The pandemic has wreaked havoc on China’s ambitious Belt Road Initiative (BRI), so much so that it is now becoming financially unsustainable, ANI reports citing the Kabul Times.
Chinese President Xi Jinping’s dream of establishing a new world order has collapsed, the agency said, adding that the country has been forced to cut back on new loans and investments under the BIS due to the contraction. of the country’s economy, thanks to Covid-19.
Chinese investments fell to $ 47 billion in 2020 – a staggering 54% drop in just one year, observed the Green Belt and Road Initiative Center, a research organization.
Wang Xiaolong, director general of the Department of International Economic Affairs at China’s Foreign Ministry, said 20 percent of BIS projects were badly affected, while 30 to 40 percent were negatively impacted.
The Chinese economy collapsed during the pandemic. According to some reports, loans under the BIS have fallen from $ 75 billion in 2016 to just $ 3 billion in 2020, reports ANI.
In addition, BIS projects face different issues such as corruption, lack of financial transparency, unfair loan terms, fear of debt trap and negative social and environmental impacts.
Even in Pakistan, China’s all-weather ally, only 32 of the 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 mean lower prospects for China to pump money into BRI projects now.