15 May 2019

 

Policies targeting key priority areas have been instrumental in China’s economic transformation over the past 40 years, according to HSBC Group Chairman Mark Tucker.

Mr Tucker was speaking at the sixth annual HSBC China conference in Shenzhen – a city that embodies the impact of targeted policies. Shenzhen’s Special Economic Zone was first established in the 1980s to stimulate private-sector businesses. It has helped the city grow from a small fishing village into “a bustling metropolis…and the birthplace and home of China’s leading tech companies,” Mr Tucker said.

Other policies supporting the country’s continued development include opening up China’s capital markets, the Greater Bay Area and the Belt and Road Initiative, according to Mr Tucker.

The Greater Bay Area is designed to foster closer economic ties between Hong Kong, Macau and cities in mainland China including Guangzhou and Shenzhen. The Belt and Road Initiative supports increasing cross-border trade and investment between China and more than 100 other countries.

Meanwhile, moves to open up China’s markets mean that companies and investors from around the world will benefit from the country’s expansion, Mr Tucker said. He added that HSBC was ready to support its clients to make the most of these opportunities.

 

Read the full speech: How targeted policies have facilitated China’s opening up and development

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By Mohamed Salama, Country Head of Global Banking, UAE, Standard Chartered

 

SUMMARY

The UAE features prominently as a key component of China’s trade strategy in the AME region, as 60% of China-UAE trade is re-exported to Africa or Europe, thus supporting the Belt & Road Initiative’s mandate.

Please click HERE to read more.

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As a key link for the Belt and Road, Hong Kong boasts multiple advantages for doing business in Asia and beyond, featuring top-ranked international expertise in a full spectrum of legal, financial, and professional services, an independent judiciary, and a safe, stable, international, culturally rich and business-friendly environment that continually attracts top global talent.

 

Hong Kong enjoys an ideal location as a gateway to and from China. World-class construction and logistics engineering have improved and amplified Hong Kong’s natural advantages: its deep-water port has developed into one of the world’s busiest; and every major city in Asia lies within a five-hour radius by air, with flights departing and arriving at the world’s busiest cargo airport. The public transportation network is efficient, extensive and constantly expanding, enabling one of the most integrated social and commercial living spaces on the planet.

 

All this has come about thanks to Hong Kong’s vital role in connecting the Chinese mainland to the rest of the world, first through trade (still one of the city’s main economic engines), and ultimately, in its unique position as Asia’s international financial centre.

 

Geographically, Hong Kong is the spot where the inland Belt intersects with the maritime Road. It is also the anchor of the Guangdong-Hong Kong-Macau Bay Area, a macro-region with a population of close to 70 million and a GDP of US$1.5 trillion.

 

All of these advantages and strengths make Hong Kong a natural partner in the Belt and Road Initiative; but what really stands out is the solid legal and financial platform on the one hand, and the quality of Hong Kong’s professional services practitioners on the other.

 

In his opening remarks at the luncheon plenary of the Belt and Road Summit held in Hong Kong this June, Financial Secretary of the Hong Kong Special Administrative Region (HKSAR) Paul Chan highlighted the breadth and excellence of Hong Kong’s professional services, saying that Hong Kong is “strategically positioned to serve as multiple service platforms for the Belt and Road.”

 

Chan elaborated on the scope of top professional services available, with application to nearly every phase of the typical Belt and Road infrastructure construction project: “Our world-class professionals in engineering, architecture, urban planning, surveying and consulting have the experience and knowledge to lead Belt and Road projects. . . . Legal, regulatory and political risks can undermine the feasibility of a project, and risks in construction and cost overruns will negatively impact a project’s profitability. Hong Kong’s deep pool of multicultural talent in law, accounting and finance can help manage these risks.”

 

Chan also touched on one of the most important and unique advantages offered: that Hong Kong is the perfect locale for resolving Belt and Road business disputes, with arbitral awards enforceable in more than 150 jurisdictions, including the Chinese mainland.

 

It is also important to have experts, licensed mediators and arbitrators with specialised knowledge and experience pertinent to the Hong Kong context. That means professionals like Mary BL Thomson, a mediator, arbitrator and solicitor with more than 20 years of experience with the Hong Kong Maritime Arbitration Group. Thomson pointed out that, for example, since 90% of all goods will be transported by sea, the Belt and Road Initiative would do well to study maritime disputes, which comprises an important set of precedents in commercial law.

