Gerard Rathenau sees analogies between the ways in which infrastructure, power and sovereignty interacted around the late Ottoman Baghdad Railway and today’s Belt and Road Initiative (BRI).
Gerard is a postgraduate student at Utrecht University.
The Baghdad Railway was both a financial and political issue for the Ottoman Empire, as well as for its German instigators. For the Ottomans, it represented an opportunity to strengthen their economic capacity, while Germany’s European rivals feared it might harm their own economic and political interests in the Empire. A century later, China competes with the United States for economic and political influence in Africa and Eurasia through its Belt and Road Initiative (BRI). This constellation of infrastructure projects deploys China’s surplus production capacity, technical know-how, and foreign-exchange reserves in support of its broader geostrategic interests. Although the strategic circumstances of China and Germany are not directly comparable, an analogy can still be made. How helpful is this analogy, and what lessons might we draw from it?
The Baghdad Railway promised to connect previously isolated regions across the vast Ottoman Empire. If Germany succeeded in completing it, it could strengthen its influence over the Ottoman Empire’s economic resources and potentially threaten British and Russian communication routes through the Dardanelles. The BRI provides an analogy to this rivalry between an established great power and a rising one. For China, the BRI represents a geo-economic initiative to connect Eurasia, Africa, and the Middle East and to reduce its strategic vulnerability. It also promises to reduce China’s vulnerability to maritime disruption, such as the recent closure of the Strait of Hormuz, by diversifying its energy and commodity supply routes.
The most obvious analogy between the UK and the US lies in their relative power capabilities. Both Britain and the United States were or are maritime powers with favourable strategic geography. Both have also been able to use financial instruments, including reserve currencies and tariffs, to respond to rising competitors. Doshi nevertheless argues that the use of tariffs can have negative consequences, a lesson that applies to both Britain and the United States.[1] The analogy is nevertheless imperfect, because it is unclear whether the Trump administration is willing and able to compete with China for influence through economic and infrastructure initiatives.
The analogy is nevertheless imperfect, because it is unclear whether the Trump administration is willing and able to compete with China for influence through economic and infrastructure initiatives
Recipient states have retained a degree of autonomy in negotiating infrastructure projects with Germany and China. The Ottomans recognized that foreign direct investment in constructing railways, ports, and roads often came at the price of economic sovereignty. East African countries such as Ethiopia had similar concerns before participating in the BRI. Earlier projects financed by European and American development bodies saddled them with massive debts that they struggled to service, as well as fostering a culture of rent-seeking behaviour among governing elites. Though smaller in scope and ambition than many of the earlier, Western-funded projects, new investments in wind farms and associated infrastructure were important for fulfilling the promise of providing electricity to rural populations.
Ethiopian authorities sought to retain agency over the selection and prioritization of such projects. Ethiopian bureaucrats established contractual requirements to achieve agreed targets, while project delivery risks were placed on the Chinese side. China obtained the concession that only Chinese firms would be involved in the wind farm projects, a condition that their Ottoman predecessors seeking loans from French banks would have recognized. But these firms still had to comply with Ethiopian planning requirements.[3] This demonstrates that Ethiopian state agencies, like the Ottoman government, were not simply passive recipients of foreign investment, but could use their bargaining power to shape infrastructure projects according to their own objectives.
Besides sovereignty, both the Ottoman Empire and Ethiopia were concerned that infrastructure projects should deliver positive economic outcomes for more than a narrow ruling caste. The development of human capital was chief among them. Both the pre-WWI European powers and today’s China, meanwhile, sought to escape mature domestic markets and find an outlet for industrial overcapacity. Chinese companies have had limited incentives for knowledge exchange because of concerns that this could undermine their technological advantage. Like the Ottomans before them, Ethiopian authorities wanted inward investors to train as well as employ local labour. The Ethiopian workforce has benefited from Chinese infrastructure investment, but Ethiopian companies have benefited less from technological spillovers because there was no formal legal and institutional framework to support them.[4]
The Ethiopian case therefore presents a mixed picture: Chinese investment has contributed to infrastructure development and employment, while technological dependence and limited knowledge transfer have remained concerns. This illustrates that economic development and dependence are not mutually exclusive dimensions but can occur simultaneously
Notes
[1] Markus Brunnermeier, Rush Doshi, and Harold James, “Beijing’s Bismarckian Ghosts: How Great Powers Compete Economically,” Washington Quarterly 41. 3 (2018): 10–12.
[2] Frangton Chiyemura, Elisa Gambino, and Tim Zajontz, “Infrastructure and the Politics of African State Agency: Shaping the Belt and Road Initiative in East Africa,” Chinese Political Science Review 8.1 (2023): 116–20.
[3] Valeria Lauria, “Exploring the Impact of Chinese Firms in the Ethiopian Infrastructure Sector: Implications for Local Development,” Journal of Modern African Studies 63. 1 (2025): 13–15.
[4] Lee Jones and Shahar Hameiri, “Debunking the Myth of ‘Debt-Trap Diplomacy’: How Recipient Countries Shape China’s Belt and Road Initiative,” Chatham House (2020): 17–19.
IMAGE CREDIT: German Baghdad Railway, c. 1905. , c. 1905. Library of Congress, G. Eric and Edith Matson Photograph Collection. matpc.04668
Blogposts are published by TLP for the purpose of encouraging informed debate on the legacies of the events surrounding the Lausanne Conference. The views expressed by participants do not necessarily represent the views or opinions of TLP, its partners, convenors or members.