Many years ago, traders moved their goods along a network of roads stretching from China to Europe. Dubbed the Silk Road, these trading routes influenced the development of an entire region. Now, 2,000 years later, China is once again establishing vast and powerful trade networks with the One Belt, One Road (OBOR) initiative.
What exactly is the One Belt, One Road?
The OBOR is an economic and diplomatic scheme that could become the largest platform for economic cooperation in the world.
In the physical sense, the modern day version of the Silk Road consists of roads, pipelines, railways, bridges, ports, and power plants. Many of these have yet to be built - the plan pivots on the large-scale construction of infrastructure. Initially proposed by President Xi in 2013, OBOR will come with an estimated price tag of $5 trillion as China paves trading routes across Asia, the Middle East, and Europe.
The initiative is comprehensive. The ‘One Belt’ refers to pathways of trade across continental Asia and Europe, while ‘One Road’ is the maritime corridor connecting the countries involved.
It’s also ambitious. Nearly 70 countries have signed on for the global trade and infrastructure initiative, and individual OBOR projects number into the thousands.
What is the purpose behind the initiative?
The initiative reflects President Xi’s dream to rejuvenate China as a country that is both prosperous and internationally engaged - in his words, “The Chinese Dream”.
This is a change of direction from Deng Xiaoping's strategy of maintaining a low profile, to “hide our capabilities and bide our time, never try to take the lead”. Indeed, OBOR has an openly outward focus, both advancing regional integration and increasing dependence on China as a trade behemoth. China has been the world’s largest trading nations since 2013, and OBOR initiative seems to be a move to solidify preference for Chinese exports.
However, the OBOR isn’t solely designed to benefit China. Key investments and development as part of the initiative are supposed to enhance the productivity of the whole region, allowing all the countries involved to enjoy the strength of cooperation. President Xi himself said the goal is to create “a big family of harmonious co-existence”.
What does the OBOR look like so far?
The OBOR project is a giant leap toward globalisation. All up, the 65 nations involved (including China) account for nearly two thirds of the world’s population and one third of global economic output.
The sheer scale of the project has raised some eyebrows as to the likelihood of its success, with both coherence and practicality called into question. However, with help from the $40 billion state owned Silk Road Fund and support from banks, OBOR is powering ahead.
One of the greatest influences it is expected to have is development in emerging markets - many of the countries OBOR will pass through lack the proposed transport infrastructure. So far, gas pipelines across Asia and a high-speed railway linking China and Singapore are some of the largest projects of note. Rail connections have also been made with Laos, Thailand, and Iran, with the possibility of stretching all the way to Europe. There is no comprehensive summary of OBOR projects, but around $500 billion of infrastructure projects were announced in 2016.
The project as a whole is still far from being realised and thus the long term influence of the OBOR remains to be seen, but one thing is clear: China continues to be the country that connects the world. Ambitious foreign policies such as One Belt, One Road explicitly reveal that China is at the forefront of the world in international trade.