China’s Belt and Road Initiative (BRI) and Nigeria’s Memorandum of Understanding on the BRI
Today, the Embassy of the People’s Republic of China in Nigeria holds a Forum to discuss the Belt and Road Initiative and Production Capacity Cooperation between China and Nigeria. On the sidelines of this discussion forum, the Chinese community in Nigeria is also celebrating the Lunar New Year in China. Our main focus in this column is on the issue to be discussed by the Forum: the Belt and Road Initiative (BRI). It is to serve as a prolegomena to the seminar.
The BRI is not only referred to as the ‘One Belt One Road’ (OBOR), but also as ‘Silk Road Economic Belt and the 21st Century Maritime Silk Road.’ The use of belt covers the overland routes, that is road and rail transportation, and therefore called the Silk Road Economic Belt. On the contrary, the use of ‘road’ is to describe the sea routes or the 21st Century Maritime Silk Road.
Three factors are noteworthy in understanding the subject. First, it is a project initiated under the Xi Jinping administration and first made public in Kazakhstan in September and in Indonesia in October 2013 as a geo-political and geo-economico development strategy meant to be implemented at the plurilateral level to begin with. In this regard, it was simply referred to as OBOR until 2016 when the name was changed to allow for global involvement and to give it a more multilateral framework. Emphasis was no longer placed on the use of ‘One.’ Emphasis was simply placed on the development of infrastructure and injection of fresh investments in various countries of the world.
As explicated in 2016 by Kuik, the BRI is a connectivity of systems and mechanisms. It is ‘to construct a unified large market and make full use of both international and domestic markets, through cultural exchange and integration, to enhance mutual understanding and trust of member nations, ending up in an innovative pattern with capital inflows, talent pool, and technology database.’
Muhammad Khalil Khan et al consider the BRI as a ‘cornucopia of international projects that offer mammoth opportunities for more economic cooperation and deeper regional integration primarily among emerging economies.’. They posit further that, ‘in essence, BRI is a critical tool for peaceful development that is resulting in massive investments in infrastructure, that is facilitating economic development and that is promoting shared governance’ (vide their “China’s Belt and Road Initiative: A Global Model for an Evolving Approach to Sustainable Regional Development” in Sustainability, 2018, Volume 10, Issue 11, pp. 4234 et s). Thus, the beauty of the BRI is its aspect of quest for peaceful development, shared governance, win-win cooperation model, shared globalisation, communities of interests, and shared future.
Without doubt, the BRI has its own aspect of international politicisation. Some observers have said that the Chinese government is seeking to increase its share of global influence if not global dominance. The position of the Chinese government is that it wants to ‘enhance regional connectivity and embrace a brighter future.’ China, in the eyes of its Foreign Minister, is also emphasising equality of sovereignty.
From the perspective of the Americans, the BRI is a failure that the Washingtonian authority should not copy. As explicated in foreign policy.com, ‘many Americans fear that the Belt and Road Initiative is an extension of efforts by the Chinese Communist Party (CPP) to undermine the security and economic architecture of the international order. China’s growing largesse, they worry, comes largely at the expense of international institutions and American influence.’
And perhaps more interestingly, in fear of the emerging global leadership of the Chinese, in a meeting of the Asia-Pacific Economic Cooperation (APEC), Australia, Japan and the United States announced the establishment of their own ‘trilateral investment initiative to help meet infrastructure needs in the Indo-Pacific.’ Besides, the US-China Economic and Security Review Commission has also advised the Congress to create an additional fund ‘to provide additional bilateral assistance for countries that are a target of or vulnerable to Chinese economic or diplomatic pressure.
Additionally, foreignpolicy.com also has it that, ‘by buying into the flawed idea that barrels of money are all that is needed to solve complex geopolitical problems, China has committed a colossal error.’ Thus, when Xi Jinping is happily talking about a ‘community of common destiny, ‘national rejuvenation,’ a ‘unique role for China to play,’ etc, the Americans do not see any big deal about them.
There is nothing wrong in the position of the Americans, for reasons of psychology of human differences and there is nothing wrong in China’s pursuit of regional connectivity which is nothing more than regional integration in another sense. Regional integration has been generally accepted as a model to fast track global development. It was on this basis that the Economic Community of West African States (ECOWAS) was established in 1975. It was also on this basis that Africa was divided into five regions in order to enhance rapid development (vide the 1991 Abuja Treaty Establishing the African Economic Community).
The truth of the matter is that the Chinese think differently. In their thinking, the Chinese, the need for development in their immediate neighbourhood, hence a plurilateral approach, is required in the maintenance of regional and global peace and security. This is the context under which the explanation and understanding of the BRI should be located.
