On the 10^th anniversary of the BRI, we look at 10 key figures that demonstrate the scale and ambition of the project.

155
As of August 2023, a purported 155 countries have joined the BRI by signing a memorandum of understanding (MoU). According to the Chinese government’s Belt and Road Portal, this includes 40 countries in Asia, 52 countries in Africa, 27 in Europe, 15 in North America, 9 in South America, and 12 in Oceania.

1
Italy is the only G7 country to have joined the BRI, having signed an MoU with Beijing in March 2019. However, as of late 2023, the Italian government has indicated that it is likely to withdraw from the BRI, bringing it into step with the China policy of the rest of the EU. Italian politicians are reported to have been disappointed with the scale of trade and other business dealings with China since the MoU was signed.

$1 trillion
The amount estimated to have been spent on BRI initiatives, making the BRI the largest multilateral development project ever undertaken by a single country.

3,000
The number of major projects estimated to have been undertaken as part of the BRI. This includes roads, railways, ports, power plants and other critical infrastructure.

40%
The proportion of projects in the China-Pakistan Economic Corridor – one of the BRI’s flagship arrangements – estimated to have run into problems such as funding cuts, corruption, or insurmountable cost increases. Some have criticised BRI projects for a lack of follow-through, leaving countries with infrastructure projects and economic zones that ultimately do not contribute to the economy. A report by AidData at William & Mary suggests that around a third of the BRI infrastructure project portfolio has encountered major impediments.

120km per hour
The speed of the trains on the China-Europe Railway Express project, a logistics distribution network that connects China with more than 200 cities in 25 European countries via the Eurasian hinterland.

36 gigawatts
The estimated capacity of the coal power plant projects that have been cancelled since 2021 after Xi Jinping announced that China would no longer support the construction of coal-fired power plants abroad. Since then, China has stated its commitment to supporting green and low-carbon energy development in BRI countries.

13,000km
The length of the Yiwu-Madrid railway line, the world’s longest railway freight route (the Yiwu-London route is the second longest). The route is one of several used by long-distance trains as part of the “New Eurasian Land Bridge”, which is integrated with the BRI.  The journey takes around three weeks, as opposed to six by sea. Despite the success of China-Europe rail projects over the past decade, most analysts agree that the maritime routes of the BRI still receive the most focus/trade.

99 years
The length of time that the Hambantota International Port in Sri Lanka has been leased to China. China Merchants Port took a 70% stake in the port in 2017 after the Sri Lankan government struggled with debt repayments (the construction of the port had been financed with commercial loans from the Exim Bank of China). Hambantota has been used as an example in accusations that China is practising ‘debt-trap diplomacy’, in which a country extends debt to another country to increase political leverage. However, the ‘debt-trap diplomacy’ hypothesis about the BRI has not been universally accepted by economists and IR specialists.

10,000
The number of scientists from BRI countries that have visited China for research or exchanges. Over the past few years, cultural, digital, and health-related initiatives have been playing an increasingly important role in the BRI, with the focus shifting to “softer” power initiatives, including personal training and the construction of cultural institutions.

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Developing countries have a “huge interest” in Chinese companies and institutions helping with their green energy development, experts have told China Dialogue. But there has yet to be a surge of renewable energy projects finalised under the Belt and Road Initiative (BRI), China’s global infrastructure programme, they said.

Experts spoke to China Dialogue two years after President Xi Jinping promised a shift towards greener overseas energy investments, and ahead of the BRI’s 10th anniversary this autumn.

The slow progress for renewable projects could be down to a range of factors, they explained, such as the long time it takes for deals to be negotiated, expectations realigned and strategies updated, within both China and BRI member countries.

Nevertheless, a few high-profile clean energy projects have been announced this year. They include a 123-megawatt (MW) solar farm in South Africa, to be constructed by Power China; a 50 MW wind farm in Namibia, that has received investment from a consortium led by Energy China; and a 600 MW solar farm in Saudi Arabia, being built by Energy China.

New coal-fired power projects have largely been halted, but a few projects slipped through the net because of “loopholes”, the experts added.

Ditching coal (almost)

At a UN meeting in September 2021, Xi announced that “China will step up support for other developing countries in developing green and low-carbon energy, and will not build new coal-fired power plants abroad”.

Since then, no new investments in coal power plants have been recorded under the BRI, according to the China Overseas Finance Inventory, which tracks Chinese equity and debt investments in the power generation sector. The database is a collaborative effort between five US universities and institutes, and contains transaction details of 652 investments in 569 power plants across 87 BRI countries.

“There is huge interest in having Chinese manufacturers, developers and state-owned enterprises going out and supporting the green energy transition. This is a change,” Christoph Nedopil, an expert in green finance and the BRI, told China Dialogue.

The interest mostly comes from host countries and partly from Chinese companies wanting to be closer to their customers and avoid potential trade restrictions, among other reasons, Nedopil said.

“Most Chinese state-owned companies and banks I know are not interested in coal projects anymore,” he added. “This was not true in 2020, when there was still a lot of talk about the need for coal.”

The shift in mindset can also be found in a lot of host countries, he noted. “The understanding is that coal is less relevant.”

Nedopil is director of the Griffith Asia Institute in Australia. When China Dialogue spoke with him, he was director of the Green Finance and Development Centre (GDFC) at Fanhai International School of Finance, part of Fudan University, in Shanghai. At the GFDC, he published a series of reports analysing BRI investments.

The GFDC’s latest assessment found that China’s energy-related “engagement” – meaning construction and investment – under the BRI in the first half of 2023 was the “greenest” for any six-month period since the initiative’s launch in 2013.

The report looked at the share of renewable projects in all-energy engagement, which includes power generation and exploration of resources related to energy. It found that nearly 56% of the US$12.3 billion that China spent on energy projects during the period went into renewable sources, with 41% going into solar and wind, and 14% into hydropower.

However, some experts emphasised that not all new coal power projects have been scrapped. While Xi’s announcement was “certainly a step in the right direction”, a few projects are still moving ahead, such as a 300 MW coal power plant in Pakistan and a 1.5-gigawatt (GW) plant in Indonesia, Blake Berger, associate director at the Asia Society Policy Institute in New York, told China Dialogue.

“This is where the loopholes begin to come into play,” Berger noted. The plant on Obi, an island in eastern Indonesia, dodged the axe because it was designed as an internal facility of an industrial park instead of a standalone coal power project. On the other hand, the project in Gwadar, in southwestern Pakistan, is not considered “new” by Chinese and Pakistani officials as it was first proposed in 2016 but repeatedly delayed.

Long renegotiation processes

Although many coal power projects have been called off, there has not been a wave of renewable projects coming in to fill the space, some experts noted.

