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A Heng Wang (2018) China's Approach To The Belt and Road Initiative: Scope, Character and Sustainability
A Heng Wang (2018) China's Approach To The Belt and Road Initiative: Scope, Character and Sustainability
doi: 10.1093/jiel/jgy048
Advance Access Publication Date:
∗ Associate Professor and Co-Director of Herbert Smith Freehills China International Business and Eco-
nomic Law (CIBEL) Centre, Faculty of Law, the University of New South Wales, Sydney; Univer-
sity Visiting Professorial Fellow, Southwest University of Political Science and Law (SWUPL). Email:
heng.wang1@unsw.edu.au.
I am grateful to the Editors-in-Chief, anonymous reviewers, Tomer Broude, Markus Wagner, Shen Wei,
Mark Feldman, David A. Gantz, Locknie Hsu, Pasha L. Hsieh, Yip Man, Bin Gu, Donald Lewis, Jingxia
Shi, Manjiao Chi, Peter K. Yu, Rosalind Dixon, Bronwen Morgan, Daniel Joyce, Simon Lester, Giuseppe
Martinico, Julien Chaisse, Qingjiang Kong, Congyan Cai, Tong Qi, and participants at the 2017 Tsinghua-
UNSW Workshop, Oxford University One Belt One Road Summit, the conference “The Emergence of
New and Dynamic China-Africa Economic Relationships,” my lectures at SWUPL, and China University of
Political Science and Law for their insightful comments, and to Melissa Vogt, Hamish Collings-Begg, and
Talina Hurzeler for excellent assistance and comments. All errors are my own.
© The Author(s) 2018. Published by Oxford University Press. All rights reserved.
For Permissions, please email: journals.permissions@oup.com
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2 • China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability
INTRODUCTION
As ‘the most ambitious geo-economic vision in recent history’, the Belt and Road Initia-
1 Jonathan Hillman, ‘China’s Belt and Road Initiative: Five Years Later’ (2018), available at https://csis-prod.
s3.amazonaws.com/s3fs-public/publication/ts180125_hillman_testimony.pdf?mSTOaqZbgZdRpx4QWo
St1HtIa4f N42uX.
2 Weifeng Zhou and Mario Esteban, ‘Beyond Balancing: China’s Approach Towards the Belt and Road Initia-
tive’, 27 Journal of Contemporary China 487 (2018), at 487 and 496.
3 Robert O. Keohane, ‘Multilateralism: An Agenda for Research’, 45 International Journal 731 (1990), at 731.
4 It seems that current research often addresses investment treaty issues concerning the BRI. See, e.g., Shu
Zhang, ‘China’s Approach in Drafting the Investor–State Arbitration Clause: A Review from the “Belt and
Road” Regions’ Perspective’, 5 The Chinese Journal of Comparative, (2017) at 79–109, Vivienne Bath, ‘“One
Belt, One Road” and Chinese Investment’, in Chao Xi and Lutz-Christian Wolff (eds), Legal Dimensions of
China’s Belt and Road Initiative (Hong Kong: Wolters Kluwer Hong Kong Limited, 2016), 165–218.
5 For the most recent research, see, e.g., Zhou and Esteban, above n 2, at 487–501; Yong Wang, ‘Offensive for
Defensive: The Belt and Road Initiative and China’s New Grand Strategy’, 29 The Pacific Review 455 (2016),
at 455–463.
China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability • 3
These three qualities reveal the major legal characteristic behind China’s BRI
approach, which is to maximize flexibility in addressing uncertainties and challenges
6 The term ‘rigid’ is not necessarily the same as formal hard law. Rigidness implies that norms have some kind of
compliance pull or coerciveness. See, e.g., Chris Brummer, ‘Why Soft Law Dominates International Finance—
and not Trade’, 13 Journal of International Economic Law 623 (2010), at 623–643.
7 Other countries have participated in the shaping of the BRI. That said, the BRI is led by China, and it appears
that the BRI is largely shaped by China, particularly from the BRI-wide perspective. This is because China, as
the hub of the BRI system, is the only country that links with all other BRI countries to develop the BRI plan.
4 • China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability
8 A similar functional approach has been proposed in other areas including consitutional law. See, e.g.,
Rosalind Dixon, ‘The Functional Constitution: Re-reading the 2014 High Court Constitutional Term’, 43
Federal Law Review 455 (2015), at 456 (Courts should rely on substantive values of consitutional law than
more formal legal source); Felix S. Cohen, ‘Transcendental Nonsense and the Functional Approach’, 35
Columbia Law Review 809 (1935), at 809–849; Gabrielle J. Appleby, ‘Imperfection and Inconvenience:
Boilermakers’ and the Separation of Judicial Power in Australia Worst Top Court Decisions of the Last
Quarter Century’, 31 University of Queensland Law Journal 265 (2012), at 265–286.
