How China’s Belt and Road Initiative is changing after a decade of big projects and big debts
How China’s Belt and Road Initiative is changing after a decade of big projects and big debts
FILE - Chinese President Xi Jinping raises his glass and proposes a toast during the welcome banquet for visiting leaders attending the Belt and Road Forum at the Great Hall of the People, on April 26, 2019. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (Nicolas Asfouri/Pool Photo via AP, File)
A gardener waters the grass near the logo for the Belt and Road Forum in Beijing, Monday, Oct. 16, 2023. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (AP Photo/Ng Han Guan)
FILE - Chinese President Xi Jinping and his wife Peng Liyuan, front center, attend a group photo session with other leaders at a welcoming banquet for the Belt and Road Forum at the Great Hall of the People, in Beijing, on April 26, 2019. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (Jason Lee/Pool Photo via AP, File)
FILE - Women in ethnic dresses perform on a passenger carriage of the first regular train service on the Chinese section of the railway between Kunming and Vientiane, the Laotian capital, after its debut ceremony in Kunming in southwestern China’s Yunnan province, on Dec. 3, 2021. The railway is one of hundreds of projects under Beijing’s Belt and Road Initiative to build ports, railways and other facilities across Asia, Africa and the Pacific. (Chinatopix via AP, File)
FILE - Workers walk past a banner at the construction site of Halim Station ahead of an operational test run of the Jakarta-Bandung high-speed train, which is part of China’s Belt and Road infrastructure initiative, in September, in Jakarta, Indonesia, on Aug. 12, 2023. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Dita Alangkara, File)
FILE- Officials stand near the high-speed train during the opening ceremony for launching Southeast Asia’s first high-speed railway, part of China’s Belt and Road infrastructure initiative, at Padalarang station in Bandung, West Java, Indonesia, on Oct. 2, 2023. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Achmad Ibrahim, File)
FILE - Chinese President Xi Jinping’s speech at the opening of the Belt and Road Forum is displayed on a big screen near decorations depicting Chinese Admiral Zheng He who commanded expeditionary voyages across Asia and East Africa in the 15th century and a modern high speed train on May 14, 2017, in Beijing. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Ng Han Guan, File)
FILE - A Panama Canal worker docks the Chinese container ship Cosco at the Panama Canals’ Cocoli Locks, in Panama City on Dec. 3, 2018. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Arnulfo Franco, File)
FILE - Sri Lankan port workers hold a Chinese national flag to welcome Chinese research ship Yuan Wang 5, bristling with surveillance equipment, as it arrives in Hambantota International Port in Hambantota, Sri Lanka, on Aug. 16, 2022. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Eranga Jayawardena, File)
FILE - Residents rest near a display for the upcoming Third Belt and Road Forum and propaganda Chinese socialist values in Beijing, Monday, Oct. 16, 2023. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (AP Photo/Ng Han Guan)
FILE - Chinese President Xi Jinping, left, stands with Italian President Sergio Mattarella for a photo opportunity at the Quirinale Presidential Palace in Rome, on March 22, 2019. A total of 152 countries have signed a BRI agreement with China, though Italy, the only western European country to do so, is expected to drop out when it comes time to renew in March of next year. (AP Photo/Alessandra Tarantino, Pool, File)
FILE - An attendee at a conference looks up near a portrait of Chinese President Xi Jinping with the words “Xi Jinping and One Belt One Road” and “One Belt One Road strategy,” in Beijing, April 28, 2017. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (AP Photo/Ng Han Guan, File)
FILE - Chinese President Xi Jinping raises his glass and proposes a toast during the welcome banquet for visiting leaders attending the Belt and Road Forum at the Great Hall of the People, on April 26, 2019. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (Nicolas Asfouri/Pool Photo via AP, File)
FILE - Chinese President Xi Jinping raises his glass and proposes a toast during the welcome banquet for visiting leaders attending the Belt and Road Forum at the Great Hall of the People, on April 26, 2019. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (Nicolas Asfouri/Pool Photo via AP, File)
A gardener waters the grass near the logo for the Belt and Road Forum in Beijing, Monday, Oct. 16, 2023. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (AP Photo/Ng Han Guan)
A gardener waters the grass near the logo for the Belt and Road Forum in Beijing, Monday, Oct. 16, 2023. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (AP Photo/Ng Han Guan)
FILE - Chinese President Xi Jinping and his wife Peng Liyuan, front center, attend a group photo session with other leaders at a welcoming banquet for the Belt and Road Forum at the Great Hall of the People, in Beijing, on April 26, 2019. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (Jason Lee/Pool Photo via AP, File)
FILE - Chinese President Xi Jinping and his wife Peng Liyuan, front center, attend a group photo session with other leaders at a welcoming banquet for the Belt and Road Forum at the Great Hall of the People, in Beijing, on April 26, 2019. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (Jason Lee/Pool Photo via AP, File)
FILE - Women in ethnic dresses perform on a passenger carriage of the first regular train service on the Chinese section of the railway between Kunming and Vientiane, the Laotian capital, after its debut ceremony in Kunming in southwestern China’s Yunnan province, on Dec. 3, 2021. The railway is one of hundreds of projects under Beijing’s Belt and Road Initiative to build ports, railways and other facilities across Asia, Africa and the Pacific. (Chinatopix via AP, File)
