China's Xi Defends Belt and Road, Vows ‘Zero Tolerance’ of Graft
Xi unveiled the plan to rebuild ancient trading routes across Eurasia in 2013, calling it the “project of the century.”
(Bloomberg) -- Chinese President Xi Jinping pledged to clean up his signature Belt and Road infrastructure program amid criticism the policy is indebting poorer nations and making them dependent on Beijing.
“We need to maintain that all cooperation is conducted under the sun and work together to combat corruption with zero tolerance,” Xi said in an address to the annual Belt and Road Forum for International Cooperation in Beijing on Friday.
He vowed that China would negotiate and sign high-standard free trade agreements with more countries, strengthen cooperation in customs, taxation, auditing and supervision, and establish a cooperation mechanism for jointly building the Belt and Road tax collection and management system.
“We need to pursue high-standard cooperation,” he said. “We will adopt widely-accepted rules and standards, and encourage participating companies to follow general international rules and standards in product development, operations procurement, tendering and bidding.”
Some 5,000 attendees from across the globe were in the audience for Xi’s address. Chinese officials have pledged this week to improve funding arrangements for projects along the Belt and Road network.
Xi unveiled the plan to rebuild ancient trading routes across Eurasia in 2013, calling it the “project of the century.” China has since poured billions into investments from Africa to the South Pacific, with the president championing it as a means to spur development, goodwill and economic integration.
At least seven countries who agreed to Belt and Road projects have suspended, scaled back or terminated them, or experienced backlash for their involvement. Earlier this month, China struck a deal with Malaysia to resume the East Coast Rail Link project for 44 billion ringgit ($10.7 billion) -- down from 65.5 billion ringgit -- after the Southeast Asian nation terminated it in January.
“The implementation is always what’s really difficult,” Hannah Ryder, chief executive of officer of the Beijing-based consulting firm Development Reimagined, told Bloomberg Television.
“For the governments here for the Belt and Road Forum, of course, these are probably great words, really good to hear,” she said. But Chinese officials will “really have to still invest time, still push in order for these things to happen.”
More Control
To address some of the concerns, Beijing is taking a range of steps to exert more control over the program, officials and participants said. They include a more muted publicity drive, clearer rules for state-owned enterprises, restricted use of the Belt and Road brand, and building overseas auditing and anti-corruption mechanisms.
The People’s Bank of China would “build an open, market-oriented financing and investment system,” Governor Yi Gang said in remarks Thursday. The government also released its analysis framework for debt sustainability.
Xi pledged new development with the Philippines in a Thursday meeting with President Rodrigo Duterte, including building an industrial park north of Manila and providing resources for regional growth, presidential spokesman Salvador Panelo said.
In March, a senior official from China’s top economic planning body, the National Development and Reform Commission, said China wanted to combine its manufacturing and construction know-how with the advanced technology of Western firms on the global trade-and-infrastructure program.
--With assistance from Andreo Calonzo.
To contact Bloomberg News staff for this story: Dandan Li in Beijing at dli395@bloomberg.net
To contact the editors responsible for this story: Brendan Scott at bscott66@bloomberg.net, Karen Leigh, Daniel Ten Kate
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