“There have been no major changes,” said Wang Xiaojun, founder of People of Asia for Climate Solutions, a Manila-based non-profit organisation. This was the case “no matter [whether] we count the number of renewable energy projects that has been signed, or China’s total overseas investments on renewable energy projects – or even the types of new renewable energy projects that were built by host countries.”

Although many thermal power projects have been halted, they have not been transformed into renewable energy projects — Wang Xiaojun, founder of People of Asia for Climate Solutions

One possible cause for the “vacuum” – as Xiaojun put it – is the fact that Xi’s one-line pledge did not specify how coal power projects in the pipeline should be dealt with.

The issue, which remains to be explained clearly, has likely caused the Chinese government and host countries to spend a long time renegotiating those projects, Wang said. “Many previously committed coal projects might be under renegotiation to be converted into renewable energy projects,” he explained.

Other experts point out that it takes time for a government mandate to show impact on the ground. Oyintarelado Moses, data analyst for the Global China Initiative at the Boston University Global Development Policy (GDP) Centre, cited the BRI itself as an example. After the initiative was introduced in 2013, it took about three years for large volumes of financing to arrive, she told China Dialogue.

The GDP Centre runs a database that mostly follows the financing from China’s development finance institutions, such as the Export-Import Bank of China and the China Development Bank. The database did not record any energy projects finalised after Xi’s announcement in September 2021.

“I think we are still in that initial time lag period of [Xi’s] announcement. I do expect there to be more low-carbon and renewable energy projects from 2023,” she added.

Host countries also need time to realign their national energy strategies and make decisions on old and new projects, according to Shen Wei, director of the Green BRI Centre of the International Institute of Green Finance at the Central University of Finance and Economics in Beijing.

“A country’s energy strategy is often the result of long-[term] research and preparation by relevant government departments,” Shen told China Dialogue.

“Even though a country’s government halts its plan for an old coal power plant, researching and formulating a new plan is a very complex process and involves a lot of practical questions.” Should the project be in renewable energy, questions might include the type, location, and capacity, Shen said.

Other challenges include the lack of “supportive infrastructure” in some countries, particularly reliable power grids that can take in renewable power – which can be unpredictable and unstable – while still running safely, according to Shen.

The push for ‘small but beautiful’ projects

Renewable energy projects are often much smaller in scale than coal power plants. This means that Chinese energy investors, banks and developers need to apply new business logic and approaches to them.

Chinese state-owned banks are “having to learn how to structure new deals that are focused on renewable energy projects”, said Moses.

China has prompted state-owned enterprises, particularly those directly run by the central government, to adjust their strategies. In February, Zhao Shitang, deputy director of the State-owned Assets Supervision and Administration Commission of the State Council, instructed central-level state-owned enterprises to “incubate a batch of small but beautiful projects with good economic and social benefits” under the BRI, with a focus on areas such as green, health and digital.

That was the first time the phrase “small but beautiful” had appeared in the narrative of the BRI, according to Xiaojun, who described the instruction as “a very good change”.

“‘Small but beautiful’ renewable energy projects, such as distributed, flexible and off-grid projects, can meet the energy demands of host countries and provide a huge stage for Chinese private companies,” Xiaojun commented. “This should be the future direction of energy investments for China under the BRI.”

He called for more government backing for Chinese private companies to help them “play to their full strength … Whether it is policy or financial support, I hope the government can enable private companies to invest in energy projects faster and more flexibly overseas.”

Turning to renewable projects also brings the Chinese into a more competitive investment space, said Nedopil. Previously, China, Japan and Korea were more or less the only providers of technology and public financing for overseas coal power plants.

“If you work on renewable energy, there are a lot more potential investors and technology providers, not only from China, but other countries as well,” he said.

‘Traffic light system’

Several Chinese and international organisations have published useful tools for evaluating the environmental impacts of BRI projects and guiding Chinese companies to invest in more sustainable ways.

One of them is the Green Development Guidance for BRI projects, a collaborative research effort launched in 2019, two years before Xi’s announcement on ending support for new coal overseas.

The series of studies is being led by the Belt and Road Initiative International Green Development Coalition, which was initiated by the Ministry of Ecology and Environment and comprises more than 40 companies, associations, thinktanks and non-governmental organisations from China and around the world.

The guidance is also known as the “traffic light system” because it assesses BRI projects using colour-coded labels based on their impacts on climate, ecology and the environment. Green stands for projects that should be encouraged, yellow indicates neutral ones, and red for those that require stricter supervision and regulation.

The first phase of this effort, which was published in December 2020, red-flagged coal-fired power projects, explained Wang Ye, an associate of the Finance Centre and China Sustainable Investment Program at the World Resources Institute (WRI) China, which co-leads the project. This red flagging supported policy guidance “towards transformative development in China’s overseas energy investments on stopping building [of] new coal power plants overseas,” said Ye.

In the third report of the project, published in May, researchers analysed the role of foreign investment cooperation funds in greening the BRI. These are official funds established by China to meet the financing needs for sustainable development in developing countries. Examples include the China-ASEAN Investment Cooperation Fund, China-Africa Development Fund, and China-Latin America and the Caribbean Cooperation Fund.

“All three funds primarily invest in energy, infrastructure construction and manufacturing capacity, sectors [that are] key to the green transition,” noted Ye.

She underscored the importance of such funds: “How they evaluate projects and manage clients are crucial for aligning investment decisions with local needs, concretising their commitment to sustainability, and shifting financing to green projects.”

Asia Society, a non-profit organisation with offices in the US, Asia, Oceania and Europe, has developed a digital “toolkit” to help local communities and companies involved in the BRI ensure that their projects are “mutually beneficial, equitable, inclusive, and environmentally and socially sustainable”.

Available in five languages – English, Mandarin, Khmer, Lao and Bahasa Indonesia – the toolkit focuses on two “critical aspects”: how to undertake environmental and social impact assessments, and how to ensure engagement from stakeholders throughout the project.

“We designed the toolkit to empower local communities with information to better safeguard and defend their own interest, and to help companies involved in these projects undertake these critical aspects of due diligence in a more systematic way,” the Asia Society’s Blake Berger said.

“We found that even minor adjustments in how projects are undertaken can have a sizeable impact on long-term sustainability of the project and receptiveness of the local population,” he added.

How to go further

Looking into the near future, experts listed several types of renewable projects they wanted to see more of under the BRI.

“One is the local manufacturing of goods related to energy transition,” said Nedopil. His report found that there were not many engagements in the manufacturing of equipment needed for green energy transition under the BRI. “I do hope to see more of these engagements – for example, the manufacturing of solar panels.”

Nedopil also said he hoped to see China step up its support for BRI countries by improving their power grids and helping their existing coal plants retire early.

