China tries to allay fears over BRI, says it's not an exclusive club

In an apparent reference to "debt trap" criticism and China using BRI as a geopolitical tool to attain superpower status, Xi said BRI is "not an exclusive club".

Beijing: President Xi Jinping on Friday sought to ease global concerns over debt traps and regional hegemony by China using the BRI project, saying his ambitious infrastructure project "is not an exclusive club" and vowed that it will have complete transparency and "zero tolerance" for corruption.

In his inaugural address to the 2nd Belt and Road Forum (BRF) attended by 37 heads of state and governments besides officials from 150 countries and international organisations, Xi said China wants to build its trillion-dollar Belt and Road Initiative (BRI) based on "open, green and clean cooperation".

Chinese President Xi Jinping has promised to promote high financial standards for China's Belt and Road infrastructure-building initiative as Beijing tries to dispel complaints the multibillion-dollar project leaves developing countries with too much debt. Xi avoided mentioning debt complaints in his speech to celebrate his signature foreign initiative.

India has been boycotting the BRI to protest over the USD 60 billion China-Pakistan Economic Corridor (CPEC) being laid through the Pakistan-occupied Kashmir. The CPEC, which connects Gwadar Port in Pakistan's Balochistan with China's Xinjiang province, is the flagship project of BRI.

This time, the US also joined India in skipping the BRF.

The Trump administration has been extremely critical of the BRI and is of the view that China's "predatory financing" is leaving smaller counties under huge debt endangering their sovereignty.

In an apparent reference to "debt trap" criticism and China using BRI as a geopolitical tool to attain superpower status, Xi said BRI is "not an exclusive club".

"Everything should be done in a transparent way and we should have zero tolerance for corruption," Xi said.

Xi said China will not engage in beggar-thy-neighbour currency devaluation.

China will continue to improve the exchange rate formation mechanism of its currency, the renminbi, and keep the exchange rate generally stable on a reasonable and balanced level, he said.

Chinese officials reject such complaints and issued guidelines this week for assessing debt risks to Belt and Road borrowers. Xi told the participants that China would encourage investment and financing from multiple sources. He has called other countries to provide a 'friendly and fair' environment for Chinese enterprises to engage in international exchanges.

Xi said the joint building of the Belt and Road has opened up new space for the world's economic growth and it has also created a new platform to boost international trade and investment, expanded new practices to optimise global economic governance, and made new contributions to improving people's well-being in all countries.

China on Thursday signalled that it is seeking to address the concerns of debt financing with a promise of "sustainable financing" for smaller countries to ease the debt burden.

Concerns over BRI financing became vocal after China acquired Sri Lanka's strategic Hambantota port on a 99-year lease as a debt swap in 2017.

The BRI was launched by President Xi when he came to power in 2013. It aims to link Southeast Asia, Central Asia, the Gulf region, Africa and Europe with a network of land and sea routes.

China is doling out huge sums of money for infrastructure projects in countries from Asia to Africa and Europe, enhancing its global influence.

Russian President Vladimir Putin, Pakistan Prime Minister Imran Khan, Nepal President Bidhya Devi Bhandari, Myanmar state councillor Aung San Suu Kyi are among the top leaders taking part in the event. Besides, France, Germany, the UK, Spain, Japan, South Korea and the EU will send high-level representatives to the forum.

Unlike his 2017 speech to the first BRF during which he announced about USD 124 billion additional financing for BRI projects, Xi's address this year has not contained any monetary announcements pledging fresh capital for the projects.

His speech highlighted on “co-development” focussing more on deflecting criticism and doubts about the multibillion-dollar initiative.

His speech was delivered just hours after an announcement by President Trump that Xi would visit the White House “soon”. Some of the measures announced in Xi's speech have been under lengthy discussions during the trade talks with the US, the Hong Kong based South China Morning Post reported.

In his address, Xi vowed to abolish subsidies to firms that impede fair competition -- addressing a major bone of contention in US trade talks.

He promised to prohibit forced technology transfer and said China will be protecting legitimate rights and interests of foreign owners of intellectual property rights.

China will create a business environment in which the value of knowledge is respected, he said. China will support 5,000 people from the innovation sector in Belt and Road countries in conducting exchanges, training programmes and joint researches in the next five years.

China will work with other participants of the BRI to promote scientific and cultural exchanges, Xi said.

China will allow foreign investors to operate businesses in more sectors with controlling or full stake. China will also negotiate and sign high-standard free trade agreements with more countries, Xi added.

China will work with other parties to promote a coalition of sustainable cities and an international coalition for green development under the BRI, he said.

A total of 10,000 representatives of political parties, think tanks and non-governmental organisations from countries participating in the Belt and Road Initiative will be invited to China for exchanges in the next five years, he said.

He said China will increase imports of goods and services on a larger scale.

China will further lower its tariff rates and continuously open up its market and welcome quality products from around the world. He also called on all countries to create a sound investment environment and treat Chinese enterprises, students and scholars abroad as equals, he said.