Prospering with Belt and Road to reap the benefits of China’s initiative


Malaysia is one of 64 countries to reap the benefits of China’s initiative.

CAN money grow on fruit trees?

Yes, that is as far as Agriculture and Agro-based Industry Minister Datuk Seri Ahmad Shabery Cheek is concerned.

After witnessing the signing of a deal worth US$1.53bil (RM6.65bil) between Malaysia’s AgroFresh International and China’s Dashang Group for the export of local Cavendish bananas and tropical fruits to China, he said:

“Money does grow on fruit trees if our agriculture products could open up China’s market.”

The deal was part of the nine memorandums of understanding (MoUs) and agreements, with value totalling more than US$7.22bil (RM31.26bil), which were signed between Malaysian and Chinese companies on May 14.

But Datuk Seri Ong Ka Chuan, International Trade and Industry Minister II, sees more money flooding in once Malaysia is linked up with other Asean nations, China and Europe via rail connection under China’s Belt and Road Initiative, now termed as the New Silk Road project.

“Our trade figures can jump by three to four folds once Malaysia can export and import goods to our major trade partners (such as China, Europe and Middle East) overland via rail systems,” he tells Sunday Star.

Both ministers are among Cabinet members in the Malaysian delegation led by Prime Minister Datuk Seri Najib Tun Razak to attend the Belt and Road Forum for International Cooperation held in Beijing from May 14 to 15.

Malaysia is one of the 64 countries outside China that have benefited from the Belt and Road Initiative, propounded by Chinese President Xi Jinping in the autumn of 2013.

One project to be launched soon will be the RM55bil East Coast Rail Link. Examples of existing projects include Xiamen University and the deepening of Kuantan Port.

At the opening ceremony of the forum, Xi injected fresh impetus to his pet project by announcing hundreds of billions in new funds for infrastructure investment in Belt and Road countries that span Asia, Middle East and Europe.

According to some estimates, Chinese funds allocated for investing in Belt and Road countries – which include several exiting funds announced since 2013 – total around US$900bil (about RM4 trillion) now.

“Model of regional cooperation”

From Mongolia to Malaysia, Thailand to Pakistan and Laos to Uzbekistan, many projects, including high-speed railways, bridges, ports, industrial parks, oil pipelines and power grids, are being built, Xi said.

Since 2013, Chinese private businesses have invested more than US$60bil (RM260bil) in countries along the Belt and Road, in addition to the US$50bil invested by the Chinese government.

Xi’s speech also reveals that China will expand China-Europe railway cargo services, which are stirring up excitement in European nations – particularly Britain.

Belt-road: Ong signing Belt and Road MoU with Vice Chairman of National Development and Reform Commission of China Zhong Yong on May 13, 2017. Witnessing are Najib and China’s Premier Li Keqiang.

Calling his brand of globalisation as “project of the century” to achieve a win-win situation for all, Xi has committed to importing US$2 trillion (RM8.7bil) of goods from the 64 Belt and Road countries – many of which are under-developed and impoverished nations hungry for infrastructure and industrial investments.

The Chinese leader’s pledge of “non-interference” with the domestic politics of other countries is comforting, given that there are concerns that China could aim to be a hegemony with its economic and military might.

“What we hope is to create a big family where we can co-exist harmoniously,” Xi said last Sunday in his speech that also focused on connectivity in policy, infrastructure, trade, finance and people.

The forum is by far the most important and largest meeting on the Belt and Road Initiative since 2013.

About 130 countries were represented at the forum and they accounted for two thirds of the world’s population. Their combined gross domestic product accounts for 90% of the world’s total, according to Xinhua.

Klaus Schwab, founder and executive chairman of the World Economic Forum, regards the Belt and Road Initiative as “a shining model for regional collaboration, development and growth”.

“This initiative respects the differences between countries and their various paths for development, not imposing a specific plan or ideological framework, but seeking to create common ground for cooperation and mutual benefit,” Schwab told Xinhua.

UN secretary-general Antonio Guterres, also told Xinhua: “China will play a very important role in multi-lateralism with the Belt and Road. The initiative reflects a new model of international cooperation and interaction with mutually beneficial cooperation through the connection of policies and development strategies.”

And Jack Ma, executive chairman of Alibaba Group, shared: “The initiative goes far beyond the economic strategy of any single country or region. Its mission is to make the world more innovative, dynamic, and equal.”

Big step: Fernandes is excited that China has allowed AirAsia to be the first low-cost carrier to set up shop in the Middle Kingdom.

AirAsia deal – another first in China

On the sideline of the forum, Malaysian and Chinese leaders took the opportunity to clinch more agreements that brought bilateral ties to another new high.

While the deals signed last November were far more than this round and higher in total value, the Chinese Government continued to grant “first” to Malaysia. This was reflected in a project given to Tan Sri Tony Fernandes, group chief executive officer and founder of AirAsia Bhd. Soon, the sky will see AirAsia China.

“It is the first time a foreign airline is given permission to establish and operate a low-cost carrier in China. We are the first country to be granted such licence,” Najib told reporters at the conclusion of his visit to China.

AirAsia is establishing a joint venture with China Everbright Group, with an initial stake of 22%. However, AirAsia may raise its stake in future.

China Everbright is a government-owned financial services conglomerate, which is a major shareholder in China Aircraft Leasing Group Holdings Ltd and the Henan Government Working Group.

