Belt and Road Initiative

As part of its effort to position itself as a global health leader in the COVID-19 pandemic, China has resurrected the “Health Silk Road” moniker, suggesting that the concept may take on new importance.

As the coronavirus disease 2019 (COVID-19) pandemic spreads worldwide, the public health crisis and response will lay bare China’s leadership aspirations as a great power. It is too soon to say precisely how the pandemic will change the broad contours of Chinese foreign policy, but it has already highlighted some of the frailties of the Belt and Road Initiative (BRI)—Xi Jinping’s signature foreign policy agenda to build traditional and digital infrastructure around the world. China has constructed its loosely-governed, $1 trillion infrastructure initiative to ensure that Beijing reaps many of the benefits, but this structure of governance has also created significant foreign dependencies upon China. Most BRI infrastructure contracts are given to Chinese companies, most projects rely overwhelmingly on Chinese labor and supplies, and BRI depends on the availability of massive amounts of cheap credit from Chinese banks. In becoming the epicenter of a global public health crisis with far-reaching economic consequences, China has also revealed the inherent vulnerabilities of an international initiative that is governed through its reliance on Beijing. After attempting to bury early news of the virus for the sake of regime legitimacy, by February the Chinese Communist Party turned to a series of severe measures to control the virus’ spread. It halted international travel, quarantined cities, and imposed lockdowns across the country. The effects sent shockwaves both through the Chinese economy and internationally, with many countries facing ramifications from a Chinese slowdown. By restricting personal movements, public events, and business activities, hundreds of millions of people were unable to complete their daily routines. Today, as transmission of the virus begins to slow in China, Chinese people are beginning to return to work. Quarantines, lockdowns, and a ban on international travel for Chinese citizens may have been effective in slowing the spread of the coronavirus. But China’s COVID-19 response all but halted the Belt and Road Initiative in its tracks. Work ceased along the China-Pakistan Economic Corridor, Cambodia’s Sihanoukville Special Economic Zone came to standstill, and projects across Indonesia, Myanmar, and Malaysia became stuck in holding patterns. A freeze on the flow of Chinese labor is a significant factor in these disruptions, with thousands of Chinese workers unable to return to their country of work. China has repatriated citizens working in Iran, for example, due to the spread of COVID-19 there—a measure it could apply to any BRI host country badly afflicted with the spread of the coronavirus, and one which will grind other BRI projects to a halt. At the recipient country level, more than 130 countries around the world have placed entry restrictions on Chinese citizens of individuals traveling from China. The Chinese government has lobbied BRI countries, including the Solomon Islands and Pakistan, to ease these travel restrictions. The longer that Chinese workers are unable to return to projects overseas, the longer the projects will languish incomplete, and some may be abandoned altogether (a phenomenon not unheard of, even within BRI’s short track record). The COVID-19 crisis has also hampered China’s manufacturing supply chains, and BRI projects are predominantly reliant on Chinese, rather than local, materials and supplies. The pandemic has compromised the global supply chains that keep BRI projects moving forward, limiting the goods flowing  out of China to the point that China actually ran a trade deficit during the first two months of the year. China’s shuttered factories not only need workers to be released from quarantines to resume normal output, but also need restored supplies of raw materials, adequate stores of protective gear for workers, and active truckers and shipping ports to deliver their goods abroad. The global shipping industry was slowed to the point that more tonnage of container ships was idled around the world in February than during the worst points of the 2008 financial crisis. Today, about 60 percent of China’s small and medium-size companies have resumed operations. The pace at which BRI projects and their supply chains come back online will depend on the effectiveness of China’s containment of the virus and as well as the speed its broader economic recovery. Moreover, China is facing down the COVID-19 public health challenge with its economy slowing to the lowest rates in three decades. Due to contractions in both industrial production and services production, it is estimated that China’s GDP shrunk by 13 percent during January and February. To help mitigate these effects, China’s State Council last week announced it will set up a coordinating mechanism for ministries to help businesses overcome supply chain bottlenecks, alongside other government support. Rumors recently surfaced that the Chinese government may be planning a massive stimulus package to revive the economy (though as others have noted there is some reason to be skeptical). Additionally, the China Development Bank has pledged to support coronavirus-hit BRI-related companies, although it is not clear if this support will be made available to Chinese companies only, or foreign firms as well. China will likely continue to face significant tradeoffs between public spending on domestic health and economic recovery and its financial subsidies for BRI in its response to the crisis. While it will take months to learn the full effects of COVID-19 for China’s economy, and the Chinese government is clearly working to offset them, COVID-19’s broader economic reverberations may themselves constrain BRI. Meanwhile, the Chinese government is clearly trying to bolster its own global governance role by establishing itself as a counter-COVID leader in word and deed. CCP officials are working to shift the global narrative surrounding their