China’s grand visions—the Belt and Road Initiative, the AIIB, and civil-military fusion—are undermined by arbitrary rule changes driven by Communist Party interests.
By exposing the AIIB’s origins in excess production and politically motivated lending, this section reveals a strategy rooted in power projection rather than sustainable economic development.
2017-08-05
The following is a continuation of the previous chapter.
The Belt and Road as a hard sell.
Fukushima.
China is spreading grand visions such as the Belt and Road Initiative, the AIIB, and civil-military fusion, but if the basic commitments to market rules necessary for fair economic development are arbitrarily changed at the convenience of the Communist Party, there is no way such plans can succeed.
Yaita.
As for the reality of the AIIB, it all started with the Belt and Road.
Within China, overproduction of steel, cement, and similar materials had become a serious problem.
As the economy slowed, these products sold even less.
Unemployment also rose.
What Xi Jinping then focused on was overseas markets.
He brought proposals to neighboring countries, Afghanistan and others, offering to build ports or lay railways.
The grand justification created for this was the “Belt and Road.”
It was presented as the revival of the ancient Silk Road.
There are land and maritime Silk Roads, and he even called them “the two wings on which China will take flight” (laughs).
In the days of the original Silk Road, European nobility sought Chinese tea, silk, ceramics, and other goods.
When there are goods and people who want them, roads naturally emerge.
But today, there is nothing in Europe that people want among Chinese products (laughs).
So China decided to forcibly “build roads” in Central Asia and the Middle East.
Naturally, local people would want such infrastructure.
But they had no money.
So China decided to lend it to them, which is how the AIIB was created.
The idea was to have them buy Chinese products with that money.
However, there are already many financial institutions such as the Asian Development Bank, the IMF, and the World Bank.
If funds are needed for legitimate projects, money can be borrowed from those institutions without difficulty.
So why don’t they lend?
Because the borrowers don’t repay.
Politics are unstable, and building ports in places with nothing offers no chance of profitability.
A normal bank would reject such projects during screening.
But the AIIB lends anyway (laughs).
These loans will inevitably become non-performing assets.
From the outset, it is a bank destined to fail.
Japan has started saying it might be fine to join, though.
Fukushima.
That’s just lip service, right? Will Japan really join?
Yaita.
We still don’t know how Trump will act.
You never know when he might pull the ladder away.
Fukushima.
Even if the United States joins, Japan does not need to.
At its core, the AIIB is part of China’s national strategy—to build infrastructure such as highways and high-speed railways in order to create routes by which troops can be transported over land.
It is a blueprint conceived within China’s hegemonic strategy, making it a plan “by China, for China.”
Initially, it was envisioned as a financial institution fully controllable by China.
However, with 80 countries and regions participating—including serious European nations—it has become increasingly difficult for China to do whatever it wants.