Guide
The New Eurasian Land Bridge Economic Corridor is the only corridor under the framework of the "six major economic corridors" of the Belt and Road Initiative that directly connects China and developed countries in Europe. The corridor is currently facing challenges including geopolitical games, inadequate infrastructure connectivity, debt and economic transition difficulties along the route. In order to better promote the construction of the corridor, it is necessary to continue to improve the Eurasian connectivity network, expand the scale of trade and investment, carry out targeted cooperation in industry and science and technology, improve the financial cooperation mechanism, expand the coverage of RMB settlement, and strengthen cooperation in global governance coordination.
Ning Liufu is an assistant researcher at the Department of American and European Studies at the China Center for International Economic Exchanges
Among the "six major economic corridors" covered by the Belt and Road Initiative, the New Eurasian Land Bridge Economic Corridor is the only corridor that directly connects China and developed countries in Europe, creating a new channel for Asia-Europe inter-trade and logistics, and greatly enhancing the resilience of global supply chains.
In recent years, under the overall framework of the Belt and Road Initiative, the political mutual trust between China and the Eurasian Economic Union countries has been continuously strengthened, and the construction of the China-Kyrgyzstan-Uzbekistan railway, which has been delayed for many years, has begun to be put on the agenda. The scale of trade between China and countries along the corridor continues to expand, and China and Russia have achieved the target of 200 billion US dollars in trade volume by 2024 ahead of schedule. Between 2014 and 2022, trade in goods between China and CEE countries increased by 120.5%, 3.2 times the growth rate of trade between China and the EU in the same period. The proportion of goods transported by China-Europe freight trains in total China-EU trade increased from 1.5% in 2016 to 8% in 2022. Up to now, the China-Europe Express has reached 217 cities in 25 European countries. The investment and industrial cooperation between China and the countries along the corridor has been deepened, the Hungarian-Serbian railway has become a landmark project of the Belt and Road Initiative, and the China-Kazakhstan and China-Belarus production capacity cooperation has become a successful example of international production capacity cooperation.
Image source: China Daily
However, at the same time, there are also many problems and challenges in the construction of the New Eurasian Land Bridge Economic Corridor: First, it faces headwinds in policy communication and people-to-people bonds. The route along the New Eurasian Land Bridge has always been the focus of geopolitical games, and the Russia-Ukraine conflict has had a direct impact on the construction of the corridor. The three Baltic countries have withdrawn from the China-CEE cooperation mechanism one after another. Second, there is still a lot of room for improvement in the ability of facilities to connect. The overseas section of the China-Europe Railway Express is relatively single, and problems in individual countries and individual sections are likely to affect the operational efficiency of the whole line. Third, the unimpeded flow of trade is facing increasing obstructions caused by political factors. The economic structure of the countries along the corridor is deformed and single. With the change of the EU's China policy, China's trade and investment with CEE countries and the EU are increasingly affected by security considerations and value standards. Fourth, the depth and breadth of financial integration need to be further expanded. The corridor construction project has only one financing channel and relies too much on bank credit provided by the Chinese side. Moreover, low- and middle-income countries along the Belt and Road have a higher debt risk.
Under the new situation, to promote the high-quality development of the New Eurasian Land Bridge Economic Corridor, it is necessary to deepen policy communication and people-to-people exchanges, and enhance strategic mutual trust between China and countries along the route. It is necessary to strengthen policy communication with the EU on China-CEE cooperation, further enhance the transparency and standardization of China-CEE cooperation, pay more attention to the effectiveness and content of cooperation, and adhere to international rules and EU laws in the process of cooperation. Explore the docking of the "Belt and Road" initiative with the "Global Gateway" plan proposed by the European Union, and attract "old European" countries to jointly carry out trilateral cooperation in Central and Eastern Europe. At the same time, we will seize the opportunity of Russia's "look east" and continue to expand the breadth and depth of China-Russia economic and trade cooperation. When conditions are ripe, an official cooperation mechanism covering all countries along the corridor can be established to coordinate and promote the construction of the corridor as a whole. Strengthen the construction of people-to-people exchange mechanisms among countries along the corridor, and consolidate the institutional foundation for people-to-people exchanges and cooperation. Promote mutual visa exemption between China and countries along the Belt and Road, and expand tourism exchanges. Relying on overseas brand projects such as Luban Workshop, we will strengthen international exchanges and cooperation in vocational education with countries along the corridor, and improve the level of vocational education and the ability to train technical talents in countries along the corridor.
Image source: China Daily
Second, it is necessary to improve the connectivity capacity of facilities and improve the Eurasian interconnection network. Together with relevant countries along the corridor, we will actively promote the upgrading and transformation of "stuck neck" ports and road sections, and strive to improve the distribution capacity of key hubs. Continuously improve the operation quality of China-Europe trains, ensure the safety of train operation, continue to expand the scope of China-Europe trains in the whole timetable, and study the operation of double-decker trains. We will continue to expand new routes for overseas sections, promote the construction of the China-Kyrgyzstan-Uzbekistan Railway as scheduled, and actively participate in the construction of the Trans-Caspian International Transport Corridor. Accelerate the construction of the China-Europe Railway Express information platform and smart ports, and further promote the construction of trade rules and standards. Promote the linkage development of China-Europe freight trains, the new land-sea corridor in the western region, and the Silk Road shipping.
Third, it is necessary to expand the scale of trade and investment, and carry out targeted cooperation in the fields of industry and science and technology. Accelerate the benchmarking of international high-level economic and trade rules, actively respond to the EU's demands for China-EU economic and trade cooperation, and promote the balanced development of bilateral trade. Actively implement the plan to expand imports from Central and Eastern European countries, especially the import of advantageous and special agricultural products. We will further implement the project for young scientists from countries along the New Eurasian Land Bridge Economic Corridor to work in China. We will create conditions for launching a joint feasibility study on the free trade agreement between China and the Eurasian Economic Union as soon as possible, deepen dialogue in the field of trade remedies, and reduce trade barriers between China and the Eurasian Economic Union.
Fourth, it is necessary to improve the financial cooperation mechanism and expand the coverage of RMB settlement. Strengthen cooperation with third countries and various international multilateral financial institutions, widely attract private capital to participate in the construction of the corridor, and build a long-term and stable diversified financing support system. Increase the proportion of local currency-denominated settlements in trade and investment with countries along the corridor, and expand the scope of application of the RMB cross-border payment system in countries along the corridor. We will encourage Chinese financial institutions to open more outlets in countries along the Belt and Road, expand RMB investment and financing channels in countries along the Belt and Road, and strengthen cooperation with countries along the Belt and Road in digital currency and green finance. Establish a real-time monitoring and dynamic early warning system for debt risks of countries along the corridor, and seek long-term and targeted solutions to debt problems.
Image source: China Daily
Editor-in-charge | Song Ping, Xin Xin
Edit | Zhang Zhao
Intern Zhang Yanyu also contributed
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