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The 5th China-Arab States Expo: Promising Economic Partnerships and More Joint Cooperation

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The China-Arab States Expo recently held its fifth session in Yinchuan, capital of northwest China’s Ningxia Hui Autonomous Province. Through this exhibition and other events, China aims to strengthen China-Arab relations and jointly advance high-quality bilateral cooperation in building the Belt and Road. This exhibition constitutes an opportunity for more joint cooperation and the creation of new spaces for development between the two sides. This year, more than 1,000 companies registered to participate in the exhibition’s virtual events and on the ground. About 239 companies showcased their products and their latest innovations on the exhibition floor, which covers an area of ​​about 12,000 square meters. Major companies, including “Huawei”, “JD.com” and 38 other of the world’s 500 most powerful companies, in addition to the 500 most powerful companies in China and industry-leading companies, were present at the exhibition, and the total number of visitors exceeded 10 million, including 120,000 visitors from abroad to view the exhibitions online.

In a message on the occasion of the exhibition, Chinese President Xi Jinping noted that the traditional friendship between the Chinese and Arab peoples is gaining momentum with the passage of time, and that in recent years, China and Arab countries have constantly strengthened strategic coordination and exchange of measures, and achieved cooperation in the joint construction of the “Belt and Road”. He mentioned that China and Arab countries have combined efforts to combat the epidemic in light of the outbreak of the new mutated variants of covid-19 virus, and set a model for mutual assistance and overcoming difficulties in a spirit of synergy and solidarity, stressing that his country is ready to work with Arab countries to seek cooperation and development, and jointly promote peaceful development, especially since Beijing remains the largest trading partner of Arab countries.

Within the framework of the exhibition’s activities, the UAE Minister of State for Foreign Trade, Dr. Thani bin Ahmed Al Zeyoudi, indicated that the exhibition represents a platform to strengthen the trade and economic relationship with China, especially since China is one of the largest trading partners of the UAE, explaining that the volume of non-oil trade between the two countries amounted to 74.4 billion US dollars. In 2020, including imports worth $39.3 billion, and the volume of non-oil exports amounting to $2.7 billion; China is the third largest investor in the UAE, as the volume of Chinese investment in the UAE until 2020 amounted to more than $5.4 billion. The UAE minister added that his country will continue to create an environment for the development of investment and trade, and will push the growth of global trade by strengthening the establishment of infrastructure, more particularly in the field of transport and logistics, especially since his country is ready for this step because it possesses the most advanced facilities and technologies in the world in this field, calling to continue explore areas that promote economic growth between the two countries, stressing that the UAE is witnessing a shift towards a more flexible and sustainable model that creates a huge opportunity in various fields.

The exhibition covers many fields, including clean energy, digital economy, healthcare, cross-border e-commerce, in addition to virtual exhibition events based on technologies such as 5G, artificial intelligence, big data and cloud computing. This exhibition is an opportunity to enhance the historical cooperation between China and the Arabs, which existed through the Silk Road and is renewed through the Belt and Road Initiative. To date, China has signed cooperation documents within the framework of the Belt and Road Initiative with 19 Arab countries as well as with the League of Arab States. This exhibition is an opportunity for Arab governments, trade organizations and institutions to open up to China and create more joint cooperation. The exhibition is a platform for China and the Arab countries to achieve the joint construction of the Belt and Road Initiative, as China has become a major economic partner for most Arab countries through huge trade exchanges. China has 250 million tons of crude oil from Arab countries, which is equivalent to half of the country’s total crude oil imports over the past year.

At the national level, eight cooperative projects were signed at the exhibition, with a total investment of 11.18 billion Yuan, including the integrated smart energy investment project in the Red Sea. Eight provinces and cities, including Beijing, Tianjin, Zhejiang, Henan and Guangdong, signed 12 investment projects with Arab countries and other countries along the Belt and Road, with a total investment of 7.43 billion Yuan. Since the launch of China-Arab states expo in 2013, the biennial exhibition has attracted more than 5,000 companies from nearly 110 countries. In 2019, 287 deals worth about 185.4 billion Yuan were signed during the activities of the fourth edition of the fair. Data released by the Chinese Ministry of Commerce indicate that Arab countries’ imports from China amounted to 122.9 billion US dollars last year, an increase of 2.1 percent year on year.

