With power comes responsibility. China is already a great power — not least as a lender for development, notably in support of President Xi Jinping’s Belt and Road initiative. Chinese institutions and multilateral bodies under its influence have become significant creditors of emerging and developing countries. This role can only grow. How China handles it, not least how well it co-ordinates the management of lending and debt relief with the traditional creditors, is increasingly important. IMF MD Christine Lagarde noted in Beijing recently that "good infrastructure can help achieve more inclusive growth, attract more foreign direct investment and create more jobs". She added, though, that it is vital to ensure that the Belt and Road "only travels where it is needed". Furthermore, a combination of poor project selection with fiscal mismanagement in recipient countries might "lead to a problematic increase in debt, potentially limiting other spending as debt service rises and creatin...

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