BRI Updates July 4, 2019
BRI at G-20 Summit
- The Belt and Road at the G-20 Summit in Japan:
The Chinese President Xi Jinping brought the up the role of the Belt and Road Initiative in “building a high-quality world economy” in the G-20 meeting in Osaka, Japan on June 28. In his speech, President Xi said: “The G20 is the premier forum for international economic cooperation. We, as the leaders of major economies, are duty bound to re-calibrate the direction of the world economy and global governance at this critical juncture, work together to boost market confidence, and bring hope to our people.” He emphasized the importance of thinking on a long-term basis, an idea that has been missing from the Western-dominated, short-term profit maximizing economic philosophy of the past 30 years. “We must keep in mind our shared future. In today's world, all countries' interests are closely intertwined. We have a high stake in each other's future. By expanding common interests and taking a long-term view, we can realize enduring peace and prosperity in the world and deliver a better life to all our people. We must not allow ourselves to become prisoners of short-term interests and make irrevocable mistakes of historic consequences,” Xi said.
President Xi, correctly identified the challenges and bottlenecks to development, most importantly the lack of modern infrastructure and the financing such infrastructure, stressing that the Belt and Road Initiative was meant to exactly tackle this challenge:
“Third, we need to rise up to challenges and break bottlenecks in development. The myriad challenges facing the world today are all related in one way or another to the development gap and deficit. The gaping shortfall in global development financing means that the realization of the UN 2030 Agenda for Sustainable Development remains a daunting task for us. It is against such a backdrop that China proposed the Belt and Road Initiative. The Initiative is designed to mobilize more resources, strengthen connectivity links, leverage potential growth drivers, and connect the markets with a view to integrating more countries and regions into economic globalization and achieving shared prosperity through mutually beneficial cooperation. The success of the Second Belt and Road Forum for International Cooperation demonstrates the broad welcome and support for this Initiative from the global community, as it effectively responds to the aspirations of our people and the trend of our times.”
In conclusion, President made the very important suggestion to align three important initiatives: “We need to align the joint construction of the Belt and Road Initiative with the Agenda 2063 of the AU, the UN 2030 Agenda for Sustainable Development and the development strategies of African countries, and deliver more tangible benefits to the Chinese and African people by implementing the outcomes of the Beijing Summit.”
Read the whole speech, which contains very important proposals for the growth of the world economy and achieving sustainable development here: Working Together to Build a High-Quality World Economy
- Xi Jinping Meets African leaders in Osaka
On the sidelines of the G-20 meeting in Osaka, President Xi Jinping chaired the China-Africa Leaders' meeting on June 28. The meeting was attended by South African President Cyril Ramaphosa, [former African co-chair of the Forum on China-Africa Cooperation (FOCAC)]; Egyptian President Abdel-Fattah al-Sisi, also rotating chair of the African Union (AU); Senegalese President Macky Sall, current African co-chair of the FOCAC; and Secretary-General of the United Nations (UN) António Guterres.
President Xi made a three-point proposal:
First: align the joint construction of the Belt and Road Initiative with the Agenda 2063 of the AU, the UN 2030 Agenda for Sustainable Development and the development strategies of African countries.
Second: Taking the lead in opening up and cooperation to pool stronger synergy for Africa's development. International cooperation with Africa should give priority to Africa, respect its will and safeguard its interests. Any self-claimed supremacy practice, self-centered egotism and selfish behavior at the expense of others wins the hearts of no one and is undesirable.
Third: Champion multilateralism and make greater contributions to upholding the international order. “We should uphold the diversity of civilizations and inclusive development, uphold the principle of extensive consultation, joint contribution and shared benefits, join hands to promote process of democratization of international relations, take a clear stand against protectionism, unilateralism, bullying and clash of civilizations, jointly safeguard multilateralism and free trade system, fully accommodate the reasonable demands and legitimate interests of developing countries, especially African countries and actively maintain international fairness and justice” Xi said.
President Xi made several pledged to the African leaders: 1. China will support Africa's development unremittingly to make greater contributions to Africa's development, revitalization, unification and self-improvement. 2. The Chinese side is ready to push the international community to increase investment in Africa, work with the UN to help African countries properly cope with global challenges, and conduct trilateral cooperation in Africa with the UN and international partners on the basis of respecting the African side's will. 3. The Chinese side will speak up for African countries at the UN and other multilateral arenas, push for more resources to be allocated to Africa, continue to promote the UN to fund Africa's own peacekeeping operations, and make unremitting efforts for Africa's long-term stability, development and prosperity.
- China biennial Trade Expo will boost reciprocal trade with Africa
China-Africa Economic and Trade Expo took place June 18 and 20 in Changsha, the capital of central China’s Hunan province. At least 20 African political and government leasers were among the attendees, interacting with representatives from over 50 African nations, and thousands of trade reps. The expo is part of eight initiatives proposed by president Xi Jinping during last September’s Forum on China–Africa Cooperation (FOCAC) in Beijing, based on China's “win-win” strategy of collaboration.
