The recent Chinese investment in Donald Trump’s hotel project in Indonesia is just one in a long string of Chinese ventures across the globe. This deal, between a Chinese state-owned company and an Indonesian developer, falls under the umbrella of China’s One Belt One Road initiative.
One Belt One Road is an ambitious effort to spread the country’s money and influence around the world. The Chinese see it as an extension of their foreign policy: projecting soft power through the financing and construction of infrastructure and other projects.
In this week’s WhoWhatWhy podcast, Jeff Schechtman talks with journalist Will Doig, who covers urban development, transportation, and infrastructure, was international editor at Next City, and wrote the weekly “Dream City” column for Salon. Doig talks in detail about China’s attempt to pull half the world into its orbit through One Belt One Road.
According to Doig, this is a kind of Chinese Marshall Plan. By lending money to other nations for once-in-a lifetime infrastructure projects, China makes these indebted nations more beholden to its wishes.
One example is the massive Southeast Asia railway project currently underway. Building the railroad through rural areas in Southeast Asia fosters urbanization along the route. The growth of these new communities creates more building and selling opportunities for China. Moreover, these are projects whose complexity requires Chinese labor, technology, and supply chains.
Doig tells Schechtman that the government of President Xi Jinping works on a very long time scale. The Chinese are happy to build cities today that may not fill up for 20 or 30 years — a time when they see themselves as the dominant power in the world.
Doig is the author of High-Speed Empire: Chinese Expansion and the Future of Southeast Asia (Columbia Global Reports, May 1, 2018).
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Jeff Schechtman: Welcome to Radio WhoWhatWhy. I’m Jeff Schechtman. We hear over and over in our domestic political debates about the need to improve America’s infrastructure, that to do so is good for business and in the big picture, good for the economy and a projection of America as a global leader. Certainly, LaGuardia Airport and the 45 years it took to build the Second Avenue Subway in New York are not good indications.
Jeff Schechtman: On the other side of the world, few countries have repeatedly taken on infrastructure projects as big as those taken on by China. From the movement of water to the transportation of people, the Chinese have seen infrastructure not only as good for its internal economy, but as a true projection of pride and power. Now, these projects have pierced the Chinese border in the form of China’s One Belt, One Road project. The question is, has China gone a railroad bridge too far?
Jeff Schechtman: We’re going to talk about this with my guest Will Doig. Will is a journalist that has covered urban development. He’s been an editor at the Open Society Foundation, Next City, and The Daily Beast. He created and wrote Salon‘s weekly Dream City column and has been a repeated guest on NPR’s Talk of the Nation. His work has appeared in dozens of magazines, and his new book just out from Columbia Global Reports is High-Speed Empire: Chinese Expansion and the Future of Southeast Asia. Will Doig, thank you so much for joining us on Radio WhoWhatWhy.
Will Doig: Thanks for having me.
Jeff Schechtman: It’s great to have you here, with the heart of what you talk about in terms of this Chinese expansion of infrastructure is this One Belt, One Road project. Explain to our listeners first what that is.
Will Doig: Sure. So One Belt, One Road, in short it’s China’s plan to cover half of the world in Chinese built infrastructure — airports, seaports, highways, energy corridors, pretty much everything you could imagine, and in all kind of forms of network of supply chains and transportation routes, all of that kind of flowing back to China. The two parts of it are the belt and the road. The belt part is the land routes that cover Asia and go all the way through the Middle East and ultimately to Europe. The road is actually the maritime portion of it, which was a series of shipping lanes that go through the Pacific, the Atlantic, the Indian Ocean, and hook up with seaports all over the world.
Will Doig: It’s at heart an economic strategy, but it’s also a stand-in for Chinese foreign policy in a lot of ways. I mean, China doesn’t really separate those two spheres nearly as much as the United States does. In a way, this project is China’s way of reaching out to the world. China is the country that doesn’t form traditional alliances in the same way that many other countries do. They prefer partnerships and often those partnerships are based on trade. So, this One Belt, One Road project is really a mechanism for them doing that.
