Posted on 03/27/2023 9:30:41 PM PDT by Zhang Fei
JOHANNESBURG, March 28 (Reuters) - China spent $240 billion bailing out 22 developing countries between 2008 and 2021, with the amount soaring in recent years as more have struggled to repay loans spent building "Belt & Road" infrastructure, according to a study published Tuesday.
Almost 80% of the rescue lending was made between 2016 and 2021, mainly to middle-income countries including Argentina, Mongolia and Pakistan, according to the report by researchers from the World Bank, Harvard Kennedy School, AidData and the Kiel Institute for the World Economy.
China has lent hundreds of billions of dollars to build infrastructure in developing countries, but lending has tailed off since 2016 as many projects have failed to pay the expected financial dividends.
"Beijing is ultimately trying to rescue its own banks. That's why it has gotten into the risky business of international bailout lending," said Carmen Reinhart, a former World Bank chief economist and one of the study's authors.
Chinese loans to countries in debt distress soared from less than 5% of its overseas lending portfolio in 2010 to 60% in 2022, the study found.
Argentina received the most, with $111.8 billion, followed Pakistan on $48.5 billion and Egypt with $15.6 billion. Nine countries received less than $1 billion.
People's Bank of China (PBOC) swap lines accounted for $170 billion of the rescue financing, including in Suriname, Sri Lanka and Egypt. Bridge loans or balance of payments support by Chinese state-owned banks was $70 billion. Rollovers of both kinds of loan were $140 billion.
The study was critical of some central banks using the PBOC swap lines to artifically pump up their foreign exchange reserve figures.
China's rescue lending is "opaque and uncoordinated," said Brad Parks, one of the report's authors, and director of AidData, a research lab at William & Mary College
(Excerpt) Read more at reuters.com ...
Investing in Africa has been a leading way to ruin for hundreds, maybe thousands of years. Just don’t.
[Investing in Africa has been a leading way to ruin for hundreds, maybe thousands of years. Just don’t.]
It is my understanding that CHina’s plan was to confiscate resources and infrastructure for non-paayment. That’s why they set up the loans the way they did.
Yep. Now, if PRC hadn’t spent decades murdering its population, it might have enough to do a proper colonization; but no.
“Heart of Darkness” was written in 1899; things did not change in the century since, nor in the current century.
[It is my understanding that CHina’s plan was to confiscate resources and infrastructure for non-paayment. That’s why they set up the loans the way they did.]
Silicon Valley Bank funded Chicom startups.
“…opaque and uncoordinated…”
Hahaha
That sounds like the entire Biden administration.
Wait until these nations find out what China’s ultimately
up to.
All these countries that hated the U. S., are about to
get a real lesson.
The idea of the “BRIC” takeover of the US world order depended mainly on this. This was supposed to be Xi’s genius idea.
$240 billions are pennies for China.
Give ‘em a turn in the barrel.
Saying of Europeans in Africa: “Africa always wins”.
In a while they’ll be saying it in Mandarin.
Nice to see them fail
Bfl
It makes a lot of sense when you consider that China is a loan shark. They own a lot of people (legally/financially) in these various countries.
They are getting their hooks into Africa’s resources, not the people or the raw land (unless the raw land is deemed valuable for a given purpose...like timber).
“It is my understanding that CHina’s plan was to confiscate resources and infrastructure for non-paayment. That’s why they set up the loans the way they did.”
China isn’t stupid and they had to know of the degree of corruption in Africa (almost as bad as in DC). So they knew this outcome. The question will be how well they leverage it...and we shall find out relatively soon.
I think people who look at “Belt and Roads” as some kind of bailout miss the point completely.
It is a form of organized duress. They have them take these loans they know they will never be able to repay, with conditions of failure that will reward the communists with what they desire. Territory, influence, and facilities.
CHINA SPEAKS TO SOME AFRICAN COUNTRY: “We built this huge port for you. You can’t pay back the loans? We own it now. It is right here in the contract you agreed to. 99 years.”
I have seen where most of the development in these areas is by Chinese companies and labor, question is, in the end, can China sustain all these projects. Their one child policy doomed them to demographic disaster
Time will tell if this was a wise and sustainable venture
My opinion no
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.