Success Factors of Cross-Border Agricultural Investments for Opium Poppy Alternative Project under China’s Belt and Road Initiative

Abstract

Cross-border agricultural investments (CBAIs) are considered to be an essential strategy that is expected to bridge the gap between poverty reduction and rural development in marginalized regions. Agricultural investments serve as a necessary indicator of the performance of international cooperation in China’s Belt and Road Initiative. It is of great significance to summarize the success factors of Chinese investors under this initiative and, more importantly, to improve the sustainability of CBAI projects and associated rural development. Extensive opium poppy cultivation is a barrier to poverty reduction in marginalized communities in less-developed countries such as Laos and Myanmar. The CBAIs in the opium poppy alternative (OPA) project conducted by Chinese agricultural companies aim to reduce drug crop cultivation and rural poverty based on a perspective of economic development. However, little is known about how participating companies cooperate with ex-poppy farmers to achieve investment success. In this study, we adopted case interviews and questionnaire surveys from Chinese agricultural companies in the China–Myanmar–Laos border region, with the aim to explore the success factors of CBAIs in the OPA project under China’s Belt and Road Initiative. The results indicated that the success of agricultural companies involved in the OPA project depended on three key factors, including (1) institutional and employee capacity building, (2) responses to policy and market incentives, and (3) support for the participation of ex-poppy farmers and community development. Our findings contribute to the theoretical and practical understanding of capacity improvements for foreign investors in China’s Belt and Road Initiative and shed light on the support of international agricultural cooperation for rural livelihood improvement.

1. Introduction

Agricultural investments are well accepted as an effective strategy for rural poverty reduction in developing countries [1]. The effort of lifting 736 million people out of extreme poverty poses a serious challenge to the Sustainable Development Agenda of the United Nations. Globally, 83.5% of poverty exists in rural areas, bringing about multiple problems such as low-density educational systems, poor proximity to and availability of public services, and the limited provision of infrastructure [2,3]. Most less-developed countries suffer greatly from limited financial capacities and hardly meet their investment requirements [4], so international agricultural investments are expected to bridge the financial gaps between poverty reduction and rural development [5,6,7]. Cross-border agricultural investments (CBAIs) are well acknowledged as a feasible approach to generate benefits for developing countries in many ways [8], including through technology transfer, manufactured input, machinery, management experience, and skills training [9,10]. These improvements can lead to significant increases in agricultural productivity [10], food availability [11], rural employment [10,12], and access to capital [13]. However, from the perspective of investors, there is high risk involved in international agricultural businesses, highlighting the importance of exploring successful investor–farmer relationships [4] in the context of poverty reduction and rural development agendas.

Exploring successful practices in agricultural investments is especially necessary for China’s Belt and Road Initiative (BRI). Presently, the agricultural sector accounts for more than 25% of Gross Domestic Product, and more than 40% of agricultural employment occurs in BRI countries [14]. Moreover, the greatest concentration of poverty still remains in rural areas, and the majority of BRI countries need foreign investments to enhance their agricultural productivity and food security [14]. A majority of Chinese agricultural companies have invested in BRI countries. Up until the end of 2020, 821 Chinese agricultural companies started up their businesses in 83 BRI countries, accounting for 81% of the total agricultural companies in China’s foreign investments. The investments mainly concentrate on farming (48%), animal husbandry (10%), fishery (13%), and other agricultural sectors (30%) [15]. In recent years, most of the reports or academic papers on the BRI have been focused on several topics, including infrastructure development, industrial and sub-regional economic collaboration, and financial cooperation. However, while ample evidence indicates that agricultural cooperation serves as a pillar for the success of the BRI policy [11], the agricultural sector is rarely analyzed. Moreover, there are only a few case studies focusing on the success profile of foreign agricultural companies in Africa, and their findings suggest that companies’ management techniques, technical skills, experience, and priority objectives had important impacts on investment outcomes [4]. However, the connections between companies’ management and investment experience and successful investments are barely documented, especially for the companies in the BRI context. With our analyses, we aim to fill this gap.

