China’s Belt Road Initiatives (“BRI”): A Tale of Opportunities?

On 7 September 2013, China’s President Xi Jinping spoke at Kazakhstan’s Nazarbayev University on a Silk Road Economic Belt. This was then renamed the Belt and Road Initiative. New roads, highways, ports, gas pipelines and industrial parks were to be created for recipient countries. Total investments under the BRI is estimated at USD1 to USD2 trillion over a 10-year period. As many as 80 countries and organisations have signed on to the BRI. Response has been from guarded optimism to some measure of scepticism.

The BRI has six economic corridors:

(i)         China-Pakistan Economic Corridor;

(ii)        China-Mongolia-Russia Economic Corridor;

(iii)       China-Central Asia-West Asia Economic Corridor;

(iv)       New Eurasia Land Bridge;

(v)        China-Indochina Peninsula / ASEAN; and

(vi)       Bangladesh-China-India-Myanmar Economic Corridor

The idea is for unimpeded trade, financial integration, people exchanges, connectivity and policy coordination. Opportunities for ASEAN in bilateral trade with China has grown from USD9 billion in 1991 to USD346 billion in 2015. Tourists from China to ASEAN has increased with BRI, a total of 21% of all tourist arrivals in 2017 from 12% in 2012.

The biggest threat lies in U.S.-China trade relations and China’s continued economic growth. Caution may also be required on China’s terms for loans extended to developing countries. On balance, BRI is a plus to the region with America’s increasingly protectionist stance.

Source: https://www.scmp.com/infographics/article/1874865/infographic-one-belt-one-road