Acceleration of fragmentation under the influence of "silk roads"

October 03, 2023

The times when global unions and organizations (UN, WTO) were expected to become unconditional global centres of influence or model global governments have long passed, and today, creation and strengthening of alliances of "friendly" countries is on the agenda. Alliances formed primarily of countries that share common political and humanitarian values, ways and means of development of the global and national economies, adhere to adequate integration. Of course, creation of such alliances and blocs strongly accelerates fragmentation of the single global, and even regional, economic environment. 1

Some of the most "fierce" episodes of fragmentation are observed in Asia and Pacific, whose emerging nations, on the one hand, demonstrate high economic dynamics, but on the other, have not yet decided on their strategic partners and allies, which attracts the attention of the leading countries of the groups already formed. Meanwhile, creation of new alliances and partnerships is taking place at an accelerated pace, and although it may be controversial, it clearly illustrates fragmentation of the world economic environment, and with it, promising political and economic niches.

Although this region is geographically far from Ukraine, and economic ties are rather weak (except for trade with China), the interconnectedness of the modern world means that events and processes that unfold even in remote corners of the planet can be of fundamental importance both for individual countries and the whole world. Last year's tension between China and Taiwan (even the threat of a Chinese invasion) is an eloquent example. The heroic resistance of Ukraine prompted the developed countries to quickly unite to counter aggression, which became a warning of new aggressive intentions against other democracries, and therefore turned away the militaristic threat to Taiwan.

We will take a look at two approaches, within the framework of which a number of characteristic processes are unfolding, the main goal of which is to strengthen the influence of the global powers both through direct bilateral contacts (trade, investments, infrastructure projects, etc.), and through involvement in the formed alliances, blocs and networks of partner countries.

Allied approach. The first approach is ideologically centred around the USA and aimed at institutional strengthening (including of a security nature) - creation of political and economic unions, alliances, blocks of partner countries in this region (Asia-Pacific). Say, the USA together with Australia and Great Britain created the AUKUS alliance 2, and with India, Great Britain and Japan — QUAD 3. In the period of the threat of invasion of Taiwan, interaction, political and military coordination of the USA with Japan and South Korea increased.

A special role is (and will be) played by the Indo-Pacific Economic Framework for Prosperity (IPEF) 4. IPEF was designed to restore the US economic involvement in the region after its withdrawal from the Trans-Pacific Partnership (TPP). Although IPEF initially declared purely economic tasks, the increasingly hot confrontation between the USA and China indicates the further strategic nature of its activities 5. At the same time, the "Partnership for Global Infrastructure and Investments" formed by the G7 with $600 billion worth of funding is in sight, and will act as an alternative to China's "Belt and Road" Initiative. 6

In addition, we should mention Asian-Pacific Economic Cooperation (APEC, the only regional union that includes both the US and China) 7, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the Regional Comprehensive Economic Partnership (RCEP) 8, etc.

Interestingly, the vast majority of developing countries are parties to various agreements, even those whose goals and objectives are contradictory to each other. Say, India is a founding member of the I2U2 grouping (made up of India, Israel, the USA and the UAE), one of the most important tasks of which is to protect the countries of the Indian Ocean from Chinese encroachments. Meanwhile, India is an active member, and the UAE is a new participant of China-dominated BRICS. Therefore, in the political and practical sense, the alliance is rather an "alternative" to strengthening relations between China and Saudi Arabia. 9

It should be noted that the EU countries are rather passive on the regional political stage. Although the developed countries of Europe also have significant interests there, they are not yet recognized as influential actors. To make up for the "lag" in the integration processes, France, Germany, and the Netherlands intensified efforts for a more formal, structural presence in the region, the platform for which can be QUAD Plus 10 that clearly combines economic and security components.

One of the mechanisms actively promoted by the Europeans is the Trade and Technology Council (TTC) created by the EU (in partnership with the USA and India). The EU-initiated digital partnership with Japan, South Korea, and Singapore, International Solar Alliance (ISA; the framework agreement has already been ratified by 92 countries) looks promising, agreements were signed on combating climate change, etc. 11 However, this will be possible only with the support of the existing alliances of democratic countries.

Project approach. China chose another strategic way of strengthening its position and dominance in the region — through a number of project initiatives to strengthen technological leadership and draw emerging countries into transnational networks created and implemented by China. 12 It should be noted that such projects are formed within the framework of the "Silk Road" ideology, mainly focused on the emerging countries of the region, and their attractive side is the bilaterality and relative cheapness of the countries’ participation in such projects (China is ready to cover the lion's share of the cost of their creation).

Noteworthy, on the one hand, the involvement of emerging countries in BRICS, where China is sreadily strengthening its leadership, grows. On the other, the range of Chinese initiatives is expanding, as a tool for strengthening integration and infrastructure processes led by China, and the conditions for joining such projects look very attractive.