9 Dixon, above n 8, at 456.
10 Ibid, at 459.
11 Cohen, above n 8, at 822.
12 For an analysis of RCEP and China, see, e.g., Heng Wang, ‘The RCEP and Its Investment Rules: Learning
from Past Chinese FTAs’, 3 The Chinese Journal of Global Governance 160 (2017), at 160–181.
13 G20 Guiding Principles for Global Investment Policymaking (2016), available at http://www.oecd.org/daf/
inv/investment-policy/G20-Guiding-Principles-for-Global-Investment-Policymaking.pdf.
14 Peter K. Yu, ‘Sinic Trade Agreements’, 44 UC Davis Law Review 953 (2011), at 1009.
15 The second BRF will be held in China in 2019.
China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability • 5
and perhaps gradually shape its agenda. Judging from the cooperation objectives of the
BRF Joint Communique, the purposes of the BRI seem to mainly include international
16 ‘Joint Communique of the Leaders Roundtable of the Belt and Road Forum for International Cooperation’
(2017), available at http://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1462012.shtml, paras 8-13.
17 Ibid, at para 15.
18 ‘One Belt One Road, FTZ Plans Go Hand in Hand’, Global Times, 25 February 2015, available at
http://www.globaltimes.cn/content/908837.shtml.
19 Justin Yifu Lin, ‘“One Belt and One Road” and Free Trade Zones—China’s New Opening-up Initiatives’, 10
Frontiers of Economics in China 585 (2015), at 590.
20 Chen Yin, ‘Chinese FTZs and Their Contributions to BRI’ (2017), http://www.rksi.org/sites/
default/files/document/911/sez-2017-c-yin-chinese-ftzs-and-their-contributions-bri.pdf.
21 Ibid.
22 Jiaxiang Hu and Jie ( Jeanne) Huang, ‘Dispute Resolution Mechanisms and Organizations in the Implemen-
tation of “One Belt, One Road” Initiative: Whence and Whither’, 52 Journal of World Trade 815 (2018), at
834.
6 • China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability
(RMB) internationalization, and FTZs are all part of the BRI approach, as they work
together to promote the BRI.
23 Jiangyu Wang, ‘International Economic Law and Asia’, in Simon Chesterman, Hisashi Owada and Ben
Saul (eds), Oxford Handbook of International Law in Asia and the Pacific (Oxford University Press,
Oxford, 2019 Forthcoming); NUS Law Working Paper No. 2018/026, available at https://ssrn.com/
abstract=3204016, at 17.
24 National Development and Reform Commission & the State Oceanic Administration, ‘Vision for Mar-
itime Cooperation under the Belt and Road Initiative’ (2017), available at https://www.yidaiyilu.gov.cn/
wcm.files/upload/CMSydylgw/201706/201706200153032.pdf, Part V.
25 Tomas Casas i Klett and Omar Ramon Serrano Oswald, ‘Free Trade Agreements as BRI’s Stepping-Stone to
Multilateralism: Is the Sino–Swiss FTA the Gold Standard?’, in Wenxian Zhang et al. (eds), China’s Belt and
Road Initiative: Changing the Rules of Globalization (Cham, Switzerland: Palgrave Macmillan, 2018), 76.
26 Christoph Lattemann et al., ‘Final Reflections’, see ibid, 341.
27 Fan Zhang et al., ‘The Effect of RMB Internationalization on Belt and Road Initiative: Evidence from Bilateral
Swap Agreements’, 53 Emerging Markets Finance & Trade 2845 (2017), at 2845.
28 Je˛drzej Górski, ‘China’s Strategy Toward Central and Eastern Europe Within the Framework of 16 + 1
Group: The Case of Poland’, in Wenxian Zhang et al. (eds), China’s Belt and Road Initiative: Changing the
Rules of Globalization (Cham, Switzerland: Palgrave Macmillan, 2018), 117.
29 Governing Council of China (Shanghai) Pilot Free Trade Zone, Opinions of China (Shanghai) Pilot
Free Trade Zone on the Expansion of Financial Service Industry Opening-Up and the Further
Formation of New Advantages from Development and Liberalisation (21 June 2018), available at
http://iftzr.sysu.edu.cn/node/16472, Articles 5, 14.