The plan is to set up AirAsia China to be based in Zhengzhou, the capital of Henan, to ply domestic and international flights.

“Tony Fernandes was very excited because he was able to meet the top transport and aviation officials, whom he could not secure appointments with previously. He has been working on this project for years,” a minister told Sunday Star.

Other Cabinet ministers are also upbeat after attending the Belt and Road Forum.

“I have witnessed the fruits of the close diplomatic ties between Malaysia and China, and between Najib and Xi Jinping during this trip,” says Transport Minister Datuk Seri Liow Tiong Lai, who signed a MoU on infrastructure cooperation with China.

“In China, economic developments are influenced by government policies. Now that our leaders have good ties with China, it is very timely for Malaysian businessmen to enter China, and vice versa,” he tells Sunday Star.

Important talks: Liow (second from left) leading a Malaysian delegation at a meeting with his Chinese counterpart at China’s Transport Ministry in Beijing on May 12 morning. From left are Transport Ministry deputy secretary-general Datuk Chua Kok Ching, MCA vice president Datuk Dr Hou Kok Chung and Fernandes.

“We have to promote economic growth fast enough so that we can harvest the fruits of the Belt and Road Initiative.

“The opportunities for Malaysia to develop the infrastructure and boost economic growth would not be available if not for the Belt and Road Initiative pushed forward by China,” he adds.

Minister in the Prime Minister’s Department Datuk Seri Dr Wee Ka Siong observes: “There are quite a number of business-to-business MoUs signed during this trip, in addition to the nine witnessed by Prime Minister Datuk Seri Najib Tun Razak.

“I was also invited to attend many discussions and meetings, sometimes I had to have many meals a day! (as discussions were held over meals).”

Wee, whose ministerial portfolio covers development of Chinese small and medium enterprises (SMEs), has personally requested Ma to reduce charges for Malaysian SMEs when they use Alibaba’s platform to sell products.

Ma, an e-commerce wizard and China’s second richest man, is expected to give consideration to the proposal as he has pledged to help Malaysia develop its digital economy. Ma will set up the Asean data centre in Malaysia before the end of the year.

Analysing Belt and Road Initiative, Shabery Cheek says: “Belt and Road is a different form of cooperation from other pacts, such as the Trans-Pacific Partnership (TPP) and World Trade Organisation (WTO). Those emphasised on what goods were tax-free and what were not, which sectors to open up and which could not. Essentially, they focused on how to protect the self-interests of individual countries.

“However, the Belt and Road talks about infrastructure networking, which is very important. They take the cue from the ancient Silk Road, which was not only a channel to transport goods, but also to spread Islam and Buddhism. That is a great thing.”

Source: Sunday Star by Ho Wah FoonTho Xin Yi

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America vs China: odds narrowing


Leaders meet: A file picture showing Trump welcoming Xi to the Mar-a-Lago estate in West Palm Beach, Florida during the latter’s visit to the US recently. Xi has a growing economy too behind him, whatever the hiccups. Trump only promises one, without any clarity or logic. – AFP

THE contrast could not be greater. While United States president Donald Trump raves and rants – and belts this or that person – China’s president Xi Jinping looks measured and assured as he offers a global future to the world.

Xi is no angel of course, as his political opponents would know, but his system conserves and protects him, as Trump’s would not. If only Trump were the leader in a centrally controlled political order – but even then his temperament would blow it apart.

Leadership, like politics, is the art of managing the possible. Trump does not understand this, and does not know how. Xi does, knows why, and knows how.

He has a growing economy too behind him, whatever the hiccups. Trump only promises one, without any clarity or logic.

His plan to boost the American economy, based primarily on slashing corporate tax from 35 to 15%, is likely to flounder in an American Congress seriously concerned about its causing the fiscal deficit to balloon.

Already Trump has had to climb down from trying to secure funds from Congress for his dreaded border wall with Mexico in order to avoid budgetary shutdown in September.

The stock market has fallen back from the boost to the price of banks and industrial products following his election. Interest now has returned to what might be termed “American ingenuity stocks” such as Google, Apple and Microsoft on Nasdaq – a proxy for much that is great about America, which Trump’s immigration and closed-door policies threaten to destroy.

Meanwhile Xi has been rolling out his “Belt and Road” plans – something he first envisaged at the end of 2013 – for greater world connectivity and development, committing funds from China and the Asian Infrastructure Investment Bank, and engaging global financial institutions such as the World Bank.

Malaysia, for instance, will be an actual beneficiary with additional projects thrown in. China is Malaysia’s largest trading partner. But the US has not been a laggard, being Malaysia’s fourth largest trading partner. And indeed the US remains the largest foreign investor in Malaysia, both new investments and total stock.

A staggering statistic not often recognised is that total American investment in Asean is more than its investment in China, Japan and India COMBINED!

The point, however, is that this position is being eroded. Trump’s policies are hastening this process. Abandonment of the Trans-Pacific Partnership (TPP) means there is no American strategic peaceful challenge to the Chinese economic juggernaut in Asia-Pacific.

Balance is important to afford choice. Absence of choice means serious exposure to risk. Price, quality and after-service standards are affected, not to mention a new geostrategic economic underlining.

Over-dominance by China in the region is a price not only countries in the region will pay, something that most probably is on Trump’s mind. It is a price that America too will sooner or later have to pay.

