Economic Watch: Belt and Road forges new path to inclusive globalization

by Xinhua writers Zheng Xin, Hu Wenjia

BEIJING, April 22 (Xinhua) -- Six years into its development, the Belt and Road Initiative (BRI) is more celebrated as a resounding call for advancing and rebalancing globalization, forging a new pathway toward inclusive globalization that delivers widely-shared benefits.

Observers of the cross-continental common cause see the 2nd Belt and Road Forum for International Cooperation (BRF), which is set to open Thursday under the theme of "Belt and Road Cooperation, Shaping a Brighter Shared Future", as a key event for gathering fresh momentum for economic globalization.

The BRI will help support globalization in a period when the impulse for international trade is not so strong, said John Ross, a British academic and senior fellow with the Chongyang Institute for Financial Studies at Renmin University.

"The International Monetary Fund and other international organizations are projecting a significant slowdown in Western economies this year and next," he told Xinhua in an interview. "Reduced economic growth almost invariably creates a negative effect for trade and foreign investment. Under those circumstances, the BRI is particularly significant."

Most economies in the world including the EU, most developing countries, Japan and China are seeking to strengthen globalization, and a large number of these states will be at the second BRF making it an internationally important event, he said.

Noting that the BRI is different from many preceding global initiatives, Ross said it is offering stronger support for globalization to combine tariff, legal and material economic benefits.

"From World War II onwards trade liberalization under the old General Agreement on Tariffs and Trade culminated in the creation of the World Trade Organization. But these efforts focused on tariffs and legal aspects of globalization such as international standards while failing to deal with creating the material economic underpinnings of globalization such as infrastructure," he said.

"This is what both the Asian Infrastructure Investment Bank and the BRI seek to do," he said.

The BRI, proposed by China in 2013, aims at building a trade and infrastructure network connecting Asia with Europe and Africa along the ancient Silk Road trade routes to seek common development and prosperity, as China joins other countries in seeking balance between efficiency and equity in economic globalization to ensure that different countries, different social strata and different groups of people all share in the benefits.

Critics of neoliberalism-centered globalization, the dominant form of globalization, warn that overdoing economic rationality as a mere cost-benefit calculation for profit maximization means enormous benefits for a tiny minority and marginalization and damage to a large part of the world's population.

Shi Zhiqin, executive director of the Institute of the Belt and Road Initiative at Tsinghua University, said economic globalization, while being an unstoppable trend, needs adjustment and rebalancing as it enriches a minority at the cost of the interests of the majority and stokes polarization.

"The BRI is a new model of globalization that highlights balanced and inclusive development," he said, "It is also a new form of multilateralism and a supplement to the APEC and G20."

It is different for its principle of extensive consultation, joint contribution and shared benefits, which is being embraced by more and more countries and translated into concrete dividends of globalization, he said.

"As globalization faces real uncertainties, the multilateral platform underscores cooperation and mutual trust in tackling common challenges," he said.

Loletta Chow, Global Leader of the EY China Overseas Investment Network and EY B&R Taskforce Leader, said the initiative had become a promising platform for both developed and developing economies to achieve win-win cooperation.

In promoting policy, infrastructure, trade, financial and people-to-people connectivity, the BRI is boosting the global flow of cargo, capital, technology, production capacity and talent, she said. "It has injected new impetus into globalization."