LONDON, July 6, 2017 /PRNewswire/ -- Advisor to China's ambitious Belt & Road Initiative (BRI) Professor Yang Jiemian says China and the UK have a lot to gain by working together on the BRI, especially if they tie in existing projects from their two countries and other parts of the world while leveraging the mutual benefits and complementary strengths of both countries. "The BRI could garner the best possible outcome only by [aligning] with each other's plans such as the British Northern Powerhouse, Germany's Industry 4.0 strategic initiative, [along with major road projects in places such as Kazakhstan, Mongolia, etc.]," he said today at a CEIBS-hosted forum looking at China's outbound investments and opportunities for Britain. "China and Britain could reap the benefits by expanding their coordination with the programmes of other BRI participants," he added.
The BRI will see major projects in countries along its route and beyond. As noted in a joint communiqué issued after the May 15 Leaders Roundtable in Beijing, the BRI will enhance connectivity between Asia and Europe and is also open to other regions such as Africa and South America. With government level support from many countries, the actual implementation of projects has seen widespread participation at the company level. According to data from China's Ministry of Commerce, between January and April of this year Chinese companies in 61 countries along the BRI signed 1,862 contracts. The value of newly inked deals was US$31.85 billion, an increase of 2.3% over last year.
During today's event, Professor Yang - who is also President Emeritus of Shanghai Institutes for International Studies - told the audience of business executives from both countries how China and Britain stand to benefit from leveraging each other's resources. "China and Britain are two important global players and complement each other in many ways. Britain's strength in finance, innovation, education and culture will add irreplaceable value to the BRI and Britain will gain enormous benefits in return," he said. "As an integrated driving force, the BRI would demand - as well as promote - greater cooperation in institution-building, rule-making, advanced research and closer networking."
His comments come at a time when post-Brexit Britain is unwinding years of agreements with the EU, and there is some degree of uncertainty about just how hard of a landing this will be. Concerns, ahead of the Brexit vote, about the economic fallout of leaving the EU are still being assessed; but so too are the potential opportunities when trade deals are renegotiated. For now, the BRI in post-Brexit Britain has the attention of firms such as Deloitte Touche Tohmatsu Services, Inc. "[With respect to the BRI], from 2016 to 2021 the UK plans to invest more than GBP 100 billion in infrastructure. Therefore, we have engaged with Chinese EPC contractors, funds and developers in teaming them up with local players, educating them on the market and helping them to win contracts," said company Vice Chairman Angus Knowles-Cutler.
Providing Chinese firms with the know-how needed to succeed in the UK market is a potentially lucrative deal for Deloitte and other firms that can offer expertise on anything from legal advice to logistics support. China's foreign direct investments have grown steadily since 2002 with major M&As in Europe such as the US$43 billion ChemChina-Syngenta deal and China Investment Corporation's US$13 billion grab of Logicor making the headlines. There have also been some headline grabbing failures as well, and there will likely be more in the future. According to CEIBS Vice President & Dean Professor Ding Yuan, some deals will fail because some companies are going global for the wrong reasons. They may be liquidity-driven, responding to political signals or are simply being opportunistic by chasing short-term gain, he said. Globalisation, he stressed, should not be the end game but simply one of the pillars of a firm's overall strategy. He was citing research from CEIBS Centre for the Globalisation of Chinese Companies.
Other Chinese companies, Dean Ding noted, would fail at executing their globalisation plans because they are over confident and over optimistic so they pay too much; or they simply lack the management skills required to succeed. This year, CEIBS began offering a course for Chinese business executives eying the global market or already operating internationally. Events like today's London leg of CEIBS 3rd Europe Forum 2017 also provide useful insights for business executives, as well as bridge the gap between China and the rest of the world. "Our aim is to provide a platform that can integrate business resources on both sides and promote cooperation between Chinese and UK companies," explained CEIBS President Li Mingjun. "It is our hope that our discussions will help foster greater understanding and collaboration between China and the UK, between companies and between people."
The CEIBS 3rd Europe Forum 2017 series of events continues in Paris on July 11.
About China Europe International Business School (CEIBS)
CEIBS (www.ceibs.edu) is the leading international business school in mainland China. It is the only business school in Asia to have simultaneously made it to the Financial Times' top 30 list of MBA, EMBA and Executive Education programmes. CEIBS' world-class faculty - from both China and abroad - are experts in their fields. Since its launch in 1994, CEIBS has provided management education to over 130,000 executives both at home and abroad. CEIBS has campuses in Shanghai, Beijing, Zurich and Accra and a teaching centre in Shenzhen. Its more than 19,000 alumni are spread across 80+ countries around the world.