[G20 Big Picture] China is building a new Silk Road, which explains a lot of geopolitics


Beijing will spend $40 billion to revive the historic Silk Road and connect China with Central Asia, the Middle East and Europe

Chinese President Xi Jinping said the ambitious project is designed to “break the connectivity bottleneck” in Asia. In a grand reference to History, his strategy is to rebuild a “new inland and maritime silk road” to link China and the Mediterranean:
-to boost inland domestic growth
-to reduce dependence on freight lines dominated by European shippers and exposure to sea lanes patrolled by the US navy
-to counter Russia’s attempt to rebuild the sphere it had in the Soviet era.

To do so China is creating a Silk Road Investment Bank and Fund, to build this infrastructure.

eurasiaLooking at the map of Eurasia also puts the current geostrategic tensions into perspective:
a – why Russian president Putin is so focused on Ukraine and Central Asia to control the northern route
b – why the civil war in Syria sees both sides supported by foreign powers: Russia-Iran supporting Assad, while Qatar, the EU and the US initially supported the rebels (with the backfire that some have now turned into ISIS in a serendipitous reminder of what happened in Afghanistan in the 1980-90s when the Mujahedeen fighting USSR eventually became Al Qaeda)
c – why the Afghanistan-Iran region is so strategic to access India and South East Asia

Another fascinating insight comes from the evolution of the world GDP in the past 2000 years (d). In the 1800s the Chinese empire lost its dominance when Europe colonised the world. So in fact, China is on the path to regain a share of global GDP which is matching its landmass and demography.

Xavier Rizos – 15 November 2014 – Sydney


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