Turns on the «Silk road»

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Turns on the «Silk road» 27.07.2017 11:54

May 14-15 Forum "One Belt One Road" was held in Beijing, which was attended by the heads of Russia, Argentina, Sri Lanka, Belarus, Chile, Czech Republic, Indonesia, Kazakhstan, Kenya, Laos, the Philippines, Switzerland, Turkey, Uzbekistan, Vietnam, Cambodia, Ethiopia, Fiji, Greece, Hungary, Italy, Malaysia, Mongolia, Myanmar, Pakistan, Poland, Serbia and Spain (1). The leaders of these countries came to Beijing with concrete proposals. And it is between these countries will be allocated regular Chinese investments, which in 2013-2016. Amounted to about $60 billion, and in the near future it is planned to invest another $14.5 billion.

In the countries along the length of the above-mentioned road and the adjacent territories, the Chinese build a railway, highways, ports, oil pipelines, gas pipelines, plants, etc. (the map below 1). Such activity is caused by the following circumstances:

1. China is trying to become the new economic pole to manage to create its own team, which will allow Beijing not to be subject to economic blockade in case of possible confrontation with the West.

2. In recent years, there have been signs of a slowdown in the Chinese economy. Only in 2016, China's foreign trade declined by 0.9%. In other words it decreased demand for Chinese products. Within the framework of the "One Belt, One Way", China lends or makes investments in third countries to implement their own economic programs. These countries purchase Chinese equipment and technologies for these loans, or in case of joint programs, China builds ports, railways, etc. on its own resources. In the future, it will also transport Chinese products with a privileged status on these communications.

3. By providing loans and making large-scale investments in developing or challenged countries, China also provides some political influence for itself, becoming a reliable partner and a major investor. And this may also suggest the appearance in the future of Chinese warships in the ports built by China in these countries.


 Chinese vision of own initiative




Features of the China Initiative

1. Investments can be obtained only if the given country presents Beijing a well-designed business program. The requesting party must prove to the Chinese that in case of a result that will be obtained due to the amounts provided or Chinese technology or technology, China will make a profit.

2. Countries are divided into conditional groups. Each country should also examine from which programs, provided for a particular group in accordance with its economic capacities and capabilities, be able to receive a grant.

3. The maps already drawn for the "Economic belt of the Silk Road" and the "Sea Silk Road" do not mean anything. The initiative can involve all countries that are in a position to present good business programs.

4. A special fund for low-income countries is also envisaged. China is ready to provide "free" assistance to those countries that are not in a position to independently submit serious programs. China can provide these countries with discontinued equipment that is not in demand in the domestic and foreign markets - tractors, buses, washing machines, etc. This step China intends to "write off" obsolete products with the hope of supplying their spare parts in the future. This could become one of the levers of soft Chinese politics, through which Beijing will win dividends in these countries.

Thus, China is trying to create a new economic network where it will sell its products, through investment and credit provision, create an area of influence for the realization of its own political and economic aspirations. Those who have come to this territory of the country by their own will or dictated by the West cannot refuse to cooperate with China.

And what will small, medium and large countries benefit if they join the initiative of China? Many countries, particularly in Eastern Europe, Asia and Africa, are still not fully recovered, or are in an economic crisis. Participating in the program and receiving investments, these countries will be able to restore their economies and strengthen their security and statehood. They will connect a lot of economic links with the second economy of the world, will receive the modern technologies that they have created. Countries that successfully implement the envisaged programs will receive significant economic benefits. However, the initiative "One belt, one way" will definitely increase the influence of China in these countries, but they will have the opportunity to bring their voice to Beijing. This is in case of luck.

And what will the participants in the "One belt, one way" initiative lose? The losers who will squander the money received will be forced to provide certain services to China, for example, they will have to vote in international structures at his direction, or they will give him military bases, mineral deposits of strategic importance, etc.

An example of the transformation from constantly asking for help in making concrete and effective proposals in the international arena of the country was shown by Greece. At the invitation of the Chinese leadership, the Prime Minister of Greece arrived in Beijing to participate in the forum "One Belt, One Way". China is rebuilding one of the Greek ports in the Mediterranean Sea, so that in the near future Greece will become one of the sea bridges linking China to Europe. Not the Chinese were interested in the unprofitable Greek port, but the Greeks presented the Chinese with a compelling business program and received the money. After the restructuring, the port will bring profit to both the Greeks and the Chinese.

And what can Armenia do?

1. To study the initiative "One belt, one way" seriously;

2. To create a professional team that will monitor the sphere and report the results to the government;

3. Try to get China's investment for agriculture, with the proviso that instead of the received technology and innovative technologies, China will be supplied with fruits and vegetables. It is required that they do not contain chemical additives and be grown on "clean land", far from chemical plants and waste.

Such products can be successful in China, where there is a high level of contamination of land and air. By the same logic can also be an investment for the production of meat products (in China is particularly high demand for beef). In this case, it should also be noted that meat products will be without chemical additives;

4. To organize a special program, during which Chinese specialists will be invited to the RA. Show them that the RA labor is cheaper than in China and some South Asian countries. In the case of production in Armenia they will be able to sell the products in the Eurasian Economic Union.

5. To suggest that China restore and modernize chemical plants and institutions that remained from the Soviet Union, since chemical products are still in demand in many post-Soviet countries and can be sold in the Eurasian Economic Union. Armenia will receive jobs, China - profit.

6. To arrange direct flights Yerevan-Beijing-Yerevan, Yerevan-Shanghai-Yerevan, Yerevan-Guangzhou-Yerevan. This step will facilitate the entry of Armenian entrepreneurs into China, the number of Chinese tourists will increase. By the way, since in China there is a great interest in Christianity, in case of correct advertising, I think many will be interested in the trip to Armenia, the first in the world to accept Christianity as a state religion It is possible that ecotourism and the idea of breathing in "fresh air" can also be of interest. It will be possible, if the time of flights and the prices for air tickets are reduced, Armenia will be advertised at the proper level in China.

7. So far, even when obtaining a visa to China, RA citizens are required to pay money, deal with bureaucratic red tape to purchase a separate visa to Hong Kong. While citizens of other countries, having a Chinese visa, get the opportunity to travel throughout China, including in Hong Kong.

And citizens of a number of countries on the "special list" (Afghanistan, Armenia, Somalia), when visiting Hong Kong, face red tape. It is necessary to withdraw the RA from this list and return it to the list of "normal countries" so that RA citizens can easily enter Hong Kong when they receive a visa to China, which is considered to be an international center of financial and innovative technologies.


1 http://www.xinhuanet.com/world/brf2017/.

2 The map was downloaded from the site https://www.csis.org/.


Mger Saakyan, Institute of International Relations of Nankin University