BRI-The New Silk Road and the Paradigm shift in the World Trade
Hear the term Silk Road and the first thought/visual that crosses one’s mind is that of the mighty Chinese Dragon spreading its humongous wings throughout the European seas! A quick reference should help to brush up the topic – The term Silk road is coined from the lucrative trade of Silk carried out through a particular route commencing from period of the Han Dynasty of China. The Silk Road was a grid of trade routes which inter-connected the East and West, and was central to the socio-economic & Geopolitical interactions, practices & belief between these regions in the ancient time. China being at the center of the Manufacturing Industry is a subject that needs no introduction but only if one deep dives just a little bit, it would help to understand that it was never just designed to be that way right from day-1. There have been significant policies and strategies that were meticulously planned and executed by the Chinese to help them reach the pinnacle of Manufacturing and become the 2nd most dominating Economy of the World today.
But the Silk road is a history now and the present day story is more about the highly ambitious - Belt and Road Initiative of the Chinese govt. which is highly ambitious game plan to evolve internationally that has been adopted by the Chinese government involving infrastructure development and investments in 152 countries and international organizations in Asia, Europe, Africa, the Middle East, and the Americas. "Belt" refers to the overland routes for road and rail transportation, whereas "road" refers to the sea routes.
The BRI is an ambition and policy that was announced by Chinese President Xi Jinping in 2013 and will reach completion in 2049 (exactly the 100th Anniversary of the Communist Party of China). There have been a lot of factors that makes this initiative so crucial, exciting and all the more beneficial for the entire world as it proposes to service an area that is home to about 70% of the world’s population, produces about 55% of global GDP and has about 75% of known energy reserves.
1. One corridor, One community
The BRI is the biggest Infrastructure Project till date and Poland and CEE are on this strategic multi-dimensional system. Today, the initiative involves infrastructure development and investments in 152 countries and international organizations in Europe, Asia, Middle East, Latin America and Africa. The BRI proposes countries to better integrate with other markets. The bigger picture is that of a community formation of BRI members. China visions in the development a historic opportunity – for Asia, Africa and Europe. Also the initiative encourages the Countries in these regions, including Europe to enrich their own plans to accelerate trade and economic development.
2. Enhanced Connectivity
Time is testimony for - how all the Industrial Revolutions have been enabled and powered by the Connectivity be it the First Industrial Revolution through the possibility to transport raw materials to the United Kingdom that brought gradually a growing number of nations to the opportunity of global trade. It was digital connectivity brought about by the Third Industrial Revolution that enabled offshoring. And it is connectivity between different technologies that created the Fourth Industrial Revolution. The BRI improves connectivity and hence increase international trade. Currently, shipping goods from China to CEE takes about 30 days. Shipping goods by train cuts transit time in half. In Africa, port development is driving economic hubs that better connect the landlocked countries with the important sea-gateways.
3. Enabling Nations to Realize and unlock their Growth Potential
According to the World Bank facts and figures the contribution of BRI countries to global exports has nearly doubled in the last two decades. But more can be achieved. “Trade of many BRI economies such as Afghanistan, Nepal, Tajikistan, and Laos is below potential due to inadequate infrastructure, weak policy and other gaps. The BRI can help to fill these gaps, boosting international commerce”. The BRI can result in a much more inclusive approach to trade by boosting cross-border commerce in all nations along the corridors. Improved connectivity and increased economic activity can be the beginning of larger industrialization along the belt and road routes.
With President Trump signalling that “he could declare the Ongoing Trade war between the US and the China a National Emergency if he wishes” this is certainly clouding the ongoing G7 Summit in France as the Top Two economies of the World are showing no signs of relaxing the tit-for-tat tariffs between the Washington and Beijing bilateral trade. The US China Trade war is pushing the Chinese to accelerate the globalization of their Economy like never before and this is definitely in some or the other way going to benefit the participating nations in BRI to boost their Infrastructure projects, scale their economies and improve their trade when it comes to Supply Chain. Shipping industry has long been the lifeline of the global economy and trade. There is no second thought that about Transportation being an inevitable to part of any business since time immemorial. It all starts with the complex maze of “Global Demand and Supply” At LOTUS Containers we already are serving our clientele along the proposed BRI route and we have numerous clients that have already benefitted from our unique offerings and products such as the BOOK-A-BOXX Online Solution, where our registered customers can book container equipment online by just a few clicks. Our world class team of professionals is all geared up to serve your most crucial and challenging requirements and have been doing so since last decade of our inception.