Question

These questions have to do with the One Belt Road Initiative.

• In general, how might this initiative affect sales of your product if you are located in the United States and want to export your product to one or more of the countries that are included in the Belt and Road Initiative?
• Next, using a specific product or product category, how might this initiative affect sales of your product?

Answer 1

Belt and road initiative is China's ambitious initiative to build a transportation network across the world that connects China to major consumption centers. This will reinforce China's dominant position in the world market.

Exporting a product from the US to a country included in the belt and road initiative will be costlier than exporting from China. That would render the US export of the product non-competitive, as transportation through the Chinese express roads will be cheaper.

For exporting electronic products from the US to Eastern Europe, the only viable option is airways. One can ship electronics from China by roads built as part of OBOR. Hence the transportation cost drastically drops for Chinese products. Hence export sales of US electronic products will drop.