Monday, August 19, 2019

Prayut has a duty to stand up to China

Apr 23. 2019
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By The Nation

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As the representative of Asean interests at this week’s Belt and Road Forum, PM must push for fairer deals 

China’s global ambitions face an acid test this week as world leaders gather for the second Belt and Road Forum. Six years after its launch, China’s grand loans-and-infrastructure strategy is faltering amid reports of participant countries falling into a debt trap and problems with mega-project management.

At the invitation of President Xi Jinping, Prime Minister Prayut Chan-o-cha will arrive in Beijing on Thursday for three days of discussion on the Belt and Road Initiative.

Joining him will be 37 heads of state, among them the presidents of Chile, Mongolia, Nepal, Portugal and Switzerland. Meanwhile France, Germany, the UK, Spain, Japan, South Korea and the EU are sending high-level representatives, according to Chinese Foreign Ministry.

The forum will end with a joint communique that reflects the direction the BRI scheme will take going forward, including transport connectivity and concerns over the environment and 

sustainable development.

Initiated by President Xi, the BRI scheme was launched in 2013 to forge economic routes via land and sea that will link China with the rest of Asia, Europe and Africa.

Six years’ later, the BRI has become the core of Chinese foreign policy and is deeply linked to Xi’s fate as president. China reports that 126 countries and 29 international organisations have signed on to join the scheme.

Total trade volume between China and participating countries has surpassed US$6 trillion, while investment has exceeded $80 billion and the 82 cooperation parks built by China and partner countries have created nearly 300,000 jobs, according to Beijing.

Yet China’s assertion that the BRI is a high-standard platform for cooperation is being eroded by growing claims that the scheme represents a debt trap. A recent Centre for Global Development report found eight BRI recipient countries – Djibouti, Kyrgyzstan, Laos, the Maldives, Mongolia, Montenegro, Pakistan and Tajikistan – are at a high risk of debt distress from BRI loans. These countries all face debt-to-GDP ratios beyond 50 per cent, with at least 40 per cent of their external debts owed to China once BRI lending is complete.

Asean countries also face BRI debt burdens, but it is project management that is of greater concern for many countries in our region. Thailand will on Thursday sign an MoU with Laos and China to build a high-speed rail line between Nong Khai and Vientiane. Construction of the link from China’s border to Vientiane will likely go smoothly but the project has 

hit the buffers in Thailand, where only 3.5 kilometres of high-speed track is being built as a trial run.

Elsewhere, a project to blast navigable channels in the Mekong River running through Laos to the Thai border has been put on hold amid environmental concerns and local resistance. Mekong countries, including China, have yet to agree whether and how the project will go ahead.

Farther south, the new government in Kuala Lumpur has adopted a more flexible strategy in dealing with China and the BRI. Malaysia announced last week that its BRI rail line project shelved since last July would now go ahead after renegotiation with the Chinese. 

Meanwhile Laos has remained tight-lipped over its BRI debts. In contrast Cambodia has voiced nothing but praise for China, which has funded construction of 31 highways and eight bridges over a total length of more than 3,000km, as well as building hydroelectric dams for its neighbour. Phnom Penh’s positive stance towards China has triggered some awkwardness among fellow Asean members. 

As the chair of Asean, Prayut has a duty to take the lead in talking frankly with Beijing on both the positive and negative aspects of BRI projects. It may not be easy, but if he wants to lead Asean effectively and responsibly, Prayut must point out that many of the BRI deals place Asean countries at a 


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