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Remarks by Ambassador Lu Shaye at the Belt and Road Initiative (BRI) Conference
(2018/12/15)

(December 14, 2018, Ottawa)

Dr. Benoit-Antoine Bacon, President and Vice-Chancellor of Carleton University,

Excellencies,

Ladies and gentlemen,

Friends,

Good morning!

This year marks the 5th anniversary of the Belt and Road Initiative (BRI). Over the past five years, the influence of the BRI has been growing  fast with greater participation from all sides and fruitful results. More than 140 countries and international organizations have signed Belt and Road cooperation documents with China. The BRI and its core concepts have been incorporated into outcome documents of major international institutions, such as the United Nations, the G20, and the APEC,etc.

The BRI is not only highly welcomed by Asian and European countries along the Belt and Road route, but also by many African and Latin American countries which are also eager to join it. Although some western countries held a unfavorable view towards the BRI at first,  with the BRI continuing to bear fruits, they began to realize the opportunities brought to them by the initiative and their attitudes turned from scruple or scepticism to active participation. For instance, the British government says its country is a natural partner of the BRI. The French Senate Foreign Affairs, Defense and Armed Forces Committee issued an assessment report on the BRI, suggesting that France should take part in the initiative in a more active way. Japan has already established in collaboration with China a public-private council related to the BRI to facilitate enterprises from both countries to engage in t hird-party market cooperation.

Indeed, there are some different voices on the BRI in the international community. Some say it is a tool for China to seek geopolitical interests, thereby expanding its global influence, challenging the western-dominated international system and upsetting the US supremacy, while others say that some major BRI projects are white-elephant projects causing massive debt burden on the host countries, and China capitalizes on this debt trap to grab the resources, infrastructures and even sovereignty of those countries. These allegations have caused misrepresentation on the BRI worldwide. The reason for holding  this conference today, is to provide a platform on which stakeholders, experts and scholars can discuss and debate on the BRI. Through information sharing, viewpoints exchanging, and even contest of different ideas, I hope this conference help the public better understand a true BRI. After all, truth does not fear contention. I’ll get the ball rolling with my humble opinions.

First, the BRI is not a geopolitical tool, but an international public goods provided by China to promote global economic balance, sustainable development and common prosperity for all countries. After the financial crisis in 2008, we have witnessed the sluggish recovery of the world economy and slow growth in trade for quite a long time. While  globalization is developing, anti-globalization, populism and protectionism are on the rise as well. The wealth gaps among and within countries are widening and disparity of development is exacerbated, thus resulting in aggravated social injustice and turmoil in some regions and countries. In order to deal with these problems from the root causes, development issues are in the first place to be addressed. New driving force is necessitated to boost global economic development, new approach is required for international cooperation and integration, meanwhile China itself is also facing the task of economic transformation and upgrading. In this backdrop of times, the BRI was proposed with the aim to advance economic policy coordination among countries, and promote orderly and free flow of economic factors, highly efficient allocation of resources as well as deep integration of markets, so as to jointly create an open, inclusive and balanced regional economic cooperation architecture that benefits all, and uphold the global free trade system and the open world economy.

  In the past five years, the BRI has achieved fruitful outcomes, and has become a widely welcomed international public goods. The trade volume of goods between China and countries joining the BRI has reached more than 6 trillion US dollars. China’s direct foreign investment to those countries has exceeded 80 billion US dollars. Under the BRI framework, China and 43 countries have jointly built 82 economic and trade cooperation zones, attracting nearly 3,500 enterprises, creating 244,000 local jobs, and contributing 2.2 billion USD of taxes to the host countries. For example, in Africa, China helped build the Mombasa–Nairobi Standard Gauge Railway in Kenya, and this project created nearly 50,000 local jobs, boosting Kenya’s GDP by 1.5 percent. In Sri Lanka, the Puttalam coal-fired plant built by China is now providing over 40 percent of the country’s electricity, benefiting more than 20 million people. According to a McKinsey & Company report, after surveying over 1,000 Chinese companies in eight African countries in 2017, they found that on average 89% of the Chinese company employees were Africans. The China-Pakistan Economic Corridor and China-Belarus Industrial Park have also boosted the local economy. Later in this conference, diplomatic envoys of Russia, Pakistan and Belarus will share with us the stories of their countries’ participation in the BRI.