 

William Wong, Chairman of the Committee on Arbitration and Chairman of the Committee on International Laws of the Hong Kong Bar Association, extolled the independence of Hong Kong’s judiciary as its greatest advantage in dispute resolution.

It is important that Hong Kong be specified in contracts as the venue for resolving potential disputes—the “champagne clause,” as explained by Teresa Cheng Yeuk-wah, Secretary for Justice of the HKSAR. Hong Kong’s implementation of common law, along with its independent judiciary, foster confidence on the part of investors and stakeholders.

 

Cultural as well as systemic legal differences come into play when the parties making the deal or settling the dispute hail from different countries and cultures. A presentation by Amirali B. Nasir, Founding Principal of Nasirs and Vice President of the Law Society of Hong Kong, reminded Summit participants that Hong Kong has, significantly, modified its laws to allow Islamic financial instruments such as sukuks (Islamic bonds), and there is expertise here to advise companies operating in Muslim countries.

 

Hong Kong is a top centre for international dispute resolution. Belt and Road projects can benefit from agreeing to settling disputes on neutral ground, where impartiality is guaranteed and the quality of service is unparalleled. The arbitration and mediation industry in Hong Kong is comprised of highly-specialised and experienced professionals, practitioners and advisory organisations. In 2017, the most recent year for which data is provided, the Hong Kong International Arbitration Centre (HKIAC) carried out 532 cases, of which 297 were handled by arbitration, 220 were domain name disputes, and 15 were mediation disputes, with an aggregate value of close to HK$40 billion. Cases ranged from corporate and finance, maritime and international trade to construction and professional services disputes.

 

On the subject of operating across different jurisdictions and legal systems, Hannah Ha, Partner at Mayer Brown, pointed out that one can easily find lawyers in Hong Kong with knowledge and experience in multiple jurisdictions, including those of Belt and Road countries.

 

Hong Kong is a centre of excellence for accounting and taxation as well. Apart from access to a large pool of practitioners familiar with multiple regions and systems, one advantage of establishing a contract in Hong Kong is the source-based taxation policy. “Hong Kong will not tax profits derived from outside Hong Kong,” mentioned Steven Sieker, Partner at Baker McKenzie. “If I’m in the money-lending business, I can lend to foreign entities, receive interest and pay zero tax on interest income.”

 

Hong Kong’s community of professionals is culturally and technically diverse, an advantage again when making deals and arranging transactions across the distances encompassed by the Belt and Road Initiative. Yet Hong Kong’s elite professionals are also known for their expertise and experience with the Chinese mainland. In addition, Hong Kong has close ties with the ASEAN countries, which are currently the largest recipients of Belt and Road-related investment.

 

From project planning, architectural consulting and engineering; dispute resolution, legal contract drafting and deal making; investment and financial services, auditing, accounting and tax consulting; to trade and logistics management, Hong Kong’s professions are stocked with world-class talent, with multicultural knowledge as well as China-related experience.

 

Avron Boretz, Kaya Consulting International

 

Click here for more event highlights and speaker insights from the Belt and Road Summit held in Hong Kong on 28 June 2018.  

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How to safeguard your business while expanding along the Belt and Road?

Five key questions to ask when signing Belt and Road contracts

 

By the Hong Kong International Arbitration Centre (HKIAC)

 

China’s Belt and Road initiative is set to enhance investment along new economic corridors from Asia to Europe, which means a wealth of cross border business opportunities.

 

When capitalising on these new opportunities, businesses must however be mindful of potential risks as they prepare contracts. Concluding agreements between parties from countries with very different legal systems, political regimes and cultures, and at different stages of economic development, will inevitably present challenges – and a significant risk of legal disputes. Therefore, businesses must ensure that Belt and Road contracts include an effective dispute resolution clause, agreed upon by all parties. To do this, companies should consider the following five questions:

 

  1. Should an arbitration clause be included in the contract? Arbitration refers to a method of dispute resolution that results in a binding decision, or “award”, which is readily enforceable internationally. The process is conducted an internationally neutral setting. Arbitration is the most effective and commonly used means of resolving cross-border transactions. It allows parties to avoid the local courts of their counterparty and increase their chances of recovering any loss internationally. The right arbitration clause can help ensure the fair and efficient resolution of international disputes arising out of complex Belt and Road transactions. With an arbitration clause in the initial contract, organisations engaging in Belt and Road projects will have an important tool available to protect their business should a dispute arise.

