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One Belt and One Road Initiative, the new Silk Road

Wednesday, 31 July 2019 - 11:00 am (CET/MEZ) Berlin | Author/Destination: Around the World / Rund um die Welt
Category/Kategorie: General Reading Time:  10 minutes

🔊 Listen to this Post The Belt and Road Initiative (BRI) is a development strategy adopted by the Chinese government involving infrastructure development and investments in 152 countries and international organizations in Europe, Asia, Middle East, Latin America and Africa. “Belt” refers to the overland routes for road and rail transportation, called “the Silk Road Economic Belt“; whereas “road” refers to the sea routes, or the 21st Century Maritime Silk Road. It was known as the One Belt One Road (OBOR) and the Silk Road Economic Belt and the 21st-century Maritime Silk Road until 2016 when the Chinese government considered the emphasis on the word “one” was prone to misinterpretation. The Chinese government calls the initiative “a bid to enhance regional connectivity and embrace a brighter future”. Some observers see it as a push for Chinese dominance in global affairs with a China-centered trading network. The project has a targeted completion date of 2049, which coincides with the 100th anniversary of the People’s Republic of China.

The stated objectives are “to construct a unified large market and make full use of both international and domestic markets, through cultural exchange and integration, to enhance mutual understanding and trust of member nations, ending up in an innovative pattern with capital inflows, talent pool, and technology database.” The initial focus has been infrastructure investment, education, construction materials, railway and highway, automobile, real estate, power grid, and iron and steel. Already, some estimates list the Belt and Road Initiative as one of the largest infrastructure and investment projects in history, covering more than 68 countries, including 65% of the world’s population and 40% of the global gross domestic product as of 2017. The Belt and Road Initiative addresses an “infrastructure gap” and thus has potential to accelerate economic growth across the Asia Pacific area, Africa and Central and Eastern Europe: a report from the World Pensions Council (WPC) estimates that Asia, excluding China, requires up to US$900 billion of infrastructure investments per year over the next decade, mostly in debt instruments, 50% above current infrastructure spending rates. The gaping need for long term capital explains why many Asian and Eastern European heads of state “gladly expressed their interest to join this new international financial institution focusing solely on ‘real assets’ and infrastructure-driven economic growth”.

The Belt and Road Initiative is geographically structured along several land corridors, and the maritime silk road. Infrastructure corridors encompassing around 60 countries, primarily in Asia and Europe but also including Oceania and East Africa, will cost an estimated US$4–8 trillion. The initiative has been contrasted with the two US-centric trading arrangements, the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership. These programs aimed at encompassing countries, financially, receive the support of Silk Road Fund and Asian Infrastructure Investment Bank; technically, are guided by B&R Summit Forum. The land corridors include:

• The New Eurasian Land Bridge, which runs from Western China to Western Russia through Kazakhstan, and includes the Silk Road Railway through China’s Xinjiang Autonomous Region, Kazakhstan, Russia, Belarus, Poland and Germany.
• The China–Mongolia–Russia Corridor, which will run from Northern China to the Russian Far East. The Russian government-established Russian Direct Investment Fund and China’s China Investment Corporation, a Chinese government investment agency, partnered in 2012 to create the Sino-Russian Investment Fund, which concentrates on opportunities in bilateral integration.
• The China–Central Asia–West Asia Corridor, which will run from Western China to Turkey.
• The China–Indochina Peninsula Corridor, which will run from Southern China to Singapore.

The Silk Road Economic Belt (SRB) is the overland interconnecting infrastructure corridors. When Xi Jinping visited Astana, Kazakhstan, and Southeast Asia in September and October 2013, he spoke of jointly building a Silk Road Economic Belt and a 21st-Century Maritime Silk Road. Essentially, the “belt” includes countries situated on the original Silk Road through Central Asia, West Asia, the Middle East, and Europe. The initiative would create a cohesive economic area by building infrastructure, increasing cultural exchanges, and broadening trade. Outside this zone, which is largely analogous to the historical Silk Road, is an extension to include South Asia and Southeast Asia. Many of the countries that are part of this belt are also members of the China-led Asian Infrastructure Investment Bank (AIIB). North, central and south belts are proposed. The North belt would go through Central Asia and Russia to Europe. The Central belt passes through Central Asia and West Asia to the Persian Gulf and the Mediterranean. The South belt runs from China to Southeast Asia, South Asia, to the Indian Ocean through Pakistan. The Chinese One Belt strategy will integrate with Central Asia through Kazakhstan‘s Nurly Zhol infrastructure program.

