10 February 2017

China’s OBOR: opportunities and challenges

Is One Belt, One Road (OBOR) initiative the beckoning call for China to become a global hegemon? Will it be successful in reviving China’s economic and soft power ambition on the world stage? And finally, what are the challenges and problems with OBOR in its current state? Questions like these and many more were discussed at the evening talk titled, ‘Understanding and Securing the Belt and Road: The View from the Ground’, held on 23 January 2017 at the Lee Kuan Yew School of Public Policy.

Li Ka Shing Professor Khong Yeun Foong and Director of International Security Studies at the Royal United Services Institute (RUSI) Rafaello Pantucci discussed the historical and current economic trajectory that OBOR has undertaken and will continue to tread in the future. The two major routes that China has planned under OBOR were highlighted, one through land, passing across South Asia into Central Asia and the other involving maritime routes reaching all the way to African coasts.

Professor Khong elaborated the main themes of China’s geopolitics and economics, highlighting the economic opportunity that OBOR presents among nearly 64 nations as the way for China to become a hegemon in Asia and beyond. He stated three reasons as the main driving vehicles directing OBOR as China’s return to greatness. 

First, geopolitical dimension of OBOR, which places China in the economic-political orbit of many Asian and European powers. Thereby, providing China with a political hold over land and possibly the maritime routes. 

Second, OBOR acts as a link between economic and political partnerships in the region. Historically speaking, nations tend to align themselves strategically towards their economic partners, and in recent times, China has overtaken United States, as being the number one trading partner in the region. With this development, trading partners of China have to be sensitive towards its political interests. 

Third, China’s soft power might lie in establishing OBOR, through infrastructure construction and harnessing connections in untapped markets in the partnering countries. OBOR is also based on China’s historical narrative of the golden age which consisted of the ancient silk road and maritime routes. 

However, Professor Khong, did express doubts about OBOR’s success, with regard to U.S.’ strategic worries, India-Pakistan border issues in disputed territories of Kashmir across which OBOR links are planned, Russia’s reservations about China’s expansion into Asia and a possible resentment to this project by some Muslim countries in South Asia.

Professor Khong emphasised the relevance of OBOR in the light of the now-failed Trans-Pacific Partnership (TPP). TPP would have been a channel of exercising U.S.’ economic centrality in the Asian region, with countries like Singapore, New Zealand and Japan as part of the deal. The U.S. stood as the second best option to China in terms of economic partnership, however, in its absence the regional-economic architecture will be moulded by Chinese initiatives like the Regional Comprehensive Economic Partnership (RCEP), Asian Infrastructure Investment Bank (AIIB) and Free Trade Area of the Asia-Pacific (FTAAP), among others.

Rafaello Pantucci began the discussion with an emphasis on the role of Xinjiang region (north-western China) through the establishment of OBOR. Xinjiang has undergone ethnic tensions in the past and has had limited socio-economic development. China has therefore chartered trade corridors from Xinjiang to Central Asian countries such as Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. However, despite planned economic channels, OBOR faces some problems, potentially in the area of security. 

First, there are operating separatist groups and deeply divided ethnic communities in Central and South Asia, which do not associate to their central governments, for example, in the Balochistan province of Pakistan, through which the China-Pakistan Economic Corridor (CPEC) is planned. CPEC is part of OBOR, which according to the separatists is seen as part of Pakistan government, making Chinese establishments become proxy targets in that area. 

Second, terrorism is also an issue to be concerned, in places where domestic terrorist organisations link with international ones like Al-Qaida and the Islamic State, harbouring resent against Chinese establishments. 

Third, local political disputes between countries in Central Asia, can create problems for the successful implementation OBOR. There could be issues in terms of co-operation and connectivity between neighbouring countries, slowing down OBOR’s pace of development and trade in the region. 

Fourth, local benefits are limited in large infrastructural projects such as the ones in OBOR which require Chinese expertise, and can deepen the existing inequalities in the countries. 

In conclusion, both the speakers agreed that opportunities and challenges exist for China with its ambitious Belt and Road Initiative, and it remains to be seen how successful will it be for the partnering nations and the Asian region as a whole.

Extracts for preview:

Early in his book, Friedberg identifies five factors that supposedly work in favor of U.S.-China cooperation and two that work against it. The former are U.S.-China economic interdependence, China’s becoming a democracy, China’s enmeshment in international institutions, the presence of common challenges and threats, and the existence of nuclear weapons. The two factors that make rivalry and conflict likely are “the narrowing gap in national power and the continuing deep differences in their [China’s and the United States’] ideologies and domestic political structures”. In this five-to-two lineup, Friedberg judges the two favoring competition to be “stronger and more deeply rooted”. They trump the five that foster cooperation.

The rest of Asia is less worried about China. The strategic orientations of these other countries have been described as “hedging”—a policy of engaging both the United States and China in the hope of “not having to choose” between them. During the Cold War, they were content to align themselves explicitly with the United States, in part because of what China was (a communist state) and what it did (supporting local communist insurgencies). All things considered, then, it will prove extremely difficult today for the United States to corral a serious Asian coalition to check China’s power. That is why, for White, the United States, as the existing hegemon, has to share power. To be sure, for now and the foreseeable future, most countries in Asia would not want China to replace the United States as the hegemon—the ideal would be a situation where neither is the hegemon (i.e., White’s power-sharing solution), which White sees as the only guarantee of peace and stability. 

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