Opinion

Integrating international economic development


Published : 08 Mar 2022 09:40 PM

International attention over the past two years has been given in particular towards monitoring very carefully the efforts being undertaken by China with regard to investment, security and economic integration. The consequences of Brexit and the change in leadership in Germany and Japan have also added different dimensions to this evolving horizon.

This has applied especially pertaining to the Belt and Road Initiative (BRI) initiated by China – a development strategy aimed at enhancing the global infrastructure paradigm. It includes investments in ports, railroads, roads, bridges, airports, dams and coal-fired power stations.

Introduced by the Chinese government in 2013, it has now become an important factor for nearly 70 countries and several international organizations. It is also perceived as an important aspect related to the foreign policy matrix associated with Chinese President Xi Jinping’s dream of China assuming a greater leadership role in global affairs.  Along with policy coordination, facilities connectivity, unimpeded trade and financial integration, people-to-people bonds are among the five major goals of BRI. The initiative was subsequently incorporated in 2017 within the parameters of the Chinese Constitution as a factor that aims to "enhance regional connectivity and embrace a brighter future." 

It is believed by China that the Belt and Road Initiative can reduce the infrastructure gap and would assist to create a unified large market by making better use of both international and domestic markets, through integration and mutual understanding that would help in more accountable capital inflows and technology. 

However China has not been alone in trying to establish such an international cooperative venture. The United States has similarly initiated an interesting counter-initiative called the FOIP which aims to promote greater connectivity between countries within the Indo-Pacific dimension. US officials have articulated the strategy as having three pillars – security, economics, and governance. At the beginning of June 2019, there has been a redefinition of the general definitions of "free" and "open" into four stated principles – respect for sovereignty and independence; peaceful resolution of disputes; free, fair, and reciprocal trade; and adherence to international rules and norms.

Some countries, including the United States however view the Chinese project critically because of possible expansion of Chinese economic and political influence that will have an osmotic effect through the creation of a new global growth engine that will be directing its efforts associated with connectivity through different parts of Asia, Europe and Africa. 

In the context of the European Union, it needs to be understood that the EU and China have some similar areas of engagement- extensive intra-European infrastructure projects to adapt trade flows to current needs. Concrete projects (as well as their financing) are underway, which are to ensure the connection of the Mediterranean ports with the European hinterland. Details were decided between the stakeholders at the annual China-Central-East-Europe summit, which was launched in 2012.

This applies, for example, to the expansion of the Belgrade-Budapest railway line, the construction of the high-speed train between Milan, Venice and Trieste and connections on the Adriatic-Baltic and Adriatic-North Sea axis. Effort is also underway for Northern Europe and Central Europe to be also connected to the maritime Silk Road through many links. Measures are being taken to achieve this through logistic networking via the Adriatic ports and Piraeus to East Africa and China.

One also needs to refer to another interesting fact as to how BRI has expanded in terms of its objectives since 2019. In March 2019, Italy became the first member of the G-7 nations to join the BRI. In April of that year and during the second Arab Forum on Reform and Development, China engaged in an array of partnerships called "Build the Belt and Road, Share Development and Prosperity" with 18 Arab countries. This was an important movement forward. Similarly, many African countries also consider BRI as a good constructive opportunity for independence from foreign aid and influence.

Some European countries have however voiced ambivalent opinions. Germany during Merkel’s Administration declared that the BRI "must lead to a certain reciprocity, and we are still wrangling over that bit". In January 2019 French President Macron also underlined that the BRI was an interesting initiative but China has to understand that reciprocity in terms of importing Chinese products need to be accompanied by purchase of French products and " roads cannot go just one way." The European Commission and Japan have also signed an infrastructure agreement in September 2019 to counter China's Belt and Road Initiative and link Europe and Asia to coordinate infrastructure, transport and digital 

projects.

Such a combined effort in Europe has not however taken place in Asian Far East. It may be mentioned that Vietnam has historically has been at odds with China. This has resulted in that country being somewhat indecisive about supporting or opposing BRI. Similarly, the South Korea is also trying to develop the "Eurasia Initiative" (EAI) as its own vision for East–West connectivity. In calling for a revival of the ancient Silk Road, the main goal of that country has been to encourage a flow of economic, political, and social interaction with Europe. South Korea has recently also announced another foreign policy initiative, the "New Southern Policy" (NSP), which seeks to strengthen relations with Southeast Asia. It is quite apparent that China has been carefully following the measures being undertaken to ascertain how much this will create obstacles for them. As a wealthy country, Singapore does not need massive external financing or technical assistance for domestic infrastructure building, but has repeatedly endorsed the BRI and cooperated in related projects in a quest for global relevance and to strengthen economic ties with BRI recipients. It may also be mentioned that it is one of the largest investors in the project.

Some criticism has however emerged about the BRI, and some climatologists and socio-economists have been critical about how some BRI projects are unfortunately contributing towards pollution and environmental degradation in some relatively poorer countries who are disregarding the consequences. This has surfaced particularly after the latest COP Conference held last year. Many, in this context have referred to Serbia, where pollution-related deaths already top Europe. They have claimed that the presence of Chinese-owned coal-powered plants over there have resulted in an augmentation of that country's dependency on coal, as well as air and soil pollution in some towns. German environmental group Urgewald has pointed out that China's energy companies will make up nearly half of the new coal plant generation expected to go online in the next decade.

Chinese authorities have however differed in this regard and claimed that such criticism is unwarranted. They have recalled that in 2017, while opening the Belt and Road Forum for International Cooperation Xi Jinping had stated that the BRI would "pursue the new vision of green development and a way of life and work that is green, low-carbon, circular and sustainable" in accordance with the goals of the 2030 Agenda for Sustainable Development and this would be followed to avoid the adverse effects of Climate Variability. 

In keeping with such a positive trend of mind one has to remember that the Belt and Road Initiative International Green Development Coalition (BRIGC) was launched during the 2nd Belt and Road Forum for International Cooperation in April 2019. It was clarified that integrated efforts would be undertaken to "integrate sustainable development, in particular environmental sustainability, international standards and best practices, across the... priorities of the Belt and Road Initiative". 

Nevertheless, some scholars are still unsure whether these best practices are being implemented properly. Their anxiety arises from the fact that most of the BRI-specific environmental protection goals are outlined in informal guidelines rather than legally binding policies or regulations. Moreover, member nations may choose to prioritize economic development over environmental protections, leading them to neglect to enforce environmental policy or lower environmental policy standards. 

China needs to ensure how additional risks are not generated, and also draft an agreement between participating nations to ensure culpability within this dynamic. Ending the financing of overseas coal-fired power plants by China would definitely help.

It would be pertinent at this point to refer to the efforts undertaken by China in the creation of the Asian Infrastructure Investment Bank (AIIB) in this regard. First proposed in October 2013, the Articles of Agreement, the legal framework of AIIB, were signed in Beijing on 29 June 2015. The Bank began operation on 16 January 2016 and has an authorized capital of $100 billion. China is the single largest stakeholder, holding 26.63% of voting rights. It needs to be mentioned that the primary goals of AIIB are directed towards addressing the expanding infrastructure needs across Asia and enhancing regional integration and promoting economic development required in this regard.

As expected, any international effort may be seen from different political perspectives based on national and group interests. Nevertheless, whatever be the dynamic, we in Bangladesh value our friendship with China and have positive thoughts about BRI and the associated efforts to strengthen areas of constructive engagement.


Muhammad Zamir, a former Ambassador, is an analyst specialized in foreign affairs, right to information and good governance