The Belt and Road Initiative: understanding the geopolitical and geo-economic logic of China’s “New Silk Roads”



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Dr Michael Clarke is Associate Professor at the National Security College, ANU and Co-Director of the ANU-Indiana University Pan-Asia Institute. He is the author of Xinjiang and China’s Rise in Central Asia: A History (Routledge 2011) and editor of China’s Frontier Regions: Ethnicity, Economic Integration and Foreign Relations (I. B. Tauris 2016).

The Belt and Road Initiative provides China an unprecedented opportunity to achieve economic, political and military ambitions through this all-encompassing initiative, writes Dr Michael Clarke.

There is now little doubt that the Belt and Road Initiative (BRI) is now China’s flagship foreign policy initiative. At the 14 May 2017 Belt and Road Forum in Beijing President Xi Jinping declaimed to an audience of international leaders and dignitaries that BRI was “a project of the century” that “will benefit people across the world”[i]
 
Despite Xi’s confident assertion, there does however remain significant doubt regarding not only the motivations and intentions but also the practicality of BRI. Indeed, BRI, encompassing six “economic corridors” linking the Chinese economy with the major continental and maritime zones of the Eurasian continent and the establishment of supporting multilateral financial institutions such as the Asian Infrastructure and Investment Bank (AIIB) and Silk Road Fund (SRF), is nothing if not ambitious.
 
Such ambition has been viewed by various observers as driven either by China’s geopolitical goals to break perceived US “encirclement” in the Asia Pacific and constrain the rise of India,[ii] its desire to break the Chinese economy out of its post-GFC slowdown[iii], or as a “soft power” push to burnish China’s image.
 
BRI is in fact all of these things and constitutes a geopolitical and geo-economic agenda to enhance China’s global power and the legitimacy of the Chinese Communist Party (CCP).
 
Geopolitically, BRI aims to overcome the dilemmas arising from China’s geopolitical hybridity — i.e. simultaneously possessing continental and maritime orientations - and perceived containment by American predominance in the maritime domain of the Indo-Pacific. BRI is also driven by a geo-economic logic[iv] that seeks to leverage “economic instruments to promote core national interests” (for example, the longevity of the CCP) and secure geopolitical objectives.
 
Significantly, BRI, understood in this manner, is also consistent with President Xi’s ideological “master narrative” of the “China Dream” of “great national rejuvenation”. Here, BRI is both an expression of, and instrument for achieving, China’s “return” to the centre of the global stage.
 
In a geopolitical context BRI finds a favourable environment due to the uncertainties generated by the Obama Administration’s incomplete “rebalance” to Asia and the advent of the Trump Administration and its introverted, “America First” foreign policy agenda. Where the former raised “a crisis of expectations” amongst long-standing American allies regarding the scope and strength of this recommitment to Asia,[v] the latter presents the region with an “unbalanced, unconnected, and unstable” American approach “characterised by either narrow transactionalism or constant see-sawing” on pressing regional issues from multilateral trade to the North Korean crisis.[vi]
 
Such uncertainty has enhanced Beijing’s ability to portray BRI as emblematic of China’s “return” to great power status and its willingness to assume a “responsible” global leadership role. BRI, and its associated components such as the AIIB and SRF, are presented by China as illustrative not only of its willingness and capability to become a provider rather than “free-rider” of international public goods[vii] but also of its stabilising role in international affairs in a time of considerable geopolitical flux.

Economically, BRI seeks to paper over significant structural challenges which, left unaddressed, could undermine President Xi and the CCP’s legitimacy. These include finding outlets for industrial over-capacity, regional economic imbalances, as well as combating ethnic challenges in regions such as Xinjiang and Tibet, and wider demographic and environmental strains.

BRI will contribute to China’s efforts to overcome industrial over-capacity, for instance, via its heavy emphasis on infrastructure development which it is hoped will move excess production capacity out of China and help “reduce the supply glut at home while helping less developed countries to build up their industrial bases.”[viii] In fact, the State Council of the PRC has identified BRI as a mechanism through which the Chinese steel industry can export excess capacity, diversify exports and develop greater international competitiveness.  The “20,000km of new railways” under the BRI for example, Jonathan Holsag argues[ix], “could create demand for as much as 85 million tons of steel”, “diversify exports to countries like Vietnam, Turkey, Iran and Saudi Arabia” and compel Chinese steel companies to compete for contracts.

