In recent years, Central Asian countries have generally adopted the digital economy as a new impetus and new direction for building a modern economic system and promoting the high-quality development of their economies, and have been actively conducting relevant international cooperation. Since Chinese President Xi Jinping advocated the joint construction of the Digital Silk Road at the first Belt and Road Forum for International Cooperation, Central Asian countries have responded positively. Cooperation in the digital economy is likely to become the most promising new area for China and Central Asian countries to jointly build the Silk Road Economic Belt and improve the level of regional economic development. Therefore, in order to better promote bilateral cooperation, it is necessary to carry out an in-depth discussion on the foundations of cooperation as well as challenges which China and the Central Asian countries face when jointly building the Digital Silk Road.

Digital Economy Development in Central Asian Countries

Digital economy refers to a series of economic activities that use digitized knowledge and information as key production factors, modern information networks as major carriers, and effective use of information and communication technologies as important drivers of efficiency improvement and economic structure optimization. The modern information technology revolution represented by computers, networks, and communications has given birth to the digital economy. The essence of digital economy lies in infbrmationization. The main entities of the digital economy include individuals, enterprises and governments, which can best reflect the requirements of information technology innovation, business model innovation, and institutional innovation. Among them, e-commerce and e-government are the most important components of the digital economy and the most important driving force behind the development of a digital economy. The digital economy also includes the digital infrastructure for cloud computing and big data, as well as digital finance and other new models and new business forms based on data, algorithms, and credit. A high internet penetration rate is a necessary condition and foundation for the development of the digital economy. As a combination of the development of the digital economy and the Belt and Road Initiative, the Digital Silk Road is where digital technology supports the Belt and Road Initiative. Relying on internet technology and cross-border e-commerce platforms to promote digital infrastructure, smart payment and logistics systems, the Digital Silk Road aims to become a new engine of the Belt and Road international cooperation, boosting the establishment of cooperation mechanisms.

Since the arrival of the 21st century, the world has entered a period of economic development led by the information industry. In order to better meet the growing information needs of their citizens and to integrate into the global information society, Central Asian countries have begun to develop information and communication facilities in phases. In a growing number of areas, those countries use modern information and communication technology and computer technology to lay the foundation for the initial development of the digital economy; In recent years, in order to enhance their levels of economic modernization and conform to the trend of digital development of the world economy, various Central Asian countries have adopted multiple measures to promote a comprehensive and sustainable development of the digital economy;

Digital economy strategies of Central Asian countries

Kazakhstan adopted the Digital Kazakhstan State Program in December 2017, and unveiled a revision and supplementary resolution on the program in December 2019. The plan is due to be implemented from 2018 to 2022, with the medium-term goal of accelerating the economic development of Kazakhstan and improving the quality of peoples livelihood through the use of digital technology. The long-term goal is to create conditions for Kazakhstans economy to embark on an innovative development path. There are 17 tasks to be implemented, including: industrial and power digitization, transportation and logistics digitization, agricultural digitization, development of e-commerce and e-government, development of financial technology and non-cash payment, building smart cities, expanding the coverage of communication networks and communication technology infrastructure, ensuring the security of information and communication technologies, improving the residents education level and digital literacy, and supporting the establishment of innovative development platforms. The ultimate goal is to raise Kazakhstans ranking in the Information and Communication Technology Development Index from the 52nd in 2016 to 30th by 2022, 25th by 2025, and 15th by 2050.

Uzbekistan issued a Presidential Decree on the measures for the development of the digital economy in July 2018. In November 2019, a draft for discussion and an implementation roadmap of the Digital Uzbekistan 2030 National Strategic Concept were released. The country planned to formulate the National Digital Strategy 2030 by October 1, 2020, and determine short-, medium- and long-term priorities as well as digital development goals before 2030. According to the draft, the main objectives of Uzbekistans digital strategy include: ensuring the systematic development of the digital economy, e-government, information and communications technology, and innovative technologies; increasing the digital literacy rate of residents; training high-quality digital talent; promoting remote working methods; expanding telecommunications infrastructure and data processing centers and implementing innovative projects; improving laws and regulations related to the digital economy; raising data collection and processing efficiency; adopting modern IT projects and corporate financing forms; increasing the transparency and accessibility of government electronic orders; establishing risk funds and technology parks to attract foreign investment and promote export-oriented product research and development; and strengthening international cooperation in the field of digital development. Uzbekistan expects that by 2030 it will be able to provide high-quality, secure, cost-efficient, and intelligent high-speed internet and mobile communications, establish a stable and competitive communications and telecommunications market, and reduce the digital divide between urban and rural areas.

In November 2018, the President of Turkmenistan approved the Turkmenistan Digital Economy Development Concept 2019-2025, which will be implemented in three phases: 2019, 2020-2023, and 2024-20257 The purpose is to create favorable institutional and legal conditions for the effective development of the digital economy and improve the digital ecological environment with the participation of the state, enterprises and citizens. The main tasks include: adopting digital and other innovative technologies in all economic sectors across the country; completing the transition to electronic documents and electronic identification systems; establishing a competitive digital economy; establishing a coordinated electronics industry; and eliminating the digital divide between urban and rural areas. Turkmenistans economic digitalization mainly includes two directions: one is to digitalize work processes; the other is to ensure the digital transition of state institutions, enterprises, and other non-state organizations. The main goal is to improve the efficiency of scientific, technological, and innovative activities through digital applications, strengthen international cooperation in the digital field, ensure closer interconnection between science, education, and production, and provide technological and intellectual support for the digital transformation of the economy;

Kyrgyzstan passed the resolution of digital transformation concept “Digital Kyrgyzstan 2019-2023″ in December 2018, and unveiled the roadmap in February 2019, hoping to accelerate the countrys digital transformation and socio-economic development. The foundation of Kyrgyzstans digital transformation includes developing digital skills, improving the legal and regulatory framework, establishing digital infrastructure and platforms, developing a digitalized country, and building a digital economy and management system.¹ Kyrgyzstan intends to develop three key areas. First, the digital transformation of commercial production, introducing innovative technologies into the financial and banking industries, cultivating qualified professionals to improve the efficiency and competitiveness of domestic companies, and developing digital infrastructure and digital platforms in top economic sectors. The second aspect is to take advantage of the digital economy development strategies of partner countries; that is, utilizing the Eurasian Economic Unions 2025 Digital Agenda to participate in the joint construction of the Digital Silk Road, and supporting other international initiatives for digital infrastructure development in relevant regions. The third aspect is to reduce the obstacles to the research and development of digital technology.