 

  1. What kind of arbitration is right for the contract? An arbitration can be administered or ad hoc. Administered (or “institutional” arbitration) provides for a specialized, professional institution to help conduct and monitor the process. Institutions have tried and tested procedural rules available for parties according to which their case can be conducted. Administered arbitration is favoured for complex transactions and, in particular, where parties from Mainland China are involved as ad-hoc arbitration is not widely accepted in Mainland China. Ad hoc arbitration, on the other hand, is conducted without the involvement of a professional institution, so parties and arbitrators manage the process themselves.  

 

  1. Which institution should administer the arbitration? Parties should choose an independent institution with a history of success in managing international cases, which offers mechanisms to increase efficiency and reduce costs. Arbitration institutions with strong China expertise can better bridge the different legal and cultural practices between Chinese and foreign parties, and increase prospects for the enforcement of awards in Belt and Road-related international disputes. HKIAC is such an institution.

 

  1. What is the seat of arbitration and where should it be? The seat of arbitration determines which laws apply to the procedure of the arbitration and, crucially, the “nationality” of the arbitral award. Companies will want to choose a seat with an independent legal system and a strong enforcement track record for arbitral awards internationally. Hong Kong is ranked as the third[1] most preferred and used seat of arbitration worldwide and the most favoured seat outside of Europe. This is due to its world-leading arbitration legislation, neutrality, large pool of multilingual professionals, independent and sophisticated judiciary and the pro-arbitration stance that its courts consistently adopt. The fact that Hong Kong is simultaneously part of China and an autonomous special administrative region with a mature and reliable legal system based on the English system, makes it a particularly strong choice for Belt and Road contracts.

 

  1. How can the final decision from the arbitration be enforced? By virtue of an international convention known as the New York Convention 1958 to which over 150 countries are a party, arbitral awards are enforceable almost all over the world and certainly in all major economies. As a result, arbitration is a much better option than litigation in national courts for enforcement purposes (because domestic judgments cannot be easily enforced overseas). Awards made in Hong Kong are directly enforceable in more than 150 jurisdictions including Mainland China, and Hong Kong and HKIAC awards have an excellent track record of enforcement globally and one of the highest records of enforcement in Mainland China.

 

While the ultimate goal is to capitalise on Belt and Road business opportunities, businesses must also be ready to act in their best interests if disputes arise. With a well-drafted arbitration clause in the contract, companies will be better prepared and well positioned to reap maximum value from Belt and Road projects while protecting their business.

[1] Queen Mary University of London, 2015: http://www.arbitration.qmul.ac.uk/research/2015/

HKIAC.png

As one of the world’s leading commercial dispute resolution service providers, the Hong Kong International Arbitration Centre (HKIAC) will play a leading role in resolving commercial disputes arising out of the Belt & Road Initiative (OBOR).

Specialising in arbitration, mediation, adjudication and domain name dispute resolution, HKIAC maintains one of the largest caseloads in the Asia-Pacific region, having handled over 9,000 commercial cases since its establishment in 1985.

OBOR is set to generate a significant increase in cross-border commercial opportunities between Chinese investors, their local partners and host governments in the OBOR region.  Such opportunities come with risk, HKIAC has a reliable and well-tested system for efficiently handling disputes arising under commercial contracts between OBOR parties.

HKIAC’s Administered Arbitration Rules have provisions that can be strategically used to control costs and increase efficiency for resolving construction, joint venture or project finance disputes between Chinese investors and their OBOR contractors, and expedited procedures are available for low value disputes or where urgent relief is required.

Protect your investment and mitigate risk in OBOR projects by selecting an HKIAC dispute resolution clause that will provide for the reliable resolution of disputes through settlement or a binding decision that is enforceable in over 156 countries worldwide. 