Xiaojun underlined the importance of a growth in “capacity building” in BRI countries by Chinese companies, such as facilitating technological transfer and relocating some of their renewable supply chains there.

In his view, these moves “can help Chinese companies mitigate some potential supply chain risks, as well as nurture the host countries’ labour market and create electricity demand”.

Training local talent is even more important, he pointed out.

“For the construction of BRI power projects, Chinese companies usually bring their own workers, including technicians, from home.” But moving forward, Chinese companies can train workforces locally, while Chinese universities can also offer electricity and renewable courses for young people from BRI countries, Xiaojun said.

“These practices can truly transform a country: to stop it being a climate victim and help it become a climate victor,” he concluded.

This article was originally published on China Dialogue under the Creative Commons BY NC ND licence.

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At the summit in Germany in late June, the heads of government of G7 countries announced the launch of a USD600 billion infrastructure programme – now called the Partnership for Global Infrastructure (PGII) – to boost investment in developing countries. Although this is undoubtedly a positive signal, its framing as a ‘competing offer’ to China’s Belt and Road Initiative (BRI) highlights the misunderstanding which – nearly a decade after its inception in 2013 – still plagues Western governments’ thinking about China’s engagement with third countries. 

According to the White House communique, PGII aims to mobilise USD600 billion in infrastructure investment from G7 countries by 2027, including USD200 billion from the United States alone. The programme wants to “deliver quality, sustainable infrastructure that makes a difference in people’s lives around the world, strengthens and diversifies our supply chains, creates new opportunities for American workers and businesses, and advances our national security.” 

Beijing’s reaction was rather positive. As Zhao Lijian, the spokesperson of the Chinese Ministry of Foreign Affairs, noted at a press conference, “China always welcomes initiatives that promote global infrastructure.” Zhao, of course, pointed out that PGII and BRI can be complementary and should not exclude each other based on geopolitical considerations. 

China’s response should come as no surprise to those familiar with BRI projects and developments. What’s more, a proper analysis of the strengths and shortcomings of China’s experience in overseas infrastructure projects is essential if PGII is to become a successful tool to help developing countries and Western businesses operating in them.

Understanding the drivers of BRI 

Ever since Chinese President Xi Jinping presented his idea of the ‘One Road, One Belt’ initiative at a speech in Kazakhstan in 2013, the BRI has captured the imaginations of foreign analysts. While some were fascinated by the idea of a modern ‘Silk Road,’ others saw it as a master plan for Chinese world domination. 

Seasoned China watchers were more cautious, pointing out that the new BRI label (or OBOR as it was first called) was indiscriminately attached to nearly all Chinese outbound investment and aid projects, no matter how far in advance they preceded Xi’s speech. There are, however, several factors which have pushed BRI beyond China’s traditional ‘foreign aid’ policies: 

• Overcapacity: The large stimulus following the financial crisis in 2008 created a massive surplus capacity in infrastructure and related sectors. Outbound investment and foreign construction projects thus offered an outlet for these industries.
• Commodities: China’s economic rise increased the dependency on foreign raw materials, triggering a frenzy of Chinese investments in oil fields and mines around the world.
• Regional Development: One of the major reasons for the ‘ New Silk Road’ plan was to improve the connectivity between China’s poor inland provinces to major export markets in Europe, especially via rail.
• Global ambitions: with growing affluence came growing ambitions. Using outbound investment to shore up support for China’s clout in the UN and other international bodies. 

Given that domestic overcapacity was a key driver of BRI, it is of little surprise that most BRI projects were in these sectors. According to a 2019 report by the data provider Refinitiv, the vast majority of Chinese investment — some USD500 billion — went into transport (road and rail), power plants and real estate, accounting for a staggering 85% of the total. 

But even within these three categories, there are variations. As a report on Chinese overseas port investment by the Grandview Institution – a Chinese think tank – noted, there is a vast gap between China’s port presence in Djibouti – a purely military project – and Chinese investment in ports in Piraeus or Darwin, which are purely commercial. According to Refinitiv data, only 63% of surveyed BRI projects were financed directly by the Chinese government, with 31% managed by private entities and another 5% run by public listed companies.

BRI projects by industry (left); BRI projects by main source of financing (right). Source: Refinitiv

The debt-trap myth 

Despite the large variety of BRI projects, most of the West’s thinking about BRI is still shaped by the perception of Chinese financial aid as some sort of debt trap. The idea goes back to a polemical essay by Indian professor Brahma Chellaney for whom Chinese investment – especially in Sri Lanka – was nothing short of a hideous masterplan for world domination. Despite experts such as Deborah Bräutigam of Johns Hopkins University and Lee Jones and Shahar Hameiri of Chatham House thoroughly debunking the ‘debt trap diplomacy’ myth, it seems that Western politicians were eager to embrace the framing to suit their own political agendas. 

Yet this misunderstanding by Western governments not only ignores the agency of recipient countries, but it also increases the risk for PGII to make the same painful mistakes of some of the more controversial BRI projects. As Jones and Hameiri pointed out in their lengthy report on the initiative, most loans aren’t imposed by Chinese investors on hapless developing countries, but are, instead, defined by these countries themselves.

This is, for example, the case with the controversial Hambantota Port in Sri Lanka, which was an idea of the now ousted Premier Mahinda Rajapaksa. That such a hands-off approach by Chinese investors can lead to massive misallocation and corruption, is something that the Chinese government itself had to find out the hard way. 

However, relying on local authorities to define investment priorities can also be beneficial. As a Carnegie report on BRI investment in Argentina shows, Chinese investment can, indeed, play a crucial role in helping third countries meet their own development goals. 

In deciding on projects, Chinese investors have long sought help from outside consultants and have also teamed up with Western institutions to improve the quality and risk management of BRI activities. For example, China collaborates with the European Bank for Reconstruction and Development (EBRD) to support green development projects in Central Asia. China has also signed so-called third-party market cooperation agreements — including with France, the Netherlands, Belgium, Spain, Austria, Japan, Singapore and Australia — to allow for foreign participation in BRI projects and to ensure that projects meet international standards. 

What can PGII contribute? 

So, given that China is already collaborating with external investors and stakeholders to make BRI projects greener and more sustainable, what exactly can PGII contribute? Pradumna B. Rana of Nanyang University, Singapore, thinks that Western infrastructure programmes can help in three particular areas:

• ‘Soft’ vs ‘hard’ infrastructure: with Chinese investment often focusing on bricks-and-mortar infrastructure projects, Western investors could concentrate more on ‘soft’ infrastructure, such as education, healthcare and gender equality projects.
• Private capital: attracting private capital has been notoriously difficult for BRI investments. PGII could alleviate this shortcoming and help ‘crowd in’ funds from private businesses
• Resource additionality: According to UN estimates, countries would have to invest USD2.6 trillion (£2.3 trillion) annually until 2030 to meet the United Nations’ Sustainable Development Goals. So, additional investment from developed countries could complement, rather replace Chinese funding.

