CHINA: Coronavirus runs roughshod over debt-laden belt and road projects.

BRI countries such as Montenegro, already deeply indebted to Beijing, face mounting difficulties related to the pandemic as commodity prices plunge, trade falters and exchange rates shift.

“A debt crisis with Chinese characteristics?” warned Germany’s Kiel Institute for the World Economy in a report last year citing growing default risks.

Adding to the challenge of managing mounting global indebtedness is Beijing’s characteristic lack of transparency.

“The Chinese government considers the details of its overseas lending programme a state secret. No one really knows the numbers,” said Brad Parks, executive director of AidData, part of the College of William & Mary in Virginia, and co-author of a study on Chinese lending practices released last month by the Centre for Global Development (CGD).

Experts estimate that developing countries’ “hidden debts” to China totalled US$380 billion well before the crisis, more than their obligations to the Paris Club, a group of 19 wealthy creditor nations, combined; the World Bank; or the International Monetary Fund.

“If you owe the bank $100 that’s your problem. If you owe the bank $100 million, that’s the bank’s problem.”

China has a problem.