BELT AND ROAD WORK IN PROGRESS

China has set up a US$ 40 billion Silk Road Fund (SRF) to fund infrastructure and
resources, as well as technological and financial collaboration. The aim of the SRF
is to be operated as a sovereign wealth fund (SWF), which is capitalized using the
foreign reserves of China. The plan is expected to bring additional resources to
state-owned lenders, regional development agencies and stakeholders. Thanks to
Brazil, Russia, India, China and South Africa (BRICS), the Asian Infrastructure
Investment Bank (AIIB) and the New Development Bank (NDB) were able to
mobilize funds for infrastructure and sustainable development initiatives. With
China as the major contributor to AIIB, many local investors (e.g., Australia,
Russia, South Korea, India, Indonesia, Turkey, Saudi Arabia) and non-regional
stakeholders (e.g., Argentina, South Africa, the United Kingdom, Germany,
France, Italy, Spain) donated to AIIB and thus received implicit support for the
initiative. OBOR allocation will be much more than the SRF in any event. For
instance, it is estimated that the China–Pakistan Economic Corridor itself will cost
US$ 75 billion, of which about US$ 45 billion will be needed to make the corridor
functional by 2020. However, Chinese state-owned banks will provide additional
resources as loans to countries implementing OBOR ventures. Within an
unspecified time period, China is projected to spend US$ 4 trillion in OBOR
countries.

The OBOR plan offers new ways to invest the valuable trade deficit of China to
invest in US treasury bonds. China has already signed Memoranda of
Understanding (MOUs) with more than 30 countries working on the grand project
and received positive feedback from many other countries. In addition, MoUs were
also signed between Chinese banks and countries funding OBOR national
government agencies. Additional resources can be given by the SWFs, particularly
from China. The Renminbi's recognition as a global reserve currency will bring
China's international initiatives such as OBOR more impetus. By September 2015,
19 projects had been authorized by the National Development and Reform
Commission (NDRC). Such works support the OBOR policy and include the
development of expressway links through the regions, highways and shipping
routes of China. Provinces such as Anhui, Inner Mongolia and Xinjiang are
connected by expressways. A freight train connecting the New Eurasia Land
Bridge has already been built, going via Xi'an, Urumqi and Alataw Pass all the
way to Almaty in Kazakhstan, shortening the freight delivery time from Anhui to
Central Asia (HKTDC 2015). Railway ventures signed following OBOR's
announcement include China–Thailand Railway from China Railway Construction
Corporation (CRCC), China–Uzbekistan–Kyrgyzstan Railway from CRBC, and
China North Industries Corporation (NORINCO) Light Railway in Iran. A variety
of networking initiatives (road, rail, air) have already been connected to the
OBOR.