However, in reality, quite different goals are often pursued, rather aimed at strengthening the country's "bonds" with China. Say, in most cases, investments take the form of loans, the use of which is also tied to Chinese corporations, heavily criticized for the non-transparency (in many cases) of their activities. Therefore, projects with little control on the part of national governments (but bound by state obligations) turn "debt trap diplomacy" 13, resulting in the loss of strategic facilities. 14

Among the best known projects launched in recent years, the Digital Silk Road (DSR), which was announced in 2015 15, stands out as a logical continuation of the Belt and Road Initiative (BRI) infrastructure project. While the first two components of the BRI — the Silk Road Economic Belt and the Maritime Silk Road — covered (physical) infrastructure projects (including transcontinental energy networks), economic networks and corridors, etc., the DSR is aimed at information expansion and digital involvement in joint information and technological networks, primarily in the emerging countries of the region. 16

The project relies on strong involvement of Chinese state corporations and banks, which makes it possible for partner countries to obtain inexpensive contracts and rapidly built digital infrastructure facilities. To date, 27 countries of the Indo-Pacific region have signed bilateral agreements with China on digital cooperation within the framework of DSR. Instead, China, promoting the activity of Chinese hi-tech corporations, gains access to large pools of data and captures new markets of the recipient countries 17. However, the adequacy of data protection is already subject to heavy trials (Box "What's wrong with video surveillance?").


Video surveillance is an important element of SDR. Today, China is the largest producer of video surveillance cameras, or CCTV cameras 18. These cameras were to become one of the features of the so-called Chinese "smart cities". However, when such cameras began to be installed abroad, the problems surrounding surveillance only increased, especially as many of them were suspected of improper functioning in buildings and facilities of government and corporate structures.

While access to communication channels should prevent uncontrolled access from outside, it turned out that developers and manufacturers easily violate such restrictions, which effectively makes it impossible to protect personal, state and corporate secrets.

In many developed countries, Chinese-made cameras are being phased out and replaced with more expensive cameras from other manufacturers. Some countries, such as the USA in 2022, even banned the sale of such cameras on the territory of the country. 19

Of course, everything is just beginning with digitization. In order to expand and speed up its influence in the region, China has intensified the development of a number of global leadership initiatives, both humanitarian and civilizational, but essentially security-related. It should be noted that the economic efficiency of many projects does not have a noticeable impact on their implementation. The involvement of (emerging) countries in China's economic (and political) orbit is more important.

So, on the one hand, in addition to the above-mentioned Digital Silk Road project, platforms are being created that have received eloquent names: Green Silk Road 20, Health Silk Road 21, Polar Silk Road 22, etc., which (allegedly) should contribute to global sustainable economic and social development, while their specific focus speaks for itself. Even if the humanitarian content is available, in reality emerging countries will be actively involved in these and other "silk roads", which will contribute to fragmentation.

On the other hand, China put forward a number of initiatives that should be aimed at strengthening (as China sees it) the global security architecture. Moreover, China has already adjusted its own initiatives under the influence of the war in Ukraine - the Global Development Initiative (GDI) 23, the Global Security Initiative (GSI) 24 and the Global Civilization Initiative (GCI) 25, the main focus of which is claimed to be the alternative (to the liberal) world and regional economic (and political) system, while their practical implementation arouses even more concern, regarding the proposed mechanisms of the new civilization system 26, and their true goal may be to support and assist with the formation of "alternative" security alliances, certainly led by China.

Precautions for Ukraine. Despite the significant political and diplomatic efforts China used in previous years to promote its projects/initiatives in various countries, we dare say that the intended results have not always been achieved. Moreover, significant disappointment with the efficiency of Chinese projects is observed in European countries, especially in Central and Eastern Europe (CEE), which were involved in a Silk Road component - the so-called "16+1".

To some extent, the reason is that, on the one hand, the Chinese practice of implementing infrastructure projects for the CEE countries was not very acceptable, including because it did not sufficiently take into account the needs of local governments. On the other hand, projects in the CEE countries were largely seen not as national projects but primarily as a tool to get Chinese business into the infrastructural environment of the EU in general, which could not satisfy the CEE countries. As a result, the efficiency of implementation of infrastructure projects within the framework of the "16+1" association met considerable criticism and shattered the interest of Europeans in their continuation. 27

This directly concerns Ukraine. While democratic countries do not hesitate to help Ukraine repel Russian aggression, China has taken a "special" position. In particular, it dissociated itself from the Western sanctions for the invasion, allowed grey (via third countries) supply of dual-use technologies to Russia, including semiconductors 28 that can be used in military equipment.

For Ukraine, this should certainly serve as a good warning in the near future, since, on the one hand, Ukraine already has some experience with China's security initiatives, and the "quality" of Chinese initiatives caused doubts in Ukraine. We are talking about the peace plan for Ukraine, presented by the Chinese leadership in the spring of 2023, which turned out to be unacceptable for our country and hardly took into account Ukraine’s interests.

It should be noted that Chinese initiatives often exploit the paradigm of transformations in order to achieve sustainable long-term development, like "peace for the sake of development" 29, while missing the goals and ways of making peace, as well as the measure of responsibility of the parties to the conflict. Therefore, Ukraine should analyze the initiatives from different sources, the number of which will increase as the confidence of international investors in the victory of Ukraine grows stronger.

