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China is striking deals to cement its role as Asia's trade hub

The Straits Times

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September 25, 2024

China has made several moves in recent months to advance its ambitious aim to become the trade and transportation hub of Asia.

To its west, China has agreed to build a rail line across Central Asia. Beijing also said it would help Vietnam plan three rail lines leading to the countries' shared border. And China is trying to persuade Russia and North Korea to let it reopen a long-closed port on the Sea of Japan.

If successful, the plans would give China closer ties to the economies of North-east and South-east Asia, the Middle East and even the Arctic, the latest steps in its 11-year-old Belt and Road Initiative to create a more China-centred global order.

Each of the efforts, in varying ways, faces obstacles.

The nation's top leader, Mr Xi Jinping, will need close cooperation from border countries, some of which are politically volatile, like Kyrgyzstan, or internationally isolated, like North Korea. Neighbouring countries that have long been wary of China, such as Vietnam, will need to be reassured.

A similar venture, a three-year-old rail line that China has forged into landlocked Laos in South-east Asia, has been welcomed by some there for bringing an influx of Chinese mining investments and tourism to the country. But others have warned of Chinese domination of the Laotian economy.

“They ended up owning a lot of the land, or at least using a lot of the land, and squeezing out some of the locals,” said Assistant Professor Chong Ja Ian at the National University of Singapore.

The new initiatives would also be expensive, and China has begun emphasising smaller Belt and Road projects elsewhere.

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