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October 2023
The Third Belt and Road Forum for International Cooperation wrapped up in Beijing last week, having drawn representatives from over 130 countries and more than 30 international organisations – including some two dozen heads of state and government.
As the Belt and Road Initiative (BRI) marks its tenth anniversary, President Xi Jinping’s keynote address reflected on the project’s achievements to date and outlined a roadmap for future development. In the coming years, the Chinese leader envisages eight priorities for diversifying and enhancing connectivity across the entire transnational BRI ecosystem, with a focus on supporting an open world economy, promoting green development and scientific innovation, and encouraging institution building.
A brief history of the Belt and Road
China hosted the previous two forums in 2017 and 2019. This year’s third forum, taking place at the ten-year milestone, marks a significant watershed.
When the BRI was first unveiled a decade ago, during Xi’s visit to Kazakhstan, the global financial crisis was receding in the rear-view mirror and much of the world was riding a surging wave of globalisation. Still, most countries along the BRI route suffered from inadequate infrastructure and required substantial investment. Conditions were right for the BRI to emerge as the largest global platform for infrastructure development. According to a recent white paper released by the Chinese government, from 2013 to 2022, China and its BRI partner countries accumulated over 380 billion US dollars in two-way investment, with China’s outbound direct investment exceeding some 240 billion US dollars. Infrastructural development has gone hand-in-hand with booming international trade over the last decade. From 2013 to 2022, the total value of imports and exports between China and partner countries reached 19.1 trillion US dollars, with an average annual growth rate of 6.4 percent.
The way forward for the Belt and Road
The past decade has seen the Belt and Road Initiative emerge as a new framework for international investment and cooperation. The next phase in the story will focus on high-quality development.
China’s aspirations for multilateral engagement mean continuing to work with BRI partner countries to foster new platforms for cooperation in everything from energy, finance and green development, to disaster relief and anti-corruption.
No doubt, these are ambitious goals. So far, the BRI has often relied on a model in which participating countries receive large – sometimes unsustainable – commercial loans from China, which go towards funding grandiose construction projects, overwhelmingly undertaken by Chinese enterprises themselves. More superficial characteristics of the BRI would often fall back on the term “debt trap diplomacy”. Concerns do exist, both within participating countries and further afield, about China’s ultimate intentions. As the BRI continues to reinvent itself, more efforts will be needed to supplement the positive narrative with concrete changes in approach.
For its own part, China has pledged to open new areas for trade and investment in cross-border services, reform state-owned enterprises and expand market access to the country’s booming digital economy. Notably, China has also claimed it would remove all restrictions on foreign investment in its manufacturing sector.
High-quality development relies on effective policy communication and mechanism building. As the Belt and Road Initiative enters its second decade, we can expect more avenues of high-level communication to emerge between governments at all levels, state-owned national industries, and private enterprise across the transnational BRI network. And as the overall focus shifts from big-ticket infrastructure projects to high-quality sustainable development and innovation, both Chinese and foreign firms alike will encounter new trade and investment opportunities along this dynamic and ever more connected 21st century ‘Silk Road’.
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