IfW in the News

About half of China's loans to developing countries are 'hidden,' study finds


Christoph Trebesch shows in a study that China has exported record amounts of capital to the rest of the world which is mostly not reported to the IMF, the BIS or the World Bank.

Excerpt from the Article

(...) China’s lending to other countries has surged in the past decade, causing debt levels to jump dramatically, and as much as half of such debt to developing economies is “hidden,” a new study has found.

Such “hidden” debt means that the borrowing isn’t reported to or recorded by official institutions such as the International Monetary Fund (IMF), the World Bank, or the Paris Club — a group of creditor nations.

Between 2000 and 2017, other countries’ debt owed to China soared ten-fold, from less than $500 billion to more than $5 trillion — or from 1% of global economic output to more than 5%, according to the study from Germany-based think tank the Kiel Institute for the World Economy.

“This has transformed China into the largest official creditor, easily surpassing the IMF or the World Bank,” the report’s researchers said.


“China’s international lending boom is primarily a result of the country’s rapid economic growth, but also due to the “going global” policy of the Chinese state,” says Trebesch, who is head of the research area international finance and global governance at the Kiel Institute.

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