To date, China has signed cooperation agreements with 150-plus countries and international organizations under the framework of Belt and Road Initiative (BRI). In particular, much headway has been made in economic and trade cooperation. Of the 279 items on the outcome list of the 2015 Belt and Road Forum for International Cooperation, 255 items have been completed or have become routine works.

From 2013 to 2018, China’s trade volume with countries along the Belt and Road exceeded $6.5 trillion, among which the 2018 figure stood at $1.3 trillion, up by 16.3 percent year-on-year. During the period, 12,000 cargo train journeys were made on the China-Europe railway lines, connecting China with 43 cities in 15 European countries. Over 100 overseas warehouses for cross-border e-commerce businesses have been established in Belt and Road countries.

China’s accumulated outbound direct investment in Belt and Road countries totaled $80 billion. And solid progress has been made in a batch of connectivity projects. The China-Maldives Friendship Bridge in Maldives has opened to traffic; the Addis Ababa-Djibouti railway has become operational; the Gwadar Port is able to run at full capacity.

The construction of economic and trade cooperation zones in BRI countries has been steadily pushed forward, with 82 such zones already being built, including the China–Belarus Industrial Park, the Thai-Chinese Industrial Zone in Thailand’s Rayong province, the China-Egypt TEDA Suez Economic and Trade Cooperation Zone and the Sihanoukville Port Special Economic Zone.

Cross-border economic and trade cooperation mechanisms have gradually improved. Besides bilateral economic and trade joint commissions and mixed commissions, China has set up working teams for trade facilitation and investment cooperation jointly with the relevant countries, established service trade cooperation mechanisms with seven countries and signed e-commerce cooperation documents with nine countries.

Over the past six years, to jointly promote trade facilitation, China has signed 78 cooperation documents with countries and regions along the Belt and Road in an attempt to accelerate the alignment of working systems, coordination of technology standards, mutual recognition of inspection results and networking of electronic certificates.

China has also launched the “one station for all” for international trade on a trial basis to quicken the integration of inspection, quarantine and customs clearance, in a bid to realize unimpeded import and export.

In addition, China is actively working with relevant countries to promote third-party market cooperation under the framework of the BRI, the latest progress being cooperative documents on third-party markets with Japan, Spain, the Netherlands and Belgium. The mechanisms and agreements have provided solid institutional guarantee for Belt and Road construction.

China is also actively promoting trade and investment liberalization and facilitation. It has signed free trade agreements with 10-plus countries along the Belt and Road. In 2018, China’s FTA with Georgia came into effect; the FTA negotiation with Mauritius was completed; China signed a Protocol on Upgrading the FTA with Singapore and economic and trade cooperation agreements with the Eurasian Economic Union and marked progress was made in RCEP negotiations. As a result, a high-standard free trade network that covers neighboring countries, connects Belt and Road countries and embraces the world is taking shape.

In spite of the better-than-expected results, China is faced with problems and challenges in the joint construction of the Belt and Road.

Different understanding on and insufficient communication of policies, strategies and planning between China and some Belt and Road countries have undermined the results. Due to insufficient preliminary study and hasty commencement, some projects failed to meet host countries’ demands; a lack of experience and awareness of risks prevention led to incompetence in defusing risks; trade and investment dispute settlement mechanisms are yet to be improved.

Over the next five years, China should further expand pragmatic economic and trade cooperation with Belt and Road countries by prioritizing the implementation of the action plan on the BRI; boosting foreign trade; innovating on investment methods; pressing ahead with the construction of major projects and promoting trade and investment liberalization and facilitation.

To start with, China should make full use of bilateral and multilateral economic and trade negotiation mechanisms to improve alignment and increase consensus. We should actively explore means of aligning the BRI with development strategies and policies of countries involved, formulate action plans on economic and trade cooperation with key countries and actively negotiate on and sign agreements on infrastructure construction, capacity cooperation, investment facilitation, cooperation zone construction, service trade and e-commerce to expand common interest.

Also, economic and trade cooperation mechanisms should be improved, such as transnational quick response mechanisms, inter-government special cooperation mechanisms and provincial-level cooperation mechanisms.

Cooperation with international organizations should also be boosted with concrete results in subject study, project cooperation, forums and conferences.

Separately, China should accelerate third-party market cooperation under the Belt and Road framework, especially by aligning the initiative with the EU’s Euro-Asia connectivity strategy and expediting the launching of concrete projects with countries that have already signed third-party market cooperation agreements with China.

Trade structure needs optimization and upgrade in the next few years. And we should support the export of large-sized complete sets of equipment in communication, electricity and railway sectors and the establishment of global marketing and after-sales service systems.

Service trade, technology trade and e-commerce should be vigorously developed. And new business types and models such as cross-border e-commerce should be cultivated and more overseas warehouses be built in key BRI countries and markets.

China should also diversify its import sources by creating international cooperation platforms, such as the China International Import Expo, Silk Road International Exposition, China-ASEAN Expo, and China-Eurasia Expo.

Significance should also be attached to major investment and cooperation projects. On the one hand, China should improve services for and supervision of outbound investment and cooperation, strengthen the filing (approval) management of outbound investment. On the other hand, industry associations and overseas Chinese enterprise associations are expected to play a bigger role in regulating Chinese companies’ overseas operations as per local laws and better fulfilling their social responsibilities in host countries.

Chinese financial institutions such as the China Development Bank and the Export-Import Bank of China are encouraged to play a positive role in major Belt and Road projects. And joint financing services with multilateral banks such as the Asian Infrastructure Investment Bank and Silk Road Fund should be developed; multilateral and bilateral investment funds should be fully utilized, and cooperation with commercial financial institutions should be strengthened to accelerate the launching of more market-based projects.

Finally, laws and regulations concerning economic and trade cooperation along the Belt and Road should be further improved. And China should continue to push forward FTA and investment treaty negotiations and signing with potential countries and promote the upgrade of existing FTAs. A sound legal system is the basic guarantee to achieve this. Thus, China should further strengthen rule coordination and innovation, expedite the establishment of dispute settlement institutions, adopt universally recognized norms and standards in projects, and promote the internationalization of Chinese standards.

The author is vice-president of the Chinese Academy of International Trade and Economic Cooperation, Ministry of Commerce.

The author contributed this article to China Watch exclusively. The views expressed do not necessarily reflect those of China Watch.

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