Foreign Ministry Spokesman Wang Wenbin said the China-Arab Expo is an important platform for China and Arab countries to jointly build the Belt and Road Initiative. A total of 277 partnership contracts were signed in this exhibition, with a total investment of 156.67 billion Yuan (about 24 billion dollars), during the exhibition, investments of about 154 billion Yuan were collected to support 199 projects, while 24 commercial projects worth 2.75 billion Yuan were signed during the exhibition. The increasing partnerships between Arab governments and institutions and China fully demonstrates the strong vitality of China and Arab countries to jointly seek cooperation and development, achieve mutual benefit and win-win results, and jointly build the Belt and Road with high quality.

The Chinese government’s special envoy to the Middle East, Zhai Jun, said that the China-Arab Expo has played an active role in promoting cooperation between the two sides in building the “Belt and Road” since its establishment in 2013, and has become an important platform for communicating development needs and deepening economic and trade cooperation. He stressed that Sino-Arab relations are like a steadfast tree against storms and major changes that the world has not witnessed for a hundred years with the pandemic of the century, which brought unprecedented repercussions on humanity, which provided a model for relations between the countries of the world and an example for south-south cooperation, adding that the two sides are working hard on maintaining sovereignty, independence, equality and the principle of non-interference in internal affairs, defending the legitimate rights and interests of developing countries, exchanging support in the conditions of the covid outbreak, providing preventive supplies, exchanging experiences via the internet, urgently dispatching medical teams, and cooperating in the clinical trial of the vaccine and joint production of vaccine packaging, Which embodied the brotherly feelings of solidarity in the spirit of one team in concrete steps.

The Chinese government’s special envoy to the Middle East added that his country has provided nearly 100 million doses of the Chinese vaccine to Arab countries as grants and exports, and has achieved fruitful cooperation with both Egypt and the UAE in the joint production of the vaccine, which provided strong assistance in the battle against the pandemic, stressing that it in the first half of this year, the volume of trade exchange between China and the Arab countries amounted to 144.27 billion US dollars, an increase of 25.7% year on year, which made China the largest trading partner of the Arab countries. It also imported 130 million tons of crude oil from Arab countries, thus making the Arabs the largest suppliers of crude oil to China, and cooperation between the two sides has made progress, in the fields of fifth-generation communications, big data, aviation and space, artificial intelligence and other advanced and modern technology, noting that there is huge potential for the development of the green economy in China and the Arab countries, and that cooperation has developed in the fields of solar energy, nuclear energy and other clean energy, which contributes to building the “Green Silk Road”.

He also noted that it is important in the next stage to continue to intensify high-level exchanges between China and the Arabs, deepen strategic communication, and continue to exchange firm support on issues related to vital interests and major concerns, while raising the banner of non-interference in internal affairs, and promoting unity, self-strengthening, solidarity and cooperation, and defending international justice and equity, and defending the interests of developing countries. Zhai Jun called for continuing to devote the spirit of solidarity to combat the pandemic, stressing that his country will do its best to meet the needs of Arab countries for Chinese vaccines, deepen cooperation in joint production of vaccines and local production, and the categorical rejection of politicizing the issue of tracing the origin of the virus in a way that helps achieve the dream of the renaissance for both nations.

Zhao Yongqing, permanent deputy head of the government of Ningxia Hui Autonomous Region, said that on the basis of institutional activities, the fifth China-Arab States Expo brought together the needs of China and Arab countries and what Ningxia could achieve. This exhibition resulted in the innovative creation of the China-Arab Energy Cooperation Summit Forum, Water Resources Forum, Clean Energy New Materials Exhibition, Digital Economy Exhibition, and Cross-Border E-Commerce Exhibition and so on, which built bridges for various institutions to participate in cooperation and investment within the framework of the Belt and Road Initiative.

It is remarkable that all the pavilions of the China and Arab Countries Exhibition are green and environmentally friendly private booths, with extensive use of the interaction of information, technologies and digital display methods, to achieve simultaneous display on the internet and on the ground, and the overall design highlights the international level and the concept of modern and contemporary design. This year’s exhibition used the latest information technology to achieve exhibition viewing via 5G technology, where the audience can view the exhibition site in real time through 360-degree panoramic views and through virtual reality glasses on site, leading to simultaneous exhibitions online and on the field.

According to reports from the exhibition, the previous four sessions of the China and Arab States Expo, a total of 112 countries and regions, 21 Chinese and foreign senior officials, 283 foreign ministers and guests, more than 5,000 domestic and foreign companies, and more than 40,000 visitors have witnessed the previous sessions. A total of 936 economic and trade cooperation projects were signed. The signed projects include modern agriculture, high-tech, energy and chemical engineering, biopharmaceuticals, equipment manufacturing, infrastructure, industrial park construction, “internet + medical health”, tourism cooperation and other areas.

