China’s OBOR initiative boon for economies
THE Belt and Road Initiative currently being spearheaded by China presents an opportunity to connect infrastructure, cultural and technological exchange, which can drive economies, key Asian officials have said.
China is pursuing a two tier economic policy dubbed “One Road, One Belt”. “One Belt” refers to the economic belt, while the “One Road” refers to a modern day maritime road, both referencing a development strategy emphasising cooperation between China and the world. There is an economic and a logistical distinction. Economically, the One Belt is intended to integrate China with central Asia, Middle East, and Europe while the One Road seeks to create an avenue of trade and shipment. Notably, both tiers of the policy merely include a trim of Africa, only a maritime coast line from the Mediterranean to Kenyan port of Lamu.
From recent Chinese investment patterns, most interaction with the western coast such as Angola and Nigeria, has been in terms of sourcing or enabling supplies such as fishery and oil. Interaction with the eastern trim, such as Kenya and Ethiopia, has been more in infrastructure such as roads, rail, air and sea ports that capacitates the One Road logistical leg.
The initiative ties in well with Zimbabwe’s thrust to pursue infrastructure development and already President Mnangagwa has said there has been more interest from Chinese investors in infrastructure projects.
Contributing to a Caixin debate session at the ongoing World Economic Forum in Davos, Switzerland here, Shahid Khaqan Abbasi, Prime Minister of Pakistan said the “One Road and One Belt” initiative was in sync with the World Economic Forum’s 2008 annual meeting about creating a shared future in a fractured world.
“The Belt and Road Initiative is a physical manifestation of the bond between countries that have existed through history” and can result in “freer movement of people, goods and ideas, and a greater culture of openness.”
A senior official in the office of the Prime Minister of Singapore welcomed the Chinese initiative saying: “We should move beyond the perspective of a zero-sum game,” he stressed, and create more interdependencies.
The World Economic Forum’s 48th Annual Meeting was scheduled to run from 23 to 26 January 2018 in Davos-Klosters, Switzerland. More than 3,000 leaders from around the world are gathered in a collaborative effort to shape the global, regional and industrial agendas, with a commitment to improve the state of the world.
Financial sustainability is key to the long-term success of the initiative, said Jin Liqun, president of the Asian Infrastructure Investment Bank (AIIB), People’s Republic of China, which is instrumental in its funding. “We should never do a project that would be a white elephant,” he warned, such as loss-making showcase projects by politicians built with public money.
“Protectionism is a reality you have to live with,” he added. “But when we promote connectivity and infrastructure projects which can bring people together with shared benefits, I think there will be less market for protectionism.”
Although the initiative is spearheaded by China, to succeed it must unite multiple stakeholders. “The Belt and Road is more than just an infrastructure project, it is a crucial engine for building a more socially inclusive tomorrow,” said Ren Hongbin, Chairman, China National Machinery Industry Corporation (Sinomach), People’s Republic of China. “It belongs to everyone. This will be a tremendous opportunity for China to help to build a better system that allows the world to participate in the next phase of growth for the world economy.”