Jeff Schechtman: This notion of using infrastructure as a projection of global power, talk a little bit about how that’s evolved in the Chinese consciousness and really in the current Chinese foreign policy?
Will Doig: There’s a couple of ways that China uses infrastructure to project power. One of them is it’s really its soft power mechanism. I mean, Chinese culture doesn’t penetrate the rest of the world in the same way that say American culture does. There’s not a lot of countries consuming a lot of Chinese movies or music, but what they do really admire about China is the way that it builds. China has chosen to use infrastructure as a way of bolstering its soft power. It uses it to create friendly relationships with other countries, and offer them infrastructural projects that they never could have afforded to build on their own.
Will Doig: The other way that it uses infrastructure to project power is really in a more literal sense. One of the criticisms of One Belt, One Road is that China is partnering with much poorer countries to build huge megaprojects in those countries. They’re not doing it with grants. Often they’re loaning those countries Chinese money to build the projects with the expectation that those countries will ultimately pay that money back to China. The criticism of this of course is that it puts those smaller poorer countries in a position where they can’t pay back the money and then find themselves indebted to China in a way that makes them more beholden to China’s wishes.
Will Doig: So, when I say that One Belt, One Road is inseparable from Chinese foreign policy, that’s really what I’m talking about is a sort of dynamic wherein China creates a relationship with a poorer country, puts that country in a financial position that’s somewhat untenable and then that forces that poorer country to support China’s geostrategic aims.
Jeff Schechtman: Why are these poorer countries, and Laos is certainly a good example because it’s really the first place that this railroad that you spent time talking about is going into. Why are these countries so willing to go along?
Will Doig: For a couple of reasons, and some of them are very legitimate reasons. For a country like Laos, this is what China is offering, which is a modern state-of-the-art railway running all the way through the country. This is a once in a lifetime opportunity for a country like Laos. They could never build something like this on their own. You have to remember that Laos is the only country in Southeast Asia that’s completely landlocked. They have no access to the sea, which is part of the reason why they’ve lagged so far behind their neighbors in terms of development. There’s been a lot of talk about the railway turning Laos from a landlocked to a land-linked country. This would give Laos more access to Thailand below. It would give access to markets farther down the Southeast Asian peninsula, and that could be a good thing for Laos.
Will Doig: Then, there are other reasons that they might be going forward with the project that are maybe less scrupulous, and one of those reasons is corruption. I mean, Laos is an incredibly corrupt country. A few years ago, it made the top 10 list of the international corruption rankings. I think now, it’s clawed its way all the way up into the 30s but it’s still a place where the way deals get done with the government are often unsavory. There’s no smoking gun of course, but the general consensus among people who study these projects is that the way the railway deal got done with China was not entirely aboveboard.
Will Doig: You have to remember that this is China’s railway. I mean, China wants it more than anybody including the countries that it’s actually running through. If China wants to get it done, they will get it done. If they’ll deal with the country like Laos in a way that might not always be completely aboveboard, then that’s the way that they will get it done.
Jeff Schechtman: Why is China so anxious to get this done? Is it for the geopolitical influence? Is it for the economic impact, or is it that they see something down the road in terms of the potential need for this 10, 20, 40 years from now?
Will Doig: I think the answer is really all of the above. I mean, China has a lot of different goals with this project and those goals vary depending on the country that it’s running through. For instance, when you take a country like Myanmar, if China was to build a country to Myanmar’s West Coast, that would essentially give China access to the Indian Ocean. People talked about China turning Myanmar into its own California. Seaports, that’s a big reason. Other reasons are to get access to markets in these other countries or maybe get access to resources, that they could use the railway to then pull back into China.
Will Doig: One of the reasons is that they actually just want to develop the area along the railway. It’s interesting, we think of Southeast Asia as such a sort of booming dynamic region and it is, but what we forget is that these are still very rural countries. Most of them only have one big city and then those cities are separated by these huge expanses of completely undeveloped land or mostly undeveloped land in between them. China would like to urbanize a lot of those areas as it builds the railway because urbanization is what China does. They build cities. They love real estate development. When you build a city, you create a new market, and maybe that market could then buy Chinese goods.