The 21st Century Maritime Silk Road, or just the Maritime Silk Road, is the sea route ‘corridor’. It is a complementary initiative aimed at investing and fostering collaboration in Southeast Asia, Oceania, and Africa, through several contiguous bodies of water: the South China Sea, the South Pacific Ocean, and the wider Indian Ocean area. It was first proposed in October 2013 by Xi Jinping in speech to the Indonesian Parliament. Like the Silk Road Economic Belt initiative, most countries have joined the Asian Infrastructure Investment Bank.

In addition to the Maritime Silk Road, Russia and China are reported to have agreed jointly to build an ‘Ice Silk Road’ along the Northern Sea Route in the Arctic, along a maritime route which Russia considers to be part of its internal waters. China COSCO Shipping Corp. has completed several trial trips on Arctic shipping routes, the transport departments of both Russia and China are constantly improving policies and laws related to development in the Arctic, and Chinese and Russian companies are seeking cooperation on oil and gas exploration in the area and to advance comprehensive collaboration on infrastructure construction, tourism and scientific expeditions.

The super grid project aims to develop six ultra high voltage electricity grids across China, north-east Asia, Southeast Asia, south Asia, central Asia and west Asia. The wind power resources of central Asia would form one component of this grid.

The Asian Infrastructure Investment Bank, first proposed in October 2013, is a development bank dedicated to lending for infrastructure projects. As of 2015, China announced that over one trillion yuan (US$160 billion) of infrastructure related projects were in planning or construction. The primary goals of AIIB are to address the expanding infrastructure needs across Asia, enhance regional integration, promote economic development and improve the public access to social services. The Articles of Agreement of the Asian Infrastructure Investment Bank (AIIB), (the legal framework) were signed in Beijing on June 29, 2015. The proposed bank has an authorized capital of $100 billion, 75% of which will come from Asia and Oceania. China will be the single largest stakeholder, holding 26% of voting rights.. The board of governors is AIIB’s highest decision-making body. The bank began operation on January 16, 2016, and approved its first four loans in June. In November 2014, Xi Jinping announced a US$40 billion development fund, which would be separate from the banks and not part of the CPEC investment. The Silk Road Fund would invest in businesses rather than lend money to the projects. The Karot Hydropower Project, 50 km (31 mi) from Islamabad, Pakistan is the first project. The Chinese government has promised to provide Pakistan with at least US$350 million by 2030 to finance this station. The Sanxia Construction Corporation commenced work in January 2016.

A university alliance centered at Xi’an Jiaotong University aims to support the Belt and Road initiative with research and engineering, and to foster understanding and academic exchange. The network extends beyond the economic zone, and includes a law school alliance to “serve the Belt and Road development with legal spirit and legal culture”.

Read more on gov.cn – Belt and Road Initiative, History of China, Economic history of China, Human rights in China, Economy of China, Foreign relations of China, Politics of China, Censorship in China, People’s Liberation Army and Wikipedia Belt and Road Initiative (Smart Traveler App by U.S. Department of State - Weather report by weather.com - Global Passport Power Rank - Travel Risk Map - Democracy Index - GDP according to IMF, UN, and World Bank - Global Competitiveness Report - Corruption Perceptions Index - Press Freedom Index - World Justice Project - Rule of Law Index - UN Human Development Index - Global Peace Index - Travel & Tourism Competitiveness Index). Photos by Wikimedia Commons. If you have a suggestion, critique, review or comment to this blog entry, we are looking forward to receive your e-mail at comment@wingsch.net. Please name the headline of the blog post to which your e-mail refers to in the subject line.

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