30 Weitseng Chen, ‘Lost in Internationalization: Rise of the Renminbi, Macroprudential Policy, and Global
Impacts’, 21 Journal of International Economic Law 31 (2018), at 41; Hal S. Scott and Anna Gelpern,
International Finance: Transactions, Policy, and Regulation, 21st ed. (St. Paul, Minnesota: Foundation Press,
2016), 1404, 1405.
31 Chris Brummer, Renminbi Ascending: How China’s Currency Impacts Global Markets, Foreign Policy, and
Transatlantic Financial Regulation (Washington, DC: Atlantic Council, 2015), 17.
China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability • 7
That said, the functional approach is not without challenges,32 as the actual effects of
the abovementioned measures on the BRI remain to be seen. For example, the above-
32 Peter Anastasius Gerangelos, ‘The Separation of Powers and Legislative Interference with Judi-
cial Functions: A Comparative Analysis’ (2004), available at http://classic.austlii.edu.au/au/journals/
UNSWLawTD/2004/2.pdf , at 57.
33 Bin Sheng, ‘How to Develop the Upgraded Free Trade Zones?’, Shanghai Securities News, 28 March 2017,
available at http://news.cnstock.com/paper,2017-03-28,796736.htm.
34 William H. Overholt, ‘One Belt, One Road, One Pivot’, 26 September 2015, available at
http://theoverholtgroup.com/media/Article-Southeast-Asia/One-Belt-One-Road-One-Pivot-Global-
Asia-Corrected-Oct2015.pdf.
35 HKTDC, ‘The Belt and Road Initiative’, 13 September 2017, available at http://china-trade-
research.hktdc.com/business-news/article/The-Belt-and-Road-Initiative/The-Belt-and-Road-Initiative/
obor/en/1/1X000000/1X0A36B7.htm.
36 Shuaihua Cheng, ‘China’s New Silk Road: Implications for the US’, 2015, available at
http://e15initiative.org/blogs/chinas-new-silk-road-implications-for-the-us/.
37 For the analysis of G16+1, see, e.g., Górski, above n 28, at 115–134.
8 • China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability
The BRI can be seen as a loosely connected network of new or existing bilateral
and multilateral mechanisms,38 based on ‘a series of unrelated but nonetheless inter-
38 National Development and Reform Commission et al., ‘Full text: Action Plan on the Belt and
Road Initiative’ (2015) , available at http://english.gov.cn/archive/publications/2015/03/30/content_
281475080249035.htm, Part V.
39 Wade Shepard, ‘Why the Ambiguity of China’s Belt and Road Initiative Is Perhaps Its Biggest Strength’,
Forbes, 19 October 2017, available at https://www.forbes.com/sites/wadeshepard/2017/10/19/what-
chinas-belt-and-road-initiative-is-really-all-about/#49dc2a4be4de.
40 Rochelle Cooper Dreyfuss, Harmonization: Top down, Bottom Up — And Now Sideways? The Impact
of the IP Provisions of Megaregional Agreements on Third Party States (March 1, 2018) in Megaregulation
Contested: Global Economic Ordering After TPP (Benedict Kingsbury, et al., eds., Oxford University Press,
Forthcoming); NYU School of Law, Public Law Research Paper No. 17-21; NYU Law and Economics
Research Paper No. 17-17, available at SSRN: https://ssrn.com/abstract=2995756, p. 4.
41 Xinhua, ‘Xi Eyes More Enabling Int’l Environment for China’s Peaceful Development’, Global Times,
30 November , available at http://www.globaltimes.cn/content/894240.shtml; Xinhua, ‘Belt and Road
Forum Agenda Set’, China Daily, 18 April 2017, available at http://europe.chinadaily.com.cn/china/2017-
04/18/content_28982925.htm.
42 Tommi Yu, ‘China’s “One Belt, One Road Initiative”: What’s in It for Law Firms and Lawyers?’, 5 The Chinese
Journal of Comparative Law 1 (2017), at 2.
China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability • 9
the first time, regarded as one of the ‘regional development initiatives’.47 Efforts are being
made to possibly upload BRI principles to international law. China put forward the
47 ‘Security Council Authorizes Year-Long Mandate Extension for United Nations Assistance Mission
in Afghanistan, Adopting Resolution 2344 (2017)’, available at https://www.un.org/press/
en/2017/sc12756.doc.htm (para 34 of Resolution 2344 ‘Welcomes and urges further efforts to strengthen
the process of regional economic cooperation, including measures to facilitate regional connectivity,
trade and transit, including through regional development initiatives such as the Silk Road Economic Belt
and the 21st-Century Maritime Silk Road (the Belt and Road) Initiative ... ’).
