China's State Capitalism and International Responses: A Comparative Analysis of Infrastructure Investment Strategies

Abstract

Abstract: By introducing the Belt and Road Initiative (BRI), an international infrastructure investment strategy, China attracted a lot of attention. China's approach to state capitalism has opened a window of opportunity for other infrastructure investment strategies. In response, the world's largest and liberally minded economies, such as the United States of America, Japan, and the European Union, have focused on connectivity and embarked on similar strategies. In this article, I conduct a comparative analysis of infrastructure investment strategies. I analyze key tenets of the BRI and international responses through the prism of principles, priorities, funding, financing, governance, and implementation. The comparison of strategies highlights more commonalities than differences, and I identify several instances in which liberal economies act in contradiction to their variety of capitalism. The results suggest that China has opened a window of opportunity for proactive infrastructure investment strategies, and major economies have responded in kind. With overlapping emphases in similar geographic regions, these strategies lead to competition. Consequently, recipient countries profit from an advantageous negotiating position when seeking to attract foreign direct investment in infrastructure projects.