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China Set to Spend Billions on ‘One Belt One Road,’ But Some Want Focus on Poverty

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A worker works on the electrified light rail transit construction site in Ethiopia's capital Addis Ababa,
A worker works on the electrified light rail transit construction site in Ethiopia's capital Addis Ababa, Dec. 16, 2014. The project, built by China Railway Engineering Corporation (CREC) and mostly financed through a loan from China's Exim Bank. VOA

Running 1,300 kilometers over the world’s highest mountain pass, the “Friendship,” or the Karakoram, Highway is evidence of China’s willingness to spend big as a contributor to global development. Costing tens of billions of dollars, the road links western China with Pakistan, part of Beijing’s “One Belt One Road” Initiative, which seeks to rekindle ancient Silk Road trade routes linking China with Europe and Africa and is a central tenet of President Xi Jinping’s leadership, said professor Steve Tsang of London’s School of Oriental and African Studies.

“The government is committed to do whatever it can to make sure that it is successful,” Tsang said. “So a lot more money and resources will be put into it to support that.”

But figures show that since the Karakoram Highway was built, Pakistani exports to China have fallen while imports have increased, raising concern China’s new Silk Road could become a one-way street.

Address poverty

Stephen Gelb of the Overseas Development Institute says Beijing should focus its investments on global development goals.

“At the moment there’s a lot of focus on infrastructure and particularly transport, pipelines, that sort of thing, which don’t directly address poverty,” Gelb said. “And in fact there’s been in some cases some controversy about the social and environmental impacts. But I think the focus should be to address development, including poverty and related issues.”

Gliding above the choking traffic of the Ethiopian capital, Addis Ababa, the Chinese-funded tramway system opened last year at a cost of half a billion dollars. Beijing says investments like this will boost African economies, thereby alleviating poverty.

Gelb says it is also part of China’s plan to become a dominant force on the global stage.

“It was affirmed in Xi Jinping’s speech (this week to China’s Communist Party Congress),” he said, “China’s very much about these days rules-based global governance, multilateralism, globalization.”

Visiting India this week, U.S. Secretary of State Rex Tillerson accused China of not always playing by those rules.

“China, while rising alongside India, has done so less responsibly, at times undermining the international, rules-based order,” Tillerson said.

Chinese President Xi Jinping
Chinese President Xi Jinping toasts during a reception at the Great Hall of the People on the eve of the Oct. 1 National Day holiday in Beijing. VOA

Paying the piper

Recipient countries have welcomed Chinese investment, which sometimes comes with fewer conditions than Western aid, such as demands for democratic reform. But Tsang warns there could be a sting in the tail.

“The real issue will come when some of those countries, particularly in central Asia, have to pay back some of the loans that were acquired in the Belt and Road Initiative,” Tsang said. “And most of those countries will have problems paying back those loans.”

For now, Chinese investment continues to expand. Development campaigners say Beijing’s focus should be not only on ports and pipelines but on tackling poverty.(VOA)

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Gwadar Port: China Turning Pakistan Port Into Regional Giant

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A Pakistani soldier stands guard while a loaded Chinese ship
A Pakistani soldier stands guard while a loaded Chinese ship prepares to depart Gwadar port, about 700 kilometers (435 miles) west of Karachi. Pakistan. VOA

An unprecedented Chinese financial and construction effort is rapidly developing Pakistan’s strategically located Arabian Sea Gwadar port into one of the world’s largest transit and transshipment cargo facilities.

The deepwater port lies at the convergence of three of the most commercially important regions of the world, the oil-rich Middle East, Central Asia, and South Asia.

Beijing is developing Gwadar as part of the China-Pakistan Economic Corridor, known as CPEC. The two countries launched the 15-year joint mega project in 2015 when President Xi Jinping visited Islamabad.

Under the cooperation deal construction or improvement of highways, railways, pipelines, power plants, communications and industrial zones are underway in Pakistan with an initially estimated Chinese investment of $46 billion.

The aim is to link Gwadar port to landlocked western China, including its Muslim-majority Xinjiang region, giving it access to a shorter and secure route through Pakistan to global trade. The port will also provide the shortest route to landlocked Central Asian countries, including Afghanistan, through transit trade and offer transshipment facilities.

Chinese fuel imports and trading cargo will be loaded on trucks and ferried to and from Xinjiang through the Karakoram Highway, snaking past snow-capped peaks in northern Pakistan.

A general view of the port
A general view of the port before the inauguration of the China Pakistan Economic Corridor port in Gwadar, Pakistan. VOA

‘Qualitative change’

Gwadar will be able to handle about one million tons of cargo annually by the end of the year. Officials anticipate that with expansion plans underway, the port will become South Asia’s biggest shipping center within five years, with a yearly capacity of handling 13-million tons of cargo. And by 2030, they say, it will be capable of handling up to 400-million tons of cargo annually.

China has in recent months begun calling CPEC the flagship project of its global Belt and Road Initiative, or BRI. The “qualitative change” from an experimental project to flagship project underscores the importance Beijing attaches to CPEC, said Zhao Lijian, the deputy chief of mission at the Chinese embassy in Islamabad.

Out of 39 “early harvest” projects under CPEC, 19 have since been completed or are under construction with a Chinese investment of about $18.5 billion, Lijian told VOA. The progress makes it the fastest developing of all of at least six BRI’s corridors China plans to establish, added the Chinese diplomat.(VOA)