Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
The largest debtor to China' BRI is Russia. China has loaned $300B to Russia, mostly for energy projects, mostly unfinished, and now in question.
But that's not the only source of financial trouble for China. Having loaned out $1.3T, they now find that 60% of their loans are in default. Up until 2019, there was a cash inflow to China. It's simple to understand; China loaned out money, construction began and debtors began to make payment.
But now, since 2019-20, the tide has reversed. Now, China is paying more to maintain the loans and activity than is coming in. That figure is $3B/year and growing each quarter.
China has now turned away from Russia for energy investments and toward Saudi Arabia and Iraq. But since 60% of China's loans are in default there is some question as to whether new projects can be adequately funded.
China's choice now is to continue to put money into projects that are not being paid for in hopes of seeing a turn around, or cut their losses and leave the projects unfinished.
Covid and Ukraine War are putting China in a difficult and unforeseen position. It is very likely that their coming demographic decline will result in a much, much more serious economic decline than it would have been without BRI.
BRI has now become a Chinese liability.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
