Shanghai Municipal Commission of Commerce Belt and Road Countries Investment Index Report 2018 1 Foreword

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Shanghai Municipal Commission of Commerce Belt and Road Countries Investment Index Report 2018 1 Foreword Shanghai Municipal Commission of Commerce Belt and Road Countries Investment Index Report 2018 1 Foreword 2018 marked the fifth year since International Import Exposition Municipal Commission of Commerce, President Xi Jinping first put forward (CIIE), China has deepened its ties releasing the Belt and Road Country the Belt and Road Initiative (BRI). The with partners about the globe in Investment Index Report series Initiative has transformed from a trade and economic development. to provide a rigorous framework strategic vision into practical action President Xi Jinping has reiterated at for evaluating the attractiveness during these remarkable five years. these events that countries should of investing in each BRI country. enhance cooperation to jointly build Based on extensive data collection There have been an increasing a community of common destiny and in-depth analysis, we evaluated number of participating countries for all mankind , and the Belt and BRI countries' (including key and expanding global cooperation Road Initiative is critical to realizing African nations) macroeconomic under the BRI framework, along with this grand vision. It will take joint attractiveness and risks, and identified China's growing global influence. By efforts and mutual understanding to key industries with high growth the end of 2018, China had signed overcome the challenges ahead. potential, to help Chinese enterprises BRI cooperation agreements with better understand each jurisdiction's 122 countries and 29 international Chinese investors face risks in the investment environment. organizations. According to the Big BRI countries, most of which are Data Report of the Belt and Road developing nations with relatively The Belt and Road Country (2018) published by the National underdeveloped transportation and Investment Index Report 2017 Information Center, public opinion telecommunication infrastructures. attracted attention from and was towards the Initiative has also Moreover, as BRI countries span highly appreciated by a wide range of evolved from suspicion and hesitance Asia, Europe, Africa, Oceania and audiences. In 2018, China's economic to advocacy and willingness to beyond, there are substantial cross- reforms and rising outbound participate, marked by an increase in regional differences in political, social investment prompted us to establish positive attitude towards the BRI from and legal environments, as well as a sound framework to facilitate 16.5% in 2013 to 23.7% by the end of diverse resource endowments and decision making for institutional 2017. industrial development statuses. and corporate investors. This Some countries are experiencing 2018 report refines the evaluation In 2018, China made strides towards political instability, ethnic or religious framework and indicators on the the five BRI policy goals, which conflicts and even extremism and basis of the previous report, and are achieving policy coordination, terrorism. Therefore, investors need covers 80 countries—adding New facilities connectivity, unimpeded to carefully evaluate opportunities Zealand, East Timor, Panama and trade, financial integration, and and identify risks before investing in Madagascar, which recently joined people-to-people bonds. By hosting overseas markets to improve returns the Initiative—to present the latest the successful Boao Forum, Shanghai and operational sustainability. trends and dynamics of the Belt and Cooperation Organisation Summit Road Initiative as a whole and each 2018, Forum on China-Africa Deloitte has researched this topic participating country. Cooperation (FOCAC) and China under the guidance of the Shanghai Table of Contents Section I: Belt and Road Initiative Trends in 2018 1 1. Belt and Road Initiative in 2018: Achievements and Status Quo 1 2. Belt and Road Initiative progress and milestones in 2018 5 1) China has depended trade ties, improved cooperation 5 mechanisms and expanded areas of cooperation with BRI countries 2) BRI countries: rising investment attractiveness and overall risks 8 3) Macroeconomic attractiveness of Southeast Asian countries has 9 grown remarkably 4) Investment risks have increased in Southeast Asian, 9 Central Asian and Middle Eastern countries 5) China playing a more important role in facilitating 9 BRI countries' economic development Section II: Research Methodology 11 1. Objectives and principles of the research 11 2. Summary of BRI countries 12 3. Investment Attractiveness Evaluation Framework 13 1) Macroeconomic attractiveness assessment 13 2) Risk assessment 13 3) Key industries assessment 14 Section III: BRI countries Investment Attractiveness Analysis 16 1. Investment attractiveness analysis 16 1) Macroeconomic attractiveness index 18 2) Investment risk index 19 2. Regional Trends 20 1) Southeast Asia 20 2) Eastern Europe 21 3) Commonwealth of Independent Countries 22 01 4) Africa 23 5) Middle East 24 6) Central Asia 25 3. Key Industries Assessment 26 