$10 trillion trade expected in five years
KUWAIT: The initiative of the Silk Road Economic Belt and the 21st Century Maritime Silk Road is a long-term opportunity to achieve economic prosperity in world’s countries, mainly the Arab ones. This initiative is in line with the visions of His Highness the Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah aiming to transform Kuwait into a global commercial hub by 2030, and also to establish the ‘Silk City’ project launched in 2006. This embodies new horizons and wider ambitions to revive the historic Silk Road.
The initiative of the Belt and Road includes two sections; First the Silk Road Economic Belt which links China with Europe via Central and Western Asia, and the 21st Century Maritime Silk Road which extends from south of China to southeast of Asia and Africa. The Belt links more than 60 countries, with expected investments ranging between $4 and 8 trillion, and serves 4.4 billion people, making up 63 percent of the world’s total population.
Trade amongst countries along the Belt and Road is expected to hit $10 trillion in the five upcoming years. According to figures issued by Chinese government, China has invested about $50 billion in countries along the Belt and the Road since 2013. The State of Kuwait will take part in this Road with several development projects, which materialize the ‘Kuwait’s 2030’ vision.
The Silk City project, one of the world’s largest, includes the Jaber Causeway, which links strategically Kuwait to the northern region. The city’s project, which accommodates up to 700,000 people, contains the establishment of a 1001-meter tower, which is a world’s height one. Investments of the projects are expected to hit $100 billion.
The Jaber Causeway, the fourth longest one in the world, constitutes a key factor in developing and setting up the free economic zone in northern Kuwait where five islands are expected to establish near Iran’s and Iraq’s beaches. The project of setting up the five islands includes the establishment of Mubarak Al-Kabeer port, which will help the country be open to the world commercially and economically, and serves Kuwait’s interests with Iraq and Iran. The port will be a key pivotal of regional transport linking the earth to sea via several means of transportations like high ways and railways. Such projects will contribute greatly to achieving partnerships between both public and private sectors to materialize the vision of His Highness the Amir.
The State of Kuwait has deep-rooted relationships with China for a long time; their diplomatic ties have been established since 1971. And Kuwait was the first country that signed a document of cooperation in taking part in the initiative of reviving the Silk Road since 2013.
In 1982, Kuwait Fund for Arab Economic Development contributed, for the first time, to financing 37 projects in China estimated at KD 380 ($950 million. In 2015, China’s total exports to Kuwait hit $5 billion, while its imports from this Gulf country reached $807 million, according to specialized statistic in 2015. China ranked first in trade exchange with Kuwait. Total trade between China and Arab countries amounted to $251 billion in 2014, an increase of 5.2 percent compared with 2013, ranking the second largest trading partner of these states. The two sides seek to speed up trade volume to $600 billion in the next 10 years.
Last year, China announced during a conference that it would allocate, in collaboration with Arab countries, special loans estimated at $15 billion, and commercial loans worth $10 billion for Middle East countries, in addition to establishing two funds with Qatar and UAE for joint investments worth $20 billion. According to statistics by China’s ministry of commerce, total imports and exports volume between China and countries along the Belt and Road reached about $914 billion in 2016, while new projects contracts fulfilled by China in the countries along the Road hit about $126 billion, an increase of 36 percent. At the beginning of this year, China’s non-financial direct investments with countries along the Belt and Road amounted to $10.6 percent of the total foreign investment, a rise of 1.2 percent compared with 2016.
China has established a fund of $40 billion in 2015 to provide investment services to economies of countries along the Road. China has built so far 56 trade and economic cooperation zones with more than 20 countries along the Belt and Road. Accumulated investment of these zones exceeded $18.5 billion.
The Belt and Road Forum for International Cooperation will be held in Beijing in May, with the participation of heads of states, premiers, ministers and academics from more than 80 countries. The State of Kuwait will participate in this event, with a high-profile delegation headed by Minister of the Amiri Diwan Affairs Sheikh Nasser Sabah Al-Ahmad Al-Sabah. – KUNA