75 nations face $22bn debt repayment to China

China will turn from a capital provider to a debt collector of 75 developing countries, including the world's poorest and most vulnerable, this year as they are due to pay back a record USD 22 billion loans owed to Beijing, according to data released by an Australian think tank.

- PRESS TRUST OF INDIA

China has become the leading debt collector of developing countries, shifting from a net capital provider, "as bills coming due from its Belt and Road lending surge in the 2010s now far outstrip new loan disbursements", the latest research report of the Australian think tank, the Lowy Institute, said.

In 2025, about 75 of the world's poorest and most vulnerable countries will make “record high debt repayments” totalling USD 22 billion to China as a result of peaks in new loan commitments made from 2012 to 2018, the report said.

China faces a dilemma and growing diplomatic pressure to restructure unsustainable debt besides mounting domestic pressure, particularly from its quasi-commercial institutions, to recover outstanding debts, according to the report prepared by Riley Duke.

Duke said that the research was being published now because China's Belt and Road Initiative (BRI) lending spree peaked in the mid-2010s, and those grace periods began expiring in the early 2020s a likely “crunch period” for developing-country repayments to China.