Treating the doubts over China-Pakistan Economic Corridor with a cool head
Recently some have cast doubts on the prospect of the China-Pakistan Economic Corridor, worried that loans from China could ensnare Pakistan into a debt crisis, among others. Imran Khan’s victory in Pakistan's election on Thursday and the ensuing government change have done nothing to ease their concerns. As a matter of fact, as a reciprocal development strategy, the CPEC has gone through long-term scientific appraisal from both countries. Certain challenges and problems arising from the advancement of this program would not perturb its bright prospects, much less influence China and Pakistan's all-weather strategic partnership.
Four disputes surround CPEC
Disputes surrounding the CPEC are generally centered on four issues. First, the debt problem, with many in the west claiming that CPEC has exerted negative influence or impact on Pakistan’s economic development and political and security situation. They argue that given its current economic development stage and the government’s governing capacity, Pakistan would be drawn into a debt trap as China’s massive loans to the country would eventually be paid back to China with interest. Western media even declared that Pakistan hopes China to offer additional loans in the face of accumulative debt risks and a shortage in foreign exchange reserve, otherwise the South Asian country would be forced to seek help from International Monetary Fund. Besides they hyped that Chinese companies, workers and commodities are flooding into Pakistan in the name of the CPEC, which would deal a strong blow to local companies.
Pakistan Finance Minister Shamshad Akhtar issued a clarification, stressing that Pakistan would unswervingly push the development of the CPEC forward. Meanwhile, citing Pakistan's reserve shortage, Chinese Foreign Ministry has expressed confidence in Pakistan's ability to overcome difficulties of the moment and maintain steady economic growth.
Second, critics raise doubts about the distribution of the CPEC projects, which boils down to the question of Pakistan's development priority. Although China and Pakistan have foreseen and taken care of this issue by showing consideration for smaller provinces in matter of priorities, location of power grid and special economic zones, the allocation of CPEC projects is subject, more or less, to the sway of competition among political parties and local governments. Nonetheless, the "early harvest" projects have smoothly advanced and shown that materializing and finishing other CPEC projects as planned by 2030 would help deliver stability to a Pakistan that suffers from strained relations among its different provinces and regions.
Third, a certain number of opinion leaders continue to nag that China would benefit way more from the CPEC than Pakistan. Sticking to the short-term returns some economists allege that Pakistan's interests are damaged so long as China gains more than 50 percent of the profit, irrespective of the CPEC's boost to Pakistan's economic growth and employment.
Compared with short-term projects benefits, more attention should be paid to the project’s long-term contribution to the local society and overall economic development. Actually Pakistan has gained much more than China in many CPEC projects, and the profits from the program would be enough to repay the loans from China, as well as promote the country's economic development.
Last comes the problem of policy continuity. CNN recently commented that some see a Imran Khan victory in election as a potential watershed moment for Pakistan as Khan's politics significantly diverges from the incumbent Pakistan Muslim League-Nawaz party and Pakistan People's Party, another major party in Pakistan. As Khan pays closer attention to the alleged corruption in the CPEC projects, a shift of attitude toward the CPEC under Khan's new government is projected. In reality, Khan doesn't hold grudge against the CPEC itself, rather he has openly stated that China and Pakistan's economic cooperation would greatly promote the latter's economic development, benefiting Pakistanis along the way. The CPEC, which is reciprocal in its nature, should in no way be changed or disturbed.
China, Pakistan friendship endures challenges
While among the doubts concerning the CPEC, some are baseless and of ulterior motive, some are undeniably constructive. Yet it should be noted that China and Pakistan could remove disturbances and barriers and meet the economic, diplomatic and security challenges arising from the CPEC. To smoothly proceed with the program and resolve the misunderstandings and conflicts within, China should take reasonable and effective measures.
First, China should give full consideration to Pakistan's ability to take on the projects and endeavor to connect with Pakistan's development needs. Apart from energy and infrastructure construction, it should carry out thorough investigations of Pakistan's actual needs and seek to help Pakistan resolve its development dilemma by integrating the CPEC with Pakistan's national development strategy and facilitating the country in developing export-oriented economy.
In accordance with the accusations from the Pakistani media that the CPEC would place a huge debt burden on Pakistan and Pakistani people are not actively involved in the program, China could consider appropriately extending the duration of the loans to Pakistan.
Second, China and Pakistan should spare no effort in involving more Pakistani people in the construction of the CPEC. It would help them recognize the essentialness of the program while offering them job openings. At the same time, the two countries should promote the construction of schools, hospitals and public facilities that are closely related to the public's daily lives, so as to lay a solid foundation of public support for the CPEC.
Third, it is of vital importance to air China's voice and spread the truth about Sino-Pakistani economy cooperation including the CPEC. China should give a full display to the goals and results of the CPEC through a series of measures including an upgrade of publicity concepts and broadening of publicity channels. Malicious misrepresentations and untrue allegations should be given the lie to in time.
In addition, China and Pakistan should expand their exchanges and communications among the people and cultivate talents for future development of bilateral relations, thus creating a conducive public opinion environment for the CPEC.
Last but not least, China should enhance the strategic coordination with Pakistan's new government and further clarify the purpose of the CPEC, which is to promote Pakistan's, also the region's, development. The non-political nature and inclusiveness of the CPEC should be emphasized to avoid upsetting other countries. Besides, the two countries should take potent measure to strike down on the extremist and terrorist forces to provide security for the advancement of the CPEC.
The author is a research fellow at the China Institutes of Contemporary International Relations.