China’s exports to Central Asia are booming – Asia Times

China’s exports to Central Asia are booming - Asia Times

Central Asia is becoming&nbsp, one of&nbsp, Eurasia ‘s&nbsp, main&nbsp, trade and transit&nbsp, hubs, with Kazakhstan&nbsp, in&nbsp, the forefront.

Sino- Central Asian trade&nbsp, turnover&nbsp, stood atUS$ 89.4&nbsp, billion &nbsp, at&nbsp, the end of 2023, a 27 %&nbsp, increase over&nbsp, the&nbsp, 2022 level of&nbsp, US$ 70.2 billion, &nbsp, according to&nbsp, China’s Customs Agency. &nbsp, Of that overall, US$ 61.4&nbsp, billion represented Chinese imports to the area.

Trade between China and Kazakhstan&nbsp, alone&nbsp, clocked in at&nbsp, a whopping US$ 41 billion &nbsp, –&nbsp, or&nbsp, 46 % of&nbsp, China’s total trade turnover with all of Central Asia. &nbsp, That represents a&nbsp, 32 % &nbsp, increase over its 2022 turnover&nbsp, at year’s end. &nbsp,

In January and February&nbsp, of this year, &nbsp, China’s exports&nbsp, to all the countries in the arc from&nbsp, Türkiye to Kazakhstan increased 31 % &nbsp, compared with the&nbsp, first&nbsp, two months of 2022. &nbsp, China’s trade with&nbsp, Azerbaijan&nbsp, jumped&nbsp, 83 % &nbsp, over the same period&nbsp, –&nbsp, nearly&nbsp, double the percentage increase in trade with&nbsp, any other country in the region. &nbsp,

China ‘s&nbsp, total&nbsp, commerce with the&nbsp, Global South, &nbsp, which includes&nbsp, Central Asia, &nbsp, made&nbsp, up&nbsp, for strong declines&nbsp, in trade&nbsp, in developed countries, including&nbsp, with the United States, &nbsp, the&nbsp, European Union and Japan, as David Goldman&nbsp, recently&nbsp, showed&nbsp, in&nbsp, Asia Times. &nbsp,

What explains the enormous rise in&nbsp, Chinese&nbsp, exports&nbsp, to Central Asia and the Caucasus? &nbsp, This history deserves some&nbsp, attention&nbsp, considering, as Goldman said, “global supply stores and their leasing” are shifting. &nbsp,

Politics and business

For well over two decades now, &nbsp, Azerbaijan, &nbsp, Kazakhstan, &nbsp, and&nbsp, Kyrgyzstan and, more just Turkmenistan and&nbsp, Uzbekistan, &nbsp, have &nbsp, engaged&nbsp, in&nbsp, smart&nbsp, diplomatic and multilateral&nbsp, politics, &nbsp, which includes&nbsp, promoting&nbsp, deal across Eurasia. &nbsp, &nbsp, To&nbsp, increase&nbsp, regional&nbsp, trade&nbsp, churn, &nbsp, these states&nbsp, usually work&nbsp, in concert&nbsp, to utilize their collective power, when needed, they&nbsp, go&nbsp, it alone&nbsp, but usually manage to avoid&nbsp, stepping on one nother’s feet. &nbsp,

Aiding this energy is the process of Central Asian heads of state to regularly&nbsp, visit one another in people. &nbsp, For instance, Kazakhstan’s President Kassym- Jomart Tokayev&nbsp, and&nbsp, Uzbekistan’s President Shavkat Mirziyoyev&nbsp, have met in person&nbsp, twelve&nbsp, days since 2018. &nbsp, Really two weeks ago, President Tokayev&nbsp, met with Azerbaijan’s President Ilham Aliyev in Baku to defend now substantial business and travel contracts. &nbsp,

Key Eastern presidents&nbsp, travel&nbsp, to Beijing on a regular basis. &nbsp, Present Xi Jinping has personally&nbsp, visited Astana, &nbsp, Tashkent, Bishkek, &nbsp, Ashgabat&nbsp, and Dushanbe&nbsp, many times&nbsp, to&nbsp, promote&nbsp, trade and investment activities. &nbsp, In January 2024, &nbsp, Uzbekistan’s President Shavkat Mirziyoyev visited&nbsp, Xi&nbsp, in Beijing. &nbsp,

So, &nbsp, Eurasian economic&nbsp, convergence&nbsp, continues apace even&nbsp, in the face of&nbsp, devastating wars in Eastern Europe and the Middle East and the common suspects grousing&nbsp, about debt traps, &nbsp, non- market- generated trade imbalances&nbsp, and different complaints that are intended to prevent trade&nbsp, but usually backfire. &nbsp,

The nations of&nbsp, Central Asia, &nbsp, the Caucasus&nbsp, and China recognize that, to secure businesses for their export ( and exports ), they must&nbsp, build and maintain available, &nbsp, nicely- functioning&nbsp, travel corridors across Eurasia. &nbsp, This is so because&nbsp, Central Asia is land- locked, and China is vulnerable to maritime blockades. In this sense, their interests align. &nbsp,

