China’s Belt and Road Initiative (BRI)
The BRI is an ambitious plan to develop two new trade routes connecting China with the rest of the world. But the initiative is about far more than infrastructure.
It is an effort to develop an expanded, interdependent market for China, grow China’s economic and political power, and create the right conditions for China to build a high technology economy.
Why create the Belt and Road?
There are three main motivations for the BRI. The first, and most discussed internationally, is China’s rivalry with the US. The vast majority of Chinese international trade passes by sea through the Malacca strait off the coast of Singapore which is a major US ally. The initiative is integral to China’s efforts to create its own more secure trade routes.
There is no doubt that China’s intention is also to make participating nations interdependent with the Chinese economy, and thereby build economic and political influence for China.
In that respect it has similarities with the Marshall Plan that followed the Second World War – but with the essential difference that China dispenses funding to other nations based purely on shared economic interests.
The second key reason for the initiative is the legacy of the 2008 financial crisis. China’s government responded to the emergency with a ¥4tn stimulus package, issuing contracts to build railways, bridges, and airports, but saturated the Chinese market in the process. The Belt and Road framework provides an alternative market for China’s vast state-owned companies beyond the borders of China.
Finally, the Belt and Road is seen as a crucial element in the Chinese government’s efforts to stimulate economies of the country’s central provinces, which historically lag behind richer coastal areas. The government uses the Belt and Road to encourage and support businesses in these central regions, allocating budget generously, and encouraging businesses to compete for Belt and Road contracts.
Why is it called the ‘Belt and Road’ initiative?
The Belt and Road Initiative is a relatively new name. Initially it was referred to as two separate projects, then as the ‘One Belt, One Road’ initiative, then finally as the Belt and Road Initiative.
The Silk Road Economic ‘Belt’ element refers to plans for a revitalized series of ancient overland trading routes connecting Europe and Asia to be built largely with Chinese expertise. The idea was first proposed by Chinese president Xi Jinping during a visit to Kazakhstan in 2013, and central Asia is seen as the most vital region for the ‘Belt’ element.
In 2014 Xi Jinping outlined plans to additionally establish new sea trade infrastructure along the old Marco Polo route – a maritime silk road connecting China, Southeast Asia, Africa, and Europe. This would be a longer route avoiding the Malacca Strait, incorporating fuelling stations, ports, bridges, industry, and infrastructure through Southeast Asia and into the Indian Ocean. Pakistan is seen as perhaps the most crucial partner country in this effort through the China Pakistan Economic Corridor project.
The Belt and Road Initiative map
The Belt and Road Initiative in Asia
China views the BRI as vitally important in securing its borders on the Asian mainland. It has land borders with 15 nations, including unstable states such as Afghanistan and nations seeking new partnerships in opposition to the US, such as Russia. Belt and Road investments are viewed as a way to facilitate China’s ‘periphery diplomacy’ – trade and infrastructure partnerships with the countries along this enormous land border.
However, the idea of the Belt and Road forming a coherent China-led block in opposition to the US is not necessarily accurate. Russia may not be a viable partner as it sees former Soviet Union states such as Kazakhstan, Kyrgyzstan, Uzbekistan, and Turkmenistan as belonging to its own sphere of influence, and China’s proposed Belt challenges Russian power in the region.
Other serious opponents to the initiative in Asia include India as a key partnership in the Belt and Road is between China and Pakistan, a nation China calls a ‘all-weather friend’. The China-Pakistan Economic Corridor runs close to the disputed Kashmir region, creating an alliance of two nuclear armed neighbours forging territorial links on India’s northern border.
The Belt and Road Initiative in Malaysia
Malaysian projects played a key role in feeding the narrative that the BRI is synonymous with corruption. Former Malaysian prime minister Najib Razak signed the East Coast Rail Link (ECRL) infrastructure deal with China, part of a broader Belt and Road vision of a united Southeast Asian railway network.
The scheme became associated with a broader corruption scandal involving Razak and was cancelled. However, Malaysia has not rejected the initiative or ruled out further involvement, and the ECRL issues are largely perceived as merely local corruption.
The Belt and Road Initiative in Africa
China’s banks have funded numerous projects in Africa, including a major gas pipeline and railways in Nigeria, plus projects in Uganda, Egypt, Ethiopia and many other countries.
The Belt and Road Initiative in Kenya
The centrepiece of the Kenyan government’s participation in the initiative is a high-speed railway running between Mombasa and Nairobi, the first high-speed railway on the African continent.
Built by the Chinese, the project has provided jobs and training for a local workforce to operate the railway – but also created serious questions about the country’s ability to service the Chinese loans which paid for the railway and Kenya’s broader debt obligations to China.
The Belt and Road Initiative in Europe
One of the aspects of the Belt and Road Initiative that most alarmed western commentators is its extension of Chinese influence into developed European nations such as Greece and Italy, a G7 nation.
The Belt and Road Initiative in Greece
Following the 2008 financial crisis, Greece suffered a prolonged period of economic instability and worsening relations with the European Union. In 2016, China’s shipping firm, Cosco purchased a majority stake in the Piraeus port, Europe’s seventh biggest harbour. Then in August 2018, Greece announced it was formally joining the BRI.
The Belt and Road Initiative in Italy
In March 2019 a populist coalition government led by the Five Star Movement agreed to bring Italy officially into the Belt and Road Initiative, signing a memorandum of understanding with Xi Jinping in Rome. Italy and Greece’s participation in the Initiative alarmed the US.
However, the Italian collaboration remains thin on actual detail, with the memorandum of understanding full of warm diplomatic language and acknowledgements of existing collaborations. Further, Mario Draghi, prime minister of a new government in 2021, signalled Italy may withdraw from the initiative.