At the end of last year the first train was sent from China as part of the international Silk Road transport corridor. The route was built by-passing Russia. However, according to participants in the market, transport companies are interested not in politics, but the cost of services. Experts positively view the appearance of new routes, as competition always positively influences the development of a sphere. At the same time, the head of the research group studying the world economy at the Center for Macroeconomic Analysis and Short-Term Forecasting, Alexander Apokin, thinks that at the moment, there are huge structural problems with overland supplies from China to Europe: “In order to create a route to bypass Russia, they need incomparable expenses at the level of political guarantees. The alternative to the land route is a sea route, and China acts very actively here. The problem is external infrastructure – security guarantees, control and comfort of supplies. The existing path, both through Russia and Rotterdam, in terms of competitiveness is now more economically profitable for China, but significantly less favorable strategically. That’s how the story about the Economic Belt of the Great Silk Road emerged.”
The second problem of China is related to the possibilities of using currency reserves abroad: “We remember the story about sovereign investment funds seven years ago. We know how China is now implementing programs with the countries of Central Asia, Pakistan, quite big agreements were signed with Afghanistan and Turkey. But China prefers to interact with the EAEU through Kazakhstan. This is the biggest risk for the Eurasian Economic Union. Kazakhstan is the largest country in the world without access to sea communications, a landlocked state, and while they are very interested in the project of the Eurasian Union, they would be interested in becoming an exclusive transit hub even more. And their accelerated modernization of the investment climate is largely adjusted to this.”
China is trying to build an alternative corridor to have a more flexible opportunity to transport cargo to Europe. However, some experts believe that transportation of cargo from China to Europe through the “southern” route, by-passing Russia, is economically unbeneficial. The route goes through two seas and five states.
Alexander Apokin believes there is no real existing southern route: “All the documents on it are signed, deliveries can begin tomorrow, but it is just not profitable. And while it does not exist, a fundamental point is to provide competing routes that pass through Russia. This is an important strategic goal. And China is willing to participate in it. Even if it will be something through the expansion of the capacity of the Trans-Siberian Railway, which does not seem particularly likely, or through a more active use of the Baikal-Amur Railway, in which case we should follow the principle of interest, because China is still preparing an alternative route. It is conducting this policy consciously.”
According to the expert, the question is what kinds of investment require diversification and what potential benefits it can provide. “China is currently interested in diversification of the Shanghai-Rotterdam sea route. This route passes through the South China Sea, but in our reality only one country controls the sea routes. It has become less favorable to rely on one geopolitical partner in ensuring the safety of routes in the modern world than was the case 10 years ago,” Apokin believes.
