Date of Award
China, Debt trap, One belt one road
Infrastructure has been a bottleneck for industrialization of developing countries. After decades of economic growth led by investment in infrastructure, China released its first global strategy in 2013, One Belt One Road (BRI), to improve infrastructure in less developed countries along the belt and road. Although economic development has been witnessed in some BRI members, large amount of investments from China raised concern over debt crisis from the Western world and host countries. Countries receiving loans from China are struggling to effectively manage the BRI projects. Some are renegotiating the investments with China and some BRI members even canceled them. However, one reality that cannot be ignored is that the majority of BRI members have successfully finished their BRI projects and integrated them into the national economy. The main goal of this paper is to determine whether three elected BRI members (Djibouti, Pakistan and Maldives) have been exposed to the debt crisis caused by massive investments from China. This research also covers details of the BRI contracts signed by China and BRI members in which the amount of investments, interest rates of the loans and the cooperation models will be explained. By comparing debt conditions of BRI members with the debt crisis of Mexico in 1982, readers should draw the conclusion that a limited number of BRI countries are facing a debt crisis caused by China’s BRI. These BRI members are in a difficult stage of economic development where many new developed economies have conquered. Also discussed in this paper are the roles of the IMF and the World Bank to seek international cooperation between China and western countries in external debt borrowing.
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Liu, Qi, "China’s One Belt One Road Initiative—A Debt Trap?" (2020). Electronic Theses and Dissertations. 1803.
Received from ProQuest