19-10-2023 (JAKARTA) President Joko ‘Jokowi’ Widodo delivered a significant address at the Belt and Road Forum on Wednesday (Oct 18), underscoring the importance of preserving the financial stability of the participating nations. President Jokowi stressed that Belt and Road cooperation should steer clear of political entanglements and instead focus on sustaining its fundamental principles.
This proclamation comes in the wake of President Xi Jinping’s announcement that Beijing intends to inject a substantial sum of over US$100 billion into the Belt and Road initiative. The Belt and Road project stands as a cornerstone in Xi’s efforts to augment China’s influence on the global stage, with Beijing proudly announcing contracts worth over two trillion dollars worldwide.
Advocates of the initiative commend it for channeling resources and fostering economic development in regions across the Global South. However, it has also garnered criticism for burdening economically disadvantaged nations with staggering levels of debt.
In continuation of this commitment to the initiative, President Xi declared that China’s principal Belt and Road financiers, the China Development Bank and the Export-Import Bank, will extend an additional $100 billion in loans. These institutions will additionally facilitate financing opportunities amounting to 350 billion yuan ($47.9 billion) for Belt and Road Initiative (BRI) projects.
Moreover, President Xi disclosed that an extra 80 billion yuan would be infused into the Silk Road fund, the official lending institution of the Belt and Road project.
This week’s forum witnessed the participation of representatives from 130 countries, marking the third significant summit since the Belt and Road’s inception in 2013. Detractors have long raised concerns about the lack of transparency in pricing for BRI projects executed by Chinese companies, prompting countries like Malaysia and Myanmar to renegotiate agreements in an effort to reduce costs.
China has been compelled to provide substantial bailout loans to BRI nations in recent years, allowing these countries to extend their loans and maintain their financial solvency. A joint report released earlier this year by the World Bank and other institutions highlighted the extensive financial support Beijing has extended to these countries.
Additionally, China reported this month that Belt and Road participants owe in excess of $300 billion to the Export-Import Bank of China. The initiative has also faced scrutiny for its considerable carbon footprint and the ecological degradation resulting from extensive infrastructure projects. The construction of megaports, pipelines, railways, and highways has raised concerns about the attainability of the Paris climate goals, as warned by researchers from China, the United States, and the United Kingdom in 2019.
