Chinese BRI Summits: Analysis of Latin American and European participation

Chinese BRI summits: Analysis of Latin American and European participation

ANALYSIS

18 | 01 | 2023

Texto

Nation attendance to the international meetings on the Belt and Road Initiative gives an idea of the engagement with the projects and the political stance toward China—and the US

En la imagen

A Belt and Road Initiative Forum taking place in China in 2017 [BRI]

The Chinese Belt and Road Initiative (BRI), sometimes referred as the 21st century New Silk Road, is one of the “most ambitious” infrastructure projects ever conceived: The vast collection of development and investment initiatives would stretch from East Asia to Europe, significantly expanding China’s economic and political influence. The variety of projects are discussed in the BRI summits, which are a series of conferences in which business leaders, diplomats, advisors, lobbyists, and other high-level representatives share a common platform that facilitates international cooperation for development in the regions involved in the initiative. The main objective of such summits is to create a network among the attending nations of trust, mutual understanding, and economic cooperation. The summit is held every year in Hong Kong ever since the first summit took place in 2016. The seventh edition, being the latest, was concluded on September 1st, 2022.

It is relevant to distinguish the summits (that constitute the main object of our study) from the Belt and Road Forums for International Cooperation. While the latter aims to provide an occasion for the discussion of political and economic views, the summits focus on the actual development of the BRI projects in terms of infrastructure, investment, and all other aspects in a more practical and real manner.

The Initiative was created by China’s Xi Jinping in 2013 and, ever since, Chinese interests in the Indo-Pacific region have only gained increased importance in the geopolitical agenda of the East Asian nation. Moreover, the BRI functions for China as a mechanism to engage with the international community without projecting an intrusive image on the internal affairs of other states. With the increasing political and economic relevance of China, it is only natural to see it engaging in different regions of the world. Ultimately, the BRI has the aim to connect China with the rest of the world—mainly Eurasia—so that the country has a stronger presence compared to the other global powers.

Despite the international importance of the Belt and Road, there is no easy way to access specific details about the summits. Documents on the issue are predominantly written in Chinese, and the data which is available in other languages is mostly incomplete. As an example, the attendee lists are only available for the 2022 and 2021 summits; before that, there is no information on any Chinese official website.

This paper contributes to fill the very gap mentioned above. Because of this, we believe that this paper plays a part in reducing the transparency associated with the BRI summits. When discussing the attendance of member countries with respect to different regions it is possible to distinguish a specific geographic pattern and observe the importance—or lack thereof—of the project in different areas. This information can also throw more light on the current geopolitical situation concerning the BRI. Moreover, the participation of different global powers demonstrates their position towards China and its increasing international influence.

For this analysis to be possible, this paper will be divided into three different sections, where specific regions will be addressed in a chronological manner, with respect to the participation of nations in the summits. First, the paper will discuss Latin America, followed by Europe. Next, the paper will state the major findings of the analysis. Throughout the analysis the focus will be set on the attendance of high-level government officials of the different delegations, such as heads of state, government, and ministers.

Latin America and Europe were chosen as the subjects of study because of the strategic and economic importance they hold for China. On the one hand, Latin America is one of the biggest markets for raw materials and natural resources which are vital to maintaining Chinese manufacturing. Latin America is also an important hub for maritime commerce which can be exploited by China through the Maritime Belt and Road (it refers to the Indo- Pacific sea routes, part of the Belt and Road Initiative, that comprise from Southeast Asia all over to South Asia, Africa and the Middle East.) Europe is, as well, the target of our paper because it is an area where China can potentially exert economic influence, which in turn can bring it politically closer to China and distance it from the North Atlantic Alliance.

Latin American presence at the BRI summits

The Chinese economic interests have intensified in Latin America with the expansion of the Belt and Road Initiative over the years. Despite this, the region has demonstrated a lax response to greater Chinese participation in its economies. This can be attributed to the economic influence of the United States in the region. Moreover, the historical political influence of the US in Latin America represents an important factor that should be taken into consideration. Traditionally, the region has not challenged the United States’ dominance and the BRI is no exception. Yet there is a possibility for a slow but steady inclination of different Latin American countries that have been hedging between the two global powers.

The first BRI summit, held in 2016, is difficult to analyze since there are no official numbers stating the amount of attendees who were present. There is no possible way to find this information through official sources since the Chinese government does not provide the numerical and qualitative data neither in their official websites nor in the official reports of the summits. The same phenomenon occurs for the next four summits, yet there are some secondary sources that shed light on the attendance of some top-level officials of the region.

