Chinese leader Xi Jinping participates in the third Belt and Road Forum for International Cooperation in Beijing, showcasing his signature commitment to foreign policy as he enters his second decade. While Chinese infrastructure loans under the Belt and Road Initiative (BRI) have declined particularly in recent years, and many BRI projects have run into serious problems, predictions about their demise are wrong. Instead, the BRI will persist at least as long as Xi, described in state media this week as the “chief architect” of the initiative, is in power. This compilation in Beijing provides useful indications of how the BRI will evolve in the coming years.
The Belt and Road Initiative: Who is involved in it?
According to China’s first BRI white paper, released just ahead of this week’s Belt and Road Forum, Beijing has “signed more than two hundred BRI cooperation agreements with more than 150 countries and 30 foreign organizations on five continents. “However, keep in mind that not all countries that have signed a BRI MoU host BRI projects. Moreover, the BIS club does not guarantee that a country will get a preferential remedy from Chinese banks compared to its non-BIS neighbors, as Italy does. At the same time, such agreements are vital because they lend credibility to the BIS and are presented through Beijing as a stamp of approval.
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Similarly, high-level participation in the Belt and Road Forum sends a vital signal that China is leveraging to continue selling the BRI. In 2017, leaders from 29 countries traveled to Beijing to attend the first Belt and Road Forum, a number that increased. to 37 at the moment Belt and Road Forum in 2019. But this week, only 23 heads of state and government are present. , countries have less capacity to borrow more, and China’s preference for borrowing has declined.
When analyzing the list of participants, there are a few things worth highlighting. First, Russian President Vladimir Putin attended all three Belt and Road Forums, this time traveling to Beijing on his first outdoor foreign visit to the former Soviet Union since the International Conference. The Criminal Court issued an arrest warrant for him, a testament to the growing alignment between Beijing and Beijing. In fact, in the photo of all the leaders attending this year’s Belt and Road Forum, Putin is next to Xi in the front row.
Second, due to Putin’s presence and China’s continued aid to Russia, Western European countries almost unanimously chose not to participate in this conference. While leaders from the Czech Republic, Greece and Italy attended the first two Belt and Road forums, they did not travel to Beijing for this iteration. In the case of Italy, the only G7 country to join the BRI, its absence likely confirms that it will officially withdraw from the initiative in the coming months. The only leader of a European Union (EU) member state to participate in the Third Belt and Road Forum is Viktor Orban, who has attended all Belt and Road forums. According to China’s statement, in his meeting with Xi, Orban said that Hungary “will remain China’s trusted friend and spouse in the European Union” and “opposes any decoupling and disruption of trade and origin chains or the so-called “disengagement. practices”, which marks a break with the European Commission’s economic security strategy. Overall, however, China has failed to make a breakthrough with the BRI in Western Europe, and the absence of European leaders at this year’s forum highlights developing European skepticism toward Beijing. .
Third, the strong participation of the Global South shows where the BRI has (unsurprisingly) found maximum traction and where Beijing is likely to become increasingly concentrated in the coming years. Notably, the leaders of Pakistan, Indonesia and Sri Lanka (the latter two) after skipping the previous forum in 2019, attended the festivities in Beijing. This comes less than two months after Xi attended the BRICS summit in South Africa, effectively pressuring the organization to admit six more members (Argentina, Egypt, Ethiopia, Iran, Saudi Arabia). and the United Arab Emirates).
What does the next decade mean for the BRI?
Unlike skeptics who believe Beijing has left the BRI, China will press ahead with it. As stated in its white paper, “China will continue to promote the BRI as a comprehensive blueprint and high-level design for opening-up and win-win cooperation. “Indeed, in this document, Beijing calls the BRI a “key pillar” of Xi’s foreign policy vision, a “global network with a shared destiny. “
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While the BIS may not go away, its second decade probably won’t look like its first ten years. Chinese banks have learned the hard way that it is difficult to invest in infrastructure, especially in emerging countries. In fact, according to an analysis, more than one-third of BIS projects found primary problems. In many cases, threat tests and debt sustainability analyses conducted through Chinese financiers were either non-existent or outright flawed. These banks are not in the business of offering aid or charity, and as they run into problems, they are more selective in what they fund. As a result, the days of BRI megaprojects are largely over.
As we noted in the report of our independent working group on the BRI, the initiative is likely to be simpler, more targeted and more cost-effective, and consist of less complicated projects. This year’s forum, which hosts 3 high-level meetings on connectivity, Green Progression, and the Virtual Economy, provides a concept of the direction Beijing plans to take for the BRI. There will likely be fewer railways, ports, and airports, and more emphasis on virtual connectivity, standard-setting, educational courses, and connection. But just because the BIS is evolving doesn’t mean it will have fewer consequences; In fact, “soft connectivity” can equally provide Chinese entities with significant benefits over their competition, while selling Chinese criteria of global governance.
China’s appetite for funding megaprojects may have waned, but it likely also sees the BRI as an increasingly vital tool it can leverage amid the looming dispute between the United States and China. Porcelain. In particular, China will most likely turn to the BRI to continue construction aid in the Global South, hoping to form a counterweight to the US-led foreign order. Much of China’s recent white paper can be seen as addressing the Global South, for example when it states that “economic globalization dominated by a few countries has not contributed to a not unusual progression that benefits all. . . Many emerging countries have benefited little. ” Xi reiterated the importance of economic globalization and they have even lost their capacity for independent progress, making it difficult for them to access the path of modernization. Some countries have practiced unilateralism, protectionism and hegemonism, hampering economic globalization and threatening a global economic recession. to “promote South-South solidarity” in his meeting with Ethiopian Prime Minister Abiy Ahmed Ali on the sidelines of the Belt and Road Forum and said the two countries deserve to “firmly help each other on issues affecting their respective basic interests”. and primary concerns.
The BRI would likely have struggled in its first decade and is in the process of withdrawing, but Xi still sees it as a vital tool for advancing Chinese strength and influence amid an escalating conflict with the United States. In the coming years, the price of the BRI for Xi will also rise.