As thousands of papers and articles have discussed the implications of the coronavirus pandemic, these repercussions on national and global economies have highlighted the importance of strong and advanced IT infrastructures in controlling and mitigating the health and economic effects of the pandemic and then assisting in reviving the economy. And when talking about technology and Corona, China is the first thing to come to mind as a story of success of artistically using a huge infrastructure of technology and data processing to combat the pandemic.
The Chinese success in this field is a global raw modal of the country’s technological capabilities and a marking martial to further spread this service across the world through what China calls the Digital Silk Road.
Back to the Basics
Before analyzing the era awaiting the world a small recap on the basic two terms is essential:
Belt and Road Initiative (BRI): According to the Economist magazine, The BRI is China’s project to create a modern-day Silk Road, the ancient network of trade routes which once connected east and west. Billions of dollars have been invested since it was launched in 2013 across over 60 countries, in disparate infrastructure projects including railways, roads and ports.
Digital Silk Road (DSR): The Digital Silk Road, also called the ‘Information Silk Road’, brings advanced IT infrastructure to BRI countries, such as broadband networks, e-commerce hubs and smart cities. The Digital Silk Road is driven by China’s tech giants, who are able to deliver high-quality fiber optic cables at much lower costs than their European and US competitors.
Some History to Analyze the Future
1- The Launch of the Silk Road Infrastructure: The Belt and Road Initiative
A publication by the “Silk Road Briefing” argues that back in 2013, China Belt and Road Initiative was launched as a significant shift in global trade, laying the foundations for a paradigm shift in supply chain and logistics management. Many failed to see that the BRI is not just an infrastructure connectivity strategy. It is the vehicle by which China is restoring the ancient Silk Road. This is achieved through the integration of maritime and land-based transportation and logistics routes. The inland Belt and the maritime Road converge on key port infrastructure through a coordinated pairing of maritime/port/land transport routes.
Furthermore, these new port / rail pairings signaled the start of new trade hubs and ecosystems. Whilst many focused on either the maritime road or inland belt, China was steadily creating a supporting ecosystem. These ecosystems consist not just of the port, but includes special trade zones, services and access to inland dry ports and hubs. Initially seen as disparate entities, there was always going to be a need for a level of information and data integration that would optimize total productive output in these paired hubs.
2- A Digital Ecosystem to hold the Infrastructure: Digital Silk Road
The realization that there were gaps in digital applications, China introduced the DSR in 2015. Initially the digital revolution to improve supply chain visibility and transparency through IoT and data generation. Running parallel to these smart port developments has been the progression to “smart shipping” and ‘smart cities”. These developments highlighted that independent data silos were being created when the real need was for these independent platforms to communicate with each other.
Essentially the DSR incorporates telecoms, media and technology to develop the BRI across Asia, the Middle East, Europe, Africa and Latin America. The three drivers are: Chinese telecoms equipment makers, Data Centre and Storage Infrastructure along the economic corridors, finally Chinese companies using this to export interpretation of smart city sensors and data platforms. Technology is an area that China feels it can compete head on with the USA and have leveraged this to create its own digital highway with its own standards.
To this end, China did not just look to cellular wireless infrastructure, but embarked on a program that built submarine and terrestrial optic fables as well as data centers. The extent of this program has seen China own or assist with the building of approximately 30% of existing cables in Asia and a 54% share of planned cables. In a global sense, China owns or supplies 11% of existing cables and 24% of planned cables. Furthermore, the domestic BeiDou satellite navigation system is now supported by more satellites (35 in total) than the USA aligned GPS navigation system. Thirty BRI nations have now signed for the BeiDou navigation network.
Digital Silk Road during the Coviid-19 Pandemic
Jude Blanchette, Freeman Chair in China Studies and Jonathan E. Hillman, Senior Fellow, Simon Chair in Political Economy, and Director, Reconnecting Asia Project argue in an article published in Center for Strategic and International Studies (CSIS) –a global think tank, that the pandemic is already providing new opportunities for China’s rise as a technology power and global provider of digital infrastructure.
This comeback begins at home, where China is already doubling down on its domestic 5G expansion. In June of last year, Beijing issued operating licenses to its giant state-owned telecom operators, and in November, these firms—China Mobile, China Unicom, and China Telecom—began rolling out a functional (if limited) 5G network in cities across the country.
But even as China battled to contain the spread of Covid-19, the Communist Party of China (CCP) continued to call for the expansion of 5G investments. On February 21, as much of the country was on lockdown, the CCP’s Politburo announced that the expansion of 5G was critical to economic recovery. On March 4, the Politburo’s Standing Committee—the apex of political power in China—called for “accelerating the construction of new infrastructure such as 5G networks and data centers.”
Confronting arguably the biggest economic crisis of his administration, President Xi Jinping still found time to personally press the issue of 5G. During an inspection tour of Zhejiang province In April, he declared, “We must seize the opportunities afforded by industrial digitalization and digital industrialization, accelerate the construction of new infrastructure such as 5G networks and data centers, and step up the layout of strategic emerging industries and future industries such as the digital economy, life and health, and new materials.”
But the push into 5G is not just a matter of economics. It is at the heart of a geopolitical battle with the United States for control of the global technology commanding heights. This, of course, explains why the CCP continued to press the issue of 5G even during the depths of the Covid-19 crisis. And as its economy begins to slowly—and unevenly—claw its way out of stasis, the push for 5G expansion will continue not only in China, but more importantly, through many of Beijing’s proliferating global infrastructure programs, including the Belt and Road Initiative (BRI) and the concomitant Digital Silk Road.
Money is racing out of emerging markets, and nearly half of the world’s countries are considering bailouts from the IMF. Compared to the massive transportation and energy projects that have dominated the BRI’s early years, information and communications technology projects are generally lower cost, easier to deliver, and easier to monetize.
Chinese tech companies also see an opening to pitch their products as part of responding to the current outbreak and preventing future pandemics.
