Chapters
Xi’s vision

Path to prosperity

Xi Jinping’s pan-Asian development initiatives, like the Belt and Road projects and AIIB, will benefit the region

P1 prosperity

By KARL WILSON in Sydney
karlwilson@chinadailyapac.com

The vision spelled out by Xi Jinping, general secretary of the Communist Party of China, at the Party’s 19th National Congress, will have a wide-ranging impact both domestically and across the Asian region.

The Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era emphasized China’s Two Centenary Goals — to build a moderately prosperous society in all respects by 2020, and build a modern socialist country that is prosperous, strong, democratic, culturally advanced and harmonious by the middle of this century.

Xi, who is also president, has stressed China’s commitment to innovation, free trade, globalization, the Belt and Road Initiative, the environment and a solid domestic reform agenda.

Two important meetings this month — of the 21-nation Asia-Pacific Economic Cooperation (APEC) forum and the 10-nation Association of Southeast Asian Nations (ASEAN) — may give further indications about how China now plans to proceed, regionally and internationally, given the fact that the United States has turned its back on free trade and climate change.

The APEC summit will be held in the Vietnamese port city of Da Nang on Nov 11-12. The 31st ASEAN summit and related meetings will be held in Manila from Nov 10-14, and the associated East Asian Summit (EAS) in Angeles City, north of Manila, on Nov 13-14.

The EAS comprises leaders of ASEAN and those from Australia, China, India, Japan, New Zealand, South Korea, Russia and the US. The summit could also be a plus for China diplomatically as US President Donald Trump will skip the EAS due to “scheduling reasons”.

While ASEAN, in this 50th year since its founding, will use the summit to promote the bloc’s achievements, the theme for ASEAN 2017 is Partnering for Change, Engaging the World.

Analysts expect China will stress its commitment to free trade and globalization, which are likely to be major discussion topics at the summits, especially the EAS. They also expect the reemergence of the China-backed Regional Comprehensive Economic Partnership agreement.

“On the international stage, I think you will find China will play a very cautious role, especially on those issues the US has been so vocal on, such as free trade and the Paris climate agreement,” said Hans Hendrischke, professor of Chinese business and management at the University of Sydney Business School.

He said Xi’s “new era” of Chinese development and economic growth is defined by the reform agenda he first laid out in 2012 at the 18th Party Congress.

President Xi Jinping speaks during a news conference at the Belt and Road Forum in Beijing on May 15. The Belt and Road Initiative holds potentially hundreds of billions of investment dollars for the region. AFP

Pushan Dutt, professor of economics and political science at INSEAD in Singapore, said: “We should also keep in mind that in this new world, with a rising China, and an inward-looking US, free trade agreements are no longer about trade per se. Rather, they are also about geopolitics.

“With the US canceling the Trans-Pacific Partnership, hinting that it may pull out of the South Korean free trade agreement, and even showing skepticism with the World Trade Organization, there is a leadership vacuum where others can step in.”

Hendrischke said on international issues such as climate change, China will stay in line with the rest of the world, “but it will now pursue the (Belt and Road) policy with greater enthusiasm”.

Under Xi’s leadership, the last five years have seen such pan-Asian projects as the Asian Infrastructure Investment Bank (AIIB) and the Belt and Road Initiative come into being.

The Belt and Road Initiative is China’s ambitious trillion-dollar infrastructure plan to improve transport and trade links across the ancient Silk Road routes that straddled Asia, Europe and Africa. Much of the project is now well advanced.

Companies like China Merchants Port Holdings and China COSCO Shipping Corporation have spent billions of dollars buying ports along the initiative’s maritime route.

Chinese companies are building a major industrial zone in Duqm, south of Muscat, in Oman.

In May, two Chinese companies signed a contract with Kazakhstan’s national railway company to buy 49 percent of an inland dry port near the China-Kazakhstan border.

Under the deal, COSCO Shipping and Jiangsu Lianyungang Port Co will each hold 24.5 percent of the dry port located in the Khorgos-East Gate Special Economic Zone, according to a statement by COSCO Shipping.

The dry port — on the border of the two countries — is about 15 km from the Khorgos port in Northwest China’s Xinjiang Uygur autonomous region. From the port, railway cargo can reach Lianyungang in East China’s Jiangsu province in five days and reach Europe in about 10 days.

