Sara Hsu
Sara Hsu

Massive investments along the planned new silk road, and planned new economic zones, might offer cities in poorer provinces like Xinjiang and Yunnan great opportunities to develop, writes financial analyst Sara Hsu in the Diplomat.

Sara Hsu:

The northern Silk Road represents an opportunity to transport resources from Western China, and countries West of China, to the east, and development of areas along the road may entice migration within China from east to west. Several cities have sought to be a part of this project. Zhengzhou in Henan province lies close to the planned start of the New Silk Road in Xi’an, and plans to fast-track its development plans for its airport, high speed rail, and other projects, aiming to become an aviation and economic hub. Horgos, on the border with Kazakhstan, a land port to central Asia, was approved in 2014 as a city and is in the process of developing a special economic zone.

Other areas have already received investment in anticipation of increased activity along the New Silk Roads. In the northern region, Lanzhou New Area was established in September 2012 and is a planned city for 500,000 residents; it is attempting to become a high-tech research center. A high-speed railway, the Lanxin railway, linking Urumqi in Xinjiang with Xining in Qinghai along the New Silk Road, was opened less than one month ago. In the southern region, a long road was sculpted through the hilly region between Kunming, capital of Yunnan, to the Laotian border in 2008. A railway line running from Kunming to Hekou, on the border of Vietnam, is expected to be finished this year. An expressway between Kunming and Ruili, on the border of Myanmar, is in the process of being built.

Prior development along the northern New Silk Road has lagged since this region is extremely barren and mountainous, crossing the Gobi Desert, encompassing many mountain passes, and moving through a landlocked region far from any sea. Development in the southern region has been equally challenging given the highly mountainous terrain. Creation of economic development zones and infrastructure will build up these areas.

As these underdeveloped regions grow, additional development measures will need to be taken, especially regarding the provision of water in the northern pass. Attention must also be paid to enhancing the education and skills of the poor farmers and herders on the planned northern and southern Silk Roads to ensure that development is inclusive, not just profitable for larger enterprises and resource users on the east coast. If carried out in a balanced way, the New Silk Road could have a big impact on cities dotted along the corridor.

More in the Diplomat.

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