OBOR: China’s soft power projection



AMIDST an awesome display of pomp and pageantry, China launched Xi Jinping’s One Belt, One Road (OBOR) initiative which he described “as a bridge for peace, a road to prosperity, a way to boost inclusive growth and balanced development and to promote equality”. The Chinese president announced that China plans to invest billions of dollars to revive the ancient Silk Road and maritime trade routes. Various trade and infrastructure projects have been lined up to link China to Asia, Europe and Africa in a bid to promote economic development that is open, inclusive, and beneficial to all. The central theme of the OBOR is the creation of an economic land belt that include countries of the original Silk Road which passed through Central Asia, West Asia, the Middle East and Europe, as well as a maritime road that links China’s port facilities with the African coast, pushing up through the Suez Canal into the Mediterranean.

Silk routes existed in the past. It is not a new concept. Marco Polo, Vasco de Gama. Magellan and other explorers were forever looking for routes linking the West to the East. As Rudyard Kipling used to say, “Go East, young man.” The only difference is that today China wants it the other way around. Linking the East to the West!

Indeed, the old silk routes paid handsome dividends for the explorers and adventurers not only in the form of silk but also in silver and gold. Moreover, cultures, cities and peoples who lived along the silk roads developed and advanced, particularly the European colonizers like Spain and Portugal and the northern Europeans later. As they traded and exchanged ideas, they learned from each other stimulating advances in philosophy, the sciences, language and religion (I used to joke that because of Marco Polo the Italians learned to enjoy “pancit” which they call spaghetti.)

Manila-Acapulco Galleon Trade
The famous Manila-Acapulco Galleon Trade was the original formal maritime silk route that plied the great oceans from Asia to the Americas and from Asia to Europe. The Manila-Acapulco galleon trade flourished from 1565 to 1815.Spanish galleons built in Cavite shipyards carried spices, ivory, porcelain, lacquer ware and processed silk from China and Southeast Asia for the European markets. From the Americas, gold and silver were brought to China and so a trilateral trade blossomed linking Asia to Europe and the Americas.

Today, China is simply relaunching the old silk routes. In this connection, China plans to negotiate free-trade agreements with 65 countries (representing a third of the world’s economy and more than half the global population) along the OBOR. Just imagine the geopolitical and geo-economics impact of such moves.

In his keynote address to some 1,500 delegates, the Chinese president explained his OBOR initiative, conceptualized by him as early as 2013 thus: “We should build an open platform of cooperation and uphold and grow an open world economy…We should foster a new type of international relations featuring win-win cooperation; and we should forge partnerships of dialogue with no confrontation and of friendship rather than alliance.”

To put his money where his mouth is, Xi announced that China will contribute billions of yuan to bolster the Silk Route projects. Three financial institutions have been set up to support its development—the Silk Road Infrastructure Fund, the Asian Infrastructure and Investment Bank and the New Development Bank set up by the BRIC (Brazil, Russia, China and South Africa) countries.

Before some 29 heads of state and representatives of multilateral financial institutions, Xi made clear that the Belt and Road Initiative will be inclusive, inviting countries big and small to become international cooperation partners, creating a big family of harmonious co-existence. This was a dig at the exclusive rich country clubs, the likes of G-7 and G-20 and others.

New model of international cooperation
Pledging non-interfere in the internal affairs of countries, Xi added that OBOR would not resort to outdated geopolitical games but aim to attain a new model of “win-win cooperation”—a new model of international relations which can be described as geo-economics. This soft-power approach is in stark contrast to the hardline projections of other superpowers which do not have any qualms about the use of gunboat diplomacy favored in colonial days.

Xi describes the central theme of OBOR, which calls for the promotion and development of air, land, sea and cyberspace connectivity through a network of highways, railways and sea ports: “In pursuing the Belt and Road Initiative, we should focus on the fundamental issue of development, release the growth potential of various countries and achieve economic integration and interconnected development and deliver benefits to all” and more importantly the pursuit of innovation-driven development and intensified cooperation in frontier areas such as digital economy and smart cities “so as to turn them into a digital silk road of the 21st century.”

To capitalize on the windows of opportunity offered by the OBOR, this country and the Asean nations in general, must make an effort to persuade the initiator of OBOR that its policies harmonize with the long-term goals of developing countries even as they urge their own countries to follow the path good governance. Indeed, if this country becomes one of the spokes of the OBOR wheel, infrastructure development funds and direct foreign investments can flow faster and in bigger amounts to supplement Dutertenomics characterized by build! build! and build!

But having said all the above, we would not like to leave an impression that the implementation of OBOR will be a walk in the park. Obviously, there will be challenges of a political and economic nature.

Mother of all fears
As we write, India is not yet on board the gravy train because the Silk Road map is designed to pass through Pakistan, its arch political nemesis. This attitude of the second most populous and second biggest economy in Asia will not exactly cripple OBOR but it will certainly knock off some wind from its sail. There is also the concern that the road will have to go through Central Asia, the most conflicted area in the world today. Moreover, the problem of the absence of a central implementing agency that will visualize, operationalize and harmonize the goals and objectives of OBOR in the face of possible politically motivated— non-economic projects of beneficiary countries which may not be compatible with the larger vision, is another consideration.

The anxiety over country borrowers from the central fund, whose credit credentials may not be up to par with acceptable sovereign guarantees is also there. Add to this the fear that corrupt governments may hijack the sweet loans offered by China as in the DAP and PDAF scandals. We have not yet factored in some economic cost considerations like the fact that the maritime route, though slower, is much cheaper than the land route.

The mother of all fears, however, is that some countries with shallow pockets may incur a whopping external debt from Silk Road projects that will effectively put them in the pocket of China. It is recalled that many countries today are still dictated by conditionalities imposed by such multilateral financial institutions as the IMF, the World Bank et al. Hopefully, Silk Road loan entities will not have strings attached to their credit accommodations.

Nevertheless, the vision of a project bigger than the Marshall Plan that reconstructed and rehabilitated war-torn Europe after World War 2 cannot be easily dismissed on the grounds of possible faulty and flawed implementation or exaggerated fears by some prospective beneficiaries. At the end of the day due diligence by one and all is the absolute prerequisite to the success of the grand design.


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1 Comment


    Yonkers, New York
    20 May 2017

    China’s OBOR, as explained succinctly but clearly and completely by Dr. JOSE V. ROMERO, JR. in this column of his in The Manila Times of May 20, 2017, has the potential to turn out as a world-shaking and -changing development which could be at least on a par with such past world-shaking breakthroughs as the RENAISSANCE and the INDUSTRIAL REVOLUTION.

    China, now one of two of the wealthiest nation in the world, a very close second to the United States of America, is in a very good position to bankroll this very ambitious project, and there is every indication that it also has the technology and the manpower to push OBOR to successful completion within a span of ten years or so.

    The world can only be a better place, in terms of prosperity and peace, after OBOR achieves its goals