London seminar discusses CBRI and CPEC, their impacts on Europe

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Nation special report

LONDON: Under the auspices of ‘The democracy Forum’, a seminar was organized here at Chancellor’s Hall at London University’s Senate House on February 5 to discuss the China’s Belt and Road Initiative and its impact on Europe.

In his welcome address, TDF President Lord Bruce spoke of global fears of Chinese hegemony surrounding the BRI, and of China’s reassurances that the project is not a geo-strategic concept or military alliance but an economic co-operation initiative. Is it simply at trade and security network, he wondered, albeit a hugely costly one that comprises at least six geographic corridors, or a ‘multi-headed hydra unashamedly aligned with national self-interest’?

 In light of the huge hike in Chinese investment in the EU in 2016, Lord Bruce considered the European Commission’s reaction to the BRI’s westward momentum and suggested that ‘surely such a visible extension of economic hegemony can no longer go unquestioned’.

Introducing the first panel of speakers was seminar chair Dr John Hemmings, Director of Asia Studies at the Henry Jackson Society, who highlighted the inter linkages between China’s foreign policy, aid, infrastructure, technology and sea-lane security – the geopolitical results of globalisation – and their impact on the global stage, as well as pointing out that the BRI presents opportunities as well as security challenges.

Theresa Fallon, Founder and Director of the Centre for Russia Europe Asia Studies (CREAS) examined Beijing’s Belt and Road diplomacy and Europe’s response to it,giving an overview of the BRI, Chinese investment in Europe, FDI screening, geopolitics and the public diplomacy of the People’s Republic of China.

“China is shaping Europe much more than Europe is shaping China”, she warned, and a divided Europe is an opportunity for Beijing. We must work hard to improve our democracies, as the BRI is here to stay, and with regard to China, she concluded, ‘constructive vigilance is required’.

In considering how the Belt and Road pushback might be made more productive, Andrew Cainey, Associate Fellow at Chatham House, looked at how partner countries are pushing back on the BRI’s impact and terms, and what does and does not make sense for the sustainable development of those countries.

The implications of the BRI for the international rule of law was the focus for Kathryn Rand, Assistant Director at the Great Britain China Centre, who said an interesting aspect of the BRI was the nexus of politics and law.

A huge challenge facing China will be the need to provide legal certainty for business, said Ms Rand, whilst also maintaining its political oversight of the judiciary. This was best represented by the establishment last year of the China International Commercial Court, which shocked the world but should not, said Ms Rand, necessarily be seen as a threat to legal systems elsewhere.

Dr Pervez Hoodbhoy, a distinguished professor at Lahore’s Forman Christian College, called the BRI a consequence of globalisation, which is itself a consequence of technology. Looking at the BRI in the context of the China-Pakistan Economic Corridor, he evaluated both China’s assertion that its BRI involvement with partner countries is purely on an economic basis, and its claims that the project will build local capacity and support sustainable development in those partner countries.

He lamented the continuing lack of transparency about Chinese investments in Pakistan and failure to hire enough local labour, except in security, with some 12,000 local forces employed in regions such as Balochistan and the Port of Gwadar.Complaints have also arisen about Chinese companies operating in SEZ being untaxed, and Dr Hoodbhoy expressed concerns about the dearth of local goods which have been replaced by Chinese products.

He questioned China’s inroads into the low-tech agricultural sector, and pointed to warning signs coming from Chinese purchase of land. So, while there have been enhancements in some industries, such as steel, local capacity is generally decreasing rather than increasing.

Regarding sustainable development, Dr Hoodbhoy worried about massive Chinese coalmining projects impacting on water availability and producing air-polluting ashthat affects local ecology, as well as the possible problems of two nuclear-powered plants currently being installed in Karachi.

Dr Hoodbhoy said that, while the BRI may be a purely commercial project elsewhere, he did not believe it was true of Pakistan, as what is happening around Gwadar and Balochistan is more strategic, and local people are not getting their fare share of benefits. In conclusion, CPEC has the potential to offer genuine opportunities to Pakistan, but it is currently not being handled well or sensitively enough to do this, and there is too much secrecy and government emphasis on the alliance with China. The BRI as a whole could also bring greater prosperity to the region, but only if it is placed in a better regulatory framework.

Andrew Small, Senior Transatlantic Fellow, Asia Program, The German Marshall Fund looked beyond the backlash, asking whether Beijing could rebalance the BRI. He spoke of how the BRI in many ways externalises much of what China has been doing itself internally for a long time, and called China ‘as good a poster child as any’ for ‘huge expensive infrastructure projects with questionable returns, problematic debt levels, corrupt practices and environmental issues’.

Dr Sarah Ashraf, Policy and Research Manager, Institute for Strategic Dialogue, viewed the shifting strategic imperatives of regional stakeholders in the BRI through a stability and security lens, exploring the implications of CPEC for local governance, transparency and accountability, and socio-economic polarisation.

Closing the proceedings was Barry Gardiner MP, Shadow Secretary of State for International Trade, who said the seminar had generated huge amounts of intellectual stimulation. He asserted that ‘the Chinese were doing imperialism better than we did’, and referred to the importance of focusing on the meaning of sustainable development.

Other audience questions included those on whether Balochistan can legally challenge the Chinese on the BRI and particularly CPEC, and contradictions between the more positive aspects of BRI and negative aspects of Chinese behaviour in Western Xinjiang.