Agricultural investment in opium poppy alternative (OPA) projects is tightly associated with poverty alleviation and rural development in developing countries such as Myanmar and Laos. Myanmar and Laos are the major cooperative countries for Chinese foreign agricultural investments under the BRI, and the number of Chinese agricultural companies in Myanmar and Laos in 2020 were 101 and 91, respectively [15]. Furthermore, Myanmar and Laos are also the second and third largest producers of illicit opium poppy worldwide, respectively [16]. The cultivation of opium poppy in marginalized rural communities has caused serious problems such as crimes, ethnic conflicts, social security, and environmental hazards [17,18]. Due to the specific natural conditions in mountainous areas and the relevant rural poverty, small farmers have to take the risk of growing illegal crops in order to support their livelihoods, but they still suffer greatly from poverty, food shortages, diseases, and even military conflicts [19]. The persistent fear of hunger, poor infrastructure, and geographic isolation has resulted in inefficient agricultural land use, triggering farmers’ acceptance of poppy cultivation [19]. It is estimated that an additional investment of USD 41 million per year is needed for Laos to achieve the first two sustainable development goals by 2030; over four-fifths of these additional investments should target agricultural sectors [20]. In particular, evidence has shown that the livelihood in illicit crop-growing areas has become more vulnerable since the onset of the COVID-19 epidemic, which caused closed borders and poor access to markets, leaving illicit crop cultivation as one of the few feasible options for marginalized rural communities [21].

The opium poppy alternative projects, initiated by Chinese agricultural companies in Myanmar and Laos, serve as a creative CBAI strategy to address poverty and drug issues [19]. It has been stated that forced eradication and community-based alternatives were adopted for the reduction of drug crop cultivation, but limited success was reported [22,23,24]. For instance, the conduction of forced eradication measures in Afghanistan caused opium poppy reduction through increased agricultural investment, but these measures eventually failed due to the lack of fundamental promotion of socio-economic change [25]. The community-based approach encourages farmers to grow legal crops, but the lack of market demand makes this approach inefficient [19]. The OPA projects in Myanmar and Laos are quite different from those cases. These projects are mainly conducted by Chinese agricultural companies and then can gain strong support from the Chinese government to offset the risk of investing in marginalized areas via subsidies and tax waivers, including the Opium Replacement Fund; low-interest loans; import tax reduction; and permissions to import crop products [26,27]. In addition, the Laos government has considered the encouragement of foreign agricultural investments as a primary strategy to boost economy since early 2000s [26]. It is indicated that the OPA could substantially relieve rural food shortages [19], reduce opium poppy cultivation, and improve the livelihoods of ex-poppy farmers [26]. Yet, there is a concern that the OPA project might lead to conflicts between foreign investors and local farmers, inefficiencies in poverty reduction (e.g., the poorest farmers benefit the least), and misunderstandings between Western actors and the Laos government [22,27].

Some studies have indicated that not only essential infrastructure-relevant services are difficult for local farmers to access, but that there were also strong links between opium poppy cultivation and rural poverty [28,29]. Furthermore, many scientists hold the view that institutional infrastructure, efficient management [4], the localization of human resources [30,31], corporate social responsibility [32,33], and cross-cultural communication [34] are helpful for the promotion of foreign investors’ performance and to increase the possibilities of investment success. Based on the above, what is the profile of the agricultural companies conducting the OPA project? How do these companies make investments in rural villages that have a long history of opium poppy cultivation? Are there any good practices for communicating with local communities? How can the sustainability of company development be improved to contribute to poverty alleviation and rural development in illicit drug crop regions? This is of great interest not only to agricultural investors, but also to academic researchers and policy makers [19,26,27].

