In the coming years, as governments fine-tune their cyber governance models and lay out plans for 5G networks, the United States and its allies should accelerate efforts to work with Southeast Asian partners on issues related to digital infrastructure and governance if they hope to compete with China's Digital Silk Road.
U.S. Vice President Mike Pence urged allies Saturday at the annual Munich Security Conference to be vigilant and avoid deals with Huawei Technologies. Pence emphasized the risks linked to equipment made by Huawei and other Chinese telecom manufacturers, saying those companies must be shunned due to national security concerns, reports the Nikkei Asian Review.
Increasing criticism towards China's ambitious Belt and Road Initiative (BRI) coupled with China's economic squeeze has prompted Chinese skeptics of BRI to quietly ask if their government is putting its scarce resources to the right use. Although President Xi Jinping's BRI is still supported by leaders in Beijing, Xi's original ambitions are being rolled back out of public view, reports the Nikkei Asian Review.
Huawei's Vietnam chief says the company has received assurances from the country's communications minister that Vietnam remains "open" to Huawei's 5G technology. This comes on the heels of European countries announcing they will reconsider telecommunications partnerships with Huawei due to information security concerns.
Weeks after a meeting of government officials from Beijing and Islamabad, the environmental impact of China-led coal-fired power generation projects in Pakistan is still a hot topic of debate. Lack of disclosure on plans associated with $62 billion China Pakistan Economic Corridor, which forms a crucial part of Chinese President Xi Jinping's ambitious Belt and Road Initiative, is spurring local environmental concerns.
In 2015, Chinese president Xi Jinping debuted a plan at the UN to knit the world's energy grids, currently fragmented along national lines, into a single global network. In reality, Xi's ambitious plan far outstrips what can realistically be achieved in the coming decade given current economic, technical, and political constraints.
The Philippines' leading wireless provider Globe Telecom is on track to launch its Huawei Technologies-backed 5G service in the next quarter. The Philippines has joined Thailand and Singapore that are open to tapping Huawei for 5G amid rising security concerns related to the Chinese telecom equipment supplier, reports the Nikkei Asian Review.
China's $2.5 billion offer to bailout Pakistan as its foreign exchange reserves dry up disappointed Islamabad, which reportedly sought $6 billion from Beijing. Pakistan's balance of payments crisis could threaten the $62 billion Beijing has invested in the China-Pakistan Economic Corridor, reports Nikkei.
David Malpass, U.S. President Donald Trump's nominee to lead the World Bank, told media sources on Wednesday that he hopes to cut the multilateral lender's loans to China, which he believes is too wealthy to receive large loans from the World Bank. Malpass also criticized China's Belt and Road infrastructure initiative, saying that the BRI "leaves countries with heavy burdens of debt," reports Nikkei.
The trial of Najib Razak, Malaysia's former prime minister, over corruption-related charges tied to the 1MDB development fund is scheduled to begin on February 12. The prosecution is expected to probe whether China-backed infrastructure projects signed by Najib's government were used to bail out 1MDB, reports Nikkei.
China is facing new challenges after billions of dollars have been invested into Asia through Belt and Road infrastructure projects. BRI funds have increasingly flowed into Asia, accounting for 39 percent of the project's total contract value from January 2014 to June 2018, outpacing funding for Africa, which has received 30 percent.
One of China's Belt and Road Initiative's biggest environmental impacts may be on the world’s water. Should BRI projects strain the world's water resources, the initiative may carry important, and perhaps negative, implications for global and local conflicts over shared water resources.
China's Digital Silk Road is ambitious and includes fiber optic cables, 5G networks, satellites, smart cities, and the devices that connect to these systems. On February 5th, the CSIS Reconnecting Asia Project hosted a discussion about these developments and their implications for U.S. economic and strategic interests.
In the Maldives, government officials are examining official documents to determine the amount owed to China after reports emerged that the debt could be as high as $3.2 billion, a substantial increase over $1.3 billion in officially recorded Chinese loans.
Hanjin shipyard operator, HHIC-Phil, filed for bankruptcy after failing to pay $412 million in debts to five local banks and $900 million more to South Korean creditors. With state-backed Chinese companies offering to acquire the shipyard, Philippine's president Duterte faces a strategic dilemma regarding whether or not to accept this offer and grant the Chinese unlimited access to a vital naval and maritime asset.
