On 25-27 April 2019, Beijing hosted the second Belt and Road Forum for International Cooperation in an undoubtable demonstration of cooperative multilateral power on a global scale. As a result of the forum, more than 283 concrete results were achieved in the fields of infrastructure development, policy coordination, and people-to-people cooperation. The event should be seen to represent significant global development amidst uncertain times.
The global development crisis
It is no secret that the crisis of 2007-2008 began with the subprime mortgage collapse in the United States. This was due to low quality financial instruments – ‘derivatives’ – that inflated a financial bubble such that the real value of goods was substantially overvalued due to a ‘frenzied demand’ based on incorrect information about economic realities. In practical terms, the world economy became ‘financialised’; i.e., the financial sector increasingly dominated the real sector. This uncontrolled imbalance eventually led to the financial crisis and later to the global systemic crisis.
The financial crisis of 2008 led to a lower level of investment in infrastructure projects. On one hand, governments reduced investment in long-term infrastructure because this was less painful cutting other budgets at a time when it was essential to secure the provision of basic necessities. On the other hand, private investors also switched away from infrastructure projects towards more liquid assets and projects with quick returns.
The financial sector increasingly dominated the real sector. This uncontrolled imbalance eventually led to the financial crisis
Searching for a new paradigm of socio-economic development
Numerous studies conducted after the crisis demonstrated a positive correlation between investment in infrastructure and economic growth. Importantly, it was also shown that infrastructure projects play a positive role in short-term outcomes as well, due to their creation of new jobs and their development of local enterprises, which increase long-term regional development levels. Another conclusion voiced by many prominent economists over the last ten years has been the necessity of developing a new economic model to replace the existing neoliberal system because neoliberalism no longer meets requirements. Such statements were difficult to imagine before the crisis, but now seem obvious.
Such problems, alongside possible solutions, have been a theme of ongoing importance in the research and gatherings conducted under the framework of the Dialogue of Civilizations (DOC), which was founded in 2002.
The original name expressed the relationship between economic and logistics corridors – hence ‘road’ – and development in terms of a ‘belt’, which comprised the foundational understanding of the proposed initiative.
As part of the DOC’s work, initial ideas on a new approach to understanding the role of infrastructure projects in global development were formulated in a report for the IV Russian-Singapore Business Forum in 2010. Reconfiguration of the financial and economic map of the world: The role of the current crisis and the possibilities for Russia focused on the changing structure of the world economy under conditions of crisis. Many ideas voiced at the forum were then implemented in the conceptual overview of the ‘Trans-Eurasian Belt Development: RAZVITIE’ project and presented at a specially organised conference, ‘Trans-Eurasian Belt Development: RAZVITIE; Milan Milestone: A new dimension of cooperation’, on 7-8 November 2012 in Italy.
In September 2013, during a state visit to Kazakhstan, President Xi Jinping of the People’s Republic of China proposed the formation of an international initiative, ‘One Belt, One Road’. The original name expressed the relationship between economic and logistics corridors – hence ‘road’ – and development in terms of a ‘belt’, which comprised the foundational understanding of the proposed initiative.
Economic egotism and arrogance is giving way to rational collectivism and an orientation towards a new type of globalisation, based on principles of equality, sovereignty, and mutual development
On 8 May 2015, following negotiations between the leaders of Russia and China, a joint statement on cooperation between the Eurasian Economic Union (EEU) and the One Belt, One Road Initiative was signed. Some experts in China and Russia referred to this joint concept as ‘One Belt, One Union’.
On 25-27 April 2019, Beijing hosted the second ‘Belt and Road Forum for International Cooperation’, which was attended by 37 foreign heads of state and government and representatives from more than 150 countries and 90 international organisations. The level of participants and the attention received around the world left no doubt as to the growing attractiveness of the initiative. It also showed an increasingly widespread understanding that economic egotism and arrogance is giving way to rational collectivism and an orientation towards a new type of globalisation, based on principles of equality, sovereignty, and mutual development.
