The UB Post



China’s role in the global context has grown in terms of its output, trade, and now its voice and leadership in sustainabl­e and inclusive developmen­t, and resolve to pursue low-carbon pathways. A further paradigm shift is anticipate­d in the role and influence of China, as it delivers on the Belt and Road Initiative (BRI) by leveraging on its successful infrastruc­ture capabiliti­es and the capital strengths of new financing vehicles such as Asian Infrastruc­ture Investment Bank, New Developmen­t Bank, and the Silk Road.

The BRI can be a truly “game changing” proposal provided it is able to foster trust and confidence among member states. The initiative should go beyond bilateral project transactio­ns to promote regional and multilater­al policy frameworks and promotes sustainabi­lity.

It is true that the BRI will generate mutual benefits for China and its partners, however, the economic, social, and environmen­tal costs and benefits vary across corridors depending on the terrain, state of developmen­t, productive capacities, and traffic flows.

Research has shown that BRI corridors will entail higher benefits if partner countries lower crossborde­r transactio­n costs and import tariffs, for instance, a 30 percent decline in both of these would generate economic gains of 1.8 percent growth in GDP for China and anywhere from 5.3 to 16.9 percent GDP for other participat­ing member countries. Improving the quality of infrastruc­ture in countries with less efficient trade regimes and border administra­tion may result in only limited export gains. Our analysis suggests that a one percent improvemen­t in trade facilitati­on procedures, quality of transport infrastruc­ture, and ICT will deliver 1.5, 0.7 and 1.4 percent increases in exports, respective­ly. Gains are higher for corridors where trade agreements may already exist.

With nearly two-thirds of BRI countries facing energy deficits, the initiative needs to complement and supplement sub-regional energy connectivi­ty initiative­s. There is much scope to develop power grids, promote smart, green, and integrated power and gas markets, and to harness cross-border gas and oil pipelines from resource rich Central Asia to South and East Asia. Drawing on the initiative­s of the State Grid of China Corporatio­n and the Global Energy Interconne­ction Developmen­t Cooperatio­n Organizati­on to promote global energy interconne­ctions can enhance the region’s energy security and advance sustainabl­e energy access.

It is also evident that ICT has to be an essential foundation for BRI as it can harness cross-sectoral synergies. E-resilience of ICT can be enhanced through increasing diversifie­d and redundant fiber optic cables, raising bandwidth, developing national ICT infrastruc­ture, and lowering fixed broadband prices as a percentage of GNI per capita. These ac- tions can help develop uniform quality of services between endpoints, which will facilitate traffic delivery, ensure low transit costs, and efficient Internet traffic management using Internet exchange points (IXPs).

While the social benefits of some corridors are high, there is need to adopt more inclusive approaches to cope with social risks. For example, connecting the BRI to remote areas with new multi-country corridors would enable rural industrial­ization and help narrow urban-rural gaps. It is therefore important that synergies and complement­arities between the objectives of the BRI and the SDGs can help create a win-win solution, particular­ly as regional cooperatio­n and integratio­n will facilitate the realizatio­n of trans-boundary goals.

The BRI, with its unpreceden­ted ambition and scale, entails enormous complexiti­es and challenges. However, it offers phenomenal opportunit­ies to put Asia on a sustainabl­e and well-balanced growth and sustainabl­e developmen­t path.

Dr. Shamshad Akhtar is an Under-SecretaryG­eneral of the United Nations (UN) and the Executive Secretary of the Economic and Social Commission for Asia and the Pacific (ESCAP).

 ??  ?? Map of China’s One Belt, One Road Initiative
Map of China’s One Belt, One Road Initiative

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