China belt and road challanges

[krzepice1976]

China has spent nearly five years steering an ever-growing stream of hundreds of billions of dollars to a bold plan to gain greater global influence by funding big projects across Asia, Eastern Europe and Africa.
Now, Beijing is starting to tap the brakes.
The value of the deals that Chinese companies are striking under the country's big global plan — called the Belt and Road Initiative + — is smaller than a year ago, according to new data. Chinese officials themselves are sounding a cautious note, voicing worries that Chinese institutions need to be careful how much they lend under the program — and make sure their international borrowers can pay it back.
"Current international conditions are very uncertain, with lots of economic risks and large fluctuations for interest rates in newly emerged markets," said Hu Xiaolian, the chairwoman of the Export-Import Bank of China, a state-controlled lender that plays a big role in financing the projects, at a forum this month in Shanghai. "Our enterprises and Belt and Road Initiative countries will face financing difficulties.
https://timesofindia.indiatimes.com/world/china/china-taps-the-brakes-on-its-global-push-for-influence/articleshow/64804588.cms

 

[krzepice1976]

As a trade war rages between China and the US, Chinese Premier Li Keqiang is meeting leaders from central and eastern Europe in Bulgaria on Saturday to discuss investment opportunities.

Road and rail projects funded by China will be high on the agenda at the summit, which has raised concerns in Brussels and richer Western European countries about growing Chinese influence in the region.



Read more: http://newsinfo.inquirer.net/1007914/china-eyes-eastern-europe-investment-as-us-trade-war-sizzles#ixzz5KbXdgZdh

 

[krzepice1976]

China's massive and expanding "Belt and Road" trade infrastructure project is running into speed bumps as some countries begin to grumble about being buried under Chinese debt.

First announced in 2013 by President Xi Jinping, the initiative also known as the "new Silk Road" envisions the construction of railways, roads and ports across the globe, with Beijing providing billions of dollars in loans to many countries.

Five years on, Xi has found himself defending his treasured idea as concerns grow that China is setting up debt traps in countries which may lack the means to pay back the Asian giant
It is not a China club," Xi said in a speech on Monday to mark the project's anniversary, describing Belt and Road as an "open and inclusive" project.

Xi said China's trade with Belt and Road countries had exceeded US$5 trillion (S$6.86 trillion), with outward direct investment surpassing US$60 billion.

But some are starting to wonder if it is worth the cost.

During a visit to Beijing in August, Malaysia's Prime Minister Mahathir Mohamad said his country would shelve three China-backed projects, including a US$20 billion railway.

The party of Pakistan's new prime minister, Imran Khan, has vowed more transparency amid fears about the country's ability to repay Chinese loans related to the multi-billion-dollar China-Pakistan Economic Corridor.

Meanwhile the exiled leader of the opposition in the Maldives, Mohamed Nasheed, has said China's actions in the Indian Ocean archipelago amounted to a "land grab" and "colonialism", with 80 per cent of its debt held by Beijing.

Sri Lanka has already paid a heavy price for being highly indebted to China.
huge endeavour brings much-needed infrastructure improvements to developing countries, while giving China destinations to unload its industrial overcapacity and facilities to stock up on raw materials.

But a study by the Centre for Global Development, a US think-tank, found "serious concerns" about the sustainability of the sovereign debt in eight countries receiving Silk Road funds.

Those were Pakistan, Djibouti, Maldives, Mongolia, Laos, Montenegro, Tajikistan and Kyrgyzstan.

The cost of a China-Laos railway project - US$6.7 billion - represents almost half of the South-east Asian country's GDP, according to the study
At a daily press briefing on Friday, foreign ministry spokeswoman Hua Chunying denied that Beijing was saddling its partners with onerous debt, saying that its loans to Sri Lanka and Pakistan were only a small part of those countries' overall foreign debt.

"It's unreasonable that money coming out of Western countries is praised as good and sweet, while coming out of China it's sinister and a trap," she said.Stevenson-Yang said China's loans are quoted in dollar terms, "but in reality they're lending in terms of tractors, shipments of coal, engineering services and things like that, and they ask for repayment in hard currency."

Standard & Poor's said Beijing structures the infrastructure projects as long-term concessions, with a Chinese firm operating the facility for a period of 20 to 30 years while splitting the proceeds with the local counterpart or government.
https://www.straitstimes.com/asia/east-asia/chinas-silk-road-project-runs-into-debt-jam