China’s Belt and Road proposition is not without its challenges, of course. India is deeply suspicious of the connectivity with Pakistan which cuts across India-claimed Azad Kashmir, about 3000km of it.

The link to the Pakistani port of Gwadar, in southwest Baluchistan on the shores of the Arabian Sea, is seen by India as a Chinese presence at the entrance to the Indian Ocean and a hawk eye on the Indian sub-continent. With the Chinese also in Sri Lanka, India is circumspect on China’s Belt and Road initiative.

There have also been commentaries on some uneconomic linkages which extend right across the English Channel.

All these reservations, however, do not take into account the benefit of connectivity to economies, the time it often takes to get those economic benefits and, most of all, the patience, persistence and long view of history of China and its leaders.

One of the most striking things about the Belt and Road map is that America is not there. Of course, Xi Jinping does not preclude America just as much as the US did not say that China was not permanently excluded from the TPP. And of course, in the Old Silk Routes and shipping lanes, the New World – America – had not been discovered.

But in their revival, led by now rising and then ancient China after 150 years of national humiliation to the present time, there is the irony that the last three quarters of a century of America world dominance is on course to be marginalised, if not supplanted, by the old Eurasian world centred in an ancient civilisation.

Trump does not seem to understand history. The art of the deal is purely transactional. Short-tempered and short-term gratification does not a strategy constitute.

So we have leader, system and economic promise distinguishing the two leaders – and the two countries.

Instead of America first, what we are seeing is Trump hurrying America’s decline relative to a rising China.

We are not seeing a world changed from people wanting to be like a kind of American to being people wanting to be a kind of Chinese. Actually, the Chinese people themselves want to be like a kind of American, with all that wealth, influence and power.

What we are seeing is China – not America – leading the way to that desired, if not always desirable, end. It is China that is driving the next phase in the evolution of world economic development.

Under Xi Jinping, China appears to be heroically moving towards an epochal point in its Peaceful Rise. With Donald Trump, America is being led backwards and inwards, with all the problems of its governance now all coming out. It is in grave danger of losing in the peaceful competition.

Not knowing how to play that game – certainly under its current President – there remains the danger of the status quo power lashing out against the rising one.

The Greek historian Thucydides observed: “It was the rise of Athens and the fear that this instilled in Sparta that made war inevitable.”

A Harvard professor has studied what is now called the Thucydides Trap and found in 12 out of 16 cases in which this occurred in the last 500 years, the outcome was war.

There are many potential flash points against the background of China’s rise – the North Korean Peninsula and the placement of THAAD missiles in the south, the South China Sea – where Trump may temperamentally find cause to lash out. This is the trapdoor he might take the world down because of failure to compete peacefully.

By munir majid – crux The Star

Tan Sri Munir Majid, chairman of Bank Muamalat and visiting senior fellow at LSE Ideas (Centre for International Affairs, Diplomacy and Strategy), is also chairman of CIMB Asean Research Institute.
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One Belt One Road paving the way to success


In 2013, Chinese President Xi Jinping proposed building the Silk Road Economic Belt and 21st-Century Maritime Silk Road, which became known as the Belt and Road Initiative.

Countries along the Belt and Road have their own resource advantages, and their economies are mutually complementary. This means there is a great potential and space for cooperation.

Connecting facilities is a priority in implementing the initiative. On the basis of respecting each other’s sovereignty and security concerns, countries along the Belt and Road are improving the connectivity of their infrastructure construction plans and technical standard systems, jointly pushing forward the construction of international passageways, and forming an infrastructure network connecting all sub-regions in Asia, and between Asia, Europe and Africa.

At the same time, China and countries along the way are making efforts to promote green and low-carbon infrastructure construction and operation management, taking into full account the impact of climate change on any construction.

With regard to transport infrastructure construction, they are focusing on key passageways, junctions and projects, and giving priority to linking up unconnected road sections, removing transport bottlenecks, advancing road safety facilities and traffic management facilities and equipment, and improving road network connectivity.

Countries along the Belt and Road are building a unified coordination mechanism for whole-course transportation, increasing connectivity in customs clearance, reloading and multimodal transport, and gradually formulating compatible and standard transport rules, in order to facilitate international transport.

China suggests pushing forward port infrastructure construction, building smooth land-water transportation channels, and advancing port cooperation, increasing sea routes and the number of voyages, and enhancing information technology cooperation in maritime logistics. We should expand and build platforms and mechanisms for comprehensive civil aviation cooperation, and quicken our pace in improving aviation infrastructure.

In this episode, we will see how Belt and Road helps close the distance between people around the world.

The Belt and Road:

http://watchthis.chinadaily.com.cn/video/column/belt-and-road/

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Belt-road changes world order


Illuminated boards highlighting Xi’s signature One Belt- One Road foreign policy plan in Beijing. Leaders of 28 countries are set to attend the summit in the Chinese capital next month to discuss the infrastructure investment programme to stitch together the Eurasian continent. — AP‘Win-win development will lie at the core of the forum. The Belt and Road has become the most important public good China has provided to the world. It was first proposed by China, but now it is for all countries to enjoy.’ – Wang Yi.  ‘Belt and Road has the power and prestige of President Xi Jinping behind it. It is the centre of his vision for China, and of his ambition to transform China’s place in the world during his time as its leader … And already it is starting to change the geoeconomic and the geopolical landscape.’ – Huge White

 

China’s ambitious economic plan is set to draw up a new global paradigm with countries seeking to engage the Middle Kingdom.

