The Old Silk Road and the New Economic Silk Belt
This is China's attempt to step up its role in global affairs, and to export China's production capacity in industries such as construction materials, transportation equipment, roads and rails.
Latest News
Port of Baltimore May Not Reopen Until Summer Sales & Operations Planning (S&OP) Mastery A New Priority Greets Procurement Professionals in 2024 Cargo Shipping Remains on Hold in Baltimore Following Bridge Collapse Maximizing the Bottom Line: The Power of Procurement More NewsLatest Resource
Sales & Operations Planning (S&OP) Mastery In this Special Digital Edition of Supply Chain Management Review, you will find insights on the importance of sales and operations planning (S&OP) to an organization’s bottom line.All Resources
The first blog I wrote for Supply Chain Management Review in April, 2012 was about the first global supply chain, otherwise known as the Silk Road. Starting around 200 BC and extending 4,000 miles, the Silk Road got its name from the lucrative Chinese silk trade and tea trade in exchange for spices, nuts and jewels from Europe and the Middle East.
In addition, various science and technology innovations were traded along with religious ideas and the bubonic plague. The Silk Road was a significant factor in the development of modern civilizations.
A new Silk Road is now being built in China.
The One Belt and One Road Initiative is a development strategy and framework that focuses on connecting countries primarily in Eurasia. There are two main components: the land-based “Silk Road Economic Belt” (SREB) and oceangoing “Maritime Silk Road” (MSR).
The details released so far by China’s official media outlets show the “Belt” as a planned network of overland road and rail routes, oil and natural gas pipelines, and other infrastructure projects that will stretch from Xi’an in central China, through Central Asia, and ultimately reach as far as Moscow, Rotterdam, and Venice. The Maritime Silk Road is a complementary initiative aimed at investing and fostering collaboration in Southeast Asia, Oceania, and North Africa, through several contiguous bodies of water – the South China Sea, the South Pacific, and the Indian Ocean.
The construction of the belt will also relieve China’s industrial overcapacity and ease the entry of Chinese goods into regional markets. This will help China with its projected industrial growth rates and improve unemployment.
This is China’s attempt to step up its role in global affairs, and to export China’s production capacity in industries such as construction materials, transportation equipment, roads and rails. Chinese President Xi Jinping, has made the program a centerpiece of both his foreign policy and domestic economic strategy. The initiatives are expected to be highlighted in China’s 13th Five-Year Plan, which will go through 2020 and guide national investment strategy throughout that period.
So what does this mean for Supply Chain professionals?
There is no doubt that improving transportation infrastructure helps to facilitate trade and in turn, that will help companies to improve getting their products to market. As we see more and more cooperative and physical trade initiatives such as ASEAN, NAFTA, the EC and now the Silk Belt, we can expect to see global trade continue to flourish. There will be more need for global manufacturing strategies, international transportation companies and professionals as well as trade compliance management.
About the Author
Rosemary Coates Ms. Coates is the Executive Director of the Reshoring Institute and the President of Blue Silk Consulting, a Global Supply Chain consulting firm. She is a best-selling author of five supply chain management books including: 42 Rules for Sourcing and Manufacturing in China and Legal Blacksmith - How to Avoid and Defend Supply Chain Disputes. Ms. Coates lives in Silicon Valley and has worked with over 80 clients worldwide. She is also an Expert Witness for legal cases involving global supply chain matters. She is passionate about Reshoring.Subscribe to Supply Chain Management Review Magazine!
Subscribe today. Don't Miss Out!Get in-depth coverage from industry experts with proven techniques for cutting supply chain costs and case studies in supply chain best practices.
Start Your Subscription Today!
It’s high time to go beyond visibility Driving supply chain flexibility in an uncertain and volatile world View More From this Issue