This fall marks the fifth anniversary of the launch of the Belt and Road Initiative or BRI. Five years on, the jury is still out about the BRI’s nature and actual outcomes, but Beijing’s promises of investments in infrastructure projects across Eurasia and beyond have undoubtedly managed to capture the world’s attention. The BRI’s real objectives and multilayered ambitions have been narrated from a wide range of perspectives, but there’s an emerging awareness that its impact already felt far beyond the realm of infrastructure construction.
What has become very clear is the BRI’s importance for the top Chinese leadership: Now that the BRI has been enshrined in the Chinese Communist Party (CCP) Charter, and its offshoot, “a community with a shared destiny for humanity,” has been included in the People’s Republic of China Constitution, it is harder for skeptics to continue to claim that the BRI is an empty slogan that will soon fade. In fact, the BRI will remain the organising master concept of Chinese foreign policy for the foreseeable future, all the way to 2049 (the 100th anniversary of the People’s Republic of China).The past five years have seen the concept of the programme being turned into concrete actions and results that has been felt beyond the Pacific Ocean. Experts expect the initiative to play a pivotal role in forming a new landscape for Asia- Pacific region, as well as global geopolitical spectrum. The BRI is being promoted based on three principles: mutual consultation, joint construction, and shared benefits. China has since then fully executed 101 agreements with 86 countries, and total investment in the 24 countries along the belt and road regions has amounted to US$50 billion, resulting in 75 industrial and trade zones, and 200,000 jobs as ‘China Daily’ noted. Last year, China's trade volume with those countries grew by 14.2%, marking a record growth in six years. Also, in 2017, China's imports from these countries were worth over 666 billion US dollars, accounting for a fourth of China's total import value.
American strategist Parag Khanna argued in his book ‘Connectography: Mapping the Future of Global Civilization’ that the investment in infrastructure in the next 40 years would exceed that of the past 4,000 years. While private capital is not interested in investing in infrastructure and does not link up with each other, developing countries are constrained by their weak infrastructure. Consequently, here is the stake of the BRI which essentially targeted mostly developing countries where the economy is booming, urbanisation process at its peak and therefore the demands for infrastructure are skyrocketing. McKinsey, a consultancy, estimates that every one billion US dollars invested in infrastructure creates between 30,000 and 80,000 jobs and adds 2.5 billion US dollars to GDP. One year after the opening of the Mombasa-Nairobi Railway, a flagship BRI project, Kenya’s economy grew by 1.5 per cent and the Railway was therefore hailed as the road to connectivity in East Africa.
However, despite the fanfare of President Xi, “It is an open and inclusive process, and not about creating exclusive circles or a China club”, this epic project has viewed in the west as an extension of Beijing’s global ambitions and the centrepiece of its economic foreign policy. Besides, during the past years, questions have been raised about the sheer scale of this venture amid allegations that it is nothing more than “debt book diplomacy.” Recently, new Malaysian Prime Minister Mahathir Mohammad suspended BRI-related projects – the US$20-billion East Coast Rail Link and two pipelines worth over US$2 billion because of the costs, following Myanmar’s decision to scale back plans for Kyaukpyu port due to debt risks.
Elsewhere, Nepal has been trying to halt construction of two Chinese-built hydroelectric dams while a rail link through Laos could end up being worth half of its GDP. The same applies to one of BRI’s key connectivity projects, the China-Pakistan Economic Corridor (CPEC). New Prime Minister Imran Khan is bent on renegotiating some of its terms. Then there’s the case of the Sri Lankan port of Hambantota.
Moreover, it is evident that Chinese projects are less open to local and international participation. Out of all contractors participating in Chinese-funded projects within the Reconnecting Asia database, 89 per cent are Chinese companies, 7.6 per cent are local companies (companies headquartered in the same country where the project was taking place), and 3.4 per cent are foreign companies (non-Chinese companies from a country other than the one where the project was taking place). In comparison, out of the contractors participating in projects funded by the multilateral development banks, 29 per cent are Chinese, 40.8 per cent are local, and 30.2 per cent are foreign.
Being a de-facto hegemonic power, the USA was cynical about this initiative since the genesis, but it took Washington – under the Obama and Trump administrations – almost five years to come up with a response to BRI. And that is now essentially a trade war as many experts’ view. However, the most substantial countermeasure from Washington as of today is declaring ‘Indo – Pacific Strategy’ which unleash millions of dollars for the countries in this region to invest from infrastructure to energy, technology to military sector.
However, the BRI produces numerous backlashes at home and abroad. “China is facing enormous challenges with these reactions from the [overseas] community,” Pang Zhongying, a foreign affairs specialist at the Ocean University of China, told the South China Morning Post. “Xi’s speech shows that [the leadership] has reflected on these developments and has made adjustments … and is trying to tone down its rhetoric.”
Now, whether the BRI is an actual win-win or win-lose initiative that conundrum is yet to be solved but it is evident that the PRC is keen to extend its influence not only in its backyard - Asia but beyond of it in the near future. Therefore, it is an axiom the more China extends itself around the globe, the heavier the burden will be. While the country has deep pockets, there are economic and financial challenges at home, and if things go belly up domestically, it could put strains on President Xi Jinping’s ambitions. As the Chinese general Sun Tzu wrote in “The Art of War” two and a half millennia ago, “first count the cost.”
The author is a Master of Public Policy for Sustainable Development Candidate at Tsinghua University, Beijing, China. He can be reached at: firstname.lastname@example.org.