China Focuses Investment on Belt and Road Countries

Chinese companies' acquisition activities along the Belt and Road countries have increased this year in spite of a dramatic fall in overall Chinese outbound investment, according to the latest Thomson Reuters data.

 

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The data showed that Chinese firms have invested in mergers and acquisitions to the value of $33 billion in the 68 countries along the Belt and Road map as of August 14, surpassing the $31 billion figure for the whole year of 2016.

The increase in investments in the Belt and Road countries is compared with a 42 percent drop in all Chinese international mergers and acquisitions over the same period, the Thomson Reuters data showed.

The UK has also proven a major target for Chinese buyers. Thomson Reuters tracked 29 Chinese takeovers of UK companies worth a total of 13 billion pounds ($16.7 billion). At the same time last year, 25 deals worth 3 billion pounds had been agreed.

Mike Wang, partner at the Chinese law firm King & Wood Mallesons said the data matched their business experience. "Our clients are finding it much easier to foster constructive relationships with target companies on the Belt and Road map, with support from both the Chinese government and the target company’s government," he said.

First proposed by President Xi Jinping in 2013, the China-led Belt and Road initiative aims to increase trade and investment among Asia, Europe and Africa.

President Xi also said at the Belt and Road Forum in Beijing in May that China will contribute an additional 100 billion yuan ($14.49 billion) to the Silk Road Fund for investments in Belt and Road countries.

Xue Haibin, managing partner of Zhong Lun Law Firm's London subsidiary, said the growth in UK-focused deals is supported by the UK government's attempt to foster closer ties with China and Asia amidst Brexit uncertainties.

"The UK is proactively positioning itself as an important part of the Belt and Road map. Because Belt and Road strategy development needs both real economy and financial collaboration, the UK’s strength in financial services gives it a unique advantage," Xue said.

The number of Chinese deals targeting Belt and Road countries totaled 109 this year, compared to 175 in the whole of last year and 134 in 2015, the Thomson Reuters data showed.

The largest deal in a Belt and Road country so far this year was a Chinese consortium's $11.6 billion buyout of the Singapore-based Global Logistics Properties, announced in July. The consortium comprises Hopu Investment Management, Hillhouse Capital Group, Vanke Group and Bank of China Group Investment.

Another top deal is China National Petroleum Corp's $1.8 billion purchase of an 8 percent stake in Abu Dhabi National Oil Co, announced in February.

Andrew Monk, CEO of VSA Capital Plc, a London-based investment bank with a subsidiary in Shanghai, said from his observations most of China’s outbound deals along the Belt and Road countries fit into China's strategic development.

"The deals done so far are in sectors that add value to China’s strategic growth, especially in areas such as technology, renewable energy and green industries," he said.

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Northern Australia calls on government to join in the Belt and Road

More Australian businesses and academics are asking for the Northern Territory Government of Australia to support the engagement with China’s Belt and Road Initiative, according to Australian Broadcasting Cooperation.

The report said Northern Territory businesses have turned to Chinese investment as a way to boost the economy, despite Australian authorities’ reluctance to join in the initiative.

China is said to have invested more than the Australian government in Northern Territory, and the investments are broadly supported by some of the country’s biggest banks, law firms, and consulting companies. A Belt and Road Conference is being organized by The Australia China Business Council (ACBC) to tie Northern Australian businesses with Chinese investors.

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Daryl Guppy, president of the territory’s ACBC branch, said that the Federal Government made a mistake declining China’s offer to link northern Australian development with the Belt and Road.

“The reality is that we don’t have our own internal domestic funding that will help develop northern Australia,” he said. “We can’t stop China’s expansion, that’s an inevitability and the rest of Australia should have recognized that.”

According to the report, the Australian Labor Party wants Australia to formally align itself with the project and has held talks with the Federal Government on the issue.

Northern Territory is located in the central and central northern regions of Australia, making up 40% of the land but with only 5% of the Australian population. Largely driven by mining, the Northern Territory has remained prosperous after the end of gold rush with the help of China.

The Chinese-owned company Landbridge bought large grounds in Darwin, the capital city of territory, as well as a 99-year lease of Darwin Port in 2015, which is just the tip of the iceberg, as China has invested 30 billion AUD ($23 billion) in Australia over the past two years, according to data released by KPMG.

Former U.S. President Barrack Obama even expressed worry towards Australian Premier Malcolm Turnbull because of the port’s close proximity to a U.S. Marine Corps military base in Top End, according to Financial Times.

The Northern Territory Government acknowledges that overseas investment is vital to the development of northern Australia. State Grid Corporation of China is building a $630-million natural gas pipeline from the Northern Territory to Queensland. Direct flights from China to the Northern Territory could begin in a matter of months as part of the government’s plan to double the number of visitors from China.

Proposed by China in 2013, the trillion-dollar Belt and Road Initiative aims to build trade and infrastructure networks connecting Asia with Europe and Africa on and beyond the ancient Silk Road routes. The initiative is actually the combination of two projects: the Silk Road Economic Belt and the 21st Century Maritime Silk Road.

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Sino-Kazakh Ties 'Set Example', Then Who Will Be Next?

Xi starts the trip of visit to partner in Belt and Road

China and Kazakhstan will tap their great potential for cooperation, including jointly building the Belt and Road, President Xi Jinping wrote in a signed article on Wednesday.

