Pres­i­dent Xi Jin­ping’s vi­sion of a Silk Road to boost China’s world po­si­tion faces ob­sta­cles

The Star Early Edition - - BUSINESS REPORT - Ting Shi

PRES­I­DENT Xi Jin­ping’s grand plan to make China the cen­tre of the world again by re­viv­ing the an­cient Silk Road trad­ing route faces ob­sta­cles at its first stop.

In Kaza­khstan, through which Xi en­vis­ages pipe­lines, roads and rail­ways re­vi­tal­is­ing an eco­nomic belt that stretches half way around the world to Venice, China has strug­gled to gain a sig­nif­i­cant foothold. It’s failed in ef­forts to re­alise a free trade agree­ment mooted 22 years ago and, in 2009, the Kazakh pres­i­dent was forced to deny a plan to lease farm­land to China after protests from a pub­lic wary of their neigh­bour’s grow­ing power.

What’s more, Xi’s vi­sion for a bloc that in­volves at least 60 coun­tries has left gov­ern­ment ad­vis­ers from Al­maty to Delhi largely in the dark about the de­tails. While Kaza­khstan’s lead­ers have voiced support, en­ticed by bil­lions of dol­lars in in­fra­struc­ture fund­ing, an­a­lysts in the coun­try say the strat­egy in­volves greater Chi­nese in­flu­ence that may be harder sell to its peo­ple.

“Xi’s pro­posed idea is to form the foun­da­tion of a new geopo­lit­i­cal con­cept of China,” Konstantin Sy­roezhkin, an ad­viser to the Kazakh pres­i­dent, said. “All dis­cus­sions be­fore were mainly around the eco­nomic com­po­nent of China’s re­la­tions with this re­gion, but Xi has put forth a vi­sion that is much broader.”

China’s leader is stak­ing po­lit­i­cal cap­i­tal on the Silk Road, which started from his home prov­ince of Shaanxi and rep­re­sented the golden years of Chi­nese civil­i­sa­tion. Dur­ing the Han Dy­nasty that ruled for four cen­turies from around 200BC and the Tang Dy­nasty from the 7th cen­tury, the route made China’s eco­nomic and trade prow­ess the envy of the world.

Chi­nese dream

It’s part of Xi’s “Chi­nese dream” to re­ju­ve­nate the Mid­dle King­dom and ex­pand its sphere of in­flu­ence beyond eco­nomics to pol­i­tics and cul­ture at a time when the US is seek­ing to re­assert it­self in the re­gion. A sec­ond, mar­itime, Silk Road that tra­verses the Horn of Africa en route to Europe, was later un­veiled by Xi in Jakarta.

Ear­lier this month, Xi pledged $40 bil­lion (R440bn) to set up a Silk Road Fund that will fi­nance the con­struc­tion of in­fra­struc­ture along the route.

The plan was hailed by Chi­nese man­u­fac­tur­ers such as equip­ment maker Zoom­lion Heavy In­dus­try Sci­ence and Tech­nol­ogy, which aims to raise the pro­por­tion of over­seas sales to to­tal rev­enue to be­tween 30 per­cent and 40 per­cent within five years from 10 per­cent at the mo­ment, Shang­hai Se­cu­ri­ties News re­ported yes­ter­day, cit­ing se­nior pres­i­dent Zhang Jian­guo.

Be­ing over­whelmed

China may need more than money to suc­ceed in places like Kaza­khstan, a for­mer Soviet state on China’s western bor­der, which is happy to do business with its neigh­bour but hasn’t been so keen on build­ing a close friend­ship.

“China is too pow­er­ful, too strong and we’re afraid of be­ing over­whelmed,” Nar­gis Kassen­ova, the di­rec­tor of the Cen­tral Asian Stud­ies cen­tre at KIMEP Univer­sity in Al­maty, said. “It’s hard to turn down on what China can of­fer, but we re­sist the full embrace of Chi­nese power. We’re just try­ing to ben­e­fit eco­nom­i­cally.”

China sur­passed Rus­sia as Kaza­khstan’s top trad­ing part­ner in 2010 and trade with the five for­mer Soviet republics in Cen­tral Asia has jumped more than 20 times to $46bn in 2012 from $1.8bn in 2000, ac­cord­ing to data from China’s Min­istry of Com­merce. Ly­ing on some of the big­gest oil and gas re­serves, Kaza­khstan signed co-op­er­a­tion con­tracts and deals worth $30bn last year to help slake its neigh­bour’s thirst for en­ergy.

When Xi vis­ited Kaza­khstan in Septem­ber last year, he out­lined a more com­pre­hen­sive re­la­tion­ship in a speech at the Se­nate Hall of Nazarbayev Univer­sity. Be­sides dan­gling the car­rot of an un­par­al­leled mar­ket of almost 3 bil­lion peo­ple along the New Silk Road Eco­nomic Belt to Europe, he urged all coun­tries in­volved to support each other on is­sues con­cern­ing sovereignty, ter­ri­to­rial in­tegrity and se­cu­rity, while cracking down on the “evil forces” of ter­ror­ism, ex­trem­ism and separatism.

“The Silk Road Eco­nomic Belt needs to be seen as a key part of the for­eign pol­icy legacy that Xi Jin­ping is build­ing for him­self,” Raf­faello Pan­tucci, the di­rec­tor of In­ter­na­tional Se­cu­rity Stud­ies at the London-based Royal United Ser­vices In­sti­tute, said. “It has the ef­fect of both help­ing the do­mes­tic sit­u­a­tion in western China, but also grow­ing China’s power and in­flu­ence across the Eurasian land­mass.”