A number of Sino-Arab bilateral and multilateral cooperation agencies have settled in Ningxia, including the China-Arab Center for Technology Transfer, the China-Arab Center for Agricultural Technology Transfer, and the Secretariat of the China-Arab Trade Mediation Center. This session of the exhibition achieved fruitful results in new areas of economic and trade cooperation. China Gezhouba Group Co., Ltd. and the management company of Tianjin Changsha Taida Industrial Park, signed cooperation projects on 5G, artificial intelligence, aerospace and others with Saudi Arabia, Egypt, the United Arab Emirates, Iraq and other countries and regions, effectively expanding the areas of economic and trade cooperation between China and Arab countries.

While the Emirati pavilion relied on the yellow color, symbol of the desert that characterizes the country, and the blue color that symbolizes the sea, in reference to the wide coasts it enjoys, the Moroccan pavilion was “completely digital” highlighting the characteristics of Morocco and its rich and multiple cultures. Chairman of the Association of African-Chinese Cooperation for Development in Morocco, Nasser Bouchiba, stressed that the exhibition is an important platform for strengthening cooperation between China and Arab countries, whether during the pandemic or after, explaining that all countries will face the effects of the slowdown in global economic growth, but the Chinese and Arabs, if they join hands and focus on economic and trade cooperation, will not be affected.

Thus, they will set an example in international economic and trade cooperation and give confidence to the process of global economic recovery, calling on Arab governments and commercial institutions, to seize this good opportunity to fully understand the Chinese market, and to actively work on marketing high-quality products, explaining that the geographical environment of the Arab world may provide opportunities to cooperate in the field of agriculture, where there are long stretches of beaches and large areas of deserts. The cultivation of oases is a lifeline for the development of people’s living conditions. The agricultural cooperative project between Morocco, China and France in the Erfoud Oasis in Morocco has achieved abundant fruits in this regard.

Mohamad Zreik is an independent researcher, doctor of international relations. His areas of research interests are related to the Foreign Policy of China, Belt and Road Initiative, Middle Eastern Studies, China-Arab relations, East Asian Affairs, Geopolitics of Eurasia, and Political Economy. Mohamad has many studies and articles published in high ranked journals and well-known international newspapers. His writings have been translated into many languages, including French, Arabic, Spanish, German, Albanian, Russian, Bosnian, Bulgarian, etc.

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Economy

Egypt’s “Too Big to Fail” Theory Once Again at Test

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Authors: Reem Mansour & Mohamed A. Fouad

In the wake of 2022 FED’s hawkish monetary policy, the Arab world’s most populous nation, Egypt, saw an exodus of about USD20bn of foreign capital.  A feat that exerted pressure on the value of its pound against the dollar slashing it by almost half.  This led to USD12bn trade backlog accumulating in Egypt’s ports by December 2022.

Meanwhile, amidst foreign debt nearing USD170bn, inflation soaring to double digits, and a chronic balance of payment deficit, Egypt became structurally unfit to sustain global shocks; the country saw its foreign debt mounting to 35% of GDP, causing the financing gap to hover at USD20billion. 

While it may seem all gloom and doom, friends from the GCC rushed to inject funds in the “too big to fail” country, sparing it, an arguably, ill-fate that was well reflected in its Eurobond yields spreads and credit default swaps, a measure that assesses a sovereign default risk. 

For the same reason in early 2023, the IMF sealed a deal worth of USD3bn, with the government, which unlocked an extra USD14bn sources of financing from multilateral institutions, and GCC sovereign funds, to fill in a hefty portion of the annual foreign exchange gap, albeit  a considerable amount averaging USD6bn per annum is yet to be sourced from portfolio investments.  

With the IMF stepping in, the Egyptian government agreed on a structural reform program that requires a flexible exchange rate regime, where the Egyptian pound is set to trade within daily boundaries against the US dollar, rationalize government spending, especially in projects that require foreign currency; and most importantly the program entails stake-sales in publicly owned assets, paving the way for the private sector to play a bigger role in the economy.

In due course, through its sovereign fund, Egypt planned initial offerings for shares in companies worth about USD5-USD6bn, and expanded the sale of its shares in local banks and government holdings to Gulf investment funds. 

