China’s Important Contributions to Globalization as a Vital Player in a Changing World

Globalization has long been considered a powerful force for global economic growth, and the great story of China’s development and progress over the four decades since reform and opening-up was launched, is deeply connected to the process of globalization. China has benefited from and significantly contributed to the process of globalization by increasing the movement of goods, services, finance, data, and people across borders. China’s advance and rise on the international stage form a basis to play a constructive role in to address the new challenges associated with globalization. This also includes assisting to update global governance mechanisms, acting as a catalyst for regional integration, and further serving as a locomotive for the global economy.

Four decades of growth has led to a significant increase the welfare of Chinese citizens, and China became one of the main drivers of globalization. The country’s rise from the periphery of international trade to the world's trading powerhouse has been swift. China’s share of global exports of goods between 1978 and 2020 is an excellent testimony of the rapid rise. Constituting only 0.8% in 1978, this figure increased to 14.7% in 2020, which was a significant achievement. With this success story, China has become the number one exporter of goods in the world.

China actively participates in and strongly supports economic globalization. In order to jointly sustain the stability and growth of the world economy and trade, China is committed to the promotion of a multilateral trading system and eager to expand its cooperation with other nations on the basis of equality and mutual respect. The fact that its development path is closely tied to the rest of the world, China intertwines its own growth objectives within the context of the global development. This is the foundation of China’s efforts to promote and maintain a strong and sustainable community with a shared future for mankind.

Besides to being the second largest economy and the top exporter of goods, China has recently emerged as a global economic superpower and has been investing significantly in infrastructure and development projects overseas as part of the Belt and Road Initiative (BRI), which was launched by President Xi Jinping in 2013. This initiative is an important mechanism to bring nations together by improving connectivity and advancing trade routes along the Ancient Silk Road and beyond. This is a crucial step towards the realization of common development for all mankind in a globalized world. In this sense, BRI should be considered one of China’ most important contributions to globalization.

However, it should also be emphasized that globalization has also caused certain inequalities in the society. Digitalization and automation in many industries has triggered unemployment, while at the same time positively affecting trends in global trade. Today, the threats of conflict, pandemics, environmental disasters, as well as calls for protectionism and other challenges are on the rise and these developments could damage consequences as the world continues to struggle to jump-start growth. In turn, above-mentioned situation could also create the real risks for China, whose economic prospects are deeply interweaved with its integration into the world markets.

China’s unprecedented development, especially over the past decade, and the progress that has been achieved in many spheres, demonstrate ample opportunities this country possesses. China’s global economic and infrastructure initiatives like BRI, a great anti-poverty strategy that lifted 800 million people out of poverty, environmental policies and projects that greatly affected environmental standards and many other undertakings are clear examples of China’s great achievements and contribution to joint development with win-win results that many countries can learn from.

It is essential to point out the vast changes in China’s economic system over the past 40 years, which paved the way to become the second-largest economy in the world. China’s path of development and reform is unique and often referred as the ‘China Model’ of development. Today, we are still witnessing China’s comprehensive development, increases of its industrial potential, achievements in space exploration, significant advance of its military-industrial complex, improved transport and logistics capabilities and growing trade and economic cooperation with the whole world. Furthermore, China's efforts to contribute to the protection of environment, its successful domestic policy in the field of social services and increasing the welfare of the people, the implementation of an effective policy of reforms and openness all contribute to the strengthening of China's international image, its rapid entry into the ranks of world economic leaders, and the implementation of a balanced foreign policy.

Generally, attention should be drawn to the fact that Chinese society exists in a flux of constant creation, with its own ups and downs, as well as trials and errors. But this also leads to constant learning and success, which, in turn, results in new creations and new achievements.

China’s further economic development has already been forecasted by several well-known financial organizations and research centers, and it is believed that China will become the largest economy in the world in the nearest future. This success means that all countries are keen to work with China to profit from mutually beneficial cooperation with China is not an exception. We are ready to work together with China in order to improve our bilateral economic ties, substantially increase trade and imporive our rapidly developing bilateral relations to a higher level.

Azerbaijan and China: Two Friendly Nations and Strong Partners Along the Ancient Silk Road

As one of China’s main trade partner in the South Caucasus, Azerbaijan attaches special importance to the development of relations with China in all spheres. It is no coincidence that during the meeting between the President of the Republic of Azerbaijan Ilham Aliyev with President Xi Jinping in April 2019 in Beijing as part of the Second Belt and Road International Cooperation Forum, President Xi referred to the President of Azerbaijan as “a great friend of the Chinese people”, while President Aliyev, in turn, called President Xi as a “reliable friend of the Azerbaijani people”. Thanks to the efforts of our leaders and the political dialogue established at the level of the heads of state, the current relations between our states are characterized as a multidimensional partnership which is on the track to move to the level a strategic partnership.

