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Modern Silk Road: China and Turkey - the new development paradigm

by Cemil Ertem

Mar 22, 2014 - 12:00 am GMT+3
by Cemil Ertem Mar 22, 2014 12:00 am
Today, China is implementing a new kind of growth, more precisely a new development path.

The country no longer utilizes an export-based growth model that uses cheap labor and worthless local currency, which produces poverty for its own people. Rather, it adheres to a new approach of development-prosperity that emphasizes domestic consumption, high quality exports, brand goods and enriches the people.

Thus, China will maintain its position as the global factory; however, it will not use cheap labor and worthless local money like before. The Chinese economy is starting a quality competition rather than depending on low-quality, imitation products, which means, at the same time, a new kind of division of labor for the global economy, as China will export not only goods but also capital and technology from now on. It is not possible to confine this change to China; yet, we can say that this trend started with China.

Giovanni Arrighi, an Italian scholar of political economy and sociology, defines the case as the new "Asian Development" in his book "Adam Smith in Beijing" (2007, London). This new development bears the dynamics of the rapid transition from an industrial society to an information society.

For example, China and many developing Asian countries promote the development of knowledge-intensive industries without giving up labor-intensive ones. Secondly, this new development paradigm is based on a perception that differs from the Western development approach in that it has bound limits, rapidly integrates instead of having homogeneous markets under the auspices of the national state, eliminates borders and reproduces technology by sharing.

The most distinctive and important feature of the new kind of Asian development is that tradable goods can reach all markets with homogeneous pricing and speed without having to deal with differing custom regulations. This being the case, we can define this new paradigm as a development paradigm that is not inter-country but inter- continent, which integrates economic and political integration between countries and regions. This new way of development creates different locations for production processes. Today, with technology rapidly expanding, production of a single good can be carried out in different locations for each independent part. Thus, quick, reliable and cheap intercontinental transfer of goods becomes crucial, even inevitable.

Today, there are three prominent routes that link Pacific Asia to the European market.

These are critically important commercial passages that complete each other and enable economic integration between Asia and Europe. We should note that these routes achieve prominence because railway transportation, especially high-speed rail lines, are much more advantageous compared to other options in terms of speed, price and safety.

One of the three main corridors that link developing Asia, primarily China, to Europe is the Northern Corridor that passes through the Russian mainland via the Trans-Siberian Railway (TAR) and reaches Europe across Kazakhstan and Belarus. As you know, Russia has had a custom's union with Belarus and Kazakhstan since 2010. The Northern Corridor has had quite serious political drawbacks for the West since the Crimean crisis. The second is the Central Corridor that starts in China and goes to Kazakhstan in the north and reaches Europe across Turkmenistan, the Caspian Sea (ferry), Azerbaijan and Turkey.

The third is the Southern Corridor that starts in Kazakhstan and uses the Turkmenistan-Iran-Turkey line. With regard to these routes, which will constitute the new Silk Road and connect Asia with Europe, it is obvious that the Central and Southern corridors are inevitably important for Europe and the U.S. within the framework of the Transatlantic Trade and Investment Partnership (TTIP) between the U.S. and the EU.

However, heading north to go south over Kazakhstan is undesirable. A route starting in China and going south across South Korea - while at the same time embracing critical markets like Vietnam - and going through India and using the Pakistan-Afghanistan-Iran-Turkey route is also vitally important.

Nevertheless, it is not possible for this route to come into play due to potential political problems in the future. Under these circumstances, the Central Corridor is the best alternative for the Silk Road. That is why Turkey attached critical importance to the railway through Georgia and Azerbaijan to Baku-Tbilisi-Kars. The construction of this railway will be completed soon, creating one of the most important passages.
The new Silk Road or Central and Southern Corridors create the following vital options for the West: 1) We have to recognize the reality of China and developing Asia, which puts forward a new development paradigm.

This development has to come in contact with the West. Political integration is highly important for this meeting to be peaceful.

This is only possible via the routes of the New Silk Road. 2) No matter which route becomes prominent, the key country for the New Silk Road is Turkey. That is why the whole world should be concerned with peace, democracy and stability in Turkey. Any instability in Turkey would bring about crisis and disaster all over the world. 3) The New Silk Road and Central-Southern corridors are, at the same time, unique options for transmitting new energy sources outside Russia to Europe. In this sense, the New Silk Road and the Southern Gas Corridor are siblings for which Turkey is the key country. To put it another way, the routes of the Silk Road are the only alternative for growth and avoiding crises in Europe and for global peace. After all, isn't it obvious why some want Turkey to be discredited?

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