Through the limited period of execution of these reforms, the EGP hit a high of 32 against the greenback, and an inflow of portfolio investments amounting to USD1bn took place, according to the Central Bank of Egypt. 

Simultaneously, Citibank International, cited a possible near end of the devaluation of the Egyptian pound against the US dollar.  Also, in a report to investors, Standard Chartered recommended to buy Egyptian treasury bills, and pointed to the return of portfolio flows to the local debt market in the early days of January, 2023. Likewise, Fitch indicated the ability of the Egyptian banking sector to face the repercussions of the depreciation of the pound, and that the compulsory reserve ratios within Egyptian banks are able to withstand any declines in the value of the pound because they are supported by healthy internal flows of capital.

While things seem to be poised for a recovery, the long term prospects may lack sustainability.  The Egyptian government needs to accelerate its plans to shift gears towards a real operational economy capable of withstanding shocks and dealing with any global challenges. Egypt, however has implicitly held the narrative that the country is ‘too big to fail”. This is largely true to the country’s geopolitical relevance, but even this has its limitations when the price to bail far outweighs the price to fail.

Former President George W. Bush’s administration popularized the “too big to fail” (TBTF) doctrine notably during the 2008 financial crisis. The Bush administration often used the term to describe why it stepped in to bail out some financial companies to avert worldwide economic collapse.

In his book “The Myth of Too Big To Fail” Imad Moosa presented arguments against using public fund to bail out failing financial institutions. He ultimately argued that a failing financial institution should be allowed to fail without fearing an apocalyptic outcome. For countries, the TBTF theory comes under considerable challenge.

In August 1982, Mexico was not able to service its external debt obligations, marking the start of the debt crisis. After years of accumulating external debt, rising world interest rates, the worldwide recession and sudden devaluations of the peso caused the external debt bill to rise sharply, which ultimately caused a default. 

After six years of economic reform in Russia, privatization and macroeconomic stabilization had experienced some limited success. Yet in August 1998, after recording its first year of positive economic growth since the fall of the Soviet Union, Russia was forced to default on its sovereign debt, devalue the ruble, and declare a suspension of payments by commercial banks to foreign creditors.

In Egypt, although the country remains to face a number of challenges, signs remain relatively less worrying than 2022, as global sentiment suggests that leverage will be provided in the short-term at least. Egypt’s diversified economy, size and relative regional clout may very well spare the country the fate of Lebanon. However, if reforms do not happen fast enough, the TBTF shield may become completely depleted.

Hence, in order to avoid an economic fallout scenario a full fledged support to the private sector’s local manufacturing activity and tourism is a must.  Effective policies geared towards competitiveness are mandatory, and tax & export oriented concessions are required to unleash the private sector’s maximum potential and shift Egypt into gear.

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Sanctions and the Confiscation of Russian Property. The First Experience

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After the start of the special military operation in Ukraine, Western countries froze the assets of the Russian public and private sector entities which had been hit by blocking financial sanctions. At the same time, the possibility that these assets could be confiscated and liquidated so that the funds could be transferred to Ukraine was discussed. So far, only Canada has such a legal mechanism. It will also be the first country to implement the idea of confiscation in practice. How does the new mechanism work, what is the essence of the first confiscation, and what consequences can we expect from the new practice in the future?

Loss of control over assets in countries that impose sanctions against certain individuals has long been a common phenomenon. The mechanism of blocking sanctions has been widely used for several decades by US authorities. A similar methodology has been adopted by the EU, Switzerland, Canada, Australia, New Zealand, Japan and some other countries. Russia and China may also resort to these tactics, although Moscow and Beijing rarely use them. In the hands of Western countries, blocking sanctions, however, have become a frequent occurrence. Along with the ban on financial transactions with individuals and legal entities named in the lists of blocked persons, such sanctions also imply the freezing of the assets of persons in the jurisdiction of the initiating countries. In other words, having fallen under blocking sanctions, a person or organisation loses the ability to use their bank accounts, real estate and any other property. Since February 2022, Western countries have blocked more than 1,500 Russian individuals in this way. If you add subsidiary structures to them, their number will be even greater. The volume of the property of these persons frozen abroad is colossal. It includes at least 300 billion dollars in gold and foreign exchange reserves.

This is not counting the assets of high net worth Russian individuals worth $30 billion or more which have been blocked by the G7 countries. However, the freezing of property does not mean its confiscation. Although the blocked person cannot dispose of his assets, it formally remains his property. At some point, the sanctions may be lifted, and access to property restored. In practice, restrictive measures can be in place for years, but theoretically, the possibility of recovering assets still remains.

