The Impact of China’s One Belt, One Road (New Silk Road) – Economic, Political and Social Impact

We all have heard of the ancient silk road, and how it used to be one of the busiest routes which connect East and West in the past. China used to depend heavily upon it for international trade, and it is trying to revive it again. The initial plan to revive the silk road was unveiled in 2013. In the previous article, we talked about the key details with regards to the One Belt, One Road initiative. This mega project is budgeted at around 900 Billion US Dollars. Furthermore, with more than 65 countries partnering China, the potential impact that could be caused by this project cannot be simply ignored. As such, in this article, Kargo would address the potential economic, political and social impacts.

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Economic Impact

In general, the successful implementation of this project could see a bridging of the infrastructure gap between the various nations that are taking part, according to experts. Furthermore, it is said to assist the growth of developing countries through trading as well as funding by investors. For example, China has partnered with Pakistan at the Gwadar port. China is partnering several nations spanning from East Asia, to Middle East, East coast of Africa all the way to Europe. As such, connecting all the countries far and wide.

Political Impact 

As this project spans across more than 65 countries across the various territories, China should be careful about interfering with local politics and issues. For example, The Gwadar Port in Pakistan has long been a battleground between the Pakistani Government as well as local militants. The construction of the port has already resulted in more 12,000 soldiers being deployed for protection. In addition, several regions are currently embroiled in their own affairs. Therefore, potentially making it more difficult to implement the project successfully. Even if it does go underway, the construction sites would need to be heavily guarded. This also requires lots of manpower.

Social Impact

While the execution of this project would allow developing partner countries to “grow out of poverty” through the improvement of infrastructure as well as the creation of jobs, some critics have also highlighted the possible issues that may arise. Environmental standards, human rights are some of the issues that have been raised, when taking into account about the history of actions undertaken by the various companies in the past. In addition, considering the fact that this is a mega scale project, it will be even harder to make sure that environmental standards are met and human rights laws are being upheld.

As it could be seen from above, the impact of the One Belt, One Road initiative is a concern for many countries not because of the great benefits but because of the possible negative impacts.

In our next article, we would talk about Indonesia’s involvement in this project. Till then, leave a comment below, click here