Understanding the Energy-Water-Land Flow Nexus in Transnational Trade of the Belt and Road Countries

Economic globalization and population growth have greatly challenged energy, water and land resources to meet demand at national and supra-national level. A growing share of this demand is met through trade.  The Belt and Road, a major global initiative of China, with trade as one of its core fields is of particular importance due to greater potential of economic growth, substantial population size and varying degree of resource availability. The initiative reflects a new phase of globalization yet resources management with nexus thinking has received little attention. The increasing economic interdependence of national economies have contributed to rise in production and trade of goods and services, these activities require the input of energy-water-land and generate disturbances in the environment. The multi-regional input-output approach is utilized, to assess resources use by production as well as consumption (for the year 2010). A nexus strength indicator was developed to show the simultaneous use of multiple resources in economic system, conceived as resource nexus. The ternary diagrams were used for screening resources combinations along with concentration.Results revealed that China has strong nexus strength that indicates large usage of the three resources together. Besides China, the East European countries were also positioned mostly at the center of ternary plot suggesting somewhat equal contributions of energy, water and land to the resource nexus. On the contrary, countries that appeared at the margins of the plot indicated one or two stronger nexus components in the three resources system. For instance, Russia largely used land, South Korea was entirely driven by energy while India mostly used water in the ternary mix. Due to differences in industrial structure, trade policy priorities and technology use, the resource nexus matters are not the same among countries. The nexus strength indicator established that strong nexus caused by intensive use of energy, water and land results in low efficiency, which threatens resource security. With this approach, it is possible to evaluate the characteristics and behavior of economies relating to energy, water and land resource flows. As such the study is intended to serve as a reference work for policymakers and researchers primarily those working in Belt and Road countries that can build on to conduct more detailed nexus assessments in future to achieve sustainability.