After the start of the special military operation (SMO), calls began to be heard in Western countries to confiscate frozen property and transfer it to Ukraine. Confiscation mechanisms have existed before. For example, property could be confiscated by a court order as part of the criminal prosecution of violators of the sanctions legislation. However, such mechanisms are clearly not suitable for the mass confiscation of property. Blocking sanctions are a political decision that do not require the level of proof of guilt that is required in the criminal process. To put it bluntly, the hundreds of Russian officials or entrepreneurs put on blocking lists for supporting the SMO did not commit criminal offenses for which their property could be subject to confiscation. The sanctions have spurred the search for such crimes in the form of money laundering or other illegal operations. But the amount of funds raised in this way would be a tiny fraction of the value of the frozen assets. To implement the idea of confiscation of the frozen assets of sanctioned persons and the subsequent transfer of the proceeds for them, Ukraine needed a different mechanism.

Canada was the first country to implement such a mechanism. The 2022 revision of the Special Economic Measures Act gives Canadian authorities the executive power to order the seizure of property located in Canada which is owned by a foreign government or any person or entity from that country, as well as any citizen of the given country who is not a resident of Canada (article 4 (1)). The reason for the application of such measures may be “a gross violation of international peace and security, which has caused or may cause a serious international crisis” (Article 4 (1.1.)). The final decision on confiscation must be made by a judge, to whom a relevant representative of the executive branch sends a corresponding petition (Article 5.3). Furthermore, the executive authorities, at their own discretion, may decide to transfer the proceeds from the confiscated property in favour of a foreign state that has suffered as a result of actions to violate peace and security, in favour of restoring peace and security, as well as in favour of victims of violations of peace and security, or victims of violations of human rights law or anti-corruption laws (art. 5.6).

The first target of the new legal mechanism will be the Canadian asset of Roman Abramovich’s Granite Capital Holding Ltd. The value of the asset, according to a statement by Canadian authorities, is $26 million.

Roman Abramovich is on the Canadian Blocked List, i. e. his property is already frozen, and transactions are prohibited. Now the property of the Russian businessman will be confiscated and, with a high degree of probability, ownership will be transferred to Ukraine. This is a relatively small asset (from the standpoint of state property), but the procedure itself can be worked out. Further confiscations may be more extensive.

The Canadian experience can be copied by other Western countries. In the US, work on such a mechanism was announced back in April 2022. although it has not yet been adopted at the legislative level. In the EU, such a mechanism is also not finally fixed in the regulatory legal acts of the Union, although Art. 15 of Regulation 269/2014 obliges Member States to develop, inter alia, rules on the confiscation of assets obtained as a result of violations of the sanctions regime. The very concept of violations can be interpreted broadly. So, for example, Art. 9 of the said Regulation obliges blocked Russian persons to report to the authorities of the EU countries within six weeks after blocking about their assets. Violation of this requirement can be regarded as a circumvention of blocking sanctions.

There are several consequences of the Canadian authorities’ initiative.

First, it becomes clear that the confiscation rule is not dormant. Its use is possible and is a risk. This is a serious signal to those Russians and Russian companies that have not yet come under sanctions, but own property in the West. It can be not only frozen, but also confiscated. This risk will inevitably be taken into account by investors and owners from other countries, which could potentially be the target of increased Western sanctions in the future. Among them are China, Saudi Arabia, Turkey, and others. It is unlikely that the confiscation of Russian property will lead to an outflow of assets of these countries and their citizens from Canada and other Western jurisdictions. But the signal itself will be taken into account.

Second, the Russian side is very likely to take retaliatory measures. Western companies are rapidly withdrawing their assets from Russia. The representation of Canadian business in the Russian Federation was small even before the start of the operation in Ukraine. If the practice of confiscation becomes widespread, then the Russian side can roll it out in relation against the remaining Western businesses. However, so far, Moscow has been extremely hesitant to freeze Western property. While the US, EU and other Western countries have actively blocked Russians and their assets, Russia has mainly responded with visa sanctions. The confiscation could overwhelm Moscow’s patience and make the retaliatory practice more proportionate.

Finally, the practice of confiscation modifies the very Western idea of sanctions. It currently implies, among other things, that the “behavioural change” of sanctioned persons would result in the lifting of sanctions and the return of property. The freezing mechanism was combined with this idea. However, the confiscation mechanism contradicts it. Sanctions now become exclusively a mechanism for causing damage.

