Question

Describe the history of the New Silk Road (also known as One Belt One Road (OBOR), Belt Road Initiative (BRI)) and Chinese economic and political motivations underlying the various initiatives

Analyze an example of an OBOR project in Africa, in Latin America and in Asia.

How do you synthesize your learning of OBOR with your learning on globalization?

Answer 1

With the growing influence of western powers, it is important for countries to seek regional affiliations that enable them enhance their productive capacity and at the same time give them the strength to combat daunting global influences. BRI is an ambitious project that aims to enhance China's integration with its trading partners by way of improved means of transport. The BRI can be regarded as an extension of the Ancient Silk Route that was primarily used to transport Chinese silk to Europe, Africa and South-West Asia.

China has build a reputation of a leading exporter of manufactured goods and is also a major FDI destination. The economic reforms that were effected from 1978 enabled China to attain economic growth and increase its integration with the rest of the world.

China, that imported technology from Japan and utilised it in developing key sectors, has a trade surplus with Japan today. Further, China's trade surplus with the US has always been a matter of debate. China's tactical devaluation of the yuan has also been subject to criticism. Nonetheless, China has been consistently looking to seek opportunities in international markets for strengthening its position in the world. The following points on the BRI need to be noted :

- China is funding these projects worldwide by offering loans at 2-3% interest rates; many times expensive than Japan's.

-The contractors of these projects are Chinese and not local businesses.

- The projects have the tendency to increase debts of partner nations particularly the less developed ones. For instance, Sierra Leone recently cancelled a China funded airport project as it was found to be unnecessary.

BRI PROJECTS IN LATIN AMERICA:

CHILE: China State Power Investment Corporation invested in Chile to build the 1st Hydro Wind farm in the Pacific region. It has contributed to electricity generation in the region.

BRI PROJECTS IN AFRICA:

NIGERIA: China Civil Engineering Construction Corporation built the Abiya- Kaduna railway in Nigeria that became operational in July, 2016. It is in accordance with the Chinese railway standard, the first of its kind.

BRI PROJECTS IN ASIA:

BANGLADESH: China Railway Major Bridge Engineering group is building a bridge over the Padma river that is expected to reduce travel time from Dhaka, the capital of Bangladesh, and the southern city of Khulna by 10 hours.

China's idea is to create mutually beneficial channels of business that can be capitalised upon in the event of abrupt changes in the global economic scenario. While economic partnerships of such a magnitude might seem productive on the surface, it is important to weigh the opportunities against the possible threats that might be encountered in their implementation. Globalisation has created immense opportunities for economic integration. Transportation, communication have become easier and faster due to information technology. As nations look to enhance ties with their trading partners, it has become increasingly important to give weightage to country specific concerns. Thus, even as BRI has the potential to create an incredible network of trade across borders, it will be valuable only when it is flexible enough to incorporate the interests of every party to it.