BRI, PGII and the Global Infrastructure Gap (BRI value as of 2021, PGII value as stated by the US government)
Source: White House; World Bank

Japan’s own attempt at setting up a BRI alternative – the Quality Infrastructure Investment (QII) initiative – offers another important lesson on how PGII and BRI could create synergy rather than geopolitical friction. Initially set up within Japan’s strategic framework of the Free and Open IndoPacific (FIOP) and to promote sustainable and high-quality infrastructure investment, Japanese investors ended up cooperating rather than competing with China’s own BRI projects. As Alisher Umirdinov of Nagoya University points out, the high investment amounts required for large-scale infrastructure projects combined with the risk management imperative of diversifying funding sources made it ultimately more reasonable for both countries to pool resources and know-how rather than launching separate construction projects. 

The CBBC View

It seems that the current framing of the G7’s Partnership for Global Infrastructure (PGII) might be based on a misunderstanding of China’s BRI and ignores the participation of many Western (and Japanese) development agencies in its projects. 

What’s more, a PGII driven by geopolitical rather than practical considerations would expose investment decisions to the same risks as some of the more controversial BRI projects (e.g. those in Sri Lanka and Venezuela), namely the funding of economically unviable projects supported by ‘friendly’ but politically unstable governments.

Instead, the convergence of due diligence requirements for Chinese and Western investors increases the likelihood that PGII might follow the tracks of Japan’s own BRI competitor, QII. This would mean an increase in collaboration, more diverse funding, and higher standards for international infrastructure projects – a result that’s not only more optimistic but also more realistic.

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A global contest is brewing. China, the US, and the EU are all vying for influence along routes that Beijing first turned its attention to in 2013 when President Xi announced his Belt and Road Initiative (BRI), that would bring the ancient Silk Road into the present day. It hasn’t always been this way. In the years preceding the outbreak of Covid-19, cooperation was the name of the game when it came to the BRI. In 2019, while attending the BRI Forum in Beijing, Britain’s then Chancellor of the Exchequer, Phillip Hammond, came close to signing a Memorandum of Understanding that would have given Beijing Britain’s backing. Fast forward to the present day, and the US is spearheading the creation of the Build Back Better World (B3W) initiative within the G7, while the EU has unveiled plans to launch a “Global Gateway” scheme.

So how does Britain fit in? And why is a country that once called the BRI “an extraordinarily ambitious vision” now debating whether it would be better throwing its lot in with Brussels and Washington?

Background

The BRI, also known as One Belt, One Road (OBOR), is one of the main load-bearing pillars of the Xi administration’s foreign policy. A diverse portfolio of overseas investment and construction projects rolled into a new, China-led model for interactions between countries, combined with a channel through which to transfer Chinese overcapacity, the BRI certainly is, as Phillip Hammond once noted, “a project of truly epic ambition.”

Stretching from China into Europe and traversing the continents of Central Asia, Africa, and the Arctic, China uses the investments its state-owned banks and companies makes along the route of the BRI to deepen its access and influence on the world stage, particularly in the Global South. Chinese banks and corporations have made over $2 trillion in foreign direct investments since 2005. The Trump administration worked hard to brand these investments as part of a “predatory lending programme” or a “debt trap,” but this claim has been widely refuted.

The prevailing view among scholars studying the BRI and how it fits into China’s new globalism is that there is no such “debt trap,” nor is China doing anything untoward to exploit the countries once its firms have invested. Research shows that China has never actually seized an asset from any country owing funds and that Chinese banks are willing to restructure the terms of existing loans. As such, the prevailing motivation behind the West’s increasing desire to provide an alternative is to halt the spread of the ‘China option.’

If that is the case, then the clock is ticking, and China has a clear first-mover advantage. Chinese companies have become more professional in their dealings overseas. Meanwhile, the governments of the countries within which Chinese entities focus their investments seem to find the alternative financial and legal institutions that are being set up in parallel to the Bretton Woods system, to handle BRI disputes, to be very appealing. Distinguishable by their informality, ad hoc design, and preference for soft law over systematic formal rules, whether China plans to align its terms and conditions with international (read: Americanised) best practices remains unclear.

What are the Western alternatives to the BRI?

It might be too little too late to halt China’s emergence in the Global South. It could be that there is just too much Chinese capital flowing through these emergent economies already, rendering the West’s efforts to dissuade BRI countries from subscribing to China’s offer of an “Asian model” of economic development a futile endeavour.

That said, the US-led, G7 B3W initiative plans to narrow the “$40 trillion in infrastructure investment that developing countries will need by 2035”; $2 trillion has already been committed by the US, with other G7 members currently considering their contributions. Compared to the infrastructure focus of the BRI, the B3W initiative targets areas such as climate health, digital technology, gender equity, and health security, and is heavily private sector-led.

Brussels, meanwhile, has announced the Global Gateway (GG), a spending plan that will see $300 billion directed at countering China’s economic influence, predominantly across the African continent. Like B3W, GG is private sector-led and the text of the initiative specifies that it is about “rule of law, human rights, and international values.”

Where does the UK fit in?

The UK is a member of the G7, so presumably will transition its tacit support for the BRI to the US-led initiative, B3W. Foreign Secretary Elizabeth Truss has already indicated that she plans to align her department with the initiative’s objectives. What this means for UK-China relations depends on how closely the Johnson cabinet seeks to align its departments with their counterparts in the Biden administration. Were the UK government to pursue a policy of exclusive alignment with B3W, that could create complications with China because the Department for International Trade and the National Development & Reform Commission still have a Memorandum of Understanding in place from the 2019 Economic & Financial Dialogue focussed on third market cooperation (Read: BRI).

While the British government has kept its cards close to its chest concerning B3W – which remains scant on detail – and has not revealed its formal intentions vis-à-vis aligning with America’s vision, the UK and China reportedly plan to hold an economic and financial dialogue (EFD) in 2022, which could put pressure on the Johnson government to choose sides. Given that the UK and China have successfully delivered on almost all the outcomes agreed at the previous meeting, it is hard to see a palatable diplomatic exit ramp – for want of a better expression – for DIT to use should it want to extricate itself from further UK-China collaboration along the BRI. Ms. Truss has been far more hawkish towards China, however, so it will be up to the Prime Minister to bring the Foreign, Commonwealth & Development Office into alignment with DIT on further cooperation with China along the route. DIT, rather than the FCDO, currently coordinates the bulk of UK cooperation with China relating to the BRI.

