The UNCTAD Belt and Road Initiative–named after the mammoth Chinese infrastructure project to connect more than 120 countries in Asia-Pacific, Europe and Africa–will focus on four main areas: trade, foreign direct investment (FDI), finance and the digital economy.
While China’s multibillion-dollar initiative focuses on hard infrastructure like highways, railways and power grids, UNCTAD’s platform will concentrate on so-called “soft linkages” needed for policy knowledge sharing, according to UNCTAD economist Rashmi Banga.
“The platform will share China’s policy experiences with other developing countries, especially the policies which helped with China’s structural transformation,” Banga said. “It is no surprise that many nations want to learn from China’s ascent and understand how it managed to lift millions out of poverty, achieve sustained growth and become a digital leader.”
There are many lessons to be taken from the Belt and Road initiative for developing countries, Banga said, especially as countries look at closer regional integration in response to market and finance shrinkages.
UNCTAD, which had a soft rollout of its plan last week at the second High-Level UN Conference on South-South Cooperation in Buenos Aires, said it will officially launch the platform on April 28 in Beijing after China’s second Belt and Road Initiative Forum.
Over the past 30 years, observers have seen China transform, first by a slow opening, then by advancing its socialist market economy, and now through the elaborate One Belt One Road attempt to establish a global unified market, UNCTAD said. Regional integration, such as the Belt and Road Initiative, is expected to provide opportunities for developing countries to structurally transform and deliver on their sustainable development goals.
“The platform is exactly what developing countries need,” Lesotho’s ambassador to the UN in Geneva, Mojalefa Litjobo, said.
Adding to that, African Union commissioner for trade and industry Albert Muchanga said, “Knowledge sharing among countries and connecting people is of critical importance for development.”
The Belt and Road initiative is an interconnected mechanism for a unified large market that primarily addresses an infrastructure gap in beneficiary countries, according to UNCTAD. China’s infrastructure development policies and investments in places and industry like Africa’s growing apparel and textile sector have helped them to modernize. Now these lessons can help in other markets, Banga noted.
“UNCTAD is running a pilot project in Ethiopia, Indonesia and Sri Lanka designed to adapt successful Chinese policies to local conditions,” she said, adding that China supports the plan.
“Adapting Chinese practices and policies to local conditions of partner developing countries can be an extremely important element of UNCTAD’s Belt and Road Initiative platform,” said Zhang Yi, deputy director-general of the China International Center for Economic and Technical Exchanges, in the Chinese Ministry of Commerce. However, he added that “simple copy and paste won’t work” and that policies need to be adapted to local conditions. UNCTAD’s Dawei Wang added that developing countries need space for experimentation and the platform would facilitate both that and peer-to-peer learning.
What’s more, said Debapriya Bhattacharya, chair of Southern Voice, an international network of think tanks, “The platform will help increase transparency, effectiveness and accountability.”
Pakistani parliamentary secretary for foreign affairs, Andleeb Abbas, said such sharing and interdependence can also translate into less conflict between countries.
FDI of Chinese companies in 56 counties participating in the One Belt One Road initiative stood at $15 billion in 2018, up 8.9 percent compared to the previous year, according to figures released in January by China’s Ministry of Commerce.