The second point of note is the nature of the goals pursued: policy coordination, facilities connectivity, unimpeded trade, financial integration, and people-to-people bonds. Whoever is talking about coordination of policies, integration and people-to-people relationships is necessarily also talking about shared attitudinal disposition to all questions dealing with the BRI
Thirdly and more importantly, the funding of the BRI is essentially to be borne by China. The BRI is essentially to respond to the infrastructure deficit in Asia, the estimated cost of which, excluding China, is put at US$900 billion of infrastructure investments per year over the next decade by the World Pensions Council, mostly in debt instruments, 50% above current infrastructure spending rates.’
In fact, the position of the Americans is strengthened by the challenges of funding of the six economic corridors, three of which have only been funded in the past five years. The factor of hostility in some countries, such as in Sri Lanka, where the Sri Lankan security forces and Buddhist monks clashed during a protest in the Southern port city of Hambantota over the creation of an industrial zone for Chinese investments on the island on January 7, 2017, constitutes another important consideration. Above all is the perception of the BRI as a debt-trap for some participating countries. True, many countries are already heavily indebted to China on project loans. More loans are seen as a trap to deepen dependence on China.
In spite of the American perceptions, the truth of the matter is well revealed in a recent survey carried out by a Singapore-based think-tank and involving 1,008 respondents in 10 Members States of the Association of Southeast Asian Nations (ASEAN). It was found out that ‘some 73% of the respondents believe that China has more political and strategic influence in the region than the United States.’ However, some 73% of the respondents want their governments to be ‘cautious in negotiating BRI projects to avoid getting into sustainable financial debts to China.’ This view is strong in Malaysia, Thailand and Philippines.
Consequently, the BRI is not simply a geo-strategic development framework, but also one which has the great potential to open-up China to the world in terms of new superpower politics in which China is underscoring cooperation that is open and mutually benefiting for all the participating countries. The principle is basically adoption of joint approach to the definition and evolvement of policies, joint implementation of policies, joint resolution of issues of misunderstanding, and joint sharing of benefits. This joint approach to doing things is largely defined by the recognition that all Member States of the international community are sovereign and equal, at least, from the perspective of international law.
In this regard, the strategy is to have Asia, Europe and Africa connected along five routes. Within the framework of the Silk Road Economic Belt, the first route is the linkage of China to Europe through Central Asia and Russia. The second is to connect China with the Middle East through Central Asia. The third is to connect China, South East Asia, South Asia, and the Indian Ocean. The fourth and fifth routes, which are the Belt or maritime routes, are the linkage of China with Europe through the South China Sea and the Indian Ocean for the fourth route, and the connection of China with the South Pacific Ocean through the South China Sea.
Additionally, six international economic cooperation corridors are to be built: New Eurasia Land Bridge; China-Mongolia-Russia; China-Central Asia-West Asia; China-Indonesia Peninsula; China-Pakistan; and Bangladesh-China-India-Myanmar.
Fourthly, and most importantly, Nigeria has signed a Memorandum of Understanding on the BRI, meaning that Nigeria is among the 68 countries of Asia, Africa and Europe participating in the BRI, currently considered as of the largest infrastructure and investment projects in history with the involvement of more than 68 countries, or 65% of the global population and 40% of global GDP as at 2017.
The joining of Nigeria is very consistent with the principles of Nigeria’s foreign policy in many ways. At the level of Nigeria’s Non-alignment policy, which appears to be the most critical and controversial, it is particularly consistent. The decision to join the BRI was not under coercion but voluntarily done by the legitimate Government of the Federal Republic of Nigeria. Many observers and students of Nigeria’s foreign policy often confuse or misinterpret Nigeria’s policy of non-alignment to imply at the time of adoption of the policy during the Cold War politics that Nigeria would not align with the West or the East.
As presented to the public by the then Prime Minister, Alhaji Tafawa Balewa, Nigeria’s Non-alignment Policy was simply the freedom to decide whether or not to be aligned with the West or the East. It was not about the act of alignment itself. Consequently, the various criticisms levelled against the Government for claiming non-alignment policy and then hobnobbing with the West was completely misplaced. The issue was that the Federal Government of Nigeria, in its own self-enlightened interest, saw Nigeria’s interest in the alignment with the West.
It is from this perspective that Nigeria, under the Muhammadu Buhari administration, believes that there are some benefits to derive from its participation in the BRI, and with this belief, has exercised the freedom to act, under the rule of sovereign right in international law and relations.
There is also the principle of economic diplomacy introduced by Major General Ike Nwachukwu, in his capacity as Minister of External Affairs. Internationally speaking, economic diplomacy emerged in international relations in the Sixteen Century when it was called ‘development diplomacy.’
Economic or development diplomacy has one main objective: attraction of investments, especially foreign, to boost economic development at home, as well as promotion of commercial exchanges, trade. This was what General Nwachukwu and his Foreign Affairs team, led by Ambassador Segun Akinsanya, offered the people of Nigeria. Strenuous efforts were truly made by then, as Ambassador Akinsanya was able to establish a special unit in the Foreign Ministry for this purpose. And true also, the Nigerian Institute of International Affairs, under the leadership of Professor George Obiozor, gave very active intellectual support in the conception of economic diplomacy.
