China’s Second Belt and Road Forum

On April 25-27, President Xi Jinping will welcome leaders from 37 countries and delegates from over 150 countries at the second Belt and Road forum in Beijing. Chinese officials aim to use the gathering to help repair the Belt and Road Initiative’s (BRI) brand—which scandals have tarnished since the first forum in May 2017—but promises for reform will require further monitoring and scrutiny.

Q1: What is China’s BRI?

A1: China’s BRI is Xi’s signature foreign policy vision and consists of two main components: an overland Silk Road Economic Belt connecting China with Central Asia and beyond and an ocean-based 21st Century Maritime Silk Road to China’s south. Announced in 2013 and enshrined in the Communist Party Constitution in 2017, it aims to put China at the center of global economic affairs through improving hard infrastructure, soft infrastructure, and even cultural ties.

Although the BRI looks like a grand strategy on aspirational maps, on the ground, it has been shaped and skewed by a host of competing actors. There have been no criteria for what qualifies as a BRI project, allowing interest groups within and outside China to repackage their own efforts as supporting the initiative. Reflecting these dynamics, the BRI has grown since its announcement to include activities in the Arctic, cyberspace, and even outer space. Over 125 countries have signed BRI cooperation documents according to Chinese state media, but participation is no guarantee of benefits, which have ranged greatly.

Given its ambiguity, the BRI’s size and scope are often misinterpreted. Guesstimates for BRI-related spending have ranged as high as $8 trillion, but a closer look suggests that even China’s promise to provide $1 trillion of infrastructure beyond its borders has not yet been met. The BRI is often compared to the Marshall Plan, through which the United States helped rebuild Western European economies after World War II. But unlike the Marshall Plan, the BRI has been open-ended, less centrally controlled, and focused primarily on developing economies, where governance is weaker and investment risks are higher.

Q2: What does Xi hope to accomplish at the forum?

A2: Scandals have damaged the BRI brand since the first forum in May 2017, and Xi will be aiming to repair it. Outside observers, as well as China’s partners, have raised concerns about corruption, debt sustainability, environmental impacts, and local benefits, as well as questioning China’s underlying strategic aims. High-profile projects in Sri Lanka, Malaysia, Montenegro, and elsewhere have undercut the BRI’s promise to deliver “win-win” outcomes, appearing to benefit China at the expense of its partners.

The forum provides an opportunity to demonstrate that China is adapting the BRI to address these concerns. One draft communique, for example, includes new language on debt sustainability and environmental concerns. Chinese officials are considering steps to improve project selection and assert greater control of the BRI, including adopting criteria for BRI projects. Beijing also wants to attract more partners to finance BRI projects, helping it share the burden for backing projects and the reputational risk when things go wrong.

Chinese officials can also point to the BRI’s expanding roster, particularly recent additions in Europe. Recent symbolic victories include Italy signing an MOU and Greece joining China’s regional grouping for Central and Eastern Europe. Switzerland has announced that it will sign an MOU as well. But Europe’s three largest economies— the UK, Germany, and France—have resisted pressure to join, and there are indications that the EU is preparing to mount a stronger response to Chinese investments within the EU and its backyard.

Q3: Is this a new phase for the BRI?

A3: China’s promises for a revamped BRI will require further monitoring and scrutiny. Real changes will not be easy because they involve costs for China. Ensuring that projects deliver more local benefits, by hiring more local workers, for example, means hiring fewer Chinese workers. Bringing in more outside partners could mean less control over project specifics. Increasing transparency will make it harder to favor certain firms and funnel money to friends in high places. While it is encouraging that Chinese officials are talking more openly about prioritizing debt sustainability and environmental sustainability, real change will require more than signing symbolic documents. These promises are politically expedient but will remain empty without greater transparency and enforcement.

Q4: How should the United States respond?

A4: The best U.S. response to China’s BRI is not a response at all, but a compelling U.S. economic vision, resourced strategically and sustained over time. The world needs more infrastructure than any single state can provide, and disenchantment with China’s BRI provides an opportunity for the United States to work with its partners and allies to deliver high-quality infrastructure. Seizing that opportunity, a new report by the CSIS Global Infrastructure Task Force , The Higher Road, proposes seven recommendations and specific implementation steps for advancing U.S. interests, including focusing on strategic sectors, working with partners and allies, and catalyzing private sector investment.

Matthew P. Goodman is senior vice president and holds the Simon Chair in Political Economy at the Center for Strategic and International Studies in Washington, D.C. Jonathan E. Hillman is director of the Reconnecting Asia Project at CSIS.

Critical Questions is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

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Matthew P. Goodman

Matthew P. Goodman

Former Senior Vice President for Economics

Jonathan E. Hillman