China has made very significant strides in economic development since it began to open up and implement economic reforms in 1978.
Since then, it has started recording a quantum leap in GDP growth rate annually and was able to lift a whopping eight hundred million of its population from poverty.
By dint of hard work and grim determination, the country has now moved to a higher middle income status, now more assertive on the global stage than before and is on the verge of becoming a world superpower.
The dominant vehicle of Chinese global influence has been through belt and road initiatives. The belt and road initiative is a Chinese foreign policy initiative that was conceived under the aegis of president Xi Jinping in 2013 to promote global economic integration with China as well as promoting global infrastructural development.
The belt and road initiative was designed based on the historic silk road approach that was introduced under the Han dynasty in China thousands of years ago and which was a network of trade routes connecting China to the Mediterranean regions. For this reason, the belt and road initiative has been nicknamed as “the new silk road”.
Under the initiative, China seeks to promote economic interconnectivity through two major means – by sea and by land and this has led to the construction of roads, bridges, ports, railroads etc.. in the participating countries of the belt and road initiative.
The belt and road initiative serves as a nerve centre of Chinese foreign policy strategy, hence was integrated into their constitution in 2017 and it is theoretically anticipated to be fully completed in 2049 which coincides with the hundred years anniversary of the founding of People’s Republic of China, whereby it is expected that China will become a fully fledged developed country by then, which is well placed to project its power and influence across the whole world.
The belt and road initiative consists of different components, such as: (i) infrastructural development which includes the construction of hydro dams, thermal plants, roads, railways, ports etc. (ii) social and cultural exchange which involves the promotion of people – to – people bond through granting of belt and road scholarships and other forms of engagement that makes exchange possible etc.. (iii) financial and economic integration which includes the creation of industrial parks, exemption of import duties along the Silk Road etc.
However, it is important to emphasize that the infrastructural development receives better attention than all the other components of the belt and road initiative.
China’s rapid economic growth, increasing influence in global affairs and recognition has made her fall into a Thucydides trap (a situation of conflict which arises between an emerging power and an existing power as a result of the former threatening to displace the latter from its enviable position) with the United States as the world’s hegemon.
Given the pace of China’s economic growth, it is projected that its economy will topple that of the United States within the next ten years and of course, enjoy the benefits that go with it.
This situation has brought about a seeming rivalry between the two biggest economies in the world, whereby the United States seems to be on a spree of mobilizing her allies to oppose China’s rising influence in global affairs.
However, China is of a firm belief that, its prosperity is linked to the prosperity of her neighbours. Since there is no country in the world that is able to attain autarchy (complete self-reliance), there will be a need for countries to work together in order to complement each other’s needs and this has necessitated the introduction of belt and road initiative by China as a tool of promoting international cooperation and as an avenue for sharing its economic prosperity with other countries of the world in a win-win situation in order to ensure a shared future of prosperity together.
However, the belt and road initiative was misconstrued by some groups of people who are subtly led by the United States and her allies, for obvious reasons.
They vehemently opposed the initiative and proposed alternatives such as the blue dot network, which is spearheaded by the United States, Japan and Australia.
Build Back Better World (B3W) was recently proposed by G7 countries to counter China’s belt and road initiative on grounds that, the BRI is disproportionate, unfair and benefits China much more than the participating countries and most importantly as a geopolitical tool of China to exert its rising influence in global politics and domination.
The belt and road initiative was estimated to cost China a whopping four to eight trillion dollars ($4 to $8 trillion), and it is touted as the biggest infrastructural development initiative in human history and it is anticipated to positively impact a greater percentage of the world’s population.
As of December 2021, one hundred and forty-two countries have subscribed to the initiative by signing a memorandum of understanding with China.
Aside from the propaganda, hue and cry against the belt and road initiative, one big question stands tall – is it beneficial to the interest of Ghana or it is a mere Trojan horse? (a clever and deceitful plan to benefit China at the expense of other countries).
After a careful analysis of the situation based on cogent reasons, one can only come into agreement that it has benefited Ghana tremendously and even stands to benefit the country more. The following cogent reasons were adduced to corroborate the above claim.
Since joining the initiative in 2018, one major area that the initiative has helped Ghana so much is the area of debt sustainability. Ghana is a developing country that already has a problem with the debt to GDP ratio. Already Ghana’s debt to GDP ratio is 83.54%.
The country is seriously wallowing under a heavy debt crisis and has to spend a huge sum of its hard-earned revenue in paying exorbitant interest on loans that it has contracted in the past. Under this current condition, it is not wise to contract further loans in order to aggravate its debt to GDP ratio or attract high interest on its contracted loans and that is exactly where China’s belt and road initiative has come to the rescue.
Under the belt and road initiative, a bilateral agreement was signed between the government of Ghana and China, whereby China will finance a whopping $2 billion worth of infrastructural projects such as the building of railways, roads, and bridges.
In exchange, Ghana will mortgage only 5% of its bauxite deposit to China. This can be considered as a smart way of borrowing in order to avoid neck-breaking interest rates on loans, thus ensuring a win-win situation for both countries.
One other major benefit derived from the initiative by the country is in the area of job creation. The initiative has helped the country so much in terms of job creation. Through award of numerous infrastructural contracts for roads, bridges etc.., many local artisans such as carpenters, masons, steel benders, architects etc.. got employed.
One major criticism levelled against the initiative by its opponents is that the contracts are awarded to only Chinese companies, thus, it benefitted only the Chinese. This criticism is not tenable, because, that notwithstanding, greater number of locals in the participating countries got employed by the Chinese companies that execute the contracts, thus benefitting all.
The BRI is a major stimulant of Ghana’s development than being a Trojan horse because, it has facilitated technological, social, cultural etc… exchange between the two countries. Each year, a number of Ghanaian students are given opportunities under belt and road scholarship to study the various undergraduate and postgraduate courses in order to train the needed human resource for the development of the country.
Before the 1978 reforms that pave way for a massive transformation of China into its current glory, it used to be a developing country just like Ghana and others. China’s rapid economic miracle is worth emulating by developing countries like Ghana and this has been made possible through the belt and road scholarship which made it possible for transfer of developmental experience from China to other developing countries through exchange of students, who are prospective future leaders.
The BRI has also benefitted Ghana tremendously in the area of trade and economic integration. China is the second-biggest economy in the world and has the largest population of about 1.5 billion people and that translates into a huge prospect for trade among her partners.
Trade and economic integration constitute an integral component of BRI and this has led to creation of industrial parks, exemption of import duties along the silk road for the participating countries of BRI to take advantage of, including Ghana.
There has been a surge in bilateral trade between the two countries right after Ghana has joined the initiative in 2018. For example, in 2019, Ghana has exported $2.05 billion worth of commodities to China.
It is however important to emphasize a point that, much as China does not attach strings to loans that it offers under the initiative to impose their will on countries like what other lending countries and international organizations do, bilateral agreements under the initiative are considered purely as business deals that stem from the free will of the participating countries for their mutual benefit and must be respected as such.
It, therefore, behoves on individual state actors making deals for their respective countries under the initiative to be responsible and guided by a sense of accountability and should not allow their personal interest override that of the state in making deals with other countries.
This is because the business agreement is a business agreement, nothing more, nothing less!. This is very necessary because every country considers its national interest supreme in relation to other countries. For example, when Sri Lanka could not pay for the construction of the Hambatota port, it was taken away from them to be managed by China for ninety-nine years. China is not father Christmas hence, business agreements made with her must be respected as such to avoid any undesirable consequences.
Author: John Koku Dzegbau
Beijing Normal University.