Chinapower

In this episode of the ChinaPower Podcast, Dr. Agatha Kratz joins us to discuss how the Covid-19 pandemic has affected China’s Belt and Road Initiative (BRI). Dr. Kratz provides background on the history and past successes of the BRI from 2013-2020. She argues that, prior to the pandemic, China’s BRI was at a low point. There were fewer contracts and increased scrutiny on past unsustainable projects and loans. Dr. Kratz contends that those pre-existing trends were further accentuated by the Covid-19 travel restrictions, deteriorated financial conditions, and disruptions in trade. Nonetheless, she explains, new BRI projects have arisen as a result of the pandemic, such as the “Health Silk Road”.    Lastly, Dr. Kratz identifies the core problem with the BRI to be the long-lasting debt – which can lead to debt crises – in recipient countries. China’s common practice of debt renegotiations, rather than debt forgiveness, creates a further disincentive. Together, they slow the appetite for further BRI projects. Alt