China’s Belt and Road Initiative Marks Its 2nd Decade
While high-level participation at this year’s Belt and Road forum has waned, the BRI continues to garner support in the Global South, positioning Beijing to fortify the Global South as an alternative to the U.S.-led international order.
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All heads of delegation at the 2023 Belt and Road Forum in Beijing, China.
China’s Belt and Road Initiative Marks Its 2nd Decade
Chinese leader Xi Jinping is convening the third Belt and Road Forum for International Cooperation in Beijing, highlighting his hallmark foreign policy endeavor as it embarks on its second decade. Despite a substantial decrease in Chinese lending for infrastructure projects falling under the Belt and Road Initiative (BRI), and the various challenges some BRI projects have encountered, forecasts of BRI’s demise are unfounded.
Instead, BRI is poised to endure for at least as long as Xi, who was recently described in state-run media as the initiative’s “chief architect,” remains in power. This assembly in Beijing offers valuable insights into the future trajectory of the BRI in the years ahead.
The Belt and Road Initiative – Who Is on Board?
As outlined in China’s inaugural white paper on the Belt and Road Initiative, unveiled just before this week’s Belt and Road forum, Beijing has “established over 200 BRI cooperation agreements with more than 150 countries and 30 international organizations spanning five continents.” However, it is crucial to note that not every nation that has inked a BRI memorandum of understanding is a host to BRI projects.
Furthermore, participation in the BRI doesn’t automatically ensure favorable treatment from Chinese financial institutions when compared to non-BRI nations, exemplified by Italy’s experience. Nevertheless, these agreements remain significant as they bolster the credibility of the BRI and are emphasized by Beijing as a mark of endorsement.
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Similarly, the notable level of attendance at the Belt and Road Forum serves as a significant signal of support that China strategically employs to promote the BRI. In 2017, 29 heads of state from various countries journeyed to Beijing to participate in the inaugural Belt and Road Forum, a number that increased to 37 for the second gathering in 2019.
However, during this week’s third Belt and Road Forum, the count has diminished, with only 23 heads of state and government in attendance. This decline in participation is a strong indicator that enthusiasm for the BRI has diminished. It can be attributed to challenges faced by major projects, reduced capacity of countries to take on additional debt, and China’s decreasing desire to extend lending.
World Leader Attendance at Belt and Road Forums
China’s Belt and Road Initiative has found most support in the global south, while interest in the initiative has declined in Europe.
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Analyzing the list of attendees reveals a few noteworthy points. First, Russian President Vladimir Putin’s consistent presence at all three Belt and Road forums underscores the deepening alignment between Beijing and Moscow. In a remarkable display of this rapport, Putin’s attendance in Beijing comes amidst international legal matters. He stands alongside Xi in the front row in the forum’s group photo.
Second, due to Putin’s participation and China’s ongoing support for Russia, the majority of Western European nations opted not to attend this time. Notably, leaders from countries like the Czech Republic, Greece, and Italy, who were present at the first two Belt and Road forums, are conspicuously absent in Beijing for this event. Italy, the sole G7 nation engaged in the BRI, likely signals its impending withdrawal from the initiative in the months ahead through its non-participation.
The solitary leader from a European Union (EU) member state attending the third Belt and Road Forum is Viktor Orban, a consistent presence at these forums. During his meeting with Xi, Orban expressed Hungary’s commitment to being China’s trusted friend and partner within the European Union.
He also voiced opposition to the decoupling of supply and industrial chains and ‘de-risking’ practices, deviating from the European Commission’s economic security strategy. Nevertheless, China’s progress with the BRI in Western Europe has been limited, and the absence of European leaders at this year’s forum underscores the growing skepticism of Beijing within Europe.
Furthermore, the notable presence of leaders from the Global South underscores the regions where the Belt and Road Initiative has predictably gained significant traction and where Beijing is likely to intensify its focus in the years ahead. It’s worth highlighting the participation of leaders from countries such as Pakistan, Indonesia, and Sri Lanka, with the latter two returning to the forum after missing the 2019 event.
These developments occurred less than two months after Xi’s participation in a BRICS Summit held in South Africa, where he successfully advocated for the admission of an additional six member countries (Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates).
What Lies Ahead for the Belt and Road Initiative in the Next Decade?
In contrast to doubters who speculated that Beijing had shifted away from the Belt and Road Initiative (BRI), China remains steadfast in its commitment to advance this endeavor. As articulated in its white paper, China affirms, “China will persist in promoting the BRI as its comprehensive framework and top-level strategy for fostering open and mutually beneficial international collaboration.” Furthermore, the white paper characterizes the BRI as a “central pillar” of Xi’s foreign policy vision, representing a vision for a “global community of shared future.”
Although the Belt and Road Initiative (BRI) is here to stay, its second decade will see substantial changes compared to its initial ten years. Chinese financial institutions have learned from their challenges, especially when investing in infrastructure in the developing world.
In fact, around one-third of BRI projects have encountered significant issues. In many cases, risk assessments and debt sustainability analyses by Chinese financiers were either lacking or significantly inaccurate. These banks do not engage in philanthropy but seek strategic investments, becoming more discerning in their funding choices. Consequently, the era of massive BRI infrastructure projects is mostly behind us.
As outlined in our Independent Task Force report on BRI, the initiative is expected to become more streamlined, precise, and cost-effective, focusing on less risky projects. This year’s forum, featuring high-level discussions on connectivity, sustainable development, and the digital economy, offers insights into Beijing’s evolving BRI strategy.
The emphasis is likely to shift away from large-scale railways, ports, and airports, in favor of digital connectivity, standards development, capacity-building programs, and people-to-people exchanges. However, this shift doesn’t mean that BRI will lose its significance; “soft connectivity” can provide Chinese entities with considerable advantages and promote Chinese global governance norms.
China’s appetite for funding massive infrastructure projects may have diminished, but it still regards BRI as a vital tool in the face of growing competition with the United States. China is expected to turn to BRI to strengthen its support in the Global South, potentially forming a counterbalance to the U.S.-led international order.
Much of China’s recent white paper seems aimed at addressing the Global South, emphasizing the need for more inclusive and equitable economic globalization. Xi also stressed the importance of “promoting South-South solidarity” in discussions with Ethiopian Prime Minister Abiy Ahmed Ali during the Belt and Road forum, highlighting mutual support on core interests and major concerns.
While BRI has faced challenges in its first decade and is adjusting as a result, Xi Jinping still perceives it as a crucial tool for advancing Chinese influence and power amid escalating competition with the United States. As U.S.-China competition is expected to intensify in the coming years, the value of BRI for Xi is likely to increase.