More than half of China’s $1.1 trillion of loans to low- and middle-income countries have entered their principal repayment periods, a new study found, prompting a reboot by Beijing to reduce exposure to distressed debt, reports Nikkei Asia. The report published on Tuesday by AidData, a research lab at US university William & Mary, comes after Beijing pledged last month to promote “small yet smart” projects as its Belt and Road Initiative (BRI) marked its tenth anniversary.
About 55% of outstanding debt owed by developing nations—including principal but excluding interest—has entered principal repayment periods and the figure could increase to 75% by 2030, the report said.
“Beijing is navigating an unfamiliar and uncomfortable role as the world’s largest official debt collector,” AidData said, adding that some 80% of the lending involved countries in financial distress.
