Financial agencies assume vital roles on Belt and Road

Updated: November 8, 2017 Source: Belt and Road Portal
fontLarger fontSmaller

In the report he delivered to the 19th National Congress of the Communist Party of China in Beijing on Oct. 18, CPC Central Committee General Secretary Xi Jinping highlighted the Belt and Road Initiative's role in promoting China's opening-up. China's financial sector views the Belt and Road Initiative as a platform to secure more business opportunities in win-win cooperation and opening-up, People's Daily Overseas Edition reports.

The Party committee of the Ministry of Commerce points out in an article jointly authored by its members that the Belt and Road Initiative construction, as a large undertaking and top-level institutional design of China, is conducive to forming a global network of trade, investment, financing, production and services, advancing China's opening-up to a higher level and enriching its contents.

Experts say finance will play a key role in bridging the gap between infrastructure demand and lack of funding in the countries along the Belt and Road routes. The development of China Construction Bank in recent years is a case in point.

After 2013, CCB opened branches in Russia, Indonesia, Poland and Kazakhstan, all important countries on the Belt and Road. It has increased its credit support to key projects related to the Belt and Road, and is actively engaging in cross-border trade, investment, acquisition, innovation while strengthening its risk management and control mechanisms. 

Foreign banks are also utilizing the opportunity of the Belt and Road. By the end of August, 5 banks, 13 branches and 11 representative offices of 15 countries along the Belt and Road routes have been established in Shanghai, with the total assets of the banks from countries related to the Belt and Road Initiative reaching212.2 billion yuan (US$32 billion), up 49 percent year-on-year, accounting for 14 percent of the overall assets of foreign banks in Shanghai.   

China's financial agencies are playing active roles behind the implementation of a series of projects on the Belt and Road, and the increasing flow of commodities, factors and talents along the Belt and Road, experts say.

China Export & Credit Insurance Corporation is helping Chinese investors and banks to manage their financial risks in the hydropower project in Cambodia through investment insurance and investment in project stock rights and creditor’s rights.

The Industrial and Commercial Bank of China signed a cooperation agreement with Hunan Construction Engineering Group to serve as a coordinator in the latter's foreign projects. The agreement works well in HCEG’s projects in Africa, Southeast Asia and Central and Eastern Europe.

ICBC also cooperates with banks from the other countries to launch a Belt and Road bank cooperation action plan, making it a normalized exchange and cooperation mechanism to utilize financial services in deepening pragmatic cooperation.

China Development Bank has loaned US$74 billion to Belt and Road projects in the past five years, mainly supporting infrastructure facilities, industrial cooperation, energy and resources and people's livelihood.

China's financial agencies are providing the badly-needed funding to the countries, where the Western-dominated financial agencies are reluctant to invest. That is a testimony to China's commitment for win-win cooperation and common development. More banking, security and insurance agencies are expected to be involved in the Belt and Road projects in the foreseeable future, analysts say.

Editor: zhangjunmian