China must ensure transparency to boost credibility of Belt and Road projects, former US diplomat says

China must ensure transparency surrounding the projects under its controversial Belt and Road Initiative to attract international investors, said Daniel Russel, the vice-president of the Asia Society Policy Institute and a former top US diplomat in Asia.

The strategy is the cornerstone of President Xi Jinping’s foreign policy that seeks to build infrastructure projects and improve global trade to connect Asia with Africa and Europe, but it has attracted a barrage of criticisms from China’s trading partners over a lack of transparency, corruption, environmental damage, legal issues and labour problems.

“It is in China’s interest to persuade the host countries to provide more transparency, you can’t force them but you can persuade them. For one thing, transparency is the enemy of corruption and corruption is the enemy of successful and financially sustainable projects”, said Russel, who served as the US assistant secretary of state for East Asian and Pacific affairs from 2013 to 2017.

“What I found is that some of the large problems in [Belt and Road Initiative] projects are partly caused by a rush to get a deal agreed. The Chinese side pushes for a memorandum of understanding to get signed to lock in a project before many of the issues of the project – the design and the financing of the project – are figured out.”

Last month, the Asia Society Policy Institute, a US-based policy think tank, published a report outlining 12 recommendations that it said would boost credibility of large scale infrastructure projects under the state-driven belt and road plan, which has also been criticised by the United States for creating “debt traps” for low income countries with weak economic outlooks.