China loans to Pak, Lanka and other nations worth $240bn in 2 decades: Report
Xi Jinping: The bailouts allowed countries to extend their loans and remain solvent, the report said.
China helped 22 developing countries which were at the risk of default over the past two decades, a report said. Beijing handout out $240 billion worth of bailout loans to nations which included Belt and Road Initiative (BRI) countries such as Sri Lanka, Pakistan and Turkey that have received Chinese loans for infrastructure development, the study pointed out.
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The study has been conducted by the US-based research lab AidData, the World Bank, the Harvard Kennedy School and the Kiel Institute for the World Economy. It showed that China's bailout loans accelerated between 2016 and 2021, with Beijing giving out 80 percent of its lending in that period.
The bailouts allowed countries to extend their loans and remain solvent, the report said. “China has developed a system of 'Bailouts on the Belt and Road' that helps recipient countries to avoid default, and continue servicing their BRI debts, at least in the short run,” it said.
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"Beijing has targeted a limited set of potential recipients, as almost all Chinese rescue loans have gone to low- and middle-income BRI countries with significant debts outstanding to Chinese banks," it added.
Warning that China's loan to countries are more opaque compared to other international lenders, the report said that the dole outs come at an average interest rate of five percent in contrast with a usual two percent rate on an IMF loan.
More than 150 countries have signed up to the BRI which was unveiled by China's President Xi Jinping a decade ago through which Beijing said that iaims to deepen trade relations.