- Uganda’s President Museveni Explains Why Africa Is Turning to China, During Beijing Visit
June 27 (EIRNS)—Chinese President Xi Jinping and Ugandan President Yoweri Museveni agreed when they met on June 25 in Beijing to lift relations between their nations to a comprehensive cooperative partnership, during what Museveni described as his four-day working visit, June 24-27. “China is willing to strengthen exchanges with Uganda on the experience of governance, and deepen cooperation in areas such as infrastructure construction, trade, energy, agriculture, epidemic prevention and control, human resources, industrial parks and tourism,” Xi told Museveni, Xinhua reported.
Earlier on June 25, Museveni had lashed out at the World Bank for refusing to support Uganda’s railway projects. He reported in his keynote to the Coordinators Meeting on the Implementation of the Follow-up Actions adopted at last year’s Beijing Summit of the Forum on China-Africa Cooperation (FOCAC), that “one of our engineers recently told me that the Uganda Railways tried in vain to get support from the World Bank until one official told them that countries that build railways do so with ‘their own money.’ How will the private-sector grow if it is bedeviled with expensive transport costs, expensive electricity costs or no electricity at all, expensive cost of money, etc.? It is against that negativity, that China’s solidarity should be measured,” President Museveni asserted.
Museveni also presided over the opening of the first-ever China-Africa Economic and Trade Expo, in Hunan Province. The expo had been proposed at the Sept. 3-4, 2018 FOCAC summit in Beijing, and is seen as “a new mechanism for commercial cooperation with Africa, a new platform to deliver the trade and economic measures of FOCAC, and a new window for sub-national business cooperation with Africa.”
- East African SGR is still on the agenda.
One of the issues that have been debated on the BRI progress in Africa is the extension of the China-built and financed Kenyan Standard Gauge Railway (SGR) to Uganda, South SUdan, Rwanda and Burundi, which is part of the East African SGR Master Plan. Differences on financing and coordination of the the work between the different states has stalled the project. This is one of the issues that President of Uganda discussed with his Chinese counterparts during his recent visit to Beijing. According to Kenyan media reports, China has asked Kenya and Uganda to work on their respective financing modalities for the joint railway in order to receive funding for the project, Ugandan Finance Minister Matia Kasaija has said. According to these reports, Mr. Kasaija said that China has always been “ready to give us the funds to start the construction of SGR in Uganda, but there have been some complications between us with our neighbour Kenya. Kenya is supposed to extend the line to Malaba, but they have not been able to do so.” The Nation of Kenya reports that although Kenya has completed the initial SGR phase linking Mombasa to Nairobi, and has progressed with the second phase from Nairobi to Naivasha, the fate of the subsequent phases from Naivasha to Kisumu and then to Malaba at the Ugandan border hangs in the balance.
The Nation reports that Mr. Kasaija was "speaking to The EastAfrican last week on the sidelines of the First China-Africa Trade Expo in Changsha, the capital of central China’s Hunan Province, where he said that a delegation from Kampala led by President Yoweri Museveni held talks with China’s Minister for Commerce, officials of Exim Bank and Kenya’s Transport Cabinet Secretary James Macharia to see how the project could be implemented."
“We have not yet got the funding and the meeting between us, Kenya and Beijing concluded that there is money but each country needs to work on its financial modalities of the railway project before money is releases,” said Mr Kasaija.
One of the controversial issues that has stalled the project is Uganda's decision to revamp its local "metre gauge" line and invested $205 million in restoring it. This gauge is not compatible with the SGR, a matter which raised questions in neighboring country Kenya. But Mr Macharia told The EastAfrican in Beijing that the SGR is a regional project, and all hope is not lost. He said that while the timelines for completing the project may have changed, they are not abandoning it as there is hope of China releasing the funds soon. “Kenya is the entry of the SGR, which runs from Lamu-Mombasa-Naivasha-Kisumu-Lake Victoria all the way to the Atlantic Ocean in West Africa. “In fact, the funds were approved by the Chinese Ministry of Commerce and are now with Exim Bank, which is looking into financial dynamics of lending according to the structure of each country,” he added.
- Business booming on the SGR: Kenya seeks to streamline operations at Mombasa and Nairobi terminals
The Kenya Ports Authority is seeking bids for a company to develop an "enhanced operating system" for the port facility in Mombasa, and the "inland port" in Nairobi, the current terminous point of the SGR rail line. KPA recently purged 20 companies from the ports management, as part of the streamlining operation. Read report in Business Daily Africa!
- Thanks to Chinese-Spanish Cooperation, Grand Inga Mega Hydroelectric Project takes major step forward.
Congolese authorities have taken the first step toward realization of a huge hydropower project near the base of the Congo River, after securing of $73Mn from the African Development Bank for a feasibility study for the Grand Inga Mega Hydroelectric Project. When completed, the dam would provide 11,000 MW of power, at a cost of $18Bn, providing power to the DRC and neighbouring countries. This will revolutionize the economy of the DRC, where the per capita consumption of electricity is only 108 kWh (compared to Algeria with 1350 kWh, or Sweden with 13000 kWh).
