Understanding China's Belt & Road Initiative: Motivation, framework and assessment

The Belt & Road Initiative is China's greatest international economic ambition, aiming at stimulating economic development in a vast region covering sub regions in Asia, Europe and Africa, which accounts for 64% of world population and 30% of world GDP. The Initiative is devised to reconfigure China's external sector in order to continue its strong growth. While infrastructure development plays a central role, the Belt & Road Initiative is a comprehensive one, including also policy dialogue, unimpeded trade, financial support and people-to-people exchange. It is too early to assess the impact of this ambitious Initiative. It certainly has the potential of turning the underdeveloped Belt & Road region into a new vibrant economic pillar and contributing to economic policy thinking by incorporating successful experiences of emerging market economies. However, the Initiative also faces very high barriers, including lack of central coordination mechanism, potential dash of different political regimes and beliefs and financial viability of cross-border projects. (C) 2016 Elsevier Inc. All rights reserved.