Impact of the belt and road initiative on commercial maritime power

Highlights

• Developing an evaluation system of commercial maritime power (CMP).

• Analyzing the evolution of 32 countries’ CMP since the inception of the B&R Initiative.

• Countries along the routes of the initiative show good performances in the evolution of CMP.

Abstract

Since the Belt and Road (B&R) Initiative was launched in 2013, China’s investment in ports across the globe has promoted maritime connectivity, driven performance in shipping, and strengthened its commercial maritime power. With the objective of quantitatively evaluating a country’s commercial maritime power, we develop an evaluation system based on the literature and the analytic hierarchy process (AHP)-entropy method. We analyze the evolution of 32 countries’ commercial maritime power since the inception of the B&R Initiative. The main findings are as follows. First, our evaluation system of commercial maritime power consists of a hierarchy containing 4 components, 7 elements, and 32 factors. Second, the evolution of a country’s commercial maritime power can be assessed. The results show that countries along the routes of the initiative show good performances in the evolution of commercial maritime power. Third, we find that Vietnam not China shows the highest average annual growth rate.

Introduction

Since the Belt and Road (B&R) Initiative promoted, from 2013 to 2018, China’s direct investment in countries and regions along the routes of the initiative has exceeded $80 billion (Belt and Road Portal, 2019). This has proved beneficial to China. For example, investments in this vast maritime transport network have significantly increased China’s Liner Shipping Connectivity Index (LSCI), showing that Chinese ports have built connectivity with more than 200 countries and 600 main ports in the world, ranking it first in the world. Kynge and Campbell (2019) state that China understands maritime influence and has improved its maritime power by expanding its port network. Similarly, Len (2015) believes that the B&R Initiative not only promotes maritime connectivity but also consolidates China’s maritime power.

Regarding the definition of maritime power, the literature stresses that maritime power refers to the ability of a country to use the oceans for national advantage (Mahan, 2011, Gorshkov, 1977, DIRECTORATE, 1995). Furthermore, Till (2018) considers maritime power to not be simply about using the sea but also about the ability to influence the behaviors of others by what one does at sea or obtains from the sea. Mahan (2011) proposes six components of maritime power, which include geographical position, physical conformation, extent of territory, population, character of people, and character of the government. The above six components can be concluded as physical and political power. Subsequently, economic and naval force are introduced as new components of measuring maritime power, together with physical and political power (Kearsley, 1992, Sakhuja, 2011, Till, 2018). It can be concluded that physical, economic, naval and political power are the main determinants of a country’s maritime power.

This study is not concerned with naval power and concentrates on commercial maritime power. Referring to the commercial maritime power, it appears on the book named “China's Rise to Commercial Maritime Power” and written by Heine (1989). This book does not define its concept but the contents are related on maritime policy, maritime relationships with international organizations, merchant marine, shipbuilding, ports and trade. As Sakhuja (2011) stressed the economic dimension of maritime power, it pivots on the state’s ability to invest port infrastructure, build ships to conduct seaborne trade and to shape and conduct maritime business. In brief, we discuss the commercial maritime power mainly from the economic dimension of maritime power. The benefits of stronger commercial maritime power can be addressed from the perspectives of sea attributes and economic development. First, the earth’s sea and land ratio is approximately seven to three; human beings can exploit maritime resources such as food, oil, and gas and exchange cargo, information, and ideas through maritime trade to satisfy basic demands and accumulate wealth. If a country has stronger commercial maritime power, it can obtain more benefits from the sea. Second, according to the International Chamber of Shipping, international trade plays an important role in economic development, as 90% of the world’s trade volume is transported by sea. A country with stronger maritime power usually has the ability to promote its seaborne trade, which, in turn, promotes its economic development. In sum, with the growing importance of maritime power, more countries are keen to increase their maritime power to obtain more resources and benefits.

Consequently, this study explores the determinants of commercial maritime power by combining qualitative and quantitative approaches and ranking the main countries’ commercial maritime power. The remainder of this paper is organized as follows. Section 2 presents a literature review related with commercial maritime power. Section 3 describes the methodology employed to identify and weigh factors influencing a country’s commercial maritime power. Data description and empirical results are analyzed and reported in Section 4. 5 Discussion, 6 Conclusion present discussions and conclusions.