FILE - Women in ethnic dresses perform on a passenger carriage of the first regular train service on the Chinese section of the railway between Kunming and Vientiane, the Laotian capital, after its debut ceremony in Kunming in southwestern China’s Yunnan province, on Dec. 3, 2021. The railway is one of hundreds of projects under Beijing’s Belt and Road Initiative to build ports, railways and other facilities across Asia, Africa and the Pacific. (Chinatopix via AP, File)
FILE - Workers walk past a banner at the construction site of Halim Station ahead of an operational test run of the Jakarta-Bandung high-speed train, which is part of China’s Belt and Road infrastructure initiative, in September, in Jakarta, Indonesia, on Aug. 12, 2023. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Dita Alangkara, File)
FILE - Workers walk past a banner at the construction site of Halim Station ahead of an operational test run of the Jakarta-Bandung high-speed train, which is part of China’s Belt and Road infrastructure initiative, in September, in Jakarta, Indonesia, on Aug. 12, 2023. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Dita Alangkara, File)
FILE- Officials stand near the high-speed train during the opening ceremony for launching Southeast Asia’s first high-speed railway, part of China’s Belt and Road infrastructure initiative, at Padalarang station in Bandung, West Java, Indonesia, on Oct. 2, 2023. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Achmad Ibrahim, File)
FILE- Officials stand near the high-speed train during the opening ceremony for launching Southeast Asia’s first high-speed railway, part of China’s Belt and Road infrastructure initiative, at Padalarang station in Bandung, West Java, Indonesia, on Oct. 2, 2023. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Achmad Ibrahim, File)
FILE - Chinese President Xi Jinping’s speech at the opening of the Belt and Road Forum is displayed on a big screen near decorations depicting Chinese Admiral Zheng He who commanded expeditionary voyages across Asia and East Africa in the 15th century and a modern high speed train on May 14, 2017, in Beijing. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Ng Han Guan, File)
FILE - Chinese President Xi Jinping’s speech at the opening of the Belt and Road Forum is displayed on a big screen near decorations depicting Chinese Admiral Zheng He who commanded expeditionary voyages across Asia and East Africa in the 15th century and a modern high speed train on May 14, 2017, in Beijing. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Ng Han Guan, File)
FILE - A Panama Canal worker docks the Chinese container ship Cosco at the Panama Canals’ Cocoli Locks, in Panama City on Dec. 3, 2018. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Arnulfo Franco, File)
FILE - A Panama Canal worker docks the Chinese container ship Cosco at the Panama Canals’ Cocoli Locks, in Panama City on Dec. 3, 2018. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Arnulfo Franco, File)
FILE - Sri Lankan port workers hold a Chinese national flag to welcome Chinese research ship Yuan Wang 5, bristling with surveillance equipment, as it arrives in Hambantota International Port in Hambantota, Sri Lanka, on Aug. 16, 2022. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Eranga Jayawardena, File)
FILE - Sri Lankan port workers hold a Chinese national flag to welcome Chinese research ship Yuan Wang 5, bristling with surveillance equipment, as it arrives in Hambantota International Port in Hambantota, Sri Lanka, on Aug. 16, 2022. China’s Belt and Road initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs. (AP Photo/Eranga Jayawardena, File)
FILE - Residents rest near a display for the upcoming Third Belt and Road Forum and propaganda Chinese socialist values in Beijing, Monday, Oct. 16, 2023. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (AP Photo/Ng Han Guan)
FILE - Residents rest near a display for the upcoming Third Belt and Road Forum and propaganda Chinese socialist values in Beijing, Monday, Oct. 16, 2023. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (AP Photo/Ng Han Guan)
FILE - Chinese President Xi Jinping, left, stands with Italian President Sergio Mattarella for a photo opportunity at the Quirinale Presidential Palace in Rome, on March 22, 2019. A total of 152 countries have signed a BRI agreement with China, though Italy, the only western European country to do so, is expected to drop out when it comes time to renew in March of next year. (AP Photo/Alessandra Tarantino, Pool, File)
FILE - Chinese President Xi Jinping, left, stands with Italian President Sergio Mattarella for a photo opportunity at the Quirinale Presidential Palace in Rome, on March 22, 2019. A total of 152 countries have signed a BRI agreement with China, though Italy, the only western European country to do so, is expected to drop out when it comes time to renew in March of next year. (AP Photo/Alessandra Tarantino, Pool, File)
FILE - An attendee at a conference looks up near a portrait of Chinese President Xi Jinping with the words “Xi Jinping and One Belt One Road” and “One Belt One Road strategy,” in Beijing, April 28, 2017. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (AP Photo/Ng Han Guan, File)
FILE - An attendee at a conference looks up near a portrait of Chinese President Xi Jinping with the words “Xi Jinping and One Belt One Road” and “One Belt One Road strategy,” in Beijing, April 28, 2017. China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns. (AP Photo/Ng Han Guan, File)
BEIJING (AP) — China’s Belt and Road Initiative looks to become smaller and greener after a decade of big projects that boosted trade but left big debts and raised environmental concerns.
