TCSS Security Commentaries #036

Xi’s BRI was marketed to the world as an opportunity to connect the global economy with China at its center. Ten years on, however, the realities of slowing growth at home and an economic downturn internationally mean this vision has had to be recalibrated.

Ethan Pooley and Italo M. de Queiroz, Interns, TCSS.

Source: The New York Times

In mid-October the Belt and Road Forum (BRF) was back on in Beijing to celebrate its tenth birthday. With representatives from 130 countries in attendance, the forum again demonstrated the Belt and Road Initiative’s (BRI) truly global reach – even if there were fewer leaders in attendance this year – 27 down from 37 the last time the forum was held in 2019. However, comparing this year’s BRF with its previous iterations, where it seemed any and all projects, sectors and geographies were within the BRI’s scope, there was a noticeable shift to realign its purpose.

How did we get here?

The BRI, and its projects, burst onto the international stage in 2013 – formerly known then as the ‘Silk Road Economic Belt’ and ’21st Century Maritime Silk Road’, or the ‘One Belt One Road’ – and have occupied a central place within international politics and news and scholarly analysis since. This is a testament to both its inspiring ambition – in which the plan is expected to source over USD$1 trillion worth of investment – and a style of marketing that the Chinese do best. 

But projects under the BRI began even before 2013. Infact, its origins date back to the 1990s as the National Development and Reform Commission – the institution through which Beijing coordinates infrastructure investment – began investing heavily in domestic projects. As the 2010s came around, these projects had produced incredible achievements that linked the country through a series of, among other things, ports, power stations, bridges, highways and railways. This success, however, brought with it an issue – the PRC’s infrastructure sector had outgrown itself. So, striving to continue achieving its target of double digit economic growth, the PRC looked outwards – offering its own model of infrastructure development that had been tried and tested domestically. By 2012, the year Xi came to power, the PRC already stood as the fourth largest country for outward ‘foreign direct investment’ (FDI) with USD$82 billion.

Then, looking to cultivate a legacy and attach achievements to his name, Xi Jinping announced the BRI which brought the PRC’s international investment activity under a singular, somewhat coherent framework. Since then, the PRC bureaucracy has thrown itself into organising and expanding the list of projects and locations its investment reaches. Currently, 150 countries have signed their interest in participating in the initiative and, the PRC says, it has created 420,000 jobs. Moreover, it is undeniable that successful projects under the BRI have brought with them results, for both the PRC and the recipient countries, that otherwise would not have been possible.

Controversy 

Confusing the BRI was the fact that the period surrounding the time it was announced coincided with Beijing’s increased assertiveness in international politics – marked by tension and territory claims in the South China Sea and East China Sea, a beefing up of its military, and the emergence of wolf warrior diplomacy. This saw the BRI interpreted as evidence of the PRC’s geo-political playbook that would see it first expanding its economic interests, then capitalising on these to establish strategic influence. This realist assessment induced a sense of insecurity that led many nation’s of the global north to refuse expressing their interest in participating in the plan. 

This insecurity is best summed up by the accusation that Beijing was engaging in ‘debt-trap’ diplomacy. From afar, this was a seductive argument – the authoritarian PRC is engaged in systematic exploitation of smaller states to expand their geo-political footprint – and became synonymous with the BRI when it was invoked frequently by senior Trump administration officials. On a closer look however, the idea was discredited. Whilst there had been instances of smaller countries making undesirable decisions to account for the debt they owed the PRC – such as giving the PRC the rights to key pieces of infrastructure – governments were not necessarily coerced and, at the end of the day, it is the responsibility of governments to make responsible governance decisions. Moreover, it is not in the PRC’s interest to have their loans go unpaid. So, whilst some of the controversy surrounding the BRI is unwarranted fear-mongering, the BRI projects themselves, and Beijing’s presentation of the plan, have not been successful enough and surely leave a stain on its reputation.

The Future of BRI 

With China’s economy has been showing signs of weakening, and increasing scepticism of China’s ambitions through the BRI, have significantly slowed the BRI’s apparent momentum in previous years. Several factors have contributed to this situation, including the ongoing trade war the PRC is engaged with against the United States and Europe, the Russian-Ukrainian conflict, the lingering effects of the pandemic, and the rising prices of commodities. These challenges have raised concerns for President Xi Jinping and have cast uncertainty on the success of the BRI.

During the recent BRF Summit, China made significant announcements about the future direction of the initiative. They emphasized that the future of the BRI would be ‘smaller’ and ‘greener.’ By ‘greener,’ China intends to channel more investments into renewable energy projects, promote technological innovation, and enhance efforts to digitalize the global economy. This marks a shift away from the massive infrastructure projects that the BRI has been known for, such as power plants, roads, ports, and railroads. Notably, China pledged to halt the construction of coal power plants, signalling its commitment to supporting green transitions. However, the country may still engage in large-scale projects to maintain its relevance.

China is considering a greater role for its private sector in the coming years within the framework of the BRI. In line with the principle of ‘smaller’, Xi might shift to involve fewer infrastructure projects and an emphasis on revitalizing or expanding existing projects that are partially completed. President Xi may also redirect the focus of the BRI towards projects that are primarily based in the Global South, with the aim of promoting a multipolar world order. This recalibration reflects China’s strategy to adapt to changing global dynamics. 

Ethan Pooley is a New Colombo Plan scholar undertaking an internship the Taiwan Center of Security Studies.

Italo Matos de Queiroz is an undergraduate student at Ming Chuan University, where he majors in International Affairs and Diplomacy and an intern at TCSS.