The AfDB financing came as a result of the agreement between Chinese and Spanish companies to design, finance and build the mega dam. The consortium consists of the Chinese companies China Three Gorges Corporation (CTG) and Sinohydro and the Spanish company Actividades de Construcción y Servicios (ACS). The total capacity of power generation of the Congo River is 100,000 MW, and the Inga Dam series is 40,000 MW, which would make the largest in the world if completed.
- China and South Africa Advance Partnership for Space Exploration
July 1 (EIRNS)—On the sidelines of the China-Africa Cooperation (FOCAC) Coordinators’ Meeting on June 25, China’s Foreign Minister Wang Yi and South Africa’s Foreign Minister Naledi Pandor signed a partnership agreement for work on the Square Kilometer Array (SKA) radio telescope.
The SKA Organization was founded in 2011, and now involves organizations from 13 member states (Australia, Canada, China, France, Germany, India, Italy, New Zealand, South Africa, Spain, Sweden, the Netherlands and the United Kingdom): The SKA itself will eventually involve a network of radio telescopes spanning 1,000 square meters of “lens” spread over two continents, Australia and Africa. The control center is located in the United Kingdom. The SKA Observatory, to oversee delivery of the radio telescope, was made a treaty organization in March 2019, reported the SKA Organization.
Integrating the numerous lenses will be a network of super-computers, scanning the sky “10,000 times faster than and with 50 times the sensitivity of any radio instrument on Earth.” Expected to be fully operational in 2024, several segments have already been built, with more in view.
The bilateral agreement heralded the signing of a memorandum of understanding between the South African Radio Astronomy Observation (SARAO) and National Astronomical Observatory, and the Chinese Academy of Sciences in respect of the Radio Astronomy Research Exchange Program, according to Space in Africa news agency.
“What’s really important is for China to partner with South Africa and many other countries across the world in the Square Kilometer Array. The Astronomy Institute of China has signed the agreement, and it’s a commitment to fully participate in the process of building this mega radio telescope,” she told Space in Africa. “We are also going to see young people from South Africa coming to China for postgraduate studies in astronomy sciences, in astrophysics, in mathematics and engineering.”
- Strengthening of Ties Between China and Japan Is under Discussion
June 27 (EIRNS)—Inviting Chinese President Xi Jinping for a state visit to Japan during their meeting today in Osaka before the start of the G20 summit, Prime Minister Shinzo Abe said he wanted Japan to elevate ties with China and create a new era for Asia’s biggest economies. “Around the time of the cherry blossoms next spring, I would like to welcome President Xi as a state guest to Japan, and hope to further elevate ties between Japan and China to the next level,” Abe told Xi, Reuters reported. Xi immediately responded that “it is a good idea,” the Japan Times reported.
China’s Global Times special business coverage on June 25 also emphasized the importance of stronger China-Japan relations. “Beliefs are also firmly held that wide-ranging China-Japan cooperation, especially the bonds between the two nations concerning the exploration of business opportunities in third markets, will continue on its forward trajectory despite trade tensions between the U.S. and other economies, notably China.”
Global Times, in other coverage, cited Eiichi Shindo, head of the Belt and Road Initiative at the Japan Research Center, saying that since the Belt and Road Initiative fits well into the vision for third country business cooperation between both nations, perhaps the Japanese government, while pushing for the Indo-Pacific strategy, could open its mind a bit. “Japanese companies have begun to understand the potentially huge market involving projects under the China-proposed BRI,” Shindo said.
- U.A.E.’s Etihad National Railway Plan Advances
June 27 (EIRNS)— Etihad Rail, the developer and operator of the U.A.E.’s national railway, has awarded $1.2 billion of civil and rail engineering work to the China Railway Construction Corporation and the Abu Dhabi-based infrastructure company Ghantoot Transport & General Contracting. The two will work on the second two “packages” of the section of U.A.E.’s national railway network which will run from Ghuweifat on the western border with Saudi Arabia to the Port of Fujairah on the eastern border with Oman, Global Construction Review reported June 26.
Shaikh Theyab bin Mohamed, chairman of Etihad Rail, said the project “will sustain the growth of our transport industry and freight carriage sector throughout the U.A.E., as railway systems are one of the most important means of transport on which countries depend to achieve their economic and social objectives.”
When completed, the 1,200 km Etihad Rail project will become a key part of a railway network throughout the Gulf Cooperation Council. The first package for this stage of the U.A.E. National Rail Network is being built by a joint venture of China State Construction Engineering Corporation and South Korea’s SK Engineering and Construction.
- World Bank issue report on the BRI: World Bank has just issued Belt and Road Economics: Opportunities and Risks of Transport Corridors which is a major research document focused on the transport section of the BRI. The BRIX has not yet reviewed this report.