Global Value Chains along the New Silk Road

Providing a passageway for goods between east and west, however, cannot be its main goal. It needs to attract investment to diversify its economies from petroleum and other natural resources. Other parts of Asia have developed by linking with global value chains. This may be an option for Central Asia, but it must overcome some serious barriers to make that a reality.

Key points

• The New Silk Road provides a land bridge linking East Asia and Europe.
• The benefits for Central Asia of being merely a goods conduit will be limited.
• Participation in global value chains (GVCs) has helped to speed industrialization in Southeast Asia and other subregions.
• National economic strategy in Central Asia can include efforts to attract investments in GVCs.
• For greater GVC investment, policy makers can improve trade facilitation, create a supportive business environment, develop small and medium-sized enterprises, and skill the workforce.

Policy Brief 2015-2