China’s Belt and Road Initiative, which now involves 44 African countries, was launched ten years ago. President Xi Jinping launched it in 2013 with a first speech in Kazakhstan and a second in Indonesia. The initiative is something of a trial-and-error development puzzle: It lets Chinese observers track Xi’s next move to help define exactly what he is.

However, the two speeches provide lasting guidance. The speech in Kazakhstan outlined five elements of the Belt: strengthening political communication; road connection; currency circulation; interpersonal relationships; and promoting unhindered trade. In Indonesia, the five points were more abstract and diplomatic in focus. They were formulated to strive for win-win cooperation, mutual support and affinity, and to remain open and inclusive.

So what has happened since then? As an economist with a keen interest in the political economy of China-Africa relations, I have studied the Belt and Road Initiative since its inception.

Among the more tangible achievements so far is the promotion of “road connectivity.” China has contributed to the financing and construction of highways, rail and energy projects in various countries. In many places, people, goods and commodities are flowing more smoothly than ever before, within and between countries. But at a price. Most of these projects were financed by loans from Chinese banks, including the China Export Import Bank and the China Development Bank.

To mark the 10th anniversary, Xi outlined the initiative’s progress at a forum in October. He also committed to improving the quality of development cooperation and provided further details on people-to-people relations and in particular areas of political dialogue.

There is a lot of emphasis on a reduction in spending on the Belt and Road Initiative. But if those promises take shape, the first few years of big spending could become a down payment. This down payment came at a time of low interest rates and provided the impetus for some important and highly visible infrastructure projects.

Xi’s announcement at this year’s forum offered news old and new for the Belt and Road Initiative and its signatories. For African signatories (and their regional organizations and development banks) to make the most of what China has to offer, they need to understand the origins of the Belt and Road Initiative, as well as what has and has not changed since then.

Furthermore, Xi’s announcement comes at a time when China’s relationship with the African continent is changing, as I discussed in a recent article. The change means that China-Africa relations will no longer focus solely on oil, raw materials and large infrastructure projects. It draws attention to industrial production, job creation and investment leading to African exports, as well as productivity-enhancing opportunities in agricultural and digital technology. Dubbed the “Hunan Model,” this model is named after the province in southern China that is leading the push. This also helps explain why China’s lending is shifting from bilateral development finance to more commercial and trade finance loans.

Promise 10 years later in comparison

Xi made eight key commitments at the October 2023 forum. More than half of these relate directly to policy priority areas announced a decade ago.

  • Xi promised to build multi-dimensional Belt and Road connectivity. He referred to roads, rail, port and air transport as well as the associated logistics and trade corridors.

  • He promised to open China’s economy more to the world. Higher trading levels would be a possibility. In addition to a new focus on the digital economy, Xi added that China will set up pilot zones for e-commerce-based cooperation. In Africa, the two existing digital trade hubs that Alibaba has set up in Ethiopia and Rwanda as part of its electronic World Trade Platform Initiative could provide a guide to this.

  • He spoke of “practical cooperation”. This appears to relate to funding expensive infrastructure projects, smaller livelihood projects, and technical and vocational education. This has an aspect of overlap with currency circulation, human relations, unhindered trade and much more.

  • Xi also promised to support people-to-people exchanges in his recent speech. This is a direct copy of the first opening speech of 2013. However, he added details on the creation of arts and cultural alliances. China would also hold a “Liangzhu Forum” to improve dialogue on civilization.

  • Finally, in line with previous commitment to enhanced political dialogue, Xi promised to strengthen institutional building for international cooperation under the Belt and Road Initiative. This refers to building platforms for cooperation in energy, taxation, finance, green development, disaster risk reduction, anti-corruption, think tanks, media, culture and other areas.

While expanding government lending is currently a challenge while addressing legacy debt sustainability issues, Chinese policy banks continue to lend to institutions in the Global South. For example, ahead of the Afreximbank forum, the China Development Bank agreed to a loan of 400 million African Continental Free Trade Area.

Beyond promises made by Xi in his speech at this year’s forum, an increase in funding for China’s political banks was announced. In addition, the agreements reached between the participants also signal a commitment to the original principles of the Belt and Road Initiative. For example, in his speech in Kazakhstan in 2013, Xi called for increased cash circulation. In addition to developing its mobile payments ecosystem, China is now testing its emerging central bank digital currency, eCNY, domestically and internationally.

New promises

Three new political promises are added to the promises made a decade ago.

  • China will promote green development, including green infrastructure, green energy and green transportation. It will hold a Green Innovation Conference of the Belt and Road Initiative and build an expert network. China also promised to provide 100,000 training opportunities in green development areas.

  • China will continue to promote scientific and technological innovation. It will hold a conference on science and technology exchange and increase the number of joint laboratories that support the exchange and training of young scientists. Xi also promised that China would propose a global initiative to govern artificial intelligence and promote safe development of artificial intelligence.

  • China will promote cooperation based on integrity. This includes publishing details of the Belt and Road’s successes and prospects and establishing a system to assess compliance.

These new areas are of increasing economic importance to China, especially given its rapid population aging and competition with high-income countries.

The future

While the two opening speeches of the Belt and Road Initiative had a very broad agenda, Xi’s 10-year anniversary speech revealed progress on previous issues and a push to improve the quality of development. In particular, interpersonal relations and the areas of political dialogue that should be promoted were addressed in more detail.

He added some new areas such as: B. management of artificial intelligence, green development, e-commerce and greater emphasis on scientific and technical cooperation. These new areas are becoming increasingly important economically for China.

A comparison of the new policy signals with the previous ones suggests that the initiative is inherently adaptable. In addition, since the COVID pandemic, some countries that had benefited from China’s new level of Belt and Road lending have run into debt problems and interest rates have risen. This is a sign of China’s increased interest in lending to regionally and locally existing multilateral development and commercial banks that are relatively well positioned to target local entrepreneurs and development. In Africa, this presents a new opportunity to develop strategies that can sustainably utilize Chinese resources to promote the independent advancement of the African Continental Free Trade Agreement and local socio-economic development.

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