First of the five connectivities should not be forgotten

By Tim Summers | China Daily | Updated: 2019-02-22 08:50

Seeing the Belt and Road Initiative as a platform for commercial and economic cooperation is at the heart of the policy coordination between the UK and China

The Belt and Road Initiative will once again be the center of attention when the second Belt and Road Forum for International Cooperation is hosted in Beijing in April. For many observers, the initiative is primarily about infrastructure, a framework for the promotion of connectivity to be delivered by Chinese investment in ports, railways and energy projects.

But infrastructure is just one aspect of this ambitious shared development initiative. The first of the five so-called "connectivities" is policy coordination, which has perhaps received the least attention among the five.

This may be because in many ways it is the most challenging. There may be some controversy or debate over the geopolitical implications of the other four: promoting infrastructure, trade, finance and people-to-people bonds. But their goals of enhancing global social and economic interaction reflect the ideas behind globalization which have been promoted by mainstream opinion across the world, at least until the recent emergence of anti-globalization forces in the United States and elsewhere.

As envisaged in the Chinese government's statements, policy coordination is an important part of promoting the other connectivities. Without coordination at the policy level, it is difficult to make infrastructure connectivity effective and efficient, or to promote trade in a mutually beneficial way.

But at the same time, it seems that the policy coordination element of the Belt and Road Initiative is envisioned as being more than just the bureaucratic glue which sticks the other connectivities together.

In his speech at the first Belt and Road Forum for International Cooperation in May 2017, Chinese President Xi Jinping referred to "enhanced coordination with the policy initiatives of relevant countries" and to promoting "complementarity between China's development plan" and those of other countries. The examples he gave ranged from the development plans of Laos, Cambodia, Myanmar and Hungary, to more specific initiatives by Russia, the Association of Southeast Asian Nations, Kazakhstan, Turkey, Mongolia, Vietnam, Poland and the United Kingdom.

The reference to the United Kingdom was to the so-called Northern Powerhouse, an initiative developed after 2010 to boost growth across cities in the north of England by investing in skills, innovation and transport infrastructure. But as an initiative, the Northern Powerhouse has rather dropped off the agenda since the 2017 general election, even though its goals retain broad approval.

This example shows the challenges of developing coordination between specific policies under the Belt and Road Initiative, and highlights the more general point that the initiative has already and is always going to have to respond flexibly to political and policy changes in participating countries.

But this aside, the space for policy coordination between China and the UK under the Belt and Road Initiative remains strong.

Given the UK's geographical location, it is clear than in many cases that the opportunity is not simply about physical infrastructure, though there is plenty of UK-China cooperation in infrastructure, including through the UK-China Infrastructure Academy (launched in December 2016) and building UK-China cooperation on infrastructure development in third-party markets. More broadly, the opportunities come from leveraging the comparative advantages of the UK and China as economic policy and development plans are taken forward.

Speaking at the first Belt and Road Forum for International Cooperation two years ago, the UK finance minister Philip Hammond described the UK and China as "natural partners" and said that the Belt and Road Initiative was an opportunity to strengthen bilateral ties.

On her visit to China at the beginning of 2018, UK Prime Minister Theresa May reiterated the idea that Britain and China were "natural partners" under the Belt and Road Initiative, and suggested that the initiative provided an opportunity "to further prosperity and sustainable development across Asia and the wider world". She cited the Asian Infrastructure Investment Bank as a mechanism for taking this forward.

Subsequently, trade minister Baroness Fairhead made clear at the May 2018 Silk Road Expo in Xi'an that the UK's external trade and investment policy, based on the strengths of British businesses, is developing in a way which fits China's development under the initiative. From a British perspective, strengths in financial services, high-end manufacturing, and consumer-focused sectors including education, provide a good foundation for further collaboration with China.

Seeing the Belt and Road Initiative as a platform for commercial and economic cooperation can be seen to be at the heart of policy coordination between the UK and China. It draws on the common goals that the two countries have, using the framework of the Belt and Road Initiative as a means of taking them forward.

At the same time, the challenges are not to be ignored.

Uncertainty surrounding the impact of the UK's impending departure from the European Union is likely to remain the dominant theme in British policymaking through 2019 and beyond. And over the last two years, trade tensions and broader strategic rivalry between the United States and China have grown. These more complex US-China relations will have implications for countries such as the UK.

All of this means that the policy dialogue between the UK and China will need to be flexible in both form and substance. They should provide a broad framework within which different parts of the two countries' bureaucracies and business communities can work together for mutual benefit. Rather than grand agreements, the symbols of success will be seen in specific deals done and concrete objectives achieved.

This year's Belt and Road Forum for International Cooperation provides a "top-down" opportunity to reflect on the progress to date. But the "bottom-up" work of building connectivity across policy, infrastructure, trade, finance and people-to-people ties is where the real effort is needed over the coming years.

The author is senior consulting fellow on the Asia-Pacific Programme at Chatham House, and lecturer at the Centre for China Studies at the Chinese University of Hong Kong. The author contributed this article to China Watch, a think tank powered by China Daily. The views do not necessarily reflect those of China Daily.