Will Doig: So, I think that there’s a lot of different objectives both for this particular project and for One Belt, One Road in general. It’s why the Chinese government often talks about One Belt, One Road in such vague terms because you can’t really put a pin on exactly what they’re trying to do with it, but I think that it achieves an array of objectives for them. Maybe the most basic is that I think projects like this have become sort of calling cards for China’s unstoppability. I mean, if China does … This is like a too big to fail project for China. They want to make sure that this comes off because they know the world is watching and they have presented themselves as the new global developer for the 21st century, and this is an early test case for that.
Jeff Schechtman: Given how much overbuilding and over development has taken place in China recently, how do they look at this in that context?
Will Doig: It’s a good point. I mean, China really has sort of overbuilt at home. It’s part of what has propelled their economy so successfully over the last many years, but what it’s really… it’s done to them, is given them more airports, more condominiums, more factories, more of a lot of things than they actually need there. So, they’re a little bit overbuilt at home and one of the reasons that’s been stated for the One Belt, One Road initiative is to basically give China other countries in which to pour its concrete. I mean, these projects are usually built by Chinese companies using Chinese labor and Chinese technology.
Will Doig: So, when you think about the scope of these projects, how big they are, how many countries they’re occurring in, how many people are needed to build them, all the technology involved, it adds up to just a huge economic stimulus. With that economic stimulus flowing directly back into Chinese companies, that is sort of what China is counting on to keep its economy humming along.
Will Doig: Now, this has been one of the big criticisms of the project too because a lot of people feel that China should be using local labor, or local technology, or local companies. China would come back to that and say, “That’s a nice idea but in a country like Laos, where are we going to find that labor?” I mean for instance, Laos is a country where a large portion of the population works as subsistence farmers. It basically means they wake up, they grow their own food, they eat it, and they go to bed. These aren’t people who are used to working on timetables, and schedules, and punching cards, and showing up to work at 9:00 AM.
Will Doig: Another reason is that this is a very highly technical project. You might need 500 electricians to build this railway. There aren’t 500 electricians in Laos. China would say, “Those are the reasons,” although I think at base, the major reason that they like to do it themselves is to funnel as much of the profits back to Chinese companies as possible.
Jeff Schechtman: How much of it is also as part of their foreign policy a projection of wanting to project the success of their form of kind of authoritarian capitalism?
Will Doig: That’s an interesting question. I mean, people often are surprised that China has not trended more democratic as its markets have opened up. That’s sort of the concept that we have here in the west which is as you liberalize economically, you will democratize politically. China hasn’t really done that. I mean clearly, it’s going in sort of the other direction over the last few years. I’m not sure why we always assume that’s the way it will happen because in a lot of ways, the authoritarian political system and the liberal economic system have worked really well in tandem for China.
Will Doig: I mean, if you can really sync up those two systems, it gets them running parallel, then you have an economy that can grow in a way that for instance the United States economy could never grow, because we have a political system that often works against the economy for various reasons, for political interests. So, I think that China has found that this has worked for them so far and they’re going to keep going with it. The Chinese people seem to be tolerating it, I think because the economy is growing so quickly and it is a very proud nationalistic culture that sees this is working for them and would like to support it.
Jeff Schechtman: Of course in a pluralistic democratic system, it takes 45 years to build the 17-mile subway.
Will Doig: That’s true and sometimes we wished that we had China’s way of doing things at least a little bit more just so that we could get to the Upper East Side without having to walk four long blocks in the winter.
Jeff Schechtman: Talk a little bit about the countries that you visited that are part of this high speed rail that’s part of One Belt, One Road, and whether or not this has gone too far. Whether this project is, you say too big to fail, but maybe even too big for China to see it through?
Will Doig: I think that the way it will happen is that parts of it will work and parts of it won’t. So, we talk about it as it’s one continuous rail line from China’s southern border all the way to Singapore, and that’s certainly the way that China would like us to see it because it sounds good. I think what will really happen is that this will evolve piecemeal in different countries down the line and that maybe it never will entirely connect. Maybe there will not be a one seat ride all the way from Kunming to Singapore, which nobody really wants anyway. There’s no reason to take a train all the way from China to Singapore.
