The New Silk Road

Yiwu is a small city by Chinese standards. It has fewer than a million people and lies in the shadow of its wealthy neighbors, Shanghai and Wenzhou. But Yiwu is special. It claims the world’s largest wholesale market for consumer goods and is a Mecca for foreign traders. I had heard about the market from a Syrian trader, having asked him if there were many Arab traders in the city. He laughed and replied, “Not many Arab traders. All Arab traders are in Yiwu.” Intrigued, I decided to find out for myself. It was winter when I arrived and the city was gripped by a chill wind. I hustled out of the small airport into the warmth of a taxi. We sped along a newly built freeway to the city’s outskirts. From the outside, the exhibition hall looks like a large American mall. But, from the inside, it looks like a riotous collision of every retail shop, city market, and roadside stall in the world.

In March 1937, an American geologist, Max Steinke, made a fateful trip across Saudi Arabia. He was part of an exploratory team working for the Standard Oil Company of California. Steinke and his colleagues had established a base camp in the eastern coastal city of Dhahran. Their American wives later arrived on the boat from Bombay. It was a harsh assignment. The team lived in two-bedroom portables. There wasn’t a tree in sight. Summer temperatures reached upward of 130 degrees. Two Chinese cooks, Chow Lee and Frank Dang, served up a steady diet of fried noodles and bread. But for the geologists, at least, there was the reward of exploring the vast and still untamed Arabian Peninsula. And so in March that year the exploratory team set off in a convoy of two sedans and three pickups. An American journalist, Wallace Stegner, later recorded the events.1

In July 2005, the currency trading desks burst into action across the world. The euro had suddenly strengthened against the dollar. It wasn’t clear why. But the traders scrambled to dump their long dollar positions regardless. This wasn’t the time to stand in the way of the market. The traders had to pay widening spreads as the market gapped higher. The foreign currency market is the largest of the world’s financial markets, trading over $3 trillion a day.1 A one-point miss on a €100 million trade would cost a trader $10,000. A ten-point miss would cost $1000. A large enough move might wipe out weeks of profit. Tempers flared and keyboards were smacked hard in frustration. Losing money was bad enough, but losing money without knowing why was gutting.

The Silk Road was once the heart of global commerce, a land bridge stretching thousands of miles, connecting China with the Middle East. A caravan might begin in Changan, the Chinese imperial city better known today as Xian, famous for its collection of terracotta warriors. It was here that jade, silk, and musk were collected from around the country before they started their journey west. The caravans traveled to the last fortified Chinese barrier at Dunhuang before attempting to skirt the Tarim Basin and its deadly Taklamakan Desert. There were many routes, but all were difficult and the caravans faced problems with food, water, sandstorms, and marauders. After passing through the fortified cities of Samarkand and Bukhara, the caravans traveled across the Persian Plateau before finally connecting up with the Great Desert Route, which linked the cities of ancient Mesopotamia to the Mediterranean Sea. The Syrian city of Damascus lay at the end of the route, a few days ride from the trading ports of Beirut, Sidon, and Tripoli.1

When former Syrian Vice President Abdul Halim Khaddam, traveling to China in 2001, stopped in the southern city of Shenzhen, what he saw amazed him. The city is a pinup for China’s remarkable economic success. The Chinese government granted Shenzhen special economic privileges in the early 1980s, permitting it to trade freely with the rest of the world. The results were explosive. Hong Kong investors poured billions of dollars into the city, relocating their factories across the border to take advantage of the cheaper labor costs. From a sleepy fishing village, Shenzhen grew into a mighty metropolis of more than eight million people, attracting migrants from all over the country. Khaddam reportedly praised the wisdom of former paramount leader Deng Xiaoping,1 who was largely responsible for the economic reforms that had benefited Shenzhen. It is not hard to imagine the Syrian Vice President hoping to repeat the same miracle in Syria.

Al Jazeera ’s Beijing office occupies the upper floor of an apartment block near Tiananmen Square. I arranged to meet the bureau chief, Ezzat Shahrour, one winter and had rashly decided to walk from my hotel, along Jianguomenwai Dajie. The morning traffic had already turned the overnight snowfall into a dark slush and my face was bitterly cold by the time I arrived at the apartment block. Shahrour was from the northern Syrian city of Aleppo, which was obvious the moment his secretary opened the door for me. His office was crammed with the furniture Aleppo is famous for. It is beautiful, made of handcrafted rose and walnut wood, and inlaid with mother of pearl. I have similar pieces in my own apartment. It wasn’t hard to imagine that such furniture had also found its way to China centuries earlier along the Silk Road.

My hotel concierge put me in touch with Ma Guoming. I had earlier tried contacting a number of translation companies, but it was peak season in Yiwu city. Their Arabic translators were busy. I thought the hotel concierge might be able to help, as the hotel was full of foreign traders. He could, but said to expect a fee of 500 yuan for the day. I agreed. So he made a few calls and finally found a translator for me. Together we caught a taxi to meet Ma. It was cold and, as we pulled up the curbside, Ma was breathing steam, his hands stuffed deep into his jacket pockets. He opened the passenger door and climbed quickly in. I introduced myself, and we chatted a short while in Arabic. Then I asked a price. “Two hundred yuan ($30). For the day,” he said, replying in Chinese. There was complete silence in the front seat. Finally the concierge turned to me. “Good price,” he said as a sickly grin spread across his face.

The events related in this book are the early tremors of a historic global rebalancing. However, it is not governments and multinational corporations but rather thousands of individual Arab and Chinese traders that represent the first tremors of change. It is a change occurring at the grassroots level. The distinction is important. Who notices the activities of an Arab trader in Yiwu or a Chinese trader in Damascus? It isn’t obvious how their activities have a meaningful impact on life in America and Europe. But these traders are symbolic of more powerful tides that are reshaping the global economy. The challenge is in trying to identify the forces at work as the center of gravity starts to shift away from the West toward the East.