India
Author: Apurva
Source: indianexpress.com

China will host the Belt and Road Forum (BRF) over two days starting May 14 in Beijing where high-level delegations, including 29 Heads of State, will gather to discuss President Xi Jingping's ambitious strategy and accelerate the pace of its implementation. China's One Belt One Road (OBOR) strategy envisions an overland Silk Road Economic Belt and the 21st Century Maritime Silk Road to foster trade and enter new markets.

What is the Belt and the Road?

The strategy aims to connect Asia, Europe and Africa, particularly the developing East Asia economic circle at one end and developed European economic regions at the other. The Belt refers to the Silk Road Economic Belt which comprises three overland routes: connecting China, Central Asia, Russia and Europe; linking China with the Persian Gulf and the Mediterranean Sea through Central Asia and West Asia; and connecting China with Southeast Asia, South Asia and the Indian Ocean. The Road refers to the 21st century Maritime Silk Road designed to push trade from China's coast to Europe through the South China Sea and the Indian Ocean in one route, and from China's coast through the South China Sea to the South Pacific in the other.

Why is OBOR so important for China?

While the BRF will host 29 Heads of State and over 100 ministerial-level officials to increase international cooperation, the OBOR policy itself is aimed at boosting domestic growth in China which has slipped in recent years. Experts maintain that OBOR is China's blueprint for economic diplomacy, and its strategy to begin a second phase of 'opening up'. Experts also believe China felt "isolated", considering it is not involved with G7, and is limited to the BRICS countries. They say China needed another window to continue its economic expansion, and OBOR fits the bill.

What changed for China to adopt a new strategy?

This year, China cut its GDP growth target to 6.5%, the lowest in 25 years. With a global slowdown, China needed a new model of development to maintain its spectacular economic success story. OBOR envisions largescale infrastructure creation in China and OBOR linked countries, which the government hopes will keep the economy ticking. There are two versions of OBOR — domestic and international. Experts pin the slowdown on changes in exports, investments and local consumption. A shift in US policy after Donald Trump's victory, and the rise of protectionist tendencies in the west, has resulted in shrinking markets, while investments in China have gradually reduced due to rising labour costs, increased traffic on roads, and air pollution and environment concerns. Experts also believe consumption in China has decreased with slower growth of the middle class. OBOR visualises a shift from developed markets in the west to developing economies in Asia, and a shift in China's development strategy itself — concentrating on provinces in central and western China instead of the developed east coast region.

How will it be implemented?

At its core, OBOR would need the eastern (developed) parts of China to trade with the US and developed countries, while the central and western provinces, which have witnessed minimal growth, will feed Asia's developing countries. However, a major roadblock for OBOR at present is the lack of infrastructure in South and Southeast Asia to foster trade. China hopes to work with interested countries and improve connectivity of their infrastructure construction plans and technical standard systems. OBOR also requires the construction of international trunk passageways and an infrastructure network connecting all sub-regions in Asia, and between Asia, Europe and Africa.

What is needed for OBOR to get going?

Zhao Kejin, Deputy Secretary General and Professor, Institute of Global Development, Tsinghua University, believes several countries along the Silk Road have not yet established a market economic system, and that their domestic markets need more regulation and infrastructure. "The railway, highway and pipeline capacity along the Silk Road also has to be improved, as do transport facilities," he said. Joining OBOR gives access to China's experience and expertise in building infrastructure and connectivity. "There are so many infrastructure companies in China that there is a sort of over-capacity. China wants to use this resource, and many developing countries will benefit from it," he said.

And what does OBOR mean domestically for China?

The Chinese government has dovetailed all major government policies with OBOR. The engines of OBOR are three economic circles in China: Guangdong, Macau and Hongkong; Beijing, Tianjin and Hebei, and Hunan province. China has adopted a two-pronged strategy domestically — a national policy and a city-level policy. OBOR is also shaped to for 'domestic readjustment' in China to shift the focus of development from the east coast provinces, which have benefited from the economic boom these last 25 years, to the central and western provinces.

What has China committed to OBOR?

It has committed a total of about $100 billion to three new infrastructure funds: a $ 40 billion fund to the Central Asia-focused Silk Road Fund, a $ 50 billion fund to a new Asian Infrastructure Investment Bank (AIIB) and a $ 10 billion fund to the BRICS-led New Development Bank.

