HONG KONG: Despite current trade tensions, the United States is the biggest beneficiary of China’s lending activities globally, as revealed by a study of Beijing’s lending activities, which found it is increasingly lending to higher-income countries than to developing countries.
The report, released Tuesday by AidData, a research lab at the U.S. University of William & Mary, said China’s loans and grants totaled $2.2 trillion to 200 countries in all regions between 2000 and 2023.
China has long been seen as a creditor to developing countries through its Belt and Road Initiative, but is now moving toward lending to advanced economies, supporting strategic infrastructure and high-tech supply chains in areas such as semiconductors, artificial intelligence and clean energy.
The size of Beijing’s portfolio is two to four times larger than previous estimates suggest, AidData said, adding that China remains the world’s largest official creditor.
More than three-quarters of China’s overseas lending operations now support projects and activities in upper-middle-income and high-income countries.
“A lot of the lending to rich countries is focused on critical infrastructure, critical minerals and the acquisition of high-tech assets like semiconductor companies,” said lead author Brad Parks, executive director of AidData.
The United States received the largest official sectoral credit from China, more than $200 billion for nearly 2,500 projects and activities, according to the report.
Chinese state-owned entities are “active in every corner and sector of the United States,” financing the construction of LNG projects in Texas and Louisiana, data centers in Northern Virginia, terminals at New York’s John F Kennedy International Airport and Los Angeles International Airport, the Matterhorn Express gas pipeline and the Dakota Access oil pipeline, AidData said.
Beijing has financed the acquisition of high-tech companies, while Chinese state creditors have extended credit facilities to many Fortune 500 companies, including Amazon, AT&T, Verizon, Tesla, General Motors, Ford, Boeing and Disney, the report said.
The share of loans to low- and middle-income countries fell to 12% in 2023, from 88% in 2000. Beijing has also reduced loans for infrastructure projects in the “South”, as part of its Belt and Road initiative.
At the same time, its share in favor of middle- and high-income countries has increased from 24% in 2000 to 76% in 2023. The United Kingdom, for example, received $60 billion, while the European Union received $161 billion.
