Cater­pil­lar seeks to deepen ties with Chi­nese com­pa­nies

China Daily (Hong Kong) - - BUSINESS -

Ed­i­tor's note: Three years ago, Pres­i­dent Xi Jin­ping launched China’s am­bi­tious Belt and Road Ini­tia­tive, to link vast transcon­ti­nen­tal swathes with a com­mon eco­nomic thread. The ini­tia­tive brought un­prece­dented op­por­tu­ni­ties to com­pa­nies world­wide to ex­pand their busi­ness and ac­cess new mar­kets. China Daily presents a se­ries of in­ter­views with top ex­ec­u­tives of for­eign com­pa­nies, look­ing at the im­pact of the ini­tia­tive on their op­er­a­tions as well as mar­kets. Chen Qi­hua, chair­man of Cater­pil­lar China, ex­plains how the US ma­chin­ery man­u­fac­turer proposes wider co­op­er­a­tion with Chi­nese com­pa­nies on projects in the Belt and Road coun­tries.

US ma­chin­ery man­u­fac­turer Cater­pil­lar Inc proposes wider co­op­er­a­tion with Chi­nese com­pa­nies on projects in Belt and Road coun­tries to fully uti­lize its long-stand­ing global deal­er­ship net­work, ac­cord­ing to its top ex­ec­u­tive in the Asia-Pa­cific re­gion.

“The unique ad­van­tage of Cater­pil­lar is that it has had a pres­ence in var­i­ous coun­tries for years. While prod­ucts can be repli­cated, re­la­tions and trust with lo­cal agents are hard to copy,” said Chen Qi­hua, vice-pres­i­dent of Cater­pil­lar Inc and chair­man of Cater­pil­lar China.

Cater­pil­lar, which has a pres­ence in more than 180 coun­tries and re­gions, has been do­ing busi­ness world­wide for more than 90 years. More than 59 per­cent of its rev­enue cur­rently comes from mar­kets out­side the United States.

“With a so­phis­ti­cated global net­work, we are quite fa­mil­iar with lo­cal mar­kets, cul­tures and gov­ern­ments. In this re­gard, we are able to of­fer al­laround pro­fes­sional con­sul­tancy to Chi­nese com­pa­nies who want to tap into lo­cal

mar­kets,” said Chen.

The Belt and Road Ini­tia­tive cov­ers 63 per­cent of the global pop­u­la­tion and 30 per­cent of its eco­nomic out­put.

Ac­cord­ing to The Global Com­pet­i­tive­ness Re­port (201415) re­leased by The World Eco­nomic Fo­rum, 27 of the 60 coun­tries in the ini­tia­tive have in­fra­struc­ture be­low the global av­er­age level.

The Asian De­vel­op­ment Bank has es­ti­mated that Asian coun­tries need at least $8 tril­lion in in­fra­struc­ture con­struc­tion be­tween 2010 and 2020 if they are to reach the global av­er­age level.

Mean­while, China’s over­seas di­rect in­vest­ment stood at $145.7 bil­lion in 2015, the first time it ranked sec­ond glob­ally next to the United States. It was also the first time that the na­tion’s out­bound in­vest­ment sur­passed its cap­i­tal in­flow, mak­ing China a net

ex­porter of cap­i­tal.

“China’s out­bound in­vest­ment has evolved from pure project con­tract­ing to a com­plete pack­age en­com­pass­ing fi­nanc­ing, con­struc­tion, lo­cal­iza­tion, sus­tain­able de­vel­op­ment and risk man­age­ment. There­fore, it needs more di­ver­si­fied busi­ness mod­els to do busi­ness over­seas,” said Chen.

Cater­pil­lar has ex­pe­ri­ence in di­ver­si­fied busi­ness mod­els for in­fra­struc­ture con­struc­tion, in­clud­ing pub­lic-pri­vate partnerships, build-op­er­ate­trans­fer and fi­nan­cial leas­ing. Its fi­nan­cial ser­vices com­pany has of­fices in more than 40 lo­ca­tions in the Amer­i­cas, Asia, Aus­tralia and Europe, serv­ing clients in 98 coun­tries and re­gions, help­ing clients to pur­chase equip­ment which is oth­er­wise not avail­able.

One of its land­mark projects was the ren­o­va­tion of the 77-kilo­me­ter M5 Zhrobin-Bob- ruisk ex­press­way in Be­larus by China Com­mu­ni­ca­tions Con­struc­tion Com­pany Ltd, which has a to­tal con­tract value of close to $400 mil­lion. Cater­pil­lar sup­plied ma­chin­ery, train­ing and main­te­nance ser­vice for the project, which was com­pleted in July this year.

Zhang Quan­sheng, vi­cepres­i­dent of Cater­pil­lar China, said that sus­tain­able de­vel­op­ment is key to cre­at­ing val­ues for lo­cal com­mu­ni­ties.

In or­der to help safe­guard the en­vi­ron­ment, Cater­pil­lar has in­tro­duced a Zero Dis­charge sys­tem to dis­pose of and re­use the waste wa­ter at its fac­tory in Batam, In­done­sia. The waste wa­ter is used for land­scape main­te­nance of the venue, sav­ing 3.8 mil­lion liters of wa­ter an­nu­ally, equiv­a­lent to 24 years of wa­ter con­sump­tion for an av­er­age fam­ily of four in the South­east Asian na­tion.

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.