48 ‘Foreign Ministry Spokesperson Geng Shuang’s Regular Press Conference on September 13, 2017’, 2017,
available at https://www.fmprc.gov.cn/ce/cgct/eng/fyrth/t1492681.htm.
49 National Development and Reform Commission et al., above n 38, Part V.
50 Basil C. Bitas, ‘ASEAN’, in Guiguo Wang et al. (eds), Essentials of the Laws of the Belt and Road Countries: EU,
ASEAN (Hangzhou, China: Zhejiang University Press, 2017), 152.
51 China.org.cn, ‘Full text: List of Deliverables of the Belt and Road Forum for International Cooperation, 7
June 2017’, available at http://www.china.org.cn/chinese/2017-06/07/content_40983146.htm (the Belt
and Road Forum for International Cooperation is to be held regularly).
52 Alice Ekman, ‘China’s New Silk Roads: A Flexible Implementation Process’, in Alice Ekman et al., Three
Years of China’s New Silk Roads: From Words to (Re)action? (Paris, France: Institut français des relations
internationales, February 2017), 15.
53 ‘Ministry of Foreign Affairs Holds Briefing for Chinese and Foreign Media on President Xi
Jinping’s Attendance and Chairing of Related Events of the BRF’, 18 April 2017, available at
http://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1455115.shtml, (During the BRF, it is expected
that ‘China will negotiate and sign cooperation documents with nearly 20 countries and over 20
international organizations’).
54 Ekman, above n 52, 13.
China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability • 11
as one BRF outcome, which will reportedly work to ‘establish a liaison mechanism,
. . . an information sharing platform, as well as a regional financial idea exchange
55 Li Xiang, ‘Asian Financial Cooperation Association Launched in Beijing’, 24 July 2017, available at
https://news.cgtn.com/news/3d67444e796b444e/share_p.html.
56 At the time of writing, there are 18 BRI-related guiding cases, and the number is likely to increase; Stanford
Law School China Guiding Cases Project, ‘B&R Cases Archive—China Guiding Cases Project’, available at
https://cgc.law.stanford.edu/belt-and-road/b-and-r-cases/?page=1.
57 ‘Several Opinions of the Supreme People’s Court on Providing Judicial Services and Safeguards
for the Construction of the ‘Belt and Road’ by People’s Courts’ (2015), available at http://lwww.
lawinfochina.com.wwwproxy1.ibrary.unsw.edu.au/display.aspx?id=22512&lib=law&SearchKeyword=
Providing%20Judicial%20Services%20and%20Safeguards%20for%20the%20Construction%20of%20the
%20%A1%B0Belt%20and%20Road%A1%B1&SearchCKeyword=#.
58 ‘China is to establish International Development Cooperation Agency’, 16 March 2018, available at
http://fj.china-embassy.org/chn/zt/lh5555/t1542878.htm.
59 Xinhua, ‘China customs pushes int’l rules on cross-border e-commerce’, 1 December 2018, available at
http://www.xinhuanet.com/english/2018-01/12/c_136891181.htm.
60 Given space limits, it is not possible to analyse the national law of the large number of BRI states.
12 • China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability
is difficult to list all of them, these documents and rules can be classified under two
categories (as indicated in Table 3, although the examples here do not exhaust all BRI
61 ‘Statement of the Co-Chairs of the Forum on the Belt and Road Legal Cooperation’ (2018), available at
http://aoc.ouc.edu.cn/26/72/c9828a206450/page.htm, para 17.
62 ‘China–Arab States Cooperation Action Declaration on the Belt and Road’ (2018), available at
http://www.chinaarabcf.org/chn/zagx/gjydyl/t1577010.htm.
China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability • 13
63 For many BRI-specific documents, see, HKTDC, ‘The Belt and Road Initiative: Implementation
Plans and Co-operation Agreements’, 27 August 2018, available at http://china-trade-research.hktdc.
com/business-news/article/The-Belt-and-Road-Initiative/The-Belt-and-Road-Initiative-Implementation-
Plans-and-Co-operation-Agreements/obor/en/1/1X000000/1X0A3857.htm.
64 ‘Plan of Action to Implement the Joint Declaration on ASEAN-China Strategic Partnership for Peace
and Prosperity (2016–2020)’, available at https://www.asean.org/storage/images/2015/November/27th-
summit/ASEAN-China%20POA%20%202016-2020.pdf, Article 4.4.
