Facilitating Economic Growth in Eurasia: China's Great Western Development Plan and the Central Asian Economies Author: Bradley Jensen Murg,  Department of Political Science, University of Washington

Abstract: Since its inauguration by President Jiang Zemin in 2000, the Chinese government’s Great Western Development Plan has already pumped billions of dollars in investment into China’s ten westernmost provinces.  A key element of this initiative has been increasing the openness of this region towards neighboring states, the facilitation of cross-border trade, and the provision of new infrastructure.  This paper attempts to determine the implications of the program for the economies of the Central Asian states, specifically – Kazakhstan, Uzbekistan, Kyrgyzstan, and Tajikistan.  Beginning with an overview of the development of Sino-Central Asian economic relations and subsequently building on recent work by Feenstra and Hamilton on the impact of the demand side of the economy on national development and that of Sachs and Demurger on regional growth poles and the role of geography, I look at the position China has played and will play in shaping the trajectories of the economies of these states.  Specifically, this paper analyzes: the germane components of the Western Development Plan; the complementarities between the economy of China and those of the various Central Asian states; the impact of a steadily increasing Chinese consumer class; specific policy measures by the Chinese government to facilitate regional economic integration; the growth of Chinese investment and joint ventures in the region; and the potential economic role of the Shanghai Cooperation Organization.