Chinese President Xi Jinping in 2013 proposed the construction of the Silk Road Economic Belt and the 21st Century Maritime Silk Road to foster common development between China, Europe and Asia. To promote the initiatives, China has set up the $40-billion Silk Road Fund and spearheaded the establishment of the $100-billion Asian Infrastructure Investment Bank.
Since the One Belt and One Road initiatives were proposed, they were interpreted by some observers as the Chinese answer to the historical U.S. initiative called the Marshall Plan. Officially known as the European Recovery Program, the Marshall Plan invested $17 billion in the rebuilding and bolstering of European economies after World War II (WWII). However, this interpretation ignores essential differences between the two.
Politically, the Marshall Plan aimed at boosting the United States' influence in Europe after WWII in order to confront the Soviet Union-led camp. Thus, its fundamental role was to serve the U.S. Containment Strategy. But the Chinese initiatives do not target any third party or exclude any specific country. They are not politicized, instead advocating cooperation for common development. Thus far, among the more than 60 countries along the proposed Belt and Road, over 50 have responded positively.
The U.S. economy experienced rapid growth during WWII, and the Marshall Plan aimed to export excess U.S. production capacity by developing the European economies. There have been claims that the Chinese initiatives have the same purpose of exporting China's excess production capacity. But it would be more accurate to say that the economic stimulus effects of the construction of the belt and road will benefit other countries alongside their routes much more than China itself.
Moreover, the Marshall Plan not only weakened the economic policy autonomy of aid recipient countries but also came with additional requirements. Through a series of institutional arrangements, it helped lower tariff barriers for U.S. products to enter European countries and expand their market share as well as establish the dominant role of the U.S. dollar in global trade. By contrast, the One Belt and One Road initiatives aim to enhance connectivity among participating countries in terms of policy, infrastructure and trade networks, facilitate monetary circulation and increase the understanding of their people. They represent the mutually beneficial cooperation between developing countries.
In the Marshall Plan, the United States was in a dominant position while the European countries receiving U.S. aid were subordinate. But the Chinese initiatives are based on the equality and mutual benefit of all participants. Both the Asian Infrastructure Investment Bank and the Silk Road Fund are open and inclusive. Their investment will also be denominated in U.S. dollars rather than the Chinese currency, the yuan. Actually, the One Belt and One Road initiatives are platforms created by China for countries along their routes to share development opportunities. They are proposed by China but are not under its sole control, demonstrating China's willingness to take on more responsibilities as a major country and play a more active role in global governance.
The Marshall Plan helped the reconstruction of the war-torn economies of comparatively industrialized European countries. But the One Belt and One Road initiatives aim to drive the economic development of participating countries--most of which are still at the initial stage of industrialization, marked by weak development foundations and poor infrastructure. Therefore the task of the Chinese initiatives is much more challenging.
The One Belt and One Road initiatives are meant to forge a community of destiny of participating countries, which pursues all-inclusive development through improving connectivity and building a broad market spanning Asian and European economies with an Asia-Pacific free trade area as part of it. In the implementation process, the individual needs of each participating country will be given full consideration.
China has already become the largest trading partner of more than 120 countries and regions around the world and the largest export market of about 70 countries and regions. As such, the implementation of the One Belt and One Road initiatives will not only promote China's economic growth and transition but also contribute to the development of the world economy.
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