The Silk Road and Chinese interests in Central Asia and the Caucasus: the case of Georgia

Meine Pieter Van Dijk and Patrick Martens
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Meine Pieter Van Dijk: Senior Project Consultant, Maastricht School of Management
Patrick Martens: Senior Project Consultant / lecturer, Maastricht School of Management

No 2016/12, Working Papers from Maastricht School of Management

Abstract: There was never one Silk Road and there will never be one road in the one belt as suggested by the name, One Belt One Road (OBOR) initiative, chosen by the Chinese government. There will be several railroad connections between Beijing and Europe, different water ways connecting the East and the West and also different highways can be used if one would like to drive from Maastricht to Shanghai. For gas, oil, electricity and possibly in the future water, the options are still open, although a gas pipeline has almost reached Baku and an oil pipeline Atyrau, while a power line is planned to Aktau. In this contribution we focus on railways and roads between East and West and in specific what this means for one country, Georgia. We use this case study to show how large economic and political interests interfere in China's attempt to boast its economy by investing in infrastructure and improved linkages with Europe and the Middle East. It has been noted that this is an example of a Game changer. Instead of trying to compete with the US Navy in the East China Sea China opts to go West. Instead of building up the Chinese navy to be capable of surveillance in the East China Sea, the straits of Malacca and around Somalia, the East-West corridors will eventually be shorter and cheaper and achieve the same results of assuring China's supplies and selling Chinese products, without a costly trip via the Suez Canal to Europe and the Western Hemisphere. We conclude that China bets on several alternative Silk Roads and can play off countries in that game. At the same time it will be mainly Chinese industries, which would benefit from better trade regimes exporting to Europe or the United States, if they invest in countries along the Silk Road.

Pages: 13 pages
Date: 2016-08
New Economics Papers: this item is included in nep-cwa and nep-tra
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