Weekly News Roundup: Dispatches from the Silk Road Economic Belt

Chinese companies wary of political risks on Xi's Belt and Road

As the global limelight fades from President Xi Jinping’s “Belt and Road” summit, the main actors -- Chinese state-owned companies -- are warning about the political risks they face along the route. Earlier this month Xi outlined plans to direct as much as 840 billion yuan ($122 billion) to build roads, railways, ports and pipelines across Asia and beyond, securing China’s central role in world trade. The plan has the country’s state-owned enterprises weighing investments in 65 participant nations, almost two-thirds of which have sovereign debt ratings below investment grade. (Bloomberg)

Xinjiang exports liquid chemical to Europe via freight train

A freight train loaded with 2,000 tonnes of liquid chemical departed Friday from Korla city in northwest China's Xinjiang Uygur Autonomous Region to the German city of Ludwigshafen. It is the first time that Xinjiang has exported liquid chemical to Europe via the China-Europe freight train route. (Xinhua)

CPC expels former commander of Xinjiang Production and Construction Corps

Liu Xinqi, former commander of Xinjiang Production and Construction Corps (XPCC), has been expelled from the Communist Party of China (CPC) and demoted for "severe violations of Party code" including graft, authorities announced on 24 May. Liu, also former deputy secretary of the CPC committee of the XPCC, allegedly took advantage of his post to obtain benefits for others and allowed relatives to use his influence to profit and take bribes, according to a statement from the CPC Central Commission for Discipline Inspection (CCDI). GlobalTimes

THE US-SAUDI PLOT FOR IRAN THAT SPELLS TROUBLE FOR CHINA’S NEW SILK ROAD
Riyadh may already have the building blocks for a proxy war in Balochistan, a key part of Beijing’s Belt and Road Initiative  (Scmp)

Kidnapping highlights risks along China-Pakistan Economic Corridor

A Chinese man and his wife who teach Chinese at a local language center were abducted from Quetta's Jinnah Town, in Baluchistan Province in southwestern Pakistan Wednesday. No group has claimed responsibility for the kidnapping yet. But it is worth noting that Islamic militants have often carried out abductions of foreigners on Pakistani soil, either for ransom or to get publicity for their cause.Chinese people have also been targeted occasionally, despite the friendly relations between the two countries. The Chinese presence in Pakistan has increased in the past few years thanks to the thriving China-Pakistan Economic Corridor (CPEC), a $46-billion investment project that involves roads, ports, power plants and other crucial infrastructure in this South Asian country. It is also the flagship project of the China-led Belt and Road initiative. Baluchistan is in the center of the CPEC which is expected to link China's Xinjiang Uyghur Autonomous Region to the Pakistani port of Gwadar on the southern coast. (Global Times)

Asia’s dynamism at risk in US and China’s competing visions for global trade

The US commitment to liberal trade has provided the environment within which Asia has prospered. In all cases of rapid economic growth in this region, the expansion of trade has played a decisive role, via exploitation of comparative advantage, economies of scale, access to know-how and heightened competition. The results have been dramatic, notably in the case of China. Its share of world exports of goods jumped from around 1 per cent in 1981 to 4 per cent in 2000 — just before it joined the World Trade Organisation in 2001 — and 14 per cent in 2015. Emerging Asia’s share of world exports of goods soared from 4 per cent in 1981 to 21 per cent in 2015. Meanwhile, Japan’s share has moved in the opposite direction, with a fall from 10 per cent in 1993 to 4 per cent in 2015. Overall, Asia’s share of world exports of goods (including re-exports) reached 33 per cent in 2015. (FT)

Chinese Uyghur colonies in Syria a challenge for Beijing
A reporter for Dubai-based Al Aan TV recently aired an undercover story on Idlib province – the Syrian “rebel” opposition stronghold that is supported by the US and other Western governments – and the site of the recent alleged chemical attack that prompted direct US missile strikes against the Syrian Arab Army. While the report confirmed that al-Qaeda indeed dominates Idlib, there was another unexpected revelation: the presence of large Chinese Uyghur jihadi colonies. (Asia Times)

Podcast: For Central Asia, 'OBOR' Means 'China,' And All That Comes With That

OBOR’s promise of enhanced trade and greater global connectivity is enticing but there are many aspects of OBOR that remain unclear. For example, who is paying for it.On this week's Majlis podcast, we discuss Central Asia’s role in OBOR. Chinese President Xi Jinping first announced plans for OBOR in September 2013, but its origins go back to the 1990s when Beijing decided to develop the oil-rich Tarim Basin in China’s western Xinjiang region. Pantucci recalled, "There was this huge push to develop the west because the Chinese thought they needed to develop their western regions, so the investment and the attention was really in Xinjiang, but then there’s no kind of logic to developing Xinjiang if the regions around it aren’t [developed]." China made its first widely publicized entry into Central Asia in 1997, when it signed an agreement with Kazakhstan to construct an oil pipeline from western Kazakhstan to Xinjiang. (Rferl)