The shift comes as leaders from across the developing world descend on Beijing this week for a government-organized forum on what is known as BRI for short.
The initiative has built power plants, roads, railroads and ports around the world and deepened China’s relations with Africa, Asia, Latin America and the Mideast. It is a major part of Chinese President Xi Jinping’s push for China to play a larger role in global affairs.
WHAT IS THE BRI?
Called “One Belt, One Road” in Chinese, the Belt and Road Initiative started as a program for Chinese companies to build transportation, energy and other infrastructure overseas funded by Chinese development bank loans.
The stated goal was to grow trade and the economy by improving China’s connections with the rest of the world in a 21st-century version of the Silk Road trading routes from China to the Middle East and onto Europe.
Xi unveiled the concept in broad terms on visits to Kazakhstan and Indonesia in 2013 and it took shape in the ensuing years, driving the construction of major projects from railroads in Kenya and Laos to power plants in Pakistan and Indonesia.
HOW BIG IS IT?
A total of 152 countries have signed a BRI agreement with China, though Italy, the only western European country to do so, is expected to drop out when it comes time to renew in March of next year.
“Italy suffered a net loss,” said Alessia Amighini, an analyst at the Italian think tank ISPI, as the trade deficit with China more than doubled since Italy joined in 2019.
China became a major financer of development projects under BRI, on par with the World Bank. The Chinese government says the initiative has launched more than 3,000 projects and “galvanized” nearly $1 trillion in investment.
China filled a gap left as other lenders shifted to areas such as health and education and away from infrastructure after coming under criticism for the impact major building projects can have on the environment and local communities, said Kevin Gallagher, the director of the Boston University Global Development Policy Center.
Chinese-financed projects have faced similar criticism, from displacing populations to adding tons of climate-changing greenhouse gases to the atmosphere.
WHAT ABOUT THE DEBT TRAP?
Chinese development banks provided money for the BRI projects as loans, and some governments have been unable to pay them back.
That has led to allegations by the U.S., India and others that China was engaging in “debt trap” diplomacy: Making loans they knew governments would default on, allowing Chinese interests to take control of the assets. An oft-cited example is a Sri Lankan port that the government ended up leasing to a Chinese company for 99 years.
Many economists say that China did not make the bad loans intentionally. Now, having learned the hard way through defaults, China development banks are pulling back. Chinese development loans have already plummeted in recent years as the banks have become more cautious about lending and many recipient countries are less able to borrow, given their already high levels of debt.
Chinese loans have been a major contributor to the huge debt burdens that are weighing on economies in countries such as Zambia and Pakistan. Sri Lanka said last week that it had reached an agreement with the Export-Import Bank of China on key terms and principles for restructuring its debt as it tries to emerge from an economic crisis that toppled the government last year.
WHAT’S NEXT FOR BRI?
Future BRI projects are likely not only to be smaller and greener but also rely more on investment by Chinese companies than on development loans to governments.
Christoph Nedopil, director of the Asia Institute at Griffith University in Australia, believes that China will still undertake some large projects, including high-visibility ones such as railways and others, including oil and gas pipelines, that have a revenue stream to pay back the investment.
A recent example is the launch of a Chinese high-speed railway in Indonesia with much fanfare in both countries.
On the climate front, China has pledged to stop building coal power plants overseas, though it remains involved in some, and is encouraging projects related to the green transition, Nedopil said. These range from wind and solar farms to factories for electric vehicle batteries, such as a huge lithium-ion battery plant that has stirred environmental concerns in BRI-partner Hungary.
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Associated Press Business Writer Colleen Barry in Milan contributed to this report.