The Comeuppance

XI JINPING’S conviction that it was no longer necessary to hide China’s strength and bide its time has boomeranged. Nothing illustrates the new era of uncertainty—for Beijing—better than the predicament of the Belt and Road Initiative (BRI) that Xi had envisioned as bigger than America’s Marshall Plan that resurrected a war-devastated Europe. More than 150 countries had signed up for BRI but at their Shanghai meet in October 2023—a decade after Xi’s speech in Kazakhstan when he pledged $1 trillion (or perhaps $8 trillion) to building roads, railways, bridges, ports, etc across a wide swathe of the world— it was obvious that BRI was not a new Marshall Plan.

“China had not been providing… aid and expertise. It was all about loans that sooner or later would have to be repaid [at exorbitant rates]. China’s promises of prosperity… brought debt and distress to countries such as Laos, Sri Lanka and Pakistan. Portugal and Italy had decided to leave the BRI altogether and had begun to reassess their overall relationship with China,” writes Swedish journalist and veteran Asia watcher Bertil Lintner is his new book The End of the Chinese Century? How Xi Jinping Lost the Belt and Road Initiative. For India, geopolitics and economics had both made BRI unviable. A few weeks ago, Brazil became the second BRICS nation to decide against joining BRI. And China’s friend Russia’s invasion of Ukraine killed off BRI’s last hopes in Europe. The Chinese century seems to have ended before it had begun.

The countries supposed to benefit from BRI are not only unable to repay the loans forced upon them by Chinese banks, but they are also caught in a debt-trap situation being leveraged by Beijing to acquire political influence in those states and grab strategic assets, such as Hambantota in Sri Lanka. At the same time, “loans that cannot be repaid mean billions of dollars have been flowing out of China. Much of that money is not coming back.” Equity and assets gained as a result cannot really compensate for the loss of that hard currency. What couldn’t have come at a worse time is the fact that the post-pandemic Chinese economy never really recovered and its real estate sector is leading that downward spiral into an even more severe crisis.

There are two major reasons BRI bombed and had to be scaled down. One is that “there is no central [Chinese] governmental body that oversees the projects” and in the competitive frenzy within China, little attention is paid to homework and practicalities. This lack of proper planning translates into empty and/or unfinished ports and airports in the middle of nowhere where nobody comes, or stadiums taken over by nature even before they are completed. But that’s not unexpected from a top-down economic model where everything was built on speculation, such as homes for 3 billion with a population of 1.4 billion.

China has had more success with the Pacific Island Nations than in Africa or Latin America where public anger at Beijing’s extractive neo-colonisation runs high. But even in the Pacific, the guarantee on ‘investment’ is low. Ultimately, BRI was always about geopolitics and China’s impatience to take over as the sole superpower. While its military rise hasn’t slowed, Beijing is not getting a free hand in the Indo-Pacific as its encirclement from Japan to Diego Garcia shows, with the Quad and AUKUS, along with France, reserving the potential of a chokehold on the Malacca Strait. BRI, thus, hasn’t dispelled China’s curse of geography.

Lintner, whose China’s India War (2018) critiqued Neville Maxwell’s 1970 thesis that India had started the 1962 war, is not a neutral observer and has a firm grasp on geopolitics—not least how the India-China confrontation on the roof of the world plays out. He is among those scholar-investigators increasingly busting the myth of the old ‘Silk Road’ that China concocted to promote its ‘New Silk Road’. Based on the map of a lie, perhaps BRI was morally doomed too.

Belt and Road InitiativeChinaconnectivityglobal infrastructuretransportXi Jinping