By the end of 2023, China became the largest holder of bilateral external debt, accounting for over 25% of the world’s total, a sharp rise from the early 2000s when it lent relatively little.
China’s external lending has driven much of the rapid growth in global external debt over the past two decades, with the amount owed to China rising from $1 billion in 1973 to $193.1 billion by 2023.
China's share of bilateral debt grew from 1% in 2003 to 26% in 2023, while the U.S. saw a drastic decrease from 36% in 1973 to only 4% in 2023.
As of 2023, China is the largest creditor, followed by Japan and the Netherlands
Countries like Pakistan owe a significant portion of their debt to China, with Pakistan owing $22 billion, nearly 60% of its total bilateral debt.
Many nations with large debts to China have faced financial crises or economic difficulties.
For example, Laos owes over 75% of its external debt to China, which worsened its economic situation.
In Africa, several nations like Angola (58% of its debt to China) and the Democratic Republic of Congo (88% of its bilateral debt to China) are heavily indebted to China
with some key resources like cobalt mines being owned or financed by Chinese companies.
Sri Lanka’s debt to China, amounting to $8 billion (50% of its bilateral debt), led to severe financial troubles, culminating in the lease of the Hambantota port to China in 2017.
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