China-Pakistan corridor draws $46b

Source:Global Times Published: 2017/5/7 22:48:39

Flagship project offers benefits for both sides

A loaded Chinese ship is ready for departure during a ceremony at Gwadar port, Pakistan, on November 13, 2016. Photo: IC

The China-Pakistan Economic Corridor (CPEC), first proposed by Chinese Premier Li Keqiang during a visit to Pakistan in May 2013, has attracted $46 billion in investment so far and become one of the flagship projects in the China-proposed "One Belt, One Road" initiative, data from the China-Pakistan Friendship Association showed.

Chinese analysts and officials are keen on the prospects of the economic corridor, a 3,000-kilometer network of roads, railways, pipelines and infrastructure projects that starts from Kashar, Northwest China's Xinjiang Uyghur Autonomous Region, and ends at Gwadar Port, Pakistan.

Chinese Foreign Minister Wang Yi was quoted in a report by the Xinhua News Agency on April 27 as saying that "If the 'Belt and Road' initiative is a symphony involving countries along the route, then the CPEC is the sweet prelude to the show."

In April 2015, Chinese President Xi Jinping laid out the framework of a "1+4" cooperation blueprint during a state visit to Pakistan, which highlighted the building of the CPEC along with the construction of Gwadar Port, energy, basic infrastructure and industrial cooperation. The move has resulted in a further upgrading of bilateral economic ties.

About 40 cooperation agreements and memoranda of understanding have been signed under the cooperation framework, said media reports, and more projects are under negotiation.

Prominent examples include the Gwadar Port, whose land connection opened in November, and the expanding of the Karakoram Highway that links China's Kashar with Pakistan's Thako.

Editor's Note:

Ahead of the Belt and Road Summit, which is scheduled to be held in Beijing from May 14-15, Global Times reporter Li Xuanmin (GT) spoke over the weekend in Beijing with Sha Zukang (Sha), the chairman of the China-Pakistan Friendship Association. They discussed the benefits of the CPEC to both countries and some concerns that have overshadowed the corridor such as safety and limited investors.

Sha Zukang Photo: Courtesy to China-Pakistan Friendship Association

GT: What benefits has the CPEC brought to China and Pakistan?

Sha: It's a win-win situation. For China, we can transfer our advanced capacity to overseas markets, contributing to our agenda of industrial upgrading. Pakistan has distinctive advantages in receiving such capacity.

Also, as a pilot project for China's Belt and Road initiative, the CPEC sets an example for other countries and regions along the route, showing that joining the initiative is beneficial for regional connectivity and economic prosperity.

The benefits to Pakistan are numerous. In recent years, the GDP growth in Pakistan maintained a robust rate of 4 percent, and many of my Pakistani friends attribute it to the establishment of the CPEC.

Pakistani officials have hailed the CPEC as a "game-changer" for the country's economy. At the time when the CPEC was initiated, Pakistan was not an attractive destination for foreign investment due to its sluggish economy.

The construction of the CPEC has reversed the trend and presented global investors with a brand-new image of the country.

Other benefits include improved infrastructure, reduction of energy shortages and creation of jobs.

More than 13,000 Pakistani nationals are involved in projects under the CPEC.

The Gwadar Port project is also estimated to provide hundreds of jobs in the next few years.

Notably, Chinese companies that participate in the CPEC also have a strong sense of social responsibility. They are willing to share their development with the locals.

For example, Chinese companies participated in the construction of Gwadar Port set up a 1 million Pakistani rupee ($9,813) education fund last year to help Pakistani students study in China and learn Chinese.

GT: Some analysts have worried that safety issues such as terrorist attacks may pose a threat to the CPEC. What is your perspective?

Sha: The Pakistani government has launched a lot of military operations in recent years to effectively curb terrorism.

The country has also attached great importance to ensuring the safety of the CPEC. It has deployed special army personnel for the safety of CPEC workers, and there is already an integrated mechanism of all the state and provincial security operators, whose number has even surpassed that of Chinese workers.

I believe the safety issues of the CPEC can be solved through those efforts.

GT: Most of the projects under the CPEC are funded by Chinese investors. Virtually no investors have come from a third country. What is your opinion of this situation?

Sha: Currently, most of the projects are financed by Chinese and Pakistani companies.

But some other countries have shown intentions to invest since the CPEC was launched, and there are some energy projects that are already co-financed by third-party investors.

As the CPEC proceeds and Pakistan's investment environment improves, I believe more third-country investors will be attracted to participate in the projects.


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