China’s Belt And Road Initiative Member Countries: Exports Up 28% In Three Years
Op/Ed By Chris Devonshire-Ellis
- 135 countries surveyed, average exports up 28.8% from 2016 to 2019
- Infrastructure and ports build helping smaller economies export sales worldwide
- Other developments in global trade, reforms and taxes assisting
- US sanctions not helping reign in developing markets who are just looking to sell elsewhere
China’s Belt & Road Initiative was originally launched, albeit known as the ‘One Belt One Road’ back in 2013. Now we are seven years down that path, and able to measure to some degree, the success, failure – and impact of these investments.
One of the criticisms about China’s Belt & Road Initiative is that it has solely been based upon boosting China’s exports, and has not been concerned about assisting BRI member states with their own exports. However, data collated from the World Bank’s TDC360 website shows this is be untrue. In fact, in the recent period 2016 to 2019, Belt & Road member states increased, on average their exports by 28.8%.
The data below explains. Amounts are measured in Billions of US dollars and include the export of both goods and services.
|Belt & Road Countries Export Trade Development|
|Antigua and Barbuda||0.608||0.608||–|
|Bosnia and Herzegovina||6.03||8.05||+33.49|
|Papua New Guinea||no recent data|
|Solomon Islands No recent data|
|South Sudan No data|
|Trinidad and Tobago No data|
|United Arab Emirates||360||389||+8%|
|Vanuatu No data|
|Venezuela No data|
|Yemen No recent data|
The results are pretty conclusive, and do show that overall, the countries that have signed off with China’s Belt & Road Initiative have seen their exports improve. This isn’t just down to the BRI, it is also part to do with an on-going recovery from the Global Financial Crisis that hit in 2007-08. The impact of that resulted in exports dropping around the world with many countries entering into recession and global output dropping by trillions of dollars. Recovery only began to occur in 2016, after global economies had managed to absorb the huge debt that had built up. That timeframe coincides with the first of China’s Belt and Road Infrastructure projects starting to come onstream.
While China’s BRI cannot take full credit for the growth in BRI members exports, it certainly hasn’t harmed them either. Accusations or concerns that countries would see their economies swamped by cheap Chinese imports and destroy their domestic exporters have proven to be unfounded. Exactly the opposite has happened – BRI member states have enjoyed a healthy and growing rates of exports the past three years. Although it will be true that Covid will dampen figures for 2020, the fundamental drivers are in place.
There are some stand outs, such as Russia, whose 45.76% increase in exports has come about as part of an aggressive drive to establish new markets in the wake of US and EU sanctions. But the BRI is also having an impact – Russia’s bilateral trade with China alone is set to double in the next four years to US$200 billion.
Uzbekistan, with export growth of 48.5% since 2016 is reaping the benefits of a change of regime and a program of reform and develop, and has opened up its market to foreign investors as well as making strategic tax cuts designed to boost the economy.
Vietnam’s 45.83% export growth is due partially to American and other manufacturers relocating there from China as a result of the US-China trade war, while in Africa, Libya’s incredible 393% increase in exports comes after a civil war destroyed its economy. However, all – and many of the other nations identified – have seen their exports to China increase.
Each of the countries involved have a different story to tell, with research available to answer the whys and wherefores, the good bets with the bad, the primary investment destinations and those that may require additional reforms.
Adjusting the picture regionally also presents an interesting set of figures:
|Belt & Road Members In:||Export Performance Average|
|Eurasian Economic Union||+43.38%|
|Countries Bordering China||+33.12%|
These show that global supply chains are shifting. New standards of road, rail, shipping and ports, and the emergence in cost effective labor in regions such as Africa – where countries such as West Africa’s Benin, the Gambia, Ghana, Guinea and Mauritania, lesser known East African nations such as Burundi, Comoros, Djibouti are all seeing improved infrastructure assist with improved exports. The African Continental Free Trade Agreement (AfCFTA) is also starting to have an effect on landlocked African nations such as Chad, Gabon, Mali, Rwanda and Uganda, and are all posting significant export increases. This will, over the course of the next decade, mean export manufacturers servicing markets in North America, Europe and Asia will be looking to relocate to these countries. This shift is already starting to happen.
We will be examining this data in more detail in later articles. To subscribe to Silk Road Briefing and make sure you receive these updates, please click here.
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Silk Road Briefing is written by Dezan Shira & Associates. The firm has 28 offices throughout Asia, and assists foreign investors into the region. For strategic advisory and business intelligence issues please contact the firm at email@example.com or visit www.dezshira.com