"One Belt, One Road": Tapping the potential
Growth in Asia Pacific

"One Belt, One Road": Tapping the potential

China's massive development initiative is driving huge investments all along its route. Our Frans Kok tells you about its impact and how AEB can help your company take advantage right now.

Singapore and China recently signed a memorandum that forms a panel to discuss issues surrounding the development of projects in Chinese President Xi Jinping’s "One Belt, One Road" initiative.

Singapore, an early supporter of One Belt, One Road, the ambitious Xi strategy aimed at reviving ancient trade routes to more closely tie Europe, Africa and Asia, is working to involve itself in projects with China and other countries. They are far from alone. A World Bank report last year said the initiative includes some 65 other countries that account collectively for over 30 percent of global GDP, 62 percent of population, and 75 percent of known energy reserves.

The one belt initiative consists primarily of the Silk Road Economic Belt, linking China to Central and South Asia and onward to Europe, and the New Maritime Silk Road, linking China to the nations of South East Asia, the Gulf Countries, North Africa, and on to Europe. Six other economic corridors have been identified to link other countries to the Belt and the Road.

In Asian Pacific, Xi’s project means the promise of enormous economic growth, not just from government investment – though it will be massive – but from investments made by companies from across the globe that want to take part in what could be the largest project of its kind ever.

The project is not all about infrastructure

"In a lot of ways this is seen as a project that is all about infrastructure, like the building of roads and highways and ports and airports. But it’s important to remember that as all of those projects go on and are completed that what they are really doing is encouraging free trade and making it easier for companies to move products from country-to-country,’’ said Frans Kok, General Manager of AEB Asia Pacific.

Kok’s point is perhaps best illustrated by the growing number of corporate investors who want their own operations in place and want them growing as belt and road expands.

  • DHL is opening new intermodal transportation routes which span across Eurasia, including multiple China-Europe rail lines. It says the combinations of sea, rail, road, and air transportation methods reduce transport costs six-fold while cutting carbon emissions by 90% when compared with air freight.
  • General Electric says Xi’s project is opening up new markets for its products all along its path. GE leaders have said the New Silk Road will boost third-party country sales from $1 billion to $10 billion per year, as the corporation works to find enhanced synergy with Chinese companies that are operating along the various routes.
  • U.S, multinational Caterpillar sees one belt as a key growth area for the sale of its construction machinery. Caterpillar has built one of the world’s largest construction machinery factories in the city of Xuzhou, China to meet the rising demand from the project.
  • Honeywell, the American conglomerate, has said the belt and road plan is key to its future growth.  Honeywell makes commercial and consumer products, engineering services and aerospace systems. ''The initiative promises to raise the level of connectivity, cooperation and trade between dozens of nations that have traded with China for thousands of years,'' said Shane Tedjarati, President of Honeywell Global High Growth Regions.

The list of investing companies is nearly endless and accounts for the production, assembly or shipping of everything from laptop computers, to cell phones, to lawnmowers, to washing machines to parts for a BMW.

For Kok, One Belt, One Road presents an opportunity to assist companies looking to establish themselves in Asia Pacific or expand the trading operations they already have there.

Frans Kok, General Manager, AEB Asia Pacific
Frans Kok, General Manager, AEB Asia Pacific

AEB solutions for companies involved in One Belt, One Road

‘’AEB has been a strong presence here for more than 15 years we are in an excellent position to provide companies with the software solutions that will help them maximize the benefits of their investments,'' he said. Our solutions for companies involved in One Belt, One Road include:

Customs Management: It is the central platform for managing your customs processes. With end-to-end IT integration and smart automation, you accelerate your customs processes and save valuable resources. The many features include integration of your customs brokers around the world, local direct filing, and a powerful solution for classifying your product portfolio.

Logistics & Supply Chain Collaboration: It works together with all your supply chain partners. The functionalities include continuous bi-directional status exchanges at every level – transport, order, consignment, or the individual item. It includes carrier integration, warehouse management, freight cost controls, and much more.

Trade Compliance Management: It automatically runs restricted party screening and relevant export control checks for you in the background of your transactions. It also includes options for conveniently managing licenses and keeping an eye on trade risks across your organization. Quickly and reliably, while the rest of your business continues uninterrupted.