Silk Road « Dr Alf's Blog

English: Logo of the People’s Daily 中文: 人民日报题字 (Photo credit: Wikipedia)

Here’s an important read in China’s leading paper,People’s Daily Online. It reports that China’s well-funded Belt and Road Initiative has rolled out with thousands of Chinese enterprises going all out in the vast, new market created by participating countries and beyond. It projects that the vast overseas market will become a giant pool of capital, with trillions of dollars of overseas investment and financing in the coming years, experts projected.

Source: China to pour trillions into Belt and Road projects – People’s Daily Online

As I reflected on this article, I remembered that under Trump, America is in retreat economically and geopolitically. It’s a bit sad but surely all’s not lost for the US? Will the next phenomena be China buying up US multinationals on the cheap?

Extent of Silk Route/Silk Road. Red is land route and the blue is the sea/water route. (Photo credit: Wikipedia)

A map indicating trading routes used around the 1st century CE centred on the Silk Road. (Photo credit: Wikipedia)

English: People of the Silk Road, Dunhuang, 9th century. (Photo credit: Wikipedia)



Embed from Getty Images

Here’s a fascinating and comprehensive look at China‘s new Silk Road from SouthFront. The article highlights that China is building roads with speed unprecedented in human history.

Source: ‘One Belt, One Road’ and Hundreds of Highways

Since the financial crash of 2008, major Western governments, including the US, the UK, Germany, France etc. have all been very slow to invest heavily in public infrastructure. Well scoped public infrastructure projects have a multiplier effect on the economy. Sadly, in Europe, especially Southern Europe, German financial orthodoxy has prevailed, with the Fiscal Constraint throttling growth, in an attempt to justify the structural weakness of the Euro. By comparison, China is not constrained, with a powerful central government, ready to invest in infrastructure on an unprecedented scale.

By comparison, the IMF and Western central bankers play a cautious game – they are not yet ready to face up to the strategic challenge from China.

Thoughts?