The so called ‘One Belt, One Road’ initiative is a plan by China to foster stronger cooperation and connectivity with other countries in Europe and Asia. Andreas Grimmel and Susanne My Giang write that the initiative has the potential to unlock a new kind of integration that focuses not only on bringing states within regions together, but also forging strong links between regions

Grimmel, Andreas

My Giang, Susanne

LSE Research Online

11/04/2017Why China’s ‘One Belt, One Road’ initiative should be takenmore seriously by the EUblogs.lse.ac.uk /europpblog/2017/04/11/why-chinas-one-belt-one-road-initiative-should-be-taken-more-seriously-by-the-eu/The so called ‘One Belt, One Road’ initiative is a plan by China to foster stronger cooperation andconnectivity with other countries in Europe and Asia. Andreas Grimmel and Susanne My Giangwrite that the initiative has the potential to unlock a new kind of integration that focuses not only onbringing states within regions together, but also forging strong links between regions.EU-China partnership – Credits: Friends of Europe (CC BY-SA 2.0)Regional integration projects play a central role in international relations. Today, there is barely any region in theworld that is not decisively shaped by such integration projects in the fields of politics, law, economics, and society.However, regional integration does not only influence the nation state and its actors, but also the relationshipbetween different regions themselves.The One Belt, One Road initiative (OBOR) launched by China in 2013 sets a new milestone in this trend of regionalintegration in three different respects: first, through its ambitious agenda to connect Asia with Europe by acomprehensive trade and infrastructure project; second, its far geographical reach, potentially encompassing morethan 60 countries; and third, in that it is a project that aims at both regional and interregional integration from theoutset. On this basis, the initiative has the potential to bring about a new type integration: a merger of regionalismand interregionalism that would significantly differ from other integration projects like the EU, the ASEAN, the1/4ECOWAS, or the EAEU.What is new and most striking about this “Chinese Way”, expressed in Beijing’s approach towards inter-regionalism,is first and foremost its economically driven pragmatism that is not limited to a certain narrowly defined region, but ispotentially designed to engage in various forms of trans and (hybrid) interregionalism right from the outset. In thisrespect, at least, the initiative seems to match the global nature of the most pressing challenges – such as financialturmoil, crises of the international markets, resources, environmental issues – more appropriately than regionalintegration projects, since these that have been established in quite different historical and world-politicalcircumstances.But the rise of nationalist politics, bilateralism and preferential trade agreements also make it necessary to take theChinese initiative seriously, since it has the potential to open up perspectives for a more multipolar form of globalgovernance and the return to more liberal regulations and trade relations that avoid the well-known drawbacks ofpreferential trade agreements.How should the European Union react?Beijing’s grand project has been frequently abridged as mainly a chance for China to access new markets foroverseas sales or a geopolitical strategy. This view, however, falls short and neglects the many facets of theinitiative. And it also overlooks that the initiative can also offer fresh perspectives for the European Union. It shouldtherefore be taken more seriously than it has been so far by EU institutions and member state governments. Moreconcretely, the EU should consider the OBOR as a double chance: first, to take a more active role in shapinginternational relations again, and second, to work towards a more liberal and multilateral international trade regimeand withstand highly protectionist preferential trade arrangements – such as TTIP and other “mega-regionals” – thatmark a clear departure from the multilateral approach of the WTO.In light of the EU’s recent crises and the rather troublesome nature of current transatlantic relations, China’s timing isgood to make a convincing case for its project to establish a stronger connection between Asia and Europe. This isparticularly the case given China is the second largest trade partner of the EU and the transactions (not only intrade) between the EU and China are constantly rising, and will sooner or later need more sustainable programmesand institutional arrangements to allow for efficient and fair mutual exchange.So why is the EU still astonishingly reluctant toward engaging with the initiative? And how should it react in light of itscurrent situation? One reason for the EU’s reluctance is that the OBOR strategy is still in its initial developmentphase and only scarce details are available about how it should work in practice. At the same time, it is obvious thatthe Chinese government has not only strong feelings about reviving the old Silk Route, but is persistently workingtowards convincing new partners to participate in the project and to explore options for cooperation. At this agendasetting stage, the EU would benefit from actively engaging with the project to shape it and bring in its own ideas andpositions. It could also help clarify important issues such as the concrete legal and political framework the initiativemay be based on.The answers to these questions are crucial, since it must be remembered that the EU is much more than a tradebloc. It is also a political and legal community that is constituted through a number of institutions and