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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