In January 2019, the Tajikistan government passed a resolution on the results of Tajikistan s socio-economic development in 2018 and its tasks in 2019, calling for the development of a national digital economy concept and the introduction of digital technologies to socio-economic sectors. In February, a managerial and technical working group was established in accordance with the order of the Ministry of Economic Development and Trade to formulate Tajikistan’s digital economy concept. On December 30, the President of Tajikistan approved the Tajikistan Digital Economy Concept. This plan, divided into three stages of 2020-2025, 2026-2030 and 2031-2040, is to be implemented within the framework of the Digital Central Asia-South Asia project (Digital CASA).⁴ Tajikistan intends to develop the digital economy in the following main areas: developing digital infrastructure; focusing on providing broadband access services for all people at an affordable price; making a transition to a digital government; digitalization of key industries; protecting information and cyberspace security; developing human capital; and establishing an innovation ecosystem.

Rapid growth of e-commerce

First, e-commerce has been growing rapidly across Central Asia. For example, Kazakhstan’s annual growth rate of e-commerce was 26 percent from 2013 to 2014, and the figure has accelerated to 30 percent on average since 2015. In 2018, the number of online shoppers in Kazakhstan reached more than 2.3 million, and the transaction volume of online shopping reached 259.5 billion Kazakhstani tenge （about US$753 million）, up 50 percent over the previous year. There are more than 1,700 independent online stores and about 20 e-commerce platforms providing sales services for more than 1 million small- and medium-sized enterprises.

Second, many policies related to e-commerce have been introduced. Kazakhstans E-Commerce Development Roadmap before 2025 was approved in 2019, and it clarified three main development directions: expanding the scale of e-commerce exports, attracting enterprises to participate in e-commerce development and infrastructure construction, and strengthening consumer rights protection. The government of Kazakhstan has also formulated tax incentives for e-commerce practitioners, with the guarantee of law. Uzbekistan adopted the Concept of Developing E-Commerce in Uzbekistan 2016-2018 as early as in December 2015. In 2018, Uzbekistan issued a presidential decree on measures to accelerate e-commerce development and determined the countrys e-commerce development plan for 2018-2021, which involves six major areas: improving the legal, regulatory, and management frameworks of e-commerce development; creating a favorable environment for e-commerce; strengthening export capabilities and international e-commerce cooperation; developing e-commerce logistics infrastructure; cultivating human resources in the field of e-commerce; and raising public and business awareness of e-commerce.

Third, emphasis has been placed on the construction of logistics platforms. For example, Kazakhstan has significantly improved its logistics efficiency by improving its postal services. Currently, about 120 companies in Uzbekistan are engaged in international express delivery business, and the countrys e-commerce services have witnessed great progress. Kyrgyzstan is formulating plans for storage and processing facilities of agricultural products according to the supply of commodities, and attracting investors to develop a system of agricultural trade and logistics centers.

Improving e-government capabilities

First, the range of e-government applicability in Central Asian countries is gradually expanding. The e-government of those countries have now covered administrative agencies at all levels of government as well as national legislative, judicial, and other public organizations. The e-government functions include not only electronic and networked office on intranets between government departments, but also extranet-based information sharing, real-time communication and collaborative work, and two-way internet-based information exchange between government agencies and various public entities. Because of the prevalence of e-government among administrative agencies, there have been considerable improvements in the administrative efficiency and transparency of governments in Central Asia. A case in point is Kazakhstan. It provided public services on portal websites about 40 million times in 2016; as of July 2017, Kazakhstan had offered more than 740 electronic services and 83 mobile services. The government portals of Kazakhstan, Uzbekistan, and Kyrgyzstan provide their citizens with opportunities to interact with government agencies. By contrast, the e-government development in Tajikistan and Turkmenistan has made slow progress, due to their inadequate information and communication technology infrastructure, low computer literacy rates, and limited internet access.

Second, the e-government capabilities of Central Asian countries are constantly improving. The United Nations E-Government Development Index (EGDI) reports on the state of e-government development in all member states. It evaluates the e-government performance level of each country from three important aspects: the scope and quality of online services, regional cooperation in communications infrastructure, and human resources development. According to its 2018 report, Kazakhstan, as an upper-middle-income country, saw significant improvement of its online performance and services from 2016 to 2018, with its EGDI values rising from “high” to “very high.” In 2018, it ranked 39th among 193 countries and became one of the 40 countries with “very high” EGDI values. Uzbekistan and Kyrgyzstan ranked 81st and 91st respectively, moving from the middlevalue group to the high-value group. Tajikistan and Turkmenistan ranked

131st and 147th respectively, moving from the low-value group to the middle-value group. Although digital developments in the five Central Asian countries are at different levels, e-government capabilities in all countries have seen consistent improvement and significant progress.

Different levels of economic digitalization

Among the Central Asian countries, the digital economy of Kazakhstan started the earliest and is growing the fastest, followed by that of Uzbekistan and Kyrgyzstan, while Tajikistan and Turkmenistan are the slowest in digital economy development,

2018 was the first year of ^aDigital Kazakhstan.” In that year, Kazakhstans investments in information and communications increased by 40.3 percent. The proportion of institutions with internet access increased from 67*7 percent to 75.1 percent, and the proportion of institutions with internet resources rose from 21.7 percent to 22.3 percent. The total economic benefit of digitalization in Kazakhstan in 2018 was US$578 million. At the end of November 2019, Kazakhstan had 2.5 million fixed internet users, down 1.8 percent year-on-year, as the internet users had gradually switched to mobile phones. By December 2019, there had been 15.2 million mobile phone users across Kazakhstan, accounting for about 83 percent of the country s total population. Due to the implementation of economic digitalization, in 2019 Kazakhstans annual productivity growth is expected to be between 2 and 10 percent. Its oil field output will increase by 3 percent with a decrease of 10 to 20 percent in production costs; and thanks to precision farming, its agricultural production will increase by 25 to 50 percent.