delayed and often-harsh response to the outbreak by championing its eventual (and tenuous) success. China is even beginning to provide material aid to BRI countries afflicted by the pandemic, including to Italy where in a recent call between foreign ministers China announced plans to sell Italy ventilators, masks, protective gear, and test kits. This week China made a similar pledge of medical support to Spain. If Beijing is remembered not primarily for its initial cover-up and harsh containment tactics, but as a source of eventual pandemic support, this will surely change the way that BRI countries see the wisdom of working closely with and relying on China. It is far too soon to know, however, the extent to which many BRI countries themselves will be affected by the pandemic. Some BRI-participating developing countries are currently reporting relatively few COVID-19 cases, but this is likely due to a lack of testing and other forms of detection. Those with weaker healthcare systems—such Myanmar or Nigeria—may come under enormous strain, and may be far less able to put in place the types of virus-containment measures that China did, (much less replicate the successes of democratic South Korea or Taiwan) including widespread testing, quarantining, and extensive social distancing. Less-developed countries may also experience grievous economic effects of their own, which may in turn constrain their ability to service BRI-related debt later. If BRI were based on a different model of governance, however—centered on locally sourcing workers, suppliers, and manufacturers, engaging international infrastructure-building experts, and focusing on building local capacity—these shocks would almost certainly be differently felt. It may take months to see the ramifications of COVID-19 unfold in BRI countries, and as a result it is too soon to tell how perceptions of China and its global governance leadership will be reshaped. The answer will no doubt vary across cases, but it is highly unlikely that BRI will be the same initiative by this time next year.

The planned summit between representatives from the ten countries in the Association of Southeast Asian Nations (ASEAN) and U.S. President Donald J. Trump in Las Vegas has been postponed, because of the coronavirus threat. The summit was supposed to be a sign that the administration is not ignoring Southeast Asia. Postponing it right now makes sense. But even with a summit, the administration cannot paper over ASEAN’s internal problems or the tensions between ASEAN and the United States. Many Southeast Asian leaders have become so wary of the White House’s unreliability that they have reluctantly embraced China. The administration has proclaimed that the Indo-Pacific region is a top priority, but last autumn the administration sent a relatively low-level delegation to the U.S.-ASEAN summit in Bangkok. A recent survey of regional opinion leaders by Singaporean think tank ISEAS-Yusof Ishak Institute found Southeast Asians trust China less than the United States or Japan. Yet the survey showed that, if forced to choose, 70 percent of Southeast Asians would align with Beijing rather than Washington. Whenever the meeting is actually held, the White House will emphasize how ASEAN fits into its “Free and Open Indo Pacific” vision, which focuses on promoting fair and reciprocal trade, supporting regional institutions including ASEAN, protecting sovereignty, and promoting good governance, among other priorities. Trump will likely emphasize how the administration has stood up for these concepts, including by conducting more freedom of navigation patrols in the South China Sea and launching new governance initiatives in places like Myanmar. The administration also will outline U.S. economic alternatives to China’s Belt and Road Initiative (BRI). One U.S. response is the nascent Blue Dot Network, a plan for governments, civil societies, and private sectors to create a set of high standards for infrastructure projects. This higher-quality infrastructure would supposedly contrast with the BRI, which administration officials claim supports poor-quality infrastructure and traps countries in debt (a debatable argument). Some White House policies are relatively popular in Southeast Asia. Frustrated with China’s influence activities and militarization in the South China Sea, countries such as Singapore and Vietnam have mostly welcomed the Free and Open Indo-Pacific idea, which resists Beijing’s encroachment on other states’ territorial waters and meddling in other societies. Yet other mainland Southeast Asian states care less about the South China Sea. And the Philippines, a U.S. treaty ally, has shifted toward China’s orbit. The Trump administration has had little success convincing regional states that it has an alternative to the BRI or an effective trade policy. And Many Southeast Asian states still welcome the massive infrastructure funding BRI can provide, seeing Blue Dot and other U.S. initiatives as limited, in terms of actual aid amounts, compared to BRI. Beijing has launched prominent BRI projects in Malaysia, Myanmar, the Philippines, Thailand, and other Southeast Asian states. And ASEAN is faltering on its own, limiting what it could accomplish with any partner. ASEAN members cannot agree on how to handle long-term issues, such as Beijing’s South China Sea policy or climate change, which could place much of Southeast Asia underwater by 2050. ASEAN’s structure, in which major decisions are made consensus, enables this disunity. Even on pressing short-term issues, including the coronavirus and the Rohingya crisis in Myanmar, ASEAN usually punts. When the Rohingya crisis accelerated in 2017, with the Myanmar security forces reportedly committing ethnic cleansing, ASEAN could only agree to provide some minimal relief for refugees, whitewashing abuses facilitated by Myanmar’s government. Since the prospect of ASEAN changing how it operates remains miniscule, and the Trump administration prefers to deal with states bilaterally, ASEAN is likely to be even more marginalized in the coming years—whether or not a summit is eventually held.

