Not so long ago, when China itself took foreign aid. But now everything has turned upside down – more than 150 countries are now borrowing from China for development projects, and many will be shocked to hear the amount. As a new one, China is paying at least twice as much as the United States and other major powers for development aid.
According to a survey conducted by Edidata, a research center at William and Mary University in the US state of Virginia, China has disbursed, 84.3 trillion to 175 countries over a 17-year period and spent 13,426 infrastructure projects. Most of this money comes from various state-owned banks in China, and these are given as “risky” loans at high-interest rates.
Much of this is related to Chinese President Xi Jinping’s ambitious Belt and Road Initiative, or BRI project. The project was launched in 2013 to build new avenues for world trade. The debt burden on the shoulders of many countries? Critics fear that the high-interest loans from which China’s projects are being financed are inadvertently imposing huge debt burdens on the people of many countries.
Now Chinese officials are also investigating. Researchers at Eddata have been researching for four years – where Chinese loans are going around the world and how they are being spent. They say Chinese government ministries regularly receive information from them on how their money is being used abroad.
Brad Parks, executive director of data, says Chinese government officials are talking to them all the time and they say they do not have access to the data internally. An Example: The Laos-China Railway Project The construction of a railway between China and neighboring Laos is seen as a great example of Chinese loan financing initiatives. For the past few decades, politicians have been dreaming of a connection that would allow Southeast Asia to establish direct contact with landlocked southwest China.
But engineers say the project will be very expensive – because the railway will have to be built through high mountain areas, with many tunnels and bridges. Laos is a poor country and they do not have the capacity to pay for a small part of the project. But as soon as the ambitious Chinese bankers entered the stage, the picture changed.
Several Chinese state-owned companies, and a consortium of state lenders, assisted in the project. That াইন 5.9 billion railroads is now on its way to launch. The train is scheduled to start operating in December. But Laos had to borrow ৮ 460 million from a Chinese bank to finance the project’s equity. One of the few lucrative sectors in Laos’s economy is their potash mines.
The country borrowed heavily from this mining income. Wanjing Kelly Chen, a research associate professor at the University of Science and Technology in Hong Kong, said: “The loan provided by Eximbank to finance the equity portion of Laos shows how eager the Chinese state was to implement the project.” Most of these lines are owned by the Chinese-controlled railway group. But the agreement was made in such a way that the Laotian government was ultimately responsible for the railway debt.
As a result of the deal, Laos’ rating to international lenders plummeted. Laos is set to go bankrupt in September 2020. The country then sold a large portion of its energy grid to China for কোটি 800 million to ease the debt burden of Chinese donors. When this happened – even then that railway line was not started.
The rail project in Laos, which has surpassed all other countries in financing development, is not the only risky venture of Chinese state-owned banks. But even then, China is the biggest source of money for many low- and middle-income countries.
Brad Parks says China’s average international funding in any given year is ৮ 6.5 billion. In comparison, the amount of aid that the United States contributes to global development each year is only about ৭ 3.6 trillion. Many details of the Chinese loan agreement are kept secret. China has long surpassed all other countries in financing international development projects. But the way Beijing has progressed to this level is exceptional – says Aidata.
In the past, Western countries were blamed for trapping African countries in debt. China is lending money to these countries in other ways. Here projects are not being financed through grants or loans from one country to another.
On the contrary, almost all the loans that China is giving are coming as loans from state banks. The official description of the borrower’s government debt does not mention the loan from China. This is because these agreements with state-owned banks in China often do not include the name of any central government institution.https://bbin-csdn.com