A new study, launched last week in Beijing, from global economic consultants Cebr and sponsored by the CIOB, provides a useful and comprehensive look at the global economic impact of China’s Belt and Road Initiative (BRI). The study, available now in a report entitled From Silk Road to Silicon Road, How the Belt and Road Initiative Will Transform the Global Economy, lays out the likely impact on the global economy, on the economy of each region and on more than 20 leading economies.
Marked internationally last month at an event attended by, among others, Philip Hammond, the BRI is regarded as the centrepiece of China’s international economic policy and is the world’s largest infrastructure project, attempting to rebuild and expand the old Silk Road between Europe and China, reaching potentially 70% of the world’s population.
The UK, referred to as a ‘natural partner’, is forecast to be among the top 10 beneficiaries of the project, sitting seventh in the table of nations that will see the largest economic impact.
Among the headlines in the new report:
- In terms of macroeconomic benefit, the UK is the largest projected beneficiary of the BRI in Europe (more than twice the projected benefit toward Germany, and more than three times that of France).
- Regarding microeconomic benefit, while there are currently no identified projects planned for the UK, there are significant opportunities for British firms to play a part in the BRI and take a share in the economic benefits. For example, there are major advantages for China to partner with regionally based construction professionals such as engineering consultants, project managers, and other professionals who are familiar with European and international design standards. UK firms have the expertise in these areas that China needs and is looking to deploy.
- The BRI is likely to boost world GDP by 2040 by US$7.1 trillion per annum. This raises world GDP by 4.2% of likely GDP in 2040 (or 8.3% of GDP in 2019).
- GDP is likely to be boosted in Western Europe by 5%.
- It is also likely to generate longer-term investment in infrastructure for road, rail and ferry routes along the east cost of the UK. The BRI includes plans to reach Rotterdam, Europe’s largest port, and enhance links between north-western continental Europe, Scandinavia and the UK. An understanding of the plans as they develop will be critical for both government and industry in making the case for UK expertise to be deployed and play a part in the development of the projects being discussed, and the return this could generate.
The CIOB’s President, US-based Chris Soffe FCIOB, has said: “This report is a fascinating look at plans to build what is effectively a road halfway round the world, with impact way beyond its boundaries. Looking at the potential outcomes for the global economy and the opportunities for our industry - and the future of our industry - is something we should all be interested in.”
The CIOB and its members are ideally placed to be at the forefront of showcasing the very best that the UK construction industry has to offer and to positively influence international construction and development. There is also the opportunity to participate in and support delivery of European and national projects.
In order to raise the profile of the opportunities that are likely to be available to the UK-based construction industry and its overseas colleagues and partners, there is a need to engage in this project at an early stage. The CIOB is working with policymakers, parliamentarians and business leaders to raise the profile of the Belt and Road project and support our members in positioning themselves to turn opportunity into reality and, at the same time, show what we can do to bring the highest standards, best practice and latest techniques to the built environment in the UK and beyond.