China's Belt and Road initiative begins to crumble
as most client states begin to default on their loan repayment requirements. A guest speaker this week at the 3rd Belt and Road (B&R) Initiative is the wanted war criminal Vladimir Putin. The B&R customer countries are mostly countries with large amounts of natural resources, rather than poor countries with not much of anything that would have greatly benefited from any improvements.. Most of the investment money is used to develop energy & mineral resources China hoped to someday export (aka pillage) and profit off as a partial repayment of the loan money due to China in return for the improvements on that countries roads and infrastructure. Sadly, like happened inside China's cities, many of the Chinese companies contracted by China to do the work in those places where the B&R was happening took out loans to start the constructions, started the constructions, then (under Chinese banks liberal loan policies) took out more loans to begin other projects, which they began before the first project was even half done, then repeated and repeated until the collapsing Chinese economy forced a halt to the easy loan policies. The projects not completed and their own cash on hand shrinking the countries can not repay, the energy and mineral infrastructures not built China can't export the resources of the host country, and of course the Chinese construction companies can't repay their loans to the Chinese banks or finish the projects they began. China is now faced with the choices of complete all projects and not see any financial benefit for decades, or simply walking away from many B&R projects in many countriesChina's financial exposure to date on the B&R is over 600 Billion dollars in loan promises from the host countries. This is in addition to another 600 Billion dollars of B&R investment loans to develop oil resources in Russia. The investment rating risk of the projects is currently at B- which is only a step away from being a total loss. Chinese investments into Russia ceased in 2022, but Russia has not repaid it's debts to China and many projects there are not completed. The largest recent recipient of Chinese investment money is Iraq (10.5 Billion dollars of signed loan contracts) for the development of Iraq's oil resources. The total current debt exposure of China is about 1.3 Trillion dollars of which about 60% is in default.
The current 3rd forum in China is as more about the country leaders meeting with a debt collector and offering their excuses as it is about anything else.
The below YT video provides more detail, history, figures, etc. .
Comments (11)
If possible, can you post where you found these debt amounts?
So while many countries are defaulting or requesting a renegotiation regarding the loan terms, mostly due to repercussions created by Covid 19, there has been little to no information regarding the actual amounts owed.
If possible, can you post where you found these debt amounts?
So while many countries are defaulting or requesting a renegotiation regarding the loan terms, mostly due to repercussions created by Covid 19, there has been little to no information regarding the actual amounts owed.
The Yuan will almost also be below the value of the US dollar until the fall from grace that the US doller will experience in the near future, but no need to worry i'm sure the Chinese won't let the US people suffer as much as other countries have under a US dominated system..
It's a win win situation (for China). The only problem at present is default in China itself which wasn't foreseen (unless the government planned to take possession of those companies). We will see how that affects things.
You can see how Russia has already taken possession of foreign companies in Russia. Putin has been doing this kind of thing since 2000. China has been doing it's thing for decades.
China and Russia are together in this (which is why China doesn't speak up about Ukraine.
China's economy is strong (up to 2022). Exports exceed imports. Foreign debt is well within reason (US probably owes China more) and the budget is balanced.
This is their way of doing business. Can the extreme capitalists of the west condemn them?
The worlds seen it far to many times and the worlds feed up with it now, it plain to see that countries are dumping the dollar for international trade..
Let me break it to you.
You are on the wrong side of the world.
A joker in the deck is of course the Mid East. If things go bad there it would have economic effect on everyone. Because Russia can't deliver enough China had begun buying oil from Saudi Arabia. Suddenly losing that oil flow due to a Mid East crisis would be bad for China. If all nations lost that oil flow it would be bad for almost everyone. Etc, etc.
Including European ones, as the Europe union membership doesn't prevent them from joining other economic unions.
Whoever wants to find problems with China's or Russia's economy is simply delusional. Or express very strong wishful thinking.
Everyone knows that Russia is selling even more petrol and gas products now, even to those who imposed the sanctions.
But these are not the only desireble products which sales are blooming right now.
And right now on the radio I'm listening how more and more countries are stopping the weapon supply to Ukraine.
That speaks louder than "experts" .
Similar with oil. You can easily track how much oil is sold by the number of oil tankers going to Russian terminals and by the capacity of their few remaining pipeline. Russian oil sales are way, way down by volume. China has begun to stop buying oil from Russia and now buys a fair amount from Saudi Arabia and other mid-Eastern facilities, simply because the transport costs are much cheaper from the Mid East than from Russia.
The end rusult is since ol and gas revenues were the main export product of Russia, Russia's income is way, way down and their own publicly published budget shows it. What have you been smoking?
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