Open Europe Berlin

Control of trade routes is decisive. By Prince Michael von Liechtenstein

MvL

Trade between East and West has always been important on the huge Eurasian continent. What we now describe as the “silk road” was a complex network of trade and caravan routes running from China and Japan in the Far East to the Middle East, Anatolia and Europe in the west.

Map GIS

When these land routes became disrupted after the fall of the Mongol Empire founded by Genghis Khan (1162-1227), the Europeans sought access to East Asia via the oceans. These attempts, beginning in the mid-15th century, inaugurated the great age of maritime exploration, inadvertently leading to the discovery of the Americas and the creation of the European colonial empires.

Resurgent China has returned to its own tradition of being the leading economic and political power. Its economic expansion requires secure trading routes for its exports, while its political aspirations can only be realized with the help of allies. Allies can be acquired either through shared economic and strategic interests, or by submission through power. Usually, some combination of both is involved. As the relationship evolves, cultural ties often develop, and these can often help deepen and stabilize the long-term alliance.

Chinese strategy

The Belt and Road Initiative (BRI) is a development strategy that attempts to meet these two goals – secure trading routes and political allies – at once. It combines the Silk Road Economic Belt (SREB) on land and the Maritime Silk Road (MSR) by sea.

On land, the silk road runs from eastern China to the northwest through Russia and on to Europe, or branches due west across the remote Chinese province of Xinjiang through Central Asia and the Caspian Sea region, with three alternative destinations – Europe, Anatolia or the Middle East.

The maritime option leads from China’s great seaports through the Malacca Straits to the Indian Ocean, providing easy access to East Africa (an important source of raw materials) and beyond that to Europe, either through the Suez Canal or via the longer route around the Cape of Good Hope.

For Beijing, the Malacca Straits are risky strategically. This narrow choke point is controlled by Singapore and Indonesia, both close to the world’s supreme naval power, the United States. Hence the importance of the alternative land route being built from Xinjiang across the Himalayas to Pakistan, where China is developing the Port of Gwadar on the Indian Ocean.

These huge projects have the following advantages for Beijing:

  • They give China controlled trade routes for its manufactured exports and the import of necessary raw materials, intermediate and capital goods.
  • They consolidate China’s political and economic influence in countries hosting these infrastructure projects.
  • Land connections through Russia and Central Asia allow faster connections with Europe, and especially to Central Europe. Just as important, these routes are less vulnerable to interruption in case of a conflict with the U.S.
  • They open up the remote and landlocked western province of Xinjiang to trade, investment and business opportunities by giving it direct access to markets in the west (Europe, the Middle East) and south (Pakistan and the Indian Ocean). This is an important aspect of China’s long-term development, which has so far been concentrated in the prosperous coastal areas of the East.

China is also ramping up its naval capabilities. The immediate and overriding goal is to protect its maritime trade and to consolidate its hegemonic aspirations along the East Asian littoral. But in the longer term, China also hopes eventually to level the playing field with the present global hegemon, the U.S.

Protecting seaborne commerce will mean a stronger Chinese naval presence first in the Indian Ocean, but later in the Mediterranean as well, to protect the vital Suez Canal route. Just this month China dispatched troops to its first overseas naval base in Djibouti, where the Red Sea and the Indian Ocean meet, directly astride the approaches to the Suez Canal.

These naval aspirations are integral to Beijing’s global ambitions of challenging the U.S. Naturally, the American response has been to try to contain China. The U.S. is reinforcing its ties with India and the Southeast Asia countries, as well as Taiwan, Japan and South Korea. This emerging dynamic, in which the U.S. plays the dominant, established power while a rising China refuses to accept its place and seeks to break out of containment, makes future conflicts a likely scenario and does not exclude the possibility of outright war. This makes China’s land links extremely important.

European passivity

Astonishingly, Europe’s role in these developments – so important economically, politically and strategically for the entire world – has been virtually zero. At stake are Europe’s links to what will soon be the largest markets on the planet. Yet Europe is as passive today as China was in the 18th and 19th centuries, when Europe occupied most of Asia. This was a time when Europe’s control of the maritime trade routes allowed it to dominate most of the globe.

We have already discussed the advantages of the Belt and Road initiative for China. However, Europe’s need for improved trade routes is just as great. The entire continent could use better access to East Asian markets. Just as eastern China is favored by its access to the Pacific, so has Western Europe benefited and grown prosperous by its access to the Atlantic trade. The expanded land routes that would help western China develop would also bring more prosperity to Central and Eastern Europe, through better access to Asian markets.

The trade links being established by China are of vital importance to Europe’s future. But it is dangerous to leave the initiative exclusively to Beijing, as this would mean surrendering control and many advantages. For Europe, the BRI presents an enormous opportunity. It should actively participate, as a strong partner of China and the nations along the road, in establishing the land and maritime routes.

An important and overlooked advantage of European engagement in these projects would be to make them less provocative to the U.S. Since Europe would remain a strong U.S. ally and a partner in NATO, its involvement in protecting the sea lanes and developing ports along the Indian Ocean would make the whole initiative less threatening than if it were mainly a Chinese project. On the land routes, European participation could give the Central Asian nations more options besides choosing between Russia and China.

Europe’s fate in business and world politics may well be decided in Central Asia and the Indian Ocean. Losing influence over these trade and communication routes, or ceding control to another hegemon, would be a disastrous choice.

Prince Michael is Founder and Chairman of Geopolitical Intelligence Services AG Vaduz. This opinion piece was published by GIS here.

 

21

Jul 2017

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