China’s New Global Strategy

The Belt and Road Initiative (BRI) and Asian Infrastructure Investment Bank (AIIB), Volume I

Suisheng Zhao

• Publisher: Routledge
• Year: 2020
• Print ISBN:
  9780367321499
• eBook ISBN:
  9781000103984
• Topic: Business
• Subtopic: Business General
• Index: Business

Rising as a global power and regarding the existing world order unjust and unreasonable enough to meet the interests of both itself and other emerging powers, China has demanded reform to global governance, and taken new initiatives using its new quotient of wealth and influence to draw countries into its orbit. This comprehensive volume focuses on the two most important of these initiatives: the Belt and Road Initiative (BRI), launched in 2013 to strengthen China's connectivity with a large part of the world through infrastructure and economic development; and the Asian Infrastructure Investment Bank (AIIB), created in 2015, which represented China's effort in the reconstruction of the international development rules. This book explores how these two initiatives are central to China's emerging global strategy.

The authors examine China's geopolitical and geo-economic motivations and domestic political dynamics in launching these two initiatives. They also investigate the responses from the major foreign partners involved in both initiatives. This book will be of great interest to students, academics and researchers of China's emerging global strategy. It comprises articles originally published in the Journal of Contemporary China.

1 Motivation behind China's ‘One Belt, One Road’ Initiatives and Establishment of the Asian Infrastructure Investment Bank

Hong Yu

ABSTRACT

The ‘One Belt, One Road’ (OBOR) initiatives form the centerpiece of the Chinese leadership’s new foreign policy. The OBOR initiatives are a reflection of China’s ascendance in the global arena, economically, politically, and strategically. Developing inter-connectivity of infrastructure development forms a central part of China’s OBOR initiatives. The Asian Infrastructure Investment Bank (AIIB) aims to facilitate and accelerate infrastructure improvement in the region by providing capital loans and technical services. The AIIB will serve as the spearhead of China’s OBOR initiatives. The AIIB and OBOR initiatives have put China at the center of geoeconomics and geopolitics in the region and beyond, a position from which it hopes to strengthen its economic ties with other Asian countries. The new Silk Road initiatives also provide a channel for Chinese companies and capital to invest in other countries by leveraging China’s strengths in infrastructure development, financial power and manufacturing capacity. The OBOR initiatives and the AIIB could change the economic and political landscape of Asia, the most dynamic and economically vibrant region of the twenty-first century. However, China faces serious challenges, both internally and externally, in implementing these initiatives.

China Unveils its ‘One Belt, One Road’ Initiatives

During Chinese President, Xi Jinping’s visit to Kazakhstan and Indonesia in October 2013, he outlined China’s ambitious plans for the so-called ‘Silk Road Economic Belt’ and ‘Maritime Silk Road of the Twenty-First Century’ respectively, contemporary versions of the centuries-old Silk Road trade routes. On land, the ‘Silk Road Economic Belt’ would mainly target Central Asia and Europe, while the Maritime Silk Road would mainly target Southeast, South and North Asia. These two initiatives were eventually combined into the ‘One Belt, One Road’ initiative (OBOR), with China as its hub.

This is to be a far-reaching strategy with regional and global implications for decades to come; as such it has attracted increasing interest among government officials, academia and the business community.

Since the announcement of the OBOR strategy the Chinese government has been conducting a charm offensive towards Asian and other countries along the historical Silk Road route, fully mobilizing its political, economic and diplomatic resources in order to forge a positive image of the New Silk Road strategy among the international community.

China’s OBOR initiatives are rooted in history and inspired by the historic Silk Road (丝绸之路), an extensive network of maritime and land routes for trade, communication and cultural exchanges that once linked China with the countries of Asia, Middle East, and Africa to Europe. It fell into disuse around the 1600s after a few glorious centuries. The Chinese authority describes Southeast Asia as an important commercial hub along the maritime Silk Road route, playing an indispensable role in expanding China’s external trade with the outside world. In the early fifteenth century, under the command of Admiral Zheng He, the Ming emperor dispatched a series of naval expeditions and treasure ships to foreign countries, reaching as far as the South China Sea, Indian Ocean and the African continent. ¹ Hence, the trade links between China and its neighboring littoral states in the region were established in ancient times. China is now keen for this historical Silk Road to be revived.

¹Daniel C Waugh, ‘The silk roads in history’, Expedition 52(3), (2011), pp. 9-22; Jeremy Page, “Chinese territorial strife hits archaeology,” The Wall Street Journal, 2 December 2013, accessed 19 February 2014, http://online.wsj.com/news/articles/SB10001424052702304470504579164873258159410 .

However, Zheng He’s main mission was not to promote trade and build friendly relations with countries and regions along the route, but instead to demonstrate China’s sea power and the formidable imperial rule of Emperor Yongle.² In fact, most of the maritime trade across the Silk Road routes was not initiated by the Chinese, and imperial China’s trade with the Southeast Asian littoral states was limited, as was its maritime prowess. The historian Wang Gungwu’s studies show that expansion of the Chinese empire had been consistently landwards and Chinese rulers were consistently passive about forging maritime contact with the outside world, despite sporadic maritime trade links with Southeast Asian ports during Emperor Yongle’s era. After his death, his successors showed little interest in maritime trade with the outside world. The Dutch and Portuguese played an important role in maritime trade with Southeast Asia along the Silk Road, whilst by the eighteenth century the British had started to play a dominant role in the maritime routes in the region.³

²Gungwu Wang, ‘China and South-East Asia 1402–1424’, in Studies in the Social History of China and South-East Asia, eds. Jerome Ch’en and Nicholas Tarling (Cambridge: Cambridge University Press, 1970), pp. 375-405.

³Gungwu Wang, ‘The China Seas: becoming an enlarged Mediterranean’, in The East Asian ‘Mediterranean: Maritime Crossroads of Culture, Commerce and Human Migration, ed. Angela Schottenhammer, (Wiesbaden: Harrassowitz Verlag, 2008), pp. 7–22. Gungwu Wang, ‘Southeast Asia: imperial themes’, New Zealand Journal of Asian Studies 11(1), (2009), pp. 36–48.

The Chinese government is eager to strengthen China’s political influence and promote closer economic integration with its neighboring Asian nations via improvement of physical inter-regional connectivity under the framework of the OBOR strategy. To support implementation of the OBOR strategy, China led the establishment of the Asian Infrastructure Investment Bank (AIIB). The AIIB and the new Silk Road initiatives demonstrate that China is now starting to take on a leadership role to reflect its position as a rising global power. The AIIB and OBOR initiatives have made China the center of geoeconomics and geopolitics in the region and beyond. China is a central actor both in the region and on the world’s economic and political stage. China’s rising geo-economic power means that it is now the largest trading and economic partner for most of the Asian countries.

Whilst geopolitics and geoeconomics are different concepts with different meanings, the two are closely interrelated. The concept of geopolitics is defined as ‘an old expression shaped by both academic and popular usages going back to imperial concerns with the links between geography, state t...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Contents
• Citation Information
• Notes on Contributors
• Introduction - The BRI and AIIB as China's New Global Strategy: Motivations, Domestic Politics and International Responses
• PART I Geopolitics and Geo-economic Motivations behind the BRI/AIIB
• PART II China's Domestic Politics and the BRI
• PART III Responses from Foreign Partners
• Index