Chinese President Xi Jinping also general secretary of the Communist Party of China (CPC) Central Committee and chairman of the Central Military Commission, addressed a symposium marking the fifth anniversary of the Belt and Road Initiative (BRI) in the Great Hall of the People in Beijing on August 27, 2018. Xi pointed out some imperative implications and results from the BRI so far.
Firstly, that the BRI is an economic cooperation initiative. Secondly, he emphasised on BRI as an open and inclusive initiative, which encourages the participation of other countries. Furthermore BRI is not confined by any specific ideology, rather it aims at furnishing the interests of all concerned parties. As the flagship project of BRI, the China Pakistan Economic Corridor (CPEC) has had the most significant progress in the past five years. Up to now, 9 projects have been completed and 13 projects are under construction.
China is looking forward to strengthening cooperation with the new Pakistani government and to promote the high quality development of CPEC.
Firstly, high quality development is not simply investment and lending development; it aims to improve the quality of the actual investment in the CPEC. Investment is not an end, but a means. Its core objective is to promote the optimisation and upgrading of Pakistan’s economic structures, to improve the competitiveness of the Pakistani economy in the international market, and to promote Pakistani exports. It is more important to ensure the efficient use of investment funding, rather than the total amount of funding.
In this regard, investments under the CPEC framework should have the following characteristics:
Firstly they should not function on a simple, repetitive investment cycle without planning. Such investment will only intensify market competition, worsen the market environment and cause waste of resources. Secondly we must remember that it is an investment with a top-level plan. Moreover it encourages China’s private capital to invest in the CPEC, and provide foreign exchange funding support for the existing enterprises.
High quality development aims to improve the quality of the actual investment in CPEC. Investment is not an end, but a means. Its core objective is to promote the optimisation and upgrading of Pakistan’s economic structures
Most importantly, however, this high quality development is going to bring the benefits of CPEC to the general Pakistani public; enhancing a sense of national gain within the people. Most of the early-harvest projects of the CPEC were concentrated in infrastructure and energy projects, but there were also other projects relating to people’s well-being, such as medical care, schools, agriculture, water supply and so on.
These projects have created jobs for the locals, and promoted economic and social development in Pakistan. For instance, the Fraternity Emergency Care Centre and the Gwadar Faqeer Primary School both won great support from the local people.
Lastly, high quality development should pay more attention to the role of Industrial Park, SEZs. Therefore, it is encouraged for Chinese enterprises to transfer technology to Pakistan.
In recent years, China’s import growth rate has been higher than the export growth rate. Hence, China’s trade policy changed gradually from expanding exports to encouraging exports as well as increasing import.
As a result, the Chinese government not only welcomes Pakistan to expand its exports to China, but is also willing to provide greater market shares for Pakistani goods. However, due to Pakistan’s economic structure, the main commodities that Pakistan exports to China were mainly primary processed products and raw materials.
Therefore, we need to encourage Chinese companies to invest in Pakistan, and encourage Chinese companies to transfer technology to Pakistan, sharing advanced industrial technologies with Pakistan, so as to help Pakistan improve its industrialisation level.
The writer is director, Regional Studies and Strategic Research Centre, Sichuan Academy of Social Sciences, China. The research was sponsored by the National Planning Office of Philosophy and Social Science in China, project name: Strategic Planning and Risk Control on China’s Investment in Pakistan, (Project No. 15CGJ018)
Published in Daily Times, September 5th 2018.