China, Belt and Road Initiative, and Bangladesh

The newspaper The Daily Star, published in Dhaka, Bangladesh, recently carried an article about China's Belt and Road Initiative (BRI). This article reads as a very positive assessment of BRI (see Notes 1 and 2; The Daily Star 2019). Essentially, reading between the lines one gets the impression that more is better. A key paragraph, titled "Making the most of BRI", is the following:

’...While the western media and some governments continue to portray the BRI as an “imperialist” approach by an emerging China, Asian economies, particularly some nations in South Asia (that includes Bangladesh) and many more in South-East Asia, have embraced the opportunity to be part of this plan because of the opportunities it presents—to upgrade outdated infrastructure, open up new trade routes, attract foreign direct investments, among others.’

The Daily Star article is interesting. What runs through it is a strong belief that this is – and certainly will be – good for Bangladesh. I believe this is correct, on the short term, that is, and, mind you, primarily for the private sector. On the longer term, for Bangladesh as a country, it may well be a different story, and certainly if what is happening in Africa is anything to judge by. Here, China is gradually becoming an important player in the economy in country after country. Enormous prime agricultural areas are leased or owned by Chinese companies. I trust we all are clear about the underlying rationale: China is not doing this out of goodness and altruism. In the classic story of Goliath versus David, China is likely to reap the major benefits on the longer term, including in Bangladesh.

I am reminded of an earlier scenario in the early 1980s, when I first arrived in Bangladesh. At the time United States had substantial influence – including power – over economy and politics, not to mention culture, in Bangladesh. Some examples: kids that saw me (a Caucasian) for the first time would point at me and say "million-dollar man", in reference to a popular TV series. The main attraction on TV, way up in a remote part of Sylhet where I lived, was American soaps ("Dallas" was especially popular), available for the very few who could afford a TV, that is. The main evening newscast regularly focused on American news. One memorable evening, after a winter storm had hit coastal California, this was the main story, and a very long one at that – I remember it because we saw the coastline of Venice, a suburb of Los Angeles where I had lived a couple of years earlier while studying at UCLA).

Global geopolitics change, and the role of United States is no longer what it was, partly due to the politics – or lack thereof – of Mr. Trump, the current occupant of the While House (although the change began years earlier, due to other factors). Brace yourself for the coming epoch of China. To "make the most" (to echo the title of The Daily Star article) of Bangladesh's underdog position, it would be a good idea to strive to balance the panegyric views with some sobering thoughts about what this will all lead to, and what to do about it.

My point here is not that China is the evil empire, intent on taking over the world, or at least developing and transition countries. I do not believe there is a hidden grand plan that is gradually unfolding. The logic behind the global economic and trade efforts of China is that it has a very large and growing population that needs to be fed, given jobs, and be educated. Further, China has few – more to the point perhaps, not enough – natural resources to support its burgeoning population. Accordingly, it ventures out in the world. The BRI is only the last and best-known initiative, and one that China's intents has come to be judged by. For a further qualification, I am not certain it is correct to place the responsibility for this solely on China as a country – I should think that the growing private sector in China, to some extent at least, acts on its own.

This push by China has been going on since several decades. An example: I worked on a World Bank project in Vietnam in the mid-90s, and it was clearly visible how enormous amounts of cheap masse-produced consumer items, mostly plastics, from China were flooding markets, from the capital down to the village-level. The same thing is happening throughout Africa, with the obvious effect that local producers are being forced out of business, which in turn increases the demand for Chinese products. These local impacts have by and large gone unnoticed by the rest of the world. Perhaps they were, and still are, considered to be too small to warrant any action. But, as I will argue below, these small changes, when taken together, amount to a very large change on micro- and macro-levels. It may only be with the advent of the BRI that the world has really begun, ever so slowly, to understand the magnitude of China's global plan.

For an assessment of the situation in Central Asia, the region of the BRI proper, a  article presents interesting analyses and conclusions (Bird, Lebrand and Venables 2020). The article state that there likely will be sizeable geographic variations in impact, with some areas receiving two-digits increase in income while other areas will stagnate or even decline. In other words, localization economies may increase regional disparities. There is no reason to assume that this analysis will not apply to South Asia and to Bangladesh in particular.