WHEN the ambitious Belt and Road initiative – with projects reportedly worth US$1 trillion – was first announced by President Xi Jinping in the autumn of 2013, many were sceptical of this Chinese move aimed at building up economic connectivity of 65 nations (China plus 64) along its ancient silk road and maritime routes.

For China, this New Silk Road would also serve to redirect the country’s domestic overcapacity and capital for regional infrastructure development to improve trade and ties with Asean, Central Asian and European countries.

Unprecedented in terms of China’s financial commitment, many Western critics have viewed this strategy as a grandiose foreign policy to expand Beijing’s influence to poor nations hungry for economic and infrastructure development.

The initiative was mooted at a time when the United States and the West excluded China from regional trading blocs. Hence, Beijing’s new development vision has been read as a strategy for asserting its leadership role in Asia and beyond.

But after nearly four years of promoting the concept and implementing projects, this initiative – dubbed as a modern-day Marshall Plan – is gaining traction.

It is seen by some Western academics as posing a threat to the US-centric world trade order and economic model.

Without a doubt, China is heading towards achieving its regional economic and diplomatic objectives. And the internationalisation of the renminbi is being boosted.

“We expect the One Belt-One Road (OBOR) to support long-term growth of development in the economies involved, particularly in some of the least developed parts of the world… We also expect it to help boost China’s global influence,” says a report dated April 27 by Oxford Economics.

While the idea of enhancing connectivity has drawn interest, the worry on China’s potential hegemonic ambitions has prevailed among regional rivals India and Japan, as well as the United States.

Despite this, nations that correctly read China’s economic strategy and Xi’s resolve were quick to announce their support for this China-led inclusiveness. And Malaysia had become one of the earliest participants and is now a gainer.

The Belt and Road initiative is largely assessed as having progressed well despite some setbacks.

Many countries are at ease to engage with China, particularly after Xi declared the “Three Nos”: no interference in the internal affairs of other nations; no intention to increase the so-called “sphere of influence”; and no motive to strive for hegemony.

Recipient nations are enjoying higher economic, trade and business activities, as well as a tourism boom helped by the influx of tourists from China – the world’s second largest economy and biggest consumer market.

The impact of the Chinese strategy is particularly conspicuous in the least developed nations in Africa and West Asia, as well as Asean nations such as Laos, Vietnam, Indonesia, Cambodia and Malaysia.

“Many belt-road countries have for many years been neglected by the West and Western investors, so even though there are concerns, some countries see China as offering once-in-a-lifetime chance to get out of poverty and under-development,” observes Dr Ngeow Chow Bing, deputy director of Institute of China Studies, Universiti Malaya.

China says it has invested more than US$50bil (RM220bil) on belt-road projects over the past three years, and signed project contracts worth US$926bil (RM4.16 trillion) covering mainly railway networks, highways and ports.

But China and its construction companies have also benefited from these endeavours. Its economy has been stimulated by exports from industries with overcapacity such as steel, cement and aluminium. Its GDP growth of 6.9% in the first quarter of 2017 was higher than expected.

Significantly, China’s state-owned construction conglomerates have successfully ventured out into belt-road nations. With these giants leading the build-transfer-operate schemes, smaller private enterprises have followed suit.

With China’s infrastructure projects and industrial investments extended to over 60 nations, the belt-road strategy is challenging the US-led world order and a new economic paradigm is definitely emerging, according to analysts.

Teoh: ‘OBOR will reshape the world’s economic dynamics
  “OBOR will significantly reshape the world’s economic dynamics. It will sharply increase accessibility and trades, across over 65% of the world’s population and 25% of global trade and services,” says Teoh Kok Lin, founder and chief investment officer of Singular Asset Management, a Kuala Lumpur-based regional asset investment company.

“Emerging economies, in particular, will benefit most from the increased global trades and services as well as improved infrastructure. OBOR will expand trade globalisation at a time when the world is worried about the Trump administration push towards the Buy America policy,” adds Teoh.

Closer economic relations with Beijing has helped reduce regional tension and friction, as seen in the case of the South China Sea where the Philippines under its current president saw economic cooperation with China as more practical.

Despite concerns over China’s rapid reclamation of reefs in South China Sea, in which Manila and several Asean nations have contesting territorial claims with China, the Asean Summit is unlikely to kick up a storm.

According to Reuters, Philippine President Rodrigo Duterte said on Thursday “it is pointless” discussing Beijing’s contentious activities in the South China Sea at this summit, and “no one dared to pressure China anyway.”

Referring to the Belt and Road initiative as “a brilliant plan”, CLSA in its report remarks: “Xi Jinping’s ambitious strategic initiative – an adaptation of the historical Silk Road – marks the beginning of a new geopolitical era.”


May 14-15 summit and forum

The major achievements of the belt and road initiative are expected to be further highlighted at the coming two-day Belt and Road Forum for International Cooperation, which will be opened by President Xi on May 14 in Beijing.

This summit could be the most important diplomatic event this year to discuss what is expected to be the largest global economic programme.

