The Belt and Road turns five

Abstract

China's Belt and Road Initiative (BRI) is an international trade and development strategy. Launched in 2013, it is one of the ways that China asserts its role in world affairs and captures the opportunities of globalization. The BRI has the potential to enhance development prospects across the world and in China, but that potential might not be realized because the BRI's objectives are too broad and ill-defined, and its execution is too often non-transparent, lacking in due diligence and uncoordinated. This article documents the background and context of the BRI, recounts what is known about the extent of the initiative and specifies its various motivations. It highlights that the initiative meets very large infrastructure investments gaps, which is welcome and needed, and that China's goal of forging stronger links with its trading partners around the world are legitimate, so long, of course, as the underlying intent remains peaceful. Though many observers welcome the BRI, many others oppose it for good reasons, while others misunderstand it and oppose it for bad reasons. The paper identifies and discusses concerns about the initiative that relate to its geopolitical objectives, its priorities, its geographic scope, the role of state-owned enterprises, the allocation of resources, issues of transparency and of due diligence. Particularly, it shows that this initiative deals with a vast number of countries that are in very different states of development and that an apparent lack of well-defined priorities is holding the initiative back. The paper also highlights the issue of debt overload which is distressing several BRI countries and discourages further projects. It points briefly to possible improvements that China and the other stakeholders in the BRI can make to get the most out of their investments. The BRI, to be effective, needs to meet the basic conditions of a trade and development strategy, which are clear objectives, adequate resources, selectivity, a workable implementation plan, due diligence and clear communication. Involvement of multilateral lenders could help with this. Finally, China has to improve the evaluation of project's risks and costs and step up its due diligence approach to demonstrate that it respects the long-term interests of those countries that are at the receiving end of its BRI projects.