Defence & Foreign Policy Opinion

Planning for a 1000-year empire in a changeable world: hits and misses of China’s Belt and Road Initiative

The Chinese government is known to value stability above everything. That goes for the Communist Party’s managing of the people in whose name it supposedly rules, but also for the way it approaches its near abroad.

They value predictable enemies as much as they appreciate loyal vassals. Shifting alliances and changing attitudes in countries, that is something that makes Beijing’s foreign policy establishment nervous.

18th_National_Congress_of_the_Communist_Party_of_China

File photo: Wikicommons.

Just as the central planners in charge of the economy are charged by the Party to think long term, so the foreign policy wonks are expected to plan for a Thousand Year Empire.

Apologists for China used to admire the long term visions of the people they regarded as meritocratic benevolent rulers. It was a good thing that China did not have to worry about election cycles. Yes, who needs that? Pesky people who throw out their rulers on a whim?

Unfortunately for China’s so-called meritocrats, some nations have election cycles. And, sometimes, the people that do not live under Socialism with Chinese Characteristics create an upset that shows the inherent weaknesses of China’s vaunted long term model.

A look at some of the less publicized hits and misses of the Belt and Road Initiative illustrates the point.

belt road

An exhibition billboard showing the Belt and Road Initiative. File photo: GovHK.

First, to understand Beijing’s view of the outside world, look no further than the 2016 Presidential elections in the United States. My Chinese friends, educated in the secular predestination theory of the historical dialectic, a fundamental article of faith in Marxism, have been told that in western democracies the candidate with the backing of the banking clan and the capitalist class always wins.

That was Mrs. Clinton. They were wrong. It turned out that Beijing did not even have a contingency plan ready in case Donald Trump won. The Trump upset may have resulted in one of the least publicized purges in modern Chinese Communist Party history, that of ‘experts of the American political system’.

Pity the poor middle-aged men, now planning wheat production in Jilin Province, who used to write memos about how to counter Mrs. Clinton’s hypocrisy regarding human rights. They have been replaced by fresh-faced graduates of one of China’s top universities who now have to come up with a strategy to counter a US President who cares not one wit about human rights.

Suddenly the leadership of the Communist Party of China is faced with a President who sees the world much as they do: the world is made up of powerful selfish interests and the way to deal with them is to cultivate a siege mentality and embrace transactionalism.

Donald Trump

Donald Trump. File photo: White House.

Although Vice President Pence has been charged with a more ideological pushback against China’s infrastructure building abroad, Donald Trump sees it as nothing else than a competing real estate guy building a bigger tower.

Malaysia

The Trump upset was just one of the changes in the foreign policy landscape that baffles Beijing. Another upset took place in May 2018, when the Malaysian people elected Mahathir Mohammed the job of Prime Minister at the age of 93. He ousted the incumbent Najib Razak, the candidate of a party that Mr. Mahathir himself had led from 1981 til 2003.

Mr Najib now faces charges over hundreds of millions of dollars that went missing from a state investment firm 1 Malaysia Development Berhad. One of the investigations into the missing 1MDB money looks into Chinese Belt and Road Initiative projects and whether they were awarded to fraudulently pave the way for a Chinese bailout of 1MDB.

The investigation focuses on the 20-billion-dollar East Coast Rail Link. This is supposed to connect the more populous and prosperous west coast of the country with the eastern seaboard and then run down the Malay peninsula.

Mr Mahathir was very critical of the project from the moment his predecessor announced it: “When it involves giving contracts to China, borrowing huge sums of money from China, and the contract goes to China, and China contractors prefer to use their own workers from China, use everything imported from China, even the payment is not made here, it’s made in China… that kind of contract is not something that I welcome”.

BRI planners in Beijing were aghast. This was one of the BRI’s biggest projects that they had safely planned to be up and running – and making a profit at least for China’s bankers if not for Malaysia, within a few years.

Mahathir Mohamad Mike Pompeo

Malaysian Prime Minister Tun Dr. Mahathir Mohamad meets with US Secretary of State Mike Pompeo meets at the Prime Minister’s Office in Putrajaya, Malaysia, on August 3, 2018. Photo: US State Department.

