China’s financial and investment spending in Belt and Road countries fell slightly from a year earlier in the first half of the year, with no new coal projects and investment in Russia, Egypt and Sri Lanka falling to zero, new research showed.Saudi Arabia was the biggest recipient of Chinese investment during the period, with about $5.5 billion, according to a survey released on Sunday by the Shanghai Green Finance and Development Center (GFDC).
Total financing and investment reached $28.4 billion in the period, down from $29.6 billion a year earlier, bringing total cumulative spending on the Belt and Road to $932 billion since 2013, the GFDC said.President Xi Jinping launched the Belt and Road Initiative in 2013, which aims to use China’s strengths in financing and infrastructure building to “build a broad community of shared interests” across Asia, Africa and Latin America.
However, it has come under scrutiny for the debt burden it places on countries and other issues such as environmental degradation. Some countries have also renegotiated their investment projects with China and highlighted debt risks.No new coal projects have won Chinese support in the period after Xi made a pledge at the United Nations General Assembly last September to end overseas coal financing.But a Chinese developer won a bid to build a thermal plant in Indonesia in February, and according to GFDC, which is part of Shanghai Fudan University, there is still 11.2 gigawatts of capacity that already has financing secured even though construction has only just begun.
China continues to support other fossil fuel projects in Belt and Road countries, with oil and gas accounting for around 80% of China’s foreign energy investment and 66% of its construction contracts, the GFDC said.Involvement in gas projects was $6.7 billion in the first half, compared with $9.5 billion for the full year last year, the company said.Green energy and hydropower transactions were down 22% from the previous year. Investment rose to $1.4 billion from $400 million, but spending on green energy-related construction fell to $1.6 billion, less than half the level a year earlier.
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