"The BRI at Ten: Maximizing the Benefits and Minimizing the Risks of China’s Belt and Road Initiative" 9 October 2023

A new flagship report by Kevin P. Gallagher, William Kring, Rebecca Ray, Oyintarelado Moses, Cecilia Springer, Lin Zhu and Yan Wang at the Boston University Global Development Policy Center evaluates the promise of China’s overseas economic activity in general, and the BRI in particular, finding that the BRI has delivered significant benefits to host countries, but has also accentuated real risks for China and host countries alike.

Benefits:

• New, additional resources for the Global South: From 2008-2021, China’s development finance institutions (DFIs) provided approximately $500 billion, and at least $331 billion during the BRI period of 2013-2021...
• Significant economic growth: Chinese overseas development finance has been much more focused on industrial and infrastructure lending...Chinese finance is thus more associated with economic growth...
• Co-creation of a new model of South-South cooperation and developing country agency for development...

Risks:

• Accentuated debt distress: Many of the recipients of Chinese finance are subject to significant debt distress, with several countries owing China a significant share of their external debt...
• Increased carbon dioxide emissions and air pollution: China’s overseas fleet of fossil-fuel power plants emits around 245 million tons of carbon dioxide per year, contributing to climate change. China’s overseas infrastructure also contributes to land use change that causes further greenhouse gas emissions and poses risks to biodiversity and Indigenous lands...
• Risks to biodiversity and Indigenous lands: Chinese development finance projects carry significantly higher risks to biodiversity and to Indigenous lands than projects financed by the World Bank...

Key policy recommendations for China:

• Shift its focus from a high volume to a high impact level of economic engagement overseas.
• Adapt its current approach to enable new forms of economic cooperation and opportunity for South-South cooperation, such as establishing a new project pipeline facility to match its unique business model.
• Apply new policy frameworks to help prevent and mitigate risk for China and global partners alike...