China: OBOR hard to ignore - Rabobank

Michael Every, Senior Asia-Pacific Strategist at Rabobank explains that China’s OBOR huge scale and equally huge budget easily grab their attention, but there is scepticism --and pushback from India over the project.

Key Quotes

“European and US railway history has lessons for us in that regard.”

“US railroads saw violent struggles to control monopoly routes and push-backs when they did.”

“National security concerns also played a key role in the 19th century European experience.”

“The economics also look very odd: more White Elephant than Asian Tiger.”

“In short, OBOR is as likely to be as a bumpy ride as it is a smooth journey.”

“One would be hard-pressed to ignore China’s One Belt One Road (OBOR) “project of the century” to link it by road and rail with South-East, South, and Central Asia, Russia, and Europe, and to build a ‘Maritime Silk Road’ to Africa. Its epic cross-continental scale and ambition, enormous price tag of USD900 billion to USD4 trillion --and matching level of publicity-- grabs the eye. That’s even more the case in a world starved of capital spending and short of global leadership.”

“Chinese inward infrastructure investment or related loans are already flowing into many of the 68 countries under the OBOR umbrella, from Australia and Bangladesh to Zanzibar, while many others are close to moving from the drawing board to actual construction.”

“Nonetheless, one would be hard-pressed to ignore that there is as much scepticism about OBOR outside China as optimism within it.”