The One Belt One Road (OBOR) project, which seeks to connect more than 60 countries in Europe and Asia through new land and sea links that begin in China, is expected to play a large role in driving economic growth across Europe and Asia.
China is attempting to tackle multiple strategic goals with OBOR. As well as focusing on trade, development and finance, it is also seeking to expand its diplomatic and security influence to create a new financial system that is comfortable with China, explained David Arase, resident professor of international politics at the Hopkins-Nanjing Centre, Nanjing University.
“One Belt, One Road has been a great benefit for Chinese diplomacy and for China’s desire to achieve its so called great rejuvenation of the Chinese nation,” said Arase. “One example you can see in Europe is the 16+ 1 forum which brings together China and the 16 countries of central and eastern Europe together for an annual meeting.
“China is able to use One Belt One Road to convene these European countries to orientate their development, trade and financial policies to China’s interests and needs.”
However, there are already some signs that China needs to work to convince governments and their citizens that the policies will not benefit China at the expense of domestic nations.
“Definitely there is a strong case for creating better infrastructure in the region,” said MM Pallam Raju, former minister of defence for India.
“The world has observed that China’s economic help is important to the world economy too, and if this initiative of One Belt One Road is from an economic perspective, India definitely welcomes it, but at the same time we have certain concerns in some of the proposed areas of the project.
“[It’s worth] noting globally that China is not necessarily viewed as a benign power so China has to be more transparent, especially when it comes to sharing specifics on the project.”
KAZAKHSTAN PROTESTS
The recent protests in Kazakhstan against land reforms, which are due to come into force on July 1, were given an example. Under the changes to the Land Code, foreigners would be allowed to rent agricultural land for 25 years. In recent days protesters have taken to the street and news reports claim that one of their main concerns is that Chinese investors will be big buyers of the land.
“Kazakhstan very warmly welcomes and supports the Belt and Road initiative because we are a land locked country and this initiative helps us to eliminate this disadvantage,” said Olzhas Khudaibergenov, the director of Centre for Macroeconomic Research in Kazakhstan. “Kazakhstan also has a relationship with China in the cultural sphere but when we talk about the land we have fears that this use of land can be used in a bad way for Kazakhstan.
“If China were to buy one or two million hectares in Kazakstan it could bring its own labour force and there would be many bad consequences.”
Despite the concerns, there was recognition that the success of One Belt, One Road would create opportunities around the region and beyond.
Speaking about Japan’s decision to not yet join the Asian Infrastructure Investment Bank, Koji Sakuma, general manager and chief economist at Japan’s Institute for International Monetary Affairs, said the country could still benefit even though it is not a member.
“Economics is not a zero sum game so if China gains solid growth because of the successful development of One Belt, One Road, even if Japanese corporates don’t have a direct benefit, sold growth of China is an indispensable factor in Japan’s recovery.”