What are the benefits of the "One Belt, One Road" initiative for Uzbekistan?

On October 17-18 of this year, a summit on the "Belt and Road" initiative will take place in Beijing (China). The President of Uzbekistan, Shavkat Mirziyoyev, will participate in this summit.

Which countries are included in the project promoted by China, the "Belt and Road"? How beneficial is this project for Uzbekistan? Economic analyst Shukhrat Rasul answered these questions.

"The forum in Beijing will mark the 10th anniversary of the large-scale global infrastructure and energy initiative proposed by Chinese President Xi Jinping, which was announced as a revival of the ancient Silk Road to stimulate global trade.

The Chinese "Belt and Road" project consists of two main routes. The first is overland, and the second is maritime. The overland initiative was originally established in 2006. It involves roads that pass through Russia, Kazakhstan, and Uzbekistan. Afghanistan is currently joining this trend. The program promises to bring enormous benefits to each participating country."

According to the specialist, China might relocate some of its enterprises to Uzbekistan and Kazakhstan.

"By participating in this project, Uzbekistan will earn fees for the transit of goods. If products arriving from China remain in Uzbekistan, a customs duty will also be levied. China will establish infrastructure here for the distribution of its goods. However, if China relocates its companies, the prices of its products exported to Europe will decrease. For instance, China could process Uzbek cotton here, turning it into finished products for sale in Europe. In this regard, joint ventures and tax residents could be established in Uzbekistan. The increase in the number of enterprises will also create new jobs. This is highly beneficial for both parties."

When explaining the relationship between Uzbekistan and China, I often use the example of the relationship between Mexico and the USA. In the 1970s and 80s, Mexico was unable to break into the top 100 in GDP. Now, Mexico has risen to 13th place. This was not by chance. Today, most of the largest American automotive companies have moved to Mexico. China could also transfer its automotive industry to Uzbekistan. This is because we have, as is known, cheaper labor compared to China. Thus, Uzbekistan could replicate the experience of Mexico."