In order to address those questions, we aimed to explore the success factors of the CBAIs for the OPA project using key informant interviews and questionnaire surveys. To that end, we focused on (1) companies’ inner capacities, (2) external policy and market environments, and (3) community development. This study is proposed, from the perspective of companies, to improve the success and sustainability of CBAI-based agricultural collaboration in less-developed countries.

2. Materials and Methods

2.1. Study Area

This study was conducted in Yunnan Province in southwestern China. Yunnan borders Myanmar, Laos, and Vietnam, providing suitable natural and social conditions for multinational agricultural cooperation, and the CBAI policy for the OPA was mainly implemented in the Shan and Kachin states in Myanmar and seven provinces in Laos (Figure 1). We collected data from the representative companies engaged in OPA programs in Yunnan. The states of Shan and Kachin are located in northern Myanmar and share borders with western and southern Yunnan. Multiple ethnic groups inhabit these areas, making spoken languages diverse. There are large areas of rubber, maize, sugarcane, and fruit plantations in Shan and Kachin [35]. The region of seven provinces in northern Laos contains multiple hilly areas and borders southern Yunnan, western Myanmar, northern Thailand, and northwestern Vietnam. Local residents make their livelihoods mainly by cultivating rice, maize, beans, and vegetables [36].

2.2. Research Design

2.2.1. Selection of Surveyed Cities

Yunnan Province is considered a representative region for the implementation of the OPA project in China [19]. We conducted regional sampling of cities where the CBAI policy for OPA has been followed by many companies. We used data from the Yunnan Department of Commerce to identify involved cities and companies located in the China–Myanmar–Laos border region. A total of 11 cities (two municipalities and nine counties) containing CBAI companies were surveyed (Figure 1). Subsequently, key informant interviews (

Table 1. Basic information on reliable key informants.

Key Informant	Company Site	Occupation
KI-01	MengLa County	General Manager
KI-02	Pu’er City	Manager
KI-03	Pu’er City	Technical manager
KI-04	Kunming	Technical manager
KI-05	Kunming	Chairman
KI-06	Pu’er City	Manager
KI-07	Lincang City	Technical manager
KI-08	Kunming	Secretary General
KI-09	Questionnaire companies

Source: Key informant interviews in this study.

) and company questionnaires were conducted in these cities.

2.2.2. Key Informant Interviews

Companies with long-term investments and rich experience could provide detailed and reliable information. Seven companies were involved in the OPA project, and all of them provided content-relevant information. We carried out a title-based selection of the key informants that included the general manager, technical manager, chairman, and secretory general (KI-01-07; see Table 1). One key informant was selected from the Trade Association given his important role in CBAI implementation (KI-08; see Table 1). The interviews were conducted from 2017 to 2021, and at least one or two informants from each sampled company were interviewed. A semi-structured interview was used, and at least two interviewers participated in the process. One interviewer first explained the scientific purposes of our research and then invited the interviewee to talk about his/her company. The content of the interviews included questions on investment background and motivation, internal management, external communication, and social responsibility. In particular, we asked about how OPA programs influenced rural income, living conditions, employment, technology adaptiveness, farming skills, and access to markets. Another interviewer made detailed notes and created a voice recording with the interviewee’s permission. In addition, the interviewers requested to view relevant documents and materials only available in internal reports. Key informant interviews lasted for 60 min on average. To support the summary of company success factors, we added one open-ended question to the final part of the questionnaire to collect information on the companies’ successful practices. Then, we grouped these answers to support the key informant interviews as KI-09 (Table 1).

2.2.3. Questionnaires

A semi-structured questionnaire (Appendix A) including both qualitative and quantitative sections was conducted among companies (n = 109) in the study area between 2019 and 2020. To ensure the reliability of the samples, we distributed paper questionnaires to respondents who were familiar with their company’s operations abroad. The questionnaire consisted of 26 questions that were grouped into five sections. The first section focused on background information, including the invested country, initial time, ownership, investment sector and links, and benefit appraisal. The remaining four sections covered (1) the company’s institutional and employee capacities (15 questions), (2) company responses to policy and market incentives (two questions), (3) company support for community development (3 questions), and (4) successful investment experiences (1 open-ended question). Prior to the interviews, we informed the respondents that no personal or company information would be involved in this research and that the results would only be used for scientific purposes. The length of each interview was approximately 30 minutes. Questionnaires were considered invalid if they contained unanswered questions or illogical responses because all responses were needed for further analyses.