Railways, roads, logistics and other infrastructure are being built at breakneck speed.

The AIIB was a landmark development in Asian economic regionalism, said Jeffrey Wilson, research fellow at the Perth USAsia Centre, University of Western Australia.

Formally launched by Xi on Jan 17, 2016, the AIIB is arguably the most significant economic institution to be established in the region for more than a decade.

He said the AIIB’s core mission is to help fill infrastructure gaps — the underdeveloped transport, energy and communication links which many say is holding back Asia’s economic potential — by providing a new development bank that specializes in infrastructure.

According to the bank’s website, as of Oct 31 it had $3.49 billion in loans; approved 21 projects; and has 58 members, with another 22 prospective members.

With the foundations already in place, China can now move forward.

Professor James Laurenceson, deputy director of the Australia-China Relations Institute at the University of Technology Sydney, said China is now providing around 30-35 percent of world GDP growth.

“It is fair to say Xi intends for growth in China to remain robust. If that intention can be delivered, that’s an enormous ongoing contribution to the global outlook,” Laurenceson said.

NUMBERS

In a recent commentary, Pauline Loong, managing director of Hong Kong-based research consultancy Asia-analytica, said the Belt and Road Initiative — with its promise of potentially hundreds of billions of investment dollars for the region – is a “hugely ambitious undertaking” targeting more than 30 percent of global trade and GDP.

The Silk Road Fund, a dedicated lender for Belt and Road projects, was set up by China with a $40 billion commitment at end-2014. The fund has already invested $6 billion in 15 projects and has separately contributed $2 billion to a China-Kazakhstan fund with similar goals.

Given ASEAN’s economic and strategic importance to China, and its geographical proximity, the Southeast Asia region features strongly in China’s plans for expanding overseas infrastructure financing.

Since ASEAN needs huge capital to realize its Master Plan on Connectivity, the Belt and Road Initiative, supported by the AIIB and the Silk Road Fund, will provide great benefits to ASEAN, according to Suos Yara, vice-chairman of the Cambodian National Assembly’s Foreign Affairs Commission.

Speaking at a recent symposium on the initiative in the Cambodia capital Phnom Penh, he said: “China has been playing a very active role in building and upgrading physical infrastructure in the region through many initiatives, especially the Belt and Road Initiative.”

A recent report by the United Nations Conference on Trade and Development showed that ASEAN will need infrastructure investment of $60 billion to $146 billion each year until 2025.

China’s policy banks are also formally supporting the Belt and Road Initiative — with two lenders pledging $55 billion in support of its deals, said Asia-analytica’s Loong, who is also a senior fellow with the CIMB ASEAN Research Institute with a special focus on ASEAN-China relations.

She said China’s State-owned enterprises (SOEs) are already actively involved in the initiative.

The chairman of the State-owned Assets Supervision and Administration Commission of the State Council, which oversees China’s SOEs, disclosed in May that 47 central government-owned SOEs are involved in 1,676 projects in Belt and Road countries.

Positive China role in global affairs grows Xi expounds concept to build a world community with ‘shared future’ of common prosperity

By AN BAIJIE
anbaijie@chinadaily.com.cn

Among the new diplomatic concepts, thoughts and strategies put forward by President Xi Jinping, the idea of building a community with a shared future for mankind is a key contribution.

The concept has become the theme of a major chapter that Xi addressed in the report he delivered at the 19th National Congress of the Communist Party of China (CPC) on Oct 18.

“We call on the people of all countries to work together to build a community with a shared future for mankind, to build an open, inclusive, clean and beautiful world that enjoys lasting peace, universal security and common prosperity,” Xi, also general secretary of the CPC Central Committee, told the more than 2,000 delegates.

He added that China will continue to play its part as a major and responsible country, take an active part in reforming and developing the global governance system, and keep contributing Chinese wisdom and strength to global governance.

Xi used a vivid description of how the international community can use its combined efforts to tackle a range of problems. The comments built upon Xi’s keynote speech at the United Nations in Geneva in January, when he spoke of China’s approach to solving problems.

“When I first got a Swiss Army knife, I was amazed that it had so many functions. I cannot help thinking how wonderful it would be if an exquisite Swiss Army knife could be made for our world,” he told the audience in Switzerland.