USA
Author: Baris Balci, Enda Curran
Source: www.bloombergquint.com

(Bloomberg) -- China's economy shows no signs of crisis even as the country's crackdown on financial leverage has wiped almost $500 billion from domestic markets, former Goldman Sachs Asset Management Chairman Jim O'Neill said.

"This continues to be completely overblown," O'Neill, former commercial secretary to the U.K. Treasury, said in response to emailed questions. "China has demonstrated multiple times that it's very good at dealing with its cyclical challenges. Arguably if other countries' monetary and fiscal policy could be adjusted with the success of China, the world would be a much stronger place."

President Xi Jinping's pledge to rein in financial risk has rattled investors, prompted the cancellation of debt sales and compelled the central bank to pump liquidity into markets. The push for safety has stoked fears the economy, which grew 6.9 percent last quarter for its first back-to-back acceleration in seven years, may be set to slow through the year.

While China's economy picked up in the past two quarters, giving authorities room to tighten regulation with the aim to clean up the country's financial system, there are some signs of softening. Producer price gains slowed more than expected in April meaning stronger industrial profits may be harder to sustain and corporate debt burdens may grow heavier.

"At some point, they'll have a crisis, just like everyone else," O'Neill said. "But I see no signs of it from this supposed slower growth."

'Biggest Story'

O'Neill, an economist who gained prominence for coining the term BRIC nations a decade and a half ago to describe emerging market powerhouses Brazil, Russia, India and China, said the "biggest story in the world" remains the rise of consumers in emerging markets. "It's easily more important than the U.S. and Europe for the future of the world."

China fits that bill, with its burgeoning middle class increasingly fueling growth through services, which now account for more than half of output, and consumption.

Beyond China, O'Neill said economies with large current-account deficits and low savings, including Turkey, look vulnerable to shifts in global sentiment and need to lower their reliance on foreign capital.

For the U.K. economy, O'Neill said there's likely pain ahead as the country withdraws from the European Union. But it's not the only pressing issue facing Britain's policy makers.

"It's our internal skills and educational challenge, our weak productivity, the geographic imbalance between London, the southeast and the rest of the country, and the intergenerational imbalance," O'Neill said.

China
Author: Lu Wen'ao
Source: www.globaltimes.cn

Russian President Vladimir Putin will play an "active" role in the upcoming Belt and Road (B&R) Forum in Beijing, Russia's ambassador to China said.

"Russia welcomes the B&R Forum," Andrey Denisov said through an interpreter. "Given the partnership between our countries … President Putin will play an active role there."

The high-level international forum, with the attendance of leaders from 29 countries and regions as well as UN Secretary-General Antonio Guterres, International Monetary Fund chief Christine Lagarde and World Bank President Kim Yong, will be held from May 14 to 15.

"We [Russia] applied to take part in all of the forum's events," Denisov told reporters on Thursday. "At each panel discussion, we would like to offer our views on prospects for integration cooperation."

The China-proposed B&R initiative was launched in 2013 to develop infrastructure and strengthen ties among countries along the Silk Road Economic Belt and the 21st Century Maritime Silk Road.

China and Russia share infrastructure development plans in the Far East region, with the two countries hoping to improve rail and road connections.

Xi and Putin are expected to communicate throughout the year, Denisov said.

They met at high-level international forums, including the Shanghai Cooperation Organization summit in June in Astana, Kazakhstan, the BRICS summit in Xiamen, East China's Fujian Province in September and the Asia-Pacific Economic Cooperation forum in Vietnam in November.

Xi and Putin may discuss the Korean Peninsula issue at the B&R Forum, Denisov said.

He stressed that both China and Russia agreed to tackle the problem diplomatically instead of ways which increase tensions on the peninsula.

"Large-scale military exercises are becoming increasingly intimidating, inducing North Korea and other countries to take measures to defend their national security," the ambassador said.

But with newly-elected South Korean President Moon Jae-in, who has a softer stance on the issue, tensions on the peninsula are likely to ease.

India
Source: www.business-standard.com

India's concerns are well founded; project has not been conducted with any consultations

Citing concerns over the China-Pakistan Economic Corridor's (CPEC's) impact on its sovereignty, India on Sunday skipped the opening ceremony of China's Belt and Road Forum. (Read more) However, while India has stuck to its guns on the matter, it could very well find itself alone when it comes to any recognition of its concerns.

