The rise of Hainan

The Boao Forum for Asia and the increasing strategic and economic importance of Hainan Province-112

The rise of Hainan

The Boao Forum for Asia (BFA), which was formed in 2001, draws top world leaders, heads of multilateral institutions and academics. It has been dubbed the “Summer Davos” and has begun to draw attention due to China’s increasing economic clout and heft on the global stage.  

For this year’s forum, held in the coastal town in Hainan province on March 26-29, Chinese President Xi Jinpingwas absent as he was travelling to Europe, and many other senior Chinese officials were in Beijing in connection with the trade negotiations with the US. In 2018 Xi was center stage, along with a host of officials, and there were a number of other high profile attendees, including International Monetary Fund Managing Director and Chairwoman Christine Lagarde.

There is a general perception that last year’s forum was given more importance, apart from the presence of Xi and other senior Chinese officials it received greater coverage. Significantly, Xi’s address was covered on Chinese Television, while Prime Minister Li Keqiang’s keynote address was not televised.

The Chinese prime minister reiterated Beijing’s support for a multilateral trading system, while pitching for reforms in the World Trade Organization (WTO).  He also outlined some of the key reforms China is undertaking and flagged some of the steps being taken for encouraging foreign direct investment (FDI). Li also said Beijing would take specific steps for opening up sectors such as  transport, infrastructure, telecommunications, medical care and education. 

Ever since US President Donald Trump has adopted insular, America First policies, China has been trying to send the impression that, unlike Washington, it is in favor of globalizationand free trade. This was evident during last year’s World Economic Forum held at Davos and also last year’s Boao forum.

“We will never threaten anyone, nor overthrow the existing international system,” he said.

Xi also dispelled the notion that China was seeking to build spheres of influence. But he also said he would contribute to world peace and that Beijing would seek to be“a contributor to global development and a defender of international order.”

Boao Forum, BRI and East Asian politics

The forum was important, not just from the standpoint of Beijing highlighting some of its key economic policies, but also in the context of the Belt and Road Initiative (BRI), and the future of the Japan-China relationship.

Importantly, Sri Lanka spoke in favor of the BRI.  The Hambantota Port project, which has been handed over by Sri Lanka to Chinese companies for a period of 99 years,has contributed to Colombo’s rising debt to China and has been cited as an instance of Beijing’s debt trap diplomacy.

The South Asian nation was represented by Rajith Keerthi Tennakoon,Governor of Southern Province. Chinese media highlighted this aspect of the forum

With regard to closer cooperation between Japan and China in third countries, Hiroshi Nakaso,chairman of the Daiwa Institute of Research and former deputy governor of the Bank of Japan (BOJ), said the currency swap of October 2018 would promote third party cooperation between the private sectors of both countries. 

The second development is particularly interesting, because, on the one hand, Tokyo is seeking to provide an alternative to BRI through the PQI (Partnership for Quality Infrastructure), but on the other it is also willing to cooperate where necessary. 

Increasing relevance of Hainan

The forum also used to strengthen ties between China’s Hainan region and neighboring countries, but also to send a clear message - that it is a key player within the BRI.

Hainan, which was declared China’s 12thFree Trade Zone in 2018, is important for a number of reasons. It is strategically located, and is an important component of the BRI, as was emphasized by senior officials during the recent forum.

Between November-2018 and March 2019 it has received over US$27 billion in investment.

Hainan’s role in BRI and ties with Asean countries 

Looking at Hainan-Association of Southeast Asian Nations (Asean) ties, the Asean-China Governors/Mayors' Dialogue has played a key role in bolstering links between Hainan and Southeast Asian countries. Trade between Hainan and Asean was estimated at over US$12.5 billionfor 2018 (the Asean bloc was Hainan’s single largest trading partner). Apart from economic linkages, Hainan has strong connectivity with Asean. 

On December 29, 2018, the Hainan-Singapore Asean liner route was launched, with theroute’s launchco-hosted by the provincial government of Hainan and China Ocean Shipping Company (COSCO) Shipping. As a result, the Yangpu Port in Hainan has become a gateway between China’s western regions and Singapore. Hainan province has thus emerged as an important pivot of the New International Land-Sea Trade Corridor (ILSTC) (also known as the Chongqing Connectivity Initiative). 

There are a number of cruises from Hainan to Asean countries – such as Vietnam and the Philippines.To harness its crucial geographic location, there is likely to be an emphasis on air connectivity between Hainan and not just Asian countries in the neighborhood, but also Africa, Europe and Oceania. During this year’s Boao forum the theme of the ASEAN-China Governors/Mayors Dialoguewas "Asean-China Connectivity and Hainan Free Trade Port." 

Hainan, of course, seeks to expand its cooperation with Asean countries, and not restrict it to just the economic sphere and connectivity. 

Wang Sheng, director of the Hainan’s Foreign Affairs Office,  said it would explore greater collaboration in areas suchas“health, blue economy, tourism, culture, education, technology, tropical agriculture and seed production.”

Seed cooperation, for instance, is another area in which Hainan’s cooperation with neighboring Asean countries has witnessed a rise. Hybrid rice seeds cultivated by scientists at the Nanfan Scientific and Research Breeding Base in Hainan are being introduced not just inAsean countries, but South Asia as well(5,50,000 hectares of hybrid rice have been cultivated in the Philippines, Indonesia, Vietnam and India). 

To bolster the overall aim of this, officials from both sides signed an agreement to strengthen the strategic partnership between Asean and China. 

Conclusion:

Beijing obviously uses the Boao forum as a tool for furthering its views on global economic and foreign policy issues. It has been receiving more attention in recent years due to President Trump’s isolationist policies. China, by appointing a high profile individual like Ban Ki Moon, Former Secretary General of the United Nations, as President of the Boao Forum for Asia in April 2018, has further enhanced the prestige of this event.

Second, it is interesting to see that international events and forums are not restricted to either Shanghai or Beijing. A large number of events, such as the G20 and Shanghai Cooperation Organization are organized outside the big cities, helping to raise the profile of these cities. Recent examples include the 2016 G20 Summit held in Hangzhou (Zhenjiang); the Brazil, Russia, India, China Summit (BRICS) Summit of 2017 at Xiamen (Fujian Province); and the SCO Summit 2018 held at Qingdao. 

Even if one were to look beyond the symbolic aspect, a number of other points emerge.

First, that Chinese provinces conduct their external outreach in a well thought out manner based on geographical location and synergies. For instance, while Hainan is seeking to build links across the world, its thrust has been on neighboring countries within Asean, evident from its trade and connectivity initiatives. The fact, that each province has been empowered to strengthen not just commercial linkages, but also enhance people to people ties, and has designated provincial officials to facilitate outreach, is also beneficial.

Second, linkages between Chinese provinces and other countries are not restricted to economics and connectivity, so as to send out a message that Chinese provinces want to build links by utilizing soft power. This is also important, because it will dispel notions with regard to the Belt and Road Initiative. 

Tridivesh Singh Maini is a New Delhi based policy analyst associated with The Jindal School of International Affairs, OP Jindal Global University, Sonipat, India



You need to login to write a comment!