How does the BRI facilitate state capitalism and GVC integration? Building on previous works examining Chinese foreign direct investments under the BRI, this article answers this question through an analysis of Indonesia and Malaysia. Building on extensive field research data, interviews, and a bespoke database, this article unpacks the mechanisms for which the BRI generates opportunities for activist states to channel new capital and technologies toward national strategic economic outcomes. In Indonesia, Widodo’s state capitalism aimed at import-substitution industrialization restructured the country’s mineral sector to make Indonesia the center of Southeast Asia’s nickel processing. Meanwhile, Malaysia has attracted Chinese solar power manufacturing, thanks to the government’s efforts to direct Chinese investments toward renewable energy and other high-tech manufacturing. The countries employ a different mix of statism and state activism approaches, directed at divergent industrial policy outcomes. In turn, China’s value chains have internationalized for several reasons, including securing access to mineral resources, gaining access to growing foreign markets, and finding new pathways for tariff avoidance in the face of the continuing US-China trade war.

This event is jointly organized by HKUST Greater Eurasia Research Center (GEAR) .