One Belt One Road the way forward for New Zealand
CEO of Bank of China’s New Zealand operation David Wang talks up the prospect of funding infrastructure here as part of a wider ‘One Belt One Road’ investment spree led by the Chinese Government.
I am struck by how many people across the Asia Pacific are talking about the One Belt One Road programme, and by how much collaboration and progress is happening in so many countries through this initiative.
By sharp contrast, in New Zealand, while there has been some media coverage of this ambitious and far-reaching initiative, most people remain unfamiliar with the term One Belt One Road – let alone have an understanding of the project and the opportunity it represents.
China’s President Xi Jinping has called One Belt One Road “the project of the century”, with a vision to spend close to US$1 trillion on trade, cooperation and infrastructure along the old Silk Road trade route from China to Europe over land (the belt) and along China’s maritime shipping routes (the road).
One Belt One Road is about promoting cooperation and working to build a community of shared interests and responsibility. It is underpinned by five main pillars – policy coordination; facilities connectivity; unimpeded trade; financial integration; and people-to-people bonds.
In May, world leaders from more than 100 countries gathered in Beijing to hear China’s plan for One Belt One Road. By the end of the two-day summit, nearly 70 countries and international organisations had signed up. China committed to providing many more billions of dollars of new funding towards One Belt, One Road, with many countries benefitting. Bank of China has promoted the belt and road initiatives and I participated in a number of seminars and financial exchanges with representatives from many One Belt One Road countries, the most recent being a delegation of eight South Pacific countries to our head offices in Beijing and Shanghai in June.
The participants comprised senior government officials, central banks and representatives from financial institutions and large corporations who were there to learn more about One Belt One Road and visit key infrastructure projects and examples of modern agriculture and maritime development.
Bank of China has expended our network to cover 20 countries along One Belt One Road Initiative and actively followed about 420 acquisition and financial projects with an international finance of about US$94.7 billion.
New Zealand has long had a relationship with China that has been hugely beneficial for both countries. New Zealand’s already special connection with China was further sealed in March when Chinese Premier Li Keqiang visited, and the two countries signed a number of agreements signalling further expansion of trade. This included an agreement to strengthen cooperation on the One Belt One Road initiative. And that’s where we can help.
Bank of China has earmarked US$50 billion of funding for One Belt One Road projects over the next three years and we at Bank of China (New Zealand) Limited are keen to explore investment opportunities in infrastructure projects in New Zealand. Of course, we will only fund projects that are viable and will bring real benefits for people and grow the economy. We can offer a value added service to the Government and the rest of the public sector through our connections and services, including access to other funders such as the Asian Infrastructure Investment Bank and the Silk Road Fund.
Another key aspect of One Belt One Road is, of course, trade. Recent trade figures showing an increase in exports to China, and imports from China, have demonstrated how this trading relationship remains key to both countries. Since Bank of China established ourselves in New Zealand in November 2014, we have worked hard to grow this sector.
In the first half of 2017, Bank of China (New Zealand) Limited led a delegation of 15 local New Zealand small and medium-sized enterprises to four cross-border and investment and trade fairs held by Bank of China in Xian, Guiyang, Zhengzhou and Shenyang. The delegation included industries in dairy manufacturing, food and beverage, real estate sales and e-commerce trading.
Through these four fairs, nearly 100 Chinese local enterprises talked with New Zealand enterprises. Two beverage companies have signed their first trade order with Chinese distributors and a memorandum of cooperation was signed between a New Zealand trading company and a company from Henan Province.
I believe if China and New Zealand are to continue to develop their special relationship and reach their goal of NZ$30 billion in two-way trade by 2030, then One Belt One Road is the key to unlocking this unique mutual opportunity.