Will Doig: If they can sort of build out parts of the network, that would have its own benefit. I mean for instance, one of the parts of the network is a high speed train that is being built between Kuala Lumpur in Malaysia to Singapore. Now technically, this isn’t even being planned by China. China is just bidding for the contract to build this project that’s already been planned entirely between the governments of Malaysia and Singapore, and yet China sees this as part of the project anyway because they feel that if this railway becomes a reality, it could benefit them in some way.
Will Doig: It’s interesting to see how different countries are sort of using their own leverage to get what they can from China while not absorbing too much Chinese influence. I think for a country like Laos, they really don’t have much leverage at all other than their geography, which is China wants a way south. If you talk about a country like Malaysia, they have more influence and can sort of push back harder. Depending on which country you’re talking about, I think China’s chances of success are very different.
Jeff Schechtman: Is there a timeline to any of this, or is it kind of open-ended?
Will Doig: There’s really no specific timelines for the entire project. I think that China wants to finish it quickly for sure. I think the only part of this particular project that is really happening on the ground right now is the part that’s in Laos, and China probably does have timelines out there for it. I’m not sure exactly what they are. They’re probably pretty quick. They’ve done a lot of work in the last year. If you look at the construction that’s going on up by the Chinese border, they’re tunneling through mountains. They’re starting to lay track.
Will Doig: I think that they would like to make it happen quickly, but I also think that China thinks in centuries. I mean, this is a country that really is playing the long game in a way that a lot of other countries don’t. So, when they talk about One Belt, One Road, they’re talking about a project that’s scope will go on for decades. It will go on, in China’s mind, long after we’re all gone. I think that that is the reason why they create projects like this that seems so kind of surreally large to us.
Will Doig: I mean for instance, when you talk about China’s ghost cities, a lot of people have sort of noted that China builds these huge cities but they don’t actually have any people in them. Well, we forget that China does things differently than we do. They are building these cities from scratch and then expecting them to fill up on kind of 20 or 30-year timelines. So, they don’t mind losing some money and losing some time on the front end. I think as long as there’s the expectation that eventually these projects will come to benefit a future China, because they see themselves as the next world superpower and they are.
Will Doig: And they kind of are setting the stage right now for that to happen. They’re not too worried about making it all happen tomorrow, surpassing the US immediately. I think they’re biding their time. They know that it’s going to happen, and they’re okay with giving it time to unfold.
Jeff Schechtman: How much of this though is totally dependent on the economy going forward in one direction? How much does it take into account the realities of recessional worse in the global framework?
Will Doig: I think that’s the question on everybody’s mind. There are maybe ways that China is confronting that question internally that we don’t hear about, but I think it’s definitely… the One Belt, One Road backlash is in full swing. I mean, if you read the headlines about the projects lately, I think a few weeks ago the Washington Post had a headline that was something like China’s one trillion dollar mistake or something like that. So, it’s become quite popular to think, “Oh, could this entire thing collapse if China’s economy doesn’t keep moving along?”
Will Doig: I suppose that’s possible, but again you have to remember that this isn’t one cohesive plan. I mean, this is really more of a notion. China wants the world to gradually absorb Chinese development more and more, but there’s no blueprint that has a bunch of rail lines and highways leading out from China and timetable thing. “Well, this one will be built this year, and this one will be done by this year.” It’s more of just China’s feeling about how it exists in the 21st century, and how it will project itself.
Will Doig: As far as their economy going up or down, I think they’re not too worried about that. The projects can always sort of be put on pause. Many of them have been put on pause for various reasons. They can be started up again later. As long as there’s no real timetables or benchmarks, then it gives them a lot of room to say, “No, thanks. We’re still on track.”
Jeff Schechtman: Talk about how good they are at doing this, and how their skills and talents to do it have evolved in terms of the real estate, the development, the building, all the aspects of this.