2.2.4. Data Organization and Analysis

Information/data collected from the key informant interviews were organized and categorized to qualitatively support of the relevant results. Handwritten/typed notes and observation records were carefully reviewed and edited. Answers to the company’s questionnaires with pre-defined choices were used for the quantitative analysis of the profiles, internal capacity building, external environment, and support to communities. Content-based data from the questionnaires, interview notes, documents, and materials were entered into Excel spreadsheets and analyzed.

3. Results

3.1. Characteristics of Surveyed Companies

A total of 112 questionnaires were returned, and 109 (97%) of them were completed and considered valid. Company characteristics were expressed as frequencies and percentages (

Table 2. Company characteristics on the questionnaire (n = 109).

Category	Item	Frequency	Percentage
Ownership	Private	93	85
	State-owned	12	11
	Chinese–foreign joint	4	3
Country	Myanmar	63	58
	Laos	46	42
Initial period	Before 2000	9	8
	Between 2001 and 2010	93	86
	Since 2010	7	6
Sector	Farming	102	94
(Multiple choices)	Forestry	24	22
	Animal farming	21	19
Investment field	Agricultural production	99	90
(Multiple choices)	Agro-processing	49	45
	Marketing sites	7	6
Benefits	High-level	74	68
	Moderate-level	27	25
	Low-level	8	7

Source: Questionnaire surveys in this study.

): over four-fifths of the companies were privately-owned (85%); Myanmar received more attention (58%) than Laos (42%); most of the companies had initiated investment programs between 2001 and 2010 (86%); the farming sector had investment priority (94%); the investment links focused on agricultural production (90%); and a majority of the companies obtained a high-level benefit (68%).

3.2. Company Institutional and Employee Capacities

The questionnaire respondents indicated that finance and human resources were considered necessary for investment success (Figure 2a). The key informant interviews indicated that it took an average of seven years for investors to benefit from rubber cultivation, and before the benefits were realized, they had to cover the costs of many items such as seedlings; water and electricity consumption; and employee salaries (KI-01; KI-04). Some companies performed well with capital control in the early phases and spent money strictly according to their budgets (KI-01). However, some companies exhibited poor financial management and experienced capital shortages within only a few years (KI-02).

Companies aimed to motivate their employees by adopting promotion and reward policies (KI-06). The questionnaires showed that the investment plan (99%), emergency response system (97%), and annual reports (88%) were recommended by a majority of the respondents (Figure 2a). The key informant interviews showed that investment plans were necessary for companies to adjust their production strategies and to better meet market demands (KI-03); emergency response systems were effective in handling sudden events such as agricultural disasters or staff disputes (KI-01; KI-03). Annual reports were helpful for companies to accumulate practical experience and to communicate with local governments or industrial associations (KI-05).

The results showed that farming skill training (100%) and management skill training (99%) were conducted as necessary by the companies for investment success (Figure 2b). Investors invited agricultural experts from China to teach local technicians, or funded local staff travelled to China to study (KI-01; KI-03). Companies preferred to employ village heads to carry out management roles. This approach showed its effectiveness during the coronavirus (COVID-19) pandemic in 2020. The local staff effectively maintained regular agricultural activities when the Chinese staff could not travel abroad (KI-01; KI-08).

