A study conducted by Boston University and the Chinese Academy of Social Sciences showed that in the last 10 years, China has developed a lead in financing international development. Overseas lending showed it surpassed six international multilateral institutions.
The China Development Bank and the Export-Import Bank of China have oustanding loans to overseas borrowers amounting to more than $684billion by the end of 2015.
This is short of the $700bn outstanding loans of six western-backed multilateral development institutions.
China also plans to set up two new banks focused on development including the Asia Infrastructure Investment Bank and the New Development Bank.
China’s CDB had taken over the World Bank in providing international development finance.
CDB currently has assets of $375bn by the end of 2015, according to bank annual reports, which has surpassed the Asian Development Bank and the Inter-American Development Bank.
“In terms of scale, Chinese finance is a major foot forward,” said Prof Gallagher. “All the talk in the development world is of the need to move from ‘billions to trillions’ in order to transition to a more low-carbon and equitable world economy.”
“China is emerging as the global leader in development finance,” said the study, which was authored jointly by Kevin Gallagher, professor at Boston University and co-director at the Global Economic Governance Initiative (GEGI), Rohini Kamal of GEGI and Wang Yongzhong at the Chinese Academy of Social Sciences.