The Challenge to the Challenge: The Belt and Road Initiative’s Implications for Liberal Trade and (Digital) Finance and the Response in Other Countries


  • This SCRITPS project considers the implications of the Belt and Road Initiative (BRI) for the liberal script. It focuses on two policy areas, namely trade and finance. Both are critical for the potential re-allocation of wealth across borders. The project investigates how governments respond to the challenge of the BRI, and what explains the variation in responses.
    DFG, 2020-2024


    Team

    Nora Kürzdörfer

    Doctoral Researcher

    Felix Garten


    Leitung

    Prof. Dr. Mark Hallerberg


    Forschungsfragen

    The project is part of the Cluster of Excellence SCRIPTS (Contestations of the Liberal Script) at FU Berlin. It investigates the following main questions:
    - How do governments respond to the challenge of the BRI?
    - What explains the variation in governments’ responses to the challenge of the BRI? - How does the BRI challenge a liberal trade system, and a liberal capital regime?

    Beitrag zu internationaler Forschung

    There is a growing literature that considers how to interpret the BRI’s implications for the rest of the world. Much of the work focuses on the implications from a strategic perspective, with Japan, India and the United States considering the BRI as a general threat, and the provision of 5G by Huawei as a specific strategic threat. The European Union has entered somewhat belatedly into this debate, with the BRI already a part of its geography with the 16+1 initiative. This project discusses the contestation of the liberal script at the international level for two policy areas: trade and finance by focusing on the nature of the contestation that comes from China’s BRI. After defining the nature of the challenge, the project analyses “the challenge to the challenge” in trade and (digital) finance from three sets of actors: the European Union, major emerging market economies, and small emerging markets.

    Forschungsdesign und Methoden

    The project is envisioned with a bipod structure.

    1. Documenting and defining the nature of the challenge to the international liberal script

    This project considers the implications of China’s Belt and Road Initiative for the liberal script. Researchers focus on two policy areas, namely trade and finance. Both are critical for the potential re-allocation of wealth across borders. They begin with a definition of the script in this area. The liberal script prescribes free markets and free-moving capital. The project discusses the international arenas, which are generally international organizations, where conflicts over these issues play out.

    The research team uses the first part of the project documenting, and defining, the nature of the challenge to the international liberal script. To document the challenge at the international organization level, they will conduct expert interviews at the WTO and in the OECD. To document the challenge from below, they will interview consumers and firms that work on the BRI outside of China. They will also interview Chinese officials and rely on Chinese secondary sources to document the nature of the challenge from the Chinese side.

    2. Documenting and explaining the challenge to the challenge

    After defining the nature of the challenge, the second part of the project will document, and explain, the challenge to the challenge in trade and (digital) finance. The research team focus on three sets of actors—the European Union, major emerging market economies, such as Brazil and India; and small emerging markets, which on their own cannot respond to the Chinese initiatives.
    In terms of the “challenge to the challenge”, they expect that at least four topics will be important: a) new industrial policies to update trade and tax digitalization, b) types of coalitions, c) narratives for different audiences, and d) reforms of existing international organisations or building of new regimes. To explore these four topics, the team will delve into questions of domestic political economy, as well as international institutions and negotiations.

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    13.07.2021

    The Challenge to the Challenge

    SCRIPTS Cluster of Excellence "Contestations of the Liberal Script" Berlin: 13.07.2021

    Prof. Amrita Narlikar presented together with her Chal-Chal team their project at the SCRIPTS Jour Fixe. The research team looks at the Belt and Road Initiative’s implications for liberal trade and (digital) finance, as well as the responses to the BRI in other countries.

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