Pakistan's Gwadar port shows China's Belt and Road can fail

Deutsche Weil ^ | 13th May 2024 | Kira Schacht

[Cronos]

Pakistan's Gwadar port was meant to be a shining success for China's Belt and Road Initiative. But almost two decades later, it still sits empty.

'Investors thought Gwadar would become Dubai' The idea behind the CPEC was to connect China's western Xinjiang province with the sea via Pakistan. This would shorten trade routes for China and help avoid the contentious Malacca Strait choke point, a narrow waterway between Malaysia and Sumatra that links the Indian and Pacific Oceans. Pakistan, meanwhile, would benefit from increases in trade, infrastructure and industry along the 2,000-kilometer corridor (1,240 miles), all financed by China

These deals are lucrative for China, said Jacob Mardell, a former analyst at the Mercator Institute for China Studies, a German think tank, and a journalist covering the BRI.

"This model almost kind of acts as a subsidy for Chinese companies," he told DW. He explained that Chinese banks loan money to governments that then give that money to Chinese construction companies and pay the loan back to the bank over time. This means the money essentially never leaves China, "while the bill is ultimately footed by taxpayers in other countries."

...countries like Pakistan are now stuck paying back large amounts of debt to Chinese lenders. "Pakistan has to pay billions of dollars back in loans, because of reckless investments in the name of CPEC," said Khalid.

Similar cases have previously led to criticism that China is conducting debt-trap diplomacy, allowing partner countries to go into unsustainable amounts of debt to gain political influence.

[Ronaldus Magnus III]

“”Shenzhen, China’s first special economic zone, is the best example. In just four decades, the city’s population grew from around 60,000 inhabitants to more than 17 million today.””

NO ONE moves or resides anywhere in China without the permission of the Chicoms. This ‘special zone’ was allowed to grow. If the Chicoms want 3 million more, they can move anyone the want. If they want to to downsize a town or city, they can move, or eliminate, whoever they desire.

[Zhang Fei]

[NO ONE moves or resides anywhere in China without the permission of the Chicoms. This ‘special zone’ was allowed to grow. If the Chicoms want 3 million more, they can move anyone the want. If they want to to downsize a town or city, they can move, or eliminate, whoever they desire.]

---

IIRC, all these local regions had a fair bit of leeway to put up their own infrastructure, so long as they raised the tax revenues locally. Pakistan may need the central government to fund and authorize all local infrastructure. Given the dysfunction of Pakistan, it’s likely very little has been planned around Gwadar. Which means the new port is basically marooned.

Part of the problem with Xi’s assumption of power is his relentless imposition of unfunded central government mandates, coupled by restrictions on what locals can do to grow their economies. In its way, China is becoming Pakistan.

[Jimmy Valentine]

“Take up the white mans burden, the savage wars of peace, fill full the mouth of famine and bid the sickness cease, and when your goal is nearest, your hope for others sought, watch sloth and heathen folly bring all your works to naught.”- China needs to read Kipling.

[kvanbrunt2]

Depends on what the supply chain will end up being. They can support all kinds of military with this structure. Think of it like our own interstate road system.