One Belt One Road project stalls as China's economy fights out Covid-19

'20% projects seriously affected, 30-40% adversely impacted'; new investments cut back

The pandemic has taken a toll on China's ambitious Belt Road Initiative (BRI), so much so that it is now becoming financially inviable, ANI reports quoting the Kabul Times.

 

Chinese President Xi Jinping's dream of setting a new world order has come crashing, the agency said, adding that the country has been forced to cut back on new loans and investments under the BRI due to the country's shrinking economy, thanks to Covid-19.

 

Chinese investment has reduced to $47 billion in 2020 — a whopping slump of 54 per cent in just one year, observed the Green Belt and Road Initiative Centre, a research organisation.

 

Wang Xiaolong, director-general of the Chinese Foreign Ministry's International Economic Affairs Department, said 20 per cent of the BRI projects were seriously affected while other 30-40 per cent witnessed adverse impact.

 

China's economy has slumped drastically during the pandemic. There are reports that the lending under the BRI has come down from $75 billion in 2016 to just $3 billion in 2020, reports ANI.

 

Besides, the BRI projects are embroiled under different problems such as corruption, lack of financial transparency, unfair loan conditions, fears of debt-traps, and negative social and environmental impacts.

 

Even in China's all-weather ally Pakistan, just 32 of the total 122 projects announced under the BRI could be completed so far.

 

The reduced growth rate has forced the Beijing government to tighten fiscal discipline and work on financial risk, which would translate into lower prospects of China pumping money into the BRI projects now.