Chinese Spending Lures Countries to Its Belt and Road Initiative

By Bloomberg News

Chinese President Xi Jinping’s plan to revive an ancient trade route connecting the Middle Kingdom, Central Asia and Europe has morphed into a sweeping campaign to boost global trade and economic growth. While globalization is losing public support in the U.S. and Europe, Xi’s“Belt and Road Initiative” (BRI) has met with increasing acceptance from both developing and developed countries hoping to cash in on Chinese largesse.

China’s Belt and Road Initiative

Silk Road Economic Belt

Maritime Silk Road Initiative

Moscow

Duisburg

Rotterdam

Almaty

Urumqi

Bishkek

Venice

Istanbul

Samarkand

Dushanbe

Xi'an

Tehran

Athens

Gwadar

Guangzhou

Fuzhou

Kolkata

Hanoi

Colombo

Kuala Lumpur

Singapore

Nairobi

Jakarta

Silk Road Economic Belt

Maritime Silk Road Initiative

Moscow

Duisburg

Xi'an

Fuzhou

Gwadar

Kolkata

Nairobi

Jakarta

Silk Road

Economic Belt

Maritime Silk

Road Initiative

Hundreds of leaders and dignitaries from 110 participant countries will gather at a summit in Beijing this month to discuss the grand plan. Countries along the routes account for 16 percent of the global economy today and about a fifth of global trade. But with about 43 percent of the world’s population, China is betting that’s set to increase.

Indeed, China’s outreach seems to have no geographic limits, with New Zealand and South Africa among those to sign a memorandum of understanding (MOU) with China to jump on the “Belt and Road” bandwagon.

The Increasing Outreach of the Middle Kingdom

Signed Memorandum of Understanding with China

Major countries along the Belt and Road Initiative

Signed MOU with China

Europe

Armenia

Azerbaijan

Belarus

Bulgaria

Czech Republic

Georgia

Hungary

Macedonia

Moldova

Poland

Romania

Russia

Serbia

Slovakia

Turkey

Ukraine

Asia-Pacific

Bangladesh

Cambodia

Laos

Malaysia

Mongolia

Nepal

New Zealand

South Korea

 

 

Middle East

Iran

Iraq

Kuwait

Qatar

Saudi Arabia

 

Central Asia

Kazakhstan

Kyrgyzstan

Tajikistan

Uzbekistan

South Asia

India

Maldives

Pakistan

Sri Lanka

 

Africa

South Africa

Major countries along the Belt and Road Initiative

Signed Memorandum of Understanding with China

Signed MOU with China

Europe: Armenia, Azerbaijan, Belarus, Bulgaria, Czech, Georgia, Hungary,

Macedonia, Moldova, Poland, Romania, Russia, Serbia, Slovakia, Turkey, Ukraine

◼ Asia-Pacific: Bangladesh, Cambodia, Laos, Malaysia, Mongolia, Nepal,

New Zealand, South Korea ◼ Middle East: Iran, Iraq, Kuwait, Qatar, Saudi Arabia

◼ Central Asia: Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan

◼ South Asia: India, Maldives, Pakistan, Sri Lanka ◼ Africa: South Africa

Major countries along the Belt and

Road Initiative

Signed Memorandum of Understanding

with China

Signed MOU with China

Europe: Armenia, Azerbaijan, Belarus,

Bulgaria, Czech, Georgia, Hungary,

Macedonia, Moldova, Poland, Romania,

Russia, Serbia, Slovakia, Turkey, Ukraine

◼ Asia-Pacific: Bangladesh, Cambodia,

Laos, Malaysia, Mongolia, Nepal,

New Zealand, South Korea

◼ Middle East: Iran, Iraq, Kuwait, Qatar,

Saudi Arabia ◼ Central Asia: Kazakhstan,

Kyrgyzstan, Tajikistan, Uzbekistan

◼ South Asia: India, Maldives, Pakistan,

Sri Lanka ◼ Africa: South Africa

From Bangladesh to Belarus, railways, refineries, bridges, industrial parks and much else is being built. In Colombo, a new city larger than Monaco is taking shape near Sri Lanka’s main port. With an estimated total investment of $13 billion spanning about 25 years, the new city is shaping up as the poster child for the China’s grand plan.

