China’s Debt Relief along the Belt and Road – What’s the Story?

 In analysis, infographic

Development Reimagined’s infographic series

With the second Belt and Road Forum (BRF) kicking off, all eyes are on China to understand more about the far- reaching Belt and Road Initiative (BRI) and the potential impacts and opportunities for developing countries. Those 124 countries who have signed BRI MOUs in particular are keen to understand more about China’s global “going out” strategy and what exactly this means in terms of financing for infrastructure and other projects.

Yet, dominating the media space is the “debt trap” narrative, accusing China of providing unsustainable loans to developing countries that are now struggling to pay them back. A widely cited case is the Hambantotaport in Sri Lanka, with the Sri Lankan Government unable to pay back their $8bn loan and therefore agreeing to a debt-for-equity swap and new Public Private Partnership (PPP) with China. Although it will generate an estimated $7bn in Foreign Direct Investment (FDI) for Sri Lanka, the case nevertheless sparked worries of more countries falling into a “trap” and Chinese organisations operating national assets.

Alongside this, much of the international community is also sensitive to the prospect of BRI investments leading to debt overhang problems, having already spent close to $100bn to relieve over 35 countries of debt burdens through the Heavily Indebted Poor Country (HIPC) Initiative and the Multilateral Debt Relief Initiative (MDRI).

To explore the accuracy of this narrative, a 2018 paper published by the Centre for Global Development assessed the debt vulnerabilities of BRI countries and found that despite the concerns BRI is “unlikely to cause a systemic debt problem in the regions of the initiative’s focus”. Positive findings – however, what happens IF countries cannot pay back – can loans be cancelled or restructured instead of turned into equity? If so, what are the best practices and lessons learnt from others?

Currently, little to no research has been published on the trends in Chinese foreign debt relief and what this means for the developing countries along the BRI. Huge discrepancies across multiple sources have made it complex to formulate a complete picture and no official records exist for both Governments or the public to refer to. As China becomes a major development partner and South-South cooperation provider, there is increasing demand for more information on China’s financial flows so that governments and development partners can build effective, efficient and results-oriented partnerships with China.

To catalyse such partnerships, Development Reimagined, in partnership with the Oxford China Africa Consultancy (OCAC), have published a number of infographics breaking down Chinese foreign debt cancellations and restructuring.

Using data from a number of sources – predominantly AidData, SIAS CARI, World Bank, IMF, and UNCTAD – we consider the relative amount, frequency, and geography of debt cancellation and provideeasy to digest diagrams to visualise the global picture of China’s debt cancellations from 2000-2018 and put them in context of other global debt relief initiatives, many of which China itself participated in, as well as changes in global aid and other trends.

Here are our top 4 findings.

1/ Overall China has written off or restructured a total of $9.8bn worldwide between 2000-2018. This has been highly variable year on year.

In total, we recorded 96 debt cancellations or restructurings by China, including a $6bn worth restructuring for Cuba in 2011 which took place alongside and also spurred similar action by other creditors. Overall, 2007 saw the biggest spike in debt relief with 25 cancellations compared to 0 from 2013-2015. Since the BRI began in 2013 and the agreement of the UN Sustainable Development Goals in 2015, however, there have been fewer cancellations or restructurings, indicating perhaps a shift in strategy by China and/or its debtors.

2/China has participated in the HIPC initiative as much as other creditors. But China has provided debt relief to many more countries too – across the Belt and Road, and not necessarily sticking with IMF definitions of who is/isn’t most debt distressed.

France and Japan both provided significant cancellations and further research into the impact of this can provide best practice case studies for both China and recipient countries to draw from.

Our research shows that China hasn’t only focused on least developed or (HIPC) countries when providing debt relief. This is important news for middle income countries who might be struggling with balancing debt and essential infrastructure needs. Our analysis also indicates that when looking at debt relief China doesn’t seem to look to the IMF to determine who is most in need but considers other factors. Again, this is useful and important information for struggling countries – that they can refer to other issues not just IMF analysis.

3/ Over the period 2000 to 2018, a number of countries received multiple cancellations, and some more than others. These have the most experience of negotiating debt relief with China and can provide important lessons for others.

Our results show the majority of countries have received only a single cancellation. However, countries that have received three or more cancellations are almost all in Africa, with the highest proportion in the Eastern Africa. This shows a focus on debt relief in Africa, with Central, West, and Eastern Africa, receiving the most debt cancellations during the 2007- 2011 period – the height of the HIPC initiative. Southern Africa, by contrast, has seen a focus post-2012.

