<a href="https://www.todaynewspost.net/china-holds-over-1-trillion-in-belt-and-road-debt-making-it-the-worlds-largest-debt-collector/"><img class="alignnone wp-image-4468" src="https://www.todaynewspost.net/wp-content/uploads/2023/11/56j75467w-300x200.jpg" alt="" width="966" height="644" /></a><a href="https://www.todaynewspost.net/china-holds-over-1-trillion-in-belt-and-road-debt-making-it-the-worlds-largest-debt-collector/"><span style="color: #102c86;">A recent report reveals that China is owed more than $1 trillion through its Belt and Road project, positioning it as the largest debt collector globally.</span></a><!--nextpage--> <h1><span style="color: #102c86;">China Owed Over $1 Trillion in Belt and Road Debt: Report</span></h1> Beijing (AFP) - According to a recent report, China is the world's largest debt collector, with more than a trillion dollars owed to it through its Belt and Road project. Approximately 80 percent of these loans are said to support countries facing financial distress. China claims that more than 150 countries, spanning from Uruguay to Sri Lanka, have signed up for the Belt and Road Initiative (BRI), a global infrastructure initiative launched by President Xi Jinping a decade ago. During the first decade of the project, China provided substantial loans to fund the development of bridges, ports, and highways in low and middle-income countries. However, a report released by AidData, a research institute tracking development finance at Virginia's College of William and Mary, reveals that more than half of these loans have now reached their principal repayment period. By the end of this decade, it is estimated that 75 percent of the loans will have entered the repayment phase. AidData analyzed data on Chinese financing for nearly 21,000 projects across 165 countries and found that China committed aid and credit of around $80 billion per year to low and middle-income nations. In contrast, the United States provides $60 billion annually to such countries. "The world's largest official debt collector" is the unfamiliar and uncomfortable role Beijing finds itself in, states the report. According to AidData, the total outstanding debt, excluding interest, from borrowers in the developing world to China is at least $1.1 trillion. The report further estimates that 80 percent of China's overseas lending portfolio in developing countries currently supports nations in financial distress. Supporters of the Belt and Road Initiative praise it for bringing resources and economic growth to the Global South. However, critics have raised concerns about the lack of transparency in pricing for projects undertaken by Chinese companies. For instance, countries such as Malaysia and Myanmar have renegotiated deals to lower costs. AidData highlights that China's reputation has suffered among developing countries in recent years. Its approval rating dropped from 56 percent in 2019 to 40 percent in 2021. Nonetheless, the study states that China is learning from its mistakes and becoming a more adept crisis manager. Beijing is working towards de-risking the Belt and Road Initiative by aligning its lending practices with international standards. However, the report also reveals that China has employed increasingly stringent measures to protect itself from the risk of non-repayment. These measures include allowing key lenders to the Belt and Road Initiative to unilaterally access borrowers' foreign currency reserves held in escrow to pay themselves principal and interest due. Most concerning is that these cash seizures are conducted secretly and beyond the immediate reach of domestic oversight institutions in low- and middle-income countries. At a recent summit in Beijing marking the initiative's tenth anniversary, President Xi announced that China will inject more than $100 billion of new funds into the Belt and Road Initiative. However, a joint report by the World Bank and other institutions, including AidData, has revealed that China has had to provide billions of dollars in bailout loans to Belt and Road countries in recent years. Additionally, the enormous carbon footprint and environmental degradation caused by massive infrastructure projects under the initiative have drawn scrutiny.
