The port of Piraeus in Greece is an example of a BRI success story. (China Daily)
China's investment volume in global ports has skyrocketed since the launch of Belt and Road Initiative but faces risks and challenges amid the fair share of controversy and turbulent political arena and financial markets, according to a report newly released by Grandview Institution, one of the most well-known independent think tanks in China.
Grandview Institution conducted the detailed survey of 42 overseas port projects invested by Chinese enterprises and interviewed a number of experts and business representatives engaged in overseas ports construction and operation.
Five years on, Chinese companies have participated in the construction and operation of a total of 42 ports in 34 countries involved in the Belt and Road Initiative launched in 2013, according to China's Ministry of Transport.
Ren Libo, founder and president of Grandview Institution, briefly introduced China's overseas port expansion projects and said a flood of Chinese investment helped to rejuvenate some of these ports.
The super-sized container ship Cosco Shipping Virgo, which has a deck area as large as four football fields, was delivered by Shanghai Waigaoqiao Shipbuilding Co at a port on May 29, 2018. (chinadaily.com.cn)
In Piraeus Port in Greece, for example, Chinese investment in 2016 led to increased trade: Piraeus was ranked seventh in Europe in 2017 by container throughput - up from eighth the year before - and leaped from the world's 93rd largest container port in 2010 to 36th in 2017.
Piraeus' success gives a snapshot of the immense business potential possible through growing trade and connectivity between China and Europe, highlighted by the Belt and Road Initiative, also known as BRI.
Despite abundant opportunities, the initiative is not free from concerns and challenges.
According to the report, one of the challenges is the need to expand the local element of BRI projects to address concerns that China's supply chain stands to benefit more than host states from infrastructure projects.
"Partnerships with local firms, known for their intimate knowledge of the domestic business environment, would be ideal," said Zhang Yunling, director of international studies at the Chinese Academy of Social Sciences, in Beijing.
Wherever possible, Chinese contractors should source inputs such as labor, materials, and provisions locally, to better contribute to local economies, according to the report.
Another challenge is some anti-China bias like labeling the Belt and Road Initiative a "debt trap" that China is laying by offering huge loans to countries already under a debt burden.
MV Cosco Netherlands, a giant container ship carrying Chinese-made commodities, arrives at Piraeus Port in Greece in August. (China Daily/Jiang Chenglong)
But the report said much of these criticisms were unfounded.
"The investment of enterprises is a commercial behavior based on the law of market economy, but not a reflection of the will of country," according to the report.
As the Belt and Road enters its sixth year, China is likely to progress in the ability to manage evolving challenges to the initiative, thus it is important to take stock of the critical challenges for the BRI as it enters its sixth year.