“Amid challenges and the perceived fear of China’s influence of regional geopolitical landscape, China’s OBOR initiative has achieved commendable progress since 2013,” says Datuk Ter Leong Yap, president of the Associated Chinese Chamber of Commerce and Industry of Malaysia.

“China has made significant headway by kick-starting infrastructure and connectivity projects to facilitate trade and investment, promote financial cooperation as well as deepening cross border flow,” he adds.

Since 2013, China’s businessmen have built 56 economic and trade cooperation zones in belt-road countries, generating nearly US$1.1bil (RM4.7bil) in tax revenue and creating 180,000 jobs, according to Xinhua.

Large-scale infrastructure projects – along with funding – have led to a boom of economic activity in countries like Kazakhstan, Azerbaijan, Georgia, Belarus, and Poland.

And in Asean, rail and ports projects are either being constructed or planned. These include the China-Laos Railway, Jakarta–Bandung High Speed Rail, Malaysia’s East Coast Rail Link and a high-speed rail project in Thailand.

And Eurasia, the vast landmass from China to Europe, is being interconnected into a massive market via high-speed China-Europe, trans-Eurasian direct trains.

These modern freight rail systems, which have replaced the silk-laden camels of the Han Dynasty, could transport goods at lower costs and more efficiently from China to European cities (and vise versa), compared to shipping.

In sum, China’s overland belt-road projects have achieved the objective of building a trans-national network connecting Asia with Europe and Africa, and promoting economic development in participating countries.

And it looks like the current objective and scope will be widened to embrace nations outside the belt-road routes.

“China is upbeat about the initiative in boosting mutual development and is willing to channel more energy into it,” declared Chinese Foreign Minister Wang Yi on April 21, when he briefed the media on the coming summit and forum.

“Win-win development will lie at the core of the forum. The Belt and Road has become the most important public good China has provided to the world. It was first proposed by China, but now it is for all countries to enjoy,” Wang said.

A total of 28 heads of state and government – including Russian President Vladimir Putin, Turkish President Recep Tayyip Erdogan and Malaysian Prime Minister Datuk Seri Najib Tun Razak – have confirmed they will be attending the May 15 summit.

UN secretary-general Antonio Guterres, World Bank president Jim Yong Kim and International Monetary Fund managing director Christine Lagarde will also be present.

Over 80 leaders from international organisations, 100 ministerial-level officials, as well as 1,200 delegates from various countries will be there, too.

President Xi will deliver a keynote speech, as well as host a roundtable meeting to brainstorm on policy and strategic development and interconnected development in the world.

There will be another high-level meeting to discuss infrastructure, trade and economic cooperation, energy resources, financial cooperation, eco-environment, and people-to-people exchanges.

According to Wang, China expects to sign agreements with around 20 countries and 20 organisations at the event to turn the grand blueprint into a workable road map, and to push for the delivery of joint projects under earlier MOUs.

He clarified that China has no intention of drawing geographical boundaries to areas covered by the initiative.

“As long as the spirit of the Belt and Road is recognised… everyone can enjoy its opportunities,” he said.

Japan sprang a surprise last week when Toshihiro Nikai, the secretary-general of the ruling Liberal Democratic Party, said he would attend the New Silk Road summit.

“Given the international situation starting with North Korea, mutual understanding between Japan and China is vital,” he was quoted by Jiji News Agency as saying.

What lies ahead in 2017?

Over the past two years, China had generated huge momentum for its New Silk Road initiative by signing many MOUs on infrastructure projects with belt-road countries.

Chinese firms, mainly state-owned or controlled, had reportedly signed investment deals worth US$171bil (RM742bil). Among these was the US$46bil (RM200bil) China-Pakistan economic corridor.

The government of Xi is expected to start making good on these projects this year and help facilitate their financing and implementation.

Nearer home, the financing and construction of Malaysia’s RM55bil East Coast Rail Link is expected to start this year. The rail project is set to spur economic activities in the east coast states of the peninsula.

Wake Shepard, a China watcher and writer, expects increased economic participation from Europe.

“Beyond the further development of key trans-Eurasian logistics hubs on the Poland/Belarus border and a port in Greece, look for more high-end European products going overland by rail to China,” he wrote on Forbes.com.

Many Europe-based logistics giants have been promoting Europe-China rail transport in 2016, and in 2017 they should see results from these efforts, he added.

“European freight forwarders, manufacturers and policy makers are now waking up to the fact that these newly enhanced trade corridors are providing ample opportunity to get more of their high-value products to the booming markets of China and the rest of Asia,” says Shepard.

For China, the forum may be a good platform for it to listen to views on why some ventures did not progress well, such as its port-city investment in Sri Lanka.

Complaints that Chinese firms have posed unhealthy competition and threaten to wipe out small businesses of belt-road countries could also be on the table for deliberation.

The Middle Kingdom may also have to assess whether it is worthwhile to take risks in countries clouded by security issues, political instability and racial conflicts.

Belt road implications

The importance China has attached to the Belt and Road summit and forum goes to show how vital this international economic inclusive programme is to China and Xi.

It is imperative for Xi, who took over the presidency in late 2012, to show his ability to transform China into a global, influential leader.

After three decades of rapid growth, China needs to seek new investment and trade opportunities beyond its borders and the belt-road initiative mooted by Xi is addressing this predicament.

The infrastructure projects China build in belt-road countries will help absorb a significant portion of the country’s overcapacity, and counter its economic slowdown.

