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Xi Jinping Positions China at Center of New Economic Order

President Xi Jinping of China delivered a sweeping vision of a new economic global order on Sunday, positioning his country as an alternative to an inward-looking United States under President Trump.

Mr. Xi, surrounded by autocratic leaders from Russia and Central Asia at a forum in Beijing, pledged more than $100 billion for development banks in China that he said would spearhead vast spending on infrastructure across Asia, Europe and Africa. Noticeably absent from the gathering were leaders of major Western democracies.

Sparing no modesty for the plan, Mr. Xi called the initiative, known as "One Belt, One Road," "this project of the century." The program, based on Chinese-led investment in bridges, rails, ports and energy in over 60 countries, form the backbone of China's economic and geopolitical agenda.

In a new twist for China, which has generally been skeptical of social programs by the World Bank, Mr. Xi said the initiative would tackle poverty in recipient countries. He promised to deliver emergency food aid and said China would begin "100 poverty projects," though he stopped short of providing details.

He portrayed the plan as "economic globalization that is open, inclusive, balanced and beneficial to all." China would invite the World Bank and other international institutions to join it in meeting the needs of developing – and developed – countries, he said, in a suggestion that he is seeking to forge new markets and export China's model of state-led expansion.

Mr. Xi stressed the differences between the United States system of alliances and his notion of commerce under China.

"We have no intention to form a small group that would dismantle stability but we hope to create a big family of harmonious coexistence," he said, with the Russian president, Vladimir V. Putin, in the front row of the convention center where he spoke.

So far, China has spent only $50 billion on the initiative that Mr. Xi announced four years ago, a relatively small amount compared with the vast domestic investment program.

But Mr. Xi told the audience – made up of more than two dozen national leaders, envoys from more than 100 countries and officials from various financial institutions and businesses – that he was increasing the amounts available to China's main policy banks.

The China Development Bank and the Ex-Im Bank would dispense loans of $55 billion between them, and the Silk Road Fund would receive an additional $14 billion, he said. About $50 billion more would be directed at encouraging financial institutions to expand their overseas renminbi fund businesses.

The Chinese government has been planning the forum for months, introducing an extensive propaganda campaign on the initiative in state news media and squelching alternative views from skeptical scholars and state company executives worried about burning money.

China, seeking validation for the project, pressed Western countries and American allies to dispatch their leaders, but most declined, sending lower level officials instead.

Among the attendees were Britain's chancellor of the Exchequer, Philip Hammond, and Matthew Pottinger, senior director for Asia at the National Security Council in Washington.

In remarks to the forum, Mr. Pottinger urged China to insist on transparency in government procurement as projects began. "Transparency will ensure that privately-owned companies can bid in a fair process, and that the cost of participating in tenders will be worth the investment," he said.

American firms were eager to work on the projects, he said.

Prime Minister Narendra Modi of India did not turn up, concerned about the significant infusion of Chinese money into its rival Pakistan. Prime Minister Nawaz Sharif of Pakistan, for his part, whose country has been a longtime ally of China, said he was proud to stand "shoulder to shoulder" with Beijing.

The Indian government said in a statement on the eve of the forum that the initiative risked "unsustainable debt burden for countries," a worry expressed by some Western economists who have studied the program. China is not giving aid, they say, but is asking countries to assume debt from Chinese banks to pay for the infrastructure.

Some officials from the United States and Western Europe contend that China is spending abroad and corralling others to join it while keeping important sectors of its huge market at home off limits to foreign investors.

"The opening up of China for foreign businesses is still timid," said Joerg Wuttke, the former head of the European Chamber of Commerce in China.

Hours before Mr. Xi was to speak, North Korea fired an intermediate-range ballistic missile.

Some delegates interpreted the test launch, the first since a new president took office in South Korea, as a deliberate effort to embarrass Mr. Xi.

Chinese news media were ordered to take down coverage of the launch an hour before Mr. Xi's speech, Chinese reporters said. Then, 30 minutes before Mr. Xi was to to speak, the delegations from North Korea and South Korea met briefly, said a South Korean diplomat who spoke only on the condition of anonymity.

It was fairly normal procedure, the diplomat said, for those delegations to meet at international gatherings. Still, the encounter seemed to symbolize China's interest in arranging talks on the North among all the parties, including the United States.

The South's Yonhap news agency reported that Park Byeong-seok, a senior member of the Democratic Party of Korea, told the North's delegation that his government "strongly objected" to the missile test.

The presence of the North Korean delegation, led by Kim Yong-jae, the minister of economic relations, at a highly choreographed event drew criticism from the United States Embassy in Beijing.

The Trump administration has asked China to exercise pressure on the North but it is unclear what China has done to further cut its economic ties.

At Mr. Xi's invitation, President Moon Jae-in of South Korea sent Mr. Park to the forum, a spokesman for the South Korean leader said.

The two leaders shared a phone conversation on Thursday, days after Mr. Moon was elected, setting the stage for tense relations between the countries to improve.

Mr. Park is expected to meet a former foreign minister of China, Tang Jiaxuan, in Beijing on Monday, South Korea said.

Those talks would probably center on China's strong opposition to the deployment of an American missile defense system, known as Thaad, in the South, and how Mr. Moon plans to walk a fine line between the United States, its security guarantor, and China, its biggest trading partner.

The Chinese Foreign Ministry criticized the North's missile launch, saying in a statement that it violated United Nations Security Council resolutions and asking for restraint.

[Source: By Jane Perlez and Keith Bradsher, The New York Times, Beijing, 14May17]

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small logoThis document has been published on 22May17 by the Equipo Nizkor and Derechos Human Rights. In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes.