Why OBOR not failure but shared success?

By Yasir Habib Khan

Is there any chink in the armor of One Belt and One Road (OBOR) that may send it packing sooner or later? How long economic integration initiative will remain sustainable fixing the complex issues of security, regional conflicts and crippling financial strengths of poor recipient developing countries? What are funding mechanism to run OBOR smoothly? What does it offer are really interknitted with ground realities or just laced with rhetoric? Such kind of skepticisms being spewed by the West is at full throttle labeling OBOR as failure in current scenario. 

Impartially speaking, OBOR has many reasons to prevent failure. To begin with, it is not a plan brewing underworld to benefit only China. It is a lifeline for all economies electrifying globalization to its new heights. Since its launch, various national and international forums have been taking stock of its myths and realities. Political and economic wizards in Chinese government have never tried to camouflage the facts or distorted the statistics instead laid bare each detail when it comes to share it with more explanations about unquenched answers and misgivings. 

It augurs well that in order to offset venomous campaign hyped by doomsayers and to make it more open to world, OBOR summit is all set to take place in Beijing letting the West and entire world explore OBOR's contour and its pragmatics strategies in tune with the futuristic demands. Summit is an indication of the fact that OBOR does not harbor any Marshal plan. If it had such designed, it would not have placed wide open to all to take a dig at it. 

Financial infrastructure 

Noriyoshi Ehara, chief economist at the Tokyo based Institute for International Trade and Investment, argued that financial infrastructure for OBOR is getting mature every passing day.  

Dampening the tirade of skeptics, initiative is gathering pace with whopping investment along the epic route. China's outbound direct investment (ODI) in economies along the Belt and Road Initiative flourished in the first quarter, the Ministry of Commerce revealed. Chinese companies pumped in $2.95 billion in the non-financial sectors in 43 countries and regions that accounted for 14.4 percent of China's total ODI, Ministry says. An official of Ministry disclosed that companies signed 952 outsourcing deals in 61 countries and regions. 

"Silk Road Economic Belt and 21st-Century Maritime Silk Road has triggered global cooperation in infrastructure, logistics and production capacity," China International Contractors Association president Fang Qiuchen, highlighted significance of route. 

It is because of initiative that State-owned companies such as China Merchants Group and China Railway Rolling Stock Corp, as well as Wison Engineering Ltd and Jinglong Group from the private sector have joined hands with global companies to make voluminous business. 

OBOR is technically systemized to stay afloat as it is well-though plan relishing sound funding mechanism. Featuring 65 countries, 4.4 billion people and about 40 percent of global GDP, China has fortified the plan with ample resources. The China Development Bank, the Export-Import Bank of China and the two newly established multilateral development banks, the Asian Infrastructure Investment Bank (AIIB) and the New Development Bank of the BRICS, become main financial institutions in OBOR. 

The Asia Infrastructure Investment Bank is likely to facilitate the initiative with a bigger share of its $100 billion in lending. The China Development Bank has declared that it will fund up to $1 trillion in One Belt, One Road projects.

Besides others financial institutions, International Monetary Fund, World Bank and Asian Development Bank will also come in handy. Silk Road Fund has already received $40 billion for projects in Central Asia. China has been pouring in $46 billion into the China-Pakistan economic corridor. It has also made an initial contribution of $10 billion to the BRICS-led New Development Bank.  

World acceptance  

Undoubtedly, OBOR is born to succeed as more it is maturing more it has been gaining currency even among those who are its stingy critics. Chinese President Xi Jinping during his speech at the World Economic Forum in Davos, Switzerland in January rightly claimed OBOR's rising acceptability saying more than 100 countries and international organizations thumped up the initiative and that more than 40 countries and international organizations inked cooperation agreements. 

So far, Chinese companies have pumped in more than $50 billion of OBOR-related investments and rolled out a number of mega projects in the countries along the route, he added. 

Wang Yiwei, a research fellow of international relations at the Renmin University of China, said: "So far, more than hundred countries and international organizations have been heading to join the initiative. 

