The Belt and Road Initiative (BRI) is arguably China’s most ambitious economic and diplomatic project since the founding of the People’s Republic of China. The brainchild of President Xi Jinping, the BRI is a strategic masterplan that envisions
The Belt and Road Initiative (BRI) is arguably China’s most ambitious economic and diplomatic project since the founding of the People’s Republic of China. The brainchild of President Xi Jinping, the BRI is a strategic masterplan that envisions upgrading trade links along the ancient Silk Road economic belt and building a modern maritime Silk Road. These trade routes are to connect China to countries in Asia, Europe and Africa through a network of roads, ports, bridges, tunnels, pipelines and other projects involving 68 states, two-thirds of the world’s population, and about a quarter of total global trade.
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The ‘belt’ represents land routes that would run through Central Asia and the Middle East before reaching Northern Europe. The ‘road’ represents sea routes that pass Southeast Asia, South Asia and Africa, before turning northward up the Suez Canal and terminating in the Adriatic Sea near Italy.
What has been the progress thus far on the ambitious BRI and why is China investing so much political and financial capital in it? And does Singapore have a role to play?
Diplomatic Milestone: Belt and Road Forum for International Cooperation
In a diplomatic charm offensive to shore up support for the BRI, China held the high-profile BRI Forum in May this year and invited 29 heads of state and government as well as officials, business and finance leaders and media from over 130 countries. It was the largest multilateral diplomatic event China has held in modern times.
The forum reviewed a list of outcomes achieved so far – 76 consensuses comprising more than 270 results in key areas such as policy, infrastructure, trade, finance and people connectivity. That notwithstanding, Chinese President Xi also reinforced his vision for the BRI as he pledged fresh funds of approximately US$100 billion for projects under the BRI. However, it was noteworthy that leaders from Europe and the US largely did not attend the forum, suggesting underlying geopolitical considerations in play. What does China itself hope to accomplish through the BRI?
BRI: More than a ‘Road’ and ‘Belt’
One major reason is gaining international economic influence and leadership. With the US retreating from its global economic role under the Trump Administration, the BRI is a means for China to implement its vision of a new global economic order and to promote China as an alternative to the inward-looking US. China has the opportunity to become the new champion of economic globalisation and partner international institutions such as the World Bank in meeting the needs of developing and developed countries.
By investing in infrastructure overseas, China also seeks larger gains for its vast foreign-exchange reserves, most of which are in low-interest-bearing American government securities. The Chinese government also hopes to create new markets for Chinese companies such as high-speed rail firms, and to export some of its vast excess capacity in cement, steel and other metals. High-profile infrastructure projects in Asia include the Jakarta-Bandung high-speed railway in Indonesia, China-Laos railway and upgraded Gwadar port in Pakistan.
Economic influence and geopolitical power go hand in hand, both of which China is working to expand. By investing in volatile countries in Central Asia via the BRI, China aims to create a more stable neighbourhood for its own restive western provinces of Xinjiang and Tibet. Beyond its borders, encouraging more BRI projects around the territorially-contested South China Sea in countries such as Malaysia could bolster China’s claims in that area. Further afield to the West, extending the BRI to European countries like Czech Republic and Poland allows China to build its presence in Europe at a time when transatlantic ties between the US and its European allies are under strain.
The BRI is also designed to enhance President Xi’s international standing and showcase his domestic strength on the road to the Chinese Communist Party’s (CCP) 19th Party Congress later this year, where he hopes to make his mark on the composition of the new Politburo (the top decision-making body within the CCP) and strengthen his primacy within the leadership. In 2016, Xi