Will Doig: I think that they’re actually doing pretty well. I think they’re doing better than they get credit for a lot of the time. I mean, it’s… criticizing China is very popularly in the west, and I think sometimes part of it has to do with our own insecurity about the fact that they are sort of growing to match us economically. Really, it’s easy to forget that China just got into the international development game like 10 years ago. They’re really new at this and considering that they’re so new, I think that they have been learning pretty quickly. The United States has been doing this for decades, and I’m sure that we had a learning curve when we first started.
Will Doig: When they learn, I think that what they’re learning is learning how to get the job done, and if that means changing the way that they do things, then they will do that. So for instance, China gets criticized a lot for not respecting human rights when they build some of these projects, or not respecting the environment. They’re starting to change the way that they confront those issues a little bit, not because they suddenly care about human rights or care about the environment, but because the countries that they’re working in do and are demanding that China say, “Okay, if we displace this community of people for our railway, then we will build them another village somewhere else, or if we drain this lake to build this project, then we will mitigate the environmental impact of that somehow.”
Will Doig: I think that they’re starting to do that more and more, and this is what’s interesting about China working outside of their own borders rather than in China. China has built its own high speed rail way incredibly quickly. It literally built the largest high speed system in the entire world in the space of 10 years, but the reason they were able to do that at home was because they can do whatever they want at home. Now, they’re working in other countries and those other countries have demands, and I think that China is learning that, to make this project work, they’re going to have to cede to those demands to some degree.
Will Doig: Now of course, they can also negotiate ways some of those demands with some of those governments and that is happening in certain instances, but it’s been interesting to see them kind of evolve their thinking and their tactics as they have sort of gone out into the world and really met the world face to face.
Jeff Schechtman: Of course, the more they do, I mean the more they’re creating — you touched on this before — creating whole new markets for themselves.
Will Doig: Yeah. That’s to me is one of the most interesting things about a project like the railway running through Southeast Asia. China definitely sees Southeast Asia as one of its primary markets to sell to. It’s right in its own backyard. It’s a fast-growing region. It’s a young region. It’s a region with a rising middle class. But again, I mean you take a country like Thailand. Thailand basically is one big city, Bangkok, and everybody moves there.
Will Doig: So, it’s a kind of overwhelmed city, and I think that China would hope to urbanize more of Thailand because when you urbanize an area, you turn farmers into city dwellers, and city dwellers consume more than farmers. Who do they consume from? Well, probably China. I wouldn’t say it’s a primary objective of One Belt, One Road because it’s sort of theoretical and it’s probably not going to make a big enough impact to really be a game changer, but I do think that by creating new markets and creating new urban areas, you change the entire economic dynamic of a region. That change, the change to that dynamic benefits China directly.
Jeff Schechtman: Talk a little bit about the management of all of this from Beijing. Given that this is just one part of so much Chinese engagement all over the world.
Will Doig: Well, it’s funny that you say the management from Beijing because I don’t think that One Belt, One Road is as centralized as a lot of people see it to be. So, definitely the kind of overall directive comes from Beijing. Beijing has put this idea in place and they said, “This is how we’re going to build. This is how we’re going to sort of develop the world,” but a lot of the One Belt, One Road projects are sort of managed on a more regional level. In China, their provinces have a lot of autonomy, and local leaders in those provinces have a lot of autonomy.
Will Doig: China almost kind of manages those local leaders in a way that you might imagine that like a corporation where they can compete and rise up through the ranks of the Communist Party. So, if a provincial leader in Yunnan Province is in charge of a particular One Belt, One Road project, he wants to execute it really well so that he’ll get noticed and maybe he’ll be “promoted”. So, it’s not as central as everybody thinks, and I think that’s part of the decentralization.
Will Doig: It’s why some of these One Belt, One Road projects are so surreal, because when you have decentralization, sometimes the coordination isn’t there. So, you’ll have for instance two parallel railroad tracks running right beside each other going to the same place, and it’s because you know maybe two different leaders were both trying to build the same project in some way. That’s all kind of… China understands that, and those kind of odd accidents are baked into the budget.
