The People’s Republic of China’s President Xi Jinping launched the Belt and Road Initiative (BRI) in 2013, unilaterally, as a multi-billion dollars plan of State-backed investments covering an area spanning from the Chinese neighbouring countries to Western Europe and Morocco. Implementing global connectivity is the backbone of the BRI, which is mainly composed by massive infrastructural projects in more than 70 countries across the world.
The BRI is structured in two different dimensions: The Silk Road Economic Belt (SREB) and the 21st Century Maritime Silk Road Initiative (MSRI), which are intended to link China to Europe via land (SREB) and sea (MSRI).
The MSRI is a massive geopolitical project based on infrastructure development, especially concerned with building and managing ports on its intended route. The Mediterranean Sea is the final stop and target of a consistent part of the Chinese investments for the new Silk Road. The MSRI is paving the road for China’s blue economy and could represent an important factor in developing new form of political and economic dynamics among Mediterranean countries, especially in the Eastern Mediterranean. Turkey, Egypt and Israel are all involved in BRI projects with different types of investments and in different quantities. Will the Chinese New Silk Road programme contribute to change the geopolitical balance in the Eastern Mediterranean?
BRI: Egypt the key toward the Mediterranean area
Egypt is playing a pivotal role in China’s MSRI due to its strategic position between Africa, the Middle East and the Europe. The Suez Canal is attracting most of China’s investments in the country through the renovation of the canal’s many ports, such as Ismailia and Port Said. Moreover, since 2015, the canal has increased its capacity thanks to the Suez Canal Area Development Project, mainly financed by China. The natural resources discovered in Zohr offshore gas field are increasing the opportunities to develop further partnerships in building offshore facilities within the MSRI platform and granting new chances for China in the energy sector. The government of Al-Sisi, as most of the governments in North Africa, has demonstrated a keen interest in welcoming important investments and loans from China in order to boost growth and infrastructures, and, among other reasons, replenish the Egyptian treasury with foreign currency to counter the floatation of the national currency. In 2017, a comprehensive strategic partnership agreement was signed between China and Egypt to enhance the cooperation and upgrading the status of Egypt among China’s partners. The aim on China’s side seems to maintain economic and political stability in Egypt through the MSRI in order to be granted access to the natural entry point to the Mediterranean from the East, and to make Egypt one of the biggest manufacturing hubs of Chinese goods directed to African, European and Middle Eastern markets.
BRI: Israel as a stable alternative to the Mediterranean
MSRI in Israel is not focusing only on investments on ports infrastructures. The MSRI agreement with Israel includes Chinese investments and cooperation agreements in several sectors as renewable energy, chemicals market, water, agriculture and infrastructures beyond ports. A new railway line project was announced between Eliat and Ashdod, connecting the Gulf of Aqaba with the Mediterranean. Despite the wide and deep presence of China in the Suez Canal, China wants to develop alternative routes heading to the Mediterranean. Israel is a reliable partner in Eastern Mediterranean and Middle East for China, as it has deep ties both with the United States and the European Union.
From an Israeli perspective, the MSRI is an opportunity to develop some areas of the country such as the South Negev through the Red-Med railway, and to expand the capacity of their ports, especially Haifa and Ashdod. Furthermore, through the new infrastructure projects included in the MSRI, Israel could mitigate its trade dependence from the Suez Canal and increase its bargain power toward Egypt. Sino-Israeli ties would improve the Israeli trade role between Asia and Europe. However, it is still questionable whether this new trade capacity will create more competition or collaboration between Israel and Egypt.
Turkey a latecomer in the BRI
Turkey is a natural gateway for Chinese goods and interests to Europe. Nevertheless Turkey’s involvement into the BRI came late along the road and was noticeably less intense if compared to other Mediterranean countries. The main concerns for China regarding Turkey are focused on the economy and security of the country. The attempted coup in 2015, the conflicts affecting Turkey’s south-eastern periphery and the weakening of Turkish currency are limiting Chinese investments in Turkey. Moreover, the Turkey’s stance in support of the Uygurs, the Turkic Muslim population of Xinjiang, is increasing tensions in the relation between the two countries. As consequence, the flow of foreign direct investment (FDI) from China to Turkey has slowed in recent years. Turkey is also wary of China’s relations with the Republic of Cyprus (RoC) in the energy sector. Turkey and RoC are indeed in open contrast in this field. However, in a recent attempt to improve bilateral relations, Ankara officially recognised the East Turkistan Islamic Movement (ETIM) – the Muslim separatist group founded by militant Uighurs, in northwest China’s Xinjiang province – as a terrorist organization and started cooperating with China on counter-terrorism initiatives.
Starting from 2015, and despite political divergences, Chinese investments in Turkey under the BRI framework in energy, logistic, infrastructure, manufacturing and telecommunication has increased, albeit modestly. Turkey is aware of the importance of attracting Chinese investments and has also launched a proactive policy toward China and Central Asia, known as the Middle Corridor in order to build up a transport route to connect Anatolia to China. The first important infrastructural step taken in this sense was the Baku-Tbilisi-Kars railway that connected Turkey to the Trans-Caspian International Transport Route, which is vital for the BRI and the flow of goods between China and Europe. Despite the low political confidence between Turkey and China, the BRI remains the most pragmatic option for China to exploit Turkey’s geographical position and for Turkey to attract Chinese FDI into its fragile economy.
BRI is not just an economic strategy
The BRI in the Eastern Mediterranean could increase the volume of trade in the area but political stability is condicio sine qua non to boost the flow of trade and investments. China is aware about the fragile and complex political situation in Eastern Mediterranean. The China’s government is currently maintaining equal relations with all the actors in the volatile region, as the case of Israel and Egypt, or Turkey and RoC, demonstrate, to capitalise on their proximity to the EU. The involvement of Beijing in the Eastern Mediterranean is relatively new if compared to other countries. So far, the Chinese strategy has been to carefully follow political developments while gaining experience in dealing with a potentially explosive area.
Eastern Mediterranean countries are very likely to deepen their involvement into the BRI to secure Chinese investments into their economies. During the Belt and Road Forum in May 2017, in the presence of representatives from Egypt, Israel and Turkey including Turkish President Recep Tayyip Erdoğan, Chinese President Xi Jinping stated: “China is willing to share its development experience with all countries. We will not interfere in other countries’ internal affairs”. Until now, through the BRI, China has focused predominantly on developing economic ties and not on interfering with the political affairs of the region. However, it is not excluded that in the future China will develop strategies and policies focusing on the Eastern Mediterranean. Welcoming the BRI is not just an economic strategy for Turkey, Israel and Egypt but also a pattern to create new geopolitical alternatives while the presence of the United State and EU seems to be diminishing.
Research Assistant at European Neighbourhood Council
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