Belt up

Belt up

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OBOR is one of the strangest names ever created for a project. It has an albatross-like feel to it, with the effort working in spite of the name. BRI - Belt-Road Initiative - is not a bad alternative, but doesn't seem to be gaining any traction. So we have OBOR, and if enough money is pumped into it, who wouldn't accept it?

As to OBOR deals, however, the news this week has been mixed. Two major OBOR-related deals have been cancelled, in both cases apparently because the terms were not considered by the "recipient" country to be fair and equitable. The South China Morning Post, which remains vastly better than it was expected to be after the Jack Ma buyout, said that Pakistan had canceled a US$14 billion hydroelectricity dam deal with China "because it could not accept the hyper strict conditions." The funding conditions for the Diamer-Bhasha dam were not doable and against our interests," the Pakistan newspaper Express Tribune quoted Water and Power Development Authority chairman Muzammil Hussain as saying. Pakistan says it will go ahead with the dam using its own financing.

Earlier in the week, Nepal backed out of a similar US$2.5 billion hydro dam arrangement. There have long been questions about the commercial viability and the financial and other terms of some OBOR projects, but investment and infrastructure construction is generally good and welcome, as long as the strings attached are not onerous. The US and Europe are surely not going to be building rail lines across the Euro-Asian landmass, and China has the capabilities, the funds and the strategic desire. It depends on whether OBOR is basically "aid" or more an umbrella term for commercial infrastructure projects implemented at market rates.

OBOR looks to be an acronym we will be dealing with for years to come, but this week was a reminder that it's not necessarily going to be always a smooth ride. All the best for a pleasant weekend!