Capital flow restrictions prove to be a hurdle for China’s ambitious Belt and Road Initiative
Industry players say difficulties moving capital between participating countries is limiting the success of Beijing’s ambitious project
Issues with moving capital between countries involved in the Chinese government’s ambitious “Belt and Road Initiative” are limiting the success of the project, according to industry players.
“The major problem facing the Belt and Road Initiative is the flow of capital,” said Justin Kwok Hung-chiu, executive director of CK Asset Holdings, at the MIPIM Asia Summit, a leading property conference, on Tuesday.
“Whether there is free flow of capital into the country and whether you can repatriate your capital, these are major issues.”
He said a key challenge for businesses looking to invest was strict KYC, or know-your-customer, requirements, which banks use to identify and verify the identity of their clients to reduce financial crimes such as money laundering and fraud.
Initiated by Xi Jinping in 2013, the belt and road plan is aimed at building infrastructure, including railways, ports, airports and roads, in countries neighbouring China and in other parts of Asia, the Middle East and Europe, to boost trade flows and economic growth.
Certainly in the last six months, we noticed a slowdown in the outbound investment along the Belt and Road