3. The Silk Highway

(based on an ancient trade network, called the Silk Road, for goods (like silk) and ideas extending thousands of kilometres across Europe and Asia with connections)
- refers to the economic focus shifting to the developing/emerging world, ie shifting from West to East (into Indo-Asia including countries like India, China, South Korea, Vietnam, Indonesia, etc) and a lesser extent from North to South (into South America including countries like Brazil, Chile, Argentina, etc and African subcontinent like South Africa, etc)

This is linked with the decline of the USA. In the late 1940s, US accounted for a 1/3 of the world's output; now it produces only 20% (2018) and declining. This relative decline and "domestic exhaustion" is creating the opportunity for competition from other countries, like China (Janan Ganesh, 2018). 

- a fundamental restructuring of the world economy with the emerging economies in Asia, Latin America and Africa producing the major share of the global economic output, eg experiencing growth rates of around 10% compared with the established Western economies of around 3%; by 2010 the world's wealth was split evenly between OECD  and non-OECD countries, but by 2030 is expected to be 60% non-OECD and 40% OECD economies. Over the 6-year period from 2005 to 2010, direct investment outflow from China to the rest the world increased from US$ 12.3 b. to 68 b., eg average annual growth of around 80%.

- rapid economic growth and urbanisation is reshaping lifestyle patterns and has the potential to build a wealthier, more stable, better connected and friendlier world. For example, China, over a few decades, has transitioned from an agriculturally-based economy to an industrial one and is now entering a service sector economy.

- in the coming decades it is estimated that 1+ b people will transition out of poverty and as income levels rise, more food will be consumed with a preference for high-protein foods like meat

- some industries that will benefit include the service industry such as tourism, investment, education, soft commodities (agricultural products, especially high-protein, etc) etc, eg Chinese tourists travelling overseas has gone from 10 m. (2000) to 70 m. (2011)
"...the basic premise is that as per capita GDP (ie people's income) grows and over 1 million people in the Asia region alone cross and an income threshold from being poor to middle-class, they shift expenditure from products to services..."
Stefan Hajkowicz, 2015

silk_road

 

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