Ukraine needs China loan deadline pushed back, Deputy PM say

Ukraine needs more time to submit proposals for coal and gas projects to China in order to secure funding worth up to $3.65 billion as Kiev is unlikely to meet a June deadline, Deputy Prime Minister Stepan Kubiv told Reuters.Ukraine signed a loan agreement with the China Development Bank (CDB) in 2012 but has repeatedly pushed back deadlines by which it needs to submit plans for how the money will be used, because of differences between Ukrainian government bodies.Ukraine needs the money to revamp its energy infrastructure at a time when its economy is emerging from a deep recession and is being supported by a $17.5 billion aid programme from the International Monetary Fund. (Reuters)

Editorial: Why Belt and Road plan is a game changer that could further open China’s markets Beijing’s $1 trillion push to reshape the international trade landscape passed another milestone last week, with the successful conclusion of the Belt and Road Initiate Forum, where more than 270 cooperation deals were signed. It was the highest-level multilateral event held in China, with heads of state or government from 29 partner countries in attendance. The agreements inked at the summit covered a wide range of sectors including telecommunications, infrastructure development, trade promotion and financial cooperation. It also pushed for greater openness in terms of market access and information flow between member countries – a key tenant of the Belt and Road Initiative. (Caixin)

China pushing for stability in Afghanistan to meet its own ends
Rather than filling the void of the United States, China is trying to play a constructive role in Afghanistan to enhance domestic security.After all, instability in Afghanistan fuels the ambitions, capabilities, and impacts of terrorist organisations in Xinjiang, the historic homeland of the Uighur ethnic group in western China.Through enhancing its influence in Afghanistan, China aims to outmaneuver Uighur terrorists and remove the possibility of terrorism in Afghanistan impacting security in Xinjiang.But the role of China in Afghanistan remains limited. China has ignored actions by terrorist organisations in Afghanistan that are not directly harming Chinese interests, but instead Afghan civilians. Nor has China allowed for NATO operations along its border. Whether or not violence in Afghanistan crosses the border, China’s economic interests are under threat through instability in the country. (Asian Correspondent)

India opens longest bridge on China border

India has inaugurated a 9.15km (5.68-mile) bridge over the Lohit river, easily its longest ever, which connects the disputed state of Arunachal Pradesh with the north-eastern state of Assam.China claims Arunachal Pradesh as its own, and refers to it as "southern Tibet".Beijing recently strongly objected to India's decision to allow Tibetan spiritual leader Dalai Lama to visit the state and has also protested against the development of military infrastructure there.But India has defended its right to do so. (BBC)

Tajikistan Takes Up Chinese
Chinese classes are on the rise, but still not a priority for Tajik students. (Diplomat)



CENTRAL ASIA


Uzbekistan Banks on Russian Oil for New Refinery

Uzbekistan revealed in late April that it had begun building a new $2.2 billion oil refinery that would produce fuel for sale domestically and abroad. Official news sources stated perfunctorily that oil supply agreements had already been reached with Kazakhstan and Russia, although the finer details still in fact need to be decided.The ambition is formidable.The refinery being built in the Jizzakh province, which lies adjacent to the South Kazakhstan Region, is being designed to process up to 5 million tons of oil annually, an almost 50 percent increase on Uzbekistan’s existing refining capacity. It will when completed turn out 3.7 million tons of gasoline, more than 700,000 tons of aviation fuel and 300,000 tons of associated products. Completion of the project is slated for 2022. (Eurasianet)

Is This The Start Of Regional Cooperation In Central Asia?
It looks like the new president of Uzbekistan, Shavkat Mirziyaev, is keeping at least one of his promises.Not long after independent Uzbekistan's founding president, Islam Karimov, died in September 2016, his successor said one of his priorities would be better relations with neighboring Central Asian states.Mirziyaev met with Turkmen President Gurbanguly Berdymukhammedov at the Turkmen Caspian resort area Awaza on May 19-20, and among the many agreements they reached was one on Turkmen electricity exports to Kazakhstan and to Kyrgyzstan via Uzbekistan's territory.
That doesn't sound like much, but it reverses a nearly 15-year trend of decoupling in Central Asia.

(Rfrl)

Kazakhstan set to agree to limit oil production, but on new conditions

OPEC and non-OPEC producers, including Kazakhstan, will meet in Vienna May 25 to renew the deal limiting oil production for an additional six months. Kazakhstan will sign the agreement if the restrictions do not apply to Kashagan field, according to Minister of Energy Kanat Bozumbayev.“We will negotiate with the OPEC and non-OPEC countries on the role that Kazakhstan will play by joining this agreement on May 24-25. On the same conditions, most likely, it will not work. We will discuss what measures we will join,” he said prior to the talks.

Kazakhstan: Law on Religious Clothing in the Works
The government in Kazakhstan looks set to intensify its war on what it dubs “non-traditional Islam” by drafting laws banning clothing and other attributes adopted by ultra-orthodox Muslims. Almaty TV reported this week that a law that could be presented in parliament later this year envisions restrictions on wearing certain types of black clothes and trousers with ankle-length hems. Beards could also be targeted. (Eurasiant)