Amounts also vary. In general, most countries have received cancellations less than $100m yet Pakistan ($500m) and Cambodia ($490m) have both received significant debt relief, both these countries are also strategic partners in the BRI.  Zambia has received the biggest debt relief in Africa with $246m compared to Nigeria with only $3m. In some ways, Cuba is the most important case of restructuring with China to date and could share lessons with other countries.

4/ There is an inverse relationship between cancellations and FDI volumes, meaning the higher the level of FDI the less likely countries are to receive debt cancellations.

Our analysis indicated that debt cancellations have declined over time, which may seem surprising in the context of overall loans from China increasing over time. Since the announcement of BRI in 2013, our results indicate only 6 cancellations up to the end of 2018.

But why might this be the case? We looked at a number of possible factors – from trade to investment, and the only factor that showed a strong influence was FDI – i.e. the more investment from China the less likely China is to restructure or cancel debt. Indeed, over time, it may be that debt for equity swaps and PPPs are being preferred and used by Chinese stakeholders rather than debt waivers, as happened in Sri Lanka. However, FDI is important in itself for meeting UN Sustainable Development Goals (SDGs). It helps create jobs, and by bringing in capital investment, technology and management knowledgeit can support social development. This is important analysis for poor countries who may want to focus on negotiating to increase their share of FDI from China to promote development, instead of relying on debt relief.

What does this mean? What recommendations do we have for China and others?

Research has shown that debt cancellations and relief have positive impacts especially in Heavily-Indebted Poor Countries. In the Democratic Republic of Congo (DRC) for example, the HIPC initiative now means DRC has virtually no external arrears. The government has better financial stability and now has access to direct budget support provided by a number of development partners. Our results show that China, like many other countries, is willing to restructure and cancel debt, and we encourage Chinese stakeholders to continue to be open to these needs, because they can save lives.  We also encourage other donors to explore China’s approach and see if they too can be open to cancelling or restructuring debt for countries that are not necessarily classified as HIPC countries, especially in the age of the UN SDGs, which acknowledge that poverty requires tackling even in the richest of countries.

The fact that China is willing to cancel or restructure debt is also important information for policymakers of countries in debt or that may face trouble in the future. For these countries, they can now be better aware of what is possible with China as a creditor. We recommend that they speak to and learn from others who have gone through restructurings, cancellations and debt-for-equity swaps to work out what is the best path for them, and how to negotiate the best outcomes with China. International organisations should step in to support these lesson-learning efforts.

Finally, it is worth noting what this research does NOT imply. It does not imply that countries stop taking on loans, nor that China stops providing loans. To the contrary – an ADB study asserts that in Asia alone, $26 trillion in infrastructure investments are needed over the 2016-2030 period to maintain 3 to 7 percent economic growth, eliminate poverty, and respond to climate change. However, we all need to work hard to make sure the debt goes towards productive projects, that support the economy to grow in a green manner and contribute to the UN SDGs, rather than require cancellations. Indeed, that is our role as a consultancy…  We are a resource for both governments and the private sector to draw on to build connections and move forward most effectively.

Development Reimagined would like to thank the team at Oxford China Africa Consultancy, especially Brian Oosthuizen, for research and analysis.

Click to download the full analysis in ENGLISH and CHINESE


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Research Analyst

Edmond is a research analyst who is passionate about sustainable development, innovation, and the environment. Passionate about climate financing, he firmly believe there is a more reliable system to promote equality, growth, and welfare in societies without affecting the ecosystem. Through his skills, knowledge and experienced gained over 7 years, he wants to make an impact in the world of development. Edmond holds a Master’s Degree in Public Policy from Korea Development Institute and a BA Degree (Honors) in Business from University of Derby.


    Founder and CEO

Hannah Ryder is the Founder & CEO of Development Reimagined. A former diplomat and economist with 20 years of experience, named one of 100 most influential Africans in 2021, she is also Senior Associate for the Africa Program of the Center for Strategic International Studies (CSIS), sits on the Board of the Environmental Defence Fund, and is a member of UAE's International Advisory Council on the New Economy. Prior to her role at DR, Ms Ryder led the United Nations Development Programme (UNDP)’s work with China to help it scale up and improve its cooperation with other developing countries, including in Africa. She has also played various advisory roles for the UN and OECD and co-authored the seminal Stern Review of the Economics of Climate Change in 2006.


