Rethinking governance and development through the Belt and Road Initiative
PETER BUCKLEY, HUSSAIN RAMMAL AND RYAN TANG |
The relationship between governance and economic development has long been a subject of debate among policymakers, development practitioners, and scholars. Conventional wisdom has often suggested that liberal democratic institutions provide the most favourable environment for foreign investment and long-term economic growth. Yet the evolving landscape of international development raises important questions about whether this assumption still holds true.
Our research examines how China’s Belt and Road Initiative (BRI) is reshaping understandings of governance, investment, and development partnerships. Drawing on the case of the China-Pakistan Economic Corridor (CPEC), we explore how large-scale development projects operate within political systems that fall outside traditional democratic models and what this means for international business and development outcomes.
The Belt and Road Initiative has emerged as one of the most significant development and connectivity programmes of the twenty-first century. Through investments in infrastructure, energy, transport, logistics, and industrial development, the initiative has strengthened economic links between China and countries across Asia, Africa, Europe, and Latin America. While much attention has focused on the geopolitical implications of the BRI, less attention has been paid to the governance arrangements that enable these investments and the assumptions that underpin prevailing theories of development.
Pakistan provides a particularly valuable case study. As a political system often characterised as a hybrid regime, it combines democratic institutions with strong military, bureaucratic, and state-led influences. Traditional international business theories frequently regard such governance environments as sources of uncertainty and risk for investors. However, our findings suggest a more nuanced reality.
Rather than acting solely as a constraint, hybrid governance arrangements can create forms of institutional stability that support long-term investment and policy continuity. In the case of CPEC, political and administrative structures have helped sustain major infrastructure and development projects despite changes in governments and shifting political circumstances. This challenges the common assumption that democratic governance is the only institutional framework capable of fostering stable investment environments.
Our analysis suggests that understanding governance requires moving beyond simple classifications of democratic and authoritarian systems. Political institutions operate within specific historical, cultural, and economic contexts, and their effectiveness cannot be assessed solely according to formal institutional characteristics. The capacity to coordinate long-term development strategies, mobilise resources, and maintain policy consistency can be equally important factors in shaping investment outcomes.
These findings have broader implications for how development partnerships are understood and evaluated. For decades, international development discourse has largely linked economic development with liberalisation, democratisation, and market reforms. The BRI presents an alternative model that places greater emphasis on state-led coordination, infrastructure development, and strategic economic partnerships. Whether one model is ultimately preferable to another is not the focus of our research. Instead, we argue that the emergence of multiple development pathways requires a more flexible understanding of how governance influences economic transformation.
The implications extend beyond investment flows. Infrastructure projects such as CPEC are often designed to improve connectivity, strengthen regional integration, address energy shortages, and expand access to markets. These investments can create opportunities for economic growth, employment, and improved service delivery, particularly in regions that have historically experienced underinvestment.
However, development outcomes should not be measured solely by the scale of investment or the completion of infrastructure projects. An equally important question is how the benefits of development are distributed. Improved transport networks, industrial zones, and energy infrastructure can contribute to more inclusive economic opportunities, but only when local communities are able to participate in and benefit from the growth they generate.
This highlights the importance of considering development not only as an economic process but also as a social one. Governance arrangements play a critical role in determining whether infrastructure-led growth contributes to broader development objectives, including poverty reduction, regional equity, and access to economic opportunities. As governments pursue ambitious development strategies, attention must remain focused on ensuring that growth translates into tangible benefits for diverse communities rather than concentrating gains among a limited set of actors.
The rise of the Belt and Road Initiative reflects a broader shift in the global development landscape. New actors, new forms of cooperation, and new institutional arrangements are challenging established assumptions about the relationship between governance and development. Understanding these changes is essential for governments, businesses, and development practitioners seeking to navigate an increasingly complex international environment.
Our research contributes to this conversation by demonstrating that governance systems should be understood not only through their formal political characteristics but also through their capacity to facilitate sustainable and broadly shared development outcomes. As alternative models of development continue to emerge, a more nuanced and context-sensitive approach to governance will be essential for understanding the future of international development partnerships.
AUTHORS
Peter J. Buckley OBE FBA is Professor of International Business at Alliance Manchester Business School, The University of Manchester, United Kingdom. Hussain G. Rammal is Professor of International Business at Adelaide University, Australia. Ryan W. Tang is Associate Professor of International Business at Griffith University and a member of the Griffith Asia Institute, Australia.
This article is a synopsis of the journal article: Buckley, PJ, Rammal, HG and Tang, RW, (2026), “Hybrid regimes and international business: Exploring the interplay between democracy and authoritarianism in the belt and road initiative”, Journal of Business Research, Vol 213, https://doi.org/10.1016/j.jbusres.2026.116263.