To support the establishment of the Belt and Road (B&R) initiative, China Development Bank (CDB) has provided loans of $160 billion to countries and regions along the route, which experts said will help cultivate markets and drive industrialization in the long run.
They said, however, that controls are needed to prevent investment risks.
CDB has stepped up efforts to provide financial services to support the progress of the B&R initiative, with cumulative loans of $160 billion to countries and regions along the B&R route as of the end of 2016, covering infrastructure and capacity cooperation, among other areas, said Liang Huijiang, director for international finance of the bank, at a regular press conference at the China Banking Regulatory Commission on Thursday.
For example, the bank provided the first batch of funds for the Astana light rail project in Kazakhstan in December last year, marking the implementation of the fund-raising task for the first crucial project under the China-Kazakhstan capacity cooperation mechanism, read a document the bank sent to the Global Times on Thursday.
With a total investment of $1.89 billion, the project is expected to create 2,000 jobs and improve traffic conditions in the city, the document said.
Meanwhile, the bank has listed more than 500 projects, requiring funds of more than $350 billion, Liang said.
The bank will make further efforts to nurture and implement key projects and make financial innovations to enrich its products to satisfy capital needs, according to Liang.
Though these projects bring loans to some countries like Pakistan and Sri Lanka, they will create positive effects after completion, for example, cultivating markets and promoting industrialization, Wang Yiwei, senior research fellow at the Chongyang Institute for Financial Studies at the Renmin University of China, said.
People should not only consider whether these projects are profitable or not, he stressed.
Amid uncertainties and various risks in implementing the B&R initiative, a country risk evaluation system should be established to strengthen financial institutions' risk control capacity, E Zhihuan, chief economist of the Bank of China (Hong Kong), told the Global Times on Thursday.
Financial institutions should provide diversified financial tools to ease risks and promote insurers' function of preventing and controlling risks along the B&R route, she said.
