In the first decade of his government, which will be extended by another term that many see as potentially lifelong, Xi Jinping sought to increase China’s external insertion through various means: political assertiveness, military expansion and, above all, its economic weight.
No action, however, supplants the Belt and Road Initiative, as a symbol of the ambition and limits of the Chinese leader’s modus operandi. Started in Xi’s second year at the helm of the dictatorship, 2013, it poured about US$1 trillion, in unadjusted amounts, in 149 countries and 30 international bodies.
There were direct investments, participation funds and several loans for projects mainly in infrastructure. The main customers are in Asia, Africa and Latin America, markets where the arrival of Chinese money knocked the United States out of its role as the world’s biggest creditor.
Washington felt the blow. To take an example close to Brazil, the US Southern Command was one of the first to denounce what is conventionally called the debt trap — draconian loan conditions that, in practice, tied countries to Beijing.
The fact that it was a criticism made by a military body says a lot about the political mood, but the problems were evident. Zambia and Sri Lanka have all but broken with Chinese policy, and last year alone there were about $20 billion in loans being renegotiated, according to Western consultants.
The problem was also in the nature of projects. The environmental impact of Chinese dams in Laos, aimed at making the country a source of energy in Southeast Asia, is an almost universal object of criticism. Works that were stopped or useless railways, ditto.
But not everything is a burden. Belt and Road effectively placed Pakistan under the Chinese umbrella, promoting a regional counterpoint to India: Islamabad’s biggest rival, New Delhi, has political confrontation with Beijing as one of its priorities.
In the Asian country, China put almost US$ 40 billion, also ensuring an alternative passage of products to the Indian Ocean, through the port of Gwadar. The side effect was the Pakistani financial crisis, which led the country to knock on the doors of the International Monetary Fund in 2019.
Economically, doors were opened. Today, China is the main partner of 120 countries, including Brazil — the country is not a member of the Belt and Road, but it was the biggest destination for investment in Chinese infrastructure on the continent (US$ 66 million, without correction, from 2010 to 2020 ).
The Chinese search for alternatives for the disposal of its exports also bore fruit with the initiative. In 2011, there were 17 freight trains with regular routes connecting the country to Europe. Today, there are 15,000, some with altered routes due to the Ukrainian War.
Russia, by the way, saw in the initiative a way to materialize its growing political alliance with Xi. By 2020, it had received about $60 billion in loans, according to the World Bank. The situation has completely changed with the conflict and Western sanctions, prompting Xi to open a lifeline for Vladimir Putin with increased purchases of discounted hydrocarbons.
In any case, the initiative received so much criticism and threats of trade retaliation that China began to reformulate its plans, taking advantage of the global economy’s choking with the Covid-19 pandemic. There was a reduction in the stock of foreign investment, which according to the Chinese regime was US$ 56.5 billion in 2021, 44% of which was used in energy projects.
Even the diplomacy that accompanied the whole process, often based on aggressive tweets by ambassadors against rivals, lost some of the impetus of the “warrior wolf” – a nickname for these diplomats taken from a popular Chinese action movie.
Another tumble occurred in a parallel move, the attempt to expand China’s presence in the world’s 5G infrastructure. Several countries either completely vetoed companies like Huawei from their networks, like several Europeans, or limited their participation, in the case of Brazil. The American rhetoric of espionage and dependency risk, while ironic given the US record, stuck.
On the other hand, contacts established around the world helped Xi promote his vaccine diplomacy in the pandemic. Coronavac only arrived quickly at Butantan because the São Paulo government had opened an office in Shanghai months before and signed a cooperation agreement with Sinovac.
Since last year, there has been a reduction in emphasis on the term Belt and Road Initiative, even for referring to the Silk Road, the ancient trade link between China and the West. Now the watchword is the Global Development Initiative, taken by Xi in his speech at the UN General Assembly last year.
Since then, according to a survey published by researcher Andreea Brînza, from the Romanian Institute for Asia-Pacific Studies, 14 of the leader’s 15 speeches cited the new term. Belt and Road became the qualification of practices, mentioned as cooperatives, on 8 occasions.
In other words, the outfit is being redesigned. In his speeches, Xi often cites the environmentally responsible aspect of the new program’s initiatives, playing music for ESG funds that need to be accountable to their investors. It is not clear what will come of this, of course, but what is certain is the sequence of Chinese assertiveness under the enduring leader.
With a wealth of experience honed over 4+ years in journalism, I bring a seasoned voice to the world of news. Currently, I work as a freelance writer and editor, always seeking new opportunities to tell compelling stories in the field of world news.
