Comment: Time for Scots businesses to rediscover China
There’s a real sense that geo-political tectonic plates are on the move across the world. Donald Trump’s “America First” slogan implies isolationism and a reluctance to embrace free trade.
The UK detaches itself from the EU and looks over the horizon for trading partners. The EU seeks to manage the social upheaval created by the refugee crisis and sustain social stability and economic opportunity for its citizens in a larger family of nations. And in Asia, the Korean crisis is exposing the regional and global alliances that were formed over 60 years ago and have kept the peace since.
One constant in all of this is the continued influence and relevance of China as an economic and political superpower. Some of the numbers are astonishing: The Chinese government holds the largest foreign exchange reserves in the world and, with it, the largest US$ holding, currently estimated at $3.23 trillion; China now has 100 cities of over one million people, a number that is likely to double in the next decade; China is the number one nation in trade, accounting for almost 14 per cent of global exports; the number of Chinese with at least 10 million yuan ($1.47 million) of investable assets hit 1.6 million in 2016, up from 180,000 in 2006; China is a major player in renewable energy – every hour, China erects another wind turbine and installs enough solar panels to cover a football pitch.
So where does all of this leave us in Scotland? Gordon Brown’s perspective on all of this is going to be interesting. A conference in Edinburgh this week will hear the former Prime Minister’s view on these changes and their implications for Scotland and the UK. He’ll deliver a keynote address at “Sustainable Silk Roads”, in the University of Edinburgh’s newly re-furbished McEwan Hall, where delegates will gather to discuss China’s “Belt and Road” initiative, the cornerstone of President Xi Jinping’s economic development strategy.
The conference on Wednesday and Thursday will see the largest and most influential gathering yet of global experts on China in Scotland, providing delegates with first-hand knowledge of the country, the policy and the role that Scotland, Scottish institutions and enterprises can play in Belt and Road. It will bring about the construction of massive roads and ports infrastructure, designed to shorten the distance, and time, between China and the Western world, backed by inter-governmental strategic alliances.
China watchers estimate that it plans to pump $150bn into such projects every year. The ratings agency Fitch estimates that a startling $900bn in projects is currently planned or under way.
China will facilitate infrastructure growth well beyond its borders, with plans that include pipelines and a port in Pakistan, bridges in Bangladesh and rail connections to Russia – all with the aim of creating a “modern Silk Road” that will usher in “a new era of globalisation” with China at its centre. With the arrival of the first freight train from Yiwu (Zhejiang) into London earlier this year, Belt and Road has inarguably reached the UK.
This conference aims to make that known in Scotland, where it will be the first of its kind on this scale. Scotland’s own strengths in innovative technologies and low carbon solutions makes it an ideal place to consider how sustainable strategies and solutions can be developed for projects along the Belt and Road and help companies here understand how to grasp the opportunities it presents.
Demonstrating an understanding of Belt and Road, therefore, is more than a way of being polite to your Chinese guests, or hosts, it’s a real chance for Scottish institutions and companies to get involved. The Sustainable Silk Roads Conference is being organised by the Confucius Institute in the University of Edinburgh, the China Britain Business Council, the Department for International Trade (DIT) and the Edinburgh Centre for Carbon Innovation, as a forum in which Scottish policy-makers, firms and academics can develop their knowledge of the B&R programme and consider how they might get involved.
Moreover, although the conference will focus on sustainability and Scotland’s growing expertise in renewable energy, sustainable construction, finance and data technology, there is ample room for others to get on board too.
Open trade routes and open for business policies mean increased access to market for a raft of premium products, including Scottish food, whisky and textiles.
Sustainable Silk Roads takes place at the McEwan Hall, Edinburgh, on 4 and 5 October: www.confuciusinstitute.ac.uk/ssr
Peter Budd CBE is a consultant to Arup. He has worked on the design and delivery of major building and infrastructure projects in China over the past 35 years.