What the PMB administration is similarly trying to do by signing a Memorandum of Understanding with China is to be able to secure Chinese investments for the purposes of addressing, in particular, the infrastructure deficit in Nigeria. This is largely in Nigeria’s long term interest. Many countries have done the same. In fact, as revealed by the state-run Xinnuanet, ‘so far, China has signed 123 cooperation documents on the Belt and Road development with 105 countries in Asia, Africa, Europe, Latin America, and the South Pacific region, and 26 such documents with 29 international organisations.’ Thus, Nigeria’s participation cannot therefore be an exception, more so that Nigeria, under Chief Olusegun Obasanjo, laid the foundation for such cooperation.
President Muhammadu Buhari arrived Beijing on Saturday, September 1, 2019 to attend the Forum on China-Africa Cooperation (FOCAC) during which Nigeria and China did an agreement on ICT. As revealed by presidential spokesman, Garba Shehu, $328 million was to be committed to the National Information and Communication Technology Infrastructure Backbone Phase 11 (NICTIB 11) in Nigeria.
In the words of the Chinese Consul General in Lagos, Chao Xiaoliang, ‘China and African countries are destined to be good friends, good brothers and good partners. China-Africa relations have demonstrated unprecedented solidarity, vitality and creativity, which offer significant opportunities to both sides. This also applies to Nigeria-China relations, as China together with Nigeria and other African countries, are ready to join hands to build a China-Africa community with a shared future that features joint responsibility, win-win cooperation, happiness for all, as well as a common prosperity, common security, and harmonious co-existence.’
These words cannot but be welcoming in the eyes of any African, particularly the Nigerian leader. Nigerians generally like to be well treated even if they are very poor and have nothing to offer in any given situation. When they are respected, you easily get the best out of them. If Nigeria has accepted to sign an MOU on the BRI, one rationale for it is surely that the person of Nigeria as a state and as an individual has not been perceived to have been tainted. Nigerians and Chinese are considered to be brothers. They relate on the basis of solidarity. This is why the making of an MOU is a reality today.
Nigeria’s MOU on the BRI follows the standard of all MOUs other participating countries have signed. In other words, Nigeria reached an understanding to cooperate with China in the area of policy coordination, facilities connectivity, unimpeded trade, financial integration and people-to-people bonds. These five areas of understanding are always ‘guided by the principles of wide consultation, joint contribution and shared benefits.’ These principles are precisely what often attract China to African leaders.
And true enough, China often presents itself as a Third World country, and by so doing, consciously endearing itself to countries truly in this category. And with this attitudinal disposition, the Third World countries do not see China as an exploiter the way the former colonial masters of Africa are generally seen.
Besides, China wants to further market integration, as well as create a regional economic cooperation framework for the benefit of all the countries that accept to participate in the project. In this regard, for instance, Ambassador Chao Xiaoliang also has it that, in the next three years, China is to launch eight new cooperation initiatives in its relations with Africa. They are in the area of industrial promotion, infrastructure connectivity, trade facilitation, green development, capacity building, healthcare, people-to-people relations, peace and security.
The BRI, without doubt, is good an initiative. The issue of how to adequately fund the BRI is most critical. On the basis of these BRI projects and others, many countries which are heavily indebted to China (Pakistan, Maldives, Laos, Sri Lanka, Djibouti, etc) as noted above, are currently the pointers to future challenges. Sri Lanka, owing China more than $1billion, has opted to hand over the management of one of its ports to a Chinese company in 2017. Djibouti is also on record to be facing the same dilemma.
Another issue arising from the foregoing is the inability of signatories to an agreement to respect the obligations created for them in the spirit of sanctity of agreements. China is being blamed for taking over a Sri Lankan port but not looking at Sri Lanka’s non-compliance with the provisions of the MOU done with China. The question to ask is whether China’s action is inconsistent with the spirit of the agreement reached with the Government of Sri Lanka or with the Government of Djibouti. An additional question to address is this: Why is China able to manage the Sri Lankan port and generate revenues not only to eke out a good living but also able to settle existing debts? How do we explain the solvency of the port under the Chinese?
Nigeria will need to learn lessons from the examples of countries that have not been able to settle their debts to China. Is it not possible for Nigeria to default? If Nigeria defaults, what is the nature of sanctions that China would take against Nigeria? Will loans taken from China be truly applied to the productive sectors of the national economy? In fact, how well are loans managed in Nigeria?
Whatever is the case, there is something new to always learn from the Chinese mania of doing things, as distinct from the western mentality to which most Nigerians are accustomed. There is much to gain from the BRI. The challenge remains how to eventually translate the current dependency on China to manifest development and national self-reliance in the long run.