The meeting, called the Belt and Road Forum (BRF), is being attended by 29 heads of state and governments, including Prime Minister of Pakistan Nawaz Sharif and his Sri Lankan counterpart Ranil Wickrmasinghe, besides official delegations from other South Asian countries. Leaders and officials from various countries, including Russia, US, Japan, UK, Germany, and France, are attending the meeting.

India's caution is well founded

Speaking on the matter, Ministry of External Affairs spokesperson Gopal Bagley explained: "...No country can accept a project that ignores its core concerns on sovereignty and territorial integrity."

As explained in a recent Business Standard editorial, India's objection to CPEC is legitimate. After all, China routinely blocks any international funding of projects in Arunachal Pradesh on the ground that it is disputed territory. Of late, it has even raised objections to the central government undertaking projects in that state. It is hypocritical then for Beijing to justify undertaking projects in Pakistan-occupied Kashmir (PoK). But India should be cautious about participating in other components of the One Belt and One Road (OBOR) initiative as well. (Read more)

While it is true that notwithstanding Chinese activities in PoK, India saw merit in joining the Asia Infrastructure Investment Bank (AIIB), the BRICS Development Bank and the Shanghai Cooperation Organisation (SCO), all initiatives led by China, the difference is that India was actively involved in shaping the architecture of the AIIB and the Development Bank, their lending policies, and is represented at senior levels in these institutions. The SCO, too, is a multilateral institution and members have an important say in its policies. But the OBOR initiative does not fit into this pattern. India had conveyed to China that a similar consultative process was even more important for such an ambitious undertaking. The Chinese apparently want India to first sign on to the initiative before getting into the specifics of India's role, the choice of projects and financing. If this, indeed, is the case, then India's caution is well founded.

Xi's trade plan gets Trump on-board OBOR

At the last minute, China managed to rope in the US for its Silk Road summit. South Korea, the European Union and Japan also confirmed their participation in the high-profile event. (Read more)

The Trump administration announced that Matt Pottinger, Special Assistant to the President and senior director for East Asia of National Security Council of the White House, would lead the US delegation to attend the OBOR Forum.

"The United States recognises the importance of China's One Belt and One Road initiative and is to send delegates to attend the Belt and Road Forum May 14-15 in Beijing," a joint statement by China's finance and commerce ministries said.

The US attendance at the summit was a concrete result of Xi's trade plan, Finance Vice-Minister Zhu Guangyao told the media. The US participation came after the two sides clinched a lucrative trade agreement which will boost shipments of American liquefied natural gas, beef and other products to China. In turn, Chinese banks and poultry will get access to the US market. The deal follows pledges by US President Donald Trump and Xi during a summit in Florida to address a $350 billion trade imbalance in China's favour by coming up with concrete measures within 100 days.

China is willing to splurge on the initiative

Chinese President Xi Jinping pledged $124 billion on Sunday for his ambitious new Silk Road plan, saying everyone was welcome to join what he envisioned would be a path to peace and prosperity for the world.

The summit marks the formal launch of China's ambitious and potentially game-changing initiative to build a network of transport and economic corridors across Asia and Europe with China as the nodal point.

China has touted what it formally calls the Belt and Road initiative as a new way to boost development since Xi unveiled the plan in 2013, aiming to expand links between Asia, Africa, Europe and beyond underpinned by billions of dollars in infrastructure investment.

Xi pledged a massive funding boost to the new Silk Road, including:

• An extra 100 billion yuan ($14.50 billion) into the existing Silk Road Fund

• 250 billion yuan in loans from China Development Bank

• 130 billion yuan in loans from Export-Import Bank of China

• 60 billion yuan in aid to developing countries and international institutions in new Silk Road countries

• Encouraging financial institutions to expand their overseas yuan fund businesses to the tune of 300 billion yuan

• 2 billion yuan in emergency food aid

• $1 billion to a South-South Cooperation fund

• $1 billion for cooperation projects in countries on the new Silk Road

South Africa
Author: Barry Dwolatzky
Source: ventureburn.com

Many have asked if the association between Brazil, Russia, India, China and South Africa has any real significance. Will it benefit the economies of member countries and citizens? The short answer is simply that it's still too early to tell.

