Asia's Economic History: The Silk Roads

In recent years Asia has been the focus of Western investors looking for a new and different market in which to invest their money. The rise in Asian Investment Funds has been a resulting factor of this. However Asia's economic history is long and interesting with some of the most fascinating ventures taking place thousands of years ago. An important development in Asia's early economic history was the creation and expansion of the Silk Roads (or Silk Routes) that crossed the continent from China to the Mediterranean Sea. So named for the silk that was traded along the routes, the Silk Roads were important both culturally and economically. The route spanned seven thousand miles

The origins of the Silk Roads can be found in the Chinese Han dynasty between 202 BC and 220 AD. At that time there were a number of nomadic Central Asian tribes that needed to trade with China. However, the Chinese viewed these tribes as 'barbaric' tried to limit commercial interactions with them and as a result some of the nomadic tribes took to raiding settlements on the Chinese border. In around 139 BC The Han Government sent General Zhang Qian to try to build up a relationship with the tribes in an attempt to placate them. Unfortunately Qian was captured by Huns and held hostage for ten years.

Eventually Qian managed to escape and headed west across Asia and reached the Da Yuezhi people - to whom he offered the suggestion of an alliance. The Da Yuezhi rejected his proposal and Qian continued on his travels. He arrived back in the capital of Chang'an (now Xian) in 126 BC and his information about where he had travelled greatly interested the Emperor Wudi. Wudi was particularly intrigued by Qian's information about the horses he saw in Dawan, referred to as 'blood sweating' horses, that were stronger and faster than the Chinese horses. The Han dynasty later - partially as a result of the information Qian brought back - embarked on two invasions of the kingdoms to the west of China. The second invasion in 102 BC brought the lands between China and the Ferghana Valley under the control of the Han dynasty. Qian's travels had opened up the Silk Routes and the increase in Chinese territory had brought new markets to trade with and sell goods.

Before the Silk Roads, Chinese silk was generally only traded within China. The opening up of new routes across Central Asia brought with it new markets and new buyers who were very keen for the material. The Romans were particularly enamoured with silk and the Silk Roads gave them the opportunities to acquire it. Though many other things were traded along the routes, silk was the most well-known, and probably most sought-after, product.

When the Han dynasty disintegrated, the lack of a steady government to control the routes had a diminishing effect on trade along the Silk Roads. However the Silk Roads flourished a few centuries later under the Tang dynasty in 618-907 AD who took back control of the area from the Tuque tribe and promoted trade. Since then the use of the Silk Roads has risen and declined. The Mongols in the 13th and 14th century had a particularly positive effect on the Silk Routes as they created a huge empire in Asia and actively encouraged trade across the continent and with the West. A number of toll-gates were destroyed by the Mongolian Empire which made travel along the routes much easier. Marco Polo famously travelled along the Silk Roads at this time.

The Silk Roads were an important factor in the development of Asian civilisations, the routes not only allowed goods to be traded, improving economies, but also allowed new technologies and methods of production as well as religions to 'travel' around the continent. Different cultures could also intermingle - few merchants travelled the whole length of the Silk Roads and their goods often changed hands which meant that a large number of different cultures interacted along the routes. The Silk Roads had a positive effect on the Asian economy as trade opened up and different kingdoms traded with each other where they had not previously. Though the financial interactions between Asia and the West have changed over the centuries, with many investors from the West now choosing to invest in Asian companies, the very basic origins of the transactions can be found in the Silk Roads two thousand years ago.

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