JOHANNESBURG, Jan 27- China’s position as a major financier of developing economies has shifted over the past decade, with lending to poorer nations declining sharply while repayments on existing debt continue to climb, according to new analysis from ONE Data.
The inaugural report by the ONE Data initiative shows that many low- and middle-income countries — especially across Africa — are now sending more money to China in debt repayments than they are receiving in new loans from the world’s second-largest economy.
This change has occurred alongside a significant rise in net financing from multilateral institutions, which have become the primary source of development funding once debt-servicing outflows are factored in.
According to the analysis, multilateral lenders boosted their net financing contributions by 124% over the last decade and now account for 56% of net financial flows, totaling $379 billion between 2020 and 2024.
“What’s happening is that new lending has slowed, but the debt from previous Chinese loans still has to be repaid — and that’s what’s driving the outflows,” said David McNair, executive director of ONE Data.
Africa has seen the sharpest turnaround in Chinese financing. The continent shifted from receiving $30 billion to paying out $22 billion, representing a $52 billion reversal.
During the most recent period for which data is available, from 2020 to 2024, Africa experienced the greatest impact, with inflows of $30 billion recorded between 2015 and 2019 turning into net outflows of $22 billion.
The data does not yet reflect aid reductions that took effect in 2025. The shutdown of the U.S. Agency for International Development last year, along with decreased funding from other developed nations, has already affected developing economies, particularly in Africa.
McNair said that once 2025 figures are released, they are expected to reveal a substantial decline in Official Development Assistance flows.
He described the trend as “a net negative” for African countries, noting that many governments are struggling to finance public services and investment projects. At the same time, he said, reduced dependence on external funding could encourage stronger domestic accountability.
The report also pointed to a wider downturn in bilateral financing and private external debt flows — developments that are likely to worsen as aid cuts from 2025 onward take effect.
