Home » Xi Jinping’s “New Silk Road” is losing steam

Xi Jinping’s “New Silk Road” is losing steam

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Xi Jinping’s “New Silk Road” is losing steam

(AsiaNews) – The Belt and Road Initiative is losing strength, while Chinese investments in partner countries are declining. In 2013 Xi Jinping launched the “new silk road” project to make China the hub of world trade, thus strengthening its geopolitical status vis-à-vis the US. The Belt and Road is founded on infrastructure construction that connect the globe with China. However, from the pre-pandemic period to today, the flow of Chinese funds has dropped drastically, passing from $46.2 billion in 2019 to $28.7 billion last yearreports the China Global Investment Tracker.

Sub-Saharan Africa is hard hit. Between 2021 and 2022, infrastructure investments in the region fell by 55% to $7.5 billion, according to the Green Finance and Development Center of Fudan University in Shanghai. Among the reasons is the competition from the USA, the European Union and the G7 countries, which in the last year have intensified their commitments for the development of Africa. In economic difficulty, Beijing has also decided to select more accurately its financial interventions in the “South of the world“, the area of ​​the globe most affected by its diplomatic action. It should not be forgotten that the terms that China offers for its loans and investments are often controversial. Beijing applies higher interest rates and requires the use of its own personnel and materials.

Finally, there is the question of the financial state of the countries receiving the investments. Maybank calculations say that 60% of Chinese overseas loans have gone to states with debt problems. Several economists observe that this, together with fears of a growing influence from Beijing, leads Southeast Asian countries, for example, to become more cautious towards the Belt and Road Initiative.

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