The Wall Street Journal (September 28) reported that on September 26, AidData, a research center
at the College of William and Mary in Williamsburg, Va., released an in-depth report on China's
Belt and Road Initiative (BRI) which counted 42 low- and middle-income countries that now have
debt exposure to China exceeding 10% of their annual gross domestic product. It identifies $385
billion in Chinese loans as not included in nations’ official borrowing—or nearly half of China’s
overseas lending for construction of roads, railways and power plants. This hidden debt has
become more common because lenders fund activity through special-purpose corporations instead
of host governments. The report also estimates 35% of China’s overseas infrastructure projects
have faced major problems like corruption scandals, labor violations, environmental hazards and
public pushback. AidData links almost 400 projects valued at $8.3 billion to China’s military. The
report unravels details of $843 billion in Chinese loans for 13,427 projects primarily between 2000
and 2017. AidData said its findings show Beijing has both before and under the Belt and Road
plan consistently pursued three goals: turning the enormous haul of dollars earned by the nation’s
exporters into foreign loans; keeping its massive domestic construction and industrial sectors busy
by pursuing building projects abroad; and securing commodities like oil and grain to plug domestic
shortfalls. Some 49% of Chinese lending during the period covered by AidData has been
earmarked for Africa. A separate study by researchers at Johns Hopkins University and Boston
University says outlays to that region dropped almost 30% in 2019, to $7 billion from $9.9 billion
the previous year. Wu Peng, a top Chinese Foreign Ministry official for Africa, this month told the
China Africa Project nonprofit media organization that Chinese lenders have agreed to suspend
payments on debt owed by 19 African countries since the advent of Covid-19.
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