Deputy Director

Leah Lynch is Deputy Director of Development Reimagined (DR), and head of the China office. Leah has over 10 years of experience in development and has lived in China for over 8 years. Leah has also travelled extensively around Asia and Africa for research. Leah supports the strategic direction of the team across China, with a mission to deliver high quality research on sustainable development and poverty reduction. Leah is also Chair of the Sustainability Forum at the British Chamber of Commerce in China, providing direction on sustainability initiatives for British and Chinese business. Leah has also consulted on various evaluations on UK aid (ICAI) and is a specialist on development cooperation from the UK and China. Leah has also consulted on various UN projects, including providing support to the UN China team during the COVID-19 Pandemic. Prior to DR, Leah was at the United Nations Development Programme (UNDP) China, supporting the UN’s portfolio on communication strategies, China’s South- South Cooperation and the Belt and Road Initiative (BRI). Before UNDP, Leah lived and worked in Kenya developing sustainable water policies for the Kenyan government.


China-Africa Policy Analyst

Yike Fu is a Policy Analyst and has been responsible for leading numerous areas of work, including on debt analysis in Africa and beyond, and China-Africa trade and investment logistics and analysis. She is the co-author of “African Debt Guide”, in which she challenged the narrative that Africa is in the midst of a new debt crisis by analysing data back to the 1970s and adopting new metrics to present the real story behind the data. She also developed a benchmark to compare the financial distribution of development partners such as the UK, US, Japan, France and China in Africa. Prior to her role at DR she worked at the International Finance Corporation and African Union Representational Mission to the US. She holds a Masters in International Affairs from George Washington University.


Research Analyst

Judith is a Research and Policy Analyst, where she specialises in Africa-China relations, international development, and diplomacy. During her time at Development Reimagined, Judith has co-authored several articles published in The Diplomat on debt and China-Barbados relations and was quoted by China Daily in a piece on Women Rights in China. Previously, Judith worked as a research analyst for an Advocate and Commissioner and Oats office in Kenya.


Policy Analyst

Ovigwe specialises in geopolitics with particular reference to Africa in a changing Global Order. He is adept at critically analysing the politics of contemporary development processes and providing insight into the geopolitical interests that influence them. His work includes research, publications, tailored briefings and advising on global and regional trends, and issues at the nexus of geopolitics and development. Ovigwe appears frequently in media around the world such as Al Jazeera, TRT World, SABC, CGTN, BBC Radio, and other platforms.


Policy Analyst

Jing leads China-African health and agriculture cooperation research at Development Reimagined, having managed our FOCAC Policy Analysis and Advocacy project. She is also the co-author of “China-Africa Health Cooperation under FOCAC Umbrella”, in which she analysed China’s commitments around health cooperation since the first FOCAC summit and deepdived into four African countries’ health overview, challenges and cooperation with China as cases studies. Before DR, Jing worked at GIZ Cambodia on M&E of a disability advocacy project. She also worked as a translator with Chinese medical team in Benin.


Trade Policy Analyst

Patrick is an International Trade Policy and Trade Law Expert with over 5 years of experience. His expertise includes trade law, trade policy analysis and regional integration. He is currently engaged with Development Reimagined as a Senior Trade Analyst and was the lead author of Development Reimagined's recent Report on Africa-China Relations titled "From China-Africa to Africa- China: A Blue Print for a Green and Inclusive Continent-Wide Strategy Towards China." and “Reimaging FOCAC Going Forward.” Patrick has previously consulted for the East African Community, UNECA and for the Kenya Ministry of Trade.


Senior Policy Analyst 

Rosemary is our Senior Policy Analyst. She is a skilled policy analyst and has previously worked as a UK civil servant. She is studying Human Rights at Birkbeck, University of London with a research focus on international law in the context of health crises such as the COVID-19 pandemic.


Project Manager and Africa-China Communication Assistant

Jade is a Project Manager for Development Reimagined’s flagship project Africa Unconstrained, which focuses on financing needs and debt vulnerabilities of African countries. Her research focuses on China-Africa development finance alongside debt vulnerabilities, infrastructure needs and South-South cooperation. She has worked with a breadth of stakeholders from China, Africa and the wider international community, including governments, private sector, NGOs and civil society. Her writing has appeared in a number of publications, including The Africa Report, The China-Africa Project, The Diplomat and more. Jade holds a Master’s in China and Globalisation studies from King’s College London.