Last week I took part in a debate at CSIS on the topic of whether China seeks to export its development model.  For me, the answer to this question is self-evident: of course it does. Yet as I prepared for the debate, I quickly realized that many thoughtful colleagues have argued the opposite. So, in the interest of spurring further discussion and debate, I thought I would lay out in written form the why’s and wherefore’s of my case. (There is significant disagreement around what, precisely, constitutes the China model, but in this debate, the China model was broadly understood as a variant of authoritarian capitalism.) To begin with, China seeks to export its development model because Xi Jinping wants to do so. In numerous speeches, beginning at least at the 19th Party Congress in October 2017, Xi has reiterated his belief that “[China] offers a new option for other countries and nations who want to speed up their development while preserving their independence.” While Xi did backtrack temporarily in the face of international backlash, once stating that China was not seeking to export its model, he quickly reverted to form with more statements to the effect that China has a model worthy of emulation. Then there is the issue of how Beijing exports its model. Much of the export of the model occurs through the training of foreign officials—both in and outside China. Just last month, Zhejiang province hosted a forum called “The Significance of China’s Social Governance to the World,” which was attended by more than 200 experts from 20 countries. The Xinhua tagline from the conference was “China can provide wisdom to a world that is in need of new governance models.” In Guangxi province, there is a beautiful new leadership academy established in 2017 to train officials from ASEAN on China’s governance and economic development model. Subjects taught at the academy include how government officials can guide online public opinion, alleviate poverty, and develop a stronger grassroots presence. There are also highly targeted efforts by Chinese officials to export their model. My colleague Josh Kurlantzick has documented the many ways in which Chinese officials train their counterparts in Cambodia, for example, on what tools to use to suppress dissent and how to encourage foreign investment, while at the same time accessing and retaining foreign technology and skills. Stimson Center expert Yun Sun has similarly illuminated Chinese training efforts in Ethiopia and Sudan, around issues such as party organizational structure, propaganda, guiding and managing public opinion, and poverty alleviation. On the political front, much of the effort is devoted to exporting elements of the model dedicated to state control over civil society. Beijing hosts two to three-week seminars on how to conduct online censorship and surveillance for officials from other countries, such as the Philippines, Saudi Arabia, the UAE, and Thailand. After a joint China-Tanzania roundtable on new media, the Tanzanian deputy Minister of Communications Edwin Ngonyani discussed collaborating with China on social media censorship, noting “Our Chinese friends have managed to block such media in their country and replaced them with homegrown sites that are safe, constructive and popular. We aren’t there yet, but while we are still using these platforms we should guard against their misuse.” Tanzania, Zimbabwe, and Vietnam have all reportedly modelled their cybersecurity laws after that of China. China, moreover, is a full-service provider. In addition to offering the legal and institutional framework to enhance state control over society, it is also providing the technology to support it. At least 50 countries are developing Huawei-supported surveillance systems. While surveillance technologies can be important aids in reducing crime, it is also the case, as Latin America scholar R. Evan Ellis has noted, that these technologies will give authoritarian regimes “something that they have only dreamed about: a massive ability to sanction persons who engage in political or social behaviors the government disapproves.” China also exports the economic elements of its development model. Some efforts are intentional: for example, there are extensive training seminars on China’s poverty alleviation strategy, and Beijing has worked with many governments, particularly in Africa, to establish Chinese-inspired special economic zones to encourage manufacturing and exports (with mixed success). More broadly, however, both China’s 1999 go-out strategy to acquire natural resources and its current Belt and Road Initiative in effect reflect the wholesale export of China’s infrastructure-led economic growth model. Even the externalities of China’s development model are replicated: significant increases in infrastructure-induced government debt, a lack of transparency and engagement with civil society, corruption, and significant popular protest. In some cases, the China model merely reinforces similar proclivities in Belt and Road countries; in others, it introduces fundamentally new challenges and opportunities. In all cases, however, China exports its economic development model as part and parcel of how it does business and engages globally.     