The president arrived in Astana, capital of Kazakhstan on Wednesday. In a statement issued upon arrival, he said, "The Sino-Kazakh relationship has set an example of a friendly neighborhood, equal treatment and mutual benefits for the international community."

The two countries have strengthened political trust, pushed forward pragmatic cooperation in all areas steadily, and enhanced coordination in global and regional affairs in the past 25 years since the establishment of diplomatic relations, Xi said.

The four-day visit to Kazakhstan is Xi's third trip to the Central Asian country. During the stay he will also attend the Shanghai Cooperation Organization annual summit and the opening ceremony of the Astana Expo 2017.

Xi extended sincere greetings and best wishes to the Kazakh people. Xi also mentioned his frequent meetings in recent years with his Kazakh counterpart, Nursultan Nazarbayev, saying that the two presidents have developed good working relations as well as a personal friendship.

In the article published in the Kazakh newspaper Kazakhstanskaya Pravda on Wednesday, Xi said China will promote cooperation with Kazakhstan in jointly building the Belt and Road.

It was during his first visit to Kazakhstan back in 2013 that Xi proposed the Silk Road Economic Belt Initiative. Four years later, the idea that took root then has become a global public benefit.

"The general direction of the two countries' national development was determined during President Xi's visit to Kazakhstan in 2013, namely, the joint building of the Silk Road Economic Belt," Chinese Ambassador to Kazakhstan Zhang Hanhui said.

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Sun Zhuangzhi, secretary-general of the SCO Research Center under the Chinese Academy of Social Sciences, said enhancing cooperation between the two countries as part of the Belt and Road Initiative will serve as a convincing model for other parties.

Xi wrote in the article that industrial capacity cooperation should be made a new area of growth in bilateral cooperation.

Beijing and Astana also need to promote high-tech and innovation cooperation and develop programs that help bring people of the two nations closer, Xi said.

The president especially noted that Kazakh singer Dimash Kudaibergenov is "now a household name in China". Popular Chinese films and TV series, such as A Bite of China or Family on the Go, have captivated more and more Kazakh viewers.

"China will encourage more visits by its citizens to Kazakhstan for tourism so that they will see for themselves the unparalleled beauty of this 'Uly Dala Eli', the land of the great steppe," the president wrote.

The two sides will also deepen security cooperation, including measures for Belt and Road cooperation, to ensure the security of oil and gas pipelines and other large projects, he added.

As for the SCO summit, Xi said in the article that "heads of the member states will make a number of important decisions on deepening cooperation in all fields and completing the organization's first membership expansion".

China will succeed Kazakhstan as the rotating chair at the conclusion of this summit.

Xi Jinping added that the theme of "future energy" at Astana Expo 2017 "is very consistent with the global green, healthy and sustainable economic growth trend, highly compatible with the China Green Silk Road Initiative".

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China's New World Order: Ambition Behind Belt and Road

May 15, 2017, there is a Leaders' Roundtable Summit for International Cooperation at Yanqi Lake International Convention Center in Beijing, a total of 29 foreign heads of state and government leaders attended the two-day forum, and Chinese President XI Jingping chair elaborates on inspiration behind Belt and Road Initiative.

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BEIJING, May 15, Chinese President Xi Jinping on Monday elaborated on what had inspired him to come up with the Belt and Road Initiative, stressing that it is aimed at galvanizing global cooperation and is open to all.

Xi made the remarks at the Leaders' Roundtable Summit at the Belt and Road Forum for International Cooperation in Beijing.

"The Belt and Road development does not shut out, nor is it directed against, any party," Xi told the summit.

Proposed in 2013, the Belt and Road Initiative is a grand plan to connect Asia with Europe and Africa along, and beyond, ancient trade routes by putting in place an unparalleled trade and infrastructure network.

At Monday's summit, Xi spoke of the myriad challenges the world faces: sluggish trade and investment, wobbling economic globalization, increasingly unbalanced development, impact from large-scale migration of refugees and immigrants, as well as wars, conflicts and terrorism.

Countries are exploring their own ways to deal with these challenges and have put forward many good development strategies and initiatives, but it is difficult to rely on a single country to manage or solve the global problems, Xi said, citing the inter-dependence between nations.

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Only by aligning their policies and integrating economic factors and resources in a global scale can countries create synergy to promote world peace, stability and shared development, he noted.

Under these circumstances, the world may well draw wisdom and strength from the ancient Silk Road, which features the spirit of peace and cooperation, openness and inclusiveness, mutual learning and mutual benefit, Xi said.

Though originating from China, the Belt and Road Initiative belongs to the whole world, while its development goes beyond regions, stages of development, and civilizations, according to the president.

He described the Belt and Road development as a "brand of cooperation" that is open and inclusive, and a global public good jointly provided by all parties.

Under the Belt and Road framework, Xi explained, all parties can join hands to meet the global challenges in the principle of extensive consultation, joint contribution and shared benefits.

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The initiative also enables countries to create new development opportunities and impetus, and leverage their comparative advantages for win-win results, to make progress toward building a community of shared future for mankind, he said.

Xi said he is glad to see positive responses to and extensive support for the initiative from the international community, with more than 100 countries and international organizations already engaging in it.

Everyone hope can cooperation together and get to win-win. Xi’s main speech told us that only by aligning their policies and integrating economic factors and resources in a global scale can countries create synergy to promote world peace, stability and shared development.

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