5 reasons why 2026 is the New Silk Road’s pivotal year

The Belt and Road Initiative (BRI) has entered its 13th year. Often called the “New Silk Road", it now spans more than 150 countries and looks quite different from its initial ideas. According to the latest China BRI Investment Report 2025 by the Griffith Asia Institute and the Green Finance & Development Center (GFDC), total BRI engagement reached a record US$213.5 billion in 2025, the highest since the initiative's inception.

The shift is structural. China is moving away from large, capital intensive infrastructure toward “small and beautiful” (“小而美”) projects, a direction first outlined by President Xi Jinping in 2021. This mirrors China’s domestic focus on high-quality development under its 15th Five-Year Plan starting from this year.

As China’s domestic priorities and overseas engagement align more closely, the BRI is evolving. It is no longer just an infrastructure push. It is moving towards a more sustainable, technology-driven trade and investment ecosystem. Here are five reasons why we are at the start of “Phase 2” of the New Silk Road.

1. The Green Silk Road reaches industrial scale

The "Green Silk Road" has moved from concept to reality. Since its initiation in 2016, green BRI investment has grown rapidly. In 2025 alone, green energy engagement reached a record US$18.3 billion, nearly 9% of total BRI engagement. Projects span wind, solar, and waste-to-energy.

Investment is also flowing into green manufacturing and transition fuels such as hydrogen. Notable examples include a €7.6 billion green hydrogen development in Nigeria involving LONGi, and a US$2.1 billion investment in a lithium battery factory in Portugal by China Aviation Lithium Battery (CALB).

Environmental and social standards are gaining importance alongside capital flows. The Green Investment Principles (GIP), launched in 2018, has become a key framework for BRI projects. The initiative now includes 49 member institutions across 17 countries, signaling broader international buy-in.

2. Moving beyond concrete and steel

Traditional infrastructure still matters. Construction contracts made up 60% or US$128.4 billion of BRI engagement in 2025. Average deal size also increased, reaching US$964 million, a significant jump from the 2024 level of US$496 million.

At the same time, investment activity is expanding. The remaining 40% of BRI engagement comes from equity and other investments, largely led by private companies. Large investment deals grew in size, with average transactions above US$100 million rising to US$939 million in 2025.

New thematic pillars are also emerging. In addition to green investments, the “Health Silk Road” and “Digital Silk Road” are taking shape. In January 2026, the China-ASEAN Regional Medical Products Trading Platform concluded its first major 2026 transaction—a RMB10 million deal for innovative pharmaceuticals. Similar hubs in Xinjiang and Egypt are building new channels for medical cooperation.

3. Deeper and more diverse value chain engagement

Trade and resource flows have always been central to the Silk Road. Yet BRI critics often focus narrowly on single sectors or commodities. The reality on the ground is far more diverse.

In 2025, metals and mining sector engagement reached a record US$32.6 billion. Importantly, investment is shifting beyond extraction toward local processing. Kazakhstan, for instance, is emerging as a minerals investment hub, supported by projects such as a US$12 billion aluminum complex by China’s private East Hope Group.

Technology and manufacturing are also growing fast. Engagement in these sectors reached nearly US$28.7 billion in 2025, covering data centres, EV batteries, and hydrogen. The BRI is increasingly about building full value chains, not just moving raw materials.

4. Scaling sustainable finance and tackling debt sustainability

BRI finance is entering a more mature phase. Since 2019, Chinese and international partners have worked through the BRI International Green Development Coalition (BRIGC) to strengthen environmental standards of BRI projects. Its Green Development Guidance, first published in 2020, introduced a traffic light system (‘red’, 'yellow’ and ‘green’) to assess project impact and improve environmental risk management.

China’s new ISSB-aligned corporate climate reporting standard will further align outbound investment with global capital market expectations. This should make BRI projects more transparent and more attractive to international investors.

China’s deep green finance expertise also matters. Chinese banks are experienced in issuing green bonds and other sustainable instruments. These tools could play a larger role in future BRI financing. Researchers are also exploring options such as debt‑for‑nature swaps to help address debt sustainability challenges in some partner countries.

5. Putting people-to-people ties at the centre

2026 marks 70 years of China-Africa diplomatic relation, as well as bilateral relations with many African nations such as Egypt, the second largest BRI recipient in 2025 (US$10.2 billion). The launch of the China-Africa Year of People-to-People Exchanges in January 2026 signals a renewed focus on cultural, educational, and youth engagement.

Closer to home, China will host APEC 2026 under the theme “Building an Asia-Pacific Community to Prosper Together”. BRI investment is increasingly concentrated in Central Asia and Southeast Asia, which received US$28.3 billion and US$20.9 billion respectively in 2025.

These exchanges reflect China’s broader vision of a “community with a shared future for mankind”. In practice, this goes beyond culture. It includes cooperation in education, research, and high‑tech innovation.

A growing web of connections

The New Silk Road is no longer a single, centrally managed project. It has become a decentralized global network shaped by local priorities and partnerships. Many BRI countries are now driving their own development agendas while drawing on China’s capital, technology, and markets.

Looking ahead, the most successful BRI projects will sit at the intersection of sustainability, local value creation, and high-tech adoption. These themes will define the next chapter of the New Silk Road and make 2026 a year to watch.