Linking Ambitions, Transparency and Institutional Voids to South–South Funded CPEC Project Performance

Abstract

The China Pakistan Economic Corridor (CPEC), an infrastructure-based framework for regional connectivity, is widely perceived in Pakistan as the savior of the country’s economic woes. As the means toward regional political prowess and much-needed economic revival through developmental partnership with the emergent superpower that is China, CPEC-associated projects have become, as expressed through the dominant narrative of the country’s lead planning body (the Planning Commission), the backbone of Pakistan’s medium to a long-term developmental program. Consequently, CPEC projects have been approved, swiftly funded, and expedited in far greater numbers than ever done in the country’s history.

Employing classical contingency theory, this chapter attempts to identify key situational factors impacting the performance of CPEC projects. The chapter identifies complexity, poor implementation capacity, and level of change as specific operational situational factors (OSFs) that CPEC projects contend with in Pakistan. It also identifies institutional voids, poor transparency, project connectedness, and political ambition as strategic situational factors (SSFs). The chapter contends that CPEC projects are not the usual ‘run-of-mill developmental projects’ undertaken in the country; hence the need to manage them differently. Another argument presented is that CPEC projects in Pakistan are representative of a much wider, global phenomenon, that of increasing South-South Economic Development (SSED) collaboration between China and other developing countries (the ‘South’), especially in Africa and Asia. This too, impacts the how CPEC projects need to be managed in a way that is different from ‘the usual’. Pakistan has traditionally been a recipient of Western-led financial and technical assistance for its infrastructure development. However, as a key regional partner in CPEC, Pakistan is undertaking several dozen infrastructure megaprojects, several valued at over a billion dollars each, most of which are either directly or indirectly supported through Chinese SSED. In order to understand the phenomenon, the chapter explains the emergence of Chinese South-South Development Cooperation in Africa and Asia over the last few decades. Differentiating characteristics of SSED-led projects and their implications for recipient countries are explored. The chapter then contends that in Pakistan, where OECD developmental support has been the norm, additional institutional safety nets may be required as the undertaking of novel, complex megaprojects may propel systemic shocks that the country may be inadequately prepared for, especially given the SSFs. The chapter argues that it is essential that both OSFs and SSFs accompanying the country’s first major exposure to south-south development cooperation need to be clearly understood prior to operationalization of the emergent project portfolio. A formalized knowledge management system spanning CPEC projects is recommended.