Brics currently operates at two levels. Viewed from the top down, the work of Brics is carried out at an annual summit attended by heads of state, senior ministers and officials.

Decisions that have been made at these summits include a proposal for the construction of an optical fibre submarine telecommunications cable system, linking all Brics countries (agreed in India in 2012) and establishing a New Development Bank, to be called the Brics Bank (accepted at the summit hosted in Brazil in 2014).

The other level of Brics activity is being driven from the bottom up. Various working groups have been established to work on developing detailed strategies and proposals that are then presented at an annual summit.

One of these groups is the Brics Working Group on Innovation and Collaboration on ICT and High Performance Computing (HPC), which held its first meeting at the University of Guangzhou in China between 22 and 26 April.

A small group of delegates represented each of the Brics countries at the meeting, which was chaired jointly by China and South Africa, and I was one of the South African delegates.

'Cultural and economic differences may inhibit innovative digital startups'

The meeting dealt with a number of topics including research collaboration, sharing HPC resources and establishing a Brics cloud infrastructure. Ways in which "high tech" small businesses and startups can be supported were also discussed.

To fully appreciate the scope for Brics to support small businesses and digital startups, you need to appreciate the combined size of the member countries.

Brics countries have a total population of 3.6 billion people, or 40% of the world's population. Collectively, their gross domestic product (GDP) in 2015 was $16.6 trillion, or 22% of gross world product.

The members of Brics are also all leading developing or newly industrialised countries with major influence in each of their geographical regions.

Can tech startups prosper?

Surely then, small technology-based businesses operating in one or more of the Brics countries should have exciting prospects of success? This question formed the basis of a roundtable discussion, which I chaired, at the working group meeting.

It became clear that historical, cultural and economic differences between the five Brics countries may inhibit innovative digital startups hoping to benefit from access to the collective economy. On the other hand, the Brics countries share many common challenges and opportunities.

If it were possible to leverage such shared opportunities, while dealing with differences and diversity, huge benefits could flow.

Working together

As an example, consider a hypothetical startup in South Africa that has developed an innovative medical diagnostic device that connects to a smartphone.

By working with collaborators across several Brics countries it may be possible to manufacture the device in China, carry out software integration in India, and test and adapt the functionality of the device to meet both South American and African conditions via partnerships in Brazil and South Africa.

'Collaboration will need facilitating, organisational arrangements, facilities'

This kind of collaboration will need facilitating, organisational arrangements and facilities, such as a network of digital incubators in all Brics countries, and access to seed funding and other support. The prospect of setting up such support structures was discussed at the working group in Guangzhou.

If Brics is to really succeed it will need to work from the bottom up finding ways to solve shared problems. Digital startups could certainly provide a very valuable vehicle to solve develop solutions.

China
Author: William Jones
Source: usa.chinadaily.com.cn

It was no doubt the unique circumstances of China's internal and external developments during the first decade of this century that convinced President Xi Jinping to place the Belt and Road Initiative at the top of China's foreign policy agenda.

First, it corresponded well with the overall economic situation. China had become the second-largest economy in the world, and the technological advances it had made, particularly in a number of fields like high-speed rail, had astonished the world. It also possessed the financial means of initiating a program of such magnitude, which comprises the Silk Road Economic Belt and 21st Century Maritime Silk Road.

Second, it was the ideal platform for a "good neighbor policy". The rise of China, the largest country in the region by far, had created some concerns among its smaller neighbors. But a China which showed itself willing to help them move forward on the road to progress could not be seen as anything but an important benefactor

And third, it converged nicely with the "Go West" policy. Developing the western region of China thus became more than a social and moral imperative. With new rail connections established to Central Asia and further on to Europe, the western region has become central to the development of this project, with cities like Chongqing, Chengdu, Xi'an and Lanzhou now becoming major transit hubs for the Belt and Road traffic.

More importantly, China has reinvigorated with the Belt and Road spirit, the spirit which imbued the ancient Silk Road with its profound exchange of both goods and ideas. That was a period of time during which there was a tremendous exchange of goods - silk, spices, jade and gold.

