Washington/Beijing: While a conference with the African nations has been scheduled to start in the Chinese capital, the opposition to the ambitious project, One Belt One Road (OBOR), planned by President Xi Jinping, is once again on the edge. The international media and study groups have aggressively highlighted the opposition to the OBOR and the debt trap associated with it, leading to China having to struggle to garner support for the project. In view of this, Myanmar, China’s neighbouring country has renegotiated part of the billion-dollar OBOR project and has forced China to reduce its investment.
Chinese President, Xi Jinping had announced the OBOR project in 2013. This project was seen as the symbol of the increasing Chinese ambition to dominate the world. The project envisaging an investment of more than a Trillion dollars, and participation from more than 50 countries was considered to be a decisive turn in establishing the Chinese dominance over the world.
But there are clear indications that after five years, the future of the ambitious project initiated by the Chinese President is under threat. The media, leaders and study groups in the United States, Europe and Asia have raised serious questions regarding the stance behind the Chinese ambition and implementation. As per the report published by ‘Centre for Global Development’, a study group in the United States, eight of the countries, who are part of the OBOR project have expressed inability to service the ‘debt trap’ investment.
These include Pakistan, Maldives, Laos, Djibouti, Mongolia, Tajikistan, Kirgizstan and Montenegro. The railway projects started under the OBOR in a country like Laos are valued at more than USD 6.5 billion. This amount is equivalent to 50% of the GDP of Laos. The proportion of debt in Djibouti has reached 85% of the GDP within two years of starting the project.
The negative tones against the Chinese investment under OBOR are already intensifying in the main participant country, Pakistan. A US daily had claimed that the rate of return on the Chinese investment in a power project in Pakistan is going to be a whopping 34%. The newly elected government, which assumed power last month itself, may find the matters related to the China-Pakistan Economic Corridor, a project under OBOR, tricky to handle.
At the same time, the jolts received to the OBOR from Myanmar, Thailand and Malaysia could prove to be new challenges faced by the ruling government in China. Malaysian Prime Minister delivered a severe blow to China, cancelling projects worth $20 billion. Subsequently, Thailand has inserted new clauses for the OBOR projects.
Myanmar has started renegotiations regarding the port project to reduce its scope and indicated accepting an investment of only $1 billion as against the project worth $7 billion. The Hambantota port in India’s neighbour Sri Lanka underlines the dark side of the ambitious Chinese OBOR project. As per the agreement, China has acquired the port and the adjoining 15,000 hectares of land for 99 years, against a loan of $1 billion.