Silk Road 2.0, Manchester city-region and the new global infrastructure space
Jon Silver, Leverhulme Early Career Fellow, Durham University
The visit from the Chinese President Xi Jinping to Manchester is just the latest and perhaps most high profile moment in what looks like a fundamental realignment of UK and to a lesser degree Chinese infrastructure space in the global economic system, one in which this city-region will seemingly play a central role.
It was only weeks ago that the Chancellor George Osborne, leading proponent of the Northern Powerhouse, spoke from China to announce a ‘historic’ £60 million investment from the Hualing Industry and Trade Group of Xinjiang Province into various development sites across northern England, including in Salford. Yet, in the proceeding few weeks the barrage of announcements concerning Chinese investment across mega-infrastructure projects such as HS2 and new nuclear power facilities has overshadowed this rather modest investment in Salford. As we clamour to understand these emergent relations between the UK and China, it is worth paying more attention to this patch of Salford land close to Manchester city centre as it becomes enrolled in a series of global-local realignments that reflect a profound shift in the UK’s infrastructure space. This space encompasses both the emergence of the city-region’s built environment as a high performing investment for surplus capital but also the new financial architectures of trade – in which cities themselves become infrastructure for new configurations of global capitalism.
Middlewood Locks is a large former industrial zone of 8.5 hectares in Salford facing across the River Irwell towards central Manchester that is being developed into apartments for the city-region’s growing real estate market. At the moment it remains empty, bar the overgrown weeds and algae clogged canals that criss-cross the site, with a forlorn set of ugly 1990s ‘regeneration’ apartments and multiple railway routes enclosing the land. It has undergone both expensive state funded remediation and a series of stalled developments both before and after the economic crisis. Securing the investment from Xinjiang by the Scarborough Group follows in the footsteps of backing from real estate investors Top Spring International Holding Ltd of Hong Kong and Metro Holdings of Singapore; it means that finances are now in place to create this new extension the city-region’s centre. With Salford Council ensuring the ‘best’ financial conditions for investment including withdrawing any social housing requirements and dramatically reducing the S106 agreement from an initial £8 million to less than £2 million, the site has become a significant investment opportunity with a potential final value of £700 million. While the financial returns on property in the Manchester city region are increasingly seen as alternative to London’s real estate market, the motivations of the Hualing Industry and Trade Group probably do not stop with the sinking of excess capital in the growing built environment of the Manchester city-region.
It begs the question as to why this investment, facilitated by an enthusiastic Chinese state Premier and the UK Chancellor has come about. The answer lies not in Salford, but on the old trade route connecting the East and West made famous by explorers such as Macro Polo: the Silk Road.
Out in China’s far-west lays the Xinjiang Uyghur Autonomous Region. It is a restive Province, experiencing ongoing human rights abuses and suppression of dissent that has led to over $15 billion of state investment on infrastructure such as high speed rail. This huge capital investment has been designed with the purpose of calming local tensions through attempting to match the economic ‘miracle’ of China’s eastern seaboard. As part of this at-times socially and environmentally catastrophic transformation, the historic importance of Xinjiang on the old Silk Road is being reimagined to align it with the new global infrastructures of trade that are being pursued by the Chinese state, integrating it both domestically and internationally by creating new infrastructure space as part of the One Road, One Belt Initiative or what some term Silk Road 2.0. This is not just about infrastructure hardware such as railways or broadband, but a global architecture that has emerged over the last 30 years, one that connects disparate places through diplomatic treaties, trade agreements, regulations, banking and finance standards and other forms of connection and configuration. Most recently explored by the urbanist and architectural scholar Keller Easterling, who has charted the emergence of free trade zones and other political instruments outlined above, we can term these collective processes the infrastructure space of the 21st century globalised economy.
The creation of this infrastructure space by the Chinese state has meant the largest city of Xinjiang, Ürümqi is fast becoming the base from which foreign direct investment flows into the Central Asian countries that sit further west down this oldest of trade routes. Companies such as Hualing Industry and Trade Group, growing out of this recent surge in infrastructural investment in Xinjiang are increasingly supported by the Chinese State to think internationally to invest some of the surplus capital created over the last decade or so of state-led, economic growth (and despite recent turbulence in the stock market). Initiatives such as One Road, One Belt, by the Chinese state bears more than a passing resemblance to Osborne’s agglomerated vision for the Northern Powerhouse, as these marginalised regions in the UK and China are aided by state support at the highest levels and positioned within new global infrastructure space. China’s motivations and capacities are of course very different belying the shift in global economic power in the new century where it seeks to cement its position as the world’s foremost economy. Whilst previous investment has focused on assembling components of this infrastructure beyond China’s borders (particularly through a Free Trade Zone in Kutaisi City, Georgia), the announcement of investment in the UK including in Salford suggests a scaling up of aspirations of Silk Road 2.0 beyond the limits of the old Silk Road and into northern and western Europe. Through this investment Middlewood Locks has thus become an early, visible symbol of these aspirations to extend China’s trade influence as part of its $40 billion Silk Road Fund. Understanding Chinese motivations behind the reshaping of both its own and the UK’s infrastructure space also generates some important questions about this apparently blooming relationship, particularly in regards to an ongoing concern with human rights, but also in terms of the economic futures of the UK and the Manchester city-region that seem to emerge from this infrastructural alignment.
