Initiative likely to raise world GDP by 4.2 percent in 2040, major economics report says
China’s Belt and Road Initiative is likely to boost world GDP by $7.1 trillion annually within the next two decades, involving up to $8 trillion of spending over the next quarter century via global infrastructure and other related projects, according to the latest figures from a major economics report.
The initiative is likely to raise global gross domestic product by about 4.2 percent in 2040, or 8.3 percent of GDP this year, with up to 56 countries forecast to have their annual GDP in 2040 boosted by more than $10 billion as a result, the report from the London-based Center for Economics and Business Research consultancy showed.
Laying out some of the most detailed benefits of the BRI so far, the center’s 40-page report, “From Silk Road to Silicon Road: How the Belt and Road Initiative will Transform the Global Economy”, was written for the Chartered Institute of Building worldwide professional body representing construction and property professionals. It was provided to China Daily ahead of its public release this week.
The BRI “is the most ambitious and largest infrastructure project arguably in history and will eventually touch more than two-thirds of the world’s population across some 65 or more countries. Its impact and effect will be felt for generations”, the institute’s president, Chris Soffe, wrote in the report.
“Although currently the BRI has about $2 trillion of projects already on the drawing board, we believe that as it succeeds it will expand to encompass many other projects,” reported the center, which analyzed the economic impact of transport and infrastructure, as well as trade frictions in its study.
The center identified a wide range of additional projects that seemed likely to link with the BRI, including a “green belt and road” global network of renewable energy sources and storage, upgraded highway links catering to autonomous vehicles, and an academic network connecting universities and scientific research with potential long-term impacts on technology and productivity.
Other than China, which by 2040 will be by far the world’s largest economy and which will therefore benefit from any boost to the world economy, the “biggest single potential beneficiary” of the initiative “is likely to be the US, even though it isn’t participating directly in the project. This is because of the sheer size of the US economy, which means that it gains from the indirect effects of world GDP being boosted”, according to the center.
“So bizarrely, despite the opposition of at least the Trump administration, the United States is positioned, potentially, to be the second-biggest beneficiary of the Belt and Road Initiative,” CEBR Founder and Deputy Chairman Douglas McWilliams told China Daily.
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