On the other hand, there is no doubt that China would like to participate in the post-war reconstruction of Ukraine. And in this context, fragmentation can be extremely useful for Ukraine, as it clearly places emphasis on goals, priorities, ways of achievement, reliable partners — and those looking for quick benefits. It also allows taking into account the geopolitical and geoeconomic interests of Ukraine's strategic partners in the conditions of polarization of the world community. 30

[1 Political, Economic, and Structural Consequences Of Russian Aggression for Ukraine and the International Community. Challenges of Ukraine’s Economic Recovery in the Post-war Period in View Of European Integration Priorities. —

[2] AUKUS: The Trilateral Security Partnership Between Australia, U.K. and U.S. —

[3] QUAD. —

[4] FACT SHEET: In Asia, President Biden and a Dozen Indo-Pacific Partners Launch the Indo-Pacific Economic Framework for Prosperity. —

[5] Важливим для США є оголошення про Угоду про ланцюги поставок (Supply Chain Agreement) в рамках IPEF. Група країн-учасників поки не оголосила про будь-які офіційні торговельні зобов'язання в рамках цієї угоди, однак серед партнерів є очікування стосовно посилення співпраці та моніторингу ланцюгів поставок, уникнення їх порушення, а з тим — мінімізації залежності від головного економічного гравця регіону, Китаю. — Саміт БРІКС — час для консолідації чи конфронтації?,

[6] Patrick S., Klein E. United Nations, Divided World. —

[7] The EU Indo-Pacific Bid Sailing Through Economic and Security Competition. / Edited by F.Fasulo. —

[8] У двох останніх США не є безпосереднім учасником

[9] What You Need to Know About the I2U2. —

[10] Europe and the Indo-Pacific: Partners facing similar challenges,

[11] The EU Indo-Pacific Bid Sailing Through Economic and Security Competition. / Edited by F.Fasulo. —

[12] Звичайно, проектний підхід не є вичерпним. Досить згадати про заснований Китаєм Азійський банк інфраструктурних інвестицій (Asian Infrastructure Investment Bank — AIIB), який вже займає вагоме місце у світовому політичного та економічному середовищі. — Baviera А. China’s Strategic Foreign Initiatives Under Xi Jinping,

[13] Osman R. Bye Bye BRI? Why 3 New Initiatives Will Shape the Next 10 Years of China’s Global Outreach. —

[14] «Нові шовкові шляхи» Китаю: десять років потому. —міжнародні-новини/20230911-нові-шовкові-шляхи-китаю-десять-років-потому

[15] Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-Century Maritime Silk Road. —

[16] Patil S., et al. China’s expanding tech lead through Digital Silk Road. —

[17] Patil S., et al. China’s expanding tech lead through Digital Silk Road.

[18] CCTV (Closed-circuit television camera) —

[19] Woollacott E. U.S. Bans Chinese Telecom Kit Over National Security Concerns. —

[20] Xiao A., at al. Evolution of China’s Belt and Road Initiative: Green Silk Road. —

[21] Xiao A., at al. Evolution of China’s Belt and Road Initiative: Health Silk Road. —

[22] Xiao A., at al. Evolution of China’s Belt and Road Initiative: Polar Silk Road. —

[23] China’s Global Development Initiative: soft power play or serious commitment? —

[24] China’s Global Security Initiative. —

[25] Ellis R. The Trouble With China’s Global Civilization Initiative. —

[26] Osman R. Bye Bye BRI? Why 3 New Initiatives Will Shape the Next 10 Years of China’s Global Outreach. —

[27] Kavalski E. The Unintended Effects of China’s Silk Roads in Central and Eastern Europe. —

[28] Зокрема, Китай подвоїв експорт напівпровідників до Росії протягом 2022р.

[29] Єфремов д. Перемога України? Навіщо Китай відправив свого представника на «мирні переговори». —

[30] Political, Economic, and Structural Consequences Of Russian Aggression for Ukraine and the International Community. Challenges of Ukraine’s Economic Recovery in the Post-war Period in View Of European Integration Priorities. —

Full Ukrainian version

Vasyl Yurchyshyn

Director, Economic Programmes

Born in 1955 in Kamyanets-Podilskyi.


T. Shevchenko Kyiv State University, Department of Cybernetics (1977).

Institute of Public Administration and Local Government at the Cabinet of Ministers of Ukraine (1994).

Professor in Public Administration. Author of nearly 100 scientific works.


In 1977–1993, worked at the Kyiv University as an engineer, research fellow and senior research fellow;

1994–1999 — head economic researcher at the International Centre for Policy Studies, Fund for Banking and Finance Development;

1999–2004 — Assistant Professor, Department of Economic Policy of the Ukrainian (currently, National) Academy of Public Administration, office of the President of Ukraine;

1999–2004 — Research Director at the Agency of Humanitarian Technologies, later — Agency for Social Analysis;

2002–2003 — advisor to the Minister of Economy of Ukraine;

since April, 2004 — Professor, Department of Economic Policy of the National Academy of Public Administration, office of the President of Ukraine;

since June, 2005 — Economic Programmes Director at Razumkov Centre.

(044) 201-11-90