The investment in Middlewood and Osborne’s subsequent insistence that the UK would provide a crucial development partner to Xinjiang Uyghur Autonomous Region has provoked critical reactions from the media and human rights organisations. At the core of this contention is the forced displacement of the Uyghur people from Xinjiang over the last 30 years by the Chinese State, documented by numerous human rights groups including Human Rights Watch who report “Pervasive ethnic discrimination, severe religious repression, and increasing cultural suppression” in the Province. With Rebiya Kadeer, President of the World Uyghur Congress, being quoted on the Uyghur Human Rights Project as saying the UK, “should know that in that red carpet is the blood of the Uighur people, Tibet and other Chinese dissidents,” it is impossible to ignore the ways in which Middlewood Locks is intrinsically tied to the authoritarian state building project in Xinjiang and its aspirations for Silk Road 2.0.
Back in the Manchester city-region, these issues are somewhat lost amongst the enthusiasm generated through this wave of Chinese investment. Manchester has enjoyed unprecedented attention over the last year at the centre of Osborne’s Northern Powerhouse, while at the same time has been securing growing foreign capital investment (for instance a £1 billion housing deal with Abu Dhabi to develop parts of East Manchester).
It leaves the city-region at an interesting juncture in its history, one that is already profoundly shifting its infrastructure space into global alignments with countries such as China and Abu Dhabi. Whereas in the past sites like Middlewood Locks held a position in global trade networks that transformed raw materials such as cotton and slave labour into an exchange value in the form of manufactured cloth, the city-region is now configured very differently in the world economy. It has become a site for the secondary circuit of capital – the surplus value generated through economic growth in states such as China and Abu Dhabi and associated with a series of speculative real estate and infrastructure projects in the city. But importantly and what is becoming increasingly evident is that it also seeks to position itself firmly within the infrastructure space of these countries, not just to attract investment into the built environment but to finance its knowledge economy aspirations in an era of austerity where little UK state investment is to be found. This move by local politicians is inherently uncertain in its potential outcomes, but is tying the city-region’s future to particular global models of capitalism over which they will have very little control.
This new infrastructure space is not just interesting financially. It generates important political questions about the future orientation of the controlling Labour party across the city-region. As it very publicly aligns to Osborne’s attempt at a shift in the UK’s economic basis through allowing new Chinese infrastructure space to emerge while remaining at the heart of the Chancellors devolution agenda, it provides a city that will either suffer the consequences of Osborne’s political-economic manoeuvres or reap many of the early benefits. Equally lauded and criticised for its embracing of a neoliberal economic model, the city-region has been at the forefront of all manner of Labour and Tory government restructuring of local state functions since the 1980s. With the Labour Party now led by Jeremy Corbyn it will be interesting to see how the local politicians respond to his clear rejection of economic orthodoxy and growth models that much of this new infrastructure space is predicated upon. At a moment when leaders feel the city-region has finally achieved its post-industrial potential, this means that relations are likely to remain strained across the Labour Party and create real dividing lines about how urban political-economic futures are being shaped. This leaves the local party locked into a model of capitalism that has little focus on social justice beyond an implicit (and outdated) belief in trickle-down economics and a very different vision from the anti-austerity agenda being led by Corbyn, McDonnell and others.
As Middlewood Locks’ ‘aspirational’ apartments are constructed, they will be well out of the financial reach of many local residents living in some of the poorest areas of the UK. Furthermore, they signify a wave of political economic change for the city-region and wider national economy that heralds a new era of infrastructure space that is simultaneously local and global in its scope, operation and symbolism. Whether such a alignment is to be welcomed remains questionable, but debate is certainly needed to address the dramatic transformation in the ways in which both the UK and the city-region operate in the world economic system.
This should not be a decision taken by local and national politicians alone. Rather, it should be opened up to those living in Greater Manchester who might value human rights or alternative economic strategies more than another multi-million speculative development with no social housing, which pegs its future to a state-building project by an authoritarian regime. It is disingenuous to argue that this alignment with China is the only feasible option and that to take a stand against human rights in which certain disinvestment would follow is not of the ‘real world’. For a city-region that celebrates its radical past now might be a time to show the world the values of social justice and freedom that are supposedly cherished. The example of famine afflicted Lancashire cotton workers during the American Civil War adopting an anti-slavery stance stands out as a precedent in challenging unjust and seemingly unmovable infrastructures of global trade. Whether the appetite and will to draw back from this emerging infrastructure space across Xinjiang and Manchester city region exists remains another thing entirely.
This essay has come out of an ongoing conversations with Alan Wiig, University of Massachusetts as part of research we are undertaking on Manchester’s changing infrastructure and political economy.