The CBBC View

The BRI could become awkward for Britain as it tries to juggle asserting itself as a prominent, global trading nation and being a determined defender of multilateralism and the rules-based order. British firms have done well through partnering with Chinese state-owned enterprises along the route, particularly in the built environment and financial and professional services sectors – as a result, the British and Chinese governments have managed to tick off all the policy outcomes relating to the BRI from the last EFD. The BRI differs substantially from the US and Europe’s new offerings; it does not share their values-based approach for a start. Underlying the initiative is the idea that China is just as capable as the US in global leadership and governance – could cooperation along the route become the next area where the UK comes under pressure from the US and China to choose a side?

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The circular included eight pilot tasks and 122 measures to promote innovation in the service industry, and 16 measures to remove bureaucratic hurdles for new market entrants. Most importantly, it also included 26 measures to facilitate the entry of foreign service providers.

The sectors that have been prioritised in this new round of reforms are:

• Transportation
• Tourism
• Education
• Land Planning
• Industrial Design
• Healthcare
• Finance and Insurance
• Business Services

The document singles out four areas in particular: financial and insurance services, RMB internationalisation, Belt-and-Road-Initiative, and Intellectual Property Protection

Financial and Professional Services

The opening up of the financial sector is a major objective of China’s new service sector reforms. In further improving access and cross-border trade in this area, the reform aims to promote cross-border payment solutions, allow the mutual recognition of professional qualifications, improve market access for overseas professionals to the Chinese market, and promote international cooperation.

Initial reform will be rolled out in pilot areas such as the Greater Bay Area and the Yangtze River Delta. Initially, banking and insurance companies from Hong Kong and Macao will be granted priority treatment but other international firms will probably benefit as well.

Finally, the reforms also want to let foreign private equity funds get more opportunities to participate in the funding of new technology companies.

RMB financing

The second area of reform concerns the international use of China’s currency, the Renminbi. The Chinese government wants to reduce the economy’s dependency on the dollar and therefore supports the establishment of a RMB cross-border trade financing and refinancing service system.

The new digital RMB pilot projects will play a crucial role in this reform and the circular designates the Beijing-Tianjin-Hebei region as the pilot area to promote the use of new digital currency and financing, and cross-border payment transactions.

Belt and Road Initiative

Although initially focused on infrastructure projects, China’s ambitious Belt and Road Initiative will now also include projects that deepen the cooperation in the international trade in services.

For that purpose, pilot areas will set up so-called ‘Belt and Road’ legal service centres and commercial arbitration centres, and promote cross-border trade in finance, insurance, intellectual property, e-commerce, and transportation.

Intellectual Property

Intellectual Property protection has long been a top priority for Chinese policy makers, not least to safeguard China’s own increasingly advanced technology sector. To improve the protection of innovative patents, Chinese brands, and copyrights, China wants to establish a systematic, institutionalised, and comprehensive policy system.

In particular, China wants to expand the use of a digital copyright verification and the use of its social credit system, which, among other things, records IP infringement and aims to improve the compliance of both domestic and international producers.

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Facing the South China Sea, Qianhai doesn’t have much room for future expansion – unless further reclamation work is done. However for now, that suits local and national officials just fine: What Qianhai is set to accomplish in the coming years under the Greater Bay Area masterplan, is all about quality rather than quantity.

The area’s official name is the Qianhai-Shenzhen-Hong Kong Modern Service Industry Cooperation Zone. The name gives a hint of what it is all about: bringing Hong Kong and Shenzhen together, step by step. This gradual process foresees what will happen in 2047, when Hong Kong will officially join the People’s Republic of China.

Qianhai’s location is symbolic, too. It sits close to the Shenzhen Bay Bridge, which connects Hong Kong to the Shekou port, the area of Shenzhen where Reform and Opening began.

Today, the area is probably the most internationalised of any in China outside of Shanghai. For starters, its entertainment district looks much like Hong Kong’s clubbing district Lan Kwai Fong.

Situated ten minutes north of Shekou, around the artificially-constructed Qianhai Bay, the special zone has no barriers or fences. On this section of reclaimed land, construction crews and office workers alike work around the clock. Thanks to them, Shenzhen has come to define China’s frenetic pace of economic development like no other.

Master planners in Beijing founded Qianhai in 2009, under the framework of the province’s Pilot Free Trade Zone initiative, which includes Nansha in Guangzhou, and Hengqin in Zhuhai.

Qianhai is geographically strategic: it acts as a bridge to Hong Kong, and as a gateway for the Belt and Road Initiative. Other than its tactical position, it is a place for further economic and legal experimentation.

Authorities have devised four main goals for the area, which will serve as:

• An innovation area for modern service industry sectors
• A cluster area for the development of modern services
• A pilot area for close cooperation between the mainland and Hong Kong
• A leading area for industry upgrades in the Pearl River Delta (Greater Bay Area)

As a pilot area, it will serve as the centre for bold, innovative change. In Qianhai, new types of courts can be set up, for instance; it is a place where special incentives can be offered to investors, both corporates and individuals; a place where the challenging influences of Hong Kong can be welcomed in, contained if necessary, and adapted to China’s needs.

Although it is still largely a construction zone, Qianhai is already getting Hong Kongers through the door. Latest available data shows that a total of 8,031 Hong Kong companies have settled in the zone, which amounts to a registered capital of RMB893.726 billion. They include financial heavyweights HSBC, Bank of East Asia, and Credit Suisse.

Latest available data shows that a total of 8,031 Hong Kong companies have settled in the zone

Most of the early movers are in financial services and logistics. Altogether they contribute around 20 percent of the GDP generated in Qianhai, and pay around 23 percent of its tax revenues. However this is nothing compared to what’s in the pipeline. By the end of 2021, Qianhai aims to have a total population of 100,000 people, including 70,000 workers, plus 30,000 inhabitants.

What took so long?

By Shenzhen’s standards, Qianhai has been a slow starter. Between 2010, when reclamation work began, and the end of last year, only 182 buildings in the area had been topped-out, half of which were ready to be fitted out. With just 1.95 million square metres of usage space, it was a far cry from the 23.8 million square metres envisaged in the masterplan. Today, Qianhai is a long way from a “new Manhattan”.

Why has it taken so long to get going? Two reasons, it seems – one governed by market forces, the other by administrative forces.

The market forces at work in Qianhai provide a fascinating glimpse of the area’s potential. Unlike many other parts of Guangdong, most of Qianhai’s land was reclaimed by companies that have a longer track record of “just getting on” with development. In Guangzhou, on the contrary, the land is mainly state-owned.

Qianhai belongs to three of the most successful commercial groups in China: China International Marine Containers Group, China Merchants Group and Shenzhen International Holdings. These groups were born in the furnace of the country’s early days of Reform and Opening. It has taken the city government longer to negotiate development plans with these three than might have been expected elsewhere.

