ASEAN needs more Belt and Road money, say ministers

In early September, ministers from ASEAN met virtually at the 2021 Belt and Road Summit. Discussing the goal of economic recovery from the COVID-19 pandemic, ministers from various Southeast Asian countries applauded the digital and physical infrastructure built through China’s Belt and Road Initiative throughout the region. Sansern Samalap, Thailand’s Vice Minister for Commerce, specifically pointed out the $5.75 billion high-speed railway that will eventually connect Bangkok to Kunming (Yunnan Province) through Nakhon Ratchasima and Vientiane, saying “Investors can grab this business opportunity and use Thailand as the gateway into the subregion and ASEAN.” Similarly, in 2019, Singapore and China launched a 260 Gbps data channel connecting the city state to Chongqing, increasing the economic link—especially in terms of digital and physical trade—between the two nations. Indonesia’s Vice Minister for Trade similarly said that the country has benefited from increased connectivity courtesy of Belt and Road investments, and in an interview with Chinese state media, Cambodia’s chief government spokesperson specifically pointed to Chinese projects—including a new expressway, airport, and power plant—as key forces in stabilizing the economy during the pandemic and “boost[ing it] … in the post-pandemic era.”

Xi Jinping launched the Belt and Road Initiative in 2013 with the goal of further connecting China to the rest of the world in terms of natural resources, energy, trade, communication, and co-operation. Southeast Asian countries have been one of China’s key partners and in addition to the projects previously mentioned, the Belt and Road Initiative has invested in ports, bridges, and industrial zones. China and its Southeast Asian partners show no signs of slowing down. At the Belt and Road Summit, the ministers encouraged the idea of further Chinese investment, not to mention a second mid-September ASEAN conference including both China and the US where they planned to further collaborate on “digital transformation” and the “digital economy.”

While the Belt and Road Initiative has tangible benefits for its Southeast Asian partners—the countries need infrastructure and investment to achieve their growth goals—China is not putting down trillions of dollars merely out of the good of its heart. The Council on Foreign Relations describes the Initiative as “central to the [CCP’s] legitimacy and political future” and “imperative … [in] creating external demand for Chinese firms” as the country’s economic growth begins to slow down. In other words, with the Initiative, China is looking to gain allies and find greater markets in Southeast Asia. However, as seen in Nigeria, one of the Initiative’s focuses pre-pandemic, Chinese imports have reduced demand for domestic production—destroying local industry—and created a significant level of debt owed back to China. The CCP has increased their focus on Southeast Asia in the wake of the pandemic and it is yet to be seen whether Thailand, Cambodia, and Indonesia (among many other countries) will come to benefit more than the Initiative may reap from them.