The Pros and Cons of Silk Road Economic Belt
The Silk Road Economic Belt is becoming increasingly relevant with the escalating threat from terrorism, human trafficking and illegal narcotics along its path. Indeed, the economies of the more than fifteen countries along this trade route are almost wholly reliant upon remittances coming from China and other parts of Asia. In addition, the Belt itself is a zone of cooperation with Tajikistan, Pakistan, Afghanistan and Iran. Some of the other countries that are enjoying the benefits of connectivity through this trade route include India, Kazakhstan and Georgia.
However, while some of these nations enjoy the protection of the Belt, others are apprehensive about its vulnerability to illegal smuggling and trafficking. They fear that it could be used by those looking to bring in illegal drugs and weapons. In fact, reports from the western media, intergovernmental agencies and security organizations indicate that many of these shipments did in fact come from China. For the governments of these nations, this raises questions as to why they are allowing trade routes that give way to illicit activities Silk Road economic belt.
However, the economies of the countries along the road are not the only ones that can benefit. The countries along it will also gain access to new markets for their products. This in turn will generate job growth and increase tax revenues. This makes the Silk Road an important economic development mechanism in the region. It also provides a venue for political cooperation, investment and technology sharing among the countries of Central Asia. The Belt may not be all about economic benefits to these countries but also about social benefits such as the opening up of borders and the boost in diplomacy.
The road is already a major facilitator of trade between Asia and Europe. It connects China to the rest of the world through the Gulf of Mexico and the Mediterranean Sea. At present most of the Middle East’s traffic passes through the route. Besides, India, a major regional player, makes regular visits to Pakistan and China through the Belt. For this reason, the economic potential of this route has become immensely relevant.
The road also plays an important role in boosting bilateral trade. Since the connectivity is based on political understanding and mutual trust, it facilitates the movement of goods and services and investment as well. Thus, developing countries along the route can enjoy better relations with each other and develop stronger cooperation at the international level.
Moreover, it boosts the regional economic growth rates. Multinational corporations are investing billions of dollars into the Belt. This will spur employment opportunities for millions of people in the Central Asia and Middle East. This is expected to bring more tourists to the region as well, leading to even more investment and trade. Not to mention, the Belt is a huge consumer market.
The connectivity can be used to develop more roads, energy pipelines, ports and railways. This can lead to the lifting of developmental barriers, socio-economic improvements and development projects. This will also help spur the development of the cities along the route. As a whole, it will be a major development. Development is indeed a precious commodity.
The countries that are part of this connectivity have a lot at stake. They have the opportunity to leverage their wealth and become more self-sufficient. At the same time, they can take advantage of the development being experienced by other nations along the Belt. Ultimately, they will be benefitting from this venture.
But, this is not something that can be taken for granted. There are plenty of challenges on the way. For one, it will be difficult for any new country to break into the region. There has been a constant struggle between smaller nations and larger nations for trade. Economically and culturally, there are many differences between these nations.
That is why it will be difficult for a country to make inroads. Additionally, there are some groups that have tried to challenge the established order of the established nation. Take for example, Trans Siberian pipeline project. This was once going to run through China, but the Chinese government blocked the project citing environmental concerns. Well, it looks like China still has an eye on the region.
These are some of the factors that will determine whether or not Silk Road Economic Belt will be able to realize its full potential. So, one should stay tuned. One cannot wait to see how these nations along the Belt react to these challenges.