China Lent Heavily to Developing Nations. Now It’s Helping Them Manage Their Debt

Over the course of a generation China has become the world’s biggest sovereign lender to developing economies as part of a push for business and influence that mirrors the 20th century spread of US economic power. Now comes the next chapter: With a growing list of poor countries facing debt problems, China is drawing on its enormous central bank reserves to establish itself as a source of emergency funds to bail out some of the very nations it spent years lending to.

In a new study that offers a rare look at how the People’s Bank of China (PBOC) wields its $3.3 trillion arsenal, a group of leading economists document at least $240 billion in assistance that Beijing has funneled into 22 countries including Argentina, Pakistan and Nigeria since 2000.