Viable policy coordination crucial for next phase of CPEC, moot told

ISLAMABAD: Speakers at a seminar while spelling out critical steps for the completion of the second phase of the China-Pakistan Economic Corridor (CPEC) have said that viable policy coordination, system connectivity, financial integration and people-to-people contacts will be crucial to implement next phase of the CPEC.

They said this here on Wednesday while speaking at a seminar titled, “Reforms Agenda for CPEC 2.0: Opportunities and the Way Forward” under its Green CPEC Alliance jointly organised by the Sustainable Development Policy Institute (SDPI) and the Pakistan China Institute (PCI).

CPEC was the pilot and flagship project of the Belt and Road Initiative (BRI) under the commitment of Pakistan-China leadership, whereas, after successful early harvest projects, the BRI has evolved and a number of countries wanted to become part of it, they observed.

They said CPEC is the pillar of the BRI launched by President Xi Jinping which is undoubtedly the diplomatic and development initiative of the Century encompassing Asia, Africa, and beyond. The BRI has brought nations of the world together, whereas, the CPEC is the manifestation of Chinese confidence in Pakistan as China came to help Pakistan at a critical stage when the country barely had any other nation’s support.

Speaking on the occasion, Wang Shengjie, Head of Political and Press Section, Embassy of People’s Republic of China, said that it is necessary for the stakeholders to understand the upgraded version of the CPEC, the guidance of the leadership of the two counties and synergizing policies to achieve its successful completion.

He mentioned that the Chinese government has proposed 5C or Five Corridors framework highlighting corridors of growth, livelihood enhancement, innovation, green corridor and the open corridor. Dr Shengjie said it is a more strategic phase with many technical parts, whereas the Chinese government is mulling over to unite the 5C framework of China and 5E of Pakistan. “We are also planning to get Chinese experts in Pakistan to develop special economic zones (SEZs) who would study the current situation and figure out a suitable roadmap for developing Pakistan’s SEZs,” he said.

Dr Abid Qaiyum Suleri, executive director SDPI said Pakistan and China can collaborate to explore the untapped potential of “Green Minerals” under the CPEC as it is the future fuel of the world, saying that the countries need to consider challenges along with opportunities as both have a common denominator of extreme weather and climate change across the region and the world.

The revised trade regime is another challenge after the implementation of the Carbon Border Adjustment Mechanism (CBAM) by the European Union (EU) to report carbon emissions in the supply chain of its exports whereas US and China are working on it, he said. Suleri noted that there is a lack of indigenous infrastructure and capacity to document and gauge carbon emissions at every sector level.

“Going green means replacing conventional methods of production and businesses to offset carbon emissions. The increased tariff on China’s green energy transition technology due to the efficacy of these solutions is another challenge as the competing nations are increasing tariff on it to protect their local manufacturers,” he said.

Green metals, he said are another important component including nickel, cobalt, lithium and other that will help in EV batteries’ development that can be explored under CPEC 2.0. “Green diplomacy is another important tool that needs to be scaled up for borderless promotion of green technologies and transfer of technology,” Suleri said.

Executive Director PCI Mustafa Hyder Sayed said Pakistan needs policy coordination with clear reforms along with relevant bankable feasibility studies to succeed in the second phase of CPEC. Sayed said Pakistan needs to reflect on its competitiveness under CPEC in BRI as the country is competing with the world and it has to review its demands to China like Green Corridor or Greening of CPEC and also its capacities to handle such mega projects.

Mustafa Hyder said the country would have to realise and materialise foolproof security for the Chinese and it also needs to develop a joint working on green energy transition under the CPEC. “Pakistan and China want to be the regional hub of connectivity from North to South and East to West that has contrasting visions of connectivity and cooperation that includes all and conversely there is a negative vision of new cold war and curtailment, and we reject that vision as 21st century cannot support zero minus sum vision. It’s connectivity and CPEC is the way forward. The next decade will be more successful as the best part of the CPEC is yet to come,” he said.

Dr Khalid Waleed, energy expert SDPI briefed on CPEC and the energy projects said that the energy projects under CPEC are facing critical discourse due to the climate change debate, economic turmoil and financial crisis in energy projects demanding review of existing schemes.

“Pakistan’s carbon emissions in the energy sector are seven times more than EU which will create a serious challenge for Pakistan under CBAM, whereas, reforms are required for greening the investment of CPEC along with establishment of renewable energy diplomatic task force, B2B Green Alliance, and Sino-Pak Clean Energy Partnership,” Dr Waleed said.

During the panel discussion, Private Power and Infrastructure Board (PPIB) Ministry of Energy (Power Division) Managing Director Shah Jahan Mirza said during the first phase of CPEC, the country got $17 billion funding alone in the energy sector that was invested in coal, renewable and hydropower projects.

He said the second phase of CPEC demanded the Pakistan government to come up with prudent and effective planning to avoid any failure in the power sector. Mirza underlined that the government’s focus was on business-to-business engagement after completion of the government-to-government initiatives under the first phase of CPEC.

The country, he said, would develop numerous renewable energy projects under the CPEC second phase, whereas, it also demanded formulation of robust feasibility studies to ensure bankable investment projects.

NA Zuberi, senior advisor China Three Gorges South Asia Investment Limited, while highlighting the key concerns of the Chinese firms working under CPEC and the way forward to achieve successful completion of the second phase of CPEC, said frequent policy changes, cumbersome administrative procedures, bureaucratic hurdles, no framework for land acquisition, and security were the key challenges.

The way forward, he said is to develop a detailed roadmap for each sector, security plans should be done in consultations with Chinese companies, strengthening of Pak-China collaboration, capacity building of Pakistani institutions, technology and knowledge transfer, robust monitoring and evaluation, public awareness and engagement, and environment sustainability.

Copyright Business Recorder, 2024