Majority of China’s BRI Projects Abroad Affected by COVID-19 Pandemic: Official

Beijing: The majority of projects under China’s ambitious multibillion-dollar Belt and Road Initiative (BRI) are negatively or partially affected by the coronavirus pandemic, according to a Chinese official.

About a fifth of projects under the BRI, which aims to boost trade and investment in Asia, Africa and Europe to strengthen China’s global influence, had been “severely affected” by the pandemic, Wang Xiaolong said. , Director General of the Department of International Economic Affairs of the Ministry.

About 40 percent of the projects were “negatively affected”, and an additional 30 to 40 percent were “somewhat affected,” Wang said as quoted by the Hong Kong-based South China Morning Post.

The BRI was launched by Chinese President Xi Jinping when he came to power in 2013. It aims to connect Southeast Asia, Central Asia, the Gulf region, Africa and Europe through a network of land and sea routes. The, which links the port of Gwadar in Pakistan’s Balochistan to China’s Xinjiang province, is the BRI’s flagship project.

China hosted the BRI’s first videoconference last week as part of its efforts to launch the projects.

Projects that were disrupted included $ 60 billion from the China-Pakistan Economic Corridor (CPEC), according to the report.

India has protested to China over the CPEC as it is being laid across Pakistan-occupied Kashmir.

Some countries in Asia, including Malaysia, Bangladesh, Indonesia, Pakistan, Cambodia and Sri Lanka, have recently slowed down or reported delays for projects funded by China, the Post reported.

For example, the COVID-19 disruptions affected CPEC, the Sihanoukville Special Economic Zone in Cambodia and the Jakarta-Bandung bullet train in Indonesia, he said.

Many projects under BRI are either on hold or in progress.

The BRI is seen as an attempt by China to strengthen its influence abroad with infrastructure projects funded by Chinese investments around the world. The move also led to claims of smaller countries reeling from growing Chinese debt after Sri Lanka gave its port of Hambantota as part of a debt swap to China in 2017 on a lease of 99 years old.

In early January, 2,951 BIS-related projects worth US $ 3.87 trillion were planned or underway around the world, research and publishing firm Oxford Business Group said.

Many countries in Africa and Asia have not been able to continue with their megaprojects, mainly funded by Beijing, as they struggle to repay their debts, according to the report.

In Nigeria, a $ 1.5 billion rail project faces delays due to coronavirus-related disruptions, while many Chinese-funded projects in Zambia, Zimbabwe, Algeria and Egypt have been put on hold or could be delayed as countries fight to control the spread of COVID. 19, he said.

Many countries that have taken billions of dollars in loans from China to build megaprojects – including highways, ports, dams and railways – are knocking on Beijing’s door, demanding a freeze on repayment of the debt or certain debt cancellations, according to the Post’s report.

Earlier, President Xi promised African countries to cancel all their interest-free loans owed this year and called on Chinese financial institutions “to consult with African countries on commercial sovereign lending agreements,” he said. -he indicates.

China’s aggregate loans to Africa stood at $ 152 billion in loan commitments between 2000 and 2018, the report said, citing data compiled by the China Africa Research Initiative at the Johns Hopkins University School of Advanced International Studies.

In addition, Chinese political banks – including the China Exim Bank and the China Development Bank – which finance most of the BIS projects, are now more cautious in their lending.

Even before the pandemic, Chinese political banks were already cutting new road and highway loans. Lenders have cut funding for energy projects to the lowest level in more than a decade last year, he said.

In his address to the meeting, Chinese Foreign Minister Wang Yi insisted on the early resumption of the projects.

“It is important to relaunch as soon as possible the main Belt and Road infrastructure projects, to maintain the security of industrial and supply chains in order to provide a solid basis for the economic recovery of all countries” , did he declare.

Bradley Parks, executive director of AidData, a research lab at the College of William and Mary in the US state of Virginia, said that with coronavirus cases still on the rise, it was difficult and dangerous to continue. to do this type of construction work on site. .

“I think we are going to see a significant slowdown in the implementation of (belt and road) projects,” he said.

James Crabtree, associate professor of practice at the Lee Kuan Yew School of Public Policy in Singapore, said the glory days of the belt and the road may be over.

“Faced with a crisp post-pandemic slowdown, China has a lot less money to spend on expensive infrastructure in Africa and elsewhere,” Crabtree said.

He said President Xi was also facing strong political pressure on two fronts: from poor countries wanting loans canceled and from his citizens who didn’t want money sent overseas to be canceled. used to help recovery at home.

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