Challenges on the path to implementation
Taking into account the scale of the Belt and Road Initiative and the amount of investment China put into it through the newly founded multilateral financial institutions like the Asian Infrastructure Investment Bank, the New Development Bank, and the Silk Road Fund, it is not surprising that major powers including the European Union and the US are expressing significant concerns.
The BRI does not dominate or replace existing development programmes; rather, it seeks to build mutually beneficial partnerships.
On one hand, this is due to an inherent Western scepticism about any initiative offered by the non-Western world. On the other hand, as the geography of the project expands and its support grows across the developing world, Western countries are beginning to worry that their long-time dominant positions are changing. This is also a consequence of the fact that for a long time, the traditional international development institutions did not provide the necessary weight for developing countries to participate in the global financial system, considering their real contribution to global economic development alongside their institutional voting power and roles.
In recent years characterised by global uncertainty, many countries have come up with their own international development projects. ‘Bright Path’ in Kazakhstan, ‘Middle Corridor’ in Tukey, ‘Path of Development’ in Mongolia, ‘Amber Road’ in Poland, ‘Two Corridors, One Circle’ in Vietnam are just a few, but the Belt and Road Initiative is the most advanced from a practical perspective. However, this does not mean the BRI dominates or replaces existing development programmes; rather, it seeks to build mutually beneficial partnerships.
New approaches could change the very essence of geopolitics and geo-economics by altering the outdated Cold War mentality of the past
According to the China Railway Corporation, China-Europe freight trains made 6,363 trips in 2018, surging 73% up from 2017. The trains united 59 Chinese cities and 49 cities in 15 European countries. Freight services, a significant part of the Belt and Road Initiative, began operation in March 2011. However, for future development, overcoming significant existing limitations, such as updating and investing in existing transport and logistics infrastructure, customs procedures, and cross-border cooperation, will not be enough. In addition to such ‘technical’ challenges, other risks are tied up in the existing contradictions of global political economy and society. For example, construction of cross-border infrastructure will obviously be difficult throughout the disputed territory of Kashmir, besides other regions in Asia and Africa in which military confrontation among warring groups or terrorist groups exists.
At the same time, the key idea of the Belt and Road initiative – ‘equal and mutually beneficial cooperation without imposing any political conditions’ – clearly contradicts the currently dominant thesis in contemporary world politics. The new approaches could change the very essence of geopolitics and geo-economics by altering the outdated Cold War mentality of the past. Geopolitical theory has always been articulated through a lens of conflict, dividing the world into ‘us’ and ‘them’. The pervading instability of ongoing trade wars and sanctions contribute their own limitations, which will need to be overcome, for which particular impact derives from economic relations between the US and other countries, primarily China.
Critical issues for the development of global initiatives include deficits of leadership, practical skills, and knowledge to manage and support dialogue-based international cooperation towards human-centred development goals
The Belt and Road Initiative could be the source of a future model of global development-in- solidarity. The key here is the inability to return to the concept of a unipolar or bipolar world, which can be seen today in global trends towards development of a truly multilateral world. The change toward development-in- solidarity, which we see in the Belt and Road Initiative, provides a very different perspective. This enables consideration of external geopolitical and geo-economic zones, not as sources of danger, but as parts of a planet-wide life-support mechanism for development at local, regional, and global levels.
Priorities for overcoming current limitations
Critical issues for the development of global initiatives include deficits of leadership, practical skills, and knowledge to manage and support dialogue-based international cooperation towards human-centred development goals. Experts within and beyond the policymaking community should foster serious scientific and practical efforts to support the research and development of new socio-economic models, based around development-in-solidarity, in which cooperative multilateral mechanisms are used. The work of the Dialogue of Civilization Research Institute has shown that this is not only possible, but also extremely productive.
One example of such international cooperation is the independent community of leading think tanks – Think 20 (T20), which acts in support of the G20 – which brings together more than 1,000 experts from around the world to support the policymaking process. The DOC participated in a T20 task force that developed policy recommendations in the field of infrastructure. Let us hope that cooperative initiatives like this can serve as starting points for shared global civilisational cooperation.
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