Carrier sets goal of $1b investment China Telecom said plans to build cables and internet data centers
The World Bank Group and the China-led Asian Infrastructure Investment Bank signed an agreement on Sunday to strengthen cooperation and knowledge sharing between the two multilateral financial institutions.
World Bank President Jim Yong Kim and AIIB President Jin Liqun signed the memorandum of understanding during the 2017 IMF/World Bank annual spring meeting in Washington.
The deal provides an overall framework for cooperation between the World Bank and the AIIB in a wide range of areas, including development financing, staff exchanges and analytical and sector work. It paves the way for the two institutions to further enhance coordination at the regional and country levels, according to a World Bank news release.
“The World Bank Group has worked closely with our partners at the Asian Infrastructure Investment Bank since its inception,” Kim said.
“We’re already financing projects together from Azerbaijan to Indonesia, and I’m delighted to further strengthen our partnership. Collaboration between development institutions is essential to make the best use of scarce resources, bring in the private sector, and meet the rising aspirations of the people we serve,” Kim added.
The two institutions signed a co-financing framework agreement for investment projects a year ago. Since then, the AIIB and the World Bank have co-financed five projects: supporting power generation in Pakistan, a natural gas pipeline in Azerbaijan, and slum upgrading, dam safety and regional infrastructure development in Indonesia. The two institutions are discussing more projects to be co-financed in 2017 and 2018.
The AIIB and the International Finance Corporation, a member of the World Bank Group, have co-invested in a power sector project in Myanmar and are discussing additional potential projects.
“Signing this memorandum of understanding fits into our vision of a new kind of internationalism,” Jin said.
“It deepens our relationship with the World Bank Group and sets up the mechanisms through which we can more easily collaborate and share information. We place a high value on our partnerships because by working together, we greatly increase our potential for positive outcomes in Asia,” Jin said.
Unlike the less than supportive attitude expressed by former US president Barack Obama’s administration, World Bank President Kim and IMF Managing Director Christine Lagarde have expressed their support for the AIIB since the very beginning.
The Beijing-based AIIB opened for business in January 2016 with the aim of supporting infrastructure construction in the Asia-Pacific region.
According to statistics published at the end of March, it had 52 members and another 18 prospective members.
James Woolsey Jr, a former director of the Central Intelligence Agency and former adviser to President Donald Trump’s campaign, indicated earlier that the Trump administration might be interested in joining the AIIB, but no senior Trump administration official has given any clear signal on the issue so far.
China Telecommunications Corp said on Monday that it will invest more than $1 billion over the next three to five years to expand its presence in economies along the Belt and Road Initiative.
Deng Xiaofeng, CEO of its international unit China Telecom Global Ltd, said it will also raise more money from State-owned financing institutions and private investors, in a move to build land cables, internet data centers and other infrastructure in Southeast Asia, Europe and other regions.
“State-owned and private capital are now keen to be part of our efforts. We also need their expertise to help us evaluate whether the plans are plausible,” Deng added.
Deng said the company did not exclude the possibility of investing in foreign telecom carriers to help other developing countries accelerate the development of 4G. But Deng did not disclose more details.
As of 2016, China Telecom has more than 4,700 overseas employees, with branches and offices in 30 countries and regions, most of which are along the Belt and Road. It has already built 13 internet data centers in six of them.
Deng said it would step up resources to complete four cross-border telecom infrastructure initiatives, including the China-Pakistan information corridor, the China-Laos-Thailand and the China-Bangladesh-Myanmar-India projects.
“Cross-border telecommunication infrastructure is one of the first steps for international cooperation,” he said.
“Our experience in deploying one of the world’s
State-owned and private capital are now keen to be part of our efforts.” Deng Xiaofeng, CEO of China Telecom Global Ltd
largest information networks in China can help narrow the digital gap.”
According to data from the International Telecommunication Union, the AsiaPacific region scored 4.58 in informatization level in 2016, lower than the global average of 4.94.
Xiang Ligang, a telecom analyst and founder of the telecom industry website cctime.com, said China Telecom was one of the first Chinese telecom carriers to go global, with the push starting in the 1990s.
“Its expansion plans will also help more Chinese telecom equipment makers venture into overseas markets,” Xiang said.
China Telecom expects that China’s plan to help economies along the Belt and Road improve telecom services will create a market worth $10 billion to $20 billion for the telecom industry over the next five years.
China Telecom’s plan came shortly after its bigger rival China Mobile Communications Corp said last week it would build two telecom systems to facilitate China’s ties with Laos and Myanmar.
China Mobile on Monday, however, denied a report that it was considering buying shares of Singapore telecoms company M1 Ltd.