China’s Trillion-Dollar Foreign Policy
To hear the world leaders who gathered in Beijing boast about China’s ambitious plans to spend more than $1 trillion on roads, ports, energy and other major projects in 60 countries, linking Asia, Europe and Africa, is to be reminded how America’s vision and influence have shrunk under President Trump. While Donald Trump pushes an America First agenda of isolationism and protectionism and embroils himself in controversies that raise doubts about his competence, President Xi Jinping of China exudes purpose and confidence as he tries to remake the global economic and political order and lure nations into Beijing’s orbit.
Mr Xi held the Beijing forum to showcase his One Belt, One Road initiative, which is aimed at creating a modern version of the Silk Road, a network of trading routes from China to Africa and Europe. Dozens of world leaders, including President Vladimir Putin of Russia, attended. Many of them praised Mr. Xi’s vision, which he first voiced in 2013, and were enthusiastic about locating projects in their countries, financing them, building them or managing them. The plan offers many ways countries can participate; Britain and Singapore, for instance, seem eager to handle private financing.
China’s leader has advantages in promoting his agenda. He’s in control. His government has lots of money to invest. His propaganda machine is disciplined and relentless. And Mr Xi himself is a Barnum-like salesman. “Development holds the master key to solving all problems,” he said at the forum, as if One Belt, One Road were the ultimate cure-all. No less important, many countries are desperate for infrastructure investment and jobs. China itself is eager to open new markets to nourish its own growth and to absorb an overproduction of steel, cement and machinery. Completing just a small fraction of the projects could help lift millions of people out of poverty and stabilise poor nations.
Still, there are reasons to wonder how much of this grand plan can be achieved. There will be security risks in regions torn by sectarian and political warfare; legal obstacles in nations with different laws; and bureaucratic hurdles in countries with inept governments and corrupt officials. The biggest challenge of all may be financing. So far, investments have been focused on Pakistan, Afghanistan, Kazakhstan, Uzbekistan and other countries that are geopolitical priorities for China but have weak economies. Conference delegates expressed concern that such countries would find it hard to pay back loans from Chinese companies and banks and emphasised that more projects must be “high quality” and commercially viable.
There is also the issue of how local people feel about a project. Whatever the economic benefits, a project cannot be allowed to run roughshod over individuals or trample on the environment. Mr Xi stressed that consultation, transparency and people’s “well-being” are vital, but China’s track record is not encouraging. One example: Kyaukphyu, Myanmar, where a Chinese-Myanmar oil and gas pipeline was pursued in secret, stomped on farmers’ property rights and did significant environmental damage. China clearly aims to dominate the international system. If it succeeds—shaping how vast sums are spent and where, and which laws are followed or not—it could upend a system established by Washington and its allies after World War II. And there are military concerns: For instance, many Burmese and foreign experts worry that China could use the Kyaukphyu ports for military purposes.
Mr Trump has already ceded ground to Beijing by withdrawing from the Trans-Pacific Partnership that President Barack Obama negotiated to ensure that the United States and its allies set the rules for Asian trade. This has led many Asian countries to question America’s commitment to the region and to look more seriously to China. Like most of its Western allies, the United States has been wary of Mr Xi’s initiative. While Mr Putin sent himself, it was only at the last minute that the Trump administration upgraded its delegate to the forum from a Commerce Department functionary to Matthew Pottinger, Mr Trump’s senior Asia adviser. American companies eager for a share of the One Belt, One Road business hope for greater enthusiasm going forward so their interests will be protected. Whatever obstacles lie ahead for One Belt, One Road, it is no exaggeration to say that if the United States and its Western allies turn inward, Mr Xi could prevail by default.