The results further showed that laws and regulations (94%) along with environmental awareness (94%) were approved by most of the respondents (Figure 2b). The compliance with investment laws and regulations helped companies to function smoothly and protected their interests (KI-09), and the protection of landscapes and forests in areas of substitution planting promoted trust from local authorities and farmers (KI-03). Our results also revealed that communication skills (94%) and understanding local customs and cultures were preferred by most of the respondents (84%) (Figure 2b). The key informant interviews indicated that promoting employee’s communication skills helped to improve business performance (KI-04), and mutual understanding between the Chinese and local employees was improved by participation in leisure activities, such as karaoke and playing basketball and volleyball (KI-02; KI-04; KI-05).

3.3. Company Responses to Policy and Market Incentives

In total 74% of the respondents thought positively about land use attractiveness (74%) and tax relief (51%) being given as priority incentives (Figure 3a). One key informant indicated that the involvement of local farmers as business partners under a form of contract farming gave them an active role in the management of their land and reduced companies’ running costs, allowing companies to enjoy tax exemptions for the first five years (KI-05). Furthermore, fewer respondents preferred the policies for water and electricity charges (6%) and bank services (5%) (Figure 3a). Another key informant interview stated that investors were treated the same as local inhabitants regarding water and electricity charges as well as bank services. However, this made it convenient for investors to pay the bills by electronical cross-border e-payments from Chinese banks (KI-03).

The respondents indicated that market research was considered highly necessary for investment success (100%) (Figure 3b). The key informant interviews indicated that, on the one hand, companies value the role of market information and make great efforts to meet local and Chinese market demands (KI-09); on the other hand, many companies sold products from Laos to international buyers (KI-05). The results also indicated that over 87% of the companies agreed that policies had a greater market-orienting role than trade associations (51%) (Figure 3b). Investors paid much more attention to the agricultural industrial policies of China so that their cross-border investments could be integrated with domestic development (KI-04). Additionally, trade associations such as the Chamber of Commerce of Hunan Province and the Chamber of Commerce of Zhejiang Province provide market services as well (KI-01). Nevertheless, fewer respondents supported investment recommendations (15%) (Figure 3b) as a market incentive since there was a lack of trading platforms in Laos (KI-05; KI-08).

3.4. Company Support for Community Development

3.4.1. Communication with Farmers

The questionnaires indicated that conflict resolution (98%) and media promotion (91%) were approved by most company respondents (Figure 4). A key informant expressed his view that effective communication and partnership with farmers were critical for building mutual trust (KI-05). Furthermore, media promotion was effective in educating and unifying local stakeholders (KI-01). The results also indicated that over three-fifths of the respondents used social responsibility reports (67%) as a communication tool over websites (16%) (Figure 4). Social responsibility reports allow more people to learn about responsible investors in community services (KI-06). Although the internet is capable of providing diverse information, local farmers still rely on television and mobile phones to access information due to poor internet services (KI-02).

3.4.2. Farmer Skill Training

Multiple OPA programs have been conducted in mountainous areas, and ex-poppy farmers with skills or experience in agricultural practices are required (KI-01). Companies regularly invite agricultural technicians or experts from Chinese institutes to conduct skill trainings, such as the Institute of Tropical Crops in Xishuangbanna and the Institute of Agricultural Science in Baoshan of Yunnan Province (KI-03; KI-05). Moreover, to increase local food sources, companies teach ex-poppy farmers to grow upland rice and maize under rubber trees, and farmers could diversify their earnings (KI-09). A key informant advised that up until 2017, the approximate area of upland rice and maize under rubber trees reached 1309 hectares, with a grain yield of over 39 million kilograms and a total income of approximately USD 5.8 million (KI-03). After more than a decade of investment, the companies had successfully transformed ex-poppy farmers into regular farmer through introducing skills related to growing rice, coffee, sugar cane, and other crops. Moreover, the companies provided plentiful job opportunities and greatly increased farmer income (

Table 3. Job opportunities and income improvements caused by CBAIs.

