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China’s Xi promotes building initiative amid debt worries

/ 06:45 PM April 26, 2019

BEIJING (AP) — Chinese President Xi Jinping promised Friday to set high standards for Beijing’s sweeping infrastructure-building initiative as fellow leaders praised the effort despite worries it is saddling some countries with too much debt.

Xi avoided mentioning debt in a speech at a Belt and Road forum celebrating his signature foreign initiative.

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 China's Xi promotes building initiative amid debt worries

Chinese President Xi Jinping delivers his speech for the opening ceremony of the second Belt and Road Forum for International Cooperation (BRF) in Beijing Friday, April 26, 2019. (How Hwee Young/Pool Photo via AP)

But he promised changes in response to complaints about costs, dubious payoffs from the projects and possible environmental damage.

Beijing wants “open, green and clean cooperation” with “zero tolerance for corruption,” Xi said.

Developing countries have welcomed the initiative, launched in 2013, to expand trade by building roads, ports and other facilities from Asia through Africa and the Middle East to Europe.

But some governments are struggling to repay Chinese loans, fueling complaints poor countries are being pushed into a “debt trap.”

The United States, Japan, India and Russia have chafed at the expansion of Beijing’s strategic influence with the building of trade and political networks centered on China.

Despite that, Russian President Vladimir Putin on Friday praised the initiative, saying it dovetails with the goals of a Russian-promoted market with four of its neighbors, the Eurasian Economic Union.

Malaysian Prime Minister Mahathir Mohamad, who had suspended plans for a Chinese-built railway and other projects due to their cost, said he was “fully in support.”

Prime Minister Imran Khan of Pakistan, one of China’s closest allies, said Belt and Road has produced “substantial progress” in increasing power supplies and other areas.

The U.N.’s secretary-general, Antonio Guterres, said Belt and Road projects could help turn the balance in mitigating climate change.

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Xi’s government is trying to revive the initiative’s momentum after the number of new projects plunged last year.

That came after Chinese officials said state-owned banks would step up scrutiny of borrowers and some governments complained projects do too little for their economies and might give Beijing too much political influence.

Other countries including Thailand and Nepal have canceled or scaled back projects while Ethiopia and others have renegotiated debt repayment.

Xi promised changes to forestall corruption and environmental damage, and sought to allay worries Beijing is reaping most of the economic benefits and gaining power at the expense of countries involved.

The Belt and Road is “not an exclusive club” and promotes “common development and prosperity,” Xi said.

He said Belt and Road will embrace international standards for project development, purchasing and operations.

China issued “debt sustainability” guidelines Thursday for assessing debt risks to borrowers that the Ministry of Finance said are based on standards of the International Monetary Fund and other international institutions.

Finance Minister Liu Kun said the guidelines, intended to “prevent and solve debt problems,” would classify countries by risk based on productivity, economic growth and other factors.

Other leaders attending the forum included Aung San Suu Kyi, state councilor for Myanmar, Ethiopian Prime Minister Abiy Ahmed and leaders or envoys from Germany, Italy and Greece.

Xi said Beijing wants to encourage cooperation on health, water resources, agriculture and technology. He promised scholarships for students from Belt and Road countries. /gsg

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TAGS: Belt and Road, bulding, China, latest news, loansm debt, world news, Xi Jinping
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