China provided loans to developing countries on secret terms that put other creditors in an unequal position and gave the PRC an advantage.

This approach threatens to undermine efforts to reduce the debt of low-income countries, experts say. The authors of the report analyzed one hundred contracts that China entered into, and found out that there were clauses on confidentiality. They made it difficult for other lenders to establish the true financial position of the borrower.

Additionally, a number of conditions influenced the domestic and foreign policies of the borrowing countries. Also, Chinese banks obliged countries to exclude debt from the Paris Club restructuring list. This organization deals with the settlement of the state debt of the borrowing countries to the creditor countries. The PRC is at the top in the list of the largest sovereign creditors of developing countries.