As western China has often been troubled by tension between the financially-weak Uighur Muslims and China’s Han majority in Xinjiang Province, economic development in this old silk road region may pacify the Uighurs and reduce ethnic conflicts.

But Hugh White, professor of strategic studies at the Australian National University in Canberra, sees China as having much bigger ambitions.

“China wants to consolidate its position at the centre of the global supply and manufacturing networks which will be the key to the global economy over the coming decades,” he wrote in a recent comment.

The initiative will also help China to realise its ambition to become a middle-income country and reinforce its parallel ambition to take the lead over the coming decades in developing key technologies and setting global standards – including for high-speed rail and data networks, he added.

He opined the Belt and Road Initiative could not be dismissed as a mere dream.

“It has the power and prestige of President Xi Jinping behind it. It is at the centre of his vision for China, and of his ambition to transform China’s place in the world during his time as its leader. And already it is starting to change the geo-economic and geopolitical landscape.”

“If America and its allies are determined to resist China’s challenge to the old US-led liberal global order, they have to counter Beijing’s powerful vision. And to do that they need an equally powerful and ambitious global economic vision.”

Source: by Ho Wah Foon The Star/ANN

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https://www.youtube-nocookie.com/embed/dOrQOyAPUi4

Western dominance on the global stage is coming to an end – we are now entering the era of Chinese influence

China’s economic relations with the Middle East are on a long-term upward trend. Beijing is the region’s largest foreign business partner, now surpassing the US in oil purchases. In the five years leading up to 2009 trade tripled, reaching $115bn

Donald Trump’s inauguration has been described as symbolising the end of the “American Century”. Historians may look back on 2016-17 as the years in which the two greatest forces sweeping the world – the anti-establishment backlash in the West, and the resurgence of Asia – combined to thrust China into a global leadership role. This was seen at Davos, in Beijing’s recent foray into the world’s most contentious conflict – Israel-Palestine – and most recently in Theresa May’s statement that the US and UK will never again invade sovereign countries to “remake the world in their own image”. This suggests that it might not be just a century of American dominance that’s ending, but half a millennia of Western pre-eminence.

President Xi Jinping’s call for the establishment of a Palestinian state with East Jerusalem as its capital occurred just as the Trump White House began early talks over moving America’s embassy in Israel to the disputed city. This is part of China’s conversion of economic weight into diplomatic and geopolitical assertiveness in the Middle East over the last few years.

China’s economic relations with the region are on a long-term upward trend. Beijing is the region’s largest foreign business partner, now surpassing the US in oil purchases. In the five years leading up to 2009 trade tripled, reaching $115bn.

China has begun translating this into strategic influence. In 2008-2009, Beijing sent naval vessels to the region, an action referred to as its “biggest naval expedition since the 15th century”. China has embarked on strategic partnerships with traditional US allies like Saudi Arabia and Qatar. In addition to Saudi Arabia traditionally being China’s top source of oil, Beijing has convinced Riyadh to engage its “One Belt, One Road” initiative and attracted it to join the Asian Infrastructure Investment Bank. In 2016, the two countries unveiled a five-year plan for Saudi Arabia-China security cooperation. Riyadh also expressed interest in Chinese defence technology.

China’s growing footprint is in part possible due to some of the forces that brought President Trump and Prime Minister May to power. Firstly, Western publics are beyond fatigued by over a decade of war and intervention in the Middle East – much of which was supported by the same Republicans within Washington’s foreign policy establishment that had declared they wouldn’t work with Trump, and the same Labour MPs who sought to overthrow Jeremy Corbyn. Despite Trump’s tough-on-terror talk, the public gravitated to the same anti-regime change positions that were popular with Bernie Sanders supporters. May herself has observed this mood and adjusted her position accordingly. This is combined with a reduction of the US and Britain’s relative power in the region.

Additionally, Washington is less dependent on energy from the region. This is combined with Middle Eastern states themselves reaching out to diversify their strategic partnerships in an increasingly multipolar world. This includes US allies like the Gulf States, as well as those who feel threatened by the West, like Iran.

Beijing’s Trump Cards

China has several advantages in the region. Firstly, Beijing mirrors Western public opinion by taking a non-interventionist approach to issues like democracy and human rights. This of course sits well with rulers in the Middle East. China has asserted its view that Middle Eastern countries and their people should be able to decide their own path to development in accordance with “national conditions”. In the past, President Xi has expressed China’s support for Saudi Arabia choosing its own development path. In Qatar, Beijing differentiated itself from the West, pledging to support Doha on issues of national independence, sovereignty, stability, security and territorial integrity. This was received well during a visit to Beijing by Qatar’s Emir who reportedly voiced his “appreciation for China’s impartial stand on international affairs”.

Secondly, unlike the US, China is not bound by well-known and entrenched alliances and animosities. It is obvious who the US supports in the Middle East and who its rivals are. With Beijing there is more flexibility. Shrewd foreign policy advisors in Beijing will be advising President Xi to use China’s burgeoning ties with the Gulf States and Israel to leverage relations with Iran and vice versa.

For instance, China has held positions on Syria and Libya inimical to those of its new partners in the Gulf. In addition to Damascus being a long-time buyer of weapons from China, Beijing has also made clear its support for Moscow’s intervention. China and Russia have consistently worked together to provide diplomatic protection to the Syrian government via vetoes at the UN. Some sources also reported Chinese military advisers being dispatched to Syria and Beijing providing training support to the Syrian army.

