GE reaps Belt and Road div­i­dend

China Daily (USA) - - BUSINESS - By CAI XIAO caix­iao@chi­nadaily.com.cn

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. Be­gin­ning to­day, China Daily will present a se­ries of in­ter­views with top ex­ec­u­tives of for­eign com­pa­nies, look­ing at the im­pact of the ini­tia­tive on their op­er­a­tions as well as markets. In the first in the se­ries, John Rice, vice-chair­man of General Elec­tric, looks at the trans­for­ma­tion of the man­u­fac­tur­ing sec­tor.

General Elec­tric’s to­tal or­ders from Chi­nese en­gi­neer­ing, pro­cure­ment and con­struc­tion com­pa­nies are set to top the $2 bil­lion mark this year as a di­rect re­sult of the Belt and Road Ini­tia­tive, said se­nior ex­ec­u­tives of GE.

“The Belt and Road Ini­tia­tive is a multi-win strat­egy be­cause it is sig­nif­i­cant for the eco­nomic growth of coun­tries along the Belt and Road, and the trans­for­ma­tion and up­grad­ing of the Chi­nese man­u­fac­tur­ing sec­tor,” said GE Vice-Chair­man John Rice in Beijing.

Rice saidGE­would­sup­port the Belt and Road Ini­tia­tive and en­deavor to be Chi­nese EPC com­pa­nies’ best part­ner by in­vest­ing in tech­nol­ogy, ser­vices and global re­sources.

This year’s or­ders are al­most three times the amount last year, and around 40 per­cent of the equip­ment will be made in China.

“The Belt and Road Ini­tia­tive is a main rea­son for GE’s growth in or­ders be­cause the na­tional strat­egy brings Chi­nese EPC com­pa­nies and funds to coun­tries along the route,” GE China CEO Duan Xiaoy­ing told China Daily.

GE China an­nounced in June that its strat­egy for the next five years would fo­cus on com­pre­hen­sive lo­cal­iza­tion, help­ing Chi­nese find global part­ners, and reach dig­i­ti­za­tion.

Duan added that GE is trans­form­ing from an equip­ment sup­plier to an in­te­grated so­lu­tion provider. GE will work with Chi­nese EPC com­pa­nies to de­velop the earlystage mar­ket and not only bring equip­ment, but also fi­nanc­ing and op­er­a­tions.

“We have set up a fi­nanc­ing team spe­cially for the Belt and Road Ini­tia­tive,” said Duan.

She said the team would be responsible for ob­tain­ing loans from the Chi­nese govern­ment and banks as well as funds from pri­vate eq­uity in­vestors, and then con­nect these with GE’s project teams around the world.

“We are pos­i­tively seek­ing co­op­er­a­tion with the Asian In­fra­struc­ture In­vest­ment Bank and we hope our first co­op­er­a­tive pro­gram can be reached next year,” said Duan.

Ac­cord­ing to Jay Ire­land, CEO of GE Africa, the com­pany has also set up a $1 bil­lion in­fra­struc­ture fund in Africa to help fi­nance projects on the con­ti­nent.

Ire­land said one-third of Chi­nese EPC com­pa­nies’ equip­ment or­ders with GE this year are des­tined for projects in Africa.

“Africa’s in­fra­struc­ture projects are de­vel­op­ing rapidly ben­e­fit­ing from the Belt and Road Ini­tia­tive,” said Ire­land. “We have close co­op­er­a­tion with Chi­nese EPC com­pa­nies in the elec­tric power, rail­way and health­care sec­tors.”

Duan said thanks to the Belt and Road Ini­tia­tive, Africa is the mar­ket of­fer­ing the great­est po­ten­tial for GE andChi­nese EPC com­pa­nies, fol­lowed by the Mid­dle East, South Asia, South­east Asia and Latin Amer­ica.

He Yafei, for­mer deputy for­eign min­is­ter, said the Belt and Road Ini­tia­tive is be­ing car­ried out to im­prove the global econ­omy and com­pa­nies should un­der­stand the strate­gic mean­ing be­fore seek­ing re­lated op­por­tu­ni­ties.

value that GE’s or­ders from China may reach this year

BLOOMBERG

Em­ploy­ees at the General Elec­tric Co health­care unit’s pro­duc­tion fa­cil­ity work to as­sem­ble med­i­cal X-ray de­vices in Beijing.

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