But there was also an important transmission of ideas and cultures, of styles, fashion and music, indeed one of the first attempts to create an international dialogue of cultures, a transmission of different philosophies and outlooks, each enriching the others in a glorious intellectual interplay. Along the ancient Silk Road appeared important centers of intellectual activity in places like Samarkand, Bukhara (both in modern-day Uzbekistan) and Alexandria (in Egypt). The transmission of culture along the Silk Road provided the basis for the advancement of culture in Egypt and Greece, leading to the development of European culture itself, coming out of Greece and Sicily.

Another aspect of the Belt and Road agenda has to do with China's growing role on the global stage. Given the tremendous turbulence characterizing the world situation in the last decade - the economic crisis in Europe and in the United States, the continual deterioration of the conditions in developing countries, and the spread of international terrorism, enflamed by the numerous military interventions by the US and NATO into various Middle Eastern and North African countries - the Belt and Road represented a bright light in an otherwise uncertain world. Already it has created a sense of optimism, not only in Asia but also in Africa and Latin America.

The unprecedented success of the Asian Infrastructure Investment Bank, which has mobilized the majority of the world's population behind it, has engendered a feeling that the world can now go forward, after many years of economic stagnation. The adherence of the BRICS group to the Belt and Road perspective has largely brought the great majority of the world's population behind the initiative.

The enthusiasm for the Belt and Road Initiative has been enhanced by the fact that it was China that put forward the proposal. China remains the only developing country which has succeeded, in the post-Cold War period, to move in the direction of becoming a moderately prosperous nation. And such a development by the largest country in the world, demonstrated to other developing countries that they too could move from poverty to prosperity.

In China's case, this involved a conscious attempt to "leapfrog" from the low-wage production that characterized Chinese production in the early days of reform and opening-up to higher-value production. The conscientious striving for the "cutting-edge" technologies, including the ambitious Chinese space program, became a "science driver" for the Chinese economy.

Countries in Africa and Latin America gained valuable lessons from the Chinese experience and were therefore very open to working with China in advancing their own prospects. Infrastructure investment plus an emphasis on developing science and technology was proving to be the road to success.

China has made it a priority to utilize that model in order to help benefit its neighbors - both near and far. Investment in infrastructure, in particular transportation infrastructure, creates the network for a functioning industrial structure and a flourishing trading pattern, increasing overall productivity by providing access to wider markets for both agriculture and industry, and quicker turnover and less travel time for people and goods in the urban centers.

The Belt and Road Initiative represents much more than simply a needed development program. It is a key element in a new model of governance in the world. The era in which politics was determined by a single power is really at an end. While the US remains militarily the most powerful country in the world, new countries have come forward and taken their place in the world arena, China being the most striking example. Russia, too, has fought its way up from the destruction incurred by the post-Soviet malaise and dismantlement of key scientific and industrial structures. And in spite of its continued difficulties, India has become a key player in world politics.

While China has the financial capability of initiating the Belt and Road project with its own financial institutions, such as China Development Bank and the Export-Import Bank of China, Beijing's initiative in establishing the AIIB in October 2014 represented a new directionality for the world economy as well as a major boost to developing countries' role in the world economy.

The Belt and Road Initiative is much more than a framework of economic cooperation. It is an alternative philosophy for the interaction of countries, indeed, a dialogue of cultures. And while the Silk Road spirit imbues the spirit of the Belt and Road Initiative, it also contains an element that is characteristically Chinese and stems from Confucius, particularly Confucius' saying: "The superior man is aware of righteousness, the inferior man is aware of advantage." The Belt and Road Initiative at the deepest level is concerned with the question of "righteousness" in economic affairs, characterized by Xi's continual emphasis on the feature of its "win-win" cooperation.

The author is the Washington Bureau chief of Executive Intelligence Review. The article is an excerpt from his article, "The Belt and Road Initiative: Charting a New Trajectory for Mankind" in China International Studies.

China
Author: Justin Yifu Lin/Yan Wang
Source: usa.chinadaily.com.cn

Despite the apparent tranquility of this year's spring meetings of the International Monetary Fund and World Bank, there are reasons to be concerned about the global economy. The United Kingdom's impending "hard" Brexit from the European Union and US President Donald Trump's anti-globalization agenda are creating economic uncertainty, and will continue to do so for some time.

