New Silk Road update

WSJ:

Opening a two-day meeting with leaders from 29 countries and officials from dozens more on hand, President Xi Jinping said Sunday his plan to knit Asia, Europe and Africa more closely through infrastructure will require going beyond economic and financial arrangements. To ensure success, he said, countries should give up old alliances and create a new international security framework. Mr. Xi portrayed China as a committed free trader and pledged more than $100 billion in new financing and assistance for projects and countries involved in an updated revival of ancient Silk Road trading routes.

This Silk Road reboot, known as “One Belt, One Road,” — which envisions constructing networks of ports, railways, pipelines and industrial parks — is Mr. Xi’s grandest foreign-policy initiative. Mr. Xi said over the last three years China has invested more than $50 billion in Silk Road countries, and Chinese officials have branded the venture as a new form of globalization, one that is more inclusive and fairer than previous tides of world commerce. Its two-year-old Asian Infrastructure Investment Bank inducted seven new members this weekend, including Bahrain, Greece and Bolivia, bringing the total to 77.

This is called turning a problem into an opportunity. China has vast overcapacity in infrastructure industries like cement and steel. Putting that overcapacity to use in helping build and finance major infrastructure projects for its neighbors is smart both politically and economically.

Bonus fun update: Mr. Putin will attend the meeting, but the NYT didn’t detail which election they will try to rig.

3 Responses to “New Silk Road update”

  1. feeblemind Says:

    re China has vast overcapacity in infrastructure industries like cement and steel. Putting that overcapacity to use in helping build and finance major infrastructure projects for its neighbors is smart both politically and economically.

    Ok. I agree with that statement in the abstract, but what if the neighbors can’t pay them back? Or is the money immaterial?

  2. feeblemind Says:

    Wrect is weighing in today on the topic.

    He says:

    While the West was busy guarding against the perils of climate change and politically incorrect attitudes, China stole a march on it by starting on their Silk Road project. “Europeans are just beginning to come grips with the realization that China’s ‘One Belt, One Road’ may be more than just an economic opportunity. The ambitious mix of economic, infrastructure and diplomatic initiatives—paired with a maritime road from the South China Sea to the Port of Piraeus—aims to create a new “silk road” from Yiwu in central Zhejiang Province to Madrid, Spain.”

    For the United States the prospect of a high capacity land logistics corridor through the Eurasian landmass means that China would be less vulnerable to maritime blockade, especially by naval forces in the Indian Ocean. It also raises the prospect of a new bipolar world, one where for the first time the US could potentially be the weaker state.

    To the many impoverished countries along planned Silk Road route — many of them Islamic — Beijing’s announcement simply means a potential windfall. “Behind China’s trillion-dollar effort to build a modern Silk Road is a lending program of unprecedented breadth, one that will help build ports, roads and rail links, but could also leave some banks and many countries with quite a hangover.” China is offering — some say giving away — money which many of these countries probably have no hope of paying but they’ll take anyway.

    https://pjmedia.com/richardfernandez/2017/05/16/suddenly-the-silk-road/

  3. feeblemind Says:

    Another blogpost on the silk road.

    It is interesting though I am not sure I agree with it all.

    From the post:

    Summary: US borrows trillions to wage war in foreign lands. China helps build other nations’ transportation infrastructure to connect them for mutual trade. Which program will work better?

    https://fabiusmaximus.com/2017/05/16/china-infrastructure-one-belt-one-road/

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