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This short video highlights the risk and types of disputes that can arise in projects under the Belt and Road Initiative, and the role of Hong Kong and the Hong Kong International Arbitration Centre (HKIAC) in resolving such disputes.
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Belt & Road Summit 2018: Collaboration for Success
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Under the theme “Collaborate for Success” the third Belt and Road Summit illuminated major Initiative developments. Shinta Widjaja Kamdani of Indonesia’s Sintesa Group spoke of Hong Kong playing a vital role as her company developed an eco-tourism special economic zone. Meanwhile, Mark Moseley of the Global Infrastructure Hub said Hong Kong has a huge advantage for handling significant public-private infrastructure project risks. Speakers: Vincent HS Lo, Chairman, Hong Kong Trade Development Council Carrie Lam, Chief Executive, Hong Kong Special Administrative Region Manuel Pangilinan, Chairman, Metro Pacific Investments Corporation Melvyn Pun, CEO, Yoma Strategic Holdings Ltd Shinta Widjaja Kamdani, CEO, Sintesa Group Mark Moseley, CEO, Global Infrastructure Hub   Related Links: Hong Kong Trade Development Council http://www.hktdc.com HKTDC Belt and Road Portal http://beltandroad.hktdc.com/en/
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Expert insights: Infrastructure investment trends on the Belt and Road

 

Belt and Road investment continues to flow to large infrastructure projects, but renewable energy is a growing and in-demand sector. Meanwhile, moves to attract private capital by promoting public-private partnerships (PPPs) have begun in earnest.

 

The Belt and Road Initiative aims to connect every quadrant of Asia with Europe, the Middle East and Africa over six inter-regional corridors, through construction of communications, power and industrial infrastructure on a massive scale. The projected total investment, scaled in trillions, has generated much expectation around the world.

 

With the estimates of projected spending varying from US$1 trillion to as much as US$8 trillion, the Belt and Road Initiative is easily the world’s leading programme of planned infrastructure construction today and in the foreseeable future. And all that building—roads, railways, ports, power plants and more—will certainly have a long-term, beneficial impact on local and regional economies beyond the cash flowing to contractors and the wages paid to workers.

 

Through 2018, more than 80% of Belt and Road project funding (some sources estimate up to 90%) has come from governments and multilateral banks, possibly due to the long investment horizons of infrastructure projects and the financial, environmental, political and legal risks entailed, particularly when it comes to projects in less-developed countries.

 

Since 2017, the National Development and Reform Commission (NDRC) has been actively promoting PPP as a model for Belt and Road investment. All sides now recognise that, having kick-started the process, the involvement of private capital is key to sustaining Belt and Road development. Bernard Charnwut Chan, President, Asia Financial Holdings Ltd, summed up the rationale at the Belt and Road Summit in Hong Kong this June: “Government cooperation can prepare the foundations, but it’s up to the business community to build on them and bring projects to fruition.”

 

A more prominent role for PPPs could significantly alter the Belt and Road investment landscape. There are encouraging signs that the message is already beginning to reach its intended audience: an intensive training workshop in PPP and the Belt and Road was held in Hong Kong and Geneva, Switzerland in 2017, jointly organised by UNECE’s International PPP Centre of Excellence and two of the top universities in Beijing and Hong Kong.

 

Building private sector investor confidence will require more concrete changes in the Belt and Road ecosystem, however. Not the least of these will be moving towards higher standards of governance (a topic addressed positively in comments by Chinese Foreign Minister Wang Yi, speaking last March in Paris), greater risk awareness and professional risk management, and a neutral venue for dispute resolution, with Hong Kong the leading candidate to take that role. One of the disincentives to private investment in the Belt and Road Initiative, however, has been a relative lack of bankable projects, as Eddie Yue, Deputy Chief Executive of the Hong Kong Monetary Authority, underscored in his opening remarks as chair of the Risk Mitigation in Infrastructure Financing panel at the Belt and Road Summit.

 

More optimistically, Fang Qiuchen, Chairman of China International Contractors Association (CHINCA) observed that “investors are now the driving force [in the Belt and Road Initiative]. We need to be clear about the challenges and aware of the risks, not least political, but this is the time to grasp opportunities.”

