Xinjiang shows Belt, Road needs specifics

By Wang Cong Source:Global Times Published: 2017/5/7 21:53:39

Concrete agreements will create truly unified market

Northwest China's Xinjiang Uyghur Autonomous Region has been a key outpost for the nation's westward opening-up for centuries. Since the birth of the China-initiated "One Belt, One Road" initiative, the region has become a crucial frontier and an active player in the implementation of the initiative.

That role makes Xinjiang a reliable indicator of how the Belt and Road initiative has been implemented so far, what it will look like once it is fully implemented and what challenges lie ahead. Developments in two of the region's critical land ports - Horgos and Alashankou - suggest that, in spite of better port capacity and local infrastructure, concrete and specific international agreements are needed to form an integrated market along the route.

In Horgos and Alashankou, two cities that are about 300 kilometers apart along the China-Kazakhstan border, the realization of the Belt and Road is palpable on every corner. Once small port cities, both are filled with new buildings and roads and much construction is in progress.

That's the result of vast investment in fixed assets in both cities. In 2016, Horgos invested about 3.2 billion yuan ($463.63 million) in fixed assets, up 26.7 percent from the year before, according to local officials. In the same year, Alashankou invested 2.64 billion yuan, up 26.4 percent, officials there said.

The rapid expansion in fixed-assets investment came after the two cities were designated by the central government as key areas for the implementation of the Belt and Road initiative, giving those cities favorable policy and financial support.

That support has helped both cities achieve great initial results, in terms of expanding port capacity, improving the local infrastructure and attracting companies, officials said. Today, both cities are capable of linking the domestic railway system to that of in Kazakhstan and further on to Central Asia and Europe.

Dozens of China-Europe freight trains have originated in different Chinese cities including Yiwu, East China's Zhejiang Province and Southwest China's Chongqing Municipality to European cities such as Rotterdam in the Netherlands and Madrid in Spain, rolling through the two cities.

Both cities continue to build support facilities for the passage of those trains, including warehouses and export and import processing plants, which have attracted hundreds of Chinese and foreign companies to set up operations.

With that, the foundations for further implementation of the Belt and Road have been firmly established, local officials in both cities said, adding that transportation connectivity has been built.

But now comes the critical part of actually transporting products, which is also the challenging phrase of the implementation.

Recent data in Xinjiang suggest that trade has not improved significantly. In the first quarter of the year, trade in Xinjiang was $4.84 billion, according to the Urumqi Customs. Though it represented a 65.6 percent gain year-on-year, it was far less than the figure of $5.24 billion in the same period of 2013, when the initiative began.

The China-Europe freight trains have been running for a while, but they are not at the frequency local officials envisioned. They said that reflects low domestic and foreign demand for goods. And further market integration along the Belt and Road route is needed to spur demand, they added.

"This is not something (that officials at) our level of government can solve. It needs the central government to negotiate and strike deals with other countries," one official in Alashankou said.

"Once we have deals with all these countries on importing and exporting of more goods, the Belt and Road will really work," the official said.

An official in Horgos echoed that sentiment, while adding that agreements on cross-border trade laws and policies are also needed to ensure smooth cooperation.

The calls from officials who are on the frontline of the implementation of the initiative come at a critical time as leaders of the countries along the route are scheduled to meet in Beijing next week. It is hoped that they can reach some concrete, specific deals on further opening up their markets to one other and each enjoy a bigger piece of a larger pie.

Posted in: ECONOMY

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