Since then Malay leaders have complained about Beijing’s pressure on the new administration. Beijing has threatened retaliation if the cancellation of the East Rail Link is final, such as ending or significantly decreasing imports of Malaysia’s palm oil.

China has also hinted at discouraging rich Chinese tourists from going to Malaysia, something South Koreans still remembers well after the brouhaha over THAAD missiles in 2017 – which ended after a newly elected South Korean President scrapped the plans, easing China’s fears. Sometimes an electoral surprise works out in China’s favour.

In the summer of 2018, Mr. Mahathir went to Beijing and his criticism of the Belt and Road projects was met with the stony faces that are job requirements for Chinese officials. Mr. Mahathir cancelled three Chinese pipelines and warned of a “new colonialism”.

Meanwhile, ethnically Chinese businesspeople in Malaysia have expressed fear that their favourable ties with China could be cut off if Mr. Mahathir cancels the big BRI project.

“Ethnic Chinese in South East Asia are treated by the Communist Party of China as the modern equivalent of how western European Communists were used by the Kremlin of old,” says Ming Boey, a scholar of overseas Chinese for the independent Singapore-based East Asian Peoples Institute.

Chinese authorities have prioritized efforts to cultivate support of the diaspora as well as all of its citizens who study and live abroad, which state media has collectively referred to as “overseas Chinese.” At a national work meeting on overseas Chinese held in February 2017, President Xi Jinping called for “closely uniting” with overseas Chinese in support of the Chinese dream.

Mr. Mahathir’s new coalition attracted a lot of votes from ethnic Chinese and this domestic constituency also makes breaking up with the Belt and Road difficult: “I want to be friendly with China. But I do not want to be beholden to China.” That may be a difficult balance to strike.

The Maldives

A few months after the electoral upset in Malaysia the people of the tiny island nation of the Maldives voted overwhelmingly for the opposition candidate, Ibrahim Mohamad Solih, booting out of office the increasingly autocratic Abdulla Yameen.

China was front and centre during the election campaign. Under Yameen the country had moved away from its traditional ally, India, and accepted Chinese loans and now infamous infrastructure projects. He also jailed his predecessor and judges who disagreed with him, making him not only beholden to China, but also increasingly Chinese in his attitude to rule.

One opposition poster showed a huge photograph of the Chinese President Xi Jinping with the text ‘President for Life, vote for Yameen’. By mocking Yameen as a puppet of China the opposition was making a point that the electorate did not miss, even though Yameen’s police forces quickly removed the posters in the same way Xi Jinping’s goons remove anything untoward from the Chinese Intranet.

In the end Yameen did not have the political acumen of his Socialist Overlord. Where Xi Jinping had crushed all opposition to his rule behind the red curtain of the Communist Party of China, the ‘wannaxi’ Yameen went on national television and declared that he would step down ‘as a servant of the people of the Maldives’, ending a few tense hours in the capital, Malé.

The new President was quick to reinstate jailed judges, call on India to restore ‘our old friendship’ and express concern over Chinese foreign policy “that is not always the win-win that Beijing tells us it is”.

At the new President’s inauguration, Prime Minister Narendra Modi represented India, while China was represented by Tourism Minister Luo Shugang, a powerful visual that the small island nation had resisted the pull of Beijing and was back with its natural ally.

Narendra Modi

Prime Minister of India Narendra Modi. File photo: GovUK.

Mr. Modi could not resist making a point when he said in an interview on Maldivian TV that “India will always support democratically elected leaders and will always treat them as partners, equal partners, with respect.” The Chinese Tourism Minister declined to be interviewed.

The new administration is not happy with the debt accrued to Beijing under Mr. Yameen. There has been widespread talk about corruption under the previous administration, which led to inflated contract prices and extravagant projected values.

Analysts have linked Beijing’s interest in the Maldives to its strategic location: a maritime territory almost double the size of France, adjoining the biggest shipping route between China and Europe. Here too, the BRI planners in Beijing did not expect the locals to make waves, that they would be as compliant as their own subjects usually are.