Key Informant	Involved Region	Number of Involved Farmers	Number of Created Job Opportunities	Increased per Capital Income (USD)
KI-01	Luang Namtha	13,000	15,000	1232
KI-02	Bokeo	17,000	4700	2608
KI-03	Luang Prabang	21,000	7800	2188
KI-04	Luang Namtha	100,000	6000	2173
KI-05	Phonsaly	30,000	19,300	1246
KI-06	Shan	6900	3200	960
KI-07	Shan	64,694	/	1043

Note: Annual per capital income from 2018–2021 at the exchange rate of USD 1 to CNY 6.9 in 2021. Source: Key informant interview in this study.

).

3.4.3. Care for Vulnerable Groups

In total, 87% of companies had the experience of providing school supplies, while 52% and 23% provided financial assistance to primary students and college students, respectively (Figure 5a). Investors donated school bags, stationary, desks, and computers to different communities (KI-01-07); they funded poor children to study in primary schools nearby as well as youth to study in colleges or universities in China (KI-01, KI-04). The questionnaires also indicated that only 17% of the companies conducted free Chinese-learning courses (Figure 5a). These courses were necessary for local staff by facilitating the communication bridge between the companies and local communities (KI-07).

In terms of healthcare, more respondents provided medical supplies (80%) than medical consultations (40%) and facilities (31%) (Figure 5b). By doing that, the companies hoped to improve the local medical conditions especially for vulnerable groups, and medical experts were regularly invited to local communities (KI-01, KI-04). There were only 4% of respondents who were concerned with medical insurance (Figure 5b). A key informant indicated that medical insurance was tightly connected to farmers’ incomes and local health systems, and that it was unnecessary for companies to take it into consideration (KI-08).

3.4.4. Improvement of Infrastructure

The questionnaires showed that roads and bridges (87%) were the top items on the lists of infrastructure improvements by the companies. Additionally, about 76% and 67% of the companies focused on the construction of schools and the development of drinking water systems, respectively (Figure 6). Ex-poppy farmers live in remote mountainous regions, and investments in roads and bridges were the largest in the early stages (KI-06). The construction of two schools in the early 2010s allowed more than 400 children to be enrolled in school, and the first drinking water project completed in 2013 benefitted more than 100 households (KI-01).

The questionnaires showed that the respondents also invested in hospitals (47%), irrigation facilities (45%), and electric utilities (38%) (Figure 6). The key informant interviews stated that the hospital was operated by local doctors and that the investments were helpful to provide medical services for local farmers (KI-03); irrigation facilities effectively solved water supply problems for mountain cultivation (KI-04); however, funding for an electric utility was too costly for investors but was welcomed by local governments and farmers (KI-01).

A compilation of the data from the seven key informants showed the details of further infrastructure improvements (

Table 4. Main infrastructure improvements by key informants.

Key Informant	School	Hospital	Bridge	Road (km)	Drinking Water Pipe (km)	Electricity Line (km)	Total Input (Million USD)
KI-01	2	1	2	150	10	20	905,797
KI-02	1	1	1	100	7	13	637,682
KI-03	1	1	5	370	/	6.1	2,239,130
KI-04	1	1	3	194	14	17.8	1,145,362
KI-05	2	1	1	253	/	/	924,029
KI-06	1	1	/	80	/	/	463,768
KI-07	1	1	/	5555	/	/	11,549,203

Source: Key informant interviews in this study.

). These infrastructures greatly improved the living conditions of farmers, and increased their willingness to continue regular farming activities rather than restoring opium poppy cultivation (KI-01-07). To commemorate the contributions of the companies to their communities, local farmers even named roads “Coffee Road” or “Sugarcane Road” (KI-05; KI-07).