Until 2016, the government only had around a quarter of the land in Qianhai ready for development. The Guiwan and Qianwan districts went first, with 3 million square metres of the 14 million square metres total. By the end of 2017, the city government had signed off joint ventures with the big three companies, which allowed the rest of the district to get going. Now, a drive past the area reveals a hive of activity.

The land in Qianhai held by the three largest landlords

The second factor holding back Qianhai until recently was just an administrative snafu that needed time to fix. Due to restrictions on the height of buildings, companies could not get the developable floor space they needed to make a decent return on investment.

Once the 153-metre cap was raised to 280-350 metres in 2016, however, it was all systems go. Qianhai now has a total buildable area of 23.8 million square metres. With around one-third of this under construction, it will take another 13 to 15 years to complete the district’s development – which happens to be in line with the government’s target date for the Greater Bay Area, in 2035.

What comes next?

Qianhai isn’t currently the easiest place to get to from Hong Kong. To get there, you must either drive across the Shenzhen Bay Bridge with a Cross-Boundary license, or (if you can afford it), take a seven-seater limousine. But if you are living in Shenzhen, three subways connect to the area. The ferry service running into Shekou is convenient, but not as timely as busy Hong Kong investors and executives would like. That will also change fairly soon.

The planned road network for Qianhai

Currently, the high-speed railway only passes through Futian, which is a 40-minute taxi ride away from Qianhai. But in a few years, Qianhai will have no fewer than 15 railway lines running through it. In addition to Shenzhen metro lines, these will include intercity railway lines going up the coast to Dongguan and eastwards to Huizhou. In addition, the city will be equipped with high-speed railway lines direct from Kowloon West in Hong Kong.

The Qianhai transportation hub is located in Guiwan, in the middle section of Qianhai’s crescent bay. It will soon offer airport check-in services and have an immigration control station. It plans to complete the underground section by next year. Upon full completion, the hub is expected to have a daily passenger flow of 750,000. This number doubles the current number of crossings between Macau and Zhuhai at peak periods.

Where are the opportunities?

The early construction of Qianhai has been concentrated in Quiwan, Mawan and Qianwan. Among the 40 development projects, Quiwan has 24, Mawan 8 and Qianwan 9.

The projects in Quiwan started the earliest. About two-thirds of the land in Quiwan already has projects currently under construction. The 1.1 square kilometre Quiwan financial district has been made the priority.

Quiwan has a total of 8.84 million square meter building area – about half of that will be completed and be in operation within the next three years.

The innovation hub

Another incubator in the city drawing media attention is the Qianhai Shenzhen-Hong Kong Youth Entrepreneur and Innovation Hub. What makes it different is the focus on cooperation with Hong Kong entrepreneurs.

Located in the pilot district for cooperation between mainland China and Hong Kong, the incubator was established in 2014 by the Qianhai Authority. The largest youth associations in Shenzhen and Hong Kong – the Hong Kong Federation of Youth Groups and Shenzhen Youth Federation – are jointly responsible for its operation.

“By providing discounted office space, financial support and startup training, it is designed to attract entrepreneurs aged 18 to 45, with a large proportion from Hong Kong. Up to the middle of last year, it had served 388 startups, of which 190 are from Hong Kong and Macau,” says Wang Yanxia, deputy director of Qianhai Authority. The project is now expanding to a second phase, with 19,000 sqm of floor area added to the original hub, which is expected to open by the end of this year, Wenweipo reported.

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Dr Steven Kuo is a Sino-Africanist who lives in Johannesburg, South Africa, and regularly travels to Mainland China. He is Research Fellow within the School of International Relations and Public Affairs at Shanghai International Studies University (SISU). He previously taught African politics and International Security Studies at SISU and was a full-time Consultant for Chinese clients in Africa for a British risk management consultancy. Dr Kuo has a PhD from the University of St Andrews, where he focused on the study of Chinese participation in United Nations peace operations in Africa. He talks to Vikki Richardson about African reactions to the Belt and Road initiative.

 There has been much publicity surrounding the Belt and Road initiative (BRI). What are your thoughts on the significance of this project and its short, medium and long-term impact on African countries?

From an African perspective, the BRI will be a game changer and have significant impact on Africa’s substantial infrastructure deficit. With BRI’s focus on infrastructure, there can be substantial benefits for African countries’ overall economic growth in the medium and long-term, as power, roads and telecommunications receive much-needed investment.

As Chinese firms localise, they have begun to use British consultancies in areas such as risk management and public relations in order to manage local risks.

What have reactions within Africa been towards the BRI?

The reactions are mixed. Ethiopia and Kenya have led the way and have been outstanding in creating a political, economic and regulatory environment conducive to inbound Chinese investment. While South Africa remains the country that receives the most Chinese Foreign Direct Investment (FDI), the current political stalemate within the ruling ANC Party, as well as sustained distrust towards Chinese intentions from mid-level politicians, means that South Africa has not rolled out the welcome mat as wholeheartedly as it should have done to welcome Chinese inbound investments.

What are the key opportunities available to British companies within Africa, as part of cooperation alongside Chinese organisations in the BRI?

In terms of basic infrastructure, British companies can provide expertise in the areas of project finance, engineering consultancy, and environmental impact assessment as a part of identifying what is feasible.

Large Chinese construction companies are beginning to invest in African infrastructure in increasingly sophisticated ways, they are moving away from only acting as the project contractor, as the profit margins become ever tighter, and are becoming equity investors and taking part in PPP (Public Private Partnership) and other models of investment. In these endeavours, British advisors are able to lean on the UK’s reputation and expertise, and provide consultancy services to Chinese firms in Africa.

How can British companies and organisations (for example in the areas of security, insurance, logistics, and legal services) provide support to Chinese companies and organisations operating in Africa as part of the BRI?

Around five years ago, British government agencies and NGOs in Africa moved away from criticism of the Chinese model of operating in Africa (in the areas of aid, as well as investment), and have been advocating three-way cooperation with limited success. On the other hand, British companies in areas such as engineering consultancy, risk management (including security), project finance, as well as legal services, have always been ready to assist their Chinese clients in Africa. As in any market, those companies that put their clients’ interests first and offer the best solutions are doing very well.

There is a great deal of experience that Chinese companies can gain from working with British firms across the world as Chinese companies venture outside of their borders.

In addition, how can UK companies and organisations support African countries with their business dealings with China?

Many UK companies have decades of experience operating in either Hong Kong or Mainland China. UK companies in Africa can draw upon their Chinese experience and provide this to their African clients.

What are some of the main challenges and risks facing British companies who are working in cooperation with Chinese organisations under the BRI, within Africa? How can these be overcome?

