By Zhao Minghao Source: Global Times Published: 2017-5-14
The US, UK, Australia and other Western countries have all sent senior officials to the ongoing Belt and Road Forum for International Cooperation. As economic globalization now faces strong headwind, the Belt and Road initiative is getting wide attention from the international community. Aside from an impetus in infrastructure development, global trade and cross-border investment, it also opens new opportunities for US-China cooperation.
In the beginning of April, Chinese President Xi Jinping and US President Donald Trump met for the first time at Mar-a-Lago, where the largest and second largest economies in the world agreed to establish "comprehensive economic dialogue" for more balanced trading relations and a "win-win" solution instead of "zero-sum game."
The US has every reason to be a stakeholder in the initiative. During the Clinton administration in the 1990s, the US government kicked off a Silk Road initiative in an attempt to help Central Asian and the South Caucasus countries strengthen ties with the global economic system, especially Europe.
In July 2011, then secretary of state Hillary Clinton officially unveiled the New Silk Road initiative. The hope was that it would facilitate economic integration between Central Asian and South Asian countries and instill economic impetus into solving the Afghanistan issue.
This New Silk Road initiative focused on four key areas, namely developing regional energy market, facilitating trade and transportation, upgrading custom and border control, encouraging business and personnel exchange, all issues similar to the Belt and Road initiative proposed by China. Cross-border power cooperation was one major project under the New Silk Road initiative - CASA-1000 transmitted surplus power in Central Asian countries southward to Afghanistan and Pakistan. Another major energy project was the natural gas transmission pipeline connecting Turkmenistan, Afghanistan, Pakistan and India.
As Ariella Viehe, research fellow at Center for American Progress, said, if the Belt and Road initiative and the New Silk Road initiative are complementary rather than competitive, then there is a big chance of their success.
American think tanks have kept intensifying research on the Belt and Road initiative over the past years. Christopher Johnson, senior research fellow at Center for Strategic and International Studies, calls upon the US to not exaggerate the geopolitical impact of the Belt and Road initiative and take it seriously.
American companies such as GE and heavy machinery maker Caterpillar have shown strong interest in joining the Belt and Road initiative. GE has already sealed cooperation agreements with several Chinese companies on building power stations in Pakistan together.
It will also jointly start more financing programs under the Silk Road Fund, a China-backed financial institution, covering fields like the power grid, new energy, natural gas and oil development.
The Trump administration clearly shows a stronger interest in infrastructure development than its predecessor. James Woolsey, former CIA director and now senior adviser to Trump, once wrote an article saying that the Obama administration`s opposition to the formation of the Asian Infrastructure Investment Bank "was a strategic mistake," and he expected Trump to give a "much warmer" response to the Belt and Road Initiative.
Asian Development Bank (ADB) estimates that Asia needs to invest approximately $8 trillion in overall national infrastructure between 2010 and 2020. The authorized capital of AIIB is $100 billion. Since it commenced operation in January 2016, AIIB has granted over $2 billion in loans for 13 projects, most of which are joint financing projects with World Bank, ADB, European Bank for Reconstruction and Development and so on.
AIIB President Jin Liqun stressed on several occasions that US companies will not be excluded from AIIB business. Canada, an important ally of the US, applied to join AIIB last year.
Though Trump takes an "America First" policy approach, the US should not shy away from its obligations toward global growth. Joining the Belt and Road initiative will deliver benefits to American companies and help increase job opportunities within the country.
More importantly, US-China cooperation within the framework of the initiative will forge closer bilateral economic ties. This is a good thing for the world.
The author is a visiting fellow of the Chongyang Institute for Financial Studies at Renmin University of China.