A plan unveiled by the U.S and India last week to build what is seen as an alternative to China’s modern-day Silk Road could mean better deals for the nations along the route, according to participants at a conference in Hong Kong this week marking the 10th anniversary of Beijing’s Belt and Road Initiative, or BRI.
“I think the more the merrier, as many as possible,” said Henry Nduka Awuregu, director-general of Scholars Chamber of Commerce & Industry, which promotes good investments in Nigeria.
Announced on the sidelines of the G20 summit in India last week, the India-Middle East-Europe Economic Corridor, or IMEC, seeks to connect India with several Arabian Gulf countries in the Middle East and Europe through a trade corridor consisting of ports, a railway and better roads.
Unlike the BRI, which is aimed at securing China’s access to natural resources and building more direct trade and transport links among countries in Asia, Africa, Europe and the Middle East, IMEC is much smaller in scale and so far, does not include African, Central Asian, Southeast Asian or other South Asian countries besides India.
But delegates from countries included and even those not included told VOA it’s good for the BRI to have competition and that more connectivity will benefit global trade.
“Yeah, why not? Competition is good. The more the better. We are participating in most of them,” said Khaled Mohamed Aljassim, a board director of the Chamber of Commerce & Industry in Fujairah, United Arab Emirates.
He said countries should not be pressured, however, to choose between the BRI or the IMEC and should be able to join both should they choose to. The UAE is a part of BRI but is also a IMEC signatory, along with Italy and Saudi Arabia.
“We’re open to (working with) any country; we don’t want to choose (between one or the other),” Aljassim said, adding that the UAE has benefitted from learning technology know-how through the BRI.
Pakistan’s deputy consul general in Hong Kong, Muhammad Amjad Ahmad, said it could take a long time for IMEC to show results.
“Where it [IMEC] actually goes, it’s too early to say something about that. … If it [IMEC] materializes, it’s going to take a long, long [time], even decades. Like the BRI, it’s not a matter of days or years; it’s a matter of decades,” Ahmad said.
“The Chinese initiative, the BRI, is on the ground, they have added a lot, investments have been made, regions have been connected,” he said.
He noted that one of the flagship BRI projects — the China-Pakistan Economic Corridor, or CPEC, launched in 2013 — has achieved tangible progress with about $60 billion worth of investments made so far.
CPEC aims to build a 3,000-kilometer corridor that would include a deep-water port, a new road and a railway, greatly reducing transportation time for Middle East oil to reach China. The route passes through Pakistan, bypassing the time-consuming sea route through the Malacca Strait and the South China Sea.
In return, Pakistan gets modernized transportation networks and special economic zones, which are expected to help its economy grow.
“It’s quite satisfactory. It’s moving in the right direction,” Ahmad said. “We are definitely working on the CPEC and hopefully it’s going to be the game changer and it would lead to the development of the region as well as all those areas falling on the BRI.”
The ambitious BRI plan calls for a network of ports, railways, airports and other transportation links spanning Asia, the Middle East, Africa and Europe. In its 10th year, it has seen more than 150 countries and upward of 30 international organizations sign cooperation agreements with China, according to Hong Kong’s Chief Executive John Lee at the conference’s opening ceremony.
“That, ladies and gentlemen, has set in motion more than 3,000 cooperation projects — nearly $1 trillion in investment toward a multiplicity of national landmarks, bilateral developments and livelihood initiatives,” Lee said. “Collectively, they account for about 40% of the global GDP and 45% of the world's merchandise trade.”
The plan has hit obstacles, though, with China and its investment companies having to pay for much of the infrastructure construction and not sure if their loans will be paid back. Recipient countries also are worried they could lose control of key infrastructure in long-term lease deals and be saddled with debts they can’t repay.
The IMEC announcement comes as the United States has grown increasingly concerned about China’s growing economic clout and expanding reach around the world. It has warned other countries of being drawn into debt traps.
Zheng Yanxiong, director of Beijing’s office in Hong Kong, said at the conference that the United States, despite expressing dissatisfaction with the belt and road plan, has nonetheless benefited from it.
“Its industrial and supply chains have been further secured due to China. China has provided popular, affordable and quality consumer goods. Many enterprises also rely on China’s market to survive,” he said, according to the South China Morning Post.
“The US should cherish the opportunities brought to the world by the initiative rather than criticizing and obstructing it. Any disadvantageous actions to the initiative cannot gain support and are harmful to oneself.”
At the same time, Italy — the only nation from the G7 club of industrialized countries that has joined China’s initiative — has signaled it may withdraw from it this year. A top government official recently expressed disappointment over Italy’s exports to China, pointing out they were much less than those of other European countries that hadn’t joined China’s plan.
Among the 6,000 participants from 70 countries at the Hong Kong conference were delegates representing more than 35 Chinese state-owned enterprises, some of which have invested in BRI projects.
Declining to be named, one of them said he saw the U.S.-India plan as an attempt to counter China. The BRI has tried to include India, though New Delhi has declined to join, but the IMEC bypasses China.
“The world is changing. U.S.-China relations are bad. This plan is to confront China. Both sides will be impacted, and it will divide the world into two halves,” he said.
His colleague, another Chinese delegate, was more optimistic.
“Another way to look at it is that competition is good for everyone,” he said. “The two plans don’t have to have an impact on each other. You do one and I do one. Just think about the competition between the U.S. and China. We learned so much from the U.S.”
Regardless of the plan or which country is spearheading it, Awuregu from Nigeria said investors should not simply tap developing countries for their natural resources, but instead help them to develop their economies by nurturing local talent.
“There’s nothing wrong with China coming to Nigeria to build factories, but what we’re seeing now is mining of our natural resources, taking them away crude,” said Awuregu, who promotes investments in human capital in Nigeria. Nigeria and China
“There’s a need for them to establish industries and process [the natural resources] into value chains; then there will be job opportunities for the population of Nigerians, there will be increase in intellectual knowledge … and there will be that mutual, bilateral harmony between Nigeria and China. For now, a lot of people feel cheated.”
His advice to countries wanting to build trade corridors is simply: “mutual respect,” “equity” and “fairness.”
Regardless of whether it’s China, the U.S., or India, Awuregu said, "We want them to respect that, so that it will be a win-win situation.”