Hong Kong-listed and headquartered China Merchants Group revealed how to make the best of China’s Belt and Road initiative at a plenary session held at this year’s Asian Logistics and Maritime Conference.
Vice chairman of China Merchants Group, Zhao Huxiang told a packed hall that by being involved in ports, toll roads, shipping, logistics, zone development, real estate and offshore engineering and trade, the company was in a perfect position to take advantage of the wide range of opportunities that were opening up as a result of Belt and Road.
“Unlike in China where the ports are already well developed, ports along the Belt and Road are not,” he said. Mr Zhao said that the company would invest in coastal ports and then add industrial parks and bonded areas. In the last of a third step plan, China Merchants property division would step in to develop the surrounding areas of the ports to establish new port cities.
“We are already investing in a number of ports along the Belt and Road, where the port city concept will be implemented,” he said.
China Merchants intends to invest in at least 10 overseas ports in Russia, Southeast Asia and West Africa. At the same time the recently acquired Sinotrans will connect China Merchants’ ports by rail across Asia and Europe.
DP World’s group chairman, Sultan Ahmed Bin Sulayam, speaking on the same panel, also saw great opportunities on the horizon deriving from Belt and Road, but was concerned that without sufficient funding the project may fall short.
“We believe in China’s One Belt One Road initiative and see huge potential in it, but it is essential that there is a focus on funding, collaboration between nations and innovation for it to be truly successful,” he said.
“The resources required to develop OBOR are vast, with estimates between $2trn and $3trn per year. While government backed financial institutions have been created, there is a need to address the gap between public and private funding.
“At the same time, collaboration is key to harmonise customs processes, develop multimodal connectivity and remove complexities from the global supply chain with policies and procedures that promote cross-border trade and investment.”