SCIO briefing on production capacity cooperation under B&R Initiative

Economy

Speakers:
Ning Jizhe, vice chairman of National Development and Reform Commission

Xin Guobin, vice minister of Industry and Information Technology

Chairperson:
Xi Yanchun, vice director-general of the Press Bureau, State Council Information Office

Date:
May 12, 2017

Chairperson Xi Yanchun:

Ladies and gentlemen, good morning. Welcome to the press conference of the State Council Information Office. Today's conference will again be about the Belt and Road Initiative.

We are delighted to invite Mr. Ning Jizhe, vice chairman of National Development and Reform Commission, and Mr. Xin Guobin, vice minister of Industry and Information Technology, to introduce developments in production capacity cooperation between countries and regions along the Belt and Road. They will also answer some of your questions.

Now, let's welcome Mr. Ning to give his briefing.

Ning Jizhe:

Good morning, friends from the media. It’s a pleasure to meet you ahead of the Belt and Road Forum for International Cooperation. Today, we will talk about the production capacity cooperation between countries and regions along the Belt and Road.

As proposed by President Xi Jinping, the Belt and Road Initiative has opened a new chapter for coordinated development of China’s coastal and inland areas, and for the country’s opening up both eastward and westward. It has also charted a new course for different countries to achieve win-win cooperation and peaceful development, and to build a community of a shared future. The initiative has made significant achievements thanks to the enthusiastic response and active participation of all sides.

International production capacity cooperation is a major approach to jointly build the Belt and Road. With this approach, China can use its overall advantages in equipment development, technologies and funds, as well as its comparative advantages in a wide range of fields, to meet the demands for supply and growth of countries along the route, thus promoting common development of the real economy and infrastructure, and achieving complementarity, cooperation for mutual benefit and common development.

China adheres to the Initiative’s principle of extensive consultation, joint contribution and shared benefits to promote green, orderly, open and balanced development of all countries, with industrial enterprises being major players. Fruitful results in production capacity cooperation have been achieved in the following four aspects.

First, an extensive cooperation mechanism has been established. Regarding bilateral cooperation, China has signed production capacity cooperation deals with more than 30 countries along the Belt and Road, such as Kazakhstan and Malaysia. It has also increased cohesion in development plans and projects with other countries, and promoted enterprise cooperation. Regarding multilateral cooperation, China actively participates in and promotes regional and sub-regional cooperation. A series of important documents, including the Joint Statement between ASEAN and China on Production Capacity Cooperation and the Joint Statement on Production Capacity Cooperation among the Lancang/Mekong Countries, have been issued. Plans have also been developed to promote production capacity cooperation in important fields and projects with other countries and to speed up the building of a cooperative framework aiming at achieving win-win situation through open and inclusive approaches.

Second, a number of major projects have been launched. China’s first overseas contracts in regard to high-speed railways and nuclear power have been signed with countries along the Belt and Road. A deal on the Jakarta-Bandung high-speed railway has been secured, with construction starting soon. Construction of unit No.2 of Pakistan’s Karachi nuclear power plant has begun. In various countries, steady progress has been made regarding their programs in the steel, nonferrous metal, construction materials sectors, as well as other fields that all have a great need for Chinese equipment and technology.

From 2013 to 2016, direct investments made by Chinese enterprises in those countries have surpassed US$60 billion. By the end of 2016, Chinese enterprises had established 56 business cooperation zones in those countries, attracting over 1,000 companies. They have generated total output valued at over US$50 billion, total tax revenues of over US$1.1 billion and more than 180,000 new jobs for the host countries. In the first quarter this year, Chinese enterprises have signed nearly 1,000 project contracts in those countries valued at US$14.4 billion, 4.7 percent up year-on-year and accounting for nearly half of the total value of contracts signed in Q1.

While countries along the Belt and Road have become major destinations for Chinese investments and major markets for Chinese infrastructure, equipment, technologies, services and brands, Chinese enterprises have made concrete contributions to those countries by improving their infrastructure, upgrading their productivity, accelerating their industrial development, enhancing employment and improving people’s livelihood.

Third, the support system has been enhanced. To provide strong support to enterprises engaging in production capacity cooperation, we are giving full play to policy-based, development-oriented and commercial financial institutions. We have established cooperation funds and other financial platforms, and encouraged financial institutions to launch various programs to promote cooperation in this regard. By the end of 2016, the China Development Bank and the Export-Import Bank of China had issued loans totaling over US$110 billion in countries along the Belt and Road; the China Export & Credit Insurance Corporation had provided insurance worth US$320 billion for export and investment programs; nine Chinese banks have established 62 primary affiliates in 26 countries. So far, China has signed currency swap agreements worth over 900 billion yuan with 22 countries in a bid to integrate production capacity cooperation with the yuan’s internationalization.

Fourth, the investment environment has been gradually improved. China has continuously deepened reforms to streamline administration, delegate more powers, improve regulation, and provide better services. It has enhanced investment facilitation and standardized services for Chinese enterprises, urged them to carefully observe the laws of host countries, and guided them to fulfill their responsibilities to society and for the environment. By the end of 2016, China had signed bilateral investment agreements with 53 countries and double taxation avoidance agreements with 54 countries. Negotiations on ISO cooperation agreements, visa facilitation agreements and various other cooperation documents are underway. These efforts have promoted an orderly flow and sound allocation of capital, technologies, personnel and other production resources, cut down enterprise costs in fulfilling administrative procedures, and created a good environment for production capacity and investment cooperation.