Programme Manager

Rosie is the Project Manager of Africa Reimagined (AR) at Development Reimagined (DR) where she supports high-end African brands with entering the Chinese market by operating services such as trademark protection, Chinese market research, Chinese partnership building, and Africa to China logistical support and import/export services. Rosie has worked with DR for over two years now with proven success in helping high-end African brands navigate the Chinese market. She is extremely passionate about her work because more African brands selling in the Chinese marketplace means African countries can export MORE value-added goods, create MORE jobs and foster MORE innovation in African countries.

Rosie is also alumni of the School of International Studies at Peking University in Beijing where she is also an editor at the Peking Africa Think Tank. PATT is led by a diverse group of scholars who specialise in African Studies within the context of Sino-Africa relations.



Lauren has lived in six countries from the Americas to Europe and Asia and speaks both French and Spanish proficiently. At Development Reimagined, Lauren’s research focuses on climate action both in the Asia-Pacific and in Africa, and how countries are using tools such as SDGs and Covid-19 action to build a more climate-resilient future. She holds a Masters in International Relations from Leiden University.



Etsehiwot holds a Masters’s degree in Development Studies from the London School of Economics. She has diverse experience in humanitarian and development issues by working in both multilateral organizations and international non-governmental organizations. Etsehiwot is currently a consultant focusing on the SDGs and development finance.


Economist Consultant

Dibekulu is an economist by training. He holds an MSc in International Development Studies from Palacky University Olomouc, an MSc in Development Economics from the University of Clermont Auvergne, and an MSc in Economics, Finance, and International Integration from the University of Pavia. At Development Reimagined, he works as an Economist consultant. He has strong data analysis skills, with research interests centring around development finance, impact assessment, food security, and agricultural insurance.


Project Manager

Osaru is a health professional with an MSc in Health Systems Policy and an interest in women’s health and population management. At Development Reimagined, she applies her health sector experience to global health research and collating locally applicable development insights from China.


Research Analyst

Ferdinando’s research at Development Reimagined is centred on South-South Cooperation dynamics, specifically on the analysis of Chinese investment and debt flows in Africa and their linkages to African industrialisation. He is currently a Yenching Scholar at Peking University, after having graduated from the University of Cambridge with an MPhil in Development Studies.


Research Analyst

David is a Research and data analyst at Development Reimagined. His scholarly focus is mostly on interdisciplinary research in demographic economics and development with interests in migration, economic development and policy, education, health and subjective well-being. He is currently a PhD scholar at Nelson Mandela University from which he also holds Economics and Statistics and respectively.


Research Analyst Kenya

Ivory is a Kenyan lawyer with experience in policy research and analysis. She also supports the communications team at DR. Ivory speaks English, Swahili and French.


Research And Data Analyst China 

Joy Ene is a Research and Data Analyst at DR. Joy is passionate about African/global development, poverty eradication and trade policies between underdeveloped and developing countries. She is also a fourth-year student of International Economics and Trade at the  Liaoning University, Shenyang, China. She serves as the President of the Student Union, Liaoning University, International Students chapter.


Research Analyst 

Chensi Li is a research analyst. She has previously worked for local NGOs in Nigeria and Cameroon and think-tanks in China.  Her research areas include Sino-African relations, African foreign affairs, public diplomacy, state-building and national governance.

Yixin Yu

Research Analyst 

Yixin is a Junior Research Analyst and her focus areas is on public-private partnership and entrepreneurship. She has over three years of working experience in both private and public sectors in Ethiopia. She was the China Liaison Officer for project ‘Partnership for Investment and Growth in Africa’ at International Trade Centre, where she accumulated rich experience in investment and trade promotion


Founder and CEO

Hannah Ryder is the Founder & CEO of Development Reimagined. A former diplomat and economist with 20 years of experience, named one of 100 most influential Africans in 2021, she is also Senior Associate for the Africa Program of the Center for Strategic International Studies (CSIS), sits on the Board of the Environmental Defence Fund, and is a member of UAE's International Advisory Council on the New Economy. Prior to her role at DR, Ms Ryder led the United Nations Development Programme (UNDP)’s work with China to help it scale up and improve its cooperation with other developing countries, including in Africa. She has also played various advisory roles for the UN and OECD and co-authored the seminal Stern Review of the Economics of Climate Change in 2006.