Is the China-Pakistan Economic Corridor in crisis?
Sheridan Prasso reports from Gwadar, Pakistan, for Bloombergย (porous paywall):
Plans originally called for a seaport, roads, railways, pipelines, dozens of factories and the largest airport in Pakistan. But, almost seven years after the China-Pakistan Economic Corridor (CPEC) was established, thereโs little evidence of that vision being realized. The site of the new airport, which was supposed to have been completed with Chinese funding more than three years ago, is a fenced-off area of scrub and dun-colored sandโฆ
Less than one-third of announced CPEC projects have been completed, totaling about $19 billion, according to government statements. Pakistan bears much of the blame. It has repeatedly missed construction targets as it ran out of money; it got a $6 billion bailout from the International Monetary Fund last year, the countryโs 13th since the late 1980s. Two successive prime ministers have been jailed on corruption charges. And the Baloch Liberation Armyโs desire for a separate homeland in Balochistan Province, where Gwadar is located, has made life there uneasy.
CPEC is the heart of the Belt and Road Initiative, often headlined as a โtrillion-dollar plan,โ but Prasso calculates that Beijing is falling short of that larger goal, too:
While the value of signed projects increased last year, data from Chinaโs Ministry of Commerce show actual spending stalled at $75 billion in 2019 after falling 14% the previous year. Total spending from the beginning of 2014, shortly after President Xi announced the initiative, through November 2019 is $337 billion.
Two other Belt and Roadโrelated stories today:
- โChina is preparing to sign a deal to strengthen its ties with Colombiaย as its companies pour billions into rail projects, mines and other investments in the country,โ Bloomberg reports. The South American country, which traditionally is closer politically to the United States, is attractive to China because of its political stability and its fast growth rate, at 3.3% last year, according to the Chinese ambassador to Colombia, Lรกn Hว ่่.
- A Marxist take on Belt and Roadย can be found on the blog Panda Paw Dragon Clawย in a piece on how geographer David Harveyโs theories on economies facing crises of overaccumulation may help explain the motivation for Belt and Road.
โLucas Niewenhuis