A freight route linking China’s eastern coast and London has already started operating. Stretching over 12,000 kilometers and passing through nine countries, the railway allows cargo to travel across the Eurasia continent in 18 days.

China’s Power Expands as Projects Take Shape

China-Myanmar

Crude Pipeline

China-Pakistan

Economic Corridor

Bangladesh

Padma Bridge

and Railway

Islamabad

Kunming

China-Laos

Railway

Railway

Made

Island

Terminal

Vientiane

Sri Lanka

Colombo

Port City

Road

Gwadar

Karachi

The China-Laos railway is the first foreign connection to China. The Myanmar pipeline lets oil imports skirt the Strait of Malacca and South China Sea.

The projects will help China gain a solid footing in one of the major ports along the world’s busiest maritime routes.

 

 

 

The initiative’s land and sea routes converge in Pakistan, which China calls its “all-weather strategic partner.”

 

 

Cairo

China-Egypt

Suez Canal

Economic Corridor

Moscow

London

China-Belarus

Industrial Park

China-Europe

Freight Train

Riyadh

Yiwu

Minsk

Yanbu Aramco

Sinopec Refinery

in Saudi Arabia

China is the largest investor in the Suez Canal Corridor. Saudi Arabia is China’s largest oil supplier.

 

As China’s largest industrial park

overseas, it will be a bridgehead for Chinese companies to enter the

Central Asia and Europe markets.

 

The railway links China with London via nine countries. Cargo trains can cross the Eurasian continent in 18 days.

 

China-Myanmar

Crude Pipeline

Bangladesh

Padma Bridge

and Railway

Kunming

China-Laos

Railway

Made

Island

Terminal

Vientiane

Sri Lanka

Colombo

Port City

The China-Laos railway is the first foreign connection to China. The Myanmar pipeline lets oil imports skirt the Strait of Malacca and South China Sea.

The projects will help China gain a solid footing in one of the major ports along the world’s busiest maritime routes.

 

 

 

China-Pakistan

Economic Corridor

Cairo

China-Egypt

Suez Canal

Economic Corridor

Islamabad

Riyadh

Railway

Yanbu Aramco

Sinopec Refinery

in Saudi Arabia

Road

Gwadar

Karachi

The initiative’s land and sea routes converge in Pakistan, which China calls its “all-weather strategic partner.”

 

 

China is the largest investor in the Suez Canal Corridor. Saudi Arabia is China’s largest oil supplier.

 

Moscow

London

China-Belarus

Industrial Park

China-Europe

Freight Train

Yiwu

Minsk

As China’s largest industrial park

overseas, it will be a bridgehead for Chinese companies to enter the

Central Asia and Europe markets.

 

The railway links China with London via nine countries. Cargo trains can cross the Eurasian continent in 18 days.

 

China-Myanmar

Crude Pipeline

Kunming

China-Laos

Railway

Made

Island

Terminal

Vientiane

The China-Laos railway is the first foreign connection to China. The Myanmar pipeline lets oil imports skirt the Strait of Malacca and South China Sea.

Bangladesh

Padma Bridge

and Railway

Sri Lanka

Colombo

Port City

The projects will help China gain a solid footing in one of the major ports along the world’s busiest maritime routes.

 

 

 

China-Pakistan

Economic Corridor

Islamabad

Railway

Road

Gwadar

Karachi

The initiative’s land and sea routes converge in Pakistan, which China calls its “all-weather strategic partner.”