While the most visible impacts of China’s efforts to export its model occur within other countries, Beijing also exports its model via multilateral regimes and institutions, seeking to bring international norms and practices more in line with those of China. Center for American Progress scholar Melanie Hart has brilliantly delineated Beijing’s efforts in this regard in international regimes around human rights and Internet governance. As she notes, “China is seeking to devalue those external freedoms by pushing authoritarian principles in global internet governance forums. Just as China is convening its own human rights forums, it is also hosting World Internet Conferences that bring in representatives from other nations—including major U.S. companies—to legitimize Chinese norms.” Finally, there are cases where Beijing adopts a more coercive approach to try to persuade actors in other countries to conform to its model. For example, in 2015, the Chinese government kidnapped several booksellers from Hong Kong, including a Swedish citizen, to pressure them to stop selling books critical of the Chinese government. More recently, this past October, we witnessed the case of the Houston Rockets General Manager Daryl Morey, who tweeted, “Fight for Freedom, Stand with Hong Kong.” In response, Chinese companies cancelled all licensing deals for Rockets merchandise, and the Chinese government banned all CCTV broadcasts of NBA games and reportedly called on the NBA to fire Morey. Of course, China has on many occasions attempted to use economic leverage to force countries, companies, and individuals to align their political statements and actions with those of China. What is particularly revealing in this instance, however, is not the effort to use economic leverage to pressure the Houston Rockets and the NBA, but rather the statement by state-owned CCTV that “any remarks that challenge national sovereignty and social stability are not within the scope of freedom of speech.” There could not be a clearer demonstration that China seeks to export its political model than a statement to the effect that China has the right to apply the same standards of free speech it practices at home to actors abroad. During part of the Mao-era, in the late 1950s and 1960s, China promoted its revolution as a model for other third world countries. But it is not until now that the Chinese leadership has once again sought to export its model. Whether the export of this model is welcomed by others or not, whether it succeeds or fails, and whether we believe the impact to be benign or malign are second order questions. What matters in the first instance is that we recognize and acknowledge that China’s leaders believe they have a model worth exporting and are seeking to do so.  

Neil Edwards is the volunteer intern for CFR's Africa Program in Washington, DC. He is a master's candidate at the School of International Service at American University and is a returned Peace Corps Rwanda volunteer. Uganda is heading toward a debt crisis. According to a senior official at the Bank of Uganda, unless the country is able to sustain a growth rate of at least 7 percent—which economic projections show Uganda will not do—the country will default on its payments. As is the case for many African countries, China is Uganda’s largest creditor, making up 39 percent of total debt this past fiscal year. If Uganda defaults, it is unclear how China will react. Will China flex its muscles and negotiate for the rights to Uganda’s sovereign assets like it did in Sri Lanka, or ease the debt pressure, by restructuring Uganda’s loans over a longer time period as it did in Ethiopia?   Generally speaking, foreign governments and international financial institutions are hesitant to make loans to Uganda. They remain skeptical that Uganda will be able to honor them—except, apparently, China. Ugandan President Yoweri Museveni recently admitted that China is the only partner that would agree to lend Uganda, Tanzania, and Kenya $3.5 billion to construct a series of railways and roads. In addition, China is financing a $4 billion oil pipeline, currently under construction, that will connect the western region of Uganda to the port in Tanga, Tanzania—giving the landlocked country access to the Indian Ocean. Many of China’s loans to Sub-Saharan Africa can be seen in the context of China’s belt and road initiative.  China has reacted differently to each country’s individual debt crisis. At one end of the spectrum, China allegedly uses its leverage to gain strategic and material concessions if a debtor country is unable to pay their debts, exemplified by Sri Lanka handing over control of the Hambantota Port to China for ninety-nine years. China's alleged practice of debt-trap diplomacy, as it has been dubbed, has been hotly debated, though there seems to be a consensus that their lending practices are problematic. At the other end, China works with governments to restructure loans over a longer time period—often forgiving past interest payments—as illustrated by China’s twenty-year-loan extension to Ethiopia.  Completed in 2010, the Hambantota port did not draw enough ships to make the operations economically feasible. By July 2015, Sri Lanka could not service its payments. Consequently, in order to avoid defaulting on its debt, the government relinquished control of the port to China for nearly a century. Uganda’s auditor general report warns that the conditions of their loans similarly threaten the country’s sovereign assets. If the economic predictions hold and the country defaults on its payments to China, Uganda’s infrastructure projects might face a similar fate.  