DVM 2106 Lecture Notes - Lecture 7: Silk Road Economic Belt, One Belt One Road Initiative, Silk Road
21 Jun 2018
School
Course
Professor
LECTURE 7: China and Emerging Economics (Jing Gu)
•One belt one road (OBOR): An initiative by president Xi Jin Ping to promote the economic
integration of the region through investment in infrastructure, cultural exchange and increasing
trade. The two elements of this initiative are land based silk road (SREB) and maritime silk road
(MSR).
•South-south cooperation: A framework of cooperation initiated by BRICS to facilitate the
triangular development cooperation strategies between traditional donor, an emerging donor in
the South, and a beneficiary country in the South. In this framework BRICS regard themselves as
partners than the donors.
•Triangular development cooperation: involves agreements with both developed and
developing countries to acquire and disseminate knowledge applied to social and economic
development. It is a strategy adopted by emerging economies to enrich the development in the
Global South.
Transition in World Economic Order
- Global economic shift (west to east)
- Rise of new growth centers in world economy (Brazil, India and China and the gulf states)
- Rise of BRICs as donors (Brazil, Russia, India, China and South Africa)
- Challenge the dominant aid discourse of OECD-DAC
- Emergency of non-DAC donors (China, Brazil, Korea, India, Gulf States, Venezuela)
- Development assistance by non-DAC countries higher than OECD countries
New form of AID
- Southern development partners
- Building partnership based on solidary and respct
- Southern African Development Agency
- Indian Agency for Partnership in Development
- BRICS: transitional shift in dominant development cooperation
Attractiveness of emerging donors
- Broken promise of more aid by OECD/DAC
- Diversion of aid to security from development
- Economic downturn and financial crisis
- Non-DAC countries providing aid to poor countries
- Traditional donors clinging to conditionality
- Emerging donors based on mutual respect sovereignty and equality
China as Emerging Donor
- Higher growth rate of Africa
- Better terms of trade
- Increased export volumes, and higher public revenues
find more resources at oneclass.com
find more resources at oneclass.com
Chinese Approach in International Development
- Development partnerships for economic cooperation through trade investment… infrastructure
capacity building, project support and provision of technical know-how
- Win-win development relations to Africa and other countries
Critiques:
- Core economic interest in investment
- No interest on human rights abuses, corruption or structural inequalities in its trade and
corporate practices
Foreign aid with Chinese characteristics
- China’s first White Paper on Foreign Aid in 2011 emphasized five principles (in order to respond
to international criticism that it lacked a clear policy statement on international development)
1. Helping recipient countries build up their self-development capacity
2. Imposing no political conditions
3. Adhering to equality, mutual benefit and common development
4. Remaining realistic while striving for the best
5. Keeping pace with the times and paying attention to reform and innovation
Chinese Development Cooperation
- “Going Global” strategy initiated in 2000
- Global expansion of China’s leading firms and state-owned enterprises (SOEs)
State incentives
Preferential trade access
Lowe interest loans
Exim Bank support (the export and import bank of China)
- SOEs involved in labour-intensive manufacturing and infrastructure construction in developing
countries through joint ventures with local private and state-owned enterprises
China in Africa
- Growth in both public and private investment in Africa…. 20019-12 (growth rate of Chinese
investment was 20.5%)
- Matched by increase in trade… in 2012, total volume of China-Africa trade reached USD 198.49 ;
19.3% growth
- Expansion in China’s engagement with Africa is subject to widespread debate!!!
Chinese Waves in Africa
- Africa as “Golden land” for Chinese private enterprises
- Three jump trade pattern of private enterprises….
a) Long distance trade (export from China)
b) Investing in production in Africa
c) Investing in industrial parks in Africa)
- Motivated by high investment climate in Africa
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Lecture 7: china and emerging economics (jing gu: one belt one road (obor): an initiative by president xi jin ping to promote the economic integration of the region through investment in infrastructure, cultural exchange and increasing trade. The two elements of this initiative are land based silk road (sreb) and maritime silk road (msr). South-south cooperation: a framework of cooperation initiated by brics to facilitate the triangular development cooperation strategies between traditional donor, an emerging donor in the south, and a beneficiary country in the south. In this framework brics regard themselves as partners than the donors. Triangular development cooperation: involves agreements with both developed and developing countries to acquire and disseminate knowledge applied to social and economic development. It is a strategy adopted by emerging economies to enrich the development in the. Rise of new growth centers in world economy (brazil, india and china and the gulf states)
