Chinese loans expose Pacific islands to risk of unsustainable debt, report finds

Lowy Institute warns Australia an infrastructure arms race could exacerbate debt sustainability problems

China has not engaged in deliberate “debt-trap diplomacy” in the Pacific, but the burgeoning scale of China’s lending, and institutional weakness within Pacific states, pose clear risks for small states being overwhelmed by debt, a new report argues.

And an infrastructure arms race between China and other countries with interests in the region – including Australia – might only exacerbate the problem.

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Read More Chinese loans expose Pacific islands to risk of unsustainable debt, report finds

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