Webcast: Europe's Issues With the "Belt and Road"
In Conversation With Jörg Wuttke, President of the European Chamber of Commerce in China
To what extent are European businesses and countries involved in China's Belt and Road Initiative (BRI)? Is there a unified approach beginning to emerge from geographical Europe? How can BRI be reformed into a multilateral development initiative that is open and transparent? What sort of mechanisms are needed to guarantee an open market? Markus Herrmann of Sinolytics discussed these questions with Jörg Wuttke, President of the European Chamber of Commerce in China, which has recently released a report on the subject.
Our Key Takeaways
Jörg Wuttke said he was surprised himself by how negative the feedback from surveyed European companies was: Only very few of them stated that their business would benefit from the BRI. Many see the BRI mainly as a way to create demand for Chinese companies.
At its core, the BRI is a "hub-and-spoke model" with China at its center, argued Jörg Wuttke: The relationships are always bilateral, and never multilateral. For Wuttke, it's telling that the Chinese-led Asian Infrastructure Investment Bank (AIIB), a multilateral development bank, so far has only been involved in very few BRI projects, and recently even has been outbid for a project by another Chinese development bank.
"Europe has no narrative", Wuttke said about the European Connectivity Strategy, which is often portrayed as a counterbalance to the BRI, but is not widely known. Similarly, Japan is actually the biggest investor in Southeast Asia, not China.
The coronavirus pandemic, and the recession it might trigger in countries around the world, could mean that BRI will face more difficulties than in the past. Jörg Wuttke noted that there's also plenty of skepticism towards the initiative among Chinese companies: Many see it as a political initiative, not something that will help their business.
Jörg Wuttke is President of the European Union Chamber of Commerce in China. He currently serves as Vice President and Chief Representative of BASF China, based in Beijing. Since joining BASF in 1997, Mr. Wuttke has been responsible for helping guide the company’s investment strategies for China, negotiation of large projects and government relations. Before, Mr. Wuttke worked with ABB for eleven years in different positions, among others, in Beijing and Shanghai. From 2001 to 2004, he was the Chairman of the German Chamber of Commerce in China, and from 2011 to 2019, Chairman of the Business and Industry Advisory Committee (BIAC) China Task Force of the BIAC to the OECD. From 2013 to 2016, and again since 2019 Mr. Wuttke is Vice Chairman of the China Petroleum and Chemical Industry Federation (CPCIF) International Cooperation Committee, a group representing Multinational Companies in China’s Chemical Association.
Markus Herrmann, Director and Managing Director Switzerland of Sinolytics, is an experienced advisor to European corporate and public sector clients focusing on business-policy nexus topics including regulatory ratings/CSCS (Chinese Government’s system to monitor and guide companies’ behavior), the BRI, policy-based growth strategies, technology transfer- and partnerships or government affairs strategies. He combines deep business understanding with policy analysis expertise and six years working experience in China. Prior to Sinolytics, Markus worked as a Government Affairs & Advocacy Director with Bayer MaterialScience (now: Covestro) in China and as Management Consultant with The Boston Consulting Group in its Shanghai, Hong Kong and Zurich offices, focusing on financial services and industrial goods. Markus holds a MLaw from the universities of Bern and Geneva with focus on international public law and WTO law as well as a CAS in Public Policy from ETHZ.