Ethiopia faces a similar debt crisis, linked in large part to the Chinese-financed, $4 billion Addis Ababa-Djibouti Railway. Opened in January 2018, the railway intended to expand Ethiopia’s export market by connecting its capital to the sea via Djibouti. But Ethiopia is importing more than it is exporting via the railway, not generating the revenue needed to service its debt to China. In response, China renegotiated the terms of the loan with Ethiopia to extend the payments over a longer period of time.  Based on China’s approach to Ethiopia and the similarity of its infrastructure projects connecting Uganda to the sea, it is more likely that China will work with Uganda to extend the repayment terms of the loans. There is speculation that China sought control of the Hambantota port because it is strategically important. According to some analysts, the port should be thought of as part of a string of pearls—China’s plan to have a line of ports stretching from Beijing to the Persian Gulf. Viewed this way, the Hambantota port is of much more strategic significance to China than Ethiopia’s and Uganda’s railways. Finally, internal and external criticism of China's lending practices are likely to encourage a more constructive approach to debtor countries.

With China promoting a model of state-led capitalism and political illiberalism, and digital technology playing an increasingly central role in all aspects of society, the United States should work with its allies to promote core liberal values and provide a positive model of technological development and digital connectivity.

A vast gulf remains between development financing and development goals. International competition could help bridge that gap, but has produced mixed results to date.

Xi Jinping’s signature project got a boost when Italy became the first major European country to join. What was behind Italy’s decision and what might it mean for the United States and other EU countries?

This is a guest post by Sophia Lian, intern for Energy and Climate Policy at the Council on Foreign Relations.  Since the collapse of the Soviet Union, Beijing and Moscow’s shared goal of reorienting the Western-dominated global order has led them to cooperate on many fronts, including energy infrastructure and institutional development.  Despite lingering mistrust, the two countries recognize their complementary strengths and have pushed forward in their opportunistic partnership. Much needed Chinese investment in Central Asia, the Russian Far East, and the Arctic will tap vast energy stores and provide institutional support in remote locales.  As Moscow keeps wary watch over increasing numbers of Chinese migrants in its backyard, Beijing is careful to alleviate concerns of encroachment by publicly deferring to Moscow’s leaders while highlighting regional benefits of Chinese investment. In securing a foothold in Russian territory through the eastern stretch of the Belt and Road Initiative (BRI), China is laying the groundwork for future geopolitical plays.  Strategically consolidating Chinese influence through economic development in the Russian Far East, Central Asia, and the Arctic aligns with President Xi Jinping’s more activist brand of foreign policy.  Based on one’s perspective, Beijing has already been treading a fine line between Russian collaborator and competitor. Chinese Collaboration in Russia’s Backyard: Russian Far East, Central Asia, and the Arctic The Russian Far East is a region of strategic importance and historical sensitivities.  This icy region abounds with natural resources and is the site of Russia’s only warm water Pacific port (Vladivostok).  Russia’s coveted possession of a Pacific outpost was realized in the late 19th century when it successfully compelled a weak China to sign over control of the region whose loss China has not gotten over. Against this historical backdrop, Russia has closely guarded its sparsely-populated eastern hinterland, and has until recently rebuffed Chinese business forays into the region.  However, the collapse of its relationship with the West over Ukraine has left Russia little choice but to turn to Beijing for finance and economic development assistance, and Russia’s moment of weakness is opportune for an energy-hungry China eager to diversify its energy sources and enhance its strategic positioning. Economic development has been quick to come to the Russian Far East.  Chinese capital now accounts for 45 percent of the total foreign investment in the regional capital, Khabarovsk.  A little ways south in the port city of Vladivostok, Chinese money has transformed the area into a tourist center, when only a few years earlier both far eastern cities lagged far behind their European Russian brethren.  Similarly, China has taken an interest in Central Asia as a potential hub for expanding Eurasian trade flows and has secured energy development, transport, and infrastructure projects as part of its BRI.  China claims its collaboration in the Arctic will help develop the region’s untouched bounty of natural resources.  In undertaking these projects, however, Beijing contends with Russian territoriality as the Kremlin is weary of privileged Chinese access to areas that could ultimately jeopardize Russian sovereignty. Chinese Accelerating Arms Exports, Development of Traditional and Nuclear Power, and Ownership of Critical Infrastructure Arms Exports: China’s consolidation of geopolitical assets through infrastructure investment extends to the Middle East, Africa, and Europe, which could challenge Russia’s traditional role as a major energy and arms supplier.  Russia’s economy and influence is highly dependent on its energy and arms exports, whose domain its southern “frenemy” has increasingly encroached upon.  