Strengthening global infrastructure
NORINCO to expand its footprint in mines, power grids, commodities
China North Industries Group Corp, a State-owned company that makes hightech products for both defense and civil sectors, plans to increase resource allocation for more visibility in global markets.
This it intends to accomplish by participating in global-scale events like the China International Import Expo that was held in Shanghai from Nov 5 to 10.
It also aims to leverage the Belt and Road Initiative to further compete with established foreign rivals in areas like mines, power grid construction and trading in commodities.
Executives of China North Industries, which is also known as NORINCO, the international arm of parent NORINCO Group, said opportunities to expand come from many countries’ growing demand for manufacturing, infrastructure and energy development projects, especially in fast-growing markets such as Pakistan, Myanmar, Namibia, Brazil and the United Arab Emirates.
Such countries are focused on sustainable development against a backdrop of urbanization and industrialization. Their services and communication sectors are growing rapidly too, they said.
Zou Wenchao, vice-president of NORINCO Group, said China’s new measures to support multilateralism and deep involvement in the Belt and Road Initiative will help facilitate both goods and service trade activities, as well as infrastructure construction in many parts of the world, and enable stronger connections with China.
The Beijing-headquartered group has organized more than 10 business meetings and signing ceremonies during the first CIIE in Shanghai, in areas like high-end manufacturing, minerals, materials, agricultural and chemical product development.
It also formed new partnerships with capable global companies to jointly develop third-party markets, particularly in economies related to the BRI.
During the CIIE, NORINCO sealed the deals with governmental and business partners such as Guinean State Mining Co, Myanmar Economic Holdings Co, and other firms from Sudan and the United States to import cotton, copper, cobalt, bauxite and automobile lubricant oil to meet the demand of China’s ongoing industrial and consumption upgrades.
NORINCO won a $145 million, five-year service contract for the second phase of blasting and safety management projects in Husab uranium mine in Namibia last month to support the country’s economic growth.
With $5 billion of investment by Chinese companies such as China General Nuclear Power Corp, the Husab uranium mine project currently is China’s largest investment in the mining industry in Africa. Construction work started in 2013 and was completed at the end of 2016, and the mine has now entered its operating period.
“Winning this bid fully demonstrates the core competitiveness of our ability in the area of civil explosion in international markets and has generated great momentum to speed up NORINCO’s pace of internationalization for conducting explosion projects in both military and civil sectors,” said Zhi Yulin, president of NORINCO and assistant general manager of NORINCO Group.
“As NORINCO has developed a worldwide operational network with stable growth in defense products, petroleum, mineral resources, international economic and technical cooperation, and operation of civil products, the project will further support our group’s ‘ go-global’ strategy, as well as improve sales of China’s military and civil products in more global markets.”
By the end of August 2017, NORINCO had invested in 42 projects in 23 countries and regions including Myanmar, Iraq, Kazakhstan and Laos, with a cumulative total amount of $5.49 billion.
Letpadaung copper mine, a mine invested in and operated by NORINCO in northwestern Myanmar, reported earlier this year that its copper production capacity exceeded 10,000 metric tons a month, building a solid foundation to reach the annual target of 100,000 metric tons for 2018.
“The development of Letpadaung project has provided a major financial boost for the local government and the surrounding area over the past three years, bringing in millions of dollars and providing thousands of jobs and social welfare,” said Zhi.
The Letpadaung copper mine’s work started in 2015 and its operation turned out to be a major success for the regional economic growth. In 2016, the mine produced a total of 20,000 tons of cathode copper and had helped local government to earn more than $14 million in revenue.
“China’s proposal to explore third-party market cooperation could bring benefits to both Western nations and developing countries involved in the Belt and Road Initiative, without causing a clash of interests,” Zhi said. “Projects involving China, France and some Frenchspeaking African countries are a case in point.”
NORINCO also completed two transmission line projects in Laos in September to meet the demand of the country’s National Grid Plan for 2016-20.
It is designed to bring convenience and provide electricity to the northern and central provinces of Laos. It is also a milestone project of both sides actively promoting China-Laos economic cooperation in response to the Belt and Road Initiative.
China’s centrally-controlled State-owned enterprises have been a major force driving the Belt and Road Initiative, with their respective projects, said Li Jin, chief researcher at the China Enterprise Research Institute.
“Widening the international channels and construction project network can help Chinese equipment, infrastructure and service providers enhance their localization abilities, as well as gain support via local employment,” said Li.
Kazakh workers and engineers participate in the opening ceremony of a carbon dioxide treatment plant jointly built by NORINCO in Kazakhstan.
Employees from NORINCO work at a pipeline project on the site of the al-Ahdab oil field in Iraq.