Maldives keeping multiple doors open in foreign relations . . .
Last week, Maldives President Ibrahim Solih signed a defence agreement with the U.S., not long after accepting more than C$2.7 billion in infrastructure development and loans from India. In contrast, Solih’s predecessor, former President Abdullah Yameen, welcomed Chinese investment and loans to build transportation and tourism infrastructure, which have boosted the country’s economy. But those projects, carried out under China’s Belt and Road Initiative (BRI), have left the country with C$1.8 billion in debt. Nevertheless, Solih’s government has indicated that China will remain an important development partner in the country’s future.
Cambodia facing tightening sanctions . . .
Meanwhile, Cambodia has increasingly turned to China as a development partner, even as building collapses and development failures dog the narrative of Chinese investment in the country. The Cambodian government is likely sticking with China to compensate for two recent economic impacts: The EU removing Cambodia’s duty-free access to its markets last month over human rights abuse allegations, and the U.S. imposing Magnitsky Act sanctions on Cambodian officials in December. While Cambodia is tightening its relations with China, it is also engaging in increased defence and development assistance co-operation with Japan, a long-time investment partner. The Cambodian case illustrates how the BRI could be a lifeline for countries hit by Western sanctions, and how regional players such as Japan might fill in the gaps.
Increasing scrutiny and competition . . .
Amid the COVID-19 pandemic and increasingly hostile U.S.-China relations, the BRI, China’s signature foreign policy strategy, has become Beijing’s calling card around the world. Mainly composed of infrastructure projects and trade deals across Eurasia and Africa, it has attracted widespread criticism for its alleged use of “debt diplomacy” and bribery to manipulate local governments. Some analysts have pushed back on these claims, arguing that this picture negates local authorities’ power to negotiate and even set the terms of engagement with China. The BRI’s future will be determined not only by the effectiveness of rival initiatives by Japan, Korea and Taiwan, but also the ability of BRI partner nations to play off both Beijing and Washington in pursuit of their own foreign policy objectives. The Maldives and Cambodia illustrate the balancing act currently underway in these countries.
- BBC: China debt dogs Maldives’ ‘bridge to prosperity’
- The Diplomat: Inside China’s Belt and Road tangle
- Nikkei Asian Review: Can Cambodia fill the gap left by EU sanctions with China FTA?