In contrast to Trump, Chinese President Xi Jinping has come to the defense of globalization, and made new capital available for creating global public goods, enhancing connectivity, and creating jobs in developing countries. More than 60 countries have welcomed Xi's Belt and Road Initiative, and 29 heads of state and government will attend the Belt and Road Forum for International Cooperation in Beijing on May 14 and 15. So, what is China's rationale for pursuing this grandiose vision－one that so many countries, especially in the developing world, have embraced?

In our new book, Going Beyond Aid: Development Cooperation for Structural Transformation, we argue that official development aid (ODA) need not always be concessional, and make the case for going "beyond aid", toward a broader approach－like that taken by China－that includes trade and investment. Right now, the Organization for Economic Cooperation and Development's definition of ODA does not even include some of the more effective instruments for facilitating structural transformation in recipient countries, such as equity investment and large non-concessional loans for infrastructure.

By combining aid with trade and investment, donor and recipient countries alike can benefit. For example, the South-South development cooperation uses all three activities to capitalize on recipient countries' economic strengths. This allows the South-South development cooperation to avoid the bottlenecks in partner countries that one sees under the standard ODA model, which separates aid from trade and private investment－and thus impedes countries from exploiting their comparative advantages.

In our book, we look at this topic through the lens of new structural economics. NSE treats modern economic development as a process of continuous structural change in technologies, industries, and hard and soft infrastructure－all of which increases labor productivity, and thus per capita income.

According to NSE, the most effective and sustainable approach for a low-income country to jumpstart dynamic growth and development is to develop those sectors in which it has latent comparative advantages: where production costs are low, but transaction costs are high due to inadequate hard and soft infrastructure. Governments can help to reduce transaction costs by creating special economic zones or industrial parks, improving infrastructure, and making the overall business environment more attractive in those enclaves. With this approach, a developing country can grow dynamically, and create a virtuous circle of job creation and poverty reduction, even if its overall infrastructure and business environment are still lacking.

Moreover, large emerging-market economies such as China, Brazil and India can use their comparative advantages in infrastructure and light manufacturing to help others. For China, this is in keeping with a Confucian dictum: "One who wishes himself to be successful must also help others to be successful; one who wishes to develop himself must also help others to develop."

China has a clear comparative advantage in infrastructure construction, owing to its lower labor costs (the cost of a project site foreman in China is one-eighth that of OECD countries) and vast domestic market, which have enabled it to achieve economies of scale that other countries simply cannot. Consequently, the overall construction cost for high-speed rail in China is two-thirds of what it is in industrial countries.

But China's comparative advantages in 46 of 97 subsectors－particularly in manufacturing－benefit other developing countries, too. As labor costs in China rise, labor-intensive industries are relocating to lower-wage developing countries, providing millions of job opportunities. For example, the Huajian Shoemaking Company, C&H Garments and China JD Group (an apparel maker) are now operating in special economic zones in, respectively, Ethiopia, Rwanda and Tanzania.

In addition to exporting its comparative advantages, China also deploys "patient capital", which has a maturity of 10 years or more. In a recently published paper, we conceptualize patient capital as an investment in a "relationship", whereby an investor has a long-term stake in a country's development. Patient-capital owners are like equity investors, but they are willing to "sink" money in the real sector for an extended period of time.

Patient-capital owners are also more willing, and better able, to take risks. A country's net-foreign-asset position correlates strongly with its long-term orientation. On the other hand, net-foreign-asset positions of countries with a short-term orientation and a low savings rate tend to deteriorate, while their foreign debts mount.

Patient capital plays an important role in infrastructure financing, because it is often accompanied by technological and administrative know-how, which helps to improve global connectivity and accelerate development.

So far, China's large reserve of patient capital has been used to finance its domestic projects. But it will increasingly be exported as more Chinese enterprises and banks "go global". In fact, China could soon become the world's largest net creditor, and a portion of its net foreign assets will take the form of patient capital that is suitable for improving infrastructure, developing manufacturing sectors, and creating jobs around the world.

Since 2015, development finance has started to come less from traditional aid, and more from development-finance institutions, development banks and sovereign wealth funds in emerging economies. China, for example, has committed $60 billion in development financing to Africa for the 2016-18 period－much of it patient capital.

China and other emerging economies are also shifting from bilateralism to multilateralism, by working with partners from the global North and South. As new South-led institutions such as the Asian Infrastructure Investment Bank and the BRICS New Development Bank work with established multilateral development banks, they are learning to be better partners, and adding momentum to global development efforts.

