Have you heard of the One Belt One Road Initiative yet? The name Silk Road probably sounds familiar to you. It refers to the ancient trade route which connected China and the West. But are you familiar with China’s new multi-trillion USD effort to build The New Silk Road? It is also known as Belt and Road Initiative (BRI).
So, in this week’s blog article, China Gravy reveals all you need to know about the BRI. Plus, we describe the resulting digital business opportunities for you in China and the world! Discover how China’s One Belt One Road holds Digital Business Opportunities for You!
Unlock the great potential of the New Silk Road to skyrocket your business at home and abroad!
Silk Road – An Inspiring History
First of all, the Silk Road was an ancient network of trade routes to connect the East and the West. It was central to the economic, cultural, political, and religious interactions between these regions. And it was active from the 2nd century BCE to the 18th century.
The name “Silk Road” or “Silk Route”, dates back to the lucrative trade in silk by the Han Dynasty.
In fact, the Silk Road continued to prosper over the course of almost 2,000 years. Finally, it was destroyed together with the collapse of the Safavid Empire (Iran) in the 18th century.
Entering the 21st century
So, in the 21st century, the ancient Silk Road is revived. Announced in 2013 by China’s President Xi Jinping, the BRI shall reopen the trade corridor between China and the West. China’s 900 billion USD initiative shall essentially link Central Asia, the Middle East, and Europe.
In the long run, the One Belt One Road investments shall positively influence the EU’s political and economic positioning on a global scale. However, EU member states are divided on the BRI. France and Germany have not signed up for the BRI yet. Whereas Italy and many smaller member states have done so.
Likewise, over the big pond, the current trade war around tariffs between the US and China might just be a preview of what’s ahead. China’s increasing power through the BRI (infrastructure, politics, economy, military) is likely to lead to a decline in America’s global influence in the years ahead, according to analysts.
China’s New Belt and Road Initiative (BRI)
As stated in the Belt and Road Action Plan released in 2015, the new initiative will include land routes (the Silk Road Economic “Belt”) and maritime routes (the 21st Century Maritime Silk “Road”). The One Belt One Road map impressively showcases the extensive reach of China’s New Silk Road.
As the Chinese government explained recently, the goal is to start a “new era of globalization”. This will benefit all and create new jobs. In fact, the Belt and Road Initiative is estimated to impact 60% of the World’s Population and to collectively account for 30% of the world’s global GDP.
In other words, 68 countries will directly benefit from improved infrastructure with a total investment of up to 8 trillion USD, according to Beijing. And another Sixty-two countries could see investments of up to 500 billion USD over the next years.
Likewise, there are estimates that trade along the Silk Road could soon account for almost 40% of total world trade.
The Digital Silk Road
The Second Belt and Road Forum took place in April 2019. World leaders gathered in Beijing to discuss bilateral project opportunities, including the emerging Digital Silk Road. This was of particular interest to several global Fortune 500 companies.
In fact, the Digital Silk Road aims to bring new technological opportunities to emerging economies in Asia and around the world. For instance, this includes Artificial Intelligence, a global satellite navigation system, and a high-speed internet connection.
The increasing use of e-commerce and mobile payments showcase a more relatable and practical effect of the New Silk Road initiative.
Companies like Alibaba, Tencent (WeChat), and Didichuxing invest several hundred million USD in online and mobile payment systems, everyday mobility (Grab), delivery (Singapore Post), and communications services.
The Challenges around China’s Belt and Road Initiative
The challenges are complex and include interlinked bottlenecks in infrastructure, financial markets, trade facilitation, trade barriers, and limited regional cooperation. With the overcome of these barriers, there is a significant potential for growth regionally and globally.
According to a 2016 report from the German Development Institute / Deutsches Institut für Entwicklungspolitik (DIE), the major challenges can be summarized as follows:
- Improving transport and energy connectivity is crucial for greater economic integration. In particular, there is an unexploited potential for energy trade.
- Building cross-regional coordination institutions, such as cooperative planning and implementation processes, is a major challenge. Even more so, when coordination policies include two or more countries.
- The biggest opportunity lies in overcoming trade barriers, such as Non-Tariff-Measures, services, competition policy, intellectual property protection, and politically sensitive goods such as agriculture.
- To make sure that infrastructure investments reduce trade-related costs, trade facilitation measures are essential. Customs activity has the most visible impact on increasing the time and cost of moving through borders. However, border transaction costs (e.g. port facilities, documentation, immigration, and quarantine requirements) must also be considered.
Digital Business Opportunities for You
Transfer of know-how, awareness of consumer behavior trends, and operationalization in the digital economy have provided opportunities for growth for digital-based companies.
Discover how China’s One Belt One Road holds Digital Business Opportunities for You!
Entering the Growing Chinese Market
No matter which products, or services your business offers, unlock the financial potential of China’s BRI and its multi-trillion USD investment.
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- Enter the unique and complex market in China with smart integrated marketing strategies.
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Reach Millions of Potential Customers
Today, the number of internet users in China exceeds 800 million. As a result, China is the world’s largest online community. Together with an annual GDP growth rate of over 6% in China, this makes it one of the most attractive markets in the world.
Now add the One Belt One Road multi-million USD investment in industries like mobile payment, communication services, and everyday mobility. As a logical consequence, these numbers will skyrocket even further.
In conclusion, your business can access this target audience with attractive multilingual content on Chinese and Western Social Media Platforms and WeChat Advertising.
Your digital marketing agency can help you to save time and energy on this. From research and content creation to initial setup and regular maintenance, China Gravy is ready to help!
Finally, we successfully apply a hybrid model, which integrates digital marketing on Western and Chinese Social Media Platforms. We are also happy to create a good website for you, which is tailored to fit the needs of your target audience.
One Belt One Road Project in China – The Takeaway
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