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Xi Wants Foreign Support for One Belt, One Road

Walter Russell Mead

President Xi Jinping is looking to bolster his One Belt, One Road push with foreign money, the FT reports:

The possibility of co-investment offers a foothold for foreign investors in Xi Jinping’s “One Belt, One Road” policy initiative, a programme to promote Chinese investment in trading partners and address the thorny problem of industrial overcapacity at home.

Mr Xi’s geopolitical vision is paired with a more microeconomic approach from the office of premier Li Keqiang, known as the “international industrial co-operation” scheme.

“Projects in third countries most often arise from long-term and existing relationships in China,” said Giles Blackburne of the China-Britain Business Council, which on Wednesday launched a report on British companies partnering with Chinese counterparts in countries targeted by the One Belt, One Road scheme.

Part of what’s driving the One Belt, One Road strategy is the crippling overcapacity which years of unwise industrial policy have created in China. On a three-day tour of China’s northeast “rust belt” earlier this week, Xi promised “economic restructuting” is on its way. But, as we’ve seen, that’s going to be much easier said than done. It may well then be necessary for China to balance its domestic debts with international assets.

Lenin would have analyzed Xi’s strategy as a classic case of imperialism as the highest form of capitalism: the chronic overcapacity and underconsumption of an exploitative capitalist society leads it into the pursuit of power abroad in order to capture new markets. This brings it into conflict with other overproducing capitalist societies in quest of their own markets for excess goods. This, in turn, leads to war.

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