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China pledges $20 billion in loans for Arab states

China pledges $20 billion in loans for Arab states

BEIJING: China will provide Arab states with $20 billion in loans for economic development, President Xi Jinping told top Arab officials Tuesday, as Beijing seeks to build its influence in the Middle East and Africa.

The money will be earmarked for “projects that will produce good employment opportunities and positive social impact in Arab States that have reconstruction needs,” said Xi, without providing further details.

It is part of a special Chinese program for “economic reconstruction” and “industrial revitalization,” Xi told participants at a China-Arab States forum in Beijing’s Great Hall of the People.

Beijing is also prepared to provide another one billion yuan to countries in the region to “build capacity for stability maintenance,” Xi said, using a term commonly associated with policing and surveillance.

Since taking office, Xi has overseen a concerted effort to expand Chinese influence in the Middle East and Africa, including the construction of the country’s first military base in Arab League state Djibouti.

China has already provided vast sums to Arab countries, with Djibouti alone owing some $1.3 billion, according to estimates from the US-based China Africa Research Initiative.

The financial largesse has raised concerns both at home and abroad over the vulnerability of poor nations to such massive debt.

Last year Sri Lanka was forced to hand over majority control of its Hambantota port to China after being unable to repay its loans.