China launched its Go West development drive last month. Essentially, it calls for more development in Central and Western China so that the country can push back against the effects of political isolation, SCMP reported.
Under the plan, China will seek to focus on its domestic market rather than rely on an unpredictable and politically sensitive post-coronavirus world.
Uyghur muslims in China praying in the far Western Xinjiang province.
Some parts of the plan will see development in new transport infrastructure such as high-speed rail links and new airports in the country’s western regions, SCMP adds, while others will focus on new domestic energy projects.
Such economically underdeveloped regions in China include those that stretch from Inner Mongolia in the north to Tibet in the west, SCMP said.
“The strategic importance of the western regions was elevated after Covid-19. China wants to strengthen its influence in Central, Western and Southeast Asia for national security reasons and to protect China’s central position in global supply chains,” said Dan Wang, an analyst at the Economist Intelligence Unit in Beijing.
The plan will see China seek to gather investment from foreign firms in order to help it develop its inland regions, and this is where the plan is facing hurdles.
A security facility in Xinjiang, China, believed to be a Muslim detainment camp.
SCMP reports that the project has not captured much interest from foreign firms already based in China.
Allison Sherlock, China researcher at the Eurasia Group, told SCMP that investors are suffering from “regional development plan fatigue”.
And Companies may be put off investing money into regions of China such as Xinjiang, Tibet and Ningxia where the country has been accused of human rights abuses on a wide scale, SCMP adds.
Indeed, US President Donald Trump last week signed the Uyghur human rights bill which aims to punish China for human rights abuses against its Uyghur Muslim population.
READ: Trump signs bill calling for fresh sanctions for China over ‘human rights abuses’
Foreign investers seem put off by investing in China’s western regions, reports claim.
The US has estimated that over a million Muslims have been detained in internment camps by the Chinese government, putting forward shocking claims regarding their treatment there including sexual abuse and torture, CNN reports.
There is a lot happening at once considering a global economic contraction, the still-developing Covid-19 pandemic, and a political landscape that is tense for a number of reasons.
For example, the US Senate passed legislation last month that could block Chinese companies from listing on American stock exchanges or raising cash from US investors.
That is, unless they abide by audit standards that have been set out by the US government.
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Part of China’s plan to develop the western regions is to establish high-speed rail networks there.
Technically the law could apply to any foreign nation that wants to be listed on US stock exchanges or raise US funds, but lawmakers said that the move was targeted towards China, CNBC reported.
Another US step that limits Chinese business on its soil is the Huawei ban.
The Trump administration extended an executive order last month that prohibits US businesses from working with companies that pose a national security risk.
As such, the order effects Chinese smartphone and telecoms giants Huawei and ZTE.
Tibet is part of China’s western region.
This has far-reaching implications for Google, for instance, since it therefore cannot provide Huawei with access to its services such as Google Maps, according to the Independent.
Only yesterday, the US Defense Department determined that Huawei was backed by the Chinese military, along with 19 other Chinese firms.
It came as part of a list published by the department that identified such firms in order to inform US businesses and investors.
The BBC reports that that it could lay the foundations for fresh US sanctions against the companies identified in the list.
The Go West programme follows a similar plan initiated by the Chinese government around 20 years ago called the western development programme.
Gong Gang, an economics professor at Yunnan University of Finance and Economics, told SCMP that China “needs to embrace the belt and road countries, developing countries, and form a new system centred on itself”.