Why Belt and Road worries the West

ANGELA Merkel and Emmanuel Macron met South-east European leaders in Berlin on Monday. While the summit discussed the conflict between Serbia and Kosovo, also on the agenda was the growing concern in Brussels, Berlin and Paris about China's increasing influence in the sub-region also known as the Balkans.

Yet, the concerns expressed on Monday are just a microcosm of wider Western worries about China's potentially multi-trillion US dollar Belt and Road plan which now has the backing of more than 100 countries and international organisations. This landmark initiative, which some assert as the biggest development push in history, was also the focus of a big summit in Beijing from Friday to Saturday with some 40 governments in attendance.

Attendees included not just China's increasingly important allies like Russia's Vladimir Putin, and Pakistan's Prime Minister Imran Khan, but also Prime Minister Giuseppe Conte of Italy which recently became the first G-7 country to sign on to the initiative in a move that generated alarm not just in Europe but also the United States too.

It is no coincidence that those states most sceptical of the plan sent delegates to Beijing below the rank of national leader. This includes the United States which sent a significantly lower-level delegation.

The summit underlined progress to date: it was announced, for instance, that Chinese companies have already invested US$90 billion in nations signing up to Belt and Road, with a further US$200-300 billion of loans. Beijing also sought to tackle, upfront, concerns that have arisen about so-called Chinese 'debt diplomacy' around the initiative by pledging to respect global debt goals and promote green growth.

Nonetheless, this issue remains a centre point of the US critique of Belt and Road. US Vice-President Mike Pence, for instance, has warned countries not to be seduced by Beijing's initiative which he said was a "constricting belt", and "one way road", that will leave "staggering debt".

Despite these concerns, the scale of China's ambition with the Belt and Road remains huge - seeking to connect an area of the globe representing about 65 per cent of the world's population, one-third of its GDP that helps to move about a quarter of all its goods and services. And the initiative is just part of a wider grand strategy to shape the regional and global orders.

REGIONAL ECONOMIC INTEGRATION

For Beijing is also promoting a series of other key platforms, including the Free Trade Area of Asia Pacific (FTAAP) and a pact known as the Regional Comprehensive Economic Partnership (RCEP). The FTAAP and RCEP (which comprises the 10 Association of South-east Asian nations plus India, Australia, Japan, South Korea, and New Zealand) provide a potential model for regional economic integration which will see Beijing centre-stage.

While the economic rationale for Belt and Road is obvious for Beijing, the political angle is key too, as Western critics are only too aware. Take the example of Africa whose growing importance is illustrated by the fact that its population is forecast to double to 2.2 billion by 2050 with 60 per cent under the age of 25.

Moreover, the continent already houses six of the world's top 12 fastest growing countries: Ethiopia, Democratic Republic of Congo, Cote d'Ivoire, Mozambique, Tanzania and Rwanda. And the IMF also asserts that in the five years to 2023, Africa's overall growth prospects will be among the best in the world.

Small wonder therefore that China is utilising Belt and Road to leverage its political influence there, buttressed by frequent trips from Beijing's top leadership. The Chinese president, premier and foreign minister have reportedly made more than 80 visits to over 40 different African nations over the past decade alone, while Donald Trump may not visit the continent at all during his years in the White House perhaps reflecting his reported references last year to "shithole countries" there.

A good case study here is Kenya which is a key US partner in the region, including in the campaign against terrorism, with a population of around 50 million. Yet, this same nation's external debt is now largely (around 70 per cent) owed to Beijing, with many large infrastructure projects being built by Chinese firms.

Given Mr Trump's apparent lack of concern for Africa, much of the impetus behind current US policy towards the region is currently coming from Congress, rather than the administration. Last Autumn, for instance, legislators passed on a bipartisan basis a landmark bill which will create a US$60 billion new agency aimed at strategic investment in developing countries.

The proposed International Development Finance Corporation (IDFC) is a clear step in Washington's response to China's growing influence and marks a return to US aid policy with commercial diplomacy and geopolitics centre- stage. The proposed new IDFC, which has been endorsed by Mr Trump, will become the pre-eminent US government development finance institution moving forward US interests in multiple ways, including supporting US firms operating in key developing markets and enhancing US geopolitical influence vis-a-vis other countries, especially China.

Yet, during the Trump years, China still looks like assuming an edge in Africa vis-a-vis the United States. And the financial clout and political resolve of Beijing in the continent is also overshadowing other key Western nations such as France, Germany, and the United Kingdom which are also showering Africa with greater interest.

Under Mr Macron, for instance, Paris is seeking to double down ties with its former colonies while embedding relations with the continent's biggest economies, including South Africa and Nigeria. Mrs Merkel has also made numerous trips to the continent, including her latest one this week.

WESTERN ATTENTION

Meanwhile embattled Theresa May made her first and probably only prime ministerial visit last year to see the heads of three major Commonwealth countries: South Africa, Nigeria, and Kenya. For the United Kingdom, the continent has assumed new importance with the Brexit agenda as London seeks to consolidate ties with key non-EU nations as it leaves the Brussels-based club.

However, with the potential exception of the United States, especially under a president more committed to Africa, this upsurge of Western attention risks being dwarfed by the focus of Beijing to the continent. This is why Belt and Road will continue to worry the West, in Africa and beyond, as Beijing doubles down on consolidating its political and economic influence.