British consultancies have evolved to service Western companies. As your readers are aware, there are still substantial cultural gaps between Chinese and Western ways of doing business, and a great number of British firms continue to mainly service Western clients in China. While many British firms have decades of experience in China, as well as in Africa, my experience is that the Chinese ‘old hands’ (and the local Chinese hires) do not know very much about Africa and vice-versa. Overcoming internal bureaucratic boundaries to coordinate a firm’s knowledge of Chinese clients’ needs with its African expertise can often be tricky. That the Chinese client will almost certainly have a HQ in Beijing or Shenzhen, as well as an African country office, adds to the problem of communicating and managing client expectations.

I would think that many people are stuck between Chinese clients’ expectations and British rules and regulations. I regret to confirm that there is no easy way of overcoming the cultural and bureaucratic constraints between British companies and Chinese state-owned enterprises that are spearheading the BRI in Africa. Those British companies that have won and maintained Chinese clients have done so by fully supporting their Chinese senior managers and partners.

As part of the BRI, China has provided funding for a number of ‘green tech’ projects in Africa and other countries. What do you believe to be the driving force behind China’s investment in green technology in these countries?

I think Adam Smith’s Invisible Hand is driving green investments in Africa. Electricity transmission lines are expensive and it can be difficult to coordinate different political entities. In this context, a solar or wind farm close to the energy user is the suitable solution. While BRI policy will push Chinese state-owned infrastructure companies to invest in a ‘political project’ (to satisfy Beijing’s demand to ‘Go Out’) these patently unprofitable projects remain in the minority. Chinese infrastructure and equipment supplier companies are primarily looking at return on investments when they assess bankable feasibility studies of green technology projects.

What do you believe the impact of BRI green technology projects will have on African countries involved?

I think it will differ from country to country, project to project. Those countries that are better managed, with more stable political structures and thus a brighter long-term outlook will likely do better. In those countries where governance is weak, BRI investment will become another project for corrupt politicians to take advantage of.

What are the challenges of China setting up green technology projects in Africa under the BRI?  

The larger Chinese state-owned infrastructure companies have had about a decade to find their footing and learn lessons in Africa. Similarly, African governments have also learnt to better manage Chinese projects, such as demanding skills transfer and employment of local workers. The biggest challenge is political will. The introduction of new green technology to Africa means loss of business to existing, state-owned electricity utilities. It requires political will to pacify resistance from existing suppliers and putting the necessary legislative framework in place, so that Power Purchase Agreements and supply in to the existing grid can be put in place.

How have, or how can, British companies contribute to overcoming these challenges?

British companies usually have better on the ground intelligence, and have longer experience operating in country. Chinese firms have learnt that their Chinese state-owned status and direct line to the Chinese embassy does not always offer them immunity from political risks. As Chinese firms localise, they have begun to use British consultancies in areas such as risk management and public relations in order to manage local uncertainties.

What effect do you believe UK-China cooperation and partnerships developed alongside the BRI will ultimately have on UK-China relations?

I think that the partnership and initiative from the UK in terms of working with the Chinese around the world is commendable. There is a great deal of experience that Chinese companies can gain from working with British firms across the globe as Chinese companies venture outside their borders.

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Long-time China resident, writer and journalist Tom Miller spent three years travelling around Asia along the various Belt and Road corridors to report from the front line on the effects, costs and consequences of China’s Belt and Road initiative.

In this excellent book, he manages to bring together China’s great ambitions for economic expansion and, as the sub-title says, empire building.

The book starts off with forensic research into the various ways the initiative is being funded, explaining how the failings of the established international financial institutions, such as the World Bank and the Asian Development Bank, have left China’s new Asia Infrastructure Investment Bank and the country’s many well-funded, state-owned and private banks to fill the void.

The benefits for China are obvious. It has enabled Chinese construction companies to carry out the work and for them to use the oversupply of building materials. Crucially, it has allowed China’s poorer western regions to trade efficiently with their neighbours. A more economically and politically stable region will enable everyone to benefit, it is argued. However the growth of China’s sphere of influence is also very much a key ambition.

Miller breaks the book up by region; those familiar with the Belt and Road corridors will be grateful to Miller for explaining it in such clearly demarcated geographical regions. Each chapter is brimming with case studies, examples and interviews with academics, politicians, business leaders and locals alike – all of which give a well-rounded and highly informed view from both the macro and micro-economic viewpoint.

What Miller excels at is seeing the big picture. What are China’s aims and goals in each region, each country and even each city, and why? He answers these questions, while not holding back on explaining where China has failed in its global ambition and where future risks lie.

China, Miller argues, will, of course, aim to dominate economically and militarily in Asia, and it is learning as it goes just how far it can push its neighbours in a bid to build its new empire.

“China’s Asian Dream” answers many of the questions about the consequences of China’s rise and what it means for the rest of the world.

“China’s Asian Dream” is available from Zen Books 

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To what extent is the Belt and Road initiative already benefiting the economy of China?

It is still very early days, as the initiative was only announced in late 2013 and its success can only be judged in 10 or 20 years’ time.

Having said that, there are a few indicators we can look at. At home, the Belt and Road appear to have brought new infrastructure investment, especially new roads and railways over China’s western borders. But the truth is that much of this investment would have happened anyway, so it cannot really be attributed to the initiative. Sceptics would also point out that yet more debt-fueled investment isn’t necessarily what China needs.

It is easier to look at the progress overseas. Here the aim is to place China at the centre of a trade and investment nexus stretching across Eurasia and the Indo-Pacific. Specifically, Beijing hopes state commodity producers, engineering firms and capital goods makers will find a lucrative new source of growth. It views the Belt and Road initiative as a lifeline for indebted firms suffering from weak demand at home and looking to export their overcapacity. It also calculates that better transport connections will bring prosperity to its own underdeveloped border region by transforming them into viable regions.

Official rhetoric exaggerates the potential of the Belt and Road to absorb industrial overcapacity. It is plausible that China could finance US$50-100 billion of overseas projects per year – but if you consider that China’s domestic infrastructure spending was running at about US$150 billion per month in 2015, it becomes immediately apparent that overseas construction demand will only be marginal. What government data do show are that Chinese firms signed construction contracts worth US$189 billion and earned revenues of US$145 billion in 60-odd Belt and Road countries in 2015-16. Some planned projects will not come to fruition, but the numbers are substantial and will probably grow.

Has that had a trickle-down effect in other countries or will much of the revenues generated go back to China?

Many of the construction revenues will go to Chinese construction companies and capital goods exporters. Some loans by the Chinese will be made on the condition that the recipient spends the money on Chinese goods. But China is also adamant that the Belt and Road is open to all, and it has specifically said it is willing to work with everyone. The extent to which that happens will vary from country to country. In Sri Lanka, almost all the diggers I saw at Colombo Port City were Japanese or South Korean, not Chinese.

