On a newspaper page, the Pakistani government celebrated its first joint project with China in the context of the Silk Road Initiative: In just 22 months, a coal-fired power station had been built in the developing country - in record time. This was made possible by fast loans from Chinese banks, told Reuters. The banks have been instructed by the government in Beijing, uncomplicated to lend money for projects of the "New Silk Road". The main thing is that things are moving fast.

China does not want to comment on that. But one thing is certain: the "New Silk Road" is one of the most important projects of the government of President Xi Jinping, who could now remain in office until the end of his life thanks to a constitutional amendment. The People's Republic wants to invest about 900 billion dollars in infrastructure projects in Eurasia. New roads are to be created between Fuzhou and Rotterdam, trains, airports. (Read details here.)

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Routes of the "New Silk Road"

The beneficiaries of this are above all the Chinese construction, steel and transport companies, which are to help implement the infrastructure projects. In 2016, Chinese companies reportedly received orders for silk-road projects totaling approximately $ 126 billion.

But even small countries that could not afford modern roads, harbors or railways themselves welcome the initiative. However, China will be the biggest beneficiary: Beijing is thus establishing itself as a pioneer of a new form of globalization, the Washington think tank "Center for International and Strategic Studies" (CSIS) is convinced.

Beijing is opening its doors with the Silk Road project, which already includes more than 68 countries: it "brings something that countries desperately want: financing infrastructure," says John Hurley. He has authored a study on the New Silk Road for the Center for Global Development (CGD). Thus, the plan from Beijing could bring small countries but in financial difficulties. Because: "With this type of lending, there can be too much of a good thing," says Hurley. However, there are no concrete figures from Beijing.

Countries with high debt risk

The study lists eight countries that are likely to be deeply indebted to Chinese lenders through Silk Road projects. In addition, there are other reports of ambitious projects initiated by China, but can not be funded by the governments of the countries.

Debt risk of individual countries along the Silk Road

  • Pakistan : The neighboring country to India, one of Beijing's main opponents, is particularly at risk of accumulating debt in China, the study said. An estimated $ 62 billion is said to have been invested in infrastructure and energy projects there. According to CGD China finances 80 percent, so contributed about 50 billion dollars.
  • Sri Lanka : The government in Colombo agreed with China an eight-billion-dollar loan, which among other things, a new port should be built. The lease runs over a period of 99 years, reports the US channel CNN. In a previous project, a port for $ 1.3 billion, Sri Lanka is said to have come in trouble in the repayment. China then agreed to a creditor participation.
  • Djibouti : More than 80 percent of the debt that the East African country has accumulated abroad came from Chinese donors in 2016. In just two years, foreign debt has risen from 50 to 85 percent of gross domestic product. Big financier, according to CGD, is the State Export-Import Bank of China (Exim).
  • Kyrgyzstan : Here, too, debt is expected to increase significantly against China. It was around 37 percent at the turn of the year 2016/2017; it could soon cover more than 70 percent of the country's debt, the researchers predict. Much of this goes back to infrastructure projects that would also be financed through external lending. A big believer is also the exim bank.

According to the CGD study, there is also a high debt risk in Laos , Montenegro , Maldives , Mongolia and Tajikistan . The "New York Times" reports on major projects with a share of Chinese donors in Kazakhstan , such as a gigantic dry dock with connected infrastructure.

Control over important projects

What is the problem with this? Experts fear that, in the event of financial difficulties, China could have a major impact on affected countries, be it through deals that are closed or by giving Beijing equal control over important projects such as ports and railways. Thus, the regime, which continues to drift towards dictatorship under Xi, could push back the Western powers in the regions even more.

The Washington Think Tank (CSIS) notes that it is difficult to keep the economic and political implications of the Silk Road projects separate. This is also problematic because the leadership in Beijing is ready to do business with any government - even if they are actively involved in conflicts. In addition, she shows up for various models of repayment open, such as through participation in natural resources or even the projects themselves.

That can also influence the politics of the respective country. The example of the Philippines shows that China, with the help of economic aid, has already succeeded in bringing a government that was formerly more into Washington into the hands of Beijing. For years, the two countries had argued for reefs in the South China Sea. The Philippines finally filed a lawsuit in The Hague - and were awarded by an arbitration right, to the annoyance of Beijing. After a visit to Beijing and a billionaire deal negotiated there, President Rodrigo Duterte announced shortly thereafter, his country would despite the decision to seek the conversation.