While Russia has been developing new weapons systems, China is now poised to become a dominant arms exporter after decades of copying and appropriating Russian technology, and integrating such technology into both its defense and private tech industries.  Moscow’s economy is not as resilient in that its defense-driven economy cannot fall back on civilian demand like China’s economy can (through dual-use technologies).  China is gaining ground in countries with troubled human rights records and has recently been successful in arms sales to several African countries (e.g., Algeria, South Africa, Kenya, Cote d’Ivoire) in addition to continued large sales to regional buyers Pakistan and Afghanistan.  Development of Traditional and Nuclear Power: The Kremlin has made clear its aims to become a dominant energy power in the Middle East and has recently inked several business deals in the region.  But China is close behind, staking out Mideast energy deals, especially in Iran and Iraq.  The recently acquired 80.1% stake of the South Pars gas field (taking up a 50.1% stake from French energy giant Total, which is withdrawing because of U.S. sanctions) will mean China could become a natural gas exporter in competition with Russian firms Gazprom and Novatek. The competition is direct since Russia views its energy exports as not only a means to needed petrodollars but also as a geopolitical tool to build spheres of energy dependence. China emulates the same ends via its BRI, and more recently through its planned expansion into the nuclear energy export market. China is playing the long game in this regard, and its patience has paid off as the UK has recently given the green light for the Hinkley Point C power station of which an important piece of infrastructure is Chinese.  This is hugely significant as no western country has opened up their strategic infrastructure to a non-ally in this way. Britain’s approval, which brought consternation from the U.S., could jumpstart China’s reach to the rest of the world. Beijing envisions building 30 nuclear plants along its BRI path by 2030, and though Beijing and Moscow collaborate in developing nuclear technology, Russia is sure to chafe at China’s ambitions.  Chinese activity in nuclear power directly competes with Russian natural gas sales to Europe, as do energy associated with other Chinese sources, including wind farms, exports of solar panels, and eventually battery storage. Ownership of Critical Infrastructure: China is also buying other critical infrastructure in eastern and southern Europe and Greenland, further extending its reach to the west.  Deals worth at least $255 billion across the European continent have resulted in almost 360 companies having been taken over and China also is now partially or wholly owning at least four airports, six seaports, wind farms in at least nine countries, and thirteen professional soccer teams.  Last but not least, long considered the world’s largest rare earth producer, China has a chokehold on cheap access to these essential elements, and recently concluded an agreement aligning uranium and rare earth mining activities between the Greenlandic and Chinese governments, giving China almost exclusive control of this domain. Outward Collaboration Over the previous decades, China’s influence has strengthened to the point where it can now challenge traditional hegemons like Russia -- but for now, a partnership is still preferred.  Though Moscow is wary of the myriad Chinese projects being undertaken and of the increasing numbers of Chinese migrants in its backyard, it is currently managing its insecurities quietly since it recognizes the need for Chinese capital and manufacturing expertise to tap undeveloped resources and to build needed infrastructure, partly to counter its souring relations with the West.  The two countries have thus found common cause on a number of issues, from mutual diplomatic support on the UN Security Council, to military reinforcements and economic collaboration.  Naval exercises in the Sea of Japan, South China and Baltic Seas showcase solidarity in areas of tension with Washington.  Of course, these displays are meant to project a united image that is not so sanguine under the surface.  China has, over the years, avoided inconvenient entanglements and has demonstrated its utility as a source of capital, infrastructure, and arms.  Now, stronger and under more expansionist leadership, China’s reach is set to expand much farther afield under its ambitious BRI. For now, China appears willing to refrain from overt challenges to Russia, as Beijing’s immediate need for imported raw materials and desire to focus on its BRI ambitions requires a cooperative Russia. Beijing has tried to ease Moscow’s insecurities about perceived Chinese encroachment by promising economic benefits, and staying relatively respectful of Moscow’s Eurasian security interests while it focuses on economic and industrial development.  So far, the arrangement has worked for both parties and has even led to an interesting turn of events, where Chinese troops were invited to participate in the massive 2018 Vostok war games -- Russian military exercises historically meant to prepare for border confrontations with China.  It is unlikely that Russia suddenly considers its long-time adversary an ally, but the two will continue to outwardly collaborate until it is no longer in either’s interest to do so. Future increases in energy export and investment competition in Europe and beyond could be the first signs of strain in the uneasy relationship.  

