Belt and Road Initiative

• China's Belt and Road Initiative (BRI) aims to reroute global trade.
• The BRI is intended to establish China as the next world superpower.

Origin

• In 2013, President Xi Jinping referenced the Ancient Silk Road in a speech in Kazakhstan
• Xi Jinping proposed building an "economic belt along the Silk Road".
• A month later in Indonesia, Xi mentioned building a "maritime silk road for the 21st century”.
• These proposals marked the start of the BRI.

Components

• The BRI has two main components:
  • The overland Economic Belt consists of six corridors.
    • These corridors serve as new routes for goods entering and exiting China.
    • Examples include a railroad connecting China to London and gas pipelines from the Caspian Sea to China.
  • The Maritime Silk Road.
    • It is a network of seaports stretching from the South China Sea to Africa.
    • This network is designed to direct trade to and from China.

Additional Infrastructure

• The BRI encompasses:
  • Oil refineries
  • Industrial parks
  • Power plants
  • Mines
  • Fiber-optic networks.
  • All infrastructure is designed to facilitate global trade with China.

Participation and Promotion

• Over 60 countries have reportedly signed agreements to participate in BRI projects.
• China promotes the initiative as a mutually beneficial arrangement for all involved parties.

Pakistan as a Flagship Project

• Pakistan exemplifies the BRI's impact:
  • In 2001, China proposed constructing a new port in Gwadar.
  • By 2018, the port, along with highway and railway networks, evolved into a $62 billion corridor within the BRI.
  • The project benefits both Pakistan and China.
  • Pakistan experienced its highest GDP growth in eight years and strengthened its relationship with China.
  • China gained an alternative route for goods, particularly oil and gas from the Middle East.
  • The BRI boosted the Chinese economy.
  • Chinese construction companies experienced growth through BRI contracts.
  • Seven of the world's ten largest construction firms are now Chinese.

Conditions

• The trade balance is tipped in China's favor by requiring its involvement in BRI projects.
• Chinese workers directly undertake projects like highways, and firms collaborate on railways.
• China's involvement is one of its few demands.
• Unlike Western investment, China offers loans with fewer ethical standards.
• The BRI has gained popularity among less democratic countries.
• China has agreements with authoritarian governments, military regimes, and countries facing conflict.

Risks

• Experts consider the BRI a risky plan due to lending to unreliable countries.
• Repayment from indebted countries is uncertain due to corruption and conflict.
• A report indicates that several countries indebted to China are vulnerable, with eight at high risk of default.

Strategic Goals

• China loaned Sri Lanka $1.5 billion for a deep-water port, a key stop on the Maritime Silk Road.
• When Sri Lanka couldn't repay the loan, it granted China control of the port through a 99-year lease.
• China controls a strategic port in Pakistan with a 40-year lease and seeks a similar agreement in Myanmar.
• China established a naval base in Djibouti.
• These actions align with the String of Pearls theory, suggesting China's intent to establish naval bases in the Indian Ocean to protect shipping routes.

Impact

• China's growing influence challenges the United States' status as the sole superpower.
• The US is trending towards isolation, reducing investment and global influence.
• The BRI is China's strategy to leverage power and become a global leader through relationships and control of global trade.