EXPLORING THE BELT AND ROAD INITIATIVE: ECONOMIC SHIFTS AND GEOPOLITICAL IMPLICATIONS IN THE MENA REGION

Abstract

The economic environment of the world is changing drastically, with the Belt and Road Initiative (BRI) by China being the largest-scale infrastructure endeavor in recent history. China aims at developing its economy, as well as increasing its geopolitical presence in the world through massive investments in infrastructure, trade and development initiatives. One of the centers of this strategic drive is the North Africa and Middle East (MENA) region which is endowed with natural resources. Although the region supplies only 5% of the global GDP, 45% of the world natural gas reserves and 60% of the oil reserves are found in the MENA region. This renders it a crucial ingredient of long-term strategic and economic goals of China. Uniqueness of geopolitics in MENA region and the large natural resource base make implementation of BRI in the region different compared to other projects across the world. This paper takes a qualitative methodology using a contextual analysis framework to examine the economic, structural, and geopolitical consequences of BRI initiatives in the MENA region. It looks at how these infrastructure projects are transforming the economic and political landscape of MENA with issues like debt sustainability, governance, and local socio-political implication being the main concern. The results indicate that, even though the BRI has helped in the development of infrastructure, it has also caused issues regarding the sustainability of debt in the long run, the issue of local governance and the possibility of unequal power relations. In addition, more balanced and fairer win-win partnerships between China and the MENA countries are on the rise. On this basis, the paper provides policy suggestions that China can adopt to get the balance right to form more win-win relationships. These suggestions are geared towards making the BRI stable, sustainable and long term successful in the MENA region so that both China and the MENA countries can realize significant benefits.