The New Silk Road

The New Silk Road

From the Han dynasty of China (130 BC), various products were marketed between Asia, Europe and North Africa through a set of routes called The Silk Road. This name was coined by the German geographer Ferdinand Von Richthofen in 1877. Thanks to these connections it was possible to travel and trade goods such as silks, fabrics, carpets, furs, weapons, utensils, precious metals, tea, spices, agricultural products and livestock. , as well as it was inevitable that diseases would spread and there would be exchanges of ideas – and even slaves – between the civilizations of Scythia, ancient Greece, the Byzantine Empire, the Han and Tang dynasties, the Parthian Empire, Rouran, Sogdiana , the Köktürks, Xiongnu, Yuezhi and the Mongol Empire.

This constant dynamic of interaction between the continents came to a halt in the 18th century, when new national borders restricted the movement of merchants along all land routes between Europe and China. Since then, overland trade between East Asia and Europe was almost nil.

Three centuries later and countless advances made, a strengthened China with a desire for expansion is betting with all its might on the establishment of a new and improved Silk Road. This megaproject, an initiative of President Xi Jinping in 2014, already has the approval of more than 70 countries, and seeks to facilitate access to the global market for raw materials, project sales and increase global development. Likewise, it pursues the exchange of technologies, internet, energy and infrastructures. 

To achieve its ambitious goal, the world power is investing hundreds of billions of dollars in bridges, ports, rail lines and highways that stretch between Europe, Asia, Africa and more recently Latin America. This has benefited countries like Greece that after its financial crisis, China was the only one that showed interest to invest geostrategically and bought shares in the port of Piraeus.

China positions itself as a superpower. Being the most populous country in the world and wanting to maintain its level, it requires huge amounts of raw materials and natural resources to increase its progress. In fact, in many cases, it negotiates with developing or less privileged countries and in exchange for its resources, it grants them loans to build infrastructure built by Chinese companies.

In 2014, China, in an agreement with Spain, activated the “Silk Train” that follows the Yiwu-Madrid route, the longest rail route in the world, as part of an economic cooperation agreement to promote bilateral trade. Then in 2020, freight traffic had a growth of 110% due to the transport of medical supplies exported from China to the countries where the train passes (Kazakhstan, Russia, Belarus, Poland, Germany or France). In the particular case of Madrid, a total of 141 trains arrived in 2020, reaching a traffic of 15,750 containers in both directions. Other goods transported were auto parts, mechanical equipment and household appliances.

With regard to Germany, China has become the most important trading partner of the port of Hamburg. On the other hand, in 2014 Duisburg joined the Belt and Road Initiative project and currently between 50 and 60 trains arrive per week with their containers. However, China does not have shares in the ports and has not made money loans to the city either. For its part, Italy joined the New Silk Road in 2019 through investments in the port of Trieste in the north of the country.

No one can ignore that Afghanistan, which shares a small fraction of the border with China, was part of the old Silk Road and in 2016 it joined the New Route. In fact, Taliban leaders had a meeting with Chinese diplomatic representatives to guarantee a good coexistence and commercial relationship. Taliban spokesman Zabiullah Mujahid referred to China saying: “It is our main partner because it is willing to invest. We think a lot about the Silk Road. Afghanistan has rich copper mines that, thanks to the Chinese, can be reactivated and modernized”.

At this point it is vital to remember that China requires copper and cobalt constantly because they are used in new technologies. In order to guarantee its growth, it imports an average of 95,000 tons of cobalt essential to produce the lithium batteries that carry cell phones, laptops and electric cars.

In this sense, the New Silk Road covers the edge of the digital in order to promote and disseminate these technologies. For this, investments are made in fiber optic cables, telecommunications networks, electronic commerce, mobile payment systems, projects related to the space industry, data centers, research and multiple projects related to smart cities.

The so-called Digital Silk Road is framed in the Made in China 2025 Plan with a view to achieving world leadership in technology. This program focuses on innovation and training to prioritize quality over quantity and cost. The financing modalities of these projects follow the same model of the New Silk Road with loans granted by the China Development Bank, the Export-Import Bank of China and the state-owned commercial banks.

In this order, with the activation of the New Silk Road, IC Corporation was able to promote international trade between Asia and Europe through new lines of business and product exchange. Since its inception, this Chinese project was considered by the Corporation as a great opportunity to increase the exchange of goods by land through the railway that connects Madrid and Yhwu.

In order to remain at the technological and commercial forefront, IC Corporation maintains its offices in China operating and its engineers in training given by important manufacturers. In 2016, it was precisely in the Asian country where the self-sustaining concept of practical construction of IC4S-X solutions applied in schools, hospitals and communities lacking basic services was designed. The Corporation provides these solutions in its continuous struggle to reduce environmental impact. IC4S-X consists of 5 blocks: energy, telecommunications, water, waste, treatment, infrastructure and operational supplies. In fact, a large part of the products used in IC4S come from China.  

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