“When there is a problem, we can use one of the tools on the knife to fix it. I believe that with the unremitting efforts of the international community, such a knife can be made,” he added, calling for joint efforts to build a “community of shared future for mankind”, something he first mentioned at a September 2015 UN summit in New York, where he proposed a road map for building the proposed community.

A month later, Xi’s concept was incorporated in a UN Security Council resolution for the first time.

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This sort of proposal embodies Xi’s and China’s diplomatic framework during the past five years that has offered Chinese solutions to global challenges.

Foreign Minister Wang Yi said the president has stressed that China must pursue “major-country diplomacy” with its own characteristics, which “must illustrate salient Chinese features, a Chinese style and Chinese confidence”.

“In a different way from traditional major countries, China is striding toward the center of the world stage with more confidence and openness. While building an external environment conducive to its own development, it is also making increasingly significant contributions to world peace and development, as well as the prosperity and advancement of all humankind,” Wang said in a documentary aired by China Central Television in September.

Ruan Zongze, executive vice-president of the China Institute of International Studies, said the pursuit of major-country diplomacy meets the demands of both China and the world, as the Chinese and global economies now rely upon each other to an unprecedentedly high level.

“The international community expects that China, as the world’s second-largest economy, can raise solutions to major global issues, and at the same time also needs to boost interaction with the world,” he said.

At the G20 Summit in Hangzhou in September last year, Xi emphasized the concepts of equality, openness, cooperation and sharing in global economic governance.

Against the backdrop of a trend for deglobalization and sluggish growth around the world, China proposed building an innovative, open, interconnected and inclusive global economy.

Data released by the National Bureau of Statistics on Oct 10 show that China’s average contribution to world growth from 2013 to 2016 was about 30 percent, the largest among all countries and higher than the total contribution from the United States, the eurozone and Japan.

In the past five years, measures, proposals and concepts put forward by China have injected vigor into the reform and optimization of global governance. China proposed establishing the Asian Infrastructure Investment Bank and the New Development Bank.

Last year, the International Monetary Fund included the Chinese currency, the renminbi, in the special drawing rights basket.

In his January speech at the UN, Xi pledged to pursue a win-win strategy of opening up, sharing China’s development opportunities with other countries and welcoming them “aboard the fast train of China’s development”.

“China’s development has been possible because of the world, and China has contributed to the world’s development,” he said.

In the next five years, China will import $8 trillion worth of goods, attract $600 billion in foreign investment and provide $750 billion in outbound investment, he said, adding that Chinese tourists will make 700 million visits overseas.

According to Xi, from 1950 to 2016, China provided foreign countries with aid worth more than 400 billion yuan ($60 billion).

By Sept 25, 74 countries and international organizations had signed agreements with China to boost Belt and Road cooperation.

In March, the UN Security Council for the first time incorporated the Belt and Road Initiative in a resolution, calling on all parties to actively participate in regional connectivity and economic cooperation programs such as the Belt and Road.

The initiative, proposed by Xi in 2013, aims to build the Silk Road Economic Belt and the 21st Century Maritime Silk Road through the concerted efforts of all related countries to benefit all participants by promoting unimpeded trade, financial integration, infrastructure connectivity and closer people-to-people exchanges.

China has actively assumed its international responsibilities and participated in global governance by putting forward new concepts, thoughts and plans to reshape the global governance system, according to Jin Yong, a professor of international relations at the Communication University of China.

The initiative’s spirit of peace and cooperation, openness and inclusiveness, mutual learning and mutual benefit has injected new momentum into global governance, he said.

On Sept 22, China’s Foreign Ministry and the UN Department of Economic and Social Affairs signed a memorandum of understanding to help build capacities for developing countries involved in the initiative.

By Sept 25, 74 countries and international organizations had signed agreements with China to boost Belt and Road cooperation.

“I am convinced that the Belt and Road Initiative will serve as a new platform for all countries to achieve win-win cooperation and that it will create new opportunities for implementing the (United Nations) 2030 Agenda for Sustainable Development,” Xi said while delivering the keynote speech at the opening ceremony of the BRICS Business Forum in the coastal city of Xiamen, East China’s Fujian province, in September. BRICS is an association of the five emerging economies of Brazil, Russia, India, China and South Africa.

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