Belt and Road Ini­tia­tive for global ben­e­fit

... both China and the US should work closely to im­prove global in­fra­struc­ture and eco­nomic in­te­gra­tion ...

China Daily (USA) - - VIEWS -

The in­ter­na­tional com­mu­nity hopes the G20 sum­mit in­Hangzhou, East China’s Zhe­jiang prov­ince, will raise global in­vest­ments and op­ti­mize the use of fi­nan­cial mech­a­nisms. And given its framework, the G20 should viewthe China-pro­posed Belt and Road Ini­tia­tive and Asian In­fra­struc­ture In­vest­ment Bank as a boon for sta­bi­liz­ing the fal­ter­ing world econ­omy.

The Belt and Road Ini­tia­tive, the Silk Road Eco­nomic Belt and 21st Cen­tu­ryMar­itime Silk Road, is es­sen­tially aimed at pro­vid­ing ef­fi­cient sup­ply for stim­u­lat­ing fresh de­mand, with a fo­cus on in­fra­struc­ture in­vest­ment in both de­vel­oped and de­vel­op­ing economies. That many coun­tries, rang­ing from theUnited King­dom to the ASEAN mem­bers, have shown in­ter­est in en­dors­ing the Belt and Road Ini­tia­tive high­lights their de­sire to use in­no­va­tive means to im­prove their do­mes­tic in­fra­struc­ture.

But the loose eco­nomic coali­tion needs fi­nan­cial in­sti­tu­tions such as the AIIB and the BRICS NewDevel­op­ment Bank to co­or­di­nate the par­tic­i­pa­tion of govern­ments, en­ter­prises and other in­sti­tutes, as well as to di­ver­sify fi­nanc­ing chan­nels. Apart from the two in­ter­na­tional banks led by China, the coun­try’s State-owned and com­mer­cial banks, too, have a role to play in im­ple­ment­ing the Belt and Road Ini­tia­tive, which fea­tures pub­lic-pri­vate part­ner­ship, or PPP.

Take for ex­am­ple the AIIB, the first multi­na­tional fi­nan­cial in­sti­tu­tion es­tab­lished on Bei­jing’s pro­posal. It has the po­ten­tial to deepen global po­lit­i­cal and eco­nomic co­op­er­a­tion and pro­vide funds for the in­fra­struc­ture projects for the Belt and Road Ini­tia­tive.

Shar­ing the pur­suit of boost­ing in­fra­struc­ture in­vest­ment, both the Ini­tia­tive and the AIIB pledge to make global gov­er­nance “lean, clean and green”, en­dorse open re­gion­al­ism, and are com­mit­ted to re­al­iz­ing theUnit­edNa­tions Sus­tain­able Devel­op­ment Goals by 2030.

But it is not true that they are af­fil­i­ated to or sub­ject to one an­other, a pop­u­lar mis­read­ing among some China ob­servers who can­not ac­cept China’s rise and be­lieve its par­tic­i­pa­tion in global gov­er­nance comes with grave se­cu­rity risks. Some­have even playedupBei­jing’s so-called chal­lenge to theWashington-led world or­der, call­ing the BeltandRoad­Ini­tia­tive­andthe AIIB a threat to the en­vi­ron­men­tandthe rule of law.

The fact is, China still needs the sup­port of theUnited States, the world’s largeste­con­omy, to carry for­wardits strate­gic plans, although someUS politi­cians re­main sus­pi­cious of the in­ten­tion­sand­fea­si­bil­ity of the BeltandRoad­Ini­tia­tive. There­fore, more­mea­sure­shave to be taken to con­vincethemthat sta­bi­liz­ing global growth is in­China’s own­in­ter­est.

ButWash­ing­ton, onits part, also has to learn a les­son or two from its failed at­tempts to dis­suade­s­omeof its close al­lies, like theUK, from join­ing the AIIB. Inother words, both­Chi­naandtheUS should­work closely to im­prove global in­fras­truc­ture­an­de­co­nomic in­te­gra­tion, in a bid to up­grade their bi­lat­eral ties.

TheUS is a world leader in build­ing soft in­fra­struc­ture, rang­ing from ca­pac­ity buildin­gand­skills de­vel­op­mentto le­gal sys­tems, while Bei­jing hasanequally im­pres­sive record in in­fra­struc­ture con­struc­tion, in­clud­ing trans­portandt­elecom­mu­ni­ca­tions, es­pe­cially in re­cent years.

The two­sides, there­fore, should learn from each other to bridge the widen­ing gap be­tween­thede­mand for in­ter­na­tional pub­lic good­sand the in­suf­fi­cient sup­ply, which is ex­act­ly­whatthe BeltandRoad­Ini­tia­tive seeks to achieve.

InAsia alone, at least$8tril­lion are needed for in­fra­struc­ture projects over the next 5 to 10years to im­prove con­nec­tiv­ity. So the newly es­tab­lished AIIB with a cap­i­tal of $100 bil­lio­nandthe$40bil­lion Silk Road­Fund­should be­wel­comed rather than op­posed by rel­e­vant coun­tries. The au­thor is a pro­fes­sor of in­ter­na­tional re­la­tions at Ren­min Univer­sity of China.


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