China Faces ‘Creditor Trap’ in Lending to Latin America: Q&A

China will be more cautious about extending loans to Latin American countries after difficulties securing repayment suggest it has sometimes fallen into a “creditor trap,” according to the author of a new book on Beijing’s lending to the region.

Yet China won’t abandon state-to-state lending as it still sees loans as a tool to boost exports, Stephen Kaplan, a former economist at the New York Federal Reserve, said in an interview about his recently published “Globalizing Patient Capital: The Political Economy of Chinese Finance in the Americas.”