China’s Maritime Silk Roads Initiative and Southeast Asia: Rough Sailing through the South China Seas?

As our readership knows, one of China’s signature foreign policy initiatives is the Maritime Silk Road Initiative (MSRI), a key part of its larger One Belt, One Road (OBOR) scheme. If fully accomplished, the MSRI has the potential to vastly increase hard (e.g., land and sea) and soft (e.g., legal, policy, and people-to-people) connections within Southeast Asia, including the South China Sea (SCS) space, and to transform regional politics, all with great import for multinational corporations (MNCs) from within and outside the region. Building upon last year’s conference that delved into the political economy of the MSRI and South Asia, the Wong MNC Center organized an event this year probing the political economy of the MSRI and Southeast Asia. Conference speakers showed that the implementation of the MSRI in Southeast Asia faces many of the same domestic and international political and economic challenges as does the realization of the MSRI in South Asia. In the Southeast Asian case, though, the relevant territorial and maritime issue is the contentious SCS controversy, which involves, in various ways, the Philippines, Vietnam, Indonesia, Malaysia, Japan, and the United States. If this dispute, for whatever reason, escalates then it is very difficult to imagine the MSRI reaching its full potential in MSRI and many projects could be disrupted. The SCS is not the only challenge for the MSRI in Southeast Asia, however. Domestic political problems in Malaysia, Myanmar, and elsewhere may hinder the realization of the MSRI and China must ensure it is attentive to the Association of Southeast Asian Nations’ institutional concerns about the impact of the MSRI on its programs and regional prominence, too. For their part, MNCs must be attentive to the aforementioned issues in their strategic planning and their pursuit of MSRI opportunities if they are to avoid potential rocky seas.