Beijing’s BRI isn’t in retreat and ‘debt trap’ warnings are falling on deaf ears in the Global South

It’s shifting from financing megaprojects to becoming a long-term development partner, particularly for fast-growing economies in the Global South. Washington and its partners cannot afford to be complacent if they want to stay relevant in countries that will drive growth in the future.

Fresh data shows China’s new reach. Engagement last year was at its highest since the BRI began in 2013. It clocked up $128 billion in construction contracts and about $85 billion in investments. Energy related projects alone reached nearly $94 billion, more than double the year before.

Just as important as the headline number is where the money is going. Investment is increasingly concentrated in renewable energy, battery supply chains, mineral processing and industrial manufacturing. These sectors help strengthen the resiliency of supply chains, which are priorities for Beijing as it tries to gain the upper hand in its rivalry with Washington.

Africa, notably, emerged as a top destination, with Nigeria and the Republic of Congo among the major recipients. China is pairing that investment with expanded trade access. Recently, it announced zero-tariff treatment for imports from 53 African countries starting 1 May. For governments seeking growth and opportunities for their vast populations, that combination is difficult to ignore, especially when US trade policy is so unpredictable.

It was not long ago that many analysts and Western governments believed Beijing might scale back the initiative. Yet after slowing during the pandemic, activity has rebounded over the last few years. This new phase signals China’s confidence at a time of trade friction with the US and mounting wariness over Beijing’s ambitions.

Infrastructure and trade are never just about concrete or commerce. These relationships, when executed well, create interdependence. The BRI’s refreshed version is helping China cushion against wider geopolitical uncertainty.

When Xi first outlined his idea for a “new Silk Road” in 2013, he presented it as a connectivity project. The ambition was to build roads, railways, ports and power plants that would link China to Eurasia, Africa and beyond. Eventually, the initiative expanded to more than 150 countries and exceeded $1 trillion in deals, according to several estimates.

But those early years were defined as much by controversy as by scale. The plan faced criticism over debt sustainability and environmental damage—accusations Beijing rejects. Projects such as Sri Lanka’s Hambantota Port became known as white elephants, even if the reality is more complex than that.

The BRI’s latest incarnation is more closely targeted—and in many ways, more strategic. It needs to be. Despite the prospect of a rapprochement in coming months when Xi is expected to meet US President Trump, the pressures go beyond trade. China’s military modernization and embrace of Russia have heightened suspicions, with Western officials saying Beijing increased support for Moscow’s war in Ukraine last year. At home, growth is sluggish and demand remains subdued.

Against that backdrop, it is hardly surprising that Beijing is pushing for closer ties with the Global South. For Western governments, this presents a more complicated challenge than the BRI’s first phase. Those who continue to frame it primarily as a debt trap may be fighting yesterday’s battle. Beijing has adjusted its model. Nor should the objective be containment for its own sake. The more realistic goal is to prevent the programme from becoming the only game in town for the Global South.

That means doing two things at once: Offering a partnership to nations in the Global South, while concentrating on strategic sectors such as critical minerals, digital infrastructure and energy systems. That task becomes more urgent as Washington pulls development spending and reassesses its overseas commitments, creating openings that Beijing is quick to fill.

There are areas where China’s strategy remains vulnerable and other governments would be smart to highlight those in order to stay relevant as Beijing forges ahead with its BRI. Transparency concerns persist, as Indonesia’s Jakarta-Bandung high-speed rail project has demonstrated, with delays and cost overruns that have triggered scrutiny.

The BRI’s recent resurgence does not demonstrate that China’s economic model is unstoppable. But it does show that Beijing isn’t retreating from global engagement. It is simply adapting. ©Bloomberg

The author is a Bloomberg Opinion columnist covering Asia politics with a special focus on China.