65 ‘China–Arab States Cooperation Action Declaration on the Belt and Road (2018)’, available at
http://www.chinaarabcf.org/chn/zagx/gjydyl/t1577010.htm, para 17 (the respect for the purposes and
principles of the Charter of the United Nations and international law).
66 Andrew T. Guzman and Timothy L. Meyer, ‘International Soft Law’, 2 Journal of Legal Analysis 171 (2010),
at 172.
67 Dinah L. Shelton, ‘Soft Law’, available at https://scholarship.law.gwu.edu/cgi/viewcontent.cgi?article=2048
&context=faculty_publications, at 3.
68 Vivienne Bath, ‘The South and Alternative Models of Trade and Investment Regulation: Chinese Investment
and Approaches to International Investment Agreements’, in Fabio Morosini and Michelle Ratton Sanchez
Badin (eds), Reconceptualizing International Investment Law from the Global South (New York: Cambridge
University Press, 2017), 80.
14 • China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability
69 Bitas, above n 50, at 171–178 (for instance, the Memoranda of Understanding for Implementation of the
Chongqing Connectivity Initiative).
70 These international organizations include the United Nations Development Programme, the United Nations
Industrial Development Organization, the United Nations Human Settlements Programme, the United
Nations International Children’s Fund, the United Nations Population Fund, the United Nations Conference
on Trade and Development, the World Health Organization, WIPO, and the International Criminal Police
Organization; China.org.cn, above n 51, Part I .2.
71 These international organizations include the United Nations Economic Commission for Europe, the
World Economic Forum, the International Road Transport Union, the International Trade Center, the
International Telecommunication Union, the International Civil Aviation Organization, the United Nations
Alliance of Civilizations, the International Development Law Organization, the World Meteorological
Organization, and the International Maritime Organization; Ibid, at Part I.4.
72 Michael M. Du, ‘China’s “One Belt, One Road” Initiative: Context, Focus, Institutions, and Implications’, 2
The Chinese Journal of Global Governance 30 (2016), at 40.
73 James Laurenceson, Simone van Nieuwenhuizen, and Elena Collinson, ‘Decision Time: Australia’s
Engagement with China’s Belt and Road Initiative’, available at http://www.australiachinarelations.org/
sites/default/files/20171109%20ACRI%20Research_Decision%20Time_Australia%27s%20engagement
%20with%20China%27s%20Belt%20and%20Road%20Initiative.pdf, at 9.
74 Filippo M. Zerilli, ‘The Rule of Soft Law: An Introduction’, 56 Focaal—Journal of Global and Historical
Anthropology 3 (2010), at 5.
75 fmprc.gov.cn, ‘Transcript of Vice Foreign Minister Le Yucheng’s exclusive interview with the Finan-
cial Times’, China Daily, 26 September 2018, available at http://usa.chinadaily.com.cn/a/201809/
26/WS5bab2f67a310c4cc775e8304.html.
China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability • 15
the BRI, since the BRI relies upon multilateral mechanisms in its global governance.76
WTO norms overall benefit China as a major goods exporting country through, inter
76 Lingliang Zeng, ‘Conceptual Analysis of China’s Belt and Road Initiative: A Road towards a Regional
Community of Common Destiny’, 15 Chinese Journal of International Law 517 (2016), at 541.
77 Klett and Oswald, above n 25, at 79.
78 Shepard, above n 39.
79 Given the different definitions of soft law, it is perhaps more accurate to use the term ‘non-treaty-based
approach’.
80 Barbara Koremenos et al., ‘The Rational Design of International Institutions’, 55 International Organization
761 (2001), at 773.
16 • China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability
distribution problem, and with the number of players involved.81 For the first two
conjectures, the BRI projects have distributional effects (such as possible economic
81 Ibid, at 793–795.
82 Bradley Parks, ‘Will Chinese Development Projects Pave the Way to Inclusive Growth?’, 11 September
2018, available at https://www.brookings.edu/blog/future-development/2018/09/11/will-chinese-
development-projects-pave-the-way-to-inclusive-growth/.
83 Brummer, above n 6, at 624.
84 Jamil Anderlini, ‘Interview: “We Say, If You Want to Get Rich, Build Roads First”’, The Financial Times, 26
September 2018, available at https://www.ft.com/content/4ec28916-9c9b-11e8-88de-49c908b1f264.
85 Jingxia Shi, ‘The Belt and Road Initiative and International Law: An International Public Goods Perspective’,
in Yun Zhao (ed.), International Governance and the Rule of Law in China under the Belt and Road Initiative
(Cambridge: Cambridge University Press, 2018), 30.