4. Discussion

4.1. Promote Company’s Internal Management

The top priority for the companies’ success is to improve internal management given that finance management is one of the key factors. Our results support the view that a financial control system could guarantee the sustainability of capital flow and prevent asset losses [37]. Most of the surveyed respondents considered investment planning, emergency response, and annual reports as very important factors for success. This result also agrees with the statement that investment success is closely tied to institutional infrastructure [38], and that the well-organized management, experience, and priority objectives of foreign agricultural companies could positively influence investment outcomes [4]. Another key factor in promoting the internal management of companies is the adequate development of local employees. The surveyed companies emphasized the improvement in employee skills in farming and management, and applied competitive payments and incentives to increase the initiative of local employees. This finding supports the view that the localization of human resources is crucial for a multinational business [30,31], especially in terms of being a bridge between multinational companies and host countries, helping to boost performance, facilitating market development [39], and reducing institutional pressure [40]. Furthermore, we found that the employees’ understandings of local laws and regulations, environmental awareness, and customs and cultures were essential, highlighting the important role of cross-cultural communication in exerting positive impacts on investment outcomes under multinational investment scenarios [34].

It is worth noting that the companies that had engaged in the OPA program were registered with and supervised by both countries [26]. This distinguished them from other Chinese agricultural investors [41,42] that run their businesses under less supervision in Laos. Additionally, we found that these companies came from the border areas of Yunnan Province, and over four-fifths of them were privately owned, leading to various difficulties such as small-scale, inadequate capital, and weak resistance to market risk. Furthermore, these limits also raised technical and talent bottlenecks, the high homogenization of investment mode, and repetitive competition for the same regional agricultural and labor resources. The above challenging issues could have a negative influence on investment outcomes. It is possible to consider how to break through these bottlenecks so as to improve investment performance in the future.

4.2. Improving Company’s External Environment on Policy Support and Market Incentives

Policy supports play an important role in improving the performance of foreign investments, especially when considering that agricultural tax incentives are attractive to foreign investors [43,44]. Our results showed that a policy environment was critical for the success of the surveyed companies. The investment period between 2001 and 2010 (Table 2) was generally consistent with the Chinese government’s supports of financial subsidies and tax waivers since 2006 [19,26]. However, the policy support tended to be selective given only 6% of the surveyed companies continued their investments after 2010 (Table 2). This period coincided with an improved assessment of the companies in the OPA programs by the Chinese government, and a policy incentive for further supporting strongly performing OPA companies [26]. Meanwhile, the Sino-Laos support policies for agricultural product exports and the lower costs of cross-border logistics contributed to company development as well. The communication at the government level bridges the gaps in program understanding between local authorities [19,26]. It is worth noting that over 87% of the surveyed companies expressed that policies were essential. This finding supports the view that government intervention is a potential determinant of a competitive advantage in a global production network [45].

More importantly, market incentives play a significant role in investment success. In the cases of illicit crop alternative programs in Myanmar, Afghanistan, and Colombia, the lack of marketing channels for agricultural products and the limited income sources of farmers were among the most critical factors responsible for the unsustainability of licit products [25,46]. We can infer that it is difficult for small farmers to explore market channels for their agricultural products or to confront variable market risks. It is well recognized that the CBAIs for the OPA is a market-based approach [19,26], and in essence, the OPA provides a market-driven force for local agricultural economic development due to policy supports and company-led processes. As our results showed, over 90% of the companies had a high-level or moderate level of investment benefits. All of the companies have conducted market research to collect information, which further assured the sustainable market for agricultural products. Additionally, our results showed that the pioneering companies established agro-processing factories and marketing sites, demonstrating that these companies have gradually diversified their investments to expand external market access, which also provides the possibility for companies to improve their competitiveness and acts as a motivation for farmers in terms of agricultural production.

However, we contend that there are great challenges for company investments. Many studies with a specific focus on reducing illicit crop cultivation confirmed that poverty and illicit crop cultivation continued to be serious problems, even when eradication actions or legal crop programs were conducted, since these approaches could not fundamentally remove socio-economic and institutional limits [24]. Even company-led programs are ineffective in dealing with these issues because some agriculturally viable legal crops are not economically beneficial, while others are not competitive with legal crops produced elsewhere due to the impact of transportation or intermediate costs [47]. On the basis above, it is recommended that the companies, before their engagement in agricultural investments, should fully consider the social, economic, cultural, and ecological conditions in foreign countries or explore public–private partnership approaches that rely on the multiple roles of policy support [48] and market demand to offset natural and social risks.

