Mutually Assured Construction: How Competition from China’s Belt and Road Initiative Could Benefit

Originally Published in the December 2019 Journal, Breaking the Silence, Pg. 23

A Belt and Road international forum. Source: WikiMedia Commons

China’s Belt and Road Initiative (BRI) is an unprecedented undertaking. With the financial backing of a trillion U.S. dollars and an established presence in over a hundred countries, the BRI represents the apex of China’s diplomatic and economic statecraft. Naturally, China benefits from its patronage of developing countries. New ports, roads, and railways serve a political and strategic purpose. And while China has been eager to present its efforts as a commitment to regional cooperation, powerful skeptics remain. The United States is particularly wary of the BRI’s aims. But global tensions like these could be serendipitous; insights from arms race models hold the key. Succinctly put, competition between these two economic titans could—in a best-case scenario—be harnessed for a more optimal goal: environmental protection. If China were to utilize the BRI to spearhead an eco-friendly agenda (with greater investments in renewables, research and development, etc.), competition would yield net benefits for society.

But is a green BRI even feasible? Arguably, yes. Although massive infrastructure projects can negatively impact ecosystems, the BRI could mitigate potential harms. Formal policies like environmental impact assessments (EIAs) and strategic environmental assessments (SEAs) are noteworthy; they integrate economic planning with environmental monitoring. These mechanisms have been increasingly adopted throughout newer projects as part of a wider effort to address the BRI’s effects. Additionally, China has over the past decade promulgated a series of surprisingly robust regulations on sustainable development. New laws, standards, and recommendations signal a strong commitment to environmental protection. Altogether, this is an encouraging trend. While there may be shortcomings in the standards of China’s environmental safeguards, there is a basis for improvement to occur. A green BRI may indeed be a feasible reality.

By building off of traditional arms race models, we can use several insights to construct a new framework and explore a slightly similar idea: an economic arms race. Crucially, this would not involve the competition for superiority in arms. It would instead focus on the struggle for dominance in investments, capital, and market influence. Let us assume that states like China and the U.S. will always pursue ends that produce the most self-benefit. In a way, this is not an unrealistic assumption. After all, Chinese investments in foreign countries and businesses are not entirely altruistic: national interests are at stake. These investments are all part of an international competition for influence, market access, and even military presence. If China manages to outspend its rivals, it will gain all of these things and more. It will benefit immensely—to the detriment of competitors like the U.S. Consequently, China’s BRI generates outsized economic and security concerns for other countries: it is a direct challenge to their utility.

The BRI, with its massive reach and financial backing, represents an escalation in an economic competition. In a traditional arms race, it is argued that reciprocation of strategies is the most optimal decision. For instance, if your opponent actively expanded their arsenal, you would do best to follow suit. Staying complacent would mean falling behind, since an armed state could easily overpower an unarmed one. This logic holds true for our framework of an economic arms race. Rival states are compelled to match China’s level of investment in order to counter the expansion of their influence. It would not be ideal to be cornered out of a market. Again, this is not an unrealistic premise. In 2017, the US announced its commitment to the Free and Open Indo-Pacific Strategy (FOIP). Essentially, the US had created an American-backed investment platform, a direct counterweight to China’s BRI.

Assuming also that international relations are characterized by a lack of information, states would only have knowledge of foreign motives based on policies adopted. Reputation is thus incredibly important. With no central authority to enforce a decision, reputation allows states to make credible actions or even threats. Given that the BRI could become a green, global initiative, a Chinese commitment to sustainability (bolstered by a decade’s worth of legislation) would signal an eco-friendly agenda. Rival states—already engaged in a struggle to maintain utility and dominance—would interpret the green BRI as a new challenge to counter. In this manner, a commitment to eco-friendliness would work to China’s benefit: it would develop a valuable, positive reputation as a green power. But moreover, rival states will be incentivized to match China’s green development strategy with green policies and investments of their own. Should they ignore an escalation on this front, they risk losing potential ground to China. And multiple states pursuing a green platform under an economic arms race would provide enormous benefits for the environment. Competition over the BRI could lead to rather positive outcomes.

To reiterate, it is possible that this is all just a best-case scenario—a hypothetical at most. After all, there is no guarantee that countries like China or the US would want to commit to eco-friendly initiatives in the first place, even when presented with the option to do so. But the reciprocation of strategies is highly likely. The existence of the FOIP suggests that America has not disregarded the BRI’s influence. With Chinese and US investments flowing into underfunded areas, crucial economic developments can occur. And if China were to hone its efforts on making the BRI a truly green initiative, it is likely that rival states would be compelled (to some degree) to reciprocate and match these policies. A state of mutual distrust could lead to mutual benefit: protection of the environment.

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