China’s Love for Infrastructural Investments

There is a famous Chinese proverb which says, “If you want to get rich, build roads first.” The Chinese formula for economic growth has been largely based on this very proverb. The economic rise of China in the past 30 years has largely been based around building infrastructure that could enable economic activity. Today, when the Chinese economy has firmly established itself as an economic force to be reckoned with, it still largely follows the same principle. This time around, it has decided to take this ideology and apply it at a much larger, almost global scale.

The world has seen a flurry of Chinese foreign investments across a number of countries over the last 10 years. A huge chunk of these investments is in the infrastructural projects across far-flung areas of the world. The latest of its infrastructural investments comes in the form of a grand, highly ambitious project known as the Belt and Road Initiative (BRI). The project aims to knit together much of the world’s economies and markets from Africa, Europe to South East Asia and China with a chain of infrastructural projects that will include roads, bridges, railway lines, ports, etc.

When completed, this project will be able to bring almost 60% of the world markets in close proximity of each other and will unlock tremendous trade and commerce potential of the region. It will place China at the center of all of these connected markets and will also spur economic growth and development across all the regions connected.

There are 29 international organizations and at least 125 countries that are on board with the massive project in some way.

China will provide low-interest loans to a number of countries involved amounting to a total of $1.3 trillion. These loans will be used to build the infrastructure, which is part of the BRI.

The scale of its infrastructural investments is huge as they extend to far-flung areas such as Djibouti in Africa to Greece in Europe. Some of the famous Infrastructural development projects include the Peljesac Bridge in Croatia, the Hambantota Port, the Colombo Port City in Sri Lanka, Piraeus Port in Greece, Gwadar Port in southwestern Pakistan and the Mombasa-Nairobi railway line in Kenya.

The infrastructural development seemed to have worked at home for the Chinese economy itself.  With its ambitious infrastructural investments under the BRI, it hopes to repeat the same success for the regions involved and the global economy at large.