On March 28, China’s top economic planning agency, the National Development and Reform Commission (NDRC), released a new action plan outlining key details of Beijing’s “One Belt, One Road” initiative. Chinese president Xi Jinping has made the program a centerpiece of both his foreign policy and domestic economic strategy. Initially billed as a network of regional infrastructure projects, this latest release indicates that the scope of the “Belt and Road” initiative has continued to expand and will now include promotion of enhanced policy coordination across the Asian continent, financial integration, trade liberalization, and people-to-people connectivity. China’s efforts to implement this initiative will likely have an important effect on the region’s economic architecture—patterns of regional trade, investment, infrastructure development—and in turn have strategic implications for China, the United States, and other major powers.
What is the “One Belt, One Road”?
Often referred to jointly as the “One Belt, One Road,” details released so far by China’s official media outlets show the “Belt” as a planned network of overland road and rail routes, oil and natural gas pipelines, and other infrastructure projects that will stretch from Xi’an in central China, through Central Asia, and ultimately reach as far as Moscow, Rotterdam, and Venice. Perhaps awkwardly named, the “Road” is its maritime equivalent: a network of planned port and other coastal infrastructure projects that dot the map from South and Southeast Asia to East Africa and the northern Mediterranean Sea.
The new Belt and Road plan, jointly released by the NDRC and the Ministries of Foreign Affairs and Commerce, highlights that the scope of the initiative will extend well beyond infrastructure construction. The program will also include efforts to promote greater financial integration and use of the Renminbi by foreign countries, create an “Information Silk Road” linking regional information and communications technology networks, and lower barriers to cross-border trade and investment in the region, among other initiatives. New regional institutions, such as the Asian Infrastructure Investment Bank (AIIB) and New Silk Road Fund (NSRF), are also designed in part to complement and support the Belt and Road’s development.
The plan is also notable for its mixing of traditional Chinese diplomatic language (e.g., emphasizing sovereignty and nonintervention) alongside a newer rhetorical focus on adherence to high standards and international norms and the “decisive” role of the market and industry in driving the initiative. This echoes the pledge made by China’s leadership at the November 2013 Third Plenum to “give the market a decisive role in resource allocation,” but it remains to be seen whether or not market forces and commercial considerations will in fact play a critical role in driving the new Silk Road forward.
Potential Benefits to Asia
The “One Belt, One Road” has been referred to as China’s version of the Marshall Plan, a comparison Beijing has sought to downplay as being freighted with geopolitical undertones that it claims are absent in its initiative.
Motivations aside, the initiative is a powerful illustration of China’s growing capacity and economic clout—and the Xi administration’s intent to deploy them abroad. Properly implemented, the projects that comprise the Belt and Road could help enhance regional economic growth, development, and integration. According to the Asian Development Bank, there is an annual “gap” between the supply and demand for infrastructure spending in Asia on the order of $800 billion. Given that infrastructure is at the heart of the Belt and Road, there is room for the initiative to play a constructive role in regional economic architecture. In addition, if this leads to more sustainable and inclusive growth, it could help strengthen the political institutions in the region and reduce the incentives and opportunities for terrorist movements.
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