The Impact of ‘One Belt, One Road’ and its Effects on GDP Growth in China

Abstract

After the global financial crisis in 2008, the world economy started to slowdown. Due to decelerated growth rates in China, and with the endeavour to increase control over global trade, the Chinese President, Xi Jinping, launched the initiative ‘One Belt, One Road’, in September 2013. The initiative aims to encourage and stimulate economic growth in China, as well as enhance integration between countries connected to the new initiative. This research aimed to study the impact of ‘One Belt, One Road’ and its effects on GRP growth in Chinese provinces affected by the initiative. The calculated forecasts in this study indicate on decreased GRP growth in coming years. In order to prove that ‘One Belt, One Road’ and its infrastructure projects will have an impact on GRP, regressions analyses, including several variables that have an effect on GRP, were conducted. According to the results of this study, extended railways, highways as well as other factors connected to infrastructure projects prove that ‘One Belt, One Road’ will have positive effects on GRP growth in the selected provinces.