In 2018, the export and import volumes of Uzbekistans telecommunications and information technology services were US$154.5 million and US$47.1 million respectively, accounting for 5.1 percent and 2.1 percent of its total exports and imports. In 2019, Uzbekistan had 22.5 million internet users, accounting for more than 68 percent of its total population, and had more than 16 million third- and fourth-generation mobile phone users, accounting for more than 48 percent of its population. However, the country only spent US$7.8 million, or 1.5 percent of its total national expenditure, on communications technology. In order to integrate its different information systems and resources of different institutions into a single, protected information space, Uzbekistan is cooperating with Russia on a number of projects involving the legalization of value-added tax and the automation of trademarks and cash registers. As of October 2019, the number of internet users in Kyrgyzstan, growing 18 percent annually, had reached 2.5 million, accounting for 40 percent of the total population. About 70 percent of the country s adult citizens use the internet, and about 2 million of them are social media subscribers. In Kyrgyzstan 40 percent of the population have bank accounts, 15 percent use internet banking, and 5 percent purchase or sell online.

As of October 1, 2019,there had been more than 2.98 million internet users in Tajikistan, accounting for approximately 46 percent of its total population, and 6.19 million mobile communication users, including 4.47 million active users.⁵ In Turkmenistan, the share of internet access for mobile devices increased by 32 percent in 2016, while the access share of landline phones fell by 56 percent. The size of internet users in Turkmenistan has steadily expanded, increasing by 120 percent from October to December 2017 alone. In order to further the transition to a digital economy, Turkmenistan plans to establish the Caspian Sea Innovation and Technology Center, in which a “digital economic park” will be set up to ensure the digitalization of major economic activities of Caspian Sea countries. In 2018, Turkmenistan’s total investment reached US$11.5 billion, mainly in oil and gas, the digital economy, agriculture, transportation, and comm unications.

Foundations for China-Central Asia Digital Silk Road

The Digital Silk Road jointly built by China and the Central Asian countries is not a castle in the air. After years of interactions, the two sides have laid a good foundation for digital cooperation.

Digital economy cooperation already in early stage

First, multiple interconnectivity cooperation programs have already been carried out. There is a good foundation in terms of hardware facilities. For example, the Transit Europe-Asia (TAE) terrestrial cable network, which connects Chinas Shanghai to Germany via more than 20 countries including the Central Asian countries, has been opened. The Urumqi Regional Administration of International Communications Gateway Exchanges for Central Asia and West Asia has been established. And the China-Central Asia fiber optic cable, constructed by China Telecom, China Unicom, and China Mobile, has already been connected. All these have greatly improved Chinas capability and speed of data communication with Central Asia and even Europe, improved the distribution pattern of China telecommunications international gateway exchanges, and effectively enhanced the quality and security of cross-border communication networks between China and the Central Asian countries. China Telecom and its partners in Kyrgyzstan, Tajikistan and Afghanistan, which launched the “Fiber-Optic Silk Road” in 2017, will extend the project to other countries in Central Asia, South Asia and West Asia, and further to the Middle East, Africa and Europe by sea and land. This is an innovative approach of cooperation on land cable networks, and solves the problem of low and obstructed connectivity in traditional cross-border land cables. These efforts will enhance the overall level of network connectivity in Asia and Europe, and strengthen the cross-border information service capability in this region. In addition, the agreement signed by China and Kazakhstan in 2019 on the donation of supercomputers by the Chinese government to Kazakhstan will improve Kazakhstans digital research and development. In terms of network construction, Chinese enterprises such as Huawei and ZTE have become key participants and telecom equipment suppliers in the digital economies of the Central Asian countries like Uzbekistan and Kazakhstan, and have carried out multiple cooperation projects. As the exclusive provider of technical equipment, Huawei has actively participated in Kazakhstans project to extend communications access to every village since 2007, solving the communication problems of more than 300,000 people in remote areas. The 4G network covering the whole territory of Kazakhstan was completed within two years from 2013 to 2015, and it has been available in each village with more than 5,000 people in Kazakhstan. Chinas Inspur Weihai Overseas Service and Kazakhstans Transtelecom have signed a cooperation agreement on the Kazakhstan National Data Center.

Second, cross-border e-commerce cooperation has developed rapidly. Since the beginning of the 21st century, China and Central Asian countries have jointly built several e-commerce platforms and logistics bases across borders, while new models and new business formats have emerged continually; Cross-border and third-party e-commerce cooperation has been growing swiftly, and the distribution of cross-border, cross-agency and cross-domain e-commerce has expanded to vast regions of Asia and Europe. Firstly, governments have been promoting e-commerce cooperation. For example, Chinas Ministry of Commerce and Uzbekistans Ministry of Investments and Foreign Trade signed the memoranda of understanding on investment cooperation and on e-commerce cooperation in November 2019. Both sides agreed to actively create new growth points for cooperation such as e-commerce and mineral resources while expanding traditional trade, and improve the level of facilitation. Secondly, the scale of cooperation among enterprises is continuously expanding. Almost all of Chinas major e-commerce enterprises have carried out cooperation in various fields and modes with Central Asian countries. For example, KTZ Express signed a strategic cooperation agreement on cross-border e-commerce with Huawei and Yili Baitexing Commercial Trading in September 2018. According to the agreement, the parties will jointly develop cross-border express logistics businesses between China and Europe, taking full advantage of the current infrastructure of KTZ Express, including the land port of Altynkol, the Horgos Special Economic Zone, transport and logistics centers, airports and the Aktau port, and the annual freight volume is expected to reach 1 million tons. China and some enterprises in Central Asian countries have established an e-commerce system specifically aimed at Central Asian markets. For example, Ali babas Ali Express has been operating in Kazakhstan for a long time, and has now become the number one online trading platform in the region. Clothing, household, and digital products are the most popular among Kazakhstan’s consumers. Finally, the e-commerce cooperation mode between China and Central Asian countries has been undergoing continuous innovation. For example, Kazakhstans national sovereign wealth fund Samruk-Kazyna, together with Kazakhtelecom and Kazpost, was the first to sign a memorandum of cooperation with Alibaba Group in 2016. By promoting cooperation between Kazakhtelecoms payment business and Alipay, and between Kazpost and Cainiao Network, Alibaba has accelerated the logistics development of cross-border e-commerce in Russia, Central Asia and Eastern Europe. E-commerce cooperation is becoming an important engine for China and Central Asian countries to jointly build the Digital Silk Road.