At the upcoming forum, President Xi will deliver a keynote speech, and a series of achievements are expected to be made. The National Development and Reform Commission will spare no effort to promote capacity production cooperation, so as to bring more benefits to people living along the Belt and Road.

That's all I want to say at this time.

Xi Yanchun:

Let's thank Mr. NingJizhe for his briefing. Now the floor is open to Mr. Xin Guobin.

Xin Guobin:

Friends from the press, ladies and gentlemen, good morning! First I wish to thank you for your continuous support and concern for China’s development of industry and information technology. Please allow me to give you a briefing on how the MIIT has been working to promote the tasks relating to the Belt and Road Initiative.

First, we have strengthened policy coordination. We actively worked with countries along the Belt and Road concerning their development strategies on industry and communications, and coordinated policies with them. We promoted mutual recognition of industrial standards and explored cooperation potential.

With Russia we signed governmental cooperation documents on civil aviation. With Poland's Ministry of Energy we inked a cooperation deal on new-energy vehicles. With Cambodia, Iran, Bangladesh and Afghanistan we signed MoU on the cooperation in the fields of information and communication technologies. With the five nations in the East Africa Community (EAC), Ethiopia and the International Telecommunication Union (ITU) we signed cooperation deals on jointly building an information superhighway in East Africa. With Cuba's Ministry of Industry, we jointly compiled the long-term development plan of Cuba's industry.

At the same time, we have drafted the "Opinion on the Implementation of the Service from the Standardized work of the Industry and Communication Sectors for the'Belt and Road' Construction," a move to facilitate the mutual recognition of China's standards and those from other countries. In this way, China's advanced technological standards will be introduced to countries along the Belt and Road before serving their local economic development. So far, Ethiopia and Kenya have started implementing Chinese industrial standards on cement and construction ceramics, respectively.

Second, we continued to improve our service systems. We improved interdepartmental working mechanisms with the National Development and Reform Commission (NDRC) and the Ministry of Commerce, among others and established cooperation mechanisms with the National Development Bank (NDB), and the Export-Import Bank of China.

We strengthened contact and communication with key industrial associations and research institutes. We guided the industrial associations for petrochemical, steel, non-ferrous, construction material and communication to form an international alliance for capacity cooperation so as to provide information and consultations to the corporate sector. We promulgated code of conducts for enterprises eyeing the international markets, reduce irregular competition and actively fulfil social responsibilities in countries we invested in.

Third, we coordinated and guided mutually beneficial industrial cooperation. We actively built the docking platforms for the cooperation on international capacity and equipment manufacturing, invited countries along the Belt and Road to participate activities for industrial transfers and dockings and expos for international SMEs. We made most of the bilateral and multilateral mechanisms and organized industrial associations and enterprises to go abroad to facilitate their direct communication and dockings with local companies. In this way we deepened industrial cooperation with countries along the Belt and Road.

So far, in the sectors of raw materials, petrol refinery and agricultural chemicals, overseas projects under construction have a total contract value of US$60 billion. China's non-ferrous sector invested in Russia and Indonesia, among the total 15 countries along the Belt and Road. Enterprises in the construction material sector invested in a total of 33 projects overseas.

In the equipment sector, rail transit, engineering machinery, automobiles - which represent the higher technological level - rushed to invest in countries along the Belt and Road. In the electronic information sector, many PV enterprises invested in the solar power stations in the United States, Japan, Europe, South America and Southeast Asia, or contracted the engineering, procurement, and construction (ECP) package.

Fourth, we promoted the cooperation and construction of industrial parks. We promoted the constructions of China-Laos, and China-Mongolia cross-border cooperation zones, supervised the drafting of development plans of these industrial parks and supported the industrial development and the construction of communication facilities in the parks.

We advanced the constructions of the China-Belarus Industrial Park, the Morowali Tsingshan Industrial Park in Indonesia and the China-Tajikistan Industrial Park. We helped enterprises to know about opportunities for industrial cooperation. We built platforms for investment promotion, conducted investment promotion for the cooperation zones in other countries. We encouraged capable Chinese enterprises with rich experience in industrial park administration to join hands with financial institutions, industrial associations, and intermediate agencies to perfect accommodating facilities in these industrial parks, raise the software and hardware levels and enhance services when these parks are in operation.

Fifth, we accelerated the connectivity of information and communications. We ensured the connectivity of information along the Belt and Road, promoted the popularization of next-generation information and communications technological applications and serve the economic and social development of the countries along the Belt and Road.

We accelerated the construction of international communication accesses. We have established an overall framework of international communications access that mainly consists of comprehensive international gateway exchanges, regional international gateways, border area international communications gateways and international channel gateways. We raised the information and communication capacities in countries along the "Belt and Road."

We vigorously promoted the construction of cross-border cables and continuously improved our information interconnectivity with countries along the Belt and Road. We encouraged telecommunication enterprises to form multinational corporations to enhance their internationalized abilities. Some companies have started overseas operations in Pakistan, Thailand, Singapore, among other countries and regions.

As for our next move, the MIIT will continue with our classified guidance, raise services, perfect safeguarding systems, actively expand new room for industrial development, and promote the deepening of industrial cooperation with countries along the Belt and Road to ensure win-win development. Thank you all!

Xi Yanchun:

Let's thank Mr. Xin for his briefing. Now the floor is open for questions. As per our rule, please identify your agency before raising your questions.