Growth Powers Belt and Road

China and the US in the recent G20 Summit traded barbs regarding China’s Steel overcapacity which is having a drastic impact on the world steel market.  The US particularly sees the PRC’s steel over production  as a threat to its own industries.  However this is also complicated by the socioeconomic changes within the US in which steel production has been greatly reduced since its early days as the world’s steel producing giant.

Current figures project that the PRC produced nearly half the world’s steel.  According to PRC figures from it’s Belt and Road Initiative, China has reduced its capacity from 59.9 trillion to 23.23 trillion tons.  And this reduction comes in the wake of new PRC data which indicates, China’s State Owned Enterprises (SOEs) earned an estimated increase of 14.3% in total revenue.   The current US president has repeatedly threatened to levy tariffs on the republic, citing America’s reduced steel producing capacity and its own competitiveness in the world market.

The Belt and Road Initiative is indicative of China’s continued massive growth.  Its ability to unilaterally reach out to worldwide partners continues to under-gird its influence throughout the word.   The PRC is reported to have earned $202.1 billion USD in profit from its centrally administered SOEs in the period between January and November 2017.  As businesses, entrepreneurs and executives, we should keep a circumspect eye on the PRC’s Belt and Road Initiative.  It may be that the Initiative may become the catalyst for future world growth.

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