86 Wade Shepard, ‘China’s Challenges Abroad: Why the Belt & Road Initiative Will Succeed’, Forbes, 17 October
2017, available at https://www.forbes.com/sites/wadeshepard/2017/10/17/chinas-challenges-abroad-5-
reasons-why-the-belt-road-will-succeed/#34972eba4a82.
87 Laurence R. Helfer, ‘Flexibility in International Agreements’, in Jeffrey L. Dunoff and Mark A. Pollack (eds),
Interdisciplinary Perspectives on International Law and International Relations: The State of the Art (New York:
Cambridge University Press, 2012), 179.
China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability • 17
statements of cooperation rather than standards and best practices and lack various
complex enforcement technologies that would render it more coercive.88 As an illustra-
88 Chris Brummer, Soft Law and the Global Financial System: Rule Making in the 21st Century (Cambridge
University Press, 2011), 5.
89 For soft international financial law, see Brummer, above n 6, at 628–630.
90 Brummer, above n 88, at 147–156.
91 Brummer, above n 6, at 624.
92 Brummer, above n 88, at 136.
93 See, e.g., China.org.cn, above n 51.
94 Górski, above n 28, at 117.
95 Samuli Seppänen, ‘Performative Uses of Sovereignty in the Belt and Road Initiative’, in Yun Zhao (ed.),
International Governance and the Rule of Law in China under the Belt and Road Initiative (Cambridge:
Cambridge University Press, 2017), 25.
18 • China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability
96 Marlene Laruelle, ‘Introduction. China’s Belt and Road Initiative. Quo Vadis?’, in Marlene Laruelle (ed),
China’s Belt and Road Initiative and Its Impact in Central Asia (Washington, D.C.: The George Washington
University, Central Asia Program, 2018), xii.
97 Lattemann et al., above n 26, at 342.
98 Ernst-Ulrich Petersmann, ‘Trade and Investment Adjudication Involving “Silk Road
Projects”: Legal Methodology Challenges’, EUI Working Paper LAW 2018/02, available at
http://cadmus.eui.eu/bitstream/handle/1814/51225/LAW_2018_02.pdf?sequence=1, at 15.
99 Donald J. Lewis and Diana Moise, ‘OBOR Roadmaps: The Legal and Policy Frameworks’, Transnational
Dispute Management 3 (2017), at 10–11.
100 Gisela Grieger, ‘China’s WTO Accession: 15 Years on Taking, Shaking or Shaping WTO Rules?’,
December 2016, available at http://www.europarl.europa.eu/RegData/etudes/BRIE/2016/593570/
EPRS_BRI (2016)593570 EN.pdf , at 1.
101 ‘First Global Cross-Border E-Commerce Conference Beijing Declaration’ (2018), available
at http://www.wcoomd.org/-/media/wco/public/global/pdf/about-us/legal-instruments/declarations/
beijing-declaration-1022018.pdf?db=web.
102 Zhou and Esteban, above n 2, at 488.
China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability • 19
China’s previous approach of ‘hide brightness and nourish obscurity’,103 and its role
as a participant rather than a leader in multilateral and megaregional negotiations
103 Simon Chesterman, ‘Asia’s Ambivalence about International Law and Institutions: Past, Present and
Futures’, 27 European Journal of International Law 945 (2016), at 967.
104 Chinese government ‘firmly supports Asean’s core leading role’ in the RCEP negotiations. See, ‘Beijing
“Firmly Supports” Asean’s Core Role in RCEP Negotiations,’ The Straits Times, 31 January 2018, available
at http://www.straitstimes.com/asia/beijing-firmly-supports-aseans-core-role-in-rcep-negotiations.
105 Alice D. Ba, ‘TPP, OBOR and ASEAN: Where Will They Lead To?’, 11 May 2018, available at
http://www.rsis.edu.sg/wp-content/uploads/2016/05/CO16108.pdf.
106 Wei Shen, ‘The Belt and Road Initiative, Expropriation and Investor Protection under BITs’, in Yun Zhao
(ed.), International Governance and the Rule of Law in China under the Belt and Road Initiative (Cambridge:
Cambridge University Press, 2018), 135.
107 US–Mexico–Canada Agreement (USMCA), Article 30.1.
108 Ibid, at Article 34.7.4.
20 • China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability
2. Norms
In respect of norms, the US takes an increasingly stringent and less flexible approach in
comparison with China’s maximised flexibility. The latest US trade approach generally
employs new and stringent rules. By comparison, China’s approach utilizes market
openings and frequently uses soft law, with heavy reliance on general statements. In
this regard, soft law is not seen as mainstream in US trade practice, although it has
been employed in regards to certain sensitive issues (e.g., the Joint Declaration of the
Macroeconomic Policy Authorities of Trans-Pacific Partnership Countries).
