Today, AidData is releasing new country profiles that detail the scale and scope of Chinese development finance across 20 low- and middle-income countries from 2000 to 2022.
Drawn from AidData’s Global Chinese Development Finance Dataset, Version 3.0, the profiles also provide a sneak peek into new, preliminary data for a forthcoming update to our global dataset, which will be released in late November.
The profiles offer a new understanding of how Chinese development finance plays out at the country-level for 20 recipients: Argentina, Bangladesh, Cambodia, the Democratic Republic of the Congo, Egypt, Ethiopia, Iraq, Laos, Mali, Mozambique, Myanmar, Niger, Serbia, South Africa, South Sudan, Tajikistan, Uzbekistan, Vietnam, Zambia, and Zimbabwe.
Key trends in Chinese state-directed finance across 20 countries
Across the 20 profiles, AidData analyzes $320 billion in official financing from over 300 different Chinese financiers. In total, financing for these 20 countries alone account for almost 20% of China’s total development finance directed to 165 low- and middle-income countries and regions from 2000 to 2022. The selected 20 countries include four upper-middle income countries, five lower-middle income countries, and eleven low-income countries.
Taken together, these 20 country profiles represent a wide spectrum of China’s partners—from upper-middle-income economies like Argentina, one of China’s top recipients, to low-income countries with small portfolios, such as Mali. Yet across this spread, several clear patterns emerge in how Beijing engages as a development financier.
Loan dominance
Across all income groups, the overwhelming share of China’s development finance is delivered through loans rather than grants. In the 20 profiled countries, loans accounted for 94% ($300 billion) of total Chinese financing between 2000 and 2022, underscoring Beijing’s preference for credit-based engagement. The other 6% ($20 billion) represented grants, including donations, scholarships, training, free-standing technical assistance, and debt forgiveness.
Infrastructure focus
The vast majority of Chinese financing is directed toward large-scale infrastructure projects across the 20 countries profiled by AidData. Within each country’s portfolio, over two-thirds of financing went towards infrastructure projects. Roughly 84% of all infrastructure projects involve at least one Chinese agency responsible for construction or implementation. By financing infrastructure projects and utilizing Chinese labor overseas, China is often able to address industrial overcapacity issues at home and position Chinese companies like China Road and Bridge Corporation and China National Petroleum Corporation to take on new projects. The remaining 32% of financing across the 20 profiles supported mergers and acquisitions, refinancing, emergency lending, and commodity prepayment facilities.
Sectoral emphasis
Key trends also emerge in China’s financing of specific sectors across these 20 countries. China’s most heavily-financed sectors, as classified by the OECD, are so-called “hardware” sectors: energy, transport and storage, industry, mining, construction, and communications. These sectors are represented by activities such as the construction of power plants, roads, mines, ports, and other large-scale infrastructure projects. Hardware sectors have the largest amount of Chinese financing, with the energy sector receiving an average of $4.5 billion across the selected 20 countries. The “software” sectors include health, education, government and civil society, emergency response, and other social infrastructure and services. In contrast to hardware sectors, China’s activities in the software sectors are often better represented by the quantity of activities, rather than the amount committed per activity. Across the 20 selected countries, each country received on average 133 loan and grant commitments in the software sector, compared to 74 in the hardware sector.
An adaptive toolkit: pre-export finance facilities, rescue lending, and strategic investments in critical minerals
While these cross-cutting patterns define the broad contours of China’s engagement across the Global South, the 20 country profiles also reveal how Beijing adapts its loan and grant toolkit to local conditions and strategic interests. In several countries, three distinctive lending instruments and sectoral priorities stand out:
- Pre-export finance facilities (PXFs)
- Rescue lending
- Strategic lending for critical minerals
Pre-export finance facilities (PXFs) feature agreements where Chinese state-directed financiers provide cash up-front, oftentimes directly to the recipient country’s government, in exchange for future oil deliveries (possibly at a discount). Both in Iraq and South Sudan, these PXFs feature as a significant part of China’s development finance portfolio and are secured against oil. For China, oil-secured arrangements deliver dual benefits: they mitigate repayment risk by swapping financial repayment for commodities, while locking in future crude oil supplies for China, which heavily relies on oil imports. However, in South Sudan, this oil-backed financing occurred only between 2013 and 2017, before South Sudan officially joined the BRI, while Iraq has an active agreement in place currently.