Third, cooperation in personnel training has been carried out through multiple channels. Since independence of the Central Asian countries, especially since the beginning of the 21st century, PetroChina, Sinopec, Huawei, ZTE, among other Chinese enterprises, have paid more and more attention to the needs of their host countries. They have donated or aided computers and other teaching facilities to some primary and secondary schools or universities in the five Central Asian states, thus contributing to improving the digital and IT capabilities and qualities of the general public in the countries. In terms of professional personnel training, China has a variety of modes and rich experience in training a large amount of digital personnel, including school-enterprise collaboration and integration of industry and education, and has carried out long-term cooperation with Central Asian countries. Among them, more and more international students from Central Asia have come to China to study computer science, information and communications technology, big data, cloud computing, artificial intelligence and other high-tech technologies through scholarships provided by the Shanghai Cooperation Organization, the Chinese government and other channels. Chinese enterprises in Central Asian countries are also training specialized digital talent for the host countries. For example, Huawei took the lead in setting up a joint scholarship with the Kazakhstan International Information Technologies University in 2011 to support local training of communications talent. It not only provides relevant operational and technical training for local companies entering the industry in Central Asia, but also cultivates innovative talent in cooperation with universities in Kazakhstan and Uzbekistan.⁰ Alibaba helps Kazakhstan develop e-commerce training for its small- and medium-sized enterprises, thus boosting the development of local e-commerce. All these have provided effective help and support for the development of the digital economy in Central Asian countries.

Central Asian countries’ demands for digital cooperation

The development of the digital economy in Central Asian countries is in urgent need of external assistance, while China enjoys prominent advantages in this regard. Thus, the Central Asian countries are full of expectations for the development of a digital China, hoping to catch the express train of Chinas digital economy development, to upgrade their economies through digital cooperation with China, and realize the dream of overtaking in corners.

Central Asian countries need to learn from Chinas experience in the development of the digital economy; The development of Chinas digital economy has gradually risen to the height of national strategy* The 19th National Congress of the Communist Party of China has made specific decisions and arrangements to build a digital China and accelerate the construction of an innovative country. In the past few years, China has issued a series of policy documents, covering internet plus, big data, e-commerce, smart cities, innovative development strategies and other aspects, and has built a policy support system with top-level design and specific measures, forming a strong synergy of all sides to promote the development of the digital economy.⁵² In the past two years, Central Asian countries have begun to issue planning measures for the development of their digital economy from the perspective of national strategy, and have continuously drawn on Chinas experience to mobilize joint contributions to the development of the digital economy. In addition to policy design and planning, Central Asian countries also need to learn from the experience and technologies of Chinese enterprises in developing the digital economy. According to a study on the development of the global digital economy conducted by KPMG and AliResearch, which compared the performance of the digital economy of major economies in the world from the five dimensions of digital infrastructure, digital consumers, digital industry ecology, digital public services, and digital scientific research, the United States and China lead the world and rank in the top two. Chinas e-commerce, mobile payment, cloud services, and smart logistics will not only enable small- and mediumsized countries, underdeveloped regions, small and micro enterprises and ordinary people to get more development opportunities, but will also change the traditional commercial models and support businesses of different sizes to establish systematic digital commercial models, which are not limited by location, scale or time. As the economic growth of Central Asian countries is generally slowing down, they hope to learn from the successful experience of integrating traditional industries and digital technologies in Chinas ^ainternet plus” action plan, to create a new impetus for the development of their economies.

Central Asian countries need Chinas market and investment to build a new digital economy cooperation model for the future. Since the start of the 21st century, the Central Asian countries have become increasingly dependent on China for trade and investment, and China has been among the top three trading partners and investors of the Central Asian countries for many years. China has a huge market with a population of more than 1.4 billion and the worlds most populous middle-income group. By October 2019, the number of its internet users had reached 854 million, ranking first in the world. It has formed a digital lifestyle featuring online consumption, shared economy and credit payment. Therefore, the Central Asian countries are paying more and more attention to Chinas huge market potential and digital society form, and have a sense of urgency and crisis that they need to conform to Chinas digital society model in order to participate in Chinas market competition.⁶ In recent years, they have clearly regarded China as an important market for their export-oriented economic development, and have been vigorously expanding the Chinese market in agricultural trade, the industrial sector, and tourism through digital cooperation.

Faced with the escalation of China-US trade frictions, Central Asian countries have taken the initiative to increase the production and exports of soybeans, fruits and vegetables, and livestock to China. They have actively expanded their exports to China through a variety of digital cooperation modes, thus creating more jobs and opportunities. For example, Uzbekistans cherries were introduced into China for the first time in 2019. Within 3 hours of opening on Chinas e-commerce platform Tmall, Chinese customers had placed more than 4,700 orders, which not only created new business opportunities, but also met the needs of Chinese people for delicious food. In the future, the Central Asian countries will take digital cooperation as a priority area, and actively develop cooperation with China in digital trade and digital innovation, to inject new momentum into their economies.

