China’s Two Silk Roads: Implications for Southeast Asia (Amended Version)

Abstract

In December 2014, Chinese Premier Li Keqiang attended a Shanghai Cooperation Organization meeting of prime ministers in Kazakhstan. He traveled on and met 16 other government heads at the third China-Central and Eastern European Leaders’ Meeting in Serbia where he advertised a US$10 billion Chinese credit line for infrastructure development, a US$3 billion Chinese equity investment fund, and a deal to build a new railway link from Budapest through Belgrade and Skopje to the Greek port of Piraeus on the Mediterranean Sea. Li Keqiang then departed for Thailand where he signed a US$ 10.6 billion financing deal to build the Thai segment of a railway that will connect Bangkok to China, and he pledged US$3 billion at the Greater Mekong Subregion Economic Cooperation summit to finance infrastructure connectivity, Chinese machinery exports, and poverty reduction efforts. The connection between these far-flung destinations is China’s two Silk Road initiatives. Xi Jinping announced the Silk Road Economic Belt initiative during his tour of Central Asia in September 2013. This envisions efficient, high volume land connectivity between China and Europe—with links to all major sub-regions along the way. He announced the 21st Century Maritime Silk Road initiative during his visit to Indonesia in October 2013. This envisions Chinese participation in the development of major ports on the Eurasian rim between China and the Mediterranean Sea in order to promote maritime connectivity. China refers to this pair of initiatives as “One Belt, One Road” (yidai-yilu). Together, the two Silk Roads constitute a grand vision of Eurasian integration under China’s leadership.