The Belt and Road – reaching far and wide
By Sir Nigel Knowles and Frank-Jürgen Richter
Once there was the Silk Road that developed joint trade – could there be a new Road?
When China and the EU reached out to each other after the 1970s it was thought that strong economic benefits might accrue to both sides. China‘s grand reopening began in 1978, and the EU was strongly redeveloping and looking for new markets.
The World Bank and the Asian Development Bank (ADB) discussed the roll-out of roads and railways from the Pacific coast to reach towards Europe. And the EU attempted to link to Asia from the Atlantic coast by extending its existing Trans-European Transport Network via routes in Central Asia and onwards to China. Its programme, like that of the ADB, was to promote regional economic development and be a catalyst to attract international institutional and private investors.
President Xi Jinping’s official announcement of his One Belt One Road plan in November 2013 to initiate a far-reaching and coherent set of routes overland as well as by sea to link China to nations in Asia, Africa, and the Middle East to Europe came as a surprise. The aim was to connect 65 countries, with a combined population of 4.5 billion, to boost long term growth.
President Xi showcased his Belt and Road (B&R) Initiative to the world in a two-day forum in Beijing in May 2017. He noted that the first freight train directly from China to the UK arrived in London on January 3 2017 taking only 18 days – much faster than shipping and cheaper than air freight. It was the President’s over-arching plan that ignited the initial, but smouldering, efforts of the ADB and the EU.
The fast implementation by China of its modern transport infrastructure cannot rely on the same technical and political backgrounds across the rest of Asia. A degree of standardisation of projects is needed to ensure inter-operability with rules published for the financial, physical and governance specification of new projects.
Within Europe there are observable management and political styles, with the UK being seen as pragmatic. If its finance and project skills were engaged across the B&R, all would find that standardisation would develop faster economic and social gains for the regions.
One example might be the adoption of the Bombardier TRAXX railway engine (Transnational Railway Applications with Extreme Flexibility). This engine is designed to adapt to different track gauges and multiple rail electrification schemes, and if used from the Atlantic to the Pacific coast would simplify the work-load of railway engineers and maintenance crews. This idea is simply pragmatic – of extending an existing product into wider markets.
There are goals along the B&R that are readily achievable for firms in the UK. Better and faster payback will be achieved by investing in project management and teaching good innovation management.
In other words – apply the undisputed global finance expertise available in the City of London to harness the full norms of ethical governance, anti-corruption practices and sustainability while rapidly developing the infrastructures needed in the hubs.
Investors could quickly interleave training schemes to support new product development, minimising the personnel required for training (by using as much IT as possible) to train local entrepreneurs to innovate products enhanced by AI and robotisation.
In other words, raise local skills in the hubs of the B&R quickly in the supportive environments made possible by really good project management based on the global expertise already available at the ‘ends of the line’ in the UK, EU as well as China.
The world too often has seen good ideas nullified by poor development. The B&R will not blossom if it is not supported positively, notwithstanding President Xi’s continued belief.
Given the uncertainty created presently by America’s unwillingness to define any policy, the global economic lead must be taken by the two powerhouses – Asia and Europe: in particular, China with its financial strength and its technical positioning, and the City of London with its pragmatic global expertise in financial and project management.
The time is ripe to pave the way for the success of the B&R.
Sir Nigel Knowles is Chairman of the Sheffield City Region. Frank-Jürgen Richter is Founder and Chairman of Horasis, a global visions community. Horasis and the Sheffield City Region are hosting the Horasis China Meeting in Sheffeld over 5-6 November.