BRI and Muslim World
Complex and complicated changing socio-economic partnerships, emerging banking & financial parameters, reinventing geopolitical equations and last but not the least, redefined geostrategic compulsions have once again “reaffirmed” Chinese holistic policies of common/shared prosperity, conflict resolution, community development, greater regional connectivity, immense socio-economic integration, equal rights and resources of economic growth and, above all, global development initiative.
In this context, China has been striving hard to achieve a “multipolar” world in which power politics may not be used for unilateral sanctions against any country.
However, smoking guns of dirty power politics around the globe has now opened a new window of enhanced cooperation between China and Muslim world in which China’s One Belt and One Road Initiative may play an important role.
While attending and delivering a keynote speech in the 48th OIC session in Islamabad Chinese State Councilor and Foreign Minister Wang Yi stressed the need to have a greater political understanding and economic cooperation between China and Muslim countries.
China’s support for occupied Kashmir and Palestine has actually won the hearts and minds of Muslim countries. He proposed a complete road map for further strengthening of bilateral relations between sides starting from “mutual respect” to immense “monetary cooperation”.
In this context, Chinese Foreign Minister Wang showcased that China has already invested over $400 billion in nearly 600 projects across the Muslim world under the Belt and Road Initiative (BRI).
Inclusion of Syria into BRI is a “paradigm shift” in the Mediterranean region. Iraq’s membership to BRI has “strategic failure” for the US and its allies that have been plundering its natural resources and even busy looting its ancient treasures for so many years.
According to the latest report (December 2021), Chinese BRI engagement has further increased its investment in Asia during 2020-2021. Asian countries continued to receive the largest share of Chinese BRI investment of about 35 percent in 2021.
Moreover, African and Middle Eastern countries picked up an increasingly large share of Chinese engagement, up from 8 percent in 2020 to about 38 percent of BRI engagement in 2021.
Particularly Arab and Middle Eastern countries increased investment by about 360 percent and construction engagement by 116 percent compared to 2020.
Furthermore, China’s financing and investment spread across 46 BRI countries, with 26 countries receiving investment and 37 with construction engagement.
The country with the highest construction volume was Iraq, with about US$10.5 billion, followed by Serbia US$6.8 billion and Indonesia US$2.4 billion. Tanzania, Egypt, the Russian Federation and Singapore also received substantial funds during the same period.
Chinese contractors and investors were engaged across most sectors in 2021. The focus of BRI continued to be in infrastructure, particularly energy and transport.
In 2021, particularly the health sector experienced a significant growth of engagement of 246 percent from about US$130 million to US$450 million.
As promised by Chinese President Xi, no coal projects received financing or investment in 2021. Green energy finance and investment in the BRI increased to a new high in 2021 at US$6.3 billion compared to US$ 6.2 billion in 2020.
Chinese Foreign Minister Wang pledged that the Chinese holistic policy of multilateralism would be a benchmark for sustainable partnership with Islamic countries which would be based on “solidarity”, “development”, “security” and “civilization”.
The Chinese Foreign Minister pledged that China will provide 300 million doses of COVID-19 vaccine to Islamic countries in helping them fight the pandemic.
He rightly urged that both sides should join hands to build the BRI and implement the Global Development Initiative (GDI) in high quality so as to contribute to realizing the UN Sustainable Development Goals (SDGs) by 2030.
For 2022 I expect that Chinese BRI engagement will accelerate with a focus on transport in Asia, resources and other strategic assets including new seaports. There would be better opportunities in investing in smaller projects that are faster to implement e.g., solar, wind projects all the member countries of BRI.
I forecast that during 2022 an acceleration of green projects would also due to the “Guidelines for Greening Overseas Investment and Cooperation” issued in July 2020, and the “Guidelines for Ecological Environmental Protection of Foreign Investment Cooperation and Construction Projects” issued in January 2022, both issued by the Ministry of Commerce (MOFCOM) and the Ministry of Ecology and Environment (MEE).
From the earliest days, China’s interaction with the Muslim world/countries were based not only on trade, but on religious and cultural connections. In 2013, Chinese President Xi Jinping proposed building a land-based “Silk Road Economic Belt,” extending from China to Central and South Asia, the Middle East and Europe, and a sea-based “21st Century Maritime Silk Road,” connecting China to Southeast Asia, the Middle East, Africa and Europe via major sea lanes rattled many regional as well as global capitals and centers of power. Thus BRI has further strengthened Chinese ties with Muslim countries.
BRI is now a truly global endeavor: 39 countries in sub-Saharan Africa have joined the initiative as well as 34 in Europe and Central Asia, 25 in East Asia and the Pacific, 18 in Latin America and the Caribbean, 17 in the Middle East and North Africa, and six in South Asia.
These 139 members of BRI, including China, account for 40 percent of global GDP. Sixty-three percent of the world’s population lives within the borders of BRI countries.
While China emphasizes the benefits of BRI for developing countries, Beijing has enlisted countries of all income levels to endorse the initiative. 26six low income countries and 39 lower middle income countries have joined the initiative, accounting for just under half of all the participants.
By contrast, 41 upper middle income countries, as well as 33 high income countries, have signed on, accounting for over half of the BRI participants.
BRI members include U.S. allies and partners such as Greece, Italy, Saudi Arabia and the United Arab Emirates as well as countries that align with China geopolitically such as Cambodia and Laos.
Interestingly, many of the world’s most powerful and economically dynamic countries have vetted BRI, and therefore they can embrace BRI projects. In the coming years, Beijing is likely to continue to lobby countries to sign on to the initiative, focusing its attention on Latin America and Western Europe, where regional heavyweights such as Argentina, Brazil, France, Germany and Spain remain outside of BRI.
To conclude, being a non-Muslim majority country, China has a longer, deeper and more influential history of cultural interaction with Islam than any other large country or major culture in the world. The western China consists of countries with a great variety of Islamic economies.
I foresee that China has certain unique advantages to engage with Islamic economies and utilise Islamic banking and finance. Modern Islamic economics of Pakistan, Kazakhstan, Iran, Indonesia, UAE, Qatar, Saudi Arabia and Malaysia hold promise for BRI development strategies in countries with Muslim majorities.
The linkage between the BRI and Sharia-compliant financing is that China will require vast investment to fund its grand ambitions to construct a network of land and maritime economic corridors through the Middle East, Africa and Europe. Much of that could come from funds raised through Islamic financing tools.
