(Yicai Global) April 13 -- The China Development Bank aims to have issued CNY250 billion (USD40 billion) in special purpose loans for Belt and Road projects by the end of this year as it looks to fulfill a target set by Chinese President Xi Jinping.
The bank has already provided nearly CNY117 billion loans to date, state-backed online news portal The Paper reported, citing the lender’s President Zheng Zhijie as saying at the 2018 DBS Asian Insights Conference held in Shanghai yesterday.
Xi, who devised the 30- to 40-year plan, offered input on how much he felt the CDB should lend to related construction projects when speaking at the Belt and Road Forum for International Cooperation in May 2017. Often compared with the ancient Silk Road, Xi proposed the Belt and Road in 2013. The grand scheme includes a vast infrastructure and trade route boasting a network of highways, railroads, ports and pipelines across Asia, Europe and Africa.
Large demand for infrastructure in these countries is what made it possible to issue so many loans in such a short period of time, Zheng said.
The development bank will use two approaches to control risk in Belt and Road projects, he added. The first will be in tandem with Chinese bankcard provider UnionPay, which will help to manage legal risks in the 64 nations involved in the strategy. The second will be to study risks by country and devise risk reports for each individual nation, updating them annually.
Editor: James Boynton