 

In fact, many of the top Chinese infrastructure and construction companies are already listed in Hong Kong; and a Hong Kong government pilot bond grant scheme to offset bond issuer expenses will generate additional Belt and Road investment opportunities.

 

Another increasingly popular sector is clean and renewable energy, as Wang Jianping, Chairman of China Energy Engineering Group pointed out: “There’s a huge gap between supply and demand for electricity along the Belt and Road, so we see a bright future for power generation.” This demand, Wang explained, extends to renewable energy and new-energy projects such as hydro, wind, solar and biomass. These clean energy projects are well supported, developed in partnership with the Silk Road Fund and China Environmental Energy Investment, a private Hong Kong-based holding company.

 

Green finance is yet another trending area which offers some intriguing opportunities. The Hong Kong Special Administrative Region (HKSAR) Government is set to launch an extensive green bond programme aimed at promoting and supporting Belt and Road development, and to attract international investors to fund green projects through Hong Kong’s capital markets. “The development of green financing is as important as developing green products and services, bringing more diversity, liquidity and business to our capital market,” said Joseph Chan, Under Secretary for Financial Services and the Treasury of the HKSAR Government.

 

As Belt and Road infrastructure projects reach completion, the investment picture will begin a shift to second-wave construction projects and related services. One of the early second-wave Belt and Road projects was described by Broad Homes Industrial Group Chairman Zhang Jian: “As economies develop along the Belt and Road, strong demand also grows for housing—in particular affordable and often urgent housing. . . . Housing will become in great demand, and it brings immediate benefit to communities.”

 

Besides industry, cultural and structural trends, the geography of Belt and Road investment trends warrants attention. While South and Central Asia have seen a net downturn in Chinese outward foreign direct investment over the past three years, the Middle East and Russia have enjoyed a modest uptick. In the Middle East, Saudi Arabia offers a twist to the Belt and Road tale: facing a housing shortage, the kingdom is interested in partnering with Chinese developers, such as the Government of the Ningxia Hui Autonomous Region which signed a memorandum of understanding with the Saudi Ministry of Housing to develop the Al-Asfar outskirts in Al-Ahsa Province and build 100,000 housing units.

 

Finally, with their geographical and cultural proximity to China, the ASEAN countries have enjoyed the largest and steadily increasing concentration of Chinese investment—a trend that is likely to continue for some years to come.

 

Avron Boretz, Kaya Consulting International

 

Click here for more event highlights and speaker insights from the Belt and Road Summit held in Hong Kong on 28 June 2018.

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As the Belt and Road Initiative moves towards a public-private partnership-centred model and aims to attract more global investment, evaluating, mitigating and allocating risk will be key to project success.

With the most acute connectivity gaps in the developing countries of South and Central Asia (the Belt), and Southeast Asia, the Middle East, and North Africa (the Road), the risks appear especially prominent. Additionally, large infrastructure projects do not always promise a direct return on investment; those that do may have an investment horizon of years or even decades. Not surprisingly, up to 80% of the investment in Belt and Road projects so far has come from government or multilateral organisations, such as the Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB) and the World Bank.

 

“We need to find ways to mitigate risk to encourage private capital in infrastructure,” observed Eddie Yue, Deputy Chief Executive of the Hong Kong Monetary Authority, at the Belt and Road Summit held this June in Hong Kong.

 

Many of the risks cited by expert panelists at the Summit—such as political, legal, financial and foreign exchange risk—are common to most cross-border infrastructure projects. As some of the region’s leading infrastructure investors and insurers pointed out, project success rests on assessing and mitigating risks, some of which are country- and industry-specific. Ian Chung, Senior Vice President of engineering firm AECOM, noted that Belt and Road projects can be quite complex, involving many parties; this, along with other factors, such as the relatively long term of investment, exposes some projects to financial risk.

 

To date, much of the discussion of risk and risk management on the Belt and Road has focused on the many larger, signature infrastructure projects that have characterised the first phase of the Initiative. But looking at the Initiative in its fullest extent, this may turn out to be somewhat narrow in scope. Consider the category of political risk, for example. Political risk means something quite different when applied to a mining project in Pakistan and a deep-sea port construction in Georgia. Pakistan highlights the need for far stronger risk assessment and management at every stage of every project in areas of high political volatility. Georgia, on the other hand, offers a more hopeful perspective on political as well as financial risk along the Belt and Road.

