Neo-Mercantilism and Energy Politics: The Influence of China's AIIB and BRI in Central Asia

This study examines how China's monetary dilemma, driven by the contradiction between its managed currency regime and reliance on dollar-priced energy imports, has shaped its regional economic strategy in Central Asia. I argue that this constraint has catalyzed a neo-mercantilist project, executed through the BRI and the AIIB, designed to entrench Chinese energy access through physical infrastructure and institutional alignment. Infrastructural lock-in, energy capture, and the consolidation of bilateral Renminbi (RMB)-denominated commodity exchanges emerge as long-term strategic consolidation. To test this logic, I estimate post-treatment changes in the value and share of energy exports using a staggered Difference-in-Differences (DiD) design applied to UN Comtrade data from 2013 to 2023, controlling for oil prices, gas prices, and the pandemic's effects. In the Central Asian sample (Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan), participation in the BRI and AIIB results in a statistically significant increase in total FOB (Free on Board) export value, but no measurable rise in the percentage share of energy exports to China. These results reflect a long-term strategy of infrastructural entrenchment without immediate directional capture.