China Transitions from World's Largest Creditor to Largest Official Debt Collector as $1.1 Trillion in Loans to Developing Countries Come Due

China faces increasing financial distress as developing nations default on loans; shift in lending sees focus on bailing out financially-strapped borrowers.

Developing countries owe Chinese lenders at least $1.1 trillion dollars, more than half of which are now due as many borrowers struggle financially, according to a new data analysis.
80% of China’s lending portfolio in developing countries is currently supporting nations in financial distress; in 2008, Beijing was only dealing with 10 financially-distressed countries with unpaid debts.
The shift in China's lending sees a reduced focus on infrastructure projects and an increase in emergency rescue loans to help financially distressed countries; these bailouts are given with particular attention to major Belt and Road borrowers where Chinese banks have the highest exposure.
AidData's figures reveal that up to $1.5 trillion of debt may be owed to Chinese lenders by developing countries as of 2021.
Despite the rising financial distress, China remains the world’s single largest official source of development finance, out-funding any single Group of Seven (G7) developed economy as well as multilateral lenders.

South China Morning Post