Xi’s vi­sion

Not ev­ery­one rushed to lis­ten to Xi’s speech. Zhan­sul­tan Zham­bylov, a sec­ond-year bi­ol­ogy ma­jor stu­dent at the univer­sity, said he was too busy to go. “I prob­a­bly wouldn’t have gone any­way,” said Zham­bylov, an eth­nic Kazakh who speaks Rus­sian and Ger­man. “Some of my class­mates and friends went but said they didn’t quite get” what Xi’s vi­sion was.

Kaza­khstan’s gov­ern­ment was more re­cep­tive. Pres­i­dent Nur­sul­tan Nazarbayev called it “a won­der­ful con­cept” at a se­cu­rity sum­mit in Shang­hai in May. Prime Min­is­ter Karim Mas­si­mov de­liv­ered a speech in Chi­nese in Septem­ber in Urumqi, in China, in which he said that “sol­i­dar­ity will be our strength to de­velop re­gional co­op­er­a­tion along the Silk Road”.

Ties be­tween the neigh­bours have started to grow beyond the eco­nomic sphere into cul­tural and ad­min­is­tra­tive co­op­er­a­tion, with 2017 des­ig­nated as a year to boost tourism, Kaza­khstan has also shown in­ter­est in China’s anti-cor­rup­tion mea­sures, with a Chi­nese del­e­ga­tion vis­it­ing the cap­i­tal As­tana in Septem­ber to dis­cuss the fight against graft.

His­tory shows that Kaza­khstan’s lead­ers aren’t al­ways in step with popular opin­ion. China has un­suc­cess­fully pushed for a free trade agree­ment with Kaza­khstan since diplo­matic ties were es­tab­lished 22 years ago. More than a decade after Xi’s pre­de­ces­sor Hu Jin­tao and Nazarbayev reached a con­sen­sus in prin­ci­ple on the deal, lit­tle has tran­spired, while Kaza­khstan en­tered into a cus­tom union with Be­larus and Rus­sia in 2010.

A small trial area of 5.28 square kilo­me­tres was es­tab­lished in June this year in the bor­der city of Khor­gas.

In late 2009, after China pro­posed leas­ing a mil­lion hectares of farm­land, sev­eral hun­dred Kazakh pro­test­ers clashed with po­lice in Al­maty, wav­ing signs that read: “We will not give up Kazakh land!”

China has pushed for a free trade deal with Kaza­khstan since… ties were es­tab­lished 22 years ago.

Nazarbayev, who has been pres­i­dent since 1991, later de­nied the gov­ern­ment had any plans to lease land to China.

“The Kazakh gov­ern­ment might find they have po­lit­i­cal anger at home to­ward the Chi­nese in­vest­ment,” Pan­tucci said. “If you got huge pub­lic anger to con­front, you’ve got to re­spond to it.”

In Al­maty, the for­mer cap­i­tal of Kaza­khstan, 378km from China’s western bor­der, Chi­nese mi­grants say dis­crim­i­na­tion by of­fi­cials and po­lice has made it hard for them to plant roots that will en­able Chi­nese de­vel­op­ment to flow out­wards.

A Chi­nese trader who hawks clothes, toys and rice cook­ers at the out­door Barakholka mar­ket, on the out­skirts of the city, says con­di­tions are worse now than when he ar­rived in 1992, soon after Kaza­khstan be­came in­de­pen­dent. Stand­ing out­side an almost empty down­town branch of In­dus­trial and Com­mer­cial Bank of China, the man, sur­named Li, re­calls days when he had to stand in line.

Many left

“Chi­nese peo­ple were queue­ing up to wire money back home then; now many of them have fled in frus­tra­tion, be­cause they found lit­tle go­ing for them here,” said Li, who says he has not been able to ob­tain per­ma­nent res­i­dency. He asked not to be iden­ti­fied in full for fear of reprisals.

China’s ef­forts at soft power have yet to get trac­tion in the coun­try. The Con­fu­cius In­sti­tute, which pro­motes Chi­nese lan­guage and cul­ture through­out the world, has two bases in Kaza­khstan.

The Al­maty branch shares a build­ing with the In­ter­na­tional Re­la­tions Depart­ment of AlFarabi Kazakh Na­tional Univer­sity. Even so, most stu­dents don’t know where it is or what it is for, ac­cord­ing to in­ter­views. At the As­tana branch, a Bloomberg re­porter seek­ing in­for­ma­tion was turned away.

Even for young Kaza­khs who are ea­ger to study Chi­nese to be­come more com­pet­i­tive in the job mar­ket, China feels very re­mote. Ma­lika Ke­les­bekova, a 20-year-old me­te­o­ro­log­i­cal stu­dent at Al-Farabi, said her par­ents ad­vised her not to mix closely with Chi­nese peo­ple.

“China we don’t un­der­stand – its peo­ple, its cul­ture and its men­tal­ity,” Ke­les­bekova said. “It’s a mys­tery for us.”

An­a­lysts say China doesn’t get Cen­tral Asia ei­ther, mak­ing its vi­sion flawed by fail­ing to con­sult its pro­posed part­ners. Of­fi­cials in coun­tries such as In­dia say there haven’t been any talks with China about its Silk Road pro­posal. – Bloomberg


Kaza­khstan’s peo­ple want to ben­e­fit eco­nom­i­cally from what China has to of­fer, but are wary of ‘be­ing over­whelmed’. China sur­passed Rus­sia as Kaza­khstan’s top trad­ing part­ner in 2010.


Chi­nese Pres­i­dent Xi Jin­ping

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