Saudi Arabia plans to build Pakistan's largest oil refinery near Gwadar port, the flagship project of the China-Pakistan Economic Corridor (CPEC). The oil refinery, part of Saudi Arabia's new commitment to invest $15 billion in Pakistan over the next three years, could fuel competition with Beijing for economic leverage given China's significant investment there under CPEC, reports the Nikkei Asian Review.
Malaysia will cancel its $20B East Coast Rail Link project with contractor China Communications Construction Co Ltd due to the high cost, but stated that they will continue to welcome investment from China on a case by case basis.
Singapore and China on Thursday agreed to set up an international mediation panel to resolve disputes arising from projects under China's Belt and Road Initiative. The agreement was inked at the first China-Singapore International Commercial Dispute Resolution Conference in Beijing, attended by some 300 delegates.
Chinese President Xi Jinping is planning a visit with India's Prime Minister, Narendra Modi, as early as February. President Xi hopes to improve diplomatic relations with India ahead of China's second Belt and Road Initiative Forum in April, Nikkei reports.
With an eye toward illuminating current issues, this report draws from examples throughout history of how states use foreign infrastructure to advance strategic objectives. It shows how China is updating and exercising tactics used by Western powers during the nineteenth and twentieth centuries, and how these issues, and the strategic implications they carry, are likely to intensify in the coming years.
Chinese investment in railways is expected to rise by about 6 percent year-over-year to $125 billion in 2019, part of a stimulus plan to shore up China’s lagging economy. China Railway, which manages the country’s rail-sector, expects to build 6,800km in new rail tracks this year, a 45 percent increase in construction over 2018.
Until Chinese officials improve transparency standards, the international community should provide better alternatives to Chinese infrastructure loans and publicize the perils of opaque approaches to building infrastructure. Leaders in recipient countries must also demand greater transparency -- or risk drowning in the murky waters of China's Belt and Road Initiative.
Saudi Arabia plans to set up a $10 billion oil refinery at Pakistan's Chinese-funded Gwadar port, according to a statement given by the Saudi energy minister. Pakistan's petroleum minister, Ghulam Sarwar Khan, has said that the project will make Saudi Arabia an important partner in the China-Pakistan Economic Corridor.
In 2017, China surpassed South Korea to become the world’s second-largest liquefied natural gas (LNG) importer. In a few years, it might overtake Japan. But how is China securing its LNG needs?
The government of Pakistan awarded a $2.21 billion contract to build the Mohmand dam to a consortium of China Gezhouba and Descon—the latter founded by Abdul Razak Dawood, the prime minister's adviser on commerce and industry. The conflict of interest has drawn scrutiny from the government's leading opposition party which has called for an investigation of the project's procurement process.
China Three Gorges Corp, operator of the world's largest hydropower plant, is turning to projects offshore as domestic costs soar and space runs out on China's crowded rivers. The company, which already has business in more than 40 countries, will focus mostly on South Asia, Southeast Asia, Africa, and Latin America, reports the Nikkei Asian Review.
The European Commission has become increasingly critical of various Chinese investments within the EU, fueling an ongoing debate within Europe about investment screening. While the EU released a framework for foreign investment screening implicitly aimed at China in November 2018, the debate has exposed cross-cutting divisions within Europe. Looking ahead to 2019, we should not expect a clear resolution anytime soon.
Beijing is currently working on construction of a high-speed rail line in northern Thailand. Under its planned 3,000-km pan-Asian railway network, Chinese rail lines will extend even further south, stretching through Malaysia and feeding into Singapore, reports the Nikkei Asian Review.
Should inter-Korean cooperation result in the re-joining of North and South Korea's railways, it could connect the peninsula through China and Russia to a rail network that spans Eurasia. However, such connections will require a long and costly modernization process to fully integrate the systems in a commercially viable way, complicating the future of these potentially transformative links.
Malaysia will review claims that China signed over-valued infrastructure projects to bail out Malaysia's state investment fund, 1Malaysia Development Berhad, under former Prime Minister Najib Razak's tenure.