an acquiscommunautaire that will create demands with regards to the compliance with established standards and norms.In other words, if China is serious about its ambitious project, it has to adopt a holistic approach to convince theirhesitant European partners as the EU will have to maintain its accumulated legislation, legal acts, and judicialdecisions. The EU will want to establish a broader legal, judicial, and maybe even political framework. And thealternative? It will be not much more than “business as usual”, i.e. mere cooperation in trade that already existsbetween Europe and Asia, and that will not need a far-reaching initiative like the OBOR.What is necessary to make the One Belt, One Road Initiative work?2/4If even just a part of the project works out as China envisions, the initiative could have vast positive effects for theChinese and global economy, and especially for infrastructural and political developments along the revived silk roadeconomic belt and the maritime silk road. Especially for the decelerating Chinese economy, the OBOR could providenew impetus. However, with regard to the size and scope of the initiative, and the numerous partners involved, asuccessful realisation will depend on four crucial aspects:First, the OBOR aims to be a multilateral initiative based on mutual agreements and benefits for all partners.However, it is necessary to formalise these objectives and formulate concrete agreements to make sure thiscommitment finds its way into the initative’s future practice. In other words, the OBOR needs a solid legal andpolitical – not just economic and financial – basis. A one-sided approach to developing new markets for China alonewill not attract the EU, nor many of the other 65 potential partner countries.Second, the Chinese initiative is a great chance to stabilise and enhance EU-China trade relations and couldfunction as a gateway for further reforms and deeper political cooperation. The EU should seize this opportunity andenter into dialogue with China on equal terms. The EU’s willingness engage with the project, however, will largelydepend on the specification of the legal and political institutional framework.Third, and more specifically, although the initiative is primarily based on the idea of eliminating trade barriers andstrengthening diverse fields of mutual investment areas, the “rules of the game” must be clarified; and they must betransparent in a way that allows for a critical public debate. The OBOR should not try to be just another preferentialarrangement like TTIP or TPP, and it would be well advised to not repeat the same flaws. The broad public protestsagainst such agreements in Europe have clearly shown that large parts of European society are unwilling to acceptnon-transparent trade policies and lower standards (such as in the field of consumer and environmental protection).Fourth, and with regards to the size of the project, there will be enormous investment needed. It is envisaged thatone part of the financing will be provided by the Asian Infrastructure Investment Bank (AIIB) and the NewDevelopment Bank (NDB). But the means provided by these institutions will not be enough. For a realisticimplementation of the initiative, other investors are needed. Furthermore, this also means that the projects to berealised must be carefully selected on the basis of their practical and sustainable use, and they must be monitored toavoid money trickling away within large scale projects due to corruption and a lack of transparency.Making the OBOR initiative a successThe OBOR is meant to be an open, harmonious, inclusive and respectful market driven initiative , which aims to be inline with the UN Charter and to be of mutual benefit for all parties. The initiative outlines policy coordination, facilityconnectivity, unimpeded trade, financial integration and establishing new bonds between people as its five majorpriorities. In this ambitious framework, it offers innovative perspectives not only for economic development, but alsofor deeper cooperation and integration of the OBOR countries. Nevertheless, it is necessary that the initiative will notbe reduced to a mere trade agreement, and that it will avoid repeating the flaws of preferential trade agreements likeTTIP and TPP. The One Belt, One Road Initiative has the potential to be something new and the first comprehensiveinterregional project, but China and the EU will have to work together on it to make it a success.Please read our comments policy before commenting .Note: This article gives the views of the authors, and not the position of EUROPP – European Politics and Policy, norof the London School of Economics._________________________________About the authors3/4Andreas Grimmel – Universität HamburgAndreas Grimmel is Research Associate and Lecturer at the Institute for Political Science atUniversität Hamburg and at the Institute for European Integration, Europa-Kolleg in Hamburg. Hecurrently is a Visiting Scholar at the Fudan Development Institute (FDDI) in Shanghai. His researchincludes European Union politics and European integration, regional integration, internationalorganizations as well as political theory and philosophy.Susanne My Giang – Universität HamburgSusanne My Giang is a PhD candidate at Universität Hamburg, Institute for Political Science. Shehas studied Political Science and Southeast Asia Studies and currently is a Visiting Scholar at theFudan Development Institute (FDDI) in Shanghai. Her main research fields are energy systemtransformation as well as environmental and climate policy in Southeast Asia.4/4

Why China’s ‘One Belt, One Road’ initiative should be taken more seriously by the EU

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