China’s Belt and Road Initiative: opportunities and challenges
As the One Belt, One Road Summit opened in China last May 14, a new wave of opportunities and challenges emerged. The summit, initially, was supposed to burnish Chinese President Xi Jinping’s stature as a world-class statesman with his signature foreign policy thrust—shaping a future world order in which all roads lead to Beijing.
Xi envisions to reassert China’s past prominence as the dominant power in Asia whose culture and economy deeply influenced its neighbors and peoples as far as Africa and Europe. It speaks volumes of the Chinese’ pride in their country’s explosive economic growth and political clout after a century of humiliation at the hands of foreign powers that formally ended with Mao Zedong’s successful communist revolution in 1949.
The initiative also reinforces the Xi administration’s reputation for muscular foreign policy. Under Xi, China has strongly asserted its claim to virtually the entire strategic South China Sea; and he has established the Asian Infrastructure Development Bank as a global institution alongside such bodies as the World Bank, Asian Development Bank and International Monetary Fund.
I believe that the South China Sea claim has been loosely defined; it even appears to include more and more projects of peripheral importance and questionable value. Since so many of the states involved have weak economies and limited capacity for growth outside of mining, the potential for waste and corruption is high, raising the possibility of small returns on the vast sums being spent and massive losses for the Chinese state banks funding the projects.
Here is the danger: The initiative could also set back the goal of establishing a domestic economy centered on consumption rather than investment. Meaning, China’s investment priority should be at home, not abroad. It’s possible that such forward-leaping overseas investments would delay domestic development.
It is easy to just give out money; China has to prove that these projects are sound and they have the management expertise to carry them through.
In the Philippines, our foreign policy appears to dovetail with the United States’. President Duterte has assured Xi that it would be different this time and would see the establishment of closer economic ties with Beijing. We see a Philippines which is willing to adjust and realign its foreign policy in the name of trade. In fact, Mr. Duterte said earlier, “So we’re getting a relief now from our hardships because a lot of money is coming in.”
Meanwhile, beyond Asean-related issues, the only key international issues directly affecting the region involve the Korean Peninsula, the South China Sea, maritime security cooperation, terrorism and extremism.
RICARDO E. CATINDIG, [email protected]
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