Rachel Duan, president and CEO of GE Greater China (shisu.edu.cn)
GE China has taken a strategy of joint market development, joint investment and financing, and joint operations with the Chinese Engineering Procurement Construction (EPC) companies, aiming to establish the long-term strategic cooperation with the EPC companies in China and become an entity to jointly build the Belt and Road, so as to undertake risks together and share profits, said Rachel Duan, president and CEO of GE Greater China, in an exclusive interview with Xinhua.
--- B&R Initiative brings tangible benefits to countries and regions along the routes
Since the Belt and Road Initiative was proposed, multinational corporations have become an important force in participating in the construction.
“GE has a history of 126 years. Today, more than 60 percent of its business revenue comes from outside the United States. A global company like GE has taken great social responsibility.” said Duan, adding that “by participating in construction of the projects under the Belt and Road, we see or can foresee that the initiative will bring tangible benefits to the people of the countries and regions along the routes and improve their lives.”
So far about one billion people around the world have not been able to use electricity. In many countries, electricity resources are scarce. For example, up to 80 percent of the population in Kenya does not have access to electricity. The Kipeto WindFarm project which was jointly built by China National Machinery Industry Corporation (Sinomach) and GE can help double the population of electricity consumers in Sub-Saharan Africa. The Bhikki combined-cycle power plant in which GE participated is a large-scale power plant project in Pakistan and will provide stable electricity to 4 million households, according to Duan.
Duan said that GE believes that the Belt and Road Initiative can benefit the people of countries and regions along the routes, and the improvement of infrastructure will benefit the economic growth of these countries and regions.
--- B&R Initiative brings "point-to-area" improvement
GE and Chinese overseas EPC companies, such as Sinomach, Power Construction Corporation of China, China Energy Engineering Group Co., Ltd and Harbin Electric International Co., Ltd. (HEI), have more than 20 years of cooperation, providing technical support and services for more than 70 power infrastructure projects in Africa, the Middle East, South America and Europe, according to Duan.
“However, previous cooperation used to be operated separately on a single project, or “a point”. Now these cooperation connects one another and form “an area” under the Belt and Road Initiative,” Duan said.
In the past three years, GE participated in Belt and Road projects including Pakistani Bhikki combined-cycle power plant project, the CPHGC Coal-fired Power Project in Pakistan, Dubai’s Hassyan Clean Coal Independent Power Project, and the Kipeto WindFarm project in Kenya.
Since the launch of the Belt and Road Initiative, GE’s orders from the Chinese EPC companies have jumped from 400 million U.S. dollars in 2010 to 2.5 billion U.S. dollars in 2017.
“Single overseas infrastructure projects sometimes encounter multiple challenges. Some of the power infrastructure projects are transnational which is very difficult if we rely on construction companies alone.” Duan said, “We have seen Chinese government’s efforts under the Belt and Road Initiative such as raising dialogues to national level and inputting funds, which brought real changes to the situation."
In November 2017, GE's energy investment division and Silk Road Fund jointly invested 500 million U.S. dollars to set up a joint investment platform which will mainly invest in the form of equity in the green energy fields of countries and regions along the Belt and Road routes.
“This is an important manifestation of changes from the point to the area, changing the previous practice of separate financing to build a unified financing platform. I think this is a breakthrough in the industry.” Duan said.
--- Trend of "joint market development, joint investment and financing, and joint operations”
GE China has established a strategy of "joint market development, joint investment and financing, as well as joint operations" with the Chinese EPC companies.
“We are expected to break the previous cooperation model of general contractors and suppliers, serve the entire life cycle of projects via the 'three joint efforts', and build an ecosystem for the Belt and Road projects,” Duan noted.
GE will definitely consider risks, but only from the perspective of the project's entire life cycle and ecosystem, said Duan, adding that the comprehensive evaluation of the complexity, risk, as well as input and return of the project can be seen more clearly.
In addition, GE believed that the Belt and Road projects not only encompassed equipment sales opportunities, but also generated a series of returns in areas such as financing services, ancillary equipment, follow-up services, and future operations.
"GE is willing to carry out comprehensive and in-depth cooperation with China's EPC companies via joint market development, joint investment and financing, and joint operations, and jointly advance the Belt and Road Initiative.” Duan said.
GE is a world-renowned digital industrial company, and its core business not only focuses on the infrastructure fields, such as aviation, medical, power generation, renewable energy, energy interconnection, oil and gas, transportation and lighting, but also includes cross-domain digital and financial services. GE's business currently covers more than 180 countries and regions in the world. In 2016, the company’s global revenue reached 123.7 billion U.S. dollars.