Other factors driving china exports

Central Asian leaders are on board with&nbsp, BRICS&nbsp, and its&nbsp, ever- expanding&nbsp, membership, &nbsp, China’s Belt and Road&nbsp, Initiative, &nbsp, the&nbsp, United States ‘ C5 1&nbsp, ( resurrected from the dead last year ) and&nbsp, B5 1&nbsp, ( just launched ), &nbsp, the&nbsp, Eurasian Economic Union&nbsp, and many other similar structures, &nbsp, which they see as promoting trade. &nbsp,

In addition, &nbsp, the&nbsp, World Bank, &nbsp, the&nbsp, European Bank for Reconstruction and Development, &nbsp, the&nbsp, Asian Development Bank, &nbsp, the&nbsp, Eurasian Development Bank, &nbsp, the&nbsp, China Development&nbsp, Bank, &nbsp, and&nbsp, various&nbsp, Middle Eastern&nbsp, states, among others, for years&nbsp, have been pouring money into Central Asia for&nbsp, infrastructure, logistics and transport&nbsp, corridors. &nbsp, At times, conflicting agendas come into play, of course, but&nbsp, that&nbsp, has n’t &nbsp, stopped&nbsp, the drive for&nbsp, Eurasian&nbsp, connectivity and&nbsp, integration. &nbsp,

It goes without saying&nbsp, that&nbsp, initiatives such as&nbsp, the&nbsp, Trans- Caspian International Transport Route, &nbsp, the International North- South Transport Corridor, &nbsp, the&nbsp, China- Kyrgyz- Uzbekistan&nbsp, Railway, &nbsp, and the&nbsp, Uzbekistan–Afghanistan–Pakistan&nbsp, Railway&nbsp, are all welcome, albeit the latter two still requiring much work. &nbsp,

On the investment side, &nbsp, Kazakhstan alone&nbsp, is expecting&nbsp, at least$ 150&nbsp, billion &nbsp, in&nbsp, foreign direct investment&nbsp, by 2029, a prospect&nbsp, commercial enterprises welcome&nbsp, and&nbsp, which&nbsp, is backed up by&nbsp, the&nbsp, billions of dollars&nbsp, that have been spent on&nbsp, infrastructure&nbsp, development &nbsp, since the 1990s. &nbsp,

Trade and business activity go hand in hand. &nbsp, &nbsp, For example, in Uzbekistan, &nbsp, according to Interfax, China opened 854 new businesses in 2023, 210 % more than in 2022. &nbsp, Russian, Turkish and South Korean&nbsp, businesses&nbsp, are also&nbsp, very active&nbsp, whereas EU and US&nbsp, investments in the SME sector&nbsp, are &nbsp, lagging. &nbsp, The&nbsp, banking sector’s willingness to provide credit&nbsp, is also a factor&nbsp, in&nbsp, the region’s flourishing trade. &nbsp,

So is the existence of more than&nbsp, dozens of&nbsp, special economic or export processing zones&nbsp, in Central Asia and the Caucasus. &nbsp, While&nbsp, not all are &nbsp, up and running, some&nbsp, are and those are having a positive impact on trade&nbsp, &nbsp, For example, &nbsp, Kazakh Railroads&nbsp, recently&nbsp, concluded&nbsp, a&nbsp, memorandum&nbsp, of understanding&nbsp, with&nbsp, the&nbsp, Chinese company Xi’an Free Trade Port Construction and Operation Co, &nbsp, LTD, &nbsp, to facilitate cross- border trade. &nbsp, And in November 2023, the Xinjiang Pilot Free Trade Zone (FTZ), the first in China’s northwestern border region, officially&nbsp, opened, such projects contribute to the flow of goods. &nbsp,

Likewise, after years of work, &nbsp, notwithstanding challenges, &nbsp, cross- border trade has &nbsp, benefited&nbsp, from efforts to improve regulatory measures, digitalization, tariff harmonization, border procedures and interoperability. &nbsp, USAID has been prominent in&nbsp, this arena. &nbsp,

Finally, &nbsp, China ‘s&nbsp, trade with Central Asia benefits&nbsp, from&nbsp, the&nbsp, general&nbsp, drive to institutionalize&nbsp, an&nbsp,” all- weather payment mechanism” &nbsp, – a&nbsp, currency &nbsp, system that functions without&nbsp, third party interference. For example, in 2022, &nbsp, Kazakhstan and China signed a&nbsp, Memorandum on Mutual Settlements in yuan, &nbsp, as reported&nbsp, by&nbsp, the&nbsp, Astana Times. &nbsp, Other initiatives are in the works. &nbsp,

Smart diplomacy, &nbsp, the&nbsp, on- going process of&nbsp, Eurasian integration, the&nbsp, need for&nbsp, dependable&nbsp, non- maritime&nbsp, transport routes, strong&nbsp, regional&nbsp, economic growth&nbsp, and&nbsp, demand for Chinese goods, &nbsp, continued&nbsp, capital investments, &nbsp, the need to avoid northern corridors across Eurasia&nbsp, and the personal leadership of presidents&nbsp, across the region&nbsp, – all contribute&nbsp, to the&nbsp, striking rise&nbsp, in China ‘s&nbsp, exports to Central Asia and the Caucasus.

This trend can be anticipated to continue for the foreseeable future because these factors are grounded in the interests of the states involved in the national self-interest, barring any significant changes to global geo-economics. &nbsp, &nbsp,