I recently attended the World Economic Forum’s third Belt and Road Forum in Davos, Switzerland. Compared to previous years, the latest forum attracted more distinguished speakers and audience members, including many of the most senior political, business, and academic leaders from countries participating the Belt and Road Initiative (BRI). It was apparent that the BRI continues to gain momentum.

The Chinese government needs to be more effective in communicating and explaining the goodwill of BRI. However, eloquent messaging is only the tip of the iceberg as actions speak volumes louder than words.

China can study its own success to craft the best strategy to push the BRI forward. When China began its economic reform and opening-up process over 40 years ago, it faced severe international skepticism and domestic ideological resistance. Deng Xiaoping ingeniously created Shenzhen and other special economic zones to conduct an experiment with market economies in socialist China. The stunning success of the SEZs cleared doubts in China and abroad, and paved the way for China's meteoric economic rise -- creating trillions of dollars of wealth and leading to the greatest poverty alleviation in world history.

A similar approach may be adopted to speed up the implementation of the BRI. China can collaborate with a friendly Belt and Road country to establish a BRI Special Economic City, or SECs, within that country. The SEC would showcase the key BRI principles by aligning the interests of the host country, China, investors and the international community to promote policy coordination, infrastructure connectivity, unimpeded trade, financial integration and connecting people.

Urbanization is a proven catalyst of economic development — a vital vehicle for wealth creation, and an impetus for innovation and inclusion. While cities contain more than half of the world’s population, they only occupy 3 percent of the world’s arable land. The host country, in exchange for an undeveloped, uninhabited tract of land, will gain an economic juggernaut that will substantially increase the region’s wealth — just as Shenzhen did for Guangdong province. The land should be large enough to build a world-class city like Hong Kong or Dubai, and come with a long-term lease of 50 years or longer. In return, the host country would receive an initial lease payment, a tax split with the SEC, and, at the end of the lease, a world-class metropolis.

The lease should be made to a company rather than a government through an open auction process to ensure the fairness of leasing terms and conditions. Diversity increases innovation in products, services, and business models — creating more sustainable and competitive economic growth. In addition to diverse and rich human capital, innovation in the SEC will be bolstered by a social, political, and regulatory environment that encourages a strong arts and sciences scene.

To further support the development of a global city, the SECs will follow international best practices and create an independent judiciary based on the rule of law. This is critical to make the SEC a secure, fair and efficient playground that provides full protection to residents’ life, liberty and property. During the lease, the SEC’s security forces and law enforcement agencies should be independent of the host country. The SECs will also create effective financial and fiscal systems, including free capital flows and low taxes, and its own digital currency. All of these measures will help attract global participation from world-class companies and institutions.

Although the lease will be granted to a private company, the agreement needs to be guaranteed by the international community. On this critical point, China does have a special role to play. As the initiator of the BRI and a world economic power, it is China’s duty to volunteer as a guarantor of the SEC agreement. It should also invite other countries with good governance, as well as geopolitical and economic clout, to co-guarantee the agreement. This ensures the enforceability of the agreement, therefore boosting the confidence of private investors to lease, invest and develop the SEC.

The Chinese government should support the creation and maintenance of a sound contract and governance structure of the SEC, rather than provide financial assistance to the SEC or Chinese companies doing business there. Chinese investors will do business in the SEC only because they are attracted by the commercial opportunities there and will compete on equal footing with all other investors, including those from the host country.

Under such conditions, the SEC will be a powerful magnet for diverse talent, capital, and critical technology. These productive factors will develop the SEC into a modern, smart, and green city — a showcase of inclusive and sustainable growth to the world. The success of the SEC, demonstrated by the social and economic benefits brought to the host country as well as its own prosperity, will be the best validation of the BRI. As a result, many other countries will be eager to participate.

This approach will greatly reduce the Chinese government-sponsored investment in the BRI, and therefore increase its capacity for domestic public expenditures, which will mitigate domestic concerns over the BRI. China will earn international recognition for making positive contributions to Belt and Road development without creating so-called credit traps for countries receiving Chinese loans.

The idea of creating SECs is similar to the charter city concept developed by Professor Paul Romer, the winner of 2018 Nobel Prize in economics. He believes that we are in an era which demands the creation of not only new companies but also new cities. These cities, Romer argues, become conduits of development for the regions and countries that surround them. Just as Hong Kong and Shenzhen played an integral part in China's economic rise, charter cities may be the key to developing Belt and Road economies.

Do not underestimate the power and influence of a great city: Athens is the cradle of Western civilization; Florence is the birthplace of the Renaissance; Shenzhen is the role model of Chinese reform. A successful SEC on the Belt and Road will serve as the great catalyst to rejuvenate the ancient Silk Road.

Li Shan is CEO of Silk Road Finance Corporation in Hong Kong, and co-chairman of the Swiss-China World Silk Road Association.

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

All rights reserved. Copying or sharing of any content for other than personal use is prohibited without prior written permission.