Over the past year, Chinese officials reportedly have been surprised by how quickly the Trump administration has undermined U.S. influence in East Asia, creating a leadership void that could potentially be filled—by China. But even before Trump alienated many Asian partners with a mix of harsh trade rhetoric and a general disinterest in South and Southeast Asia, Beijing had launched a strategy to establish itself as the dominant power in its neighborhood. This strategy coincides with the rise of Xi Jinping, the most powerful Chinese leader since Mao, and a man with a desire to make China, shall we say, great again. While the Xi administration appears to have global ambitions, China has made South and Southeast Asia its current top priorities. Its efforts there could become a template for how Beijing will expand its influence worldwide. For more on how China is utilizing BRI to expand its influence in South and Southeast Asia—and possibly failing as well—see my new review, from which this first paragraph is excerpted, in the Washington Monthly of Will Doig’s book High-Speed Empire: Chinese Expansion and the Future of Southeast Asia.

Coauthored with Ashley Feng, research associate in the international institutions and global governance program at the Council on Foreign Relations. Given the hype surrounding China’s Belt and Road Initiative (BRI), one feature of the massive global infrastructure project has garnered less attention. Beijing aims to create a “digital Silk Road” that will allow it to shape the future of the global internet—and reinforce the Chinese Communist Party leadership at home for decades to come. Under the guise of BRI, China is seeking to export its policy of authoritarian cyber controls, giving countries the right to regulate and censor their own internet. China has already tightened control over its domestic internet, including through the Great Firewall and its Cybersecurity Law. It is now seeking to globalize that approach, while also inserting backdoor mechanisms that could increase its intelligence and propaganda operations in BRI partner countries. China’s plans—running directly counter to U.S. aspirations for a free and open global internet—should be deeply alarming to the United States. In March 2015, China’s National Development and Reform Commission (NDRC), Ministry of Foreign Affairs, and Ministry of Commerce jointly released the Belt and Road white paper, calling not only for improving infrastructure construction and technical standard systems, but also for “jointly improving the transparency of technical trade measures” and creating an “Information Silk Road,” or a digital Silk Road. As part of this initiative, the Chinese government calls for constructing cross-border optical cables and communications trunk line networks, planning transcontinental submarine optical cable projects, and improving spatial and satellite information passageways to expand information exchanges and cooperation. While the development of a digital Silk Road may seem innocuous, it raises critical human rights, commercial, security, and governance concerns. The idea of stricter internet controls is attractive to authoritarian-leaning governments, as the internet and social media have been essential in popular uprisings, such as the Arab Spring. Egypt, a regular violator of human rights, has drastically increased its use of internet censorship since 2011, shifting from selective filtering to pervasive blocking. Wary of dissenting opinions being expressed on the internet, China has sought to eliminate virtual private networks (VPNs), which allow its citizens to access websites blocked by the Great Firewall. Russia, another country that favors tighter internet controls, has been coordinating with China to incorporate the Great Firewall into the Red Web. China has also begun to implement its Cybersecurity Law, raising human rights and economic concerns. Under the law, companies must censor all prohibited information, restrict online anonymity, store users’ personal information in China, monitor and report on network security incidents, and provide technical support to security agencies in investigations, which could mean increased surveillance. The law also gives the Chinese government a legal basis for large-scale network shutdowns in response to “major public security incidents,” a category left intentionally vague and thus a recipe for abuse. Since the Cybersecurity Law went into effect in June 2017, censorship activity has reportedly increased by over 40 percent from the previous year. In August 2017, the Cyberspace Administration of China (CAC), the administrative and enforcement agency for the internet in China, sent a powerful message by issuing a notice saying that three of China’s largest technology companies—Tencent, Baidu, and Sina—had violated the law, allowing users to spread messages that “endanger national security, public security, and social order.” Individuals have also been arrested for private text messages on WeChat for “picking quarrels and provoking trouble,” a charge often used for those who have