Good bilateral relations as foundation for digital cooperation

First, China and Central Asian countries have already established stable and lasting mutual trust. After more than 20 years of development, Chinas relations with Central Asian countries have continued to improve. Since the beginning of the 21st century, China and all Central Asian countries have established strategic cooperative partnerships. Relations between China and Kazakhstan have risen to a permanent comprehensive strategic partnership, while Chinas relations with Uzbekistan, Tajikistan and Kyrgyzstan have all been elevated to a comprehensive strategic partnership. All Central Asian countries regard the development of relations with China as their diplomatic priority, and this has provided a basic political guarantee for bilateral digital cooperation. Since the outbreak of COVID-19 in early 2020, Kazakhstan and Uzbekistan have provided China with emergency medical supplies as well as moral and practical support, reflecting their close partnership with China.

Second, Central Asian countries are active participants in the Belt and Road cooperation. The Belt and Road Initiative was first proposed in Kazakhstans Nazarbayev University. The Central Asian countries regarded it as an opportunity, responded positively, and took the initiative to synergize their economic development strategies and the Chinese initiative. In 2016, China and Kazakhstan signed the Cooperation Outline on Docking the Silk Road Economic Belt Construction and the New Economic Policy of the “Bright Road.”】 When the new President of Kazakhstan Kassym-Jomart Tbkayev visited China in September 2019, the two governments further signed a memorandum of understanding on implementing the cooperation plan between the New Economic Policy and the Silk Road Economic Belt. China and the Central Asian countries have reached a high degree of consensus on the Belt and Road cooperation, laying a sound foundation for building the Digital Silk Road.

Finally, the Digital Silk Road initiative is in line with the digital economic development strategies of Central Asian countries. The digital economic development strategies put forward by the Central Asian countries in recent years coincided with the initiative proposed by President Xi Jinping to jointly build the Digital Silk Road. President Tbkayev stressed cooperation with China in jointly developing the digital economy during his two visits to China in 2019, and the leaders of Uzbekistan, Kyrgyzstan, Turkmenistan, and Tajikistan also expressed the desire to develop digital cooperation with China. Both China and the Central Asian countries are developing countries and countries in transition. They can jointly seize the opportunities brought by the Fourth Industrial Revolution and realize leapfrog development by jointly building the Digital Silk Road, synergizing their digital economic development strategies, and deepening practical cooperation in many fields, such as digital infrastructure connectivity, digital technology innovation and  digital transformation on the basis of complementary advantages.

Multi-level platforms for digital economy cooperation

China and Central Asian countries have already established multilevel institutional cooperation platforms for stable exchanges. Thanks to the routine exchange mechanisms, the digital economy cooperation between China and the Central Asian countries will become deeper and more solid.

The multilateral and bilateral meeting mechanisms between the heads of state of China and the Central Asian countries can play an important role in top-level design and substantive promotion. The Council of Heads of State of the Shanghai Cooperation Organization, the Conference on Interaction and Confidence Building Measures in Asia, and the leaders⁵ mutual visits have become important platforms for promoting digital cooperation between China and the Central Asian countries. For example, the China-Kazakhstan joint statement signed during President Tbkayevs visit to China in 2019 stated that the two countries should ‘strengthen cross-border e-commerce cooperation, establish e-commerce cooperation mechanisms, create new business forms and modes of cooperation, and promote the docking of digital economy development plans between the two countries. President Tbkayev also invited \^ng Jian, Chairman of the Technology Steering Committee of Alibaba Group, to serve as Kazakhstans high-tech consultant, starting practical cooperation based on Chinas experience.

China and Central Asian countries have established various regional and sub-regional mechanisms and multilateral dialogue platforms in many professional fields to promote effective cooperation. In recent years, professional platforms initiated or hosted by China, such as the World Internet Conference, the World Artificial Intelligence Conference, the Smart China Expo, the Digital China Summit, and the Sino-Kazakhstan Cross-border E-Commerce Cooperation Forum, have become increasingly influential, attracting more and more Central Asian enterprises and institutions, and becoming important occasions for conducting high-end dialogues, exchanges and cooperation, and demonstrating achievements of China and the Central Asian countries in the digital economy.

In addition, the Belt and Road Forum for International Cooperation has provided a high-level platform for cooperation. The representatives from China and the Central Asian countries can jointly determine cooperation priorities at the forum and reach multiple multilateral or bilateral agreements for cooperation. For example, at the first Belt and Road Forum in 2017, the framework agreement of cooperation was signed by China and Kazakhstan regarding full support of Chinese telecom companies⁵ participation in the “Digital Kazakhstan 2020″ program, and the China-Kazakhstan Production Capacity Cooperation Fund came into operation.

Challenges for China-Central Asia Digital Silk Road

As the development of the digital economy is just at an early stage in Central Asian countries, there are differences in the national power, promotion efforts and the choice of partners between the states. The digital gap between the countries, between industries, and between urban and rural areas is huge, and the gap between grand strategies and harsh reality is common in the region. Mounting difficulties lie ahead for Central Asian countries to realize the goal of digital transformation. Therefore, China and the Central Asian countries will face many tests in their digital economy cooperation, and competition from external countries will bring challenges to them in jointly building the Digital Silk Road.

Lagging digital infrastructure construction

Internet informatization is based on electronic technologies or equipment. Submarine optical fiber cables are used for intercontinental connectivity. The speed, quality, and cost of network communication are major restraining factors for the development of the digital economy. Therefore, to enhance the quality and efficiency of digital infrastructure services, the primary task is to greatly improve the network bandwidth and network performance. However, the construction of network and other hardware infrastructure usually lags behind in Central Asian countries and the broader Eurasian region. For example, with low-quality urban optical fiber equipment, unstable telecommunications networks for continuous operation of digital equipment, low coverage and speed of wireless broadband, and difficult access to network infrastructure in remote areas, Uzbekistan simply lacks the modern technology and infrastructure that can ensure the stable operation of its digital economy; Kyrgyzstan does not have a national geospatial data system for navigation across the country. As the address register for GPS cannot work properly, the residential area maps in the country are barely accurate, and taxi fare cannot be correctly calculated due to the inability to provide right addresses on maps. Turkmenistans internet coverage is relatively limited. It has just begun to establish an advanced communications system to increase the quantity, quality and variety of communications services and provide broadband services for the most remote areas of the country. The lagging digital infrastructure construction among the Central Asian countries has affected the coverage and operation speed of their networks, and it will affect the number of users participating in digital cooperation with China and the cooperation efficiency;