Myanmar

Meanwhile, in the birthplace of the expression “white elephant”, in what is now called Myanmar, China has been pushing the ruling National League for Democracy (NLD) government to allow the building of a controversial dam in the Irrawaddy River to resume.

During a visit to the region in late December last year, Hong Liang, China’s ambassador to Myanmar, told local political leaders that China was eager to move ahead with the hydropower dam and that it was needed to generate electricity to implement China’s Belt and Road building in Myanmar. Anyone who has travelled through Myanmar can attest that the country badly needs infrastructure, but the need for the proposed dam has not been proven to the locals.

Nevertheless, an ethnic Chinese business owner in the region, Yang Xiaodong, was quick to pick sides: “China is our most important neighbour. Nobody wishes to endanger our economic future.”

Mr. Yang turned out to be a prominent board member of a Beijing-friendly association that many in Myanmar believe to be a vehicle of the United Front Work Department, China’s Stalinesque organization for foreign influence operations, a department that Core Leader Xi Jinping has hailed as his Party’s “magic weapon” in dealing with pesky foreigners.

NLD spokesman Myo Nyunt said the government will weigh the pros and cons of the issue and announce its decisions publicly. “We should make a decision not based on emotions, but based on looking at the interests of the people and the country.” If those interests will be environmental, cultural or economic, he refused to say.

The 6,000-megawatt dam was put on hold by former Myanmar President Thein Sein amid protests over its enormous flooding area and detrimental environmental impact, as well as anger over the fact that most of its electricity would be exported to China and that the river is of huge cultural significance to the Kachin people who reside in the region.

These were all aspects ignored by Beijing’s BRI planners, they are, after all, things that they would not have to consider when planning infrastructure projects at home.

Aung San Suu Kyi.

Aung San Suu Kyi. Photo: Wikicommons/ Comune Parma.

Aung San Suu Kyi, who as opposition NLD leader at that time was one of the dam’s most vocal opponents, assured Beijing after the party won the 2015 general elections that Myanmar was willing to come up with an appropriate resolution that would suit both countries.

After the widespread ethnic displacement of Muslim Rohingyas by the Myanmar army, the once-lauded leader of Myanmar can no longer count on help from the west. Beijing has little problems with human rights abuses, but being too close to China also brings many dangers, debt trap vassalage being the first and foremost.

Debt trap diplomacy or pragmatism?

China hawks in the west see the Belt and Road Initiative as a form of Chinese debt diplomacy and suspect a nefarious hidden agenda behind Beijing’s largesse. China doves see the BRI as China’s attempts to let other nations enjoy some of the benefits that better infrastructure undoubtedly brought to China’s own interior.

The truth, as in most matters, is probably somewhere in the middle. When Vice President Pence spoke at the APEC meeting in Port Moresby, Papua New Guinea and called the BRI a constraining belt and a one-way road he was not speaking the whole truth. But when China calls its vaunted initiative a win-win, the cases of Malaysia, the Maldives and Myanmar prove that this is not always the case either.

And that completely ignores the port of Hambantota in Sri Lanka, that was handed over to China when the Sri Lankan government could no longer afford the interest payments, or the fact that Pakistan has a balance of payments crisis not in the least because it is too heavily indebted to China.

The Communist Party of China has an ideological underpinning that has largely been ignored for perhaps two decades. Many western observers believed the Communist Party to be devoid of ideology, that staying in power and growing the economy to do so was the pragmatic raison d’être of the Party.

Ideology has made a big comeback under Core Leader Xi Jinping, the Red Emperor for Life. There is definitely some pragmatism involved in the Belt and Road Initiative, but its failures show that China is ready to use heavy-handed intimidation methods from the old Marxist-Leninist playbook. The BRI is creating a lot of infrastructure, but it has also destroyed the myth of the superhuman long-term Beijing planner.

Planning for a 1000-year empire in a changeable world: hits and misses of China's Belt and Road Initiative