China is retreating from its Belt and Road Initiative, cutting more than a dozen projects in the infrastructure construction program as the country faces its debt woes.
China is carrying out economic colonization through the Belt and Road Initiative. It has spent trillions of dollars to expand its influence in Asia, Africa, and Latin America.
According to Liberty Times, China disguised this big money-sprinkling operation as debt diplomacy. In fact, it was full of malicious intent.
The Chinese government knows that poor countries cannot repay the loans, but it has still induced those countries to borrow money from them. The purpose is to control the developing countries and subordinate them to China.
Unexpectedly, the COVID pandemic and the Russia-Ukraine war hit the economies of many emerging countries. Up to 60% of the countries participating in the Belt and Road Initiative are in trouble.
Meanwhile, many countries have found that the Chinese companies and banks responsible for the construction projects are the beneficiaries of China’s investment projects.
And China also found itself facing a vast bad debt crisis, forcing it to adjust its strategic direction.
Wang Yanzhi, the general manager of the Silk Road Fund, is in charge of using funds for the Belt and Road Initiative.
During an interview with Caixin, Wang confirmed that the COVID pandemic has significantly impacted some investment projects, and risks are inevitable.
He said that 15 investment projects under the Belt and Road Initiative had been withdrawn to an amount of $2.5 billion.
While adjusting its strategy, the Belt and Road Initiative has not stopped looking for new targets.
Wang said that the Silk Road Fund’s first batch of investments in Indonesia is expected to be finalized at this year’s G20 summit. An investment agreement was signed with the Indonesian Investment Agency in early July.
Another investment is in the energy sector in the Middle East. Wang said that in 2021, the Silk Road Fund acquired a 49% stake in a newly established pipeline company by Saudi Aramco, the state-owned oil company of Saudi Arabia.
But according to the Wall Street Journal, numerous infrastructure projects under the Belt and Road Initiative have stalled, and billions of dollars of loans have gone sour.
Many countries have struggled to repay their debts to China, especially in recent times when the global economy has slowed down, combined with rising interest rates and higher inflation.
Chinese policymakers are now discussing a more conservative program to evaluate new projects for financing.