The slow development of soft infrastructure such as digital finance in Central Asian countries has affected the development of e-commerce. For example, with a mobile internet that often encounters breakdown and low speed, it is difficult to deposit cash into bank cards in Uzbekistan. As UzCard, the countrys dominant payment system, does not work adequately; 70 percent of the citizens still prefer to pay cash rather than use bank cards or payment systems in online shopping. Kyrgyzstans public portal websites do not support mobile payment, and the national payment system does not accept foreign currencies, making it difficult to transfer money from foreign accounts, The range of digital financial services in Turkmenistan is very limited, and services such as electronic remittance, online shopping and purchase of railway tickets have just begun. The slow development of digital finance in the Central Asian countries makes it difficult to interface with Chinas electronic payment, bank wallet and other new payment methods. Problems such as poor electronic exchange and tax coordination in cross-border e-commerce will affect the efFectiveness of cooperation between the two sides.

Different rules and regulation for digital governance

The development of digital economy requires a strong legal framework and rules system to protect the interests of all parties. In cross-border digital services and trade, it is increasingly difficult to establish and implement national laws and regulations, and certain policy space is necessary for individual governments to regulate the digital economy in order to fulfill various legitimate public policy objectives.⁷² Currently, the digital development of Central Asian countries goes faster than the enactment of relevant legislation and rules in areas such as digital competition, electronic

Shavkat Mirziyoyev, President of Uzbekistan, declares 2020 the year of the development of science, education, and the digital economy, in an address to the country’s parliament on January 24.

taxation, cross-border data flow, intellectual property rights, digital trade, and usage of digital information. China and the Central Asian region differ greatly in the level of digital governance and regulation, and there is still a lack of clear and unified governance rules and regulatory policies. Both sides need to jointly determine the standards and rules of digital governance and regulation in various fields such as payment methods in cross-border e-commerce, customs e-port, and cross-border tax supervision.

A unified set of digital rules have not yet been established in the Central Asian region, and there are great hidden dangers and concerns in its cyberspace security; Due to the lack of basic information and communications technology (ICT) policies or principles at the legislative level, relevant laws in the Central Asian region are short of consistency, which makes the regional ICT regulation fragmented. In terms of the legal guarantee system, the Central Asian countries are now in different categories. Among the five regional states, only Kazakhstan has comprehensive legal protection against cybercrimes and has enacted laws on data protection and confidentiality; In Uzbekistan and Kyrgyzstan, there has been at least one draft law on electronic transactions in their major legislative agendas. In Tajikistan and Turkmenistan, the relevant laws are still in preparation, and consumer confidence is still very low, which limits the growth of their e-commerce7³ In addition, cyber fraud and cybercrimes occur frequently in the Central Asian countries. Netizens are faced with increasing risks such as spam, internet viruses, and cyberattacks. There are widespread cybersecurity concerns involving consumer privacy, personal data protection, and e-government information security. All these will affect the security and effective supervision of digital economy cooperation between China and the Central Asian countries.

Lack of digital professionals

There is a serious shortage of digital talent in Central Asian countries, and there is also a shortage of compound professionals who are proficient in both technology and foreign languages and able to smoothly communicate and cooperate with foreign countries. This has become a bottleneck restricting the digital cooperation between China and the Central Asian countries. For example, under the “Digital Kazakhstan^ framework, 80 percent of the countrys public services is planned to be digitalized by 2022. However, due to the serious shortage of ICT professionals in Kazakhstan, the implementation of this framework is bound to be adversely affected. As the most populous country in Central Asia, over 60 percent of Uzbekistan s population are young people with an average age of under 29. However, in 2019, the countrys ICT professionals accounted for only 0.5 percent of the employed population, far lower than the EU average of 3.7 percent. The shortage of digital talent in ICyrgyzstan, Tajikistan, and Turkmenistan are even more serious. A large number of ordinary people in these countries lack basic internet skills and are in urgent need of “digital literacy.” This is partly because the digital development in the Central Asian countries has just started, and the number and professional level of teachers for training digital talent in universities are limited. Moreover, hoping to be employed in private enterprises to obtain higher incomes, many digital talent prefer to work in Russia, Europe, or the United States. The Central Asian countries are in urgent need of training more digital professionals, and at the same time they also need to improve the digital capabilities of their citizens. The low digital literacy rate of people in Central Asian will affect the breadth of digital cooperation between China and the Central Asian countries, and the lack of digital talent in the states will hinder the depth of the cooperation.

Increasing uncertainties arising from multinational competition

Central Asian countries have been the targets of multinational competition for nearly 30 years since their independence. The complexity of multinational competition has increased political and security risks for investors. The centrality of Central Asian geopolitics and the local demands for external assistance have led many neighboring and extraterritorial countries to actively engage in regional affairs, and this trend will continue in the future. The multinational competition in Central Asia will affect the regional countries choice of digital economy partners. In addition to the Silk Road Economic Belt and the Eurasian Economic Union, the United States, Japan, and the European Union have all proposed their own economic development plans in this region, such as the New Silk Road initiative of the United States, Japans Silk Road Diplomacy and its vision of an economic corridor, and European scholars concept of European Silk Road- Furthermore, they have also established various mechanisms, such as the “C5+1” (five Central Asian countries plus the United States) and the Foreign Ministers⁵ Meeting of the ^aCentral Asia plus Japan” Dialogue. At present, although Chinas Belt and Road Initiative has received extensive response and welcome from the Central Asian countries because of its openness and inclusiveness, there is competition among various countries⁵ economic cooperation ideas in Central Asia due to different interests and demands of the regional states. In particular, the United States launched the new Central Asia strategy, and used the pretext of promoting democracy and economic cooperation to interfere in the independent development of regional countries, obstruct their friendly cooperative relations with neighboring countries such as Russia and China, and wield its economic and legal leverage to block China from bidding for infrastructure projects in Central Asia. In the battle for global market share of 5G technology, the United States is even trying to cultivate competitors that could crowd out Huawei products. As some countries in the ^aintermediate zone^,, of Central Asia frequently change their behavior, pursue short-term interests, making it hard to predict their policies, uncertainty is inevitable in developing digital economy cooperation between China and these countries.