 

 

Cairo

China-Egypt

Suez Canal

Economic Corridor

Riyadh

Yanbu Aramco

Sinopec Refinery

in Saudi Arabia

China is the largest investor in the Suez Canal Corridor. Saudi Arabia is China’s largest oil supplier.

 

China-Belarus

Industrial Park

Minsk

As China’s largest industrial park

overseas, it will be a bridgehead for Chinese companies to enter the

Central Asia and Europe markets.

 

Moscow

London

China-Europe

Freight Train

Yiwu

The railway links China with London via nine countries. Cargo trains can cross the Eurasian continent in 18 days.

 

But it’s not going to be all good news, if history is any guide. From Africa to Latin America, China has a checkered history when it comes to its foreign investments. In Venezuela, a high-speed railway project was abandoned. The Latin American country, also one of the largest recipients of Chinese lending, defaulted last year on a payment of principal in an oil-for-loan program due to a mounting economic crisis at home.

Even in Myanmar, where demand for Chinese money to develop infrastructure is huge, a $3.6 billion dam project was halted after local protests over environment concerns.

China’s Large Foreign Investments

Failed projects

Ongoing projects

$5B

China-Belarus

Industrial

Park

$54B

China-Pakistan

Economic

Corridor

$3.1B

Bangladesh

Bridge

and Railway

$7.5B

Venezuela

High-Speed

Railway

$24.5B

China-Myanmar

Crude Pipeline

$0.2B

China-Egypt

Suez Canal

Economic

Zone

$5.8B

China-Laos

Railway

$3.6B

Myanmar

Myitsone

Dam

$1B

Palm Oil

Plantation in

DR Congo

$10B

Saudi Arabia

Refinery

$20B-$24B

Venezuela

Oil-for-Loan

Program

$0.5B

Brazil

Soybean

Processing Base

$13B

Sri Lanka-

Colombo

Port City

$1.5B

Lake Victoria

Free Trade Zone

in Uganda

Ongoing projects

$54B

China-Pakistan

Economic Corridor

$24.5B

China-Myanmar

Crude Pipeline

$13B

Sri Lanka-

Colombo

Port City

$10B

Refinery

in Saudi

Arabia

$5B

China-Belarus

Industrial Park

$3.1B

Bangladesh

Bridge and

Railway

$0.2B

China-Egypt

Suez Canal

Economic Zone

$5.8B

China-Laos

Railway

Failed projects

$20B-

$24B

Venezuela

Oil-for-Loan

Program

$7.5B

Venezuela

High-Speed

Railway

$3.6B

Myanmar

Myitsone

Dam

$1.5B

Lake

Victoria

Free

Trade

Zone in

Uganda

$1B

Palm Oil

Plantation

in DR Congo

$0.5B

Brazil

Soybean

Processing

Base

Ongoing projects

$54B

China-Pakistan

Economic Corridor

$24.5B

China-Myanmar

Crude Pipeline

$13B

Sri Lanka-

Colombo

Port City

$10B

Refinery

in Saudi

Arabia

$5.8B

China-Laos

Railway

$5B

China-Belarus

Industrial Park

$3.1B

Bangladesh

Bridge and

Railway

$0.2B

China-Egypt

Suez Canal

Economic Zone

Failed projects

$20B-

$24B

Venezuela

Oil-for-Loan

Program

$7.5B

Venezuela

High-Speed

Railway

$3.6B

Myanmar

Myitsone

Dam

$1.5B

Lake Victoria

Free Trade

Zone in

Uganda

$1B

Palm Oil

Plantation

in DR Congo

$0.5B

Brazil

Soybean

Processing

Base

Doubters claim the “Belt and Road Initiative” is all about China exporting its industrial overcapacity and seeking to generate new contracts for its bloated state-owned industries or worse, forcing more and more neighbors into its strategic orbit. Optimists see Chinese investment unlocking economic growth across a vast region with a young population. For Xi, this month’s summit is a chance to persuade a skeptical world that globalization indeed does have a new champion.