While for the second summit (2017) there is no official attendance list, The Diplomat published an article in which all nations who were represented by a head of state or a minister were mentioned. In the case of Latin America, only Chile and Argentina were present at both the summit and the forum with Michelle Bachelet and Mauricio Macri respectively. Brazil also attended the second edition of the BRI summit, yet it is not specified at what level of government they were involved.

The case for the third summit (2018) is the same as the one for the 2016 edition. For this year’s edition there is also no official information available, yet the official BRI report mentions the presence of around 100 delegations without specifying their nature. What it is known is that 80% of the attendees were service providers, investors, and project owners. The fourth edition of the summit (2019) saw almost nonexistent Latin American involvement. The only confirmed head of state that was present at the summit came from Chile, while there were no other regional delegations involved.

The fifth summit (2020) was in a very different format because of the outbreak of the Coronavirus. This year’s summit was held online, which is the possible cause for the official attendee list to be missing. The official reports mention that around 80 delegations attended the summit and only 22% of the participants were government officials. While the attendance was numerous, there were no in situ meetings with any Chinese official or company because of the heavy impact of the pandemic worldwide.

On the other hand, the sixth summit (2021) saw the participation of five countries (Barbados, Brazil, Chile, Mexico, and Uruguay) so it can be clearly seen that the involvement fell from 2021 to 2022. The seventh and latest summit (2022) saw the participation of only four Latin American countries (Barbados, Brazil, Chile, and Venezuela).

There are no evident reasons for the dismal participation rate of the Latin American countries. Among the main regional powers of Latin America, only two (Brazil and Chile) attended the seventh edition (2022) of the Belt and Road summit hosted in Hong Kong. Moreover, nations such as Panama, Peru, and Nicaragua, where there is great potential for Chinese development of infrastructure owing to their strategic location and abundant resources, were absent from the summit.

This lack of Latin American response comes as a surprise when one looks at the enormous financing and investment that China has been infusing in the region. The volume of public loans to some Latin American governments was enormous. Since 2010 China has given credits through its main policy banks of a total amount of 119.8 billion USD, which as of 2021 represents almost 2.2% of the total GDP of the region. During the first years of the BRI, such capital was given through the China Development Bank and the China Export-Import Bank, yet nowadays China now tends to promote investment thought its commercial banks, helping the penetration of Chinese companies in the Latin American private sector by acquiring local companies.

It is evident that despite the political interest of the Asian giant, investment has dramatically decreased since 2018. This year saw China pouring in a total investment of around 10 billion USD in the development of infrastructure in the region. Compared to 2021, it was reduced to almost a quarter of what had been three years before. Previous summits were no different: in 2017, only four Latin American countries sent a government official to represent their states before the BRI, as already revealed. This lack of participation got accentuated during the next few years. Because of the lack of information provided by official sources of the Chinese government, it is not possible to discuss the 2020-2021 period, yet if we follow the existing pattern, we could presume that attendance at the BRI summit did not importantly increase during the lockdown years.

What is certain is that both government officials and private enterprises are welcome to attend the summits. Nevertheless, if a nation is willing to send an official representative or head of government it is primarily because of a greater interest between the Chinese-led Belt and Road Initiative and the attending state. Barbados and Panama have never sent a government official to the summit, for instance. On the other hand, Brazil’s Bolsonaro has demonstrated personal interest to participate in the meetings.

While there might be political interests in the BRI, investment is a vital factor that can define whether the region is devoted to China’s advances or not. To this day, economic investment coming from China into the region has seen uneven distribution. While the causes of this phenomenon are different in nature, the effect of direct investment and construction in Latin America coincides with the level of involvement of such regions in the Initiative.

The existing investment in the area has also been affected differently throughout its geography. Only Argentina, Chile, Ecuador, and to a much lesser extent, Guyana have been highly impacted by the investment of the BRI. The rest of the area has not seen a great amount—if any—of these incentives provided by Chinese initiatives. Nations such as Peru, Mexico, Bolivia, and Uruguay have been almost invisible to the projects. This is demonstrated by their lack of participation in most BRI summits.

Such investment—or lack thereof—creates an uneven allocation of BRI resources in the region, which could create an unbalanced distribution of Chinese economic influence between different nations. This perceived imbalance would be filled by other investments coming from different regional or international actors, such as the European Union or, more importantly, the US. Therefore, Latin America does not only represent an opportunity for a new market of natural resources and manufactures, but also a possible foothold for the expansion of Chinese political influence in the region. States such as Bolivia, Venezuela, and Nicaragua are prone to be interested in such non-Western initiatives for economic development.