It should be noted with satisfaction that relations between Azerbaijan and China has demonstrated rapid growth, especially over the past decade. The strong political willingness and friendship between the current leaders of our countries have ensured tremendous achievements in all aspects of bilateral relations, including cooperation in trade, energy, humanitarian, transportation and logistics and etc. spheres.

One of the most remarkable examples of this successful cooperation could be observed in the field of economy and trade, which is fundamentally a result of the partnership created by the “BRI” Initiative. Azerbaijan was among the first countries to support this very important global initiative and our country has made a significant contribution to its realization. In this context, projects like the Baku-Tbilisi-Kars railway, initiated by Azerbaijan, as well as the commissioning of the Baku International Sea Trade Port in Alat, eventually resulted in the formation of the Trans-Caspian International Transport Route (Middle Corridor or TITR).

The main aim of the Middle Corridor was to ensure the additional efficient alternative route connectivity between China and Europe, and vice versa, which could take much less time than sea shipping. The recent geopolitical situation proved that formation of the Middle Corridor (TITR) was very far-sighted and visionary approach. Today, companies from Azerbaijan, Kazakhstan and Georgia, as well as various shipping companies, railways and ports of Türkiye, Ukraine, Romania and Poland all participate in the TITR.

As it was mentioned above the latest global challenges and geopolitical uncertainties have made the transportation of goods through the Middle Corridor more critical than ever, which creates the need for improved efficiency along this route. To this end, a trilateral organization made up of ministers from Azerbaijan, Türkiye and Kazakhstan was established last year to enhance cooperation and optimize the effectiveness of the Middle Corridor and identify future steps to further improvement of the route. Upon its completion, the China-Kyrgyzstan-Uzbekistan railroad could also become a part of the Middle Corridor, but it is essential that all projects implemented in Azerbaijan and the Western Caspian region be synchronized. Thus, Azerbaijan is planning to increase the capacity of the Baku International Sea Trade Port from 15 to 25 million tons.

The TITR and other infrastructure projects have enabled Azerbaijan to become a regional shipping and logistical hub and opened up new opportunities for cooperation with other countries, making a tangible contribution to the rapid and high-quality transportation of goods along East-West and North-South Corridors. Despite its lack of access to worldwide sea routes, Azerbaijan has already built an important transport network, including railways, road and air transport that could be used to deliver goods to European consumers.

As early 2022, the main route connecting northeast Asia with Europe was the Eurasian Northern Corridor. Goods were transported along the Trans-Siberian railway from Russia’s Far East through Kazakhstan and Mongolia. According to a preliminary report conducted by the European Bank for Reconstruction and Development (EBRD) on sustainable transport connections between Central Asia and Europe, the Eurasian Northern Corridor was responsible for transporting around 1.5 million 20-foot equivalent units (TEUs) of cargo or containers. The Russia-Ukraine conflict has negatively impacted the use of the route for an unknown period. As a result, the completion of the Middle Corridor and the transportation of goods from China to Europe through the Middle Corridor has become more relevant. In early 2022, approximately 20,000 TEUs travelled through the Caspian Sea ports of Aktau and Kuryk in Kazakhstan. This figure continued to rise throughout the year and the amount of transit cargo passing through Azerbaijan increased by 75% compared to 2021.

During the bilateral meeting between the leaders of Azerbaijan and China on the sidelines of the 2022 SCO Summit in Samarkand, President Aliyev emphasized the excellent prospects for cooperation and partnership within the Middle Corridor and Belt and Road projects. He underlined that Azerbaijan plays an essential role in transport links between China and Europe, adding that the country’s transport and logistical capabilities are of great importance in international cargo shipments.

During this meeting, it was also emphasized that Azerbaijan is currently implementing large-scale reconstruction work in newly liberated territories of Azerbaijan. Many Chinese companies have also shown interest to participate in this work and of course, Azerbaijan supports the involvement of Chinese companies in reviving the Karabakh and Eastern Zangazur economic regions of Azerbaijan. In this regard, Huawei’s participation in a smart village project in the liberated city of Zangilan in Azerbaijan is a clear indicator of the mutual trust and practical cooperation between our countries.

