Silk Road Headlines_31st January, 2020

BRI confusion reigns across Eurasia. The magnitude of the Belt and Road Initiative, unclear guidelines and a great diversity of involved actors (both Chinese and non-Chinese), make it difficult for the Chinese government to control the narrative and harm its reputation. While reforms in the financial system and state-owned enterprise efficiency are seen by many European China experts and practitioners as critical tasks [MERICS China Forecast 2020], it is unclear how much priority China gives to reforming the BRI. That being said, the Chinese government has introduced damage control mechanisms such as publishing a blacklist that identifies organizations that refer to themselves as part of BRI but whose activities China views as damaging to the reputation of BRI [Branding the Belt and Road: Beijing embarks on damage control in Central Asia]. Still, such efforts to retain control of BRI probably will do little for the overall reception of the initiative as more structural problems remain, such as a lack of transparency or mechanisms to deal with corruption in relation to BRI projects. 

For China engaging with high-risk and developing economies has its benefits, as this potentially enhances the country’s profile as a leader in global development. But with such countries facing challenges like having an underdeveloped infrastructure, limited access to global markets and the burden of previous loans to multilateral institutions, there are limitations to what even a financially capable actor as China can contribute to their economic development. Still, according to the Chinese government, BRI is capable of providing a significant contribution to economic development through improved connectivity. This in turn would lead to greater stability and security. Afghanistan represents a test case for this argument. As Barbara Kelemen writes, in Afghanistan the domestic and regional security issues that BRI is supposed to help solve are themselves major obstacles to its implementation [China’s Economic Stabilization Efforts in Afghanistan: A New Party to the Table?]. 

Apart from these long-term structural problems, China is also facing new developments. Countries once fully on board with Beijing’s approach are now starting to renegotiate what in essence are beneficial deals for Beijing. Angola is aiming to end the use of oil as a guarantee for the bilateral debt accumulated with China [Angola negotiates the end of oil-backed debt with China]. Political moves have also tainted bilateral relations, the most recent example coming from the Czech Republic. Shanghai ended its sister-city deal with Prague, after the latter began a sister-city agreement with Taipei [Time for the EU to offer CEE an alternative to China]. In recent years both the Czech Republic and Angola enjoyed very warm relations with China. Hence, the renegotiation of deals points to a question that is relevant for the BRI’s success: how sustainable and susceptible to change is the Chinese commitment to other countries? 

By Clingendael