Over the past three decades, the rise of China has been one of the most frequently examined international phenomena. Discussions about the potential impact of China’s emergence for the rest of the world have recently taken a more concrete turn as the Chinese leadership has abandoned its traditional low-profile in favor of a more assertive stance on the global stage. 

Following the remarkable development of its economy, China’s footprint has expanded globally at an accelerated rate since the turn of the 21st century. Chinese companies, businessmen, workers, students and tourists are now present everywhere around the globe. 

The launch, in late 2013, of what is now known as the “Belt and Road Initiative” (BRI) is personally linked to Xi Jinping and, since 2017, it has been enshrined in the Chinese Communist Party Charter and the Chinese constitution, leaving little doubt about its crucial importance for Beijing. Beijing’s public diplomacy has been proactively promoting BRI as China’s generous gift to the world, one that advances peace and delivers shared benefits (“mutual learning, mutual benefit and win-win results”) and is free of any strategic calculation or intent.

For countries that are urged to “take a ride on the Chinese development express train” and to join China’s “circle of friends,” Beijing’s proposal may sound alluring. China can indeed be seen as an economic opportunity, offering a welcome diversification of commercial markets and capital supply, as well as a geopolitical balancer against other great or regional powers. But going beyond the official rhetoric that accompanies Beijing’s grand plan gives a different perspective on China’s actual aspirations and goals. BRI draws the map of a large region dominated by China, in which other countries are not regarded as equal partners. Rather, the biggest, most powerful, and most technologically advanced state, wants to establish itself at the top and center of a hierarchical and asymmetrical system in which smaller, weaker states in its orbit are unable to challenge its economic and military dominance. The creation of deep interdependencies via the deployment of BRI are meant to eventually constrict other countries’ room for maneuver and make it difficult for them to challenge the system from a position of strength. The political, economic, and security benefits gained through their relations with China serve both as incentives to perpetuate the system and as leverage to force compliance. In particular, trade, and the direct material benefits derived from it, are expected to offer powerful incentives for countries to comply with Beijing’s preferences, given the potential enormous economic cost of doing otherwise.

If the building of a China-led international order or sub-system looks like a very distant prospect, BRI’s more immediate impacts have already become apparent. China has been able to impose the presence of its state-owned enterprises (SOEs) onto half of BRI’s existing and planned infrastructure projects, while its state-owned banks account for more than 90% of BRI’s outstanding loans and equity investments. China’s official commitment not to “attach political strings regarding assistance” to partner countries has translated into opaque bidding and procurement processes, misuse of public funds, as well as undue influence and bribery of public officials. Combined with corrupt practices and lack of accountability, a general disregard for serious feasibility and financial sustainability studies has led to poorly conceived and irresponsibly financed projects, that have put some countries in a bind. The most striking example of what such a toxic combination can lead to is the Sri Lankan government’s 2017 decision to surrender a 99-year lease on the Hambantota port and surrounding land to China Merchant Port Holdings, a state-owned company, in exchange for release from their financial obligations. Although Sri Lanka’s example may be an isolated case of debt-for-asset swap, BRI may bring on other problematic consequences for recipient countries. For example, as demonstrated by a recent study from the Kiel Institute, PIIE and CGDev, the terms of lending contracts contain “unusual confidentiality clauses that prohibit borrowers from disclosing the terms or even the existence of the debt.” Financial deals signed behind closed doors nurture corruption and provide opportunities to exert political leverage and influence the debtors' domestic and foreign policies. Confidentiality clauses also prohibit any public discussions and examination of contracts that will impact the future welfare of the accepting country and of its people.

In addition to financial and political implications in the short term, BRI may also have security consequences for recipient countries in the medium-term. The construction of digital and satellite networks as part of the so-called “Digital Silk Road” and the “Belt and Road Space Information Corridor” as well as the procurement of surveillance and communication technologies under the “Smart Cities” program help Beijing’s accelerate the collection of foreign digital data necessary to enhance its artificial intelligence and machine learning infrastructure and to improve its intelligence and surveillance capabilities. Some of the ports being developed by Chinese state companies in close proximity to critical maritime chokepoints and sea lanes may be intended as dual-use facilities that could be used as support bases for future military deployments to protect Chinese overseas interests and eventually expand China’s military presence further from home, in countries outside of its traditional reach.

In short, the Chinese leadership is not interested in establishing China as a regional player confined to East Asia. Rather, it wants to propel the country outward as a dominant power on the global stage, with BRI as the main instrument to help enhance its overseas influence and strategic position. The combination of incentives and coercive levers generated by BRI could limit the options of recipient countries, expose them to economic and security risks, and eventually constrain their ability to make decisions for the sake of their national interests, as it will become increasingly difficult for them to say no to Beijing’s demands.