China’s investment in the countries along its Belt and Road Initiative (BRI) last year rose to the highest since 2019, with much of that increase due to a new battery plant for electric vehicles.
Investment in the 147 nations in the BRI rose 63 percent to US$32.5 billion from a year earlier, a report from Fudan University said.
Driving the rise was China’s Contemporary Amperex Technology Co (CATL, 寧德時代) and Mercedes-Benz Group AG plans to invest more than US$7 billion in a battery plant in Hungary, the biggest single project in any BRI country since it started in 2013.
After the tech sector, the energy sector was the largest recipient of Chinese investment, with US$9 billion going into projects, mostly for oil, gas and green energy.
Chinese companies also signed more than US$15 billion in construction deals for the energy sector and another US$12 billion for transport infrastructure such as ports, roads and railways, the report from Christoph Nedopil at Fudan’s Green Finance and Development Center said.
Total construction deals fell 27 percent to US$35.3 billion, the lowest level since the start of the initiative spearheaded by Chinese President Xi Jinping (習近平).
Hungary was the largest recipient of Chinese investment among BRI nations, followed by Saudi Arabia and Singapore. Russia, Angola, Sri Lanka, Nepal and Peru saw no new investment or construction deals, while engagement in Pakistan dropped 34 percent, and that in sub-Saharan Africa also plunged by double digits, the report showed.
Chinese lending to a number of countries has fallen during the COVID-19 pandemic, as an increasing number of borrowers in Africa and elsewhere have either defaulted on their debts or requested debt restructuring. Pakistan was in talks this week with the IMF for a resumption of a US$6.5 billion bailout and Sri Lanka is moving closer to a restructuring deal.
Lending by China’s top two development banks slowed in 2020 and 2021, a separate study said.
The value of construction contracts should roughly track the value of overseas projects that are funded with Chinese loans, while the investment figure tracks overseas projects where Chinese companies have an equity stake, the report said.
As there is a possible overlap between the two and because some Chinese construction contracts will be for projects funded by other countries, the report tracks “engagement” in the BRI, not the total Chinese financing of BRI projects.
Total engagement last year was US$67.8 billion, the report said, slightly lower than the US$68.7 billion in 2021.
With an approval rating of just two percent, Peruvian President Dina Boluarte might be the world’s most unpopular leader, according to pollsters. Protests greeted her rise to power 29 months ago, and have marked her entire term — joined by assorted scandals, investigations, controversies and a surge in gang violence. The 63-year-old is the target of a dozen probes, including for her alleged failure to declare gifts of luxury jewels and watches, a scandal inevitably dubbed “Rolexgate.” She is also under the microscope for a two-week undeclared absence for nose surgery — which she insists was medical, not cosmetic — and is
CAUTIOUS RECOVERY: While the manufacturing sector returned to growth amid the US-China trade truce, firms remain wary as uncertainty clouds the outlook, the CIER said The local manufacturing sector returned to expansion last month, as the official purchasing managers’ index (PMI) rose 2.1 points to 51.0, driven by a temporary easing in US-China trade tensions, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The PMI gauges the health of the manufacturing industry, with readings above 50 indicating expansion and those below 50 signaling contraction. “Firms are not as pessimistic as they were in April, but they remain far from optimistic,” CIER president Lien Hsien-ming (連賢明) said at a news conference. The full impact of US tariff decisions is unlikely to become clear until later this month
GROWING CONCERN: Some senior Trump administration officials opposed the UAE expansion over fears that another TSMC project could jeopardize its US investment Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is evaluating building an advanced production facility in the United Arab Emirates (UAE) and has discussed the possibility with officials in US President Donald Trump’s administration, people familiar with the matter said, in a potentially major bet on the Middle East that would only come to fruition with Washington’s approval. The company has had multiple meetings in the past few months with US Special Envoy to the Middle East Steve Witkoff and officials from MGX, an influential investment vehicle overseen by the UAE president’s brother, the people said. The conversations are a continuation of talks that
CHIP DUTIES: TSMC said it voiced its concerns to Washington about tariffs, telling the US commerce department that it wants ‘fair treatment’ to protect its competitiveness Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reiterated robust business prospects for this year as strong artificial intelligence (AI) chip demand from Nvidia Corp and other customers would absorb the impacts of US tariffs. “The impact of tariffs would be indirect, as the custom tax is the importers’ responsibility, not the exporters,” TSMC chairman and chief executive officer C.C. Wei (魏哲家) said at the chipmaker’s annual shareholders’ meeting in Hsinchu City. TSMC’s business could be affected if people become reluctant to buy electronics due to inflated prices, Wei said. In addition, the chipmaker has voiced its concern to the US Department of Commerce
RSS