While maintaining its tendency to take a soft-spoken approach, Beijing hosted both senior Assad government and opposition figures. In a purposely symbolic move, during the China visit, the Syrian Foreign Minister confirmed the government’s willingness to participate in the peace process. Beyond Middle Eastern states, China’s position on Syria provides it negotiating power with both the West and Russia. Similarly, Beijing’s Palestine announcement allows it to extract more from Israel.

China’s Interests

China primarily sees the region as a source of energy. It is also a continuation of the trade routes it seeks to secure from East Asia, through the Indian Ocean, to the Middle East, Africa and Europe.

The ability to influence the Middle East is also important to great/rising powers like America, China and India in order to disrupt and deny energy to potential adversaries. Greater Chinese involvement will give Beijing some potential leverage over the energy supplies of adversaries like Japan, and potential competitors like India. Beijing’s pursuit of closer ties with Middle Eastern states as part of its “Maritime Silk Road” initiative adds to India’s fears of encirclement by a Chinese “string of pearls”.

Beijing also prioritises stability in the region more consistently than Washington. Recent conflicts cost China. The toppling of Gaddafi in Libya led to losses in energy investments, infrastructure and equipment, as well as evacuation costs. With regard to Syria, Beijing had to abandon its oil investments in 2013 due to the war.

As one of the main theatres for geopolitical competition between great powers, China’s growing strategic role in the Middle East is another step toward what many in the country see as its own “manifest destiny”. This rising Asian power, free of colonial baggage in the region, adds a new ingredient that could help untangle seemingly intractable issues like Israel-Palestine. Furthermore, with its steadfast principle of respecting sovereignty, China’s increasingly loud and distinctive voice in the Middle East may indeed be the final nail in the coffin of Western interventionism.

Sources: Dr Kadira Pethiyagoda is a visiting fellow with the Brookings Institution researching Asia-Middle East relations – independent.co.uk

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China need not always win to be great


While it deserves to have a greater say in the world order, it should not be the only big winner. In its rush to assert itself on the global stage, it has simply reaped acquiescence

 

Chinese soldiers marking the Communist Party’s 95th anniversary in Heilongjiang province last month. In President Xi’s address, he said China will never compromise on its sovereignty. Standing up forcefully on the world stage has become a cornerstone of the country’s diplomacy. PHOTO: AGENCE-FRANCE PRESSE

BEIJING • In his address at the 95th anniversary of the Chinese Communist Party (CCP) this month, President Xi Jinping (pic) devoted an unusually lengthy part of his speech to foreign policy.

Speaking just days before a ruling by the Arbitral Tribunal at The Hague on China’s claims in the South China Sea, most international media focused on him saying that China will never compromise on its sovereignty. The Chinese media, however, picked out certain phrases to highlight his vision for the country on the global stage.

One of them is “ren lei ming yun gong tong ti”, or a “community of common destiny for mankind”, a term Mr Xi has used at least 60 times since 2013.

Building this community is the “Chinese solution” for an international world order that emphasises mutual benefits, and will allow China to fulfil its responsibilities as a major country, said party mouthpiece People’s Daily in a commentary on Monday.

Another Chinese media analysis said China has come up with the “Chinese solution”, or “zhong guo fang an”, because it no longer wants to follow Western rules now that it has “a major country’s capabilities and self-confidence”.

Taken together, these points summarise China’s reimagining of its role as a “major country/great power” or “da guo” in recent years.

Although it became the world’s No. 2 economy in 2010, the Chinese have always debated whether their country is truly a great power. There is, however, little doubt in the mind of Mr Xi, who has more actively sought to answer the question: “So what should a great power do?”

Plenty, it seems. In recent years, standing up more forcefully on the world stage has become a corner- stone of the country’s diplomacy.

Last September, the People’s Liberation Army (PLA) carried out a rare and massive display of its latest hardware through Tiananmen Square in a show of military prowess that unnerved neighbours in the region and countries further afield. That came amid a PLA restructuring and personnel reshuffle meant to improve its combat capabilities, as well as weapons deployment and land reclamation in the South China Sea.

Then last month, at a special meeting in Kunming between Asean and China’s foreign ministers, a planned joint press conference failed to take place after the Chinese applied pressure on a few Asean member states and caused the 10-member bloc to splinter over a proposed joint statement on the South China Sea.

Experts such as Nankai University analyst Liu Feng have pointed out that “China has been more inclined in recent years to use its coercive power to persuade neighbouring countries or to ensure that they indeed treat it with respect”. That is consistent with the observation that China has modified its foreign policy strategy to become more pro-active, shifting from the decades-old mantra of “tao guang yang hui” (keeping a low profile) to “fen fa you wei” (striving for achievement), a term Mr Xi used at a high-level diplomatic work conference in 2013.

Yet, what a great power can do and what it should do are different things – and both China’s leaders and its people seem increasingly interested only in the former while “striving for achievement”. That attitude extends to the Chinese public, as can be seen in the response of a fisherman from Hainan province who said in an interview in May: “Just attack them…, what are we afraid of?”