My main point is that the BRI, enormous as it is, has set in motion activities, initiatives, and actions, in economics, trade and politics, across large parts of the world, and at local, regional, national, and international levels, that we are only slowly beginning to fathom. The BRI has, as it were, acquired a life of its own. There is no grand scheme behind it except an overarching idea of, one the one hand, securing natural resources, and, on the other hand, securing markets for Chinese products.

We cannot really blame China. Western countries, including the imperialist countries in Western Europe, and above all United States, have been engaged in the very same business since a long time. As a graduate student of sociology at University of Oslo I became interested in Marxist influenced writings on this. I wrote a thesis on Andre Gunder Frank, who promoted dependency theory, and later world system theory (see Note 3). He showed how the United States was siphoning off more capital from South America than it provided by way of, among others, development cooperation. Frank's credo of sorts, "the development or underdevelopment and the underdevelopment of development" was, however, not taken seriously. China is, in a way, following suit. All imperialist countries' initiatives are alike in that they are state-sponsored, to one degree or another. The difference with China is the substantial level of state control together with the massive and concerted scale of its endeavour.

Still no alarm clocks chime. There is an increasing amount of writings on the BRI, including assessment of its likely/possible implications. Many are still very positive, like the The Daily Star article. I gather well-placed politicians and economists are gradually becoming concerned, but we do not see any solid actions coming out of this. I should add that I do not have a side in this. In a historic perspective, as argued above, the BRI is just the latest example of states taking on the world for its own benefit. What surprises me is that the old states in the Western part of the world are so passive. Do they not see that their traditional hegemony, on the longer term, is being challenged? There is one exception: Mr. Trump would appear to not have understood these current geopolitical developments. To the extent he has, it seems he does not find them relevant. To the extent he has not – which is the more likely interpretation – his actions make perhaps some sense, for the United States is now fast retreating from the world stage. American companies are of course still engaged, but without the support of the United States chances are their role may diminish.

As for the old world, the former colonial powers in continental Europe, viz. Belgium, France, Germany, Netherlands, Portugal, and United Kingdom, are today only shadows of their former glory. I should hasten to add that this is, in general, a good thing. Decolonization was, for all its ills and problems, necessary. This means, however, that these countries likely are not in a position to pose any serious challenge to the BRI.

Development cooperation and aid – which is my own metier – has always implicitly been an extended arm of the West in general, and of Western colonial powers in particular, in political, economic, and cultural terms. My own country of Norway plays a role as well, albeit in a partly different way. The unfolding processes of globalization and internationalization can to a large extent be ascribed to development cooperation and aid. But the post-WWII scenario is changing in this area as well. Already at the time I worked for the World Bank during the 90s, only a smaller part of financial transfers and investments in developing countries came through official aid, that is, through the World Bank, regional development banks, and bilateral aid. The overwhelming majority came through private sector investment. China came to the World Bank at this time to request funding for the Three Gorges Dam, but China could not – or did not want to – accept the necessary conditionalities, especially concerning the very large involuntary resettlement that would be necessary. China accordingly went on the international private financial market to secure the necessary funding. Also, in this area things are changing. The best example is perhaps the Asian Infrastructure Investment Bank (AIIB), proposed by China, and with headquarters in Beijing (see Note 4). It operates in the Asia-Pacific region. Bangladesh is a member, together with 73 other countries, as well as 26 prospective members from around the world. AIIB is widely seen as a rival to the World Bank Group, including IBRD and IMF, as well as to Asian Development Bank.

Going back to Bangladesh, its politicians would do well to focus on the longer-term impacts of its seemingly wholesale acceptance of the BRI, as well as other Chinese led or supported initiatives. The big question is, will they do it, and, if so, will they be listened to? Who is able to see into the future, and predict the longer-term consequences of the short-term decisions and wins that are offered?

The main problem, not just in Bangladesh, but around the world, and in general, not just in relation to the BRI, is that elected politicians, as well as all manner of supportive ad-hoc advisers, either in official positions or working as political consultants – and especially those with a background in economics – are hardly able to provide such advice. Politicians, once elected, are prone to act less out of conviction than out of a will to be re-elected. Economists are concerned with a very narrow slice of public politics and expenditure, namely economics, and they are, at least partly, prone to give such advice as their employers would like. Furthermore, both groups have, for different reasons, very short-term planning horizons, which to a large extent influence, or even determine, their voting and advice.