US-style trade pacts seem to reduce treaty flexibility, due to their highly specified
nature in relation to various aspects, ranging from treaty withdrawal provisions (the
USMCA and Trans-Pacific Partnership (TPP) specify that a withdrawal takes effect six
months after the written withdrawal notice112 ), to labour clauses (the USMCA includes
clarification footnotes to respond to the US–Guatemala labour case panel report113 ). For
future US FTAs under the Trump administration, their flexibility will be limited as the
USMCA will be a template for these trade pacts.114 As such, in relation to engagements
with norms, the US has taken a divergent approach from that of China and the BRI.
109 USTR, ‘United States–Mexico Trade Fact Sheet: Modernizing NAFTA into a 21st Century
Trade Agreement’ (2018), available at https://ustr.gov/about-us/policy-offices/press-office/fact-
sheets/2018/august/united-states–mexico-trade-fact-sheet-1.
110 ‘Greening the Belt and Road Initiative: WWF’s Recommendations for the Finance Sector’ (2018), available
at http://www.sustainablefinance.hsbc.com/our-reports/greening-the-belt-and-road-initiative, at 8.
111 USMCA, Article 32.10.
112 Simon Lester, ‘The U.S.–Mexico–Canada (AKA the New NAFTA) Trade Deal: Withdrawing from the New
NAFTA’ (2018), available at http://worldtradelaw.typepad.com/ielpblog/2018/10/withdrawing-from-
the-new-nafta.html.
113 Kathleen Claussen, ‘Guest Post: The U.S.-Mexico-Canada (AKA the New NAFTA) Trade Deal:
Labor’ (2018), available at http://worldtradelaw.typepad.com/ielpblog/2018/10/guest-post-the-us-
mexico-canada-aka-the-new-nafta-trade-deal-labor.html.
114 ‘Remarks by President Trump on the United States-Mexico-Canada Agreement’ (2018), available
at https://www.whitehouse.gov/briefings-statements/remarks-president-trump-united-states-mexico-
canada-agreement/.
China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability • 21
3. Why does the US rigid approach contrast with China’s maximised flexibility
115 Heng Wang, ‘Divergence, Convergence or Crossvergence of Chinese and US Approaches to Regional
Integration: Evolving Trajectories and Their Implications’, 10 Tsinghua China Law Review 149 (2018),
at 178.
116 Kate Hadley, ‘Do China’s BITs matter? Assessing the effect of China’s investment agreements on foreign
direct investment flows, investors’ rights, and the rule of law’, 45 Georgetown Journal of International Law
255 (2013), at 261.
117 Shi, above n 85, at 25.
118 National Development and Reform Commission et al., above n 38, Part VIII.
119 Brummer, above n 6, at 630–634.
22 • China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability
implementing the BRI project, which has allowed for ongoing improvements to be
made to the efficiency of the BRI’s design and implementation. The BRI endeavours
B. Challenges
Maximised flexibility is a double-edged sword. While it allows for a more versatile
1. Issue-specific challenges
Maximised flexibility does not address certain thorny issues related to the BRI, partic-
ularly in relation to non-trade concerns. These range from labour, land ownership, and
environmental and national security concerns to issues related to state-owned enter-
prises.128 For instance, BRI-specific documents often contain statements of expected
behaviour, which frequently utilize vague and general language, such as ‘a long-term,
stable, sustainable financing system that is well-placed to manage risks’.129 They set out
principles, including ‘wide consultation, joint contribution and shared benefits’, the
enhancement of existing bilateral and multilateral mechanisms, and consistency with
international good practice, market orientation, and professional principles.130 These
documents do not bring much normative development regarding non-trade concerns.
As such, the lack of efficient solutions can imply negative consequences for the BRI, in
its overall treatment of these issues, in a consistent and coherent manner. This reduces
predictability and transparency and creates a more complex scenario in terms of risk
management for BRI-involved parties.
By contrast, a BRI-wide treaty with a formal institutional arrangement and more
clarity on certain aspects of the BRI could help build the legitimacy of and trust in the
BRI131 and could deal with the specific concerns of BRI countries, including as to the
transparency of the bidding process, and social and environment standards.
2. General challenges
Maximised flexibility may lead to new challenges concerning consistency, coherence,
predictability, risk management, and transparency in regards to the BRI more
generally.
