Chinese and British companies anticipate more cooperation in insurance to forestall risks as both sides are set to deepen coordination in projects under the Belt and Road Initiative (BRI), speakers told a high-profile Sino-UK BRI insurance cooperation forum held Monday in London.
London, as a natural partner for the Belt and Road Initiative, has a lot to offer for cooperation with China in assessing project risks and insurance, said Cetherine McGuinness, chairman of Policy and Resources Committee, City of London.
In insurance specifically, the London market is "a leader in innovative product development and has historically embraced insuring new risks," she said.
These innovations include The Joint Code of Practice for Risk Management of Tunnel Works and private markets political risks insurance -- structured to protect equity and debt capital invested through the life cycle of infrastructure projects on a global basis, she noted.
Proposed by Chinese President Xi Jinping in 2013, the Belt and Road Initiative aims to achieve policy, infrastructure, trade, financial and people-to-people connectivity along and beyond the ancient Silk Road trade routes, thus building a new platform for international cooperation to create new drivers of growth.
So far, over 100 countries and international organizations have responded positively to the initiative and pledged their support. More than 80 countries and international organizations have signed cooperation agreements with China.
Yuan Linjiang, Chairman of China Reinurance Corporation, said insurance and assessment of risks are extremely important considering the complexity of political, economic and cultural situations in countries along the Belt and Road Initiative.
Full awareness and prediction of risks are necessary for governments, companies and individuals, said Yuan, adding insurance and reinsurance are the best ways to divert and minimize risks of projects.
Yuan also called for the establishment of a joint insurance mechanism to deflect major risks as a single company may not be able to cover the giant projects under the initiative with enormous investment and long construction period.
Seeing the potential for cooperation, Inga Beale, CEO of Lloyd's of London, the world's leading insurance market agreed that insurance would help build resilience in projects under the initiative. Lloyd's of London provides specialist insurance services to businesses in over 200 countries and territories.
There remains risks and a global insurance gap that threatens the resilience of both developing and emerging markets ranging from natural disasters to cyber attacks, she said.
Lloyd's stands ready to support the many Belt & Road projects going on across the world by providing the insurance and reinsurance products and expert knowledge, she said.
China is one of Lloyd's most important markets and Belt and Road Initiative offers unprecedented opportunities, said Beale, noting that the company's decision to set up a branch in China 11 years ago was ground-breaking and significantly fostered the company's growth.
Even though Lloyd's has been at the forefront of the sector for more than 300 years, pioneering new forms of protection for a rapidly changing world, it needs Chinese companies which understand both markets to lead on the collaboration, she said.
As a major outcome reached at the China-UK Economic and Financial Dialogue (EFD) early this year, China and Britain proposed a bilateral investment fund with the first round of 1 billion U.S. dollars to support the initiative.
In a bid to support British businesses' involvement in the initiative, the British government recently pledged up to 25 billion British pounds (33.3 billion dollars) worth of financial support for companies participating in the Belt and Road projects in Asia.