China pledges $124 B for new Silk Road

Dangles $8.7-B aid for developing countries

BEIJING – Chinese President Xi Jinping yesterday pledged $124 billion for his ambitious new Silk Road plan to forge a path of peace, inclusiveness and free trade, and called for the abandonment of old models based on rivalry and diplomatic power games.

China has touted what it formally calls the Belt and Road Initiative as a new way to boost global development since Xi unveiled the plan in 2013, aiming to expand links among Asia, Africa, Europe and beyond underpinned by billions of dollars in infrastructure investment.

China’s most important diplomatic event of the year, the two-day summit offers Xi another chance to bolster China’s global leadership ambitions as US President Donald Trump promotes “America first” and questions existing global free trade initiatives like the North American Free Trade Agreement signed by Canada, Mexico and the US to create a trilateral trade bloc in North America.

“We should build an open platform of cooperation and uphold and grow an open world economy,” Xi told the opening of the summit.

Xi said the world must create conditions that promote open development and encourage the building of systems of “fair, reasonable and transparent global trade and investment rules.”

“Trade is the important engine of economic development,” Xi said.

He said the world must promote the multilateral trade system, the establishment of free trade regions, and the facilitation of free trade.

Massive funding boost

Xi pledged a massive funding boost to the new Silk Road, including an extra 100 billion yuan ($14.5 billion) into the existing Silk Road Fund, 380 billion yuan ($55 million) in loans from two policy banks and 60 billion yuan ($8.7 billion) in aid to developing countries and international institutions in new Silk Road countries.

In addition, Xi said China would encourage financial institutions to expand their overseas yuan fund businesses to the tune of 300 billion yuan.

Xi did not give a timeframe for the new loans, aid and funding pledged yesterday.

Leaders from 29 countries are attending the forum, which started yesterday and ends today.

Skepticism

Some Western diplomats have expressed unease about both the summit and the plan as a whole, seeing it as an attempt to promote Chinese influence globally.

Governments from Washington to New Delhi worry that Beijing is using the initiative to build its own political influence and erode theirs, or that China might undermine environmental standards or leave poor countries burdened with debt.

India delivered an implicit criticism of China’s plan Saturday in a statement from its foreign ministry that said such an initiative should meet international norms and not create unsustainable debt.

India also has objected to Chinese state-owned companies working in the Pakistani-held part of Kashmir, the Himalayan region claimed by both sides, seeing that as an endorsement of Pakistan’s control.

“No country can accept a project that ignores its core concerns on sovereignty and territorial integrity,” the statement said.

Some diplomats and political analysts say Beijing is trying to create a political and economic network centered on China, push the US out of the region and rewrite rules on trade and security.

China has rejected criticism of the plan and the summit, saying the scheme is open to all, is a win-win, and aimed only at promoting prosperity.

Xi said the initiative was not meant to reinvent the wheel but “complement the development strategies of countries involved by leveraging their comparative strengths.”

“What we hope to create is a big family of harmonious co-existence,” Xi said, adding pursuit of the initiative will not resort to outdated geopolitical maneuvering.

“China is willing to share its development experience with all countries. We will not interfere in other countries’ internal affairs. We will not export our system of society and development model, and even more will not impose our views on others,” Xi said.

In advancing the Belt and Road initiative, Xi also said they would not retread the old path of games between foes but instead create “a new model of cooperation and mutual benefit.”

Xi said the new Silk Road would be open to all, including Africa and the Americas, which are not situated on the traditional Silk Road.

“No matter if they are from Asia and Europe, or Africa or the Americas, they are all cooperative partners in building the Belt and Road.”

Some of China’s most reliable allies and partners are present in the forum, including Russian President Vladimir Putin, Pakistani Prime Minister Nawaz Sharif, Cambodian Prime Minister Hun Sen and Kazakh President Nursultan Nazarbayev.

There are also several European leaders attending, including the prime ministers of Spain, Italy, Greece and Hungary.

Washington is being represented by a junior delegation led by Matt Pottinger, special assistant to the president and senior director for East Asia at the National Security Council.

Phl to benefit

There was no word from Malacañang yet as to why Duterte skipped the opening ceremony at the China National Convention Center in the Beijing Olympic Park.

Duterte arrived here past 11 p.m. last Saturday from Hong Kong.

Prior to this, he also attended the World Economic Forum (WEF) for the ASEAN in Phnom Penh, Cambodia.

While Duterte was absent, members of the delegation attended the events during the first day of the forum.

Sought for comment on how China’s promise to pour in billions of dollars for projects under the One Belt, One Road initiative could help developing countries like the Philippines, Trade Secretary Ramon Lopez said this could be through enhanced trade and more investments going to the Philippines.

“With us, it’s about the support in infrastructure development, promoting also trade… controlling trade disparities,” Lopez said.

“They try to encourage more exports from our end… and that we’ve seen in recent months when we signed agreements where they… not only committed to buy but issued purchase orders on agricultural products… And even non-agriculture products,” Lopez added.

With Duterte opening the door for bilateral relations with China last year, Lopez said the country is already benefitting from Beijing’s aid and assistance worth $24 billion.

“And then of course, we’ve been working on their investments into the Philippines,” he said.

According to Lopez, China’s One Belt, One Road Initiative is about reviving ancient cooperation, not only with nearby countries but also the nearby continents.

“So, it’s really trying to build stronger economic ties as well as people-to-people exchanges, policy, connectivity, also physical infrastructure, finance, trade, investments,” Lopez said.

“They are trying to revive that principle of peace, prosperity and development in all these other continents. They believe that in pursuing peace and cooperation, it’s really working on promoting prosperity, benefits,” the trade secretary added.

Sen. Sherwin Gatchalian, chairman of the Senate committee on economic affairs, said China’s initiative would open doors for new markets for the Philippines and that Duterte was correct in exploring it.

“More than that, ‘One Belt, One Road’ is a vision to democratize wealth and progress among developing nations. It is the type of plan that can transform a developing country into a developed one in the span of only one generation. Participating in this initiative is the right move for the Philippines,” Gatchalian said. –With AP, Paolo Romero