Xi leaves no doubt belt and road plan will lead to further prosperity, stability
- China’s president points way forward at forum for partners of initiative with pledges on investment, infrastructure and economic development in the face of US containment efforts
Beijing set the scene for the latest belt and road forum by issuing a white paper packed with impressive statistics to mark the plan’s 10th anniversary. They included more than 200 Belt and Road Initiative cooperation agreements with 152 nations and 32 international institutions, involving total investment of US$380 billion, two-thirds of it from China. But the white paper left a question in the minds of many of the 130-plus countries and 30 organisations represented at the forum.
Could Beijing keep it up, given a softening of economic growth amid a sluggish recovery from the Covid-19 pandemic slowdown? The answer is a resounding yes, to be found in President Xi Jinping’s opening address at the forum yesterday. Xi pledged to maintain funding for the initiative, compared with the two previous forums, laying to rest concerns China might apply the brake.
The basic reason is that Beijing sees the belt and road as an important long-term commitment. In any case, on the same day, the mainland posted better-than-expected GDP growth for the third quarter, showing that its economy is recovering and may be back on track to meet full-year targets. It all added up to positive news for the belt and road partnership, amid global uncertainty, war at the heart of Europe, and further conflict in the Middle East.
There is, however, more emphasis on value for investment funds dispensed under the initiative, such as steps to make the best use of resources with a reduction in the amount of cheap loans and direct aid, and an important move to combat corruption that siphons off development funds. Xi also stressed the importance of funding the belt and road according to the market mechanism.
Deep-sea terminals
The focus is still on building the infrastructure to connect and bind economies. The speeches of Xi and Russia’s President Vladimir Putin outlined transport networks that will connect leading ports and cities in the European and Asian continents, and link them with Africa. China also values cooperation with other Central Asian and European partners, reflected in Xi’s meetings with the presidents of Kazakhstan, Hungary and Serbia, all critical in rail links.
Putin further talked about creating deep-sea terminals for the so-called northern sea route, opening the Arctic for shipping. This also signalled that Russia would shift its economic development focus eastward and be more open to China’s policy. Xi talked about building a road bridge to connect Europe and Asia. These initiatives, even if only partly implemented, will bind economies and profoundly change global geopolitical and economic development.
The greater involvement of Russia in China’s belt and road plan is both an opportunity and a risk. It is hard to exclude Moscow from a huge trans-European-Asia market, and its participation makes the initiative more competitive than alternatives floated by Washington, New Delhi or Tokyo. But Russia’s invasion of Ukraine may also complicate the issue and create resistance against the plan, particularly from Europe.
Xi took the opportunity to contrast China’s approach with that of the United States. He stressed that its focus was to help others to develop and grow, not to impose its ideology and values on them. By tying China’s future with the countries involved – largely developing nations – China is creating a huge strategic hinterland for itself and resisting US containment efforts.
Super connector
Without naming America, Xi criticised unilateral sanctions and hi-tech controls, just as Washington announced the latest round of restrictions on artificial intelligence chips. China is not the only belt and road economy facing similar curbs, and they can band together to blunt the US effort.
China also promised to expand science and technology cooperation. On the same day, in another move to counter US pressure, Beijing announced its first global AI initiative and governance plan, using the belt and road platform to “promote the sound, orderly and secure AI development in the world”.
In his first appearance at a high-level belt and road forum, Chief Executive John Lee Ka-chiu urged a gathering of entrepreneurs to set up offices in Hong Kong to take advantage of its role as a super connector to the mainland and the Greater Bay Area economic powerhouse. Lee reminded the audience at the opening event of the two-day forum that Hong Kong was an international financial hub, an offshore renminbi centre and the country’s only common law jurisdiction. He said businesses could count on the city’s strong professional support to make the most of opportunities. In that regard, the Independent Commission Against Corruption offers a good model for an efficient anti-graft mechanism to ensure money goes into legitimate projects and not into the pockets of officials and those in positions of trust.
Xi’s speech set out clear direction and focus for the next stage of the Belt and Road Initiative, including concrete goals that build on the existing foundations. Geopolitics permitting, it offers a path to shared prosperity and stability.
