{"id":138809,"date":"2021-10-01T18:41:45","date_gmt":"2021-10-01T13:11:45","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=138809"},"modified":"2021-10-05T18:48:13","modified_gmt":"2021-10-05T13:18:13","slug":"hidden-debt-rising-for-partners-of-chinas-bri-plan","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/hidden-debt-rising-for-partners-of-chinas-bri-plan\/","title":{"rendered":"Hidden debt rising for partners of China\u2019s BRI plan"},"content":{"rendered":"\n
What is the news?<\/strong><\/h5>\n

A new study has found under- reported debts to the tune of $385 billion in projects carried out in dozens of countries under China\u2019s Belt and Road Initiative (BRI), with a rise in \u201chidden\u201d debt.<\/p>\n

The study was conducted by AidData, a development research lab at the College of William & Mary in the U.S. The report studied 13,427 projects across 165 countries worth $843 billion, in the time period from 2000 to 2017, and examined how President Xi Jinping\u2019s BRI plan, launched in 2013, has changed China\u2019s overseas lending.<\/p>\n

What are the findings of the study?<\/strong><\/h5>\n

–<\/strong> Chinese debt burdens are substantially larger<\/strong> than\u00a0previously understood, and 42 countries now have levels of public debt exposure to China in excess of 10% of GDP.<\/p>\n

– The total debt was systematically under-reported<\/strong> to the World Bank\u2019s Debtor Reporting System (DRS) because, in many cases, central government institutions in LMICs [low and middle income countries] are not the primary borrowers responsible for repayment.<\/p>\n

– The big difference between China and other prominent sources of overseas financing<\/strong> was that Chinese banks have used \u201cdebt rather than aid to establish a dominant position in the international development finance market.<\/p>\n

– <\/strong>While earlier most overseas lending involved central government institutions, now nearly 70% of China\u2019s overseas lending is now directed to state-owned companies, state-owned banks, special purpose vehicles, joint ventures, and private sector institutions.<\/strong> This has introduced major public financial management challenges for LMICs.<\/p>\n\n\n\n
From 2000 to 2017,<\/p>\n

– Biggest recipients of Official Dev Assistance:<\/strong> Iraq ($8.5 billion), North Korea ($7.17 billion), Ethiopia ($6.57)<\/p>\n

– Biggest recipients of Chinese loans<\/strong>: Russia ($151.8 billion) Venezuela ($81.96 billion) and Angola ($50.47 billion)<\/p>\n

– India ranked 23rd<\/strong> in <\/span>the list of top recipients of <\/span>Chinese loans from 2000 to <\/span>2017, receiving $8.86 billion<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

– 35% of the BRI infrastructure project portfolio has encountered major implementation problems<\/strong>, such as corruption scandals or labour violations, with Pakistan topping the list of countries with the most number of projects hit by scandals and corruption<\/p>\n

– <\/strong>China has a 4.2% interest rate, a grace period of less than two years, and a maturity length of less than 10 years. Despite such conditions, what has, however, led to many countries, such as Nepal and Sri Lanka in South Asia, turning to Chinese loans at higher interest rates is the lack of financing options<\/strong> elsewhere for infrastructure projects.<\/p>\n

Source<\/strong>: This post is based on the article \u201cHidden debt rising for partners of China\u2019s BRI plan<\/strong>\u201d published in The Hindu on 1st Oct 2021.<\/p>\n","protected":false},"excerpt":{"rendered":"

What is the news? A new study has found under- reported debts to the tune of $385 billion in projects carried out in dozens of countries under China\u2019s Belt and Road Initiative (BRI), with a rise in \u201chidden\u201d debt. The study was conducted by AidData, a development research lab at the College of William &… Continue reading Hidden debt rising for partners of China\u2019s BRI plan<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[164,9],"tags":[10105,8689],"class_list":["post-138809","post","type-post","status-publish","format-standard","hentry","category-international-relations-daily-factly-articles","category-public","tag-chinas-belt-and-road-initiative","tag-effect-of-policies-and-politics-of-developed-and-developing-countries-on-indias-interests","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":1700793036,"cached_date":1703269971},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/138809","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=138809"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/138809\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=138809"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=138809"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=138809"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}