From our partner RIAC

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Pakistan’s geo-economic policy and regional connectivity

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Pakistan has moved its attention to geo-economics ever since the publication of its first National Security Policy. Following a current worldwide trend, this strategy shift from geopolitics to geoeconomics. Geoeconomics is an approach to economics that considers the world economy’s geography and geopolitics. In other words, it is a type of analysis that looks at the relationships between political and economic power that have an impact on global economic activity. In the context of the global economic system, geoeconomics focuses on the interactions between governments and other participants as well as the contribution of geography. With the expansion of global economic integration and the interconnectedness of global markets and trade, geoeconomics has gained importance. Geoeconomic analysis is necessary to comprehend how economic actions made in one country affect other ones. Geoeconomics is frequently used to examine the potential effects of trade agreements, tariff agreements, and other economic policies on the financial condition of various nations throughout the world. This is particularly crucial to take into account when it comes to trade agreements because they frequently involve numerous countries and a range of economic interests.

The Belt and Road Initiative (BRI) of China is a striking illustration of geoeconomics. Beijing’s premier BRI project is the CPEC. With the help of CPEC, China may avoid the trouble zones in the South China Sea and Strait of Malacca and gain dependable access to the Middle East and Africa. This offers China a wealth of energy resources and expanding economic markets. China’s BRI is rerouting economic routes from the West to the East and laying the groundwork for the emergence of a multipolar world order. Pakistan’s crucial contribution to this process makes it possible to view it as the foundation of Beijing’s long-term vision for the world. The China-Pakistan Economic Corridor (CPEC) is more than just a “highway” connecting Xinjiang and the Arabian Sea; it is a collection of regional infrastructure-building initiatives that will help Pakistan position itself as a leader in the fast evolving geopolitical landscape.

The foreign ministers of China, Pakistan, and Afghanistan met in September 2019 and decided that the three nations should improve their mutual connection and push for the CPEC to be extended to Afghanistan. However, Afghanistan’s stability is essential for the successful completion of CPEC and the bigger BRI. The security situation in Afghanistan has not been able to improve under the present administration. Afghanistan still needs to make sure that it won’t be used as a base by militants and that they are excited by China’s involvement in the growth and rehabilitation of Afghanistan. China might support the development of commercial ties between Afghanistan and Pakistan if it works cooperatively with the Taliban and the CPEC is expanded into Afghanistan. The success of such a transaction will probably depend on how stable Afghanistan’s domestic political situation is for international investment to proceed without safety worries. If the security situation in Afghanistan improves, a number of significant regional integration projects could be completed. China, Russia, Iran, and other regional and powerful nations surround Central Asia, which is situated in the centre of Eurasia. Due to their central location in South Asia, South-East Asia, the Middle East, and Europe, the five Central Asian States (CAS) have easy access to a variety of possible commercial partners. Because of its geographic location, the area might serve as a transport route for goods moving between Asia and Europe or the Middle East. Strategically speaking, China, Russia, and the United States all have vested geopolitical interests in Central Asia. Pakistan, which is in South Asia, can benefit from Central Asia’s geopolitical and economic advantages. The trilateral Pakistan-Afghanistan-Uzbekistan railway project, which was just approved, provides Pakistan with strong connections to the rest of the region. Greater regional integration and trade are projected to result from improved trade relations between Central and South Asia. Greater access to Pakistan’s three ports in Gwadar and Karachi would be available to landlocked Uzbekistan. Beyond expanding commercial opportunities with resource-rich Central Asia, Pakistan’s ultimate goal is more than just that. By enabling the flow of power between nations in the region, CASA 1000, a high-voltage electrical transmission line linking four nations in Central and South Asia, will help alleviate energy shortages and promote economic growth. Some Central Asian nations experience summertime electrical surpluses. Pakistan is establishing itself as the meeting place of the geoeconomic interests of the major countries in Central and South Asia through such relationships. In the event that CPEC extends to west Asia and Africa, Pakistan will have a once-in-a-lifetime chance to draw attention around the globe to its crucial geoeconomic policy. Uncertainty in Afghanistan, which serves as a gateway to Central Asia, is the main obstacle to Pakistan’s geoeconomic aspirations. In the near future, other militias will emerge and the nation may likely experience another civil war if the Taliban are unable to securely establish national control. Such a result poses a significant threat to the area. Projects like the TAPI pipeline and CASA 1000 with Central Asian countries, which have already been postponed because to instability in Afghanistan, will continue to be hindered.

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