In addition to re-establishing the shortest route between Azerbaijan proper and its exclave of Nakhchivan, the planned Zangazur corridor will play a significant role in connecting East-West and North-South transportation routes. As a transit across the Caucasus, the new Zangazur corridor will significantly reduce the transportation time between China and Europe, complementing the Baku-Tbilisi-Kars railway and facilitating trade and business. This new corridor will play an important role in terms of connectivity along the Belt and Road and create great prospects for Azerbaijan and China to expand cooperation in the transportation and logistics sectors.

However, infrastructure development is not limited to upgrading existing physical roads, railways and sea ports. It also includes digitalization and improvement of the digital networks that link Azerbaijan to the world via the Internet. One of the major tasks Azerbaijan has put forward is the “Digital Silk Way” project that includes the establishment of a digital telecommunications corridor between Europe and Asia. The project, implemented under the “Azerbaijan Digital Hub” program, envisages the transfer of digital content and internet services from European Internet centers to Asian countries via Azerbaijan. The project will enable Azerbaijan to play a central and strategic role in telecommunications, transmitting Internet services and content from major content operators such as Google, Amazon, Alibaba, Netflix, Facebook and others. In the future, with the establishment of the Internet Exchange Centre in Baku, the country will transmit this content and other internet traffic to Central and South Asia, and other neighboring countries in the region.

The “Digital Silk Way” is of great importance to countries in Central and South Asia, where internet traffic has been increasing. To this end, “AzerTelecom” and “China Telecom” signed a Strategic Memorandum of Understanding within the framework of the Second Belt and Road International Cooperation Forum, which was held on 25–27 April 2019 in Beijing, laying the foundation for cooperation between “AzerTelecom” and “China Telecom” in the creation of a telecommunications corridor (the Digital Silk Way) between Asia and Europe under the framework of the “Azerbaijan Digital Hub” program.

Future Prospects on Cooperation Between Azerbaijan and China in Green Energy Development

Since it was first proposed in 2013, China’s BRI has taken on many forms. A clear-eyed strategy to connect Asia with Africa and Europe via land and maritime networks, the BRI’s primary goals are regional integration and the stimulation of trade and economic growth. Yet, these goals are not limited to any singular aspect of trade, logistics or infrastructure but also include green goals through technology, investment in capacity building, and information sharing. In this context, Azerbaijan has a great deal to contribute in bilaterally cooperation with China and within the BRI in terms of energy transition and green energy development.

Azerbaijan is a country with rich oil and gas reserves, which means Azerbaijan plays an important role in terms of the energy security of Europe today. TANAP and TAP pipelines, as part of the Southern Gas Corridor, carry natural gas from the Caspian Sea reserves directly to the European marketplace. A Memorandum of Understanding on a Strategic Partnership in the Field of Energy, signed between the European Commission and Azerbaijan on July 18, 2022, states that the annual imports of natural gas from Azerbaijan to Europe will double by 2027.

Along with all these developments, while improving Azerbaijan’s position as a key supplier of oil and gas, our country is also keen on contributing to the transition to green energy. More than 8% of the electricity produced in Azerbaijan today is made using renewable resources, but the Ministry of Energy of Azerbaijan has set a goal to increase this figure to 30% by 2030. The goal is attainable given the fact that Azerbaijan’s geographical location creates favorable conditions for developing renewable energy. Most importantly, green energy projects are essential for the liberated territories of Azerbaijan. It is no coincidence that the Karabakh and Eastern Zangazur economic regions have been declared “green zones” by President Ilham Aliyev. These liberated lands have huge potential in terms of wind and solar energy generation, and Azerbaijan has already started implementing numerous green projects in those territories.

Azerbaijan is also planning to increase its green energy production to a level that it will enable to export electricity. An agreement signed by the leaders of Azerbaijan, Georgia, Romania and Hungary last year to build an underwater electric cable through the Black Sea will allow Azerbaijan to export electricity to the European market and further contribute to the energy security of Europe. Azerbaijan currently produces 27 GW of wind and solar power, and green projects being implemented throughout the country, especially in the Karabakh and Eastern Zangazur economic regions, will increase energy production and enable us to even greater volumes of energy to the European marketplace.

Taking all of this into account, we believe there are huge opportunities to cooperate with China in the area of green energy infrastructure, especially in light of China’s considerable experience in this sector and the advanced technologies Chinese companies have developed to make energy transition easier and more achievable. It is pleasant to be witnessed that several Chinese companies are already participating in green energy projects in Azerbaijan, but we welcome even more Chinese companies to join us in our goal to reach green objectives.