Academics have discussed the possibilities and pitfalls of China’s Belt and Road Initiative.
ICTSD and IIED explore trends in and implications of China’s investments in Africa, while Impakter examines a “trade-down” versus “grassroots-up” approach to SDG implementation, with a focus on agriculture.
Brookings compares the US market-driven approach in Africa to that of China’s state-led model.
With tensions high in the global community around trade policies and international relations, this week’s brief reviews some of the differences in countries’ approaches to investment abroad. Following recent headlines, it examines China’s Belt and Road Initiative (BRI), in tandem with cooperation in Africa, highlighting the implications for sustainable development on the continent.
Announced in 2013 with the promise of providing a “silk road for the 21st century,” the BRI consists primarily of state- and privately-financed infrastructure projects in developing countries. The Initiative has been met with both praise and skepticism.
In the Financial Times, Beijing Foreign Studies University’s Gu Bin says, the “spirit of the BRI reinforces the value of building a shared future,” highlighting key differences that distinguish it from the post-World War II Marshall Plan led by the US. However, Sean Kenji Starrs, City University of Hong Kong, responds by noting the BRI is “no selfless venture.” He cites debt, other aspects of neocolonialism and increasing homogeneity of Chinese academia as causes for concern (though these points are also contested).
The International Centre for Trade and Sustainable Development’s (ICTSD) July publication of Bridges Africa zooms in on China-Africa economic relations. The introductory article flags that some have questioned the “balance and quality” of the relationship from an African perspective, given China’s high and immediate demand for natural resources. It also notes recent data that show decreases since 2013-2014 in Chinese investment in Africa, China-Africa trade, and Chinese loans to Africa. However, Yunnan Chen identifies opportunities for promoting sustainable development, emphasizing not only renewable energy and transportation projects, but also the scope for technology transfer and diversification of sourcing.
The International Institute for Environment and Development’s (IIED) James Mayers examines the complex impact of Chinese investment in Africa, linking particularly to SDG 15 (life on land), in a “long read” titled, ‘Finding a Green Path for China and Africa?’. Some investments, Mayers says, “gobble up forest and woodland. Some bring huge benefits to African economies. Some do both.” The article offers an overview of the BRI and provides insight to a topic that often features perceptions that have been “assumed rather than really known.” Mayers identifies context-specific constraints to more sustainable timber production and processing, particularly in small-scale operations that “have traditionally worked under the radar of policy and legality.” A key gap, he notes, is connecting businesses to the remote areas and people where their investments often materialize, and breaking down stereotypes or prejudices across stakeholder groups.
IIED also produced a short film on the linkages between Chinese investment in Africa and the continent’s forests, which it emphasizes are increasingly being converted to agriculture or sent to China – the world’s “only reliable market” in the eyes of one interviewee. Darlindo Pechisso, National Directorate of Forests, Mozambique, notes that 90% of the country’s timber is exported to China. The article and film are part of a wider project supported by the UK on China-Africa Forest Governance.
Looking at trade more broadly through an agricultural lens, the fourth in a series of articles on Impakter asks whether achieving the SDGs is a “grassroots-up” or “global trade-down” endeavor. The article notes that at the local level, 45 million small farms in Africa produce the bulk of countries’ agricultural exports, and that trade links these smallholders to global food value chains. The authors, from the Food and Agricultural Organization of the UN (FAO), also highlight large agribusinesses and multinationals, which they indicate as having a leading role, but will have to “substantially change” their business to contribute to the SDGs and minimize the negative impacts of their operations. A Devex Q&A on support to African entrepreneurs also notes the potential for agriculture and trade in Africa.
Following the recent BRICS Summit in South Africa, China’s President Xi Jinping signed a number of cooperation documents on the continent. An opinion piece on China Global Television Network (CGTN) by China’s ambassador to Somalia, Qin Jian, calls the BRI “win-win cooperation,” noting that the BRI “reaffirms China’s commitment to building an open economy, ensures free and inclusive trade, opposes all forms of protectionism.” Qin also says the BRI stands for enhancing international cooperation through strategies that feature the SDGs and African Union’s Agenda 2063.
The Brookings Institution’s Yun Sun compares China’s state-led approach in Africa to that of the US, which is “more willing to let companies and the market” lead commercial development. She notes that while US-China cooperation around Africa’s development has been “scarce,” there is increasing collaboration between Chinese and American companies, the latter of which appear to be beneficiaries of the BRI. General Electric (GE), she highlights, has worked in partnership with the state-owned Power Construction Corporation of China (Power China) on an expanded engineering, procurement and construction (EPC) project model. Under such a model, partners work together on joint market development, fundraising and operation. However, the article closes by cautioning that BRI projects are “designed to absorb Chinese overcapacity,” noting that most foreign firms remain at a disadvantage in competing for them. Whether these projects are aligned with the ambitions of the SDGs is yet to be seen.
Implementing the SDGs requires financial flows to, at a minimum, remain consistent. The BRI represents a significant source of funding that can begin to bridge the well-documented finance gap. However, in the broader context of a trade war and retaliatory measures or increasing national self-interest, reductions in investment or the continuation of a business-as-usual approach risks leaving the environmental and social pillars of international development unaccounted for.
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