He was referring to the Philippines, which the tribunal ruled in favour of this week in the former’s disputes with China in the South China Sea. Many of these fishermen had clashed with the coast guard and fishermen from the Philippines during their expeditions to the Spratlys, which the Chinese government encourages as a way of safeguarding sovereignty.

It is not uncommon to see netizens comment on territorial disputes online with a single word “da” (attack), born from the angst of seeing “great power” China supposedly being pushed around by smaller countries. They feel that China’s might is not limited to the military either, often questioning what would happen if China decides to cut off trade ties or investment with another belligerent country. In short, now that we are strong, why do we need to play nice?

Yet, when it suits its cause, China (or its public) is quick to highlight that it is also a “rising power” – a developing country – hence relieving it of the international responsibilities that most expect a great power to shoulder.

Indeed, when Mr Xi committed US$2 billion (S$2.7 billion) last September to a development fund for poor countries and said China would aim to increase investment in least-developed countries to US$12 billion by 2030, that effort to change China’s image as an international “free rider” swiftly came under fire. Why is China not helping its own poor, many Chinese asked. China is just a big country, not a rich country, others said.

None of that helps China’s standing on the global stage. In its rush to demand respect befitting of a great power, China has merely reaped acquiescence.

Just looking at Asean, for instance, closer economic cooperation with Beijing has failed to translate into mutual trust. If anything, it has been the opposite, with concerns growing about China’s readiness to wield its economic clout for geopolitical benefits. As one Western scholar observed, “China is a great power, but it doesn’t realise that being a great power doesn’t mean you need to ensure you win all the time”.

This is where China can perhaps heed a lesson it learnt from the remarkable feat it pulled off early this year, in opening the Asian Infrastructure Investment Bank (AIIB), which People’s Daily also sees as part of the “Chinese solution”. Few would have given it a chance when Mr Xi first mooted it in 2013, especially given the intense pressure that the United States had put on other countries not to join the bank. But the benefits of this new institution were apparent to the 57 that eventually signed up, in what became a major public relations coup for China.

No coercive action was needed when the countries could assess for themselves the AIIB’s merits, while being keenly aware of the limitations and associated biases in current international financial institutions.Two weeks on from Mr Xi’s address, the tribunal has ruled against China’s claims in the South China Sea and all eyes are on how forcefully it reacts. It should keep in mind that in recent years, assertive action has only served to push China’s neighbors further away from it. It is still questionable, on balance, how much “striving for achievement” and not following “Western rules” has gained for China, and if that is still a path worth going down.

China deserves to have a greater say in the world order and, as it has pointed out, there should be no objection to its attempts to build a new world order that emphasizes “mutual benefits and a non-zero sum game model”. In such a world, however, the great power should not be the only big winner.

By Teo Cheng Wee, China Correspondent The Straits Times/Asia News Network

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Xi-Ma meeting in Singapore is for the next generation, deserves the world’s applause



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Chinese mainland authorities announced Wednesday that Chinese President Xi Jinping and Taiwanese leader Ma Ying-jeou will meet in Singapore on Saturday to exchanges views on peaceful development across the Straits. The Xi-Ma meeting is a major breakthrough in relations between Taiwan and the mainland. It will exert a positive influence on the island’s future policy toward the mainland and lay a firm foundation for the way the world perceives this relationship.

Since the Wang-Koo meeting in 1993, the level of meetings between leaders from the two sides has been getting higher, but no breakthrough has been made yet, mainly because it is difficult to define their identities and titles. Taiwan has hoped to identify its leaders as “president,” to which the mainland cannot agree since this is not only a matter of identity, but of the nature of mainland-Taiwan relations.

According to Zhang Zhijun, head of the Taiwan Affairs Office of the State Council, Xi and Ma will meet as the “leaders” of both sides upon negotiations in line with the one-China principle when political differences between the two sides remain.

Xi and Ma will call each other “Mister,” which will be a unique phenomenon in top meetings.

This practical arrangement will create space for both sides to seek a solution in future. The Taiwan question can generally go into three directions – maintaining the status quo, stepping into unification, or realizing so-called “Taiwan Independence.”

It is unlikely that the cross-Straits relationship will maintain its current exact status quo as it is changing all the time. “Taiwan independence” has been driven by interior extreme forces. Meanwhile, the counter thrusts include the mainland’s increasingly powerful clout and the positive mainstream forces from Taiwan itself. The world is also anticipating closer cross-Straits ties. These forces shape the big picture of closer cross-Straits relations.

Xi’s political appeal has impressed both sides of the Straits and the whole world. The long anticipated meeting will be finally realized in his first-term. His appeal is essential for taking key steps to realize the great rejuvenation of the Chinese nation.

Ma deserves warm applause for his willingness to have the meeting. With seven months left in office, during his term the 1992 Consensus has been well upheld and cross-Straits cooperation prospers. Despite his controversial governance of Taiwan, the positive factors of cross-Straits ties may have a longer influence on Taiwan’s future path than Ma’s term.

The opposition camp in Taiwan has made immediate objections, hoping to control public opinion. But they should be aware that the historic meeting is supported by the whole world, including the US, and they are displaying jiggery-pokery from a small circle. Such extremism is bound to be stigmatized.

The Xi-Ma meeting has excited Chinese people worldwide. International society is also interested in seeing the two sides taking a pragmatic step forward. Applause will be heard globally for the victory of peace and rationality. – Global Times

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