Illustration: Chen Xia/GT

China's ambitious One Belt and One Road (OBOR) initiative is shaping up to become one of the centerpieces of the country's global development strategy. OBOR is an umbrella term that refers to the Silk Road economic belt and the 21st century Maritime Silk Road, two expansive trade promotion and infrastructure development projects which draw inspiration from the historic Silk Road that connected China with the outside world.

As their names may imply, the economic belt and the Maritime Silk Road are meant to deepen economic relations between China and its trading partners in central Asia, Southeast Asia, Africa and other parts of the developing world through investments in infrastructure and preferential trade agreements. The OBOR project was proposed by Chinese President Xi Jinping during his visits to Kazakhstan and Indonesia in 2013. It later garnered broad international attention during the Asia-Pacific Economic Cooperation (APEC) meeting in November when China announced that the country would establish a $40 billion Silk Road Fund to help pay for projects in participating countries.

For China, these twin passageways into key emerging market areas can help the country acquire resources, expand its strategic depth, relieve overcapacity pressures at home and cement its dominance in global trade. Of course, China won't be the only beneficiary of the OBOR initiative. Other countries involved in the plan have much to gain from deeper integration with China.

The existing global system of multi-lateral trade best represented by the World Trade Organization is in the midst of a radical overhaul. China now faces a choice. It can seek to join new multi-lateral cooperations like the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP), both of which are now under negotiation. It can also actively adapt to the changing international landscape and seek to become a leader in global trade. Based on statements issued after the 18th National Congress of the Communist Party of China (CPC), China has opted for the latter path.

Indeed, the Shanghai Free Trade Zone (FTZ) represents an early step toward furthering China's foreign trade agenda. Blueprints for the FTZ focus on promoting regional economic cooperation and developing global trade. Recent statements from officials suggest that China is likely to implement its OBOR initiative  first through the development of additional free trade zones within its own borders.

China is also obviously willing to accelerate infrastructure spending and construction, increasing the interconnections between various planned FTZs. In this way, China will first promote growth at home in underdeveloped central and western regions such as Xinjiang Uyghur Autonomous Region, Gansu Province, Ningxia Hui Autonomous Region, Guangxi Zhuang Autonomous Region and Yunnan Province. With time, FTZs and trade promotion areas in such regions are likely to develop into nods on a transnational economic belt that spans into locales such as India and Turkey.

The OBOR is definitely becoming a core feature of China's expanding role in the global economy. Assisted by development at home and investment abroad, China can succeed in winning a larger voice for itself and its partners in world trade.

The article is based on an editorial published in China Business News. bizopinion@globaltimes.com.cn

China Business News