NEW DELHI ¨C You may not have noticed, what with the outbreak of trade war with the United States and all, but China¡¯s economic diplomacy has had a bad few weeks. The country¡¯s flagship ¡°Belt and Road¡± initiative is dealing with ever-greater resistance, slowing a momentum that once seemed unstoppable. In fact, I¡¯d argue that the BRI is stalled.
The clearest sign of this, perhaps, was the news that Malaysia had halted Chinese projects worth $22 billion, including a controversial rail link along the country¡¯s east coast. The decision looked inevitable after May¡¯s elections.
One of the pillars of Prime Minister Mahathir Mohamad¡¯s successful campaign to unseat Najib Razak was the charge that Najib¡¯s close links to China had bred corruption and bad decisions. Mahathir¡¯s associates linked the scandal at the 1MDB development fund to BRI financing, while Najib¡¯s associates doubled down, putting Chinese President Xi Jinping on their party posters. One Malaysian politician complained visitors might have thought Xi himself was on the ballot.
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