A former Australian ambassador to China believes that the Belt and Road Initiative will provide a definitive boost to not only the Australian economy, but also that of the world.
The initiative, launched by China in 2013, aims to build a trade and infrastructure network connecting Asia with Europe and Africa along the ancient Silk Road trading routes, leading to mutually beneficial economic outcomes for every nation it reaches.
One of the ways in which the initiative will improve outcomes is through infrastructure bringing access to otherwise unavailable natural deposits, which former Australian Ambassador to China, Geoff Raby told Xinhua on Friday is an important part of achieving economic success.
"The Belt and Road is focusing on infrastructure development, but there are clearly some very important natural resource deposits, not just coal but in many areas, that could benefit infrastructure investment under the initiative," Raby said.
"To liberate those resources, where currently, they are not commercial to develop, but under the Belt and Road, it opens up all of that."
Raby contends that not only will the initiative be beneficial in opening up new natural resource opportunities, but also drive further need of commodities from existing partners to China, like Australia, to fuel the infrastructure growth that will take place as a result of the exciting developments in the pipeline.
"The extent that Belt and Road investment, wherever it is, increases global demand for steel, that certainly benefits Australia quite directly. Both in terms of iron ore, but also coking coal," Raby said.
"So it's a very positive development for Australia in that respect."
But, Raby insists that increased demand for commodities is not the only benefit to Australia, and rather, there is a more definitive, and direct benefit that will stem from the initiative; increased prosperity in the many nations that it touches with its prosperity changing, nation building projects.
"There is another, second order aspect to the Belt and Road Initiative that people don't really focus on, but they should. The infrastructure build, in developing countries, in poorer countries, the infrastructure built there by China helps to lift those countries overall level of economic growth," Raby said.
"That is a real benefit to Australia."
The economic relationship between China and Australia is built on mutual understanding, and win-win scenarios, and Raby was quick to point out the significance of the ongoing cooperation between the two nations.
"It is the most important economic relationship Australia has, and will ever have in the future. It will encompass everything, and Australia's economic fortunes are very closely tied up with China's." Raby said.
The relationship is not a one-way street however, and Raby believes that Australia has played a major role in supplying China with the resources, and services, to fuel the demand of the burgeoning middle class, and continue the supply-side growth success China has achieved.
"I think Australia and China, as I have said for many years, are highly complementary economies, they fit together very well," Raby said.
"And I think we are going to see that even more so, as China is transitioning now into a consumption led economy. Where the whole range of Australian services will be increasingly in demand by the growing Chinese middle class."