 The BRI is proposed by China, but its fruits are shared by participating countries and the whole world. It’s not a tool to seek geopolitical interests, nor does China want to compete with anyone or supplant anyone. BRI is a cooperation platform for all countries to achieve common development.  The increase of China's international influence is the result of implementation of the BRI rather than the purpose of putting forward this initiative.

Second, adherence to the principle of extensive consultation, joint contribution and shared benefits is the key to the success of the BRI, which fully demonstrates China’s concept of equal cooperation with other countries. Extensive consultation means that we pool collective wisdom and carry out relevant initiatives through negotiations, with the interests and needs of all sides being fully taken into account. From drawing blueprints to project execution, we stay committed to equality, openness and transparency, instead of imposing our wills on others or excluding any country. Joint contribution means that all sides apply their expertise and give full play to their strength and potential. Shared benefits means to benefit all the people of countries joining the BRI in a more equal and fairer manner, and build a community of shared interests and destiny. The BRI infrastructure projects serves the interests of all, because they not only bring tangible welfare to the local people, but also ameliorate the investment environment of relevant countries and benefit foreign investors including those from the West. The Aid Data team at the College of William & Mary recently issued a working paper that analyzed satellite images of the global distribution of night lights and found that Chinas infrastructure projects have brought more lights to the places where theyre built, thus lighting up the development prospect of the region. It also said that Chinas infrastructure projects in developing countries, especially in Africa, have greatly boosted local economic growth. 

 The so-called “debt traps” brought by the BRI are utterly groundless. Nowadays in the world, quite a few developed countries face serious debt problems. For instance, the national debt of the US has exceeded its GDP, standing at 21.52 trillion US dollars . Anyone hypes that the US is falling into debt traps. But no sooner do some developing countries borrow from China for construction than debt traps are sensationalized. What’s more, the loans China provides to relevant countries only account for a small proportion of their foreign debts. According to the Philippine government, the loans provided by China is only 0.65 percent of the country’s total foreign debt. According to statistics from Sri Lanka’s Central Bank, Chinese loans is only 10 percent of its foreign debts in 2017, of which 61.5 percent is preferential loans at interest rates below that of international market. From 2000 to 2016, China’s loans only accounted for 1.8 percent of Africa’s foreign debts. In fact, rather than debt traps, many developing countries are faced with poverty traps due to historic and external reasons. But through cooperation with China and by learning from China’s experience in poverty alleviation, many developing countries are rising from poverty traps. Among China's partners, no country is beset with a debt crisis because of the cooperation with China.

Third, Canada can also benefit from the BRI cooperation. The vast Pacific Ocean separates our two countries geographically. In terms of cooperation for infrastructure and facility connectivity, there seems to be little we could do, not to mention the fact that Canada, as a developed country, is already well established in its infrastructure. However, China and Canada could carry out cooperation on other aspects, such as policy coordination, trade facilitation, finance flow and people-to-people exchange, which are integral parts of the BRI’s “five connectivities”. Although achieving a China-Canada Free Trade Agreement faces new obstacles due to reasons known to all, the two sides can strengthen policy coordination and adopt trade and investment facilitation measures under the framework of the BRI, reduce trade barriers and interference from non-trade factors, so as to strive to achieve the goal of doubling trade volume by 2025 on a 2015 basis. China has great market potential and there are limitless business opportunities in the Asia-Pacific region. Currently, the Canadian government has been actively engaged in promoting trade diversification and increasing its share of the Asia-Pacific market. I believe that the BRI presents important opportunities for Canada to reach this goal.

It is also of great significance for China and Canada to strengthen people-to-people bonds by promoting exchanges so as to enhance mutual understanding and trust of the two peoples.

Even in infrastructure building area, there is room for cooperation. China and Canada could  engage in third-party market cooperation, create a kind of synergy and achieve triple-win by combining the needs of developing countries, China’s production capacity, and Canada’s advantages in capital and technology. Canada is one of the members of the Asian Infrastructure Investment Bank (AIIB), which provides favourable conditions for the country to participate in the Belt and Road facility connection.

My words intend to start further discussion. I look forward to hearing your wisdom and insights at the conference, and I hope that the conference will contribute to the better understanding of the BRI among Canadian people.

Thank you!