How the world can bare Chinese debt-traps
- 42 poor or developing countries owe China debt worth 10% of GDP. The world doesn't know how much of their infrastructure and strategic minerals are in hock to China
Loans for more than $59 billion from Chinese institutions to projects in Belt and Road Initiative (BRI) countries have been renegotiated since the Covid breakout—an increase of three times in the previous two years. China has eclipsed the World Bank and the International Monetary Fund (IMF) as a source of development credit. Yet, China is not part of the Paris Club of lenders, or Club de Paris, an informal group of official creditors whose role is to find coordinated and sustainable solutions to the payment difficulties experienced by debtor countries. The origin of the Paris Club dates back to 1956 when Argentina agreed to meet its public creditors in Paris. Since then, the Paris Club has reached 478 agreements with 102 different debtor countries. Since 1956, the debt treated in the framework of Paris Club agreements amounts to $612 billion.