Silk Road revives with booming trade, economic cooperation inside SCO framework
13/6/2006 17:13
Kazakh merchant Zianblativ has his fingers crossed that a cross-border
trade zone between China and Kazakhstan will bring him good fortune on a
historic trade route.
"It'll reduce costs and risks if I can reach deals with
Chinese merchants right here at the trade zone," he said. "It costs dearly and
takes weeks for me to load Chinese made commodities in Urumqi of Xinjiang and
ship them all the way to Almaty."
Construction has begun on the Chinese side
of the cross-border trade zone at Korgas port. The one-billion-US-dollar project
will provide closer economic and trade links between China and Kazakhstan and
eventually to other central Asian and European markets.
The Chinese side of
the project will take at least five years to complete, but Chen Mingjie, a
businesswoman in Xinjiang, is already thinking about taking up border trade
again, nine years after she was forced to quit the market amid business declines
at Korgas port.
Korgas was a major stopping-off site on the Silk Road, a
network of 7,000 km of trails that connected ancient China with India, Western
Asia and Europe 2,000 years ago.
Closer ties within the framework of the
Shanghai Cooperation Organization (SCO), an organization established in June
2001 among China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan,
have rejuvenated the ancient road in recent years.
But the new Silk Road
features booming trade on a wide variety of commodities, including oil and gas,
far beyond the traditional silk and chinaware pieces carried on camel
backs.
"Energy road" running through central, eastern Asia
On May 25, a
962-km oil pipeline started piping oil from Kazakhstan to China, a move experts
say will intensify China's cooperation with the central Asian nations in the
energy sector.
The new oil shipping route will link Chinese consumers with
the oil fields of the Caspian Sea, and alleviate China's excessive reliance on
the Strait of Malacca, a traditional route for 80 percent of China's imported
oil, said Yin Juntai, deputy general manager of China Petroleum Exploration and
Development Company.
The route is also part of the "energy road" running
through central and eastern Asia as the central Asian nations have been tapping
the Chinese market to expand their own energy exports and to seek economic
integration with the Asia Pacific region through China.
Kazakhstan alone has
reported an average 10 percent GDP growth for three consecutive years thanks to
its strategy to rejuvenate the country with oil and gas.
In April, Russia
launched the construction of its longest oil pipeline from eastern Siberia to
the Pacific Ocean, a 4,000-km project whose branch line is expected to pipe 30
million tons of oil to China annually.
Intensified cooperation with other SCO
member states in the energy sector has provided China with the much-needed power
resources, particularly in large cities like Shanghai, the birthplace of the SCO
The city will replace compressed coal gas with piped natural gas for at least
100,000 more households this year.
Oil imports through central Asia will help
reinforce Shanghai's projected oil and gas supply network backed by natural gas
from the East China Sea, western China and liquefied natural gas imports, said
sources with the city's Natural Gas Supplies Co Ltd
New Euroasia
transportation corridor leading to the Atlantic
The upcoming SCO summit on
Thursday will also be discussing the SCO member countries' cooperation in the
transportation sector.
The recent completion of the Chinese section of the
new Silk Road, from Lianyungang in east China's Jiangsu Province to Helgus in
Xinjiang, will push the construction of a Euroasia transportation corridor that
runs 11,000 km from China's east coast to Rotterdam via 18 Chinese provincial
areas and more than 20 countries and regions including Kazakhstan, Russia,
Belarus, Poland and Germany.
Cross-border road transportation is playing an
increasingly vital role in promoting economic development, cultural exchange and
social prosperity in Asia and Europe, said Chinese Vice Premier Huang
Ju.
"The Chinese government attaches great importance to the transportation
industry and has invested large sums into such projects," he said, adding that
China will step up international transportation cooperation and make more
efforts for the construction of a new Silk Road and a Euroasia continental
bridge.
By the end of 2004, the most recent time that data is available,
China has signed ten bilateral motor transport treaties and three multilateral
intergovernmental treaties with Russia, Mongolia, Kazakhstan, Kyrgyzstan,
Tajikistan, Pakistan, Uzbekistan, Laos, Vietnam, Nepal and set 60 international
road ports and more than 140 international passenger liners.
Ultimate goal:
common prosperity
With the SCO's goals of expand regional cooperation and
seeking common prosperity, the six member states have stricken 127 cooperation
deals and set up seven professional work teams to promote multilateral
cooperation in product quality inspection, customs, e-commerce, investment
promotion, transportation, energy and telecommunications sectors.
The six
countries have agreed to give priority to cooperation in the transportation,
energy, telecommunication, agriculture, household electric appliances, light
industry and textile sectors, gradually ensure the free flow of goods, capital,
services and technologies in the region and eventually set up a free trade zone
within the SCO's framework.
"SCO enjoys massive potentials in bolstering
regional economic cooperation," said Zhao Jinping, an economist with the
Development Research Center of the State Council, or the Chinese central
government. "If the region achieves economic integrity, the combined GDP of the
six member economies will make up about 30 percent of the world's total by
2020."
China reported nearly US$40 billion of trade with other SCO members in
2005, up 212 percent over that of 2001, the year the SCO was founded, according
to the Ministry of Commerce.
The ministry said China's actual investment in
the other five SCO members totaled US$eight billion last year, four times the
2001 figure.
Xinhua News
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