China, moreover, is trying to learn from its partners so that it can improve its own governance, labor and environmental standards. And this two-way process is giving rise to new ideas, theories, and concepts－our book being one of them. China's embrace of a global role should be welcomed. We are cautiously optimistic that the North and South can work together to ensure peace and prosperity for all.

Justin Yifu Lin, a former chief economist at the World Bank, is director of the Center for New Structural Economics, dean of South-South Cooperation and Development, and honorary dean of the National School of Development, Peking University. And Yan Wang is a senior fellow at the Center for New Structural Economics, Peking University.

Russia
Source: www.mid.ru

The Annual Meeting of the Board of Governors of the European Bank for Reconstruction and Development (EBRD) was held in Nicosia, Cyprus, on May 9–10. A Russian interdepartmental delegation led by Minister of Economic Development Maksim Oreshkin took part in it.

The violation of Russia's rights as one of the Bank's faithful shareholders and compliance of the so-called political leadership implemented by the Bank since July 2014 on terminating new operations in our country with the EBRD statutory documents and procedures was one of the key items of the agenda introduced by Russia.

As a matter of fact, this independent multilateral development institution has joined in the sanctions pressure on Russia under politically biased pretexts. To be sure, this was done in the toughest form possible, in which the restrictions were imposed not on individual economic sectors or institutions, but rather were applied to all new EBRD operations in Russia.

Our attempts to resolve the situation through an open dialogue during almost three years did not yield any results. No one heard us. As a result, the Russian side was forced to submit a draft resolution on the illegitimacy of restricting Russia's access to EBRD resources for consideration by the Bank's supreme management body, demanded the abolition of the so-called political leadership and provided, to substantiate its claims, a detailed legal analysis of violations of the Bank's constituent documents when it was adopted and implemented, which was put together using, among other things, the expertise of independent European lawyers.

Our goal was not to raise the issue of "lifting the sanctions." We, as is well known, do not discuss this issue with anyone. Lifting the sanctions is up to those who imposed them. However we, as a major shareholder and the most profitable country of operations, are concerned about the fate of the EBRD, which, through the fault of a number of short-sighted Western shareholders, can simply "go downhill."

Speaking at a meeting of the Board of the Governors, Russian Minister of Economic Development Maksim Oreshkin drew the attention of the participants to the Bank's deteriorating financial situation and prospects related to the emergence of a number of negative trends and managerial setbacks hidden behind their generally upbeat reports. In fact, he provided an exhaustive and reasoned analysis of the current state of affairs at the Bank, indicating that persisting with the current approach, especially in the context of continued blocking of the Bank's operations in Russia, which deprives the Bank of the most lucrative operations, makes the EBRD's financial position unsustainable. This may lead to lower credit ratings and, in the future, may require additional capitalisation of the Bank.

Our concerns were met with understanding by many EBRD members. However, the shareholders of the EU and G7 countries blocked Russia's resolution, supporting instead the Bank's proposal that the political leadership, with regard to Russia, does not contradict its rules and procedures. Thus, the EBRD members recognised as "lawful" the discriminatory policy within this international financial organisation against one of its bona fide members for political reasons, and the Bank's management, having offered such a decision, lost its neutral status. Once again, fleeting political interests were placed above the principles of sound financial cooperation and international economic interests, thus turning the EBRD from a development institution into a tool of political pressure.

The Western shareholders' vote against the first item of our proposals – that the rights of the Bank's members cannot be limited except when provided for by its statutory documents – deserve a special mention. This can only be described as the ultimate political cynicism. In fact, the donors admitted that they had been using the bank for political purposes in circumvention of all rules and procedures.

It should be noted, however, that the Bank's management was at some point willing to resume non-financial cooperation with Russia, given its role as a significant shareholder and country of operations. This could include the EBRD's consulting services in the areas of public-private partnerships, small business, export support and a number of other areas. However, the Western shareholders opposed the idea of resuming even such minimal interaction, which, by the way, does not contradict their own concept of political leadership. Once again, we are forced to state with regret that our Western partners were unable to demonstrate not only political foresight, but basic sound economic judgement either.

As a result, the EBRD is the only loser: its image suffered significant damage, and its financial performance and the quality of its loan portfolio should become the subject of a thorough analysis by international rating agencies.

