Source: Wall Street Journal
MEGHA MANDAVIA
China ’s large -scale overseas infrastructure construction plan“ Belt and Road ”initiative that China began accelerating around 2015 has recently faced some contraction.
But it is too early to cancel the "Belt and Road" initiative.The shrinkage of the Asian "Belt and Road" project during the crown disease was significant. Most of the funds of the initiative were initially invested in Asia.However, the "Belt and Road" is still expanding their footprints rapidly in Latin America, at least in terms of direct foreign investment.Even in some difficult places, such as Pakistan, the Chinese government is unlikely to give up these large projects because it has been invested a lot.
Pakistan's recent series of headache political problems occurred in Gwadar, where the "Belt and Road" Gwadar Port project is located.Nikkei reports that the protesters are dissatisfied with the safety inspection stations and other issues around the port of Deep Sea, the safety inspection stations around Gwadar. At the end of 2022, the port was blocked, and a police officer was triggered at the end of December.In recent months, Chinese citizens in Pakistan have become the goal of violent attacks.
In view of conflict with India, Pakistan should have been a place of hand in politics.But in fact, Pakistan has become a microcosm of a broader problem in the "Belt and Road": Many low -income governments no longer determine that such cost -effective projects are valuable.Debt burden and local opposition have been vigilant.The global high interest rate, the depreciation of the currency of emerging markets, and the economic loss caused by the crown disease epidemic have increased the weight of those who are suspicious of the "Belt and Road".
The French Foreign Trade Bank analyzes the data of MergerMarket and the American Enterprise Institute. It is not surprising that China ’s loans and direct investment in countries along the“ Belt and Road ”in the“ Belt and Road ”in recent years are not surprising.This part reflects China's global retreat, because most economies, including China, are in difficulties during the epidemic.From 2020 to 2021, the average annual investment in China decreased by 72%from the average annual level of 2015-2019.China ’s direct investment in countries along the“ Belt and Road ”declines slightly slightly at 62%.
However, investment is not unanimously declined.According to data from the French Foreign Trade Bank, from 2020-2021, the average annual investment in China's backyard Latin American countries in the United States is actually four times the average level of 2015-2019.Most of them are assets such as public utilities in Latin American countries.According to the French Foreign Trade Bank, among all the "Belt and Road" areas, the overall economic impact of the Latin American region in the Latin American region has the most serious impact in the epidemic.Some Latin American governments may think that after the impact of the epidemic, directly selling assets is one of the means to obtain some fiscal space.
Obviously, some of the most striking overseas green land investment infrastructure projects have made China suffer, such as Pakistan's Gwadar Port and Sri Lanka Hangbiang Port project.Infrastructure assets that direct investment in income flow may be a way to establish mutual trust with the local government, without the financial and political risks brought by loans to new large projects in unstable areas.In addition, Latin America's rich agricultural and mineral resources are obviously the interest of the Chinese government.With the deterioration of China's relations with developed democratic countries, the Chinese government seems to pay more and more attention to the security of food and supply chain.
In any case, it is impractical to think that the Chinese government will abandon Gwadar and other projects.Michael Kugelman, director of the South Asia Research Institute in Washington, USA Washington, believes that the Chinese government will not give up the "Belt and Road" initiative, whether in Pakistan or other places.Kugelman said that these infrastructure and interconnected projects are still crucial to China's economic interests, and if the Chinese government has a long -term plan to transform some of these projects into military assets, this will also be impossible for its strategic benefits.
The "Belt and Road" initiative may seem to be more careful about the project, pay more attention to fiscal returns, and get along with local people.
