China launched its Belt and Road Initiative (BRI) aiming to promote infrastructure connectivity, trade and investment deals and regional cooperation across Eurasia. Except for the objective of BRI for economic growth, it inherently possesses goals and ideas to promote and achieve sustainable development. This Chinese initiative, if effectively exert its influence and deepen its efforts in relevant areas, will act as a driving force for not only regional economic cooperation but also green and sustainable development. Integrating a sustainable development mind in BRI investment projects and cooperation would give rise to a new of multilateralism for global governance.
Chinese Foreign Minister Wang Yi and Miroslav Lajcak, the president of the 72nd Session of the UNGA expressed their shared notion that BRI and 2030 Agenda for Sustainable Development have same general orientation. UN Secretary-General Guterres also noticed and suggested that BRI and Sustainable Development Goals (SDGs) have shared idea for global development. Both BRI and SDGs intends to provide opportunities, create win-win cooperation, and promote global public goods. The link between BRI and SDGs mainly lies in China’s commitment to deepen connectivity in infrastructure, trade, finance and promote common, green and sustainable development, as well as for the benefit of people along BRI.
In order to achieve SDGs via BRI investment projects, China has made efforts in various aspects. At general level, China has made progress in poverty reduction and is taking a leadership in climate change. For BRI specific efforts, firstly, China committed itself to invest in transport infrastructure projects (e.g. port, bridge, and highway) along BRI countries, as well as devoted to green energy projects with support of green energy loan provided by New Development Bank (NDB). To support sustainable infrastructure, many financing institutions and private financing instruments are encouraged to involve in BRI. The Asian Infrastructure Investment Bank (AIIB) plays an important role in financing BRI projects and address environmental goals. The Environmental and Social Framework of AIIB precludes socially and environmentally harmful projects and requires client to undertake environmental and social assessments. In addition to AIIB, the Silk Road Fund (SRF), the China Investment Corporation (CIC), the China Export-Import Bank and the China Development Bank also play critical roles in financing BRI projects.
However, the impact of BRI for achieving and promoting SDGs will be greatly reduced, if certain concerns cannot be addressed or certain aspects cannot be guaranteed. Firstly, to promote BRI as global governance for sustainable development, SDGs should not be only set as an second goal but be equal important to economic growth. Otherwise, it won’t have any structure change for current framework but rather a quantitive innovation. Secondly, uncertainties on financing scheme of major investment project could raise concerns concerning the implementation of projects, and the distribution of financial burden. Thirdly, current China’s economic and environmental situations would reduce the expectation of the sustainability of investment projects. Since BRI is a China-led initiative, the slowing-down economy of China may affect China’s support and influence on BRI. From environmental perspective, China at present still faces major social and environmental problems - water and air pollution issues and carbon emission issues that need to be addressed. It is questionable which level of standards that could be used to assess BRI relevant infrastructure investment projects.
Moreover, only self-regulatory rules or sustainable development statement cannot guarantee the fulfillment of SDGs. Relevant goals and requirements should be transferred in national and international rules, especially commercial rules, and agreement. Last but not least, since Chinese development projects, especially overseas investment undertaken by Chinese state-owned enterprises (SOEs), have often been criticized for negative social and environmental effects, it is concerned that multinationals and Chinese SOEs as major investors involved in BRI large projects may not have clear obligations or requirements for responsible business conducts.
Further steps should be done by China alone and cooperating with countries along BRI as well as international institutions. Firstly, to be consistent with SDGs, it is important to ensure new infrastructure project is low-carbon and climate-resilient. Investment in BRI countries must comply with higher environmental and social governance (ESG) standards. This may require clear policies guidelines, risks assessment for financing, as well as tightened or improved climate and environment regulations. Secondly, technology is key tool to reach the SDGs. China could cooperate with other BRI countries to promote the adoption of new green technologies in relevant projects. Thirdly, the sustainability of infrastructure along BRI cannot be guarantee without certain financing schemes or capital support. Apart from above-mentioned institutions, it is important to explore co-financing opportunities across domestic and international institutions and across different countries. Both public and private resources are critical to BRI projects, thus promoting of public-private partnership could also be a major option. Furthermore, international guidelines on corporate social responsibility, responsible business conduct, and guidelines for multinationals should play a part in BRI investment projects. It helps to build the reputation of Chinese investors overseas. Finally, to better integrating SDGs into BRI, China must keep close cooperation with UN.
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