Pakistan is asking China to shift its investment focus from power and infrastructure projects to industrialization, agriculture, and education as regards the China Pakistan Economic Corridor, reports the Nikkei Asian Review.
In an effort to provide an alternative to China's Belt and Road Initiative, Japan will help build "smart cities" across Southeast Asia, using artificial intelligence and networked devices to tackle problems like road congestion and energy conservation, reports the Nikkei Asian Review.
China's state planner has approved inter-city railway projects in the eastern provinces of Jiangsu and Anhui, with a combined total investment value of $33.82 billion and a total length of 1,063 km.
Reconnecting Asia tracks infrastructure developments across Eurasia, a vast landmass that includes 60 percent of the global economy. Every day, new infrastructure projects are announced, some are advanced, and others encounter obstacles. Here is a selection of projects and trends we will be watching in 2019.
Under former president Abdulla Yameen, the Maldives took substantial loans from Beijing for infrastructure projects. $850 million of a $1.4 Chinese loan is expected to be drawn by year end as Beijing advances its projects in the country, reports the Nikkei Asian Review.
Tokyo Gas and China National Offshore Oil Corporation both partnered with Filipino companies to compete for the building of the Philippines' first liquefied natural gas terminal. Though Japan and China's leaders agreed to jointly advance third-country infrastructure projects, companies have not been able to shift from competition to collaboration in the field, reports the Nikkei Asian Review.
Data shows that between 2014 and 2017, the cumulative value of construction contracts has been 50 percent higher for Belt and Road projects, at $230 billion, than for unrelated deals, which amounted to $148 billion, reports the Nikkei Asian Review.
China and the West have been vying for infrastructure projects in Bougainville, an autonomous region in Papua New Guinea, in an escalating battle for influence in the South Pacific, reports the Nikkei Asian Review.
Indian cities are vastly expanding their subway networks to reduce road congestion and gasoline consumption. The Delhi Metro is expected to reach 378 kilometers of track this year, catching up with New York--the world's fourth-largest subway system.
China envisions a vast global network of trade, investment, and infrastructure that will bring the world closer to Beijing. To better understand how China's vision is playing out on the ground, The New York Times examined nearly 600 Chinese-financed projects and the driving forces behind them, citing data from the Reconnecting Asia Project.
China agreed to fund the $365 million Kaliwa dam and take part in the $3.3 billion southern Luzon railway project in the Philippines. A memorandum of understanding on oil and gas exploration was also signed between the two countries.
Pakistan faces a financial crisis and has secured a bailout package from Saudi Arabia, but surprisingly, it has yet to secure a similar package from China. Pakistan expected a decent bailout package from China, which is often called Pakistan’s all-weather friend, but China likely wants more detailed negotiations. Five reasons help explain China’s surprising response.
China and the Philippines are expected to sign billions of dollars worth of Belt and Road deals on Tuesday, as the United States and the Philippines move forward on key issues including free trade talks, reports the Nikkei Asian Review.
Washington’s shortsightedness is pushing its own competitors—the world's largest nuclear power and the second-largest economy—closer together.
Indonesia's vice presidential candidate Sandiaga Uno said on Tuesday that the government will review the Chinese-led construction of a high-speed rail line connecting Jakarta and the city of Bandung, if the opposition wins Indonesia's presidential election next year.
Five years into China’s massive Belt and Road Initiative, the United States is trying to respond to Xi Jinping’s infrastructure-building spree. In an interview with The Wall Street Journal, Reconnecting Asia Director Jonathan Hillman discusses the craving for more alternatives to Chinese offers and the window of opportunity it creates for the United States.
On November 14, the U.S.-China Economic and Security Review Commission, a body created by Congress to monitor and investigate national security and trade issues between the United States and China, published its 2018 Annual Report. Reconnecting Asia’s data and analysis are used to help discern China’s objectives for the Belt and Road Initiative and to highlight potential challenges and opportunities for the United States.
On his trip to Asia, U.S. Vice President Mike Pence will play up Washington's efforts to boost infrastructure investment in the region at a time when China is doing the same with its Belt and Road Initiative, according to the Nikkei Asian Review.
China Railway Construction will join a consortium led by Charoen Pokphand Group (CP Group) to bid for the construction of Thailand's $7 billion high-speed railway project that will link three major airports.