Redressing regional economic imbalances via enhancing economic inter-connectivity and integration through the development of “special economic zones” and urban “hubs” along the constituent economic corridors of BRI, such as the major Xinjiang city of Kashgar’s role in the China-Pakistan Economic Corridor (CPEC), is also a major goal. Such economic inter-connectivity is conceived of accelerating the development of China’s frontier regions by reducing barriers to trade and facilitating flows of capital and commodities to market.[x]

Enhancing Chinese access to natural resources, particularly energy resources, is also a major driver of BRI with the majority of the six identified economic corridors involving significant energy-related infrastructure developments and investments including pipelines to Russia, Central Asia, and the Indian Ocean.

While certainly not a new Chinese concern, security of access to natural resources is now both a core economic and strategic interest for Beijing.[xi] China’s US$ 50 billion commitment to CPEC — linking Xinjiang’s Kashgar with Pakistan’s deep-water port of Gwadar on the Arabian Sea — encapsulates the harmonisation of the geopolitical and geo-economic logic of BRI.[xii] CPEC, if successful, will not only provide Beijing with over-land access to the Arabian Sea and the economies of the Persian Gulf but also assist it in mitigating its over-reliance on sea-borne trade – long viewed as a major liability in the event of conflict with the United States.[xiii]

BRI is thus intimately connected to China’s efforts to come to grips with the opportunities and challenges deriving from its geopolitical hybridity. China is seeking through BRI to establish a favourable strategic balance along its Eurasian continental frontiers to militate against the continued pre-eminence of the United States and its allies in the maritime zones of the Indo-Pacific. Meanwhile, Beijing envisages that the domestic dimensions of BRI, in particular the establishment of specific regional “hubs” for BRI’s six “economic corridors”, will enable it to shore-up the economic growth and development on which the CCP’s legitimacy rests and facilitate access to overland trade, communication and energy flows to Central Asia, South Asia and the Middle East that will lessen reliance on SLOCs vulnerable to American maritime power.

Read CEDA's research report, Australia's place in the world.

 
[i] Jinping, X. “Work together to build the Silk Road economic belt and the 21st century maritime Silk Road.” Speech at the opening ceremony of the Belt and Road forum for international cooperation, 14 May 2017. The China Daily, 14 May 2017. 
[ii] Tellis, AJ. “Protecting American primacy in the Indo-Pacific.” Testimony to the Senate Armed Services Committee, 25 April 2017. Carnegie Development for International Peace. 
[iii] Cai, P. “Understanding China’s Belt and Road initiative.” Lowy Institute Analysis, 22 March 2017. 
[iv] Blackwill, RD and Harris, JM. War by other means: Geoecnomics and statecraft. The Belknap Press of Harvard University Press, Cambridge, Massachusetts, 2016. 
[v] Lyon, R. “Assessing the US rebalance to the Asia Pacific,” The Strategist, Australian Strategic Policy Institute, 16 January 2016. 
[vi] Parameswaran, P. “The ticking clock on Trump’s Asia strategy.” The Diplomat, 6 July 2017. 
[vii] Beeson, M and Li, F. “China's Place in Regional and Global Governance: A New World Comes Into View,” Global Policy, Volume 7, Issue 4, 2016, pp 491-499.
[viii] Cai, P. “Understanding China’s Belt and Road initiative.” Lowy Institute Analysis, 22 March 2017. 
[ix] Holslag, J. “How China’s new Silk Road threatens European trade,” The International Spectator: Italian Journal of International Affairs, Volume 52, 2017 – Issue 1, pp 46-60.
[x] Summers, T. “China’s ‘New Silk Roads’: sub-national regions and networks of global political economy,” Third World Quarterly, Volume 37, 2016 – Issue 9, pp 1628-1643.
[xi] Len, C. “China's 21st Century Maritime Silk Road Initiative, Energy Security and SLOC Access,” Maritime Affairs: Journal of the National Maritime Foundation of India, Volume 11, 2015 – Issue 1, pp 1-18.
[xii] Ramachandran, S. “China-Pakistan Economic Corridor: Road to Riches?” China Brief, Volume: 15 Issue: 15, 31 July 2015. 
[xiii] Brewster, D. “Silk Roads and Strings of Pearls: The Strategic Geography of China’s New Pathways in the Indian Ocean,” Geopolitics, Volume 22, 2017 – Issue 2, pp 269-291.


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