China’s H1 2023 Trade with BRI Countries Up 9.8%, Chinese BRI Investment Continues

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Implications for the EU and US, as Chinese trade preferences currently lie elsewhere

By Chris Devonshire-Ellis

China’s trade with countries part of its Belt & Road Initiative countries has increased to ¥6.89 trillion (US$964 billion) in the first half of 2023, an increase of 9.8% year-on-year, according to MOFCOM. BRI countries trade with China now accounts for 34.3% of China’s total import and export value, an increase of 2.4 percentage points year-on-year. MOFCOM have also released data concerning China’s investments along the BRI in H1 2023.


Lu Daliang, a spokesperson of the Chinese General Administration of Customs and Director of the Statistics and Analysis Department, was interviewed on the subject by Chinese media last week and discussed the data as follows:

“In the second half of this year, the third Belt and Road International Cooperation Summit Forum will be held. In the ten years since the “Belt and Road” initiative was proposed, the import and export between China and countries along the “Belt and Road” has increased from ¥6.46 trillion in 2013 to ¥13.76 trillion in 2022, a cumulative increase of 1.1 times, and this year has also continued to maintain rapid growth. In the first half of this year, the import and export between China and countries along the Belt and Road was ¥6.89 trillion, a year-on-year increase of 9.8%, which was 7.7 percentage points higher than the overall growth rate of foreign trade. The main features are:

Closer industrial cooperation. In the first half of the year, China’s exports of intermediate products such as auto parts, lithium batteries, and automatic data processing equipment to countries along the route increased by 39.3%, 34.3% and 28.9% respectively. During the same period, imports of energy products and agricultural products from countries along the route also increased by 5.7% and 17.9% respectively.

The effect of interconnectivity is prominent. In recent years, the China-Europe Railway Express, the New Western Land-Sea Corridor, and the China-Laos Railway have continued to make efforts, and the level of connectivity between China and countries along the route has been greatly improved. In the first half of the year, China’s imports and exports to countries along the route increased by 23.8% by rail, 14 percentage points higher than the overall growth rate of countries along the route, and maintained double-digit growth for 12 consecutive months. Import and export to countries along the route by road transport increased by 63.6%, 53.8 percentage points higher than the overall growth rate to countries along the route, and the growth rate exceeded 30% for five consecutive months.

The performance of the central and western regions has been impressive. In the first half of 2023, the central and western regions’ imports and exports to countries along the “Belt and Road” increased by 23.2%, accounting for 21.2% of the total import and export value between China and countries along the route during the same period, an increase of 2.3 percentage points year-on-year. Among them, the growth rate of imports and exports from the three autonomous regions of Guangxi, Xinjiang, and Inner Mongolia to countries along the route all exceeded 50%.

For a long time, China Customs has thoroughly studied and implemented the spirit of General Secretary Xi Jinping’s important speech, taken high-quality service and joint construction of the Belt and Road as a key task, and paid close attention to its implementation. Since the beginning of this year, work has been mainly carried out in the following aspects:

The first is actively promoting the import of high-quality agricultural and food products. In the first half of the year, 44 customs inspection and quarantine cooperation documents were signed with countries jointly building the Belt and Road, including 30 agricultural and food product access agreements.

The second is continuing to carry out trade facilitation cooperation. We have signed a memorandum of understanding on international trade “single window” cooperation with the Iranian Customs Administration and signed AEO mutual recognition arrangements with the Philippines, Costa Rica, and Uzbekistan.

The third is vigorously improving the level of port software and hardware, optimizing the Belt and Road customs information sharing and exchange platform, and ensuring the stable operation of the China-Kazakhstan Customs Rail Link project.

Fourth is actively participating in the preparations for the third Belt and Road International Cooperation Summit Forum and the Special Forum on Unimpeded Trade.

In the next step, China Customs will continue to upgrade and develop multilateral and bilateral cooperation mechanisms with countries involved in the joint construction of the Belt and Road. There will be a strong emphasis on promoting cooperation in trade security, facilitation, inspection, and quarantine, among other areas. These efforts aim to make new contributions to the customs’ role in extending and broadening the path that the Belt and Road brings.”

The Third International Belt & Road Forum

The dates for the coming International Belt & Road Forum have not yet been set but this is believed to be scheduled for September or possibly later. September would also fit in with the tenth anniversary of the BRI, and is the month Chinese President Xi Jinping formally announced the project during a speech concerning China’s Central Asia strategy at Nazarbayev University in Astana, Kazakhstan in 2013.

China’s H1 2023 BRI Investment Data

In terms of Chinese investment along the BRI during the H1 this year, MOFCOM stated that from January to June 2023, Chinese enterprises’ non-financial direct investment in countries along the Belt and Road reached ¥80.17 billion, (US$11.22 billion) marking a year-on-year increase of 23.3%. This accounted for 18.6% of the total amount during the same period, showing a 0.1% point rise compared to the previous year. The major recipients of these investments were Singapore, Indonesia, Malaysia, the United Arab Emirates, Vietnam, Thailand, Laos, Kazakhstan, Cambodia, and Russia in addition to smaller investments elsewhere.

In terms of foreign contracted projects, Chinese enterprises signed new contracts worth ¥330.1 billion (US$47.64 billion) with countries along the “Belt and Road,” reflecting a year-on-year decrease of 2.5%.  These contracts accounted for 50.3% of China’s total foreign contracted projects during this same period. Moreover, these enterprises completed a business turnover of ¥277.72 billion, (US$40.08 billion) showing a year-on-year increase of 11.5% representing 56.7% of the total turnover during the same period.


China’s rise in BRI trade and investment this half year is in contrast with China’s trade with the EU, which has contracted by 4.9% and with the United States by 14.5%. With Italy’s Prime Minister Georgia Meloni due closer to the year-end to discuss Italy’s membership of the BRI with President Xi, pressure from Brussels to exit the deal collides with Italian businesses pressure to engage more. While the Italy-BRI MoU has not especially delivered, part of the issue remains with Italy’s regionally divisive politics – attention and investment has been made in the wrong areas and in ports not likely to deliver, while more suitable channels have been under-represented. Reading between the lines, should Xi instruct more Chinese investment to be made into Italy, a decision to exit the MoU may yet be delayed by Rome.

Elsewhere, the continuing trend of BRI trade growth is maintaining its charge, although critics will point to a slow-down in the growth of Chinese investments. Well, they can’t keep investing in it forever, and the fact remains that after a decade, many BRI projects have now been completed. The obvious trend by Chinese investors has been clear to see: Invest, IPO, Exit and maintain an equity share for future cashflow dividends. This is an issue we discussed in some detail in our Asian Investment Research report, “How China Is Reforming Its SOEs to Become Mixed Hybrid Global Businesses”, which discusses this trend and can be downloaded here.

The statistics also point, if not to a de-coupling between China and the West, but certainly that a re-think in the West’s relationship with China is probably en route. The US and EU are beginning to realise that constantly decreasing China trade figures may not be in their best interests. A pointer that this may be now happening is that the French Finance Minister, Bruno LeClaire, has stated that in fact, the European auto industry can withstand the import of cheap Chinese EVs, just three years after the EU ripped up the EU-China Free Trade Agreement.

Clearly, while Western ambivalence and criticism towards the BRI will remain, conducting trade and investment with China per se will be a rather different proposition.

Chris Devonshire-Ellis is the Chairman of Dezan Shira & Associates. He may be reached at

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