China provided $240 billion in Bailout loans to 22 developing countries between 2008 and 2021, are on the rise in Last few years more They struggled to pay back the loans that were spent building A study published on Tuesday showed that the “Belt and Road” infrastructure.
nearly 80% of Lending was made between 2016 and 2021, mainly for middle-income countries, Argentina, Mongolia, Pakistan and Turkey, according to a report by researchers from the World Bank, Harvard Kennedy School, AidData and the Keele Institute for world economy.
about the worldBelt and Road countries have been under pressure with rising inflation and interest rates, in addition to the ongoing impact of The COVID-19 pandemic has affected them ability to pay off debts.
The rescue operations report said allow the countries to extend their loans and remain solvent.
China says over 150 countries Occurred up For the Belt and Road Initiative, trillion-dollar global The infrastructure push unveiled by President Xi Jinping a decade ago.
Beijing says The initiative aims to deepen friendship trade Relations with Other countries, in particular in developing world.
but critics China has always been accused of luring low-income people countries inside debt By making huge unsustainable loans.
China has it developed a system of rescue operations on Belt and Road” it help recipient countries to avoid default, and continue servicing BRI debts, at least in The short run report said.
China has lent hundreds of Billions of dollars for build infrastructure in developing countries. However, lending has subsided off Since 2016 he has acted in many projects failed to pay expected financial earnings.
“Beijing is ultimately trying to bail out its banks. That is why it is in danger business of international Carmen Reinhart, MD, said: former Chief Economist of the World Bank W one of Study authors.
the study found credited by China countries in debt Distress rose by less than 5% of that it overseas lending portfolio in 2010 to 60% in 2022.
Argentina got the most, with $111.8 billion, followed by Pakistan with 48.5 billion dollars and Egypt with $15.6 billion. nine countries Received less than 1 billion dollars.
People’s Bank of Chinese swap lines (PBOC) counted for $170 billion of financing, incl in Suriname, Sri Lanka and Egypt. Loans or Progressive Balance of payments support By Chinese state-owned banks and companies $ 70 billion. coup of Both types of Loans amounted to $ 140 billion.
The study was critical of Possibly some central banks using PBOC swap lines for pumping up Their foreign exchange reserves figures artificially.
opaque
The report warned that Chinese loans tend to be the same more opaque compared with last international lenders of last Resort – and often come with average interest rate of 5% compared with typical 2% rate on A loan from the International Monetary Fund.
Many of these agreements were called “extensions”, in which is the same short-term Loans are repeated extended To refinance debts that are about to fall due.
Brad Parks said that China’s rescue lending is “murky and uncoordinated”. one of The authors of the report and director of AidData, a research laboratory in the college of William and Mary in United State.
China government hit back in criticism on Tuesday accusing “some people” of Exaggeration up The so-called Chinese debt traps, opaque and mud-throwing loans in China, which we do not accept.
“China … has never coerced anyone party borrow moneyForeign Ministry spokesman Mao Ning’s said regular Press Conference.
This month, China agreed to restructure its loans to Sri Lanka, clearing way for A rescue plan from the International Monetary Fund of The island nation that ranks Beijing as its largest bilateral creditor.
Salvage loans are mainly concentrated in average income countries This makes up Four-fifths of for lending them of the risk They put on the balance sheets of Chinese banks. In contrast, the report stated that low income countries Grace periods and maturity extensions are offered.
China is negotiating debt Restructuring with countries Including Zambia, Ghana and Sri Lanka have been criticized for holding up Processes. she has also named on World Bank and International Monetary Fund (IMF) for submission debt satisfaction.