1) Manufacturing 26 2) IT 27 3) Transportation 28 4) Energy 29 5) Agriculture 30 Section IV: BRI countries Investment Index–Country Analysis 32 1. Southeast Asia 32 1) Singapore 32 2) Philippines 35 3) Laos 38 4) Nepal 41 5) Malaysia 43 6) Brunei 45 7) India 47 8) Bhutan 49 9) Thailand 51 10) Indonesia 53 11) Pakistan 55 12) Vietnam 57 13) Myanmar 59 14) Bangladesh 62 15) Sri Lanka 64 16) Cambodia 66 17) Maldives 68 18) East Timor (Timor-Leste) 70 2. Central Asia 72 1) Mongolia 72 2) Kazakhstan 75 02 3) Turkmenistan 77 4) Uzbekistan 79 5) Kyrgyzstan 81 6) Tajikistan 83 7) Afghanistan 85 3. Middle East 87 1) Israel 87 2) Oman 90 3) Qatar 92 4) Yemen 94 5) United Arab Emirates 96 6) Lebanon 98 7) Saudi Arabia 100 8) Jordan 102 9) Kuwait 104 10) Iraq 106 11) Iran 108 12) Syria 110 13) Bahrain 112 4. Commonwealth of Independent States (CIS) 114 1) Russia 114 2) Belarus 117 3) Ukraine 119 4) Azerbaijan 121 5) Georgia 123 6) Armenia 125 7) Moldova 127 5. Eastern Europe 129 1) Slovenia 129 2) Turkey 131 3) Croatia 133 4) Estonia 135 03 5) Romania 137 6) Serbia 139 7) Bulgaria 141 8) Slovakia 143 9) Macedonia 145 10) Hungary 148 11) Latvia 151 12) Montenegro 153 13) The Czech Republic 155 14) Lithuania 157 15) Albania 160 16) Bosnia 162 17) Cyprus 164 18) Greece 166 19) Poland 168 6. Africa 171 1) Ethiopia 171 2) Egypt 175 3) South Africa 178 4) Kenya 181 5) Nigeria 184 6) Angola 187 7) Morocco 189 8) Algeria 191 9) Ghana 193 10) Sudan 195 11) Tanzania 197 12) Congo (Democratic Republic) 199 13) Tunisia 201 14) Madagascar 203 04 7. Oceania 205 1) New Zealand 205 8. Central America 207 1) Panama 207 Appendix 1: BRI Countries Investment Index Evaluation Framework 210 Appendix 2: List of Data Sources 214 Appendix 3: Abbreviations and Explanations 216 Closing Remarks 217 1 2 Shanghai Municipal Commission of Commerce Belt and Road Countries Investment Index Report 2018 | Section I: Belt and Road Initiative Trends in 2018 Section I: Belt and Road Initiative Trends in 2018 2018 marked the fifth year of the implementation of theBelt and Road Initiative. The BRI has transitioned from a government-led strategy focusing on publicizing its ideology and propositions, featuring investment by state- owned enterprises, towards a more collaborative initiative exploring international cooperation mechanisms for BRI countries that jointly promote trade and investment, and involving more diverse participants. An increasing number of multinational companies and private enterprises have joined the BRI. 1. Belt and Road Initiative in 2018: Achievements and Status Quo The BRI had several fruitful achievements in 2018. As China shifted its policy focus from Going Out to two-way communication and cooperation with other countries, President Xi Jinping reiterated at the Boao Forum, Shanghai Cooperation Organisation Summit 2018, FOCAC (the Forum on China-Africa Cooperation) and other events that China would adhere to a collaborative strategy that strengthens cooperation, sustains common development and promotes a more open, balanced and mutually beneficial approach to globalization. Participating countries have committed to build the Belt and Road jointly with China. Figure 1: President Xi Jinping's speeches on the BRI in 2018 Five years ago, I put forward the Belt and Road Initiative. Since then, more than 80 countries and international organizations have signed cooperation agreements with China. The BRI may be China's idea, but its opportunities and outcomes are going to benefit the world. China has no geopolitical calculations, seeks no exclusionary blocs and imposes no business deals on others. It must be pointed out that as the BRI is a new initiative, it is perfectly natural for there to be different views. As long as the parties embrace the principle of extensive consultation, joint contribution and shared benefits, we can surely enhance cooperation and resolve differences. This way, we can make the BRI the broadest platform for international cooperation in keeping with the trend of economic globalization and to the greater benefit of all our peoples. — April 10, 2018, President Xi's Speech at the Boao Forum Opening Plenary The Belt and Road is an economic cooperation initiative, not a geopolitical or military alliance. It is an open and inclusive process, and not about creating exclusive circles or a 'China club'. We do not exclude others on the basis of ideological differences or play the 'zero-sum game'. We welcome all countries that are willing to participate in the initiative. — August 27, 2018, President Xi's Speech at the Forum on the Five-Year Anniversary of the Belt and Road To respond to the call of the times, China will get actively involved in global governance and stay committed to the vision of consultation, cooperation and benefit for all in global governance. China has all along played its part in promoting world peace and development and upholding the international order. We call for increasing the representation and voice of developing countries in international affairs and support efforts to strengthen the South, a weak link in the global governance system, as well as efforts to create synergy in South-South cooperation.
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