Talking about international community warm reception to New Silk Road Plan, Foreign Minister Wang Yi mentioned that everyone is keenly supporting and planning to participate in the summit as it is genuinely an international economic cooperation forum. Representatives of 110 countries, he said, which include even those that are not on the OBOR route, are expected to join the summit. 

World has accepted the OBOR due to its collaborative sway definitely beyond infrastructure. It will help establishing closer coordination of economic development policies, harmonization technical standards, removal of investment and trade barriers, establishment of free trade areas, financial cooperation and "people to people bonds" involving cultural and academic exchanges, personnel exchanges and cooperation, media cooperation, youth and women exchanges, and volunteer services.

Satisfactory pace of progress  

With the initiative over the last three years, the construction pace has sped up. On March 2016, construction work has kicked off on a railway between Hungary and Serbia, the Jakarta-Bandung High-Speed Rail, the China-Laos railway and the China-Thailand railway as a milestone steps towards a Trans-Asia Railway Network. 

China has already stricken deals with Hungary, Mongolia, Russia, Tajikistan, and Turkey. Project of a train connecting eastern China and Iran to be expanded to Europe is in making. China's Ningbo Shipping Exchange has been collaborating with the Baltic Exchange on a container index of rates between China and the Middle East, the Mediterranean, and Europe. CPEC, pilot project of OBOR, is on fast track. As a sign of partially operationalization of CPEC, first trade convoy from China, reached to Gwadar on November 13, 2016. On December 2, 2016, the first cargo train, using direct rail route and sea freight service between China and Pakistan, embarked from Yunnan. 

The National Development and Reform Commission in its report for national economic and social development to the Fifth Session of the Twelfth National People's Congress (NPC) submitted that the Belt and Road Initiative served as pacesetter to an open economy that saw continuous improvement. 

Development of the Initiative's framework, which consists of six corridors and six channels serving multiple countries and ports, made steady progress, enabling China and its partners to markedly increase cohesion between their development strategies and plans. 

"China-Europe freight train services, which have registered a total of nearly 3,000 trips, were brought under a single unified brand. A number of signature projects for international industrial-capacity cooperation got off the ground. The Addis Ababa-Djibouti Railway officially came into service-from investment and financing to technology, operation, and management and maintenance, Chinese standards were applied throughout the project, making it the first full-production-chain export of China's," report said.

Improvisation to globalization 

According to experts, OBOR has a number of rational not to fall. It gains momentum to promote new globalization trade policy while the U.S. goes more insular under Trump. "After America creates a vacuum by abandoning Trans Pacific Treaty (TTP), China will fill the gaps with this initiative, and that is very logical — it's something the U.S. will later deeply regret," says Louis Kuijs, head of Asia economics at Oxford Economics in Hong Kong. 

The OBOR has yet to get more attention around the world, says Pieter Bottelier, visiting scholar of China studies at Johns Hopkins School of Advanced International Studies in Washington, D.C. "I am worried that its worth stays underrated in the U.S. and in the West in general despite the fact that it is positive initiative," he said.   

New Silk Road has a lot to give world beyond its targeted benefits. Foreign firms will have a numerous opportunities to engage in OBOR projects joining the hands with China to fight against climate change under the Paris Agreement. As new OBOR economic corridors connect economic zones, Western MNEs will get access to labor pools in Central Asia, Southeast Asia and Africa. The global footwear and wearing apparel industry will find opportunities to relocate manufacturing centers and other value-adding activities along OBOR, as wages and other costs rise up in China. OBOR will make faster transit times for cargo. DHL, leading world's largest freight companies, has already been routing volume of freight with greater pace than before along the "Belt," from the city of Lianyungang, China, all the way to Istanbul. 

In nutshell, all the indicators ultimately say loud and clear that OBOR will make everyone sit up and take notice blowing away all mantras of failure being harped on by West. So better be part not apart. 

The author is a senior investigative journalist that works for The News, Pakistan Today, Daily Times and Centerline Magazine in Pakistan.