The Belt and Road Initiative

Written by Menghan Huang

In the first century BC, the silk came into the Roman Empire. Silk is regarded as quite exotic luxury goods and became extremely popular, it was both a typical fabric used by the royal household and an important source of finance. Therefore, silk has become one of the motivations of commercial development in Europe to the Far East.

China Emperor has successively sent Zhang Qian twice to western regions as serve as an envoy abroad (from 140 BC to 126 BC) and (from 119 BC to 115 BC), established a silk road which from the ancient capital of China Chang’an, by way of the Central Asian countries, such as Afghanistan, Iran, Iraq, Syria and other places to the Mediterranean, to Rome as the end. At the same time, due to the need of trade, people established the Maritime Silk Road, from Guangzhou as a starting point to the end of Venice. Thus, the door of friendly exchanges between Asian and European countries has been opened.

Rebuilding “the Belt and Road” Initiative (“the Silk Road Economic Belt and the 21st Century Maritime Silk Road”), aimed at driving the orderly and free flow of economic elements, resource efficient configuration and market depth integration, promoting economic policy coordination in countries along the Silk Road, carrying out a wider, higher level, deeper inter-regional cooperation, working together to build an open, inclusive, balanced, generally benefit structure of regional economic cooperation, and thus promoting the development of strategic docking and coupling in countries along the road.

mappa belt and road

The route map of “the Belt and Road” Initiative

It is necessary to consider those Chinese companies which are active in international transport, energy, financial and telecommunication infrastructure in Asia, Europe or Africa. China’s action and other official communications on “the Belt and Road” initiative make it clear that the formal purpose of “the Belt and Road” Initiative is supposed to contribute an international economic development by strengthening its “connectivity”.

Formal “the Belt and Road” initiative projects in the EU often involve container terminals and railways. Among the port projects, the port of Piraeus in Greece stands out as the most prominent case. China’s shipping and logistics giant China Ocean Shipping Company (COSCO) has been operating and modernizing part of the port since 2009, and COSCO greatly expanded its involvement in summer 2016 when it acquired a controlling share in the Piraeus Port Authority. With regard to the railways, the planned construction of a new Belgrade–Budapest railway by Chinese companies is  signal which related to “the Belt and Road” Initiative.

According to WTO’s statistics, in the first three quarters of 2017, China’s import increment has contributed 17% to the global import growth, China's imports has also accounted for 10.2% of the global share.

Certainly, “the Belt and Road” initiative brought not only a real road crosses from China to Europe, but also included the connotation of digital infrastructure across Eurasia. It will extend our acknowledges from the traditional geopolitical concept to the scope of biosphere cooperation, this is a kind of distributed system which made by shared spirits and technological revolutions.

On 2th April, "The belt and road" initiative cross-border cooperation seminar was held in Shanghai, Chinese and foreign bankers have been gathering together to discuss the financial cooperation under the "the belt and road" initiative. At that day, Shanghai Bank signed an agreement to further deepen strategic cooperation with OCBC Group of Singapore and Santander Group of Spain to provide a broader range of financial services for companies in various countries.

JinYu, chairman of Shanghai Bank, expected in the next 5 years, investments of "The Belt and Road" initiative will increase further, there will be a huge amount of banking business demand in terms of cross-border finance, project financing, investment banking, etc. Objectively, banks are required to carry out the extensive cooperation with various institutions at all levels and in all fields to enhance their comprehensive service capabilities.

The development of “the Belt and Road” in different filed will provide a broader market and create more valuable opportunities to various countries of the world.