BMI research last week published a list of 10 hotspots which the firm believed will see the greatest activity and focus surrounding B&R. China’s Belt & Road (B&R) initiative covers at leas t 65 countries officially and several more unofficially through cooperation agreements and investment pledges.

Of those, the report highlighted 10 markets which they expect will see the greatest investment activity and focus. In selecting these ‘hotspot’ markets BMI had considered two elements, namely, the absolute value of China-backed projects or the relative value of China-backed projects compared to the total project value and the strategic location of a given market in the context of China’s aim of cementing geopolitical ties and facilitating trade.

The countries have been selected based on level of openness to Chinese investment and the strategic important of those countries based on geography or politics.

“The majority of these countries are in Asia but we also highlight several key markets in Europe and the Middle East and Africa” the report said.

Furthermore the report also said under the section about Sri Lanka that the market occupies a central location along Indian Ocean trade routes and has two major China-sponsored port developments underway – the USD1.4 bn Colombo Port City and the USD1.4 bn Hambantota Port, along with associated road, rail and airport developments.

“With a total of at least USD4 .9 bn worth of China-linked projects in Sri Lanka, according to our Key Projects Database, Chinese investments account for a significant proportion of the relatively small market,” it said.

However, these investments also come with risks – work on Hambantota was stalled in January owing to protests opposing over-reliance on Chinese investment and a loss of sovereignty in the port area, especially after state-owned China Merchants Group acquired an 80% stake in the project in a debt/equity swap in 2016.