Abu Dhabi, UAEFriday 24 May 2019

UAE Vice President meets China's Xi Jinping as Belt and Road event begins

Sheikh Mohammed bin Rashid is in Beijing for China's 'project of the century' initiative

As China opened the second major conference on its flagship Belt and Road initiative, Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, held talks with President Xi Jinping and reaffirmed the UAE’s commitment to helping build the “next phase for the global economy.”

The Beijing meeting is bringing together heads of states from 37 nations across the Middle East and the wider world to discuss ways to expand and develop the Belt and Road initiative – one of Chinese President Xi Jinping's signature policies.

It combines an "economic belt" on land and a "maritime silk road" to link China with South-East, South and Central Asia, the Arabian Gulf, North Africa and then Europe.

By building millions of miles of railroad, laying thousands of roads and digging dozens of ports, China is looking to develop inter-continental trade as it seeks to secure its economic growth.

The massive undertaking, launched six years ago, is expected to attract investments of more than $1 trillion and will help to propel China towards becoming the world’s largest economy.

Last year HSBC bank said China could overtake the US by 2030.

The UAE has been an active player in the project, using its sophisticated infrastructure to create a centre for trade to the region and as a gateway to Africa and the wider Middle East.

Trade between the UAE and China rose by 15 per cent to $52 billion in 2017, making China one of the UAE’s biggest trading partners.

“I reaffirmed the UAE's optimistic outlook and strong collaboration on the next phase of the global economy,” Sheikh Mohammed said in a tweet on Thursday as China was set to display the “project of the century” in the three-day summit this week.

Sheikh Mohammed also met Chinese Premier Li Keqiang to talk about investment opportunities from the Belt and Road initiative and ways to enhance relations between the UAE and China.

They discussed development projects in culture, tourism, education and the economy.

Sheikh Mohammed also met Egyptian President Abdel Fattah El Sisi, who is attending the summit, to discuss regional matters.

The two countries have close ties and the UAE has helped to support Egypt in recent years as Mr El Sisi undertakes a major overhaul of the economy.

Plans in development include mega projects such as a second Suez Canal, and building cities including a new capital.

Discussions centred on ways to develop political and economic co-operation, boost sharing of technological skills, and exchange experiences in public works and economic development, the state news agency Wam reported.

Among the other world leaders to attend the summit are Russian President Vladimir Putin and Italian Prime Minister Giuseppe Conte.

Italy became the first developed European nation to sign up to the project this year when it signed 29 deals worth $2.8bn.

While China says the project is about making an interconnected community to enhance trade, there have been concerns that some countries were taking on unsustainable loans to build infrastructure projects for the Belt and Road.

In some cases, nations have struggled to service debt for the projects.

In 2017, Sri Lanka formally handed control of a strategic port on its southern coast to China on a 99-year lease to clear debts the country took to build the site.

The deal drew criticism at home with trade unions calling it a sell out.

The US has been vocally critical of the project, with Vice President Mike Pence describing it last year as “debt diplomacy”.

But on the first day of the Belt and Road summit, Chinese Finance Minister Liu Kun said Beijing aimed to make the massive undertaking as sustainable as possible.

Mr Liu said it was important to prevent the pitfalls associated with heavy borrowing for development projects.

The comments drew praise from International Monetary Fund director Christine Lagarde on Thursday.

Ms Lagarde praised the efforts by China to address debt risk.

From Bejing, she said that better capital flows across borders and higher financial inclusion with the help of new technology, called FinTech, could help the undertaking.

“China’s increased focus on the long-term success of Belt and Road Initiative projects, and the announcement by Fi­nance Minister Liu of a debt sustainability framework, are very welcome steps in the right direction,” Ms Lagarde said.

“Making progress on major in­frastructure needs will require capital flows to rise again and to be managed safely."

Sheikh Mohammed was accompanied by Reem Al Hashimy, Minister of State for International Co-operation, Dr Anwar Gargash, Minister of State for Foreign Affairs, Mohammed Al Gergawi, Minister of Cabinet Affairs and The Future, Dr Sultan Al Jaber, the Minister of State and chief executive of the Adnoc Group, and Sultan Al Mansouri, Minister of Economy.

The delegation also includes Sheikh Ahmed bin Saeed Al Maktoum, chief executive of the Emirates Group, and Khaldoon Al Mubarak, Chairman of the Abu Dhabi Executive Affairs Authority and chief executive of Mubadala, the strategic investment arm of Abu Dhabi.

Updated: April 26, 2019 02:24 AM

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