 

Perhaps with an eye to geopolitical concerns (but through a competitive bidding process), Georgia awarded the contract to plan and build the Anaklia Deep Water Black Sea Port to a US-backed consortium. Yet, Georgia, having recently signed a free trade agreement with Hong Kong, has all along defined the port project as a potentially important connector for Chinese trade with Europe. Along with several other major Belt and Road infrastructure projects in the Central Asia/Eastern European region, Anaklia sends a strong message that the Initiative is ultimately about extending cooperation and connectivity to any partner willing to embrace the vision.

 

Georgia is one of the several transitional economies along the Belt and Road with a similar risk profile. In the next phase of Belt and Road development, we can expect to see more projects based in these countries (whether in Central Asia, ASEAN, the Middle East or Eastern Europe) backed by both government and private capital, with multiparty participation in planning, finance, construction and operation.

 

In the difficult terrain of Pakistan and the more business-friendly confines of Georgia alike, reducing exposure, managing and sharing risk are equally important to the success of Belt and Road projects. The question, then, is where will the necessary expertise come from?

 

To begin with, Belt and Road project contractors and funders must be proactive about risk management. This begins with assessment, often requiring a close-up evaluation of local conditions and practices, with particular attention to legal, compliance and political risks—the so-called “preventable risk.” However, as Hannah Ha, Partner at Mayer Brown, emphasised in her remarks at the Belt and Road Summit, Chinese companies might not necessarily be familiar with local laws and cultures, which can leave them exposed in multiple areas when operating abroad.

 

It’s not that Chinese companies lack risk awareness: a 2016 Deloitte survey of Chinese state-owned enterprises (SOEs) found that Chinese SOEs identified “risk control” as one of the top three challenges they face in overseas environments. Rather, Chinese business culture has traditionally treated risk management more as a function of personal networks and connections, and are now looking to the insurance industry to provide the requisite professional expertise. Chinese insurers, in turn, are responding to this demand, and are working to develop the sorts of sophisticated loss prevention and compensation products that Belt and Road projects require.

 

“Insurance companies will look at risk in a different way than a construction company would look at risk,” noted Liu Shihong, Vice Chairman and Chief Executive Officer of Taiping Reinsurance Company Ltd. Insurers will look at multiple categories of risk, and have the tools and experience newcomer companies lack to devise appropriate management and mitigation strategies.

 

Insurance industry experts who spoke at the Summit felt that the Initiative holds considerable long-term revenue potential. Elsewhere, UK and Chinese insurers have been in discussion on closer cooperation on the Belt and Road while ASEAN insurers are actively exploring ways to tap new Belt and Road opportunities. Overall, Swiss Re estimates that the Initiative, directly and indirectly, “could generate up to US$23 billion in commercial insurance premiums by 2030,” as cited by Bryce Johns, Group Head of Insurance at HSBC, at a recent Belt and Road Initiative insurance conference in Singapore.

 

Speakers at the Hong Kong Belt and Road Summit agreed, however, that this potential remains largely untapped. Franz-Josef Hahn, Chief Executive Officer of Peak Re, suggested that this owes partly to low levels of collaboration across the region that stems the flow of analysable data. With deeper knowledge of conditions, insurers would be better able to offset risk exposure.

 

For infrastructure projects, he added, “Belt and Road stakeholders should be aware that once a project is completed there are also operational risks.” Revenue shortfalls, foreign exchange restrictions, expropriation and other political risks, even environmental issues can all affect returns. Hahn added that the expertise available in Hong Kong could save clients time, costs and reputation.

 

Since even the most thorough due diligence and the most expert risk assessment cannot anticipate all contingencies, there is an acute need for insurance and risk allocation that take account of local conditions and business structure—especially in the case of public-private partnerships for Belt and Road projects. Companies and partners need to be aware of what is and is not covered; for example, Zurich Insurance Company Ltd is involved with infrastructure projects, and insures political and credit risk, inability to perform, and other risk categories in emerging markets. Notably, Zurich and other insurers do not always cover dispute risk. But given the great number, scale and variety of projects on the Belt and