Moody’s Investors Service says that China’s (A1 stable) Belt and Road Initiative (BRI) — through investments in large transportation and energy projects — helps to expand productive capacity by closing critical infrastructure gaps.
BRI investments contribute to both near-term economic growth and long-run growth potential in recipient countries.
“However, inefficient project implementation, and the absence of macroeconomic and structural reform requirements in many Chinese loans can lessen longer-term credit benefits for some sovereigns,” says William Foster, a Moody’s Vice President and Senior Credit Officer.
“Meanwhile, the scale and terms of BRI investment can amplify macro-stability risks for sovereigns with weaker economic fundamentals and limited policy effectiveness,”
William Foster, a Moody’s Vice President and Senior Credit Officer.
In a new report, Moody’s focuses on the potential long-run economic gains and near- to medium- term macro-stability risks for 12 emerging and frontier countries in South Asia, Southeast Asia and Central Asia/CIS.
Pakistan, Mongolia, Kazakhstan and Cambodia seen reaping the greatest potential
The countries are Pakistan (B3 negative), Sri Lanka (B2 stable), the Maldives (B2 negative), Cambodia (B2 stable), Vietnam (Ba3 stable), Thailand (Baa1 stable), Malaysia (A3 stable), Mongolia (B3 stable), Kazakhstan (Baa3 stable), Tajikistan (B3 negative), the Kyrgyz Republic (B2 stable), and Georgia (Ba2 stable).
Among these countries, Moody’s sees Pakistan, Mongolia, Kazakhstan and Cambodia as reaping the greatest potential for economic gains.
Moody’s notes that bilateral lending from China comprises much of the financing for BRI projects and the scale – relative to the size of the host economy, the terms of lending, and the recipient, whether a government or private sector entity – varies considerably among sovereigns.
For countries with weaker fiscal and external positions and large volumes of non-concessional funding, BRI project financing tends to exacerbate debt sustainability and balance of payments pressures.
In this context, Moody’s sees the Maldives, Pakistan and Sri Lanka as the sovereigns at greatest risk from rising debt and widening external imbalances in part related to the BRI.
Conversely, Kazakhstan, Vietnam and Thailand are not significantly exposed to potential BRI-related macro-stability risks, due to generally stronger sovereign credit profiles or the smaller relative scale of their projects.
The Importance of E-Wallets for Online Gaming Sites
With e-wallets and cryptocurrency being the most relevant options, banks have been put on the side burner, especially when e-wallets and cryptocurrency allow for fast electronic transfer, that is done instantly.
Thai Government to issue Bt50 bln ( $1.57 bln)Savings Bonds to fund COVID-19 Relief Measures
The special savings bonds are available via the “Sasom Bond Mung Kung” e-wallet, abbreviated to “Sor Bor Mor” in Thai on Krungthai Bank’s Pao Tang mobile app, and through four dealer banks. The minimum purchase of these bonds is 1,000 baht, without no maximum. Interest is paid twice a year.
BANGKOK (NNT) – Thailand’s Public Debt Management Office (PDMO) plans to issue “Ying Aom Ying Dai” (the more you save, the more you earn) government savings bonds, worth 50 billion baht, next month, aiming to use the funds to finance state projects to ease the impacts of the pandemic.(more…)
Subscribe via Email
Asia’s slow rate of vaccination is a thorn in the region’s economic recovery
Southeast Asia has been hit badly. Daily infections for Indonesia, Thailand, Vietnam are at their worst, on a seven-day moving...
TAT expects 850 billion baht ($25.7 bln) in tourism revenue after successful reopening
The Tourism Authority of Thailand (TAT) has set this year’s revenue target at 850 billion baht, 300 billion of which...
Download 1xBet mobile and play all over the world
Placing profitable bets or playing in a casino is now possible comfortably even without being tied to a computer. It...
3 ways Asia can recover from the COVID-19 pandemic faster
Countries in the East Asia and Pacific region will benefit from cooperation in three major areas: vaccine deployment, reviving sectors...
Thailand’s Vaccine Strategy: What went wrong?
Questions are being asked, and not answered, over the decision to rely almost entirely on Siam Bioscience, a local, palace-owned...