Actors perform in song and dance drama Colorful Western Region. [Photo provided to chinadaily.com.cn]
China's well-funded Belt and Road Initiative has rolled out with thousands of Chinese enterprises going all out in the vast, new market created by participating countries and beyond. The vast overseas market will become a giant pool of capital, with trillions of dollars of overseas investment and financing in the coming years, experts projected.
Chinese investments overseas have been growing at a double-digit rate over the past 10 years. By 2016, some 30,000 Chinese companies have marched overseas, with a total investment of $1.2 trillion, including outward foreign direct investment at $183.2 billion. In five years, that figure is expected to rise to $750 billion, revealed Zhou Xiaofei, a director at National Development and Reform Commission (NDRC).
Zhou made the remarks at the "Chinese Firms Going Abroad 50 Forum," organized by the Counselors' Office of the State Council. The forum was contracted to the Center for China and Globalization (CCG).
Zhou also pointed out that private companies make up some 60 percent of the Chinese companies in the foreign market, though many are inexperienced newcomers compared to their overseas counterparts.
"The NDRC has streamlined the application process to facilitate Chinese companies' overseas investment. Most investments only require a record on file, with no lengthy verification procedure," Zhou said. "The NDRC will continue to encourage Chinese companies to go overseas and negotiate and cooperate with participating countries along the B&R to bring down the cost of cooperation. Efforts will also be made to improve overseas security and to lower operational risks."
Zhang Xingfu, a deputy head of a department responsible for outward investment and economic cooperation under the Ministry of Commerce, told the forum that more than 70 percent of the Chinese companies overseas are profiting. By 2016, a total of 77 projects have taken shape in 36 countries and regions with total investment of $24.19 billion. These Chinese-led projects will add more than $70 billion in value and create over 212,000 jobs.
"China will continue to outshine others at a time when the developed countries are expected to remain mired in economic stagnation," said Justin Yifu Lin, former World Bank chief economist, at the forum, adding that China's economy will remain robust and serve as the world's economic engine.
Behind the growing prosperity are a number of Chinese financial institutions that have been providing constant support to the companies.
According to Sun Ping, vice president of the Export-Import Bank of China, the bank has supported a total of 1,279 Belt and Road projects, with the loan balance exceeding 671.4 billion yuan, up 18.28 percent.
Meanwhile, the total investment of projects supported by the Silk Road Fund has topped $80 billion, said the fund's executive vice president Ding Guorong. "We should be aware that the financing demand in the Belt and Road construction is huge. The demand cannot be met by the fund or any single Chinese financial institution," Ding noted, adding that the Silk Road Fund has established cooperative ties with a dozen international financial institutions on possible bilateral or multilateral cooperation opportunities.