Report Reveals Extensive Undisclosed Lending Through the Belt and Road Initiative

A report by AidData has uncovered at least $385 billion in loans owed to China by 165 countries under the Belt and Road Initiative (BRI), with many debts significantly underreported to global financial bodies like the World Bank.

The study, conducted over four years, highlighted the use of semi-private and special-purpose loans to obscure debt from public balance sheets. Researchers found that 42 low-to-middle-income countries (LMICs), including Laos, Papua New Guinea, Cambodia, and Myanmar, had debt exposure to China exceeding 10% of their GDP. Laos, for instance, financed its $5.9 billion China-Laos railway project entirely through unofficial debt, representing nearly a third of its GDP.

The BRI, launched in 2013 as President Xi Jinping’s flagship investment initiative, has funded large-scale infrastructure projects worldwide. However, it faces growing competition from the G7’s “Build Back Better World” program.

AidData’s analysis of over 13,000 BRI projects worth $843 billion between 2000 and 2017 showed a shift in China’s lending practices. Around 70% of loans now go to state-owned companies, private institutions, and special-purpose vehicles (SPVs) rather than central governments. This change has contributed to extensive underreporting of repayment obligations, with hidden debts reaching an estimated $385 billion.