Beijing [China], March 22 (ANI): China Overseas Security Group (COSG), linked to China's People's Liberation Army (PLA) is in a financial mess.
The Chinese company COSG used to provide security for overseas Chinese projects under Belt and Road Initiative (BRI), has run into financial troubles as most of the BRI Projects on which it worked has turned out to be unprofitable, reported local media.
More than 100 countries signed agreements with China to cooperate in BRI projects like railways, ports, highways and other infrastructure.
It was announced by the Chinese President Xi Jinping-led regime in 2013.
China's BRI has left scores of Lower and Middle-Income Countries (LMIC) saddled with "hidden debts."
Moreover, there is a Chinese monopoly in the projects. The investments under the BRI are mostly done by state-owned enterprises and banks in China.
Chinese monopoly in lending and building infrastructure has further led to corruption. Due to no private sector participation, there is no competitive element in the programme.
The debt-trap diplomacy, the lack of transparency and unreasonable loan conditions have made the scheme extremely unpopular.
At least 236 BRI projects have been facing the debt-related problem.
China sold most of its connectivity projects to the countries which were looking at China for the success of its economic model in infrastructure projects and wanted to emanate the same path, even if it was not viable for the countries.
Moreover, China has overcommitted itself and now it is not able to sustain the aid-programme. Also, there is a slow growth rate post-COVID-19 pandemic in China leading to a lack of funds.
In addition, COSG, which operates in various countries including Pakistan, Turkey, Malaysia, Cambodia, Mozambique, South Africa and Thailand, has also faced issues related to language and culture, reported local media.
China is now facing the BRI backlash in a growing number of countries across Africa, Asia, Latin America, and Central and Eastern Europe.
Policymakers in some countries have cancelled high-profile BRI projects and many other countries have decided to take a second look at whether the benefits of BRI participation outweigh the risks. (ANI)