this post was submitted on 07 Nov 2023
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Developing countries owe Chinese lenders at least $1.1 trillion, according to a new data analysis published Monday, which says more than half of the thousands of loans China has doled out over two decades are due as many borrowers struggle financially.

Overdue loan repayments to Chinese lenders are soaring, according to AidData, a university research lab at William & Mary in Virginia, which found that nearly 80% of China’s lending portfolio in the developing world is currently supporting countries in financial distress.

For years, Beijing marshalled its finances toward funding infrastructure across poorer countries – including under an effort that Chinese leader Xi Jinping branded as his flagship “Belt and Road Initiative,” which launched a decade ago this fall.

That funding flowed liberally into roads, airports, railways and power plants from Latin America to Southeast Asia and helped power economic growth among borrowing countries. Along the way, it drew many governments closer to Beijing and made China the world’s largest creditor, while also sparking accusations of irresponsible lending.

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[–] redcalcium@lemmy.institute 13 points 1 year ago (2 children)

It happened in Sri Lanka a while ago. China financed the construction of a new deep water port. The port is finished, but Sri Lanka can't service the debt so the new port is now under China's control (99 years lease agreement).

[–] torknorggren@lemm.ee 2 points 1 year ago (1 children)

Oof. I wonder how that will work in the case of infrastructure like roads and bridges--long term tolls? At some point it has to eat away at whatever good will the Chinese were trying to buy.

If you let them build military bases and run dubious assorted operations they are actually quite reasonable with repayment plans.

Source: am Australian

[–] Kusimulkku@lemm.ee 1 points 1 year ago

China now has a Hong Kong in Sri Lanka? Weird