China's Belt and Road Initiative lending spree of the 2010s has paid for shipping ports, railways, roads and more from the deserts of Africa to the tropical South Pacific.
“Developing countries are grappling with a tidal wave of debt repayments and interest costs to China,“ researcher Riley Duke said.
The Lowy Institute sifted through World Bank data to calculate developing nations' repayment obligations.
“As a result, China's net lending position has shifted rapidly,“ Duke said.
Paying off debts was starting to jeopardise spending on hospitals, schools, and climate change, the Lowy report found.
The report also raised questions about whether China could seek to parlay these debts for “geopolitical leverage”, especially after the United States slashed foreign aid.
The first was in nations such as Honduras and Solomon Islands, which received massive new loans after switching diplomatic recognition from Taiwan to China.
The other was in countries such as Indonesia or Brazil, where China has signed new loan deals to secure battery metals or other critical minerals.
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