The state of our relations with the EBRD once again confirms the correctness of Russia's choice in favour of stepping up interaction with new players on the international lending and financial market, in particular, the Asian Infrastructure Investment Bank and the New Development Bank of BRICS.

India
Source: thebricspost.com

Russia's BRICS partner, Indian Prime Minister Narendra Modi will attend the St Petersburg International Economic Forum to be held on June 1-3, Kremlin spokesperson Dmitry Peskov said on Friday.

SPIEF is an annual Kremlin-run, high-profile gathering of business and political figures.

Modi's visit to Russia comes amid a continuing storm over US intelligence agencies' allegations that Russia tried to interfere in the US presidential election to help Donald Trump win the White House.

Relations between Moscow and the European Union have also been strained since an EU move to bring Ukraine into a trade pact. The EU imposed sanctions on Russia after Moscow, in 2014, held and won a referendum in Crimea, that was earlier part of Ukraine.

The EU is currently holding a heated debate on whether to extend sanctions against Moscow, which will expire this summer.

India had earlier backed what it describes as "legitimate Russian interests in Ukraine" after Russian accession of Crimea that resulted in Western sanctions against the country.

Indian Prime Minister Modi will hold talks with Putin during his Russia visit.

In 2015, Indian Prime Minister Modi also praised Putin's leadership that tackled what he called "the confrontation against Russia".

"Despite the various global problems, despite the confrontation against Russia, you have raised your country, your state to a qualitatively new level. Russia proudly moves along its own development path and I commend your personal leadership in this process," Modi told Putin.

Delhi and Moscow have close economic and political ties.

India has announced plans to build 40 nuclear reactors, in addition to the existing 22, in the next two decades. Russia is planning to build 20 reactors in India. Russian state nuclear company Rosatom would look at "localization of manufacturing in India for Russian-designed nuclear reactor units" according to the Indian Ministry of External Affairs.

Almost ninety per cent of India's military arsenal is Russian equipment. In the past couple of years, the US is playing catch up trying to displace Russia from the top spot.

Modi and Putin will also meet in China later this year during the 9th BRICS Summit.

China
Source: infobrics.org

Ninth BRICS Academic Forum and BTTC meeting would be held during June 10-13 in Fuzhou, capital city of Fujian Province.

The theme of the forum is "Pooling Wisdom and New Ideas for Cooperation".

The subtheme would cover BRICS cooperation in the area of Finance, Trade, Global Governance, People to People Exchanges, Sustainable Development, Innovation, BRICS Mechanism Building and Deepening Partnership.

China
Source: infobrics.org

China's President Xi Jinping will meet his Russian counterpart Vladimir Putin next week on the sidelines of Beijing's flagship One Belt One Road summit in Beijing.

This would be Xi and Putin's first meeting this year. The two leaders will also hold talks during Xi's upcoming visit to Russia in the first week of July.

The allies, who are permanent members of the UNSC, are due to stress their unity in dealing with hot spots like North Korea and Syria.

Earlier last year, Chinese President Xi said he hoped Russia and China might remain "friends forever".

"President Putin and I equally agree that when faced with international circumstances that are increasingly complex and changing, we must persist even harder in maintaining the spirit of the Sino-Russian strategic partnership and cooperation," Xi said.

Russia's trade turnover with China is almost thrice as big as that with the US.

In Beijing, Xi and Putin will also discuss the upcoming BRICS summit. The 9th BRICS Summit is scheduled to be held in the resort city of Xiamen in east China's Fujian Province in September.

Later on, the Russian and Chinese presidents will meet at an Asia-Pacific Economic Cooperation (APEC) summit in Vietnam.

Beijing will host the Belt and Road forum on May 14-15. The forum is expected to bring together top officials from 28 countries, as well as UN Secretary General Antonio Guterres, IMF chief Christine Lagarde, and World Bank President Jim Yong Kim.

"China has invested more than 50 billion U.S. dollars in countries along the Belt and Road since proposing the initiative in 2013," He Lifeng, head of the National Development and Reform Commission, said in early March.

China's One Belt, One Road initiative aims to create a modern Silk Road Economic Belt and a 21st Century Maritime Silk Road to boost trade and extend its global influence. The ancient Silk Road connected China and Europe from around 100 B.C.

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