One Belt, One Road: China’s Next Big Project
More than 2,000 years ago, the region of today’s China was isolated from civilizations of the West. Having mastered the production of unique goods such as silk, porcelain, paper, gunpowder and spices, the Chinese Han dynasty was able to pave new trade routes by splitting their only two overland roads. This exchange of goods and ideas along a road network between China with Central Asia, the Middle East, Africa and Europe became what is known today as the Silk Road, one of the most significant trading milestones in history.
Today, this ancient trading route is now being revived with an initiative by Chinese President Xi Jinping, who is looking to reshape global trade and encourage economic cooperation between Eurasian countries. With an estimated budget of more than $1 trillion in infrastructure, the Belt and Road Initiative (BRI) consists of a network of upgraded highways, railways, and ports that is projected to extend into a least 71 countries.
What Xi describes as “the project of the century”, is divided into two components. The Silk Road Economic Belt, based on the original Silk Road, consists of the belt that connects China with Southeast Asia, South Asia, West Asia, Middle East and Europe. The second segment, called the 21st Century Maritime Silk Road, refers to a sea route connecting Asia, Africa and Europe.
During the Belt and Road Forum in May 2017, President Xi spoke about the project’s desired goals, which include increased financial gains, trade, strengthened infrastructure and policy, and people-to-people connectivity. Founder and Executive Chairman of the World Economic Forum Klaus Schwab expressed, “the One Belt and One Road initiative is a pioneering, international framework based on an ‘open platform concept’ which does not need a leader but a curator who acts as a catalyst and coordinator for ensuring win-win outcomes.”
In terms of risks, there have been concerns regarding potential financial implications for countries involved in BRI projects. According to a study by the Center for Global Development, out of the 23 countries identified as at risk, 8 in particular could suffer from debt distress in relation to BRI financing. Some of these countries include Pakistan, Mongolia, Laos, Djibouti, Kyrgyztan and the Maldives. This would certainly call for cautious and balanced lending protocols between China and other countries involved in order to avoid such financial risks.
With the intention of promoting economic collaboration and development, the Belt and Road Initiative hopes to deliver a significant revolution in infrastructure, but will it be the economic game-changer of the 21st century that it promises to be? We are looking forward to seeing how it will gradually unfold into our modern-day Silk Road, and how it will contribute to a better and more connected world.
Hurley, J. Morris, S. Portelance, G. (2018 March) Examining the Debt Implications of the Belt and Road Initiative from a Policy Perspective. Retrieved from: https://www.cgdev.org/publication/examining-debt-implications-belt-and-road-initiative-a-policy-perspective
The Editors of Encyclopedia Britannica. Silk Road. Retrieved from: https://www.britannica.com/topic/Silk-Road-trade-route
Tweed, D. (2018, August 23) China’s New Silk Road. Retrieved from: https://www.bloomberg.com/quicktake/china-s-silk-road
Kuo, L. Kommenda, N. What is China’s Belt and Road Initiative? Retrieved from: https://www.theguardian.com/cities/ng-interactive/2018/jul/30/what-china-belt-road-initiative-silk-road-explainer