First, in terms of consistency and coherence, there is a concern that the BRI may
‘spawn a number of competing normative commitments’ in the substantive and juris-
dictional sense, which is a type of global legal pluralism132 that could reshape the
world order.133 They are like ‘the alphabet soup of trade commitments, depending
128 Guiguo Wang, ‘Legal Challenges to the Belt and Road Initiative’, 4 Journal of International and Comparative
Law 309 (2017), at 322.
129 ‘Guiding Principles on Financing the Development of the Belt and Road’ (2017), available at
http://m.mof.gov.cn/czxw/201705/P020170515761133537061.pdf.
130 ‘Memorandum of Arrangement on Strengthening Cooperation on the Belt and Road Initiative Between
the Government of the People’s Republic of China and the Government of New Zealand’ (2017), available
at https://eng.yidaiyilu.gov.cn/zchj/sbwj/10479.htm, para II.
131 Zeng, above n 76, at 532.
132 For the analysis of global legal pluralism, see, e.g., Paul Schiff Berman, ‘Global Legal Pluralism as a
Normative Project’, 8 UC Irvine Law Review 149 (2018), at 149–182.
133 Bitas, above n 50, at 147.
24 • China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability
134 Ibid.
135 Klett and Oswald, above n 25, at 76.
136 National Development and Reform Commission et al., above n 38, Part VIII.
137 Yiping Huang, ‘Understanding China’s Belt & Road Initiative: Motivation, framework and assessment’, 40
China Economic Review 314 (2016), at 320.
138 Bitas, above n 50, at 145.
139 Helfer, above n 87, at 176–177.
140 Brummer, above n 6, at 630.
141 Clifford Chance, ‘Belt and Road: Dispute Resolution from a Chinese Perspective’, June 2018,
available at https://financialmarketstoolkit.cliffordchance.com/content/micro-facm/en/financial-
markets-resources/resources-by-type/thought-leadership-pieces/belt-and-road–dispute-resolution-
from-a-chinese-perspective–ju/_jcr_content/parsys/download/file.res/BRI___Dispute_Resolution_
from_a_Chinese_Perspective. pdf, at 2.
142 For the analysis of social values under PTIAs, see, e.g., Lorand Bartels, ‘Social Issues: Labour, Environment
and Human Rights’, in Simon Lester et al. (eds), Bilateral and Regional Trade Agreements: Commentary and
Analysis (Cambridge: Cambridge University Press, 2016), Volume 1, 2nd edition, 364–384.
143 Hao Tian, ‘China’s Conditional Aid and Its Impact in Central Asia’, in Marlene Laruelle (ed.), China’s Belt
and Road Initiative and Its Impact in Central Asia (2018), 33.
144 National Development and Reform Commission & the State Oceanic Administration, above n 24, Part IV
(maritime security).
145 Lattemann et al., above n 26, at 342.
China’s Approach to the Belt and Road Initiative: Scope, Character and Sustainability • 25
whether China’s PTIAs and their practices promote both economic and non-economic
public welfare in their partnering states under the BRI.146
may even shape global standards and foster a paradigm change in global standard
development.157
157 Jyh-An Lee, ‘The New Silk Road to Global IP Landscape’, in Lutz-Christian Wolff and Xi Chao (eds), Legal
Dimensions of China’s Belt and Road Initiative (2016), 424–425.
158 Jonathan Hillman, ‘Belt and Road Summit: Beijing’s Push on Trade’, 2 May 2017, available at
https://www.thecipherbrief.com/belt-and-road-summit-beijings-push-on-trade-2.
159 ‘Joint Communique of the Leaders Roundtable of the Belt and Road Forum for International Cooperation
(2017)’, available at http://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1462012.shtml, para 15(a).
160 Xinhua News Agency, ‘China to Push Formulation of Cross-Border E-Commerce International Rules for
World Customs’, 11 January 2018, available at https://eng.yidaiyilu.gov.cn/qwyw/rdxw/43482.htm.
161 For instance, there is a paper available at the website of State Council Information Office in
2017 that indicates such possibility. Monan Zhang, ‘Comprehensively Promote Cooperation on BRI
Framework Mechanism’, www.scio.gov.cn, 2017, available at http://www.scio.gov.cn/xwfbh/xwbfbh/
wqfbh/35861/36637/xgbd36644/Document/1551139/1551139.htm (The BRI should envisage major
normative and rule innovations in the trade and investment system).
162 ‘State Council, Opinions on Speeding up the Implementation of Free Trade Area Strategy’ (2015), available
at http://www.gov.cn/zhengce/content/2015-12/17/content_10424.htm.
163 Bath, above n 4, at 6.