China’s initiative will also have to dovetail with other national and sub-regional efforts, where the World Bank and ADB [Asian Development Bank] lend funds and construction firms from other countries will play a role. Chinese construction also employ local workers, while new ports and industrial zones also create jobs for locals. So there is truth in Beijing’s contention that its infrastructure push can benefit all sides.

Britain has just sent its first freight train to China along a Belt and Road corridor. Do you think the Belt and Road initiative is having direct benefits to Britain’s economy?

The UK sees the initiative as an opportunity for commercial cooperation, which explains why it was so keen to join the Asian Infrastructure Investment Bank. China claims that the initiative is open to all – the theme of the recent Belt and Road Forum was “interconnected development” and “international coordination” – and the UK is keen to work with Chinese firms in third countries. There could be opportunities in infrastructure, financial and professional services, agriculture and the environment, advanced manufacturing, transport and logistics, and energy and resources. The City could play a role in financing projects and, potentially, issuing RMB bonds.

Does Trump’s lack of experience in Asia (and, for example, his cancelling of the Trans-Pacific Partnership) give China the chance to dominate the region further?

Yes. The decision to bin the Trans-Pacific Partnership (TPP), which would have anchored the US’s economic and diplomatic presence in Asia, brings China a step closer to becoming the undisputed regional power. If the US continues to weaken its economic leadership in Asia, China will step up its efforts in order to fill the void. China is a strong supporter of the Regional Comprehensive Economic Partnership, an alternative free-trade vision to TPP that encompassing the 10 ASEAN countries and their six FTA [free-trade agreement] partners: India, Japan, South Korea, Australia, New Zealand and, crucially, China. Unless Trump comes up with policies that enhance rather than diminish Asia’s economic security, Asian states may have little alternative other than to seek a closer relationship with Beijing.  

Do we see China’s rise as the end of a singular global power and the start of a multi-polar era of power?

I don’t have a crystal ball but if Xi Jinping’s plans are realised, the 21^st century will be dominated by two superpowers: China and the US.

China’s Asian Dream: Empire Building Along the New Silk Road, by Tom Miller is out now with Zen Books. 

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One of the frustrations of dealing with China in the decade after it entered the World Trade Organisation (WTO) in 2001 was the ways in which, almost daily, the People’s Republic was clearly an emerging economic superpower but one that continued to act diplomatically like it belonged to the middle ranks. The two sides of this one story didn’t seem to add up.

Part of this imbalance was due to just how unexpected events turned out to be in this era. In the period after joining WTO, China’s economy entered a period of phenomenal GDP growth. We have to remember the assessments of most on the November evening when, after almost 14 years of haggling and hard bargaining, China became a WTO member. For many back then, the consensus was that China would struggle hard to comply with the terms it had agreed. Its domestic companies were likely to fight against foreign competition. Its very inefficient agricultural sector was ill-placed to take on entry by other players. Its state enterprises, in particular, looked doomed. And this was before even talking about the moves towards liberalising the country’s primitive nascent services and finance sector.

It is clear, as never before, that China is now a global power.

Almost two decades on, the augurs of doom look like they are referring to another place. From 2002 onwards, China experienced double digit growth year on year. No economy of similar size and complexity has ever seen anything like it. The Asian tigers all did their own version of miraculous growth but on a smaller scale. China could truly praise itself and say that it marked up figures unlike any other place on the planet. And it did this while fulfilling its WTO commitments.

Visitors in this era almost saw money growing from the ground. On a visit to Inner Mongolia in 2006, a place I lived in in the mid-1990s when it was regarded as backward, smoggy and remote, I remember the amount of wealth that was visibly being generated in the provincial capital Hohhot from the mining boom. This continued so that the autonomous region as a whole had the highest provincial growth rate in the country over this period. One local county even posted rates of over 40 percent. This sort of breakneck development had last been seen when Shenzhen, named a Special Economic Zone, was transformed from a fishing town in the early 1990s.

What was lacking over this period was a geopolitical narrative that originated in China and somehow communicated how the country understood its economic development and the meaning of this to the outside world. There were attempts to speak about “peaceful rise” in the mid-2000s. But this had limited traction in the wider world. As one observer noted to me around the time the phrase appeared, “it sounds slightly ominous”.  It didn’t catch on.

Since 2012, there has been much greater effort to spell out two things. One is what Chinese leaders, speaking on behalf of their country, think its new prominence means. China is now the largest trading partner to over 120 countries. It can no longer speak like a marginal place. It has to use a different language about its ambitions, one that accepts its prominence but does not sound intimidating.

The Belt and Road initiative sounds like an invitation, not an order.

The second thing is to communicate China’s desire to work with partners in the outside world in positive ways. It is clear, as never before, that China is now a global power. Its domestic challenges, particularly its environmental challenges, are ones that the world relates to and is impacted by. If China fails to address its challenges, that becomes an international problem, not just a local one. This is the privilege, and the burden, of sheer size.

The need to have a joint narrative to stress this commonality and to set out China’s case as a global power everyone can work with has never been more urgent. Something too prescriptive, and people get nervous, worrying about an assertive, pushy China. But saying nothing doesn’t work either. Then people start to assume the worst.

The Belt and Road initiative, and its various iterations, is the most important statement regarding China’s view of its global vision, and the first which is starting to have some resonance in the outside world. There are a number of its attributes that are now becoming clear. The first is simply that it avoids being normative by not laying down rules. The clue is in the title: it is an initiative, not a policy. In many ways, it simply clears away a space for those inside and outside China to imagine or propose, how they make the all important link. Do they want to build infrastructure, manufacture, create brands, or service logistic lines? In many ways, the idea raises questions, rather than setting out clear guidelines.

This has been one of the criticisms made of the initiative. Many, myself included in the last few years, have demanded to know what the content of the idea is. Where is the main budget coming from? Who in China has responsibility for it, and what sort of standards will it be judged against? In some ways, however, while that model might have a satisfying solidity, it falls into the trap of exposing China to criticisms by those eager to see the country look like it is laying down the law to the rest of the world.

If the language of the Belt and Road initiative is indeed the way that China intends from now on to speak to the world, then it falls short of the sort of declarations expected by some who are convinced they see a China bent on global dominance. But it also avoids the pitfall of being seen as devious, barbed and ingenuous. China is speaking about partnership, and asking for a dialogue. The question from now on therefore lies with the outside world. Now they know how China wants to speak, and the sort of things it is willing to speak about, how do they respond? This will be the key quest for the next decade or so as this epic idea develops.

Kerry Brown is Professor of Chinese Studies and Director of the Lau China Institute at King’s College, London, and an Associate Fellow of Chatham House. He is the author of “China’s World” which is published by I B Tauris in June.

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