Country, estimated to be owed up to $1.5trn, is increasing penalties for late payments and cutting back on infrastructure projects

Country, estimated to be owed up to $1.5trn, is increasing penalties for late payments and cutting back on infrastructure projects

China has become the world’s biggest debt collector, as the money it is owed from developing countries has surged to between $1.1tn (£889bn) and $1.5tn, according to a new report. An estimated 80% of China’s overseas lending portfolio in the global south is now supporting countries in financial distress.

Since 2017, China has been the world’s biggest bilateral lender; its main development banks issued nearly $500bn between 2008 and 2021. While some of this predates the belt and road initiative (BRI), Beijing’s flagship development programme has mobilised much of the investment in developing countries.

But a new report by researchers at the AidData research lab at William & Mary, a public university in Virginia, found that China, the world’s second largest economy, is now navigating the role of international debt collector as well as being a bilateral funder of major infrastructure projects.

    • TokenBoomer@lemmy.worldEnglish
      21·
      1 year ago

      The DCA, or the Development Credit Authority, on the other hand, was the initiative used by USAID to give loans, loan guarantees, and risk assurances to businesses—which essentially protected those businesses from any financial risks when they entered into new markets and privatized public infrastructure in developing countries.

      Edit: Wikipedia