insulted the government. There have also been reports of China censoring WeChat outside of the country, demonstrating China’s ambitions to export its censorship regime internationally. Besides its human rights implications, the law also demands that data collected by critical infrastructure operators be stored within China’s borders (otherwise known as data localization), allows only government-approved encryption technologies, and requires companies to reveal source code for IT products sold to critical infrastructure operators. Data localization is not just costly for multinational corporations, forcing them to contract with local cloud service providers or to build their own data centers, but it also endangers individual privacy. Trade associations have also speculated that China is pushing data localization to secure “expansive access to private information, trade secrets, intellectual property, or internal business communications.” Data stored on domestic Chinese rather than foreign servers could also be much easier for the Chinese government to access. Vietnam has begun to learn from its northern neighbor, proposing a piece of legislation that has elements of China’s Cybersecurity Law. China’s drive for data localization is part and parcel of its broader ambition to dominate high-value technology, especially information and communications technology (ICT). As part of this campaign, China has developed unique national standards that it hopes to compel others to adopt globally, by leveraging its own large domestic market. In its quest to avoid the middle income trap, China also aims to integrate internet technologies with its manufacturing sector, through initiatives such as Internet Plus, which has been tied to BRI. Between 2010 and 2014, China contributed almost $2 billion to creating ICT infrastructure, outspending UN agencies, the World Bank, EU institutions, South Korea, and Germany. China is now seeking to export its own national digital standards to BRI partners, urging internet-based companies to join BRI through increasing investments in network infrastructure, which would “speed up the construction of a ‘digital Silk Road.’” Finally, China’s ambitions raise important security concerns for the United States. At the fourth World Internet Conference held in December 2017, Chinese state media outlets announced that Saudi Arabia, Egypt, Turkey, Thailand, Laos, Serbia, and the United Arab Emirates had “agreed to cooperate with China in the digital economy to build an interconnected digital Silk Road.” This seemingly benign initiative carries geopolitical implications. Fiber optic cables transfer an unimaginable amount of data that includes personal, financial, and medical records, as well as sensitive government information. There are multiple ways to tap a fiber optic cable, but physical access and breaking encryption codes are the two easiest methods. Once an intruder has gained physical access to the cable, tapping information is relatively easy. Moreover, those who lay the physical fiber cable can also bend or clamp the fibers so as to create micro-bends or ripples, which allows data to leak out and be transferred, if a receiver is installed. Prior actions taken by the Chinese government, such as installing backdoors in encryption technology, suggest that it will take similar actions when laying down fiber optic cables in other countries. State-owned enterprises such as China Mobile, China Telecom, and China Unicom, have all been expanding network layouts in BRI countries when installing such cables. Private Chinese technology companies that are suspected [PDF] of having close ties to the Chinese government and intelligence services, such as Huawei and ZTE, are also signing deals with countries as scattered as Belize, Ecuador, Guinea, and the Solomon Islands to lay fiber optic cables. China has evolved from wanting to control information to wanting to control the algorithms that affect the distribution of information, through standard setting in international organizations. This includes dominating the development of 5G networks, which are scheduled to be completed in 2020. The global technical standards for 5G networks are currently being debated within a multilateral UN body, the International Telecommunications Union (ITU). The ITU’s Working Party 5D (WP5D), where these deliberations are occurring, is relying on inputs from the Third Generation Project (3GPP), an industry-based, multinational technical organization composed of telecommunications organizations from the U.S., Europe, China, Japan, Korea, and India. Beyond investing heavily in the 3GPP deliberations, China is also preparing its own specifications for a proposal to submit to WP5D by 2020, based on its own domestic standards. As China continues to exalt the success of BRI and champion the idea of a community of common destiny, potential stakeholders—as well as the United States—should take a closer look at the implications of contributing to a digital Silk Road and decide whether the economic, social, and security costs are worth the benefits.