Political Risk on the Belt and Road

China’s programme for inter-regional economic connectivity, the Belt and Road Initiative (BRI), will develop new trade routes and production chains linking predominantly developing world economies with the Chinese market, making a unique contribution to global economic development but disrupting power relativities. At the same time, problems with debt servicing, corruption and a range of other political risks such as the role of Chinese state-owned enterprises have emerged in some BRI partner countries and with some projects. These have encouraged an increasingly negative commentary, particularly following the shift of the US rhetoric since 2017, characterising China as a strategic competitor. Conventional geopolitical, realist and liberal internationalist analysis appears to have reached foregone conclusions that the BRI will generate zero sum benefits to China and costs to others, yet there is a significant research gap in empirical case studies of what is actually taking place on the BRI. To date, firms engaged in BRI projects have been overwhelmingly Chinese, but it is likely that there will be future internationalisation of BRI projects and firms (and governments) will need to assess the full range of political risks of participation. Political risks are non-market risks that may affect business outcomes. While most political risk analysis has usually taken place at the national (country) level or at the firm (project) level, this paper utilises a political risk framework to identify political risks generated by the BRI at the geopolitical and trans-national level, as well as at the country and project levels. Under each of these categories, this paper discusses how risks are constructed, assesses available evidence, agency of stakeholders and identifies where further empirical investigation and theoretical development are required.