Complicated investment environment

For a long time, there have been security challenges in the Central Asian region. The threat of the three forces of separatism, extremism and terrorism, the spillover of the Afghanistan issue, and the regions chronic problems of drug smuggling, transnational crimes and illegal arms sales have all affected the social security and stability in Central Asia. The impact on the digital economy cooperation projects between China and the Central Asian countries cannot be ignored.

The business environment in Central Asian countries is not satisfactory. According to the 2020 Business Environment Report released by the World Bank, Kazakhstan ranks 25th, which is relatively good, while Uzbekistan, Kyrgyzstan and Tajikistan rank 69th, 80th and 106th respectively.⁴ At the same time, corruption in the Central Asian countries is relatively serious, and according to the Global Corruption Perceptions Index released by Transparency International in January 2019, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, and Turkmenistan ranked 124th, 132nd, 152nd, 158th, and 161st respectively; In recent years, nationalism or regionalism has risen in some Central Asian countries. In the process of selecting and implementing digital economy-related projects, governments of these countries may give priority to their domestic enterprises or those of other Central Asian states, which may increase the costs and uncertainties of Chinas investment in Central Asian digital projects.

Approaches for China-Central Asia Digital Silk Road

China and Central Asian countries have reached a broad consensus on deepening digital economy cooperation and jointly promoting the construction of the Digital Silk Road. According to different development stages of the digital economy in the Central Asian countries, through country-specific policy support and strategic synergy, China can help promote the digital transformation and modernization of the Central Asian countries, enhance the development level of Asia-Europe digital economy, and build a beautiful and win-win Digital Silk Road.

Building digital infrastructure to promote connectivity

With successful experience and sound business models, China is leading the world in the digital industry and internet finance, while Central Asian countries are in the initial stage of digital economy development. With its own strengths, China can actively participate in the construction of digital infrastructure in Central Asian countries to achieve connectivity in the fields of data and information services, internet services, and international communications services.

First, cooperation can be conducted in the construction of digital infrastructure hardware. Utilizing their own advantages, relevant Chinese enterprises can actively participate in the proposed projects of hardware facilities in Central Asian countries, which involve areas such as the internet, the Internet of Things, and optical fiber cables. There is a great demand for digital infrastructure in Central Asia. For example, Kazakhstan plans to provide broadband internet access for 18 million people by 2022, and increase the proportion of internet users from 81.3 percent in 2019 to 82.3 percent at the end of 2022.88 In Uzbekistan, it is planned that all of more than 20,000 social facilities, including schools and medical institutions, will have optical fiber internet access by the end of 2020, and that the number of smartphone users will increase to 23 million. To this end, Chinese enterprises can help build network facilities such as optical fiber cables, man-made satellites, telephone lines and cable television lines, provide routers, readers, repeaters and other hardware devices that control transmission channels to the Central Asian countries, raise the availability of digital infrastructure and services in those countries, and bring to both sides internet access characterized by high speed, wide availability, full coverage and intelligence.

Second, cooperation can be conducted in the construction of digital infrastructure software. Chinese enterprises can continue to participate in the construction of digital software facilities in Central Asian countries and work with the states to establish basic ICT infrastructure that combines high-quality software and hardware. At present, Kazakhstans Ministry of Digital Development has drawn up a roadmap for 5G development, and is studying a new technical standard for 5G mobile communications with pilot projects implemented in Nur-Sultan, Almaty and Shymkent. The Ministry also plans to introduce 5G technology in the Nazarbayev University and the World Expo Park in Nur-Sultan before the end of 2021, and promote it nationwide from 2023.91 Uzbekistan is in the initial stage of building a 5G network. It completed the test of the 5G mobile communications network in 2019, and set the target of starting a commercial network in Tashkent in 2020. Huawei and other enterprises can actively participate in the above projects. Besides, China can engage in the process of digital industrialization in Central Asian countries, which are undergoing different stages of economic digitalization. For example, China and Central Asian countries can jointly build digital pipelines and work on other projects to advance the informatization of the oil and gas industry, and apply 5G technology and the Internet of Things to energy exploitation in Central Asia. China can also participate in the industrial digitalization of Central Asian countries, getting involved in various fields such as digital medical treatment and digital education, and sharing its technologies and experience in “‘internet plus,” cloud computing and block chain. Furthermore, China can develop new business forms and models suitable for the development level of the local digital economy, to help promote the digital transformation and the digital ecosystem in Central Asian countries.

Improving governance to facilitate digital economy development

The transnational and mobile nature of the digital economy requires more dialogues among countries to build consensus and jointly make decisions. With the rapid development of digital economy cooperation between China and Central Asian countries, the two sides, while adhering to the principles of common participation, mutual benefits and shared responsibility, can carry out multilateral dialogues and exchanges and create model areas to jointly improve the level of digital governance in the Central Asian region.

China and Central Asian countries should actively participate in the construction of a future-oriented digital community framework. In this initial stage of global governance in the digital economy, the two sides should strive for more power and jointly create opportunities to gain more say for all developing countries. China and Central Asian countries are members of mechanisms such as the Internet Governance Forum Plus, the Regional Commonwealth in the Field of Communications, the “Digital Silk Road” sub-fbrum of the Belt and Road Forum for International Cooperation, as well as regional cooperation platforms such as the Shanghai Cooperation Organization and the Conference on Interaction and Confidence Building Measures in Asia. By effectively utilizing these mechanisms, the two sides can gradually establish regular exchanges for digital cooperation in Central Asia, set up a Central Asian digital economy governance network, share experience in digital governance, and discuss the unification of data standards and data usage principles. Moreover, they can jointly formulate relevant governance rules, and coordinate their policies on competition, cross-border data exchange, cross-border taxation, and regulation.