4.3. Improving Company’s Corporate Social Responsibilities

The companies’ social responsibilities contributed greatly to their investment success. Evidence showed that adequate infrastructures could improve income equality, economic growth, employment, and agricultural productivity [32,33]. The companies who have made investments in improving rural infrastructure have played an active role in improving living and production conditions. Moreover, an emphasis on vulnerable groups in education, healthcare, and poverty assistance have strengthened farmers’ trust in investors, improving farmers’ understanding of foreign companies and facilitating mutual communication. The companies have also made tremendous efforts to improve farmers’ capacities. In the cases of Afghanistan, Peru, and Colombia, the forcible eradication of poppy affected the livelihoods of farmers and did not provide them with the capacity for possible development [49,50]. Our research revealed that key agricultural experts were introduced to conduct skills training, which improved farmers’ adaptiveness of technology and facilitated the diffusion of appreciated technologies to farmers. This effort could solve some of the problems in community-based alternative development, such as the lack of expert-guided technology application [19]. In particular, the companies have provided plentiful employment opportunities, significantly promoting poverty alleviation and improving rural livelihoods. All of these good practices act as an intangible asset that have improved the external legitimacy and reputation of companies and have increased the possibility of investment success.

We agree with the positive role of a company’s social responsibility in investment success, as these measures have facilitated the trust between the companies and local farmers. However, the sustainable development of alternative poppy cultivation projects is expected to provide economic benefits to local farmers, as well as to cultivate local talent to promote socio-economic development. If companies put too much emphasis and capital on local public services, they will neither be able to change the structure of social economic systems, nor to promote agricultural projects in the long term. Instead, they might weaken market function and take on a heavy burden. The results showed that although increased social investments could be an effective strategy for the control of illicit crops [51], the emphasis on international cooperation and providing financial and technical assistance to change the local socioeconomic structure is still crucial for the reduction of poppy cultivation [23]. It is recommended that local authorities make efforts to improve infrastructures and public services, creating a favorable environment for foreign investors with a long-term goal of rural development.

5. Conclusions

The main objective of this study was to examine the profiles and practices of OPA companies and to shed light on novel research perspectives on success factors that support the development of CBAIs in the OPA. Key informant interviews and questionnaire surveys were used to explore company practices and experience in foreign investments in the BRI context. We also took cases of investment failure into account in the key informant interviews. This research was conducted to analyze the internal factors and external conditions impacting investment performance from the perspective of Chinese cross-border agricultural companies. Contrary to previous studies, we first took into account different indicators, including investor managment, plans, training, cross-cultural communication, and reponses to policy and market changes. We found that the success of agricultural companies in the OPA project largely depended on three key factors, namely (1) institutional and employee capacities, (2) responses to policy and market incentives, and (3) support for community development (e.g., communication with farmers, farmer skill training, loving care for vulnerable groups, and infrastructure improvement).

The theoretical implication of the research can be concluded as the promotion of capacity building by foreign investors for the improvement of international agricultural investment. This is also practical for the companies that made CBAIs in the OPA. We suggest these companies should make great efforts to improve internal management, adapt to external environments, and perform social responsibilities. Additionally, based on our findings, policy makers could make efforts to improve infrastructures and public services, and then create a favorable policy environment for investors. Our analyses concerning the success factors of CBAIs are currently on a regional basis, but the findings are commonly applicable to other regions facing similar challenges. Additionally, we focused on qualitative analyses from the companies’ perspectives. Further studies could be conducted by including quantitative analyses from the farmers’ perspectives and by considering company–farmer interactions, such as mutual trust building, the selection of appropriate technology, and knowledge diffusion in other transnational contexts. Future in-depth studies are expected to draw more general conclusions to improve the sustainability of international agricultural cooperations.