Foreseeing what will happen, in any issue that confronts us, at local, national, regional, and international levels, is becoming increasingly complicated. Globalization and internationalization are resulting in a world that is increasingly unpredictable. Cases in point: Only 10 years back, nobody would have predicted the phenomenal rise of Amazon, Facebook, and Google, and nobody foresaw the outcome of the recent presidential elections in the US, nor the referendum in United Kingdom on Brexit. The future scenario with the BRI is just one of several issue that we are – of should be – grappling with to try and understand.

As argued above, I am afraid I do not have much faith in the ability of politicians and assorted experts and political consultants to see the writing on the wall, as it were. Instead, my vote goes to individuals who are positioned outside of and apart from these political towers of influence and power. They are sometimes referred to as visionaries, and are often found in the lose category of artists, and more specifically authors, as well as among social scientists (the latter being my own tribe and creed – I am a social anthropologist). They have in common that they are concerned a priori with culture, networks, people, relationships, and social organization, and less with economics, engineering, finance, political systems, and technological innovation. Some among them have an uncanny ability to foresee what may or will come, not necessarily today or even in the near future, and not necessarily in exactly the prescribed form. Aldous Huxley's "1984" is a good example. Another one, at the present time much talked about, is Margaret Atwood. Her writing has been labelled as dystopian fiction, historical fiction, science fiction, and speculative fiction. And, of course, it is negative, it describes places and scenarios where none of us want to go. We prefer positive future scenarios. So, there must be a reason why this attracts so many people? I wonder if this interest may be exactly because of its dystopic focus? That many have become sceptical of the technological optimism, the modernization premise, and the belief that engineering and new inventions will save us all and the planet, have led to a concern with the ideas of such authors?

I may have moved away from the concern with BRI. Or maybe not. Everything is connected to everything else. Everything we do has implications, somewhere, down the line. I find the so-called 'butterfly effect' fascinating. Originally used in a novel by Ray Bradbury (Bradbury 1953), the term is now used in chaos theory, where it denotes:

"...the sensitive dependence on initial conditions in which a small change in one state of a deterministic non-linear system can result in large difference in a later state". (Wikipedia nd)

The parallel in the natural world centers around the powerful concept of 'ecosystem' (today used – and misused – in so many ways). We would all do well to understand the ideas underlying this and related concepts, realize our place and role in the larger picture, and live by this.

Lars T Soeftestad

Notes
(1) This article is based on a comment on Facebook, 14 September 2019. Thanks to Michael Roy for alerting me to it, and for his as well as x comments.
(2) The Daily Star is published in Dhaka, Bangladesh.
(3) Soeftestad, Lars. 1977. "Andre Gunder Frank, fra dependencia til akkumulasjon?" Thesis. Dept. of Sociology, University of Oslo. Note: In Norwegian, available on academia.edu.
(4) Asian Infrastructure Investment Bank. URL: https://en.wikipedia.org/wiki/Asian_Infrastructure_Investment_Bank
(5) Image credit: The Daily Star (Dhaka, Bangladesh).
(6) Permalink. URL: https://devblog.no/en/article/china-belt-and-road-initiative-and-bangladesh
(7) This article was published 14 September 2019. It was revised 6 May 2020.

Sources
Bird, Julia, Mathilde Lebrand and Anthony J. Venables. 2020. The Belt and Road Initiative: Reshaping economic geography in Central Asia? Journal of Development Economics, https://doi.org/10.1016/j.jdeveco.2020.102441  (Note: Journal Pre-proof, accessed 22 Jan 2020).
Bradbury, Ray. 1953. "A sound of thunder". Published in "The Golden apples of the sun".
The Daily Star. 2019. "Making the most of BRI". URL: https://www.thedailystar.net/opinion/no-frills/news/making-the-most-bri-1798033
Frank, Andre Gunder. URL: https://en.wikipedia.org/wiki/Andre_Gunder_Frank  (Note: accessed 15 September 2019.)
Lall, Somik V. and Mathilde Lebrand. 2020. Who wins, who loses? Understanding the spatially differentiated effects of the belt and road initiative. Journal of Development Economics. https://doi.org/10.1016/j.jdeveco.2020.102496 (Note: online availability, accessed 6 May 2020.)
Wikipedia. "Butterfly effect". URL: https://en.wikipedia.org/wiki/Butterfly_effect  (Note: accessed 15 September 2019.)