How China’s Belt and Road Initiative Is Changing After a Decade of Big Projects and Big Loans

Beijing: China Belt and Road Initiative After a decade of big projects that seem to be getting smaller and greener, it boosted business but left it behind Large debts and raised environmental concerns. The change comes as leaders from around the developing world descend on Beijing this week for a government-organized forum known as BRI for short.
The initiative has built power plants, roads, railways and ports around the world and deepened China’s ties with countries in Africa, Asia, Latin America and the Middle East. This is a major part of Chinese President Xi Jinping’s inspiration. affairs.
What is BRI?
Called „One Belt, One Road” in Chinese, the Belt and Road Initiative was launched as a program for Chinese companies to build transportation, energy and other infrastructure overseas through China Development Bank loans.
In the 21st century version, the goal was to develop trade and economy by improving China’s connections with the rest of the world. Silk Road trade routes From China to the Middle East and Europe.
Xi laid out the idea in broad terms during a visit to Kazakhstan and Indonesia in 2013, and it took shape in the following years, creating major projects ranging from railroads in Kenya and Laos to power plants in Pakistan and Indonesia.
How big is it?
A total of 152 countries have signed BRI Agreement Italy is the only Western European country to do so, along with China, but is expected to drop out when it comes time to renew in March next year.

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As the trade deficit with China has doubled since Italy’s accession in 2019, „Italy suffered a net loss,” said Alessia Amigini, an analyst at Italian think tank ISPI.
Along with the World Bank, China became a major financier of development projects under the BRI. The Chinese government says more than 3,000 projects worth US$1 trillion have been launched in BRI countries.
After coming under fire for the impact large building projects can have on the environment and local communities, China has filled the gap as other lenders have shifted to areas like health and education and pulled away from infrastructure, said Kevin Gallagher, director of Boston University Global. Center for Development Policy.
Chinese-funded projects have faced similar criticism, from displacing populations to adding tons of climate-changing greenhouse gases to the atmosphere.
What about debt trap?
Chinese development banks lent money to BRI projects, and some governments were unable to repay them.
This has led to accusations by the US and others that China is engaging in „debt trap” diplomacy: making loans that governments know they will default on, allowing Chinese interests to control assets. An oft-cited example is the lease of a Sri Lankan port to a Chinese company for 99 years.
Many economists say China is not intentionally issuing bad loans. Now, having learned the hard way through defaults, China’s development banks are pulling back. Chinese development loans have slumped in recent years as banks become more cautious about lending and many recipients are less able to borrow.
Chinese loans are a major contributor to the huge debt burdens weighing down economies in countries such as Zambia and Pakistan. Sri Lanka said last week it had reached an agreement with the Export-Import Bank of China on key terms and principles to restructure its debt as it tries to recover from an economic crisis that toppled the government last year.
What’s next for the BRI?
Future BRI projects will not only be smaller and greener, but will also rely more on investment from Chinese companies than on development loans to governments.
Christophe Nedobile, director of the Asia Institute at Griffith University in Australia, believes China will undertake some more big projects, including high-profile projects such as railways and oil and gas pipelines with revenues to pay back the investment.
A recent example is the launch of a Chinese high-speed train in Indonesia to great fanfare in both countries.
On the climate front, China has pledged to stop building coal-fired power plants overseas, although it has engaged in some, and is promoting projects related to the green transition, Nedobile said.
From wind and solar farms to factories for electric vehicle batteries, such as the massive CATL plant in BRI-partner Hungary, which has sparked environmental concerns.

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