The year 2023 marks the 10th anniversary of the Chinese Belt and Road Initiative (BRI). Beijing has promoted the Initiative as ‘shared benefits-common development’ and since 2013 nearly 150 countries have joined it. Till date China may have spent an estimated US$ 1 trillion and “expenses over the life of the BRI could reach as much as $8 trillion, though estimates vary”. According to report released by the Fanhai International School of Finance (FISF) at Fudan University, Shanghai, “BRI finance and investments were steady in 2022 at US$ 67.8 billion, compared to US$ 68.7 billion in 2021” with a strong possibility of a “rebound” in 2023 given that COVID-related travel restrictions have been eased particularly for Chinese developers.

Meanwhile a report by the US-based research lab AidData, the World Bank, the Harvard Kennedy School and the Kiel Institute for the World Economy has pointed that Beijing handed out US$ 240 billion in “bailout loans” to many countries including Sri Lanka, Pakistan and Turkey. These counties received Chinese loans for infrastructure development under the BRI. The report further goes on to points out that the “bailout system” provides comfort to the recipient countries to not only circumvent “default” but also “continue servicing their BRI debts, at least in the short run,” In this context, the Fudan University Report also notes that “14 countries saw a 100% drop in BRI engagement compared to 2021, including: Russia, Angola, Sri Lanka, Nepal, and Peru”.

Despite the adverse image of the Chinese largesse, the BRI’s trade volume continues to grow, and in 2022 nearly 16,000 freight trains between China and Europe carried 1.6 million containers recording growth of 9% in 2021 to 10% in 2022. This continental trade corridor has now been connected to the sea through the Beibu Gulf in Guangxi province and designated as International Land-Sea Trade Corridor (ILSTC). It connect Chongqing in China with Singapore and other ports of the ASEAN countries. As many as 750,000 TEUs of goods were transported through the ILSTC in 2022, up 18.5% year on year. Chongqing is the ‘operation center and hub’ for China–Europe continental route, the ILSTC and trade with Vietnam, Myanmar, Lao PDR as well as Cambodia through Chinese land border ports.

The BRI continues to attract new partners, particularly the smaller countries who support Beijing’s ‘One China’ objective that envisions Taiwan an "inseparable part of Chinese territory". For instance, Honduras, a Central American country, is the latest to establish diplomatic relations with Beijing. It is useful to mention that Taiwan and Honduras had enjoyed diplomatic relations since 1941. Apparently, Honduras had sought “$2.5 billion [aid from Taiwan] including a loan of $2 billion to help write off debt as well as funds for the construction of a hospital and a dam”. This did not find favour and Taipei decided not to engage in "meaningless" dollar diplomacy. Taiwan still enjoys diplomatic relations with 13 countries.

The case of Solomon Islands is well known and last year Prime Minister Manasseh Sogavare decided to sign an agreement with Beijing under which Chinese military and law enforcement forces would assist the island nation in maintaining “social order, protecting people’s lives and property, and providing humanitarian assistance”. Earlier, in 2019, Solomon Island had announced ceasing diplomatic recognition of Taiwan. Prime Minister Sogavare, arguably at the behest of China, also accused Australia for not taking his country into confidence while announcing the AUKUS treaty: “One would expect that as a member of the Pacific family, the Solomon Islands and members of the Pacific should have been consulted to ensure this AUKUS treaty is transparent.”

Unlike Honduras and Solomon Islands, big countries such as Brazil, the third largest economy in the Americas and expected to be the sixth largest economy in the world by 2030, may not be considering joining the BRI. It may be noted that Brazil is member of the BRICS group i.e. Brazil, Russia, India, and South Africa). Both countries have enjoyed good relations notwithstanding the changes in domestic politics in Brazil. There have been “six plenary meetings in 18 years” and the last meeting between Brazilian vice-president Hamilton Mourão met with his Chinese counterpart Wang Qishan took place in May 2022. Brazil ranks fourth among the countries that received investments from 2005 to 2021.  

Finally, the BRI continues to remain popular notwithstanding the “Build Back Better World (B3W)” G7 initiative that aims to offer an alternate to China for building infrastructure needed by the developing world.

Dr Vijay Sakhuja is Associated with Kalinga International Foundation, New Delhi.