The role of the Belt and Road Initiative: New opportunity for Chinese exporters?

Using Chinese Customs data for the 2007-2018 period, we investigate how Chinese exporters respond to the Belt and Road Initiative (BRI). Based on a difference-in-differences identification strategy, we find that the BRI causes a substantial increase in China's total exports to BRI countries at the HS-8 digit product level, and this export-promoting effect is due to a significant increase in export quantity. We also find that exports increase more to countries along the Maritime Silk Road than those along the Land Silk Road. Moreover, the BRI contributes to optimising the export structure by increasing the proportion of general exports, promoting intermediate exports, improving upstreamness of exports and cutting excess capacity through international market demand. Combined with the existing studies focusing on the impacts on bilateral or global trade, our study helps develop a complete picture of the BRI effects from the perspective of the sponsor country.