Efforts should be made to jointly build an orderly; open and secure digital world. China and Central Asian countries should strengthen exchanges and cooperation on the construction of legal system concerning data, and improve laws and regulations on data protection. The two sides should work to regulate the collection, processing and exchange of data on personnel entry and exit, import and export of customs commodities, electronic payment, cross-border logistics and cross-border transportation. They should strengthen consultations in the field of data protection, promote their communication on data risk prevention, safeguard cybersecurity and a fair competitive environment, and crack down cross-border crimes that endanger data security such as infringement of personal information, in order to build a legal and regulatory protection system in the digital economy of Central Asia.

E-commerce cooperation to deepen regional economic ties

Chinas e-commerce growth is among the fastest in the world. Ten years ago, Chinas retail e-commerce turnover was less than 1 percent of the global total. By 2019, Chinas e-commerce turnover had ranked first in the world, accounting for more than 40 percent of the global total. China can share its e-commerce development experience with Central Asian countries and vigorously promote cooperation between the two sides in this field.

China and Central Asian countries can jointly explore each others cross-border e-commerce market. Chinas e-commerce market ranks first in the world. In 2016, Chinas import e-commerce transactions exceeded one trillion yuan.⁴ The cross-border e-commerce turnover reached 9.1 trillion yuan in 2018, and is expected to exceed 10 trillion yuan in 2019 and 12.7 trillion yuan in 2020. Central Asian countries can fully tap the potential of Chinas huge market, which has a population of 1.4 billion, and through e-commerce, make China an important destination for their exports such as agricultural and manufactured products. The digital trade markets of Central Asian countries also have great potential. A case in point is Kazakhstan. It is estimated that by 2025, the countrys internet shopping transactions will increase to 500 billion tenge (about US$1.3 billion), accounting for 5 percent of its total retail sales. The revenues which logistics companies derive from Kazakhstans e-commerce transit transport will increase to 1.3 trillion tenge, creating as many as 280,000 new jobs. In addition, China is strengthening ties with Central Asian countries not only for the huge markets of more than 70 million people in the region, but also for their huge potential in transit transportation to third-party markets such as Europe, South Asia and West Asia.

China and Central Asian countries should constantly innovate their e-commerce cooperation forms. At present, China and the Central Asian countries along the routes of the China-Europe freight trains have jointly launched a one-unit cross-border blockchain platform for multimodal transport and a one-stop service for customs clearance and settlement by cross-border e-commerce operators. The Cross-Border E-Commerce Pilot Industrial Park in Urumqi International Land Port Area, China, provides all-round services of customs clearance and bonded warehousing for cross-border e-commerce enterprises, and is exploring a new mode of integrated development of ^acommerce+internet+logistics.^> There are two business models on which China and Central Asian countries can jointly experiment: one is M2B2C, from China-based manufacturing enterprises to their overseas branches and then to overseas consumers, and the other is B2B2C, from China-based foreign trade enterprises to their overseas branches and then to overseas consumers. The two sides can work to make breakthroughs in the assessment norms, business processes, technical standards, and regulatory patterns of the B2B2C model, in order to improve operational efficiency;

China and Central Asian countries should also work together to create a positive environment for cross-border e-commerce operators and facilitate regional trade. Currently, Kazakhstan is gradually modernizing its border checkpoints, and plans to use innovative technology to build a new “Bright Road” crossing point on the China-Kazakhstan border to simplify the customs clearance process and transit transportation procedures.⁷ China and Central Asian countries can jointly improve the customs supervision services, streamline the inspection and quarantine processes, relax the policy restrictions on import and export tax and settlement, and negotiate to improve relevant payment, quarantine and logistics policies, thus reducing the policy and legal risks for cross-border e-commerce operators.

Training digital professionals for human resources guarantee

The quality of digital professionals determines the quality of digital transformation. China and Central Asian countries can further promote their cooperation in digital professional training in two areas: the cultivation of basic IT capabilities among the general public and the training of IT specialists.

The key to cultivating basic IT capabilities of the people in Central Asia is to provide IT training facilities, such as computers, and basic school education which starts from primary and secondary schools to improve the IT application capabilities of the public. The education rates in Central Asian countries are generally high, but due to various reasons, such as the age of the population, lack of computers, and remoteness, a considerable number of people are still in need of digital literacy, namely the ability to use computers and the internet. In Kazakhstan, the country with the highest digitalization rate among the Central Asian states, a total of 532,000 people received digital literacy training in 2019, over 60,000 more than planned. China can participate in various cooperative projects such as community IT training programs and digital literacy training classes, and assist the regional states in providing digital education and improving digital skills in difïerent levels of educational institutions.” The digital economy cooperation between China and Central Asian countries can be further advanced only when more and more citizens have basic ICT skills,

China can help Central Asian countries, through multiple channels and in multiple forms, in training professionals and improving the digital competence of employees. With the rapid development of the digital economy in Central Asian countries, artificial intelligence, the Internet of Things, robots, and virtual reality have been regarded as the most needed professional skills amid the IT revolution. In recent years, Central Asian states have begun to cooperate with many countries to cultivate IT professionals through various channels. For example, in 2019 Uzbekistan and the United Arab Emirates have launched a joint training project involving 1 million programmers. China can also train digital professionals jointly with Central Asian countries. Universities and enterprises from both sides may serve as mediators to achieve the integration of industry and education through intergovernmental projects, university-enterprise joint projects, and targeted training projects. Comprehensive cooperation can be carried out in many fields, such as the establishment of new IT disciplines, the determination of scientific research topics, and the construction of training bases, so as to match the IT curriculum with the needs of various countries, promote the effective connection between the development of the digital industries and the model of professional training in Central Asian countries. With the improvement of digital capabilities in the regional countries, it is also possible for the two sides to work jointly on training the new generation of professionals with multiple IT skills, such as e-commerce, blockchain, artificial intelligence, big data, the Internet of Things, and cloud computing. This process would help form a supply chain of professional training that involves universities, students and enterprises, and truly benefit the digital transformation and economic development of Central Asian countries.