China’s Xi announces over $ 100 b in new Belt and Road funding

Thursday, 19 October 2023 01:48 - - {{hitsCtrl.values.hits}}

China’s President Xi Jinping with other world leaders wave during a group photo at the third Belt and Road Forum for International Cooperation at the Great Hall of the People in Beijing. President Ranil Wickremesinghe is in the back row fifth from right whilst front row includes Russia’s President Vladimir Putin, Indonesia’s President Joko Widodo, and Kazakhstan’s President Kassym-Jomart Tokayev and UN Secretary General António Guterres

BEIJING (AFP): Beijing will inject over $ 100 billion of new funding into its Belt and Road initiative, President Xi Jinping said Wednesday at a summit marking the vast infrastructure project’s 10th anniversary.

The Belt and Road is a central pillar of Xi’s bid to expand China’s clout overseas, with Beijing saying it has now inked over $ 2 trillion in contracts around the world.

Proponents hail it for bringing resources and economic growth to the Global South.

But the initiative has also been slammed for saddling poor countries with enormous debt.

Xi announced on Wednesday that key Belt and Road lenders, the China Development Bank and the Export-Import Bank, will now offer an additional $ 100 billion in loans.

Both will set up financing opportunities of 350 billion yuan ($ 47.9 billion) for BRI projects, he said.

An additional 80 billion yuan will be injected into the project’s official lending institution, the Silk Road fund, Xi said.

This week’s forum, attended by representatives of 130 countries, is the third major summit of its kind to be hosted by Beijing since the Belt and Road’s launch in 2013.

Critics have long pointed to opaque pricing for BRI projects built by Chinese companies, with countries including Malaysia and Myanmar renegotiating deals to bring down costs.

Beijing has been forced to hand out billions of dollars in bailout loans to BRI countries in recent years to allow the countries to extend their loans and remain solvent, according to a joint report this year by the World Bank and other institutions.

And China said this month that BRI participants owe more than $ 300 billion to the Export-Import Bank of China.

The initiative has also drawn scrutiny for its massive carbon footprint and the environmental degradation caused by massive infrastructure projects.

The development of megaports, pipelines, railways and highways could render the Paris climate goals unreachable, researchers from China, the United States and the United Kingdom warned in 2019.