Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that a number of international studies have shown that most of the projects under China’s grand “The Belt and Road” plan do not show sound financial returns. When the top three international rating agencies ranked the 68 partner countries China included in “The Belt and Road” plan, 27 showed they suffered from “Garbage” level sovereign credit. Among the rest of the countries, 14 (including Afghanistan, Iran and Syria) either were not rated, or the respective governments withdrew their rating requests. “The Belt and Road” plan estimates that, over a ten year period, it will achieve a spending level of US$1.2 trillion on such infrastructure projects as railways, roads, ports, and power grids. Financial and banking experts suggested that it would be a better idea to classify the plan as a geopolitical investment rather than a profitable financial program. China has so far spent or committed to spend over US$500 billion, which does not include large commercial bank loans. The source for most of this spending is China-backed investment funds.
Source: Lianhe Zaobao, October 28, 2017