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Giving full play to the Belt and Road Initiatives

Editor: Li Kun 丨CCTV.com

08-12-2015 16:07 BJT

By Lou Jifang, PhD economics, junior economist, Ministry of Civil Affairs

On September 7, 2013, Chinese President Xi Jinping proposed  the  Belt and Road Initiatives for the first time when he gave a speech at Nazarbayev University, Astana, Kazakhstan.

The Belt and Road Initiatives refer to a trade and infrastructure network that includes the Silk Road Economic Belt and the 21st Century Maritime Silk Road to connect Asia, Europe and Africa. China officially unveiled the ambitious national strategy in March.

The initiatives will provide a new platform for "South-South cooperation", which is an extensive economic and technological cooperation among the developing nations. It will also open a new pattern of cooperation among countries in Asia, Africa, and Europe to promote regional infrastructure construction, freight transportation, and financing.

Nearly 30 provincial governments in China have endorsed the initiatives and have incorporated it into their annual government plans. 

The initiatives already involve 65 emerging economies and developing countries with a total population of 4.4 billion and economic aggregate of 21 trillion US dollars, accounting for 63% and 29% of the total worldwide share respectively.

By the end of 2014, the China Development Bank and countries under the Belt and Road Initiatives have signed contracts valued at over 137.3 billion US dollars, and the number of financing programs has exceeded 400.

China's state-owned enterprises are likely to play an important role.

In 2014, the state-owned enterprises had captured total revenue of 25.1 trillion Yuan, up 3.8% over the prior year, while paying accumulated taxes of 2.1 trillion Yuan, up 4.4% over the prior year, and made accumulated profits of 1.4 trillion Yuan, up 4.2% year on year.

Annual net profits that have been disposed by parent companies of the state-owned enterprises in 2014 stood at 626.92 billion, with an increase of 6.9% over 2013. Of the Fortune global 500 List in 2015, 94 enterprises from the Chinese mainland are recognized, with 47 state-owned enterprises included.

The state-owned enterprises offer extraordinary R & D strength. Statistics show that state-owned enterprise boast one fourth of the nation's R & D institutions and nearly half of its key labs.

The state-owned enterprises have extensive branch offices and rich operating experiences overseas. According to data released by the State-Owned Assets Supervision and Administration (SASAC), by the end of 2014, 107 state-owned enterprises have set up 8,515 branches in more than 150 countries and regions, of which more than 80 have set up branches in countries under the initiatives.

Since the beginning of the 12th Five Year Plan, total overseas assets of the state-owned enterprises have increased from 2.7 trillion Yuan to 4.6 trillion Yuan, with an average annual growth rate of 12.2%. The state-owned enterprises’ overseas assets, revenues and total profits in 2014 accounted for 12.7 %, 18.3% and 8.6% of their gross assets respectively.

The state-owned enterprises have distinct advantages in infrastructure construction, international trade and finance. There are about 100 state-owned enterprises supervised by the State-Owned Assets Supervision and Administration (SASAC) with a wide-business scope: including railways, aircraft manufacture, machinery manufacture, aerospace, power & power grids.

Many enterprises rank at the top class of their sectors. Nearly all state-owned enterprises have gotten involved with overseas investments and engineering businesses. More than half have set up financial subsidiaries, and 11 of which can offer independent financial services.

The state-owned enterprises are great at execution, since they have been the main force of the national economy since the founding of the new China in l949.

They have also performed well in a socialist market-oriented economy under the policies of reforms and opening-up. The state-owned enterprises have strengthened the development of their qualified personnel; while upgrading their management and executions.

The Belt and Road Initiatives are a national strategy for a new situation that gives full play to state-owned enterprises. They have rich resources with substantial strength to provide outstanding services for our neighboring countries.

Additionally, the state-owned enterprises with first-class productions and services can create famous brands for Chinese enterprises to set an image of credibility for the nation.

State-owned enterprises' investment would motivate domestic private enterprises to join the initiatives as well, and guide them to develop localization management in countries involved in the Belt and Road initiatives where they run businesses and to provide employment and investment opportunities for the entire region.

All efforts are essential to promote common development and prosperity for countries working with the Belt and Road Initiatives.

 

( The opinions expressed here do not necessarily reflect the opinions of Panview or CCTV.com. )

 

 

Panview offers a new window of understanding the world as well as China through the views, opinions, and analysis of experts. We also welcome outside submissions, so feel free to send in your own editorials to "globalopinion@vip.cntv.cn" for consideration.

Panview offers an alternative angle on China and the rest of the world through the analyses and opinions of experts. We also welcome outside submissions, so feel free to send in your own editorials to "globalopinion@vip.cntv.cn" for consideration.

 

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