Work

One Belt, Many Roads: Investigating China’s foreign investment and land-use impacts in Southeast Asia

Year: 2025

Type: article

Abstract: Foreign direct investment (FDI) can reshape landscapes in developing countries, but its impact remains unclear. This study examines how China’s Belt and Road Initiative (BRI) FDI impacts land-cover and land-use change in Southeast Asia, a key trade partner receiving significant Chinese infrastructure investments. Focusing on areas with BRI investments from 2008 to 2018, we utilize satellite data to analyze land-use changes across Southeast Asia (Cambodia, Laos, Myanmar, Vietnam), particularly urban growth and deforestation. We find that districts that received BRI investment experienced nearly a 5% greater rate of deforestation than the regional average, with a 0.007% decrease in tree cover associated with every 1% increase in Chinese investment. Districts receiving investments also showed greater increases in cropland and grasslands. While statistical tests indicate the immediate land-cover changes are modest, our findings suggest potential future environmental consequences in Southeast Asia, particularly with ongoing economic development.

Source: Carolina Digital Repository (University of North Carolina at Chapel Hill)

DOI: 10.17615/mg6c-7c27

Authors: Hsu A., Johnson E., Cardwell J., Manya D., Wang X.

Institution: University of North Carolina at Chapel Hill

Language: English

Topic: Belt and Road Initiative

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Industry, innovation and infrastructure, Life on land, Climate action

Open Access status: green

Funder: University of North Carolina at Chapel Hill