In times of financial distress for developing countries, China’s state-owned entities have used rescue lending, by extending currency swaps and balance of payment facilities. These emergency rescue loans are provided by Chinese state-owned entities to government borrowing institutions in low- and middle-income countries for at least one of the following purposes: (1) repaying existing debts, (2) financing general public expenditures, or (3) shoring up foreign exchange reserves. Argentina stands out as a flagship case—it has drawn down up to $22 billion annually from its swap line with the People’s Bank of China since 2014, a vital lifeline amid isolation from global capital markets. Laos similarly turned to its swap facility during the height of COVID-19 in 2020 for balance-of-payments support.
In countries with significant critical minerals, China’s use of development finance to secure access to strategic minerals is a recurring theme. In 2000, the Export-Import Bank of China provided an export seller’s credit worth $275 million for the reconstruction of the Chambishi Main Mine in Zambia, in which China Nonferrous Mining Corporation had acquired a 85% equity stake just a year prior. In the DRC, Chinese creditors have directed $9 billion to Sino-Congolaise des Mines (Sicomines SARL) for the Sicomines copper and cobalt mining project in the mining district of Kolwezi, as well as $2.4 billion provided by five Chinese state-owned banks for the acquisition of a 80% ownership stake of the Tenke Fungurume mine. In Uzbekistan, the Industrial and Commercial Bank of China contributed to a $1.2 billion syndicated loan in 2022 to Navoi Mining and Metallurgical Complex Company, one of the world’s largest gold producers. These examples and others highlight China’s decade-long interest in the extraction, processing, and import of critical minerals through the lens of development finance.
Diving inside the country profiles
AidData’s country profiles not only summarize China’s development finance footprint, but also unpack how its engagement unfolds within recipient countries. Each profile is organized around four sections to help readers explore both the scale of Chinese financing and the dynamics that shape its implementation on the ground.
Each profile first outlines the overall composition of China’s development finance portfolio, outlining the scale of grant and loan commitments made between 2000 and 2022. As well as introducing key statistics, such as the top Chinese financing agencies active in a country and top sectors, this section also compares how other development partners and institutions fare against China’s portfolio—with China often outperforming other bilateral and multilateral partners.
The second section analyzes the composition of China’s loan commitments in each country, including the proportion of loans likely currently in repayment, the amount of loans in financial distress, and the composition of lending by level of public liability (such as whether loans represent private, public or potential “hidden” public debt). During the COVID-19 pandemic, several borrowing countries also defaulted on their debt or faced struggles repaying large amounts of loans. Section 2 offers further insight on whether a borrowing country participated in the G20-initiated Debt Service Suspension Initiative (DSSI) or other broad restructuring agreements with Chinese creditors.
Both Sections 3 and 4 focus on project implementation risks and formal safeguards incorporated into China’s grant- and loan-financed infrastructure. This exercise extends the project implementation analysis established in AidData’s Belt and Road Reboot report analyzing environmental, social, and governance (ESG) risks (for more, see Chapter 3). Section 3 focuses on ESG risk exposure, using data visualizations and maps to highlight where Chinese-financed infrastructure intersects with sensitive environmental or social contexts, benchmarked against income group averages. Finally, Section 4 examines ESG safeguards, drawing on contractual evidence to illustrate how Chinese lenders have strengthened—or, in some cases, failed to strengthen—their risk management provisions over time.
Taken together, these 20 profiles provide a deeper understanding of China’s grant and loan portfolio in selected countries and demonstrate how AidData’s global Chinese development finance data can be synthesized for deep, country-level analysis.