Will Doig: Yeah, I think really, China is a huge country and that decentralization I think is almost necessary because with a project of this size, it would be really hard for the entire thing to be managed from Beijing. I think that Beijing knows that, and they’re okay with giving up some control to more local authorities.
Jeff Schechtman: It’s also part of what seems like the unending political expansion of China in terms of its efforts in Africa, its efforts in South America, all over the world essentially.
Will Doig: Yeah. I mean a lot of these projects, they’re emanating from China physically. Like this railroad in Southeast Asia certainly connects directly to China, but a lot of One Belt, One Road projects are nowhere near China and don’t actually have a direct link, physical link to China at the moment. So, yeah as you mentioned, I mean China’s been doing a lot of development in Africa. Africa is a continent where China has long standing roots actually.
Will Doig: Chairman Mao built a railway for Tanzania back in the mid-20th century, and he built it back when China was a third world country just like Tanzania. He sort of did it as a diplomatic effort. He even framed it when he presided over the groundbreaking of the railway, and he said something like “You’re a poor country and so are we, but we are willing to forego railway building for ourselves so that we can build this railway for you instead.”
Will Doig: That was a time when China really had very few friends in the world and that was even back then, its way of reaching out to other countries. So to some degree, it’s okay with China if not all these projects physically link up with China, because again it’s not really about actual transportation a lot of the time. If China is building a railway in Kenya, that could be a diplomatic effort, or it could be a way of trapping Kenya in some sort of debt where it has to support China on a political goal.
Will Doig: I’m not saying that the Kenya railway is either one of those specifically, but I think that it’s a mistake to think of all these projects as having to actually funnel people, or goods, or energy back to China. That’s not necessarily the case. Sometimes they really are kind of free floating projects that China is scattering out into the world with different long-term goals.
Jeff Schechtman: Finally, how prepared is China to handle pushback from some of these countries even with respect to the Southeast Asia project?
Will Doig: I think that they’re handling it. I mean, some of these countries, even though they are much smaller and less powerful than China, have been very good at pushing back. So if you take Thailand, I mean Thailand basically had been giving China the runaround on this railway ever since it was first conceived. Thailand at the moment is run by this military government that’s been in power since 2014. Honestly, Thailand doesn’t really need this railway. The project doesn’t make a whole lot of sense for Thailand when you think about it, but at the same time, the Thai government doesn’t just want to say to China “take a hike”. So, instead what they’re doing is kind of stalling for time and signing agreements and memorandum of understanding and saying, “Oh yeah, we’re going to do this project,” and they have a ceremonial groundbreaking and then nothing happens.
Will Doig: So, that’s one way of pushing back and I think it’s pretty rare where you see a smaller, less powerful country than China really explicitly push back and say no like, “Get out of our backyard.” There’s a lot more kind of tactful diplomatic maneuvering. Again, I think that it’s easy to assume that China is forcing these projects on a lot of these countries but that’s often not the case. I mean, many of these countries are very excited for all these Chinese investment.
Will Doig: They’ve never had a country that’s this interested in investing in them before. They want to take advantage of it, while at the same time sort of mitigating Chinese influence, but they still want that Chinese cash or that Chinese technical expertise. So, when you think about all these countries trying to strike that balance, yes on one hand, they fear China and they fear this kind of heavy hand reaching into their country and a bunch of people coming in and kicking up a lot of dust. At the same time, they are really looking forward to having say a high speed rail system which they wouldn’t have built on their own. So, I think the relationships are a lot more complex and overall a decent job of navigating them with many, many exceptions.
Jeff Schechtman: Will Doig, his book is High-Speed Empire: Chinese Expansion and the Future of Southeast Asia just out from Columbia Global Reports. Will, I thank you so much for spending time with us here on Radio WhoWhatWhy.
Will Doig: Thank you for having me.
Jeff Schechtman: Thank you, and thank you for listening and for joining us here on Radio WhoWhatWhy. I hope you join us next week for another Radio WhoWhatWhy Podcast. I’m Jeff Schechtman. If you like this podcast, please feel free to share and help others find it by rating and reviewing it on iTunes. You can also support this podcast and all the work we do by going to whowhatwhy.org/donate.
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