On the other hand, it is known that Chinese foreign policy has made efforts to attract the Latin American market since it is seen as more reliable than the African one. This is evident when comparing the Rule of Law Index of Latin America and Africa. In Africa, the Index is predominantly lower: Countries such as Ethiopia, Egypt, and Algeria have a score of 0.39, 0.35, and 0.49 respectively, while Argentina’s score is 0.55, Chile’s 0.66, and Uruguay’s 0.71.

Because of this, China has made consistent efforts in getting closer ties with Latin American countries. For example, in 2018, Xi Jinping visited President Varela in Panama. Yet a group of Latin American nations have remained reluctant to be involved in such a direct manner with Chinese geopolitics. Historically, Latin America has had a great interaction with the United States, therefore it is necessary to maintain formal neutrality in relation to China. Only a few cases such as Cuba and Venezuela would lean towards greater economic participation with China (apart from trade), while the rest of the region has chosen a more cautious approach.

European presence at the BRI summits

The BRI has been rapidly evolving in its scope to encompass a huge part of the globe from North Africa to the Indo-Pacific. Following the natural expansion to the West that the Belt and Road Initiative intended to create, BRI development and financing have already reached Eastern Europe and the Balkans. The European position on the BRI has been overwhelmingly responsive.

In terms of European participation, the first edition of the BRI summit (2016) saw none (because of the lack of official data, the paper sustains this affirmation in all the data gathered from newspapers and other reliable sources). This non-existent response does not necessarily involve negative connotations, but rather the early ignorance by Europe of the growing Chinese quest. The Belt and Road Initiative in its initial years focused more on establishing the regional roots that would allow the future expansion of the project.

In a more in-depth discussion of the official figures of European presence in the yearly BRI summits, the attendee lists provide us with interesting information. We can see a persistent growing tendency in the quantitative sense, but this is not strictly connected to the quality of the involvement. The second summit (2017) was the one to which more countries (France, Greece, Switzerland, Finland, Spain, the United Kingdom, and the Czech Republic, among others) sent representatives for the first time, generally in the category of government officials. This peak can be attributed to a significant increase in the Chinese engagement in non-BRI countries in terms of investment, and the consequential need for the receiving European countries to express a grateful response to some extent, or at least an interest in the Chinese initiative.

For the third edition of the summit (2018), the situation cannot be accurately analyzed as no official sources have published an attendee list. Moving forward to the fourth summit (2019), a significant decrease in the number of European representatives can be perceived. The only countries attending for the first time were Austria, Belgium, Italy, and Portugal. On the other hand, Finland, Spain, and the United Kingdom did not send any representation in 2019, even though the Coronavirus pandemic was not until the following year and have participated in the following summits. For all those countries that did attend, government officials were sent in representation.

The fifth BRI summit (2020) does not have any official attendance lists. This may be due to the fact that the Covid pandemic took place and the Belt and Road Initiative summit happened in a dual form: physically and via online (which enabled a more numerous participation, but that did not leave any officially published figures from the Chinese government).

It is in the sixth summit (2021)—of which we have official data from the BRI Reports—when we can start to distinguish the shift to the private sector. Almost all countries decided to not send any government officials but only private entities. Austria, Cyprus, Finland, and Ukraine did not attend the summit. Separately, Belgium, Bulgaria and Ireland participated for the first time in the congress. The list for the seventh and last summit (2022) grows to a number of twenty-three European attendees and is practically identical to the one for the 2021 summit with very little change: Austria did participate and Estonia attended for the first time. Countries like Poland, Portugal, Romania, Russia, Spain, and the United Kingdom preferred to be both represented by government officials and private entities, with a domination of private enterprises for the rest of the nations.

Despite the peak in 2017, European engagement has progressively weakened. Even though the number of countries represented has grown to a figure of twenty-three (2022 BRI summit), the number of attending government officials has plummeted, translating into a private entity dominated initiative. This data states a clear decline of the compromise that Europe is willing to show, at least officially, regarding the Belt and Road summit and the overall Chinese politics.

This tendency is mostly representative of Central and Western Europe: France, Belgium, Ireland, Italy, Greece, and Switzerland are now only sending private entities to be involved in the BRI; while Russia, for instance, is sending both private enterprises and government officials to the yearly summits, demonstrating a clear compromise with the Chinese project—thus aligning their economic attitude with the political approach of both countries. On the other hand, and in attention of the current Russo-Ukraine war, it is relevant to perceive the lack of involvement by Ukraine, who only attended the 2017 edition (in contrast to its now opponent in war who has only increased their involvement since the start of the Chinese initiative).

Even though the European Union has historically been aligned with the western hemisphere, this has not eliminated the possibility for Chinese investment to pour in, especially in Eastern Europe and the Balkans. The attendance in the BRI summits decreased during the Coronavirus pandemic, yet the interest in the initiative has magnified since the beginning of the initiative. In 2017, sixteen delegations attended whilst, in 2019, approximately 10 delegations sent top-level government officials or heads of state. These numbers demonstrate that there is common ground for European and Chinese interests.

Europe has enabled itself to engage with Chinese projects, probably because of the modern image that the BRI presents to the world. Despite the affirmation that China and Europe may find real common interests, the attendance figures prove that this alignment occurs in the private sector (economy, certain social projects like the ones described in the following paragraph, and so on) rather than in the public and political spheres.

For instance, the Belt and Road Initiative claims to be an environmentally responsible project that aims to promote green finance development and the infrastructural shift to natural resources and energies. These objectives fit perfectly with the current energy crisis that is impacting Europe. Both politically and economically, Europe is looking for alternatives that can alleviate the weight that Russian fuels have on the EU.

Along with the possibilities that green energy and financing create for Europe, certain newly incorporated projects should be distinguished: those for the promotion of young business leadership and women entrepreneurship that entered the BRI plans in the years 2017 and 2018, respectively. The similitude with the West’s pursuit of women’s rights and the encouragement of young entrepreneurship provides one more reason for the gradual incorporation of more and more European countries into the Chinese Belt and Road Initiative network.

Knowing that EU and Chinese interests overlap, it comes as no surprise that many different European leaders have assisted one summit at least once. Moreover, it would be naive to ignore the Chinese approach, knowing that Recep Erdogan and Vladimir Putin have strategic objectives in negotiating in the Belt and Road, given the fact that their respective nations are corridors to Europe. The EU’s position towards China is critical for its geopolitics since they need to balance the influence of Russia and Turkey over the BRI, yet without giving in to Chinese economic influence that could risk the political coercion of the European Union. This divergence in the stances regarding the Chinese initiative can also cause a progressive separation as each country pursues its long-term objectives, which may align more or less with the project of the EU.

It is only natural that the European common market will be cautious of the increasing Chinese presence in the region (and thus their lack of official governmental participation in the BRI summits). As far as the presence of an investment of this magnitude relegates the internal economic development to a delicate position, European companies will find themselves in an ambiguous situation of balance between both cooperation and competition with Chinese enterprises, which have been gaining influence outside of the Asian continent for a long time now. Furthermore, discussions may arise in the political field due to the difference in the responses of the individual members of the European Union. Countries such as Austria, Spain, and the United Kingdom (who do send government officials as well as private entities to the summits) find themselves far more implicated in the BRI than others like Italy or France (who rely solely on private representation).

Conclusion

Overall, apart from the specific regional challenges that the BRI faces in different continents, it is unmistakable that the Initiative has become a relevant topic of various foreign agendas. The Belt and Road Initiative has propelled Chinese influence abroad and has clearly solidified the position of China in the global arena. In Latin America, as well as in Europe, the BRI is welcomed with specific limitations, due to economic and political constraints that characterize the way regional politics are handled.

In the case of Latin America, it was noted that states were reluctant to act mainly because of the political influence of the United States in the region. The US perceives the growing participation of China into the Latin American economies as a threat to its sphere of security. On the other hand, Latin American countries are still not completely absorbed into the Initiative, being put off because of the effect that the Covid-19 pandemic has had on Chinese and Latin American societies. Even though investment has reached the region, it is clearly uneven if we compare to other regions, and this might instigate the lack of participation in the summits since there are no factual results revealed from the Chinese involvement yet.

Lastly, Europe has seen more active participation, mainly from member states of the EU. Participation in the BRI in Europe is seen as more of a primordial objective for the international agendas of EU member states. There is still increasing competition between Russia, Turkey, and Western Europe. Since the investment of the BRI in Europe has impacted the most in Eastern Europe and the Balkans, nations such as Greece, Serbia, and Bulgaria are more participative in the summits compared to France, Ireland, Italy, or the Nordic countries. It is expected that Europe will remain one of the points of attention for the BRI investment while it is geographically closer to China, and it represents a more promising market for Chinese green finance and energy.