context: Ministry of Foreign Affairs has pushed back against the criticism of falling BRI (Belt and Road Initiative) investment in the foreign English-language press. While policy banks’ and high-level government investment may be slowing, business activity at the level of firms is moving forward.

Wang Yi 王毅 minister of Foreign Affairs started the year with trips to African and ASEAN countries. He highlighted both BRI and vaccine diplomacy on his trips. Highlights are

  • Africa trip
    • visited
      • Nigeria
      • Congo (DRC)
      • Botswana
      • Tanzania
      • Seychelles
    • Wang highlighted BRI MoU’s signed with DRC and Botswana and discussed future Africa–China relations, pointing out China will
      • continue to help develop Africa’s transport, energy, and communications infrastructure
      • support the construction of free trade zones in Africa and develop large related markets in both China and Africa
      • promote investment to help industrialise Africa
      • strengthen cooperation in scitech innovation, particularly digital economy and green development
  • Southeast Asia trip
    • visited
      • Myanmar
      • Indonesia
      • Brunei
      • the Philippines
    • from January 11 to 16, and reached broad consensus with other countries on uniting and cooperating in response to the epidemic and promoting the quality and upgrading of China–ASEAN relations
    • discussions highlighted
      • the countries have purchased or received China’s COVID-19 vaccine
      • new BRI projects were signed
      • China and Indonesia discussed further opening the Chinese market to Indonesian exports and China building 5G and cloud computing infrastructure in Indonesia

Imports and exports to BRI countries grew by 1 percent in 2020, according to GAC (General Administration of Customs) data. In addition, non-financial direct investment increased by of 24.9 percent. A recent report on BRI risks by China Chengxin RAEX-Europe Rating and VIS Group noted

  • East Asian countries face lowest risk
  • South Asia and Central Asia are most at risk due to COVID-19 and a global recession impacting debt repayment
  • in general developed nations also face less risk while high-risk countries include
    • Kyrgyzstan
    • Pakistan
    • Ukraine
    • Iran

The focus of BRI has expanded from infrastructure and M&As to include trade, climate change cooperation, and poverty alleviation, notes Wang Dan 王丹 Hang Seng Bank chief economist. Due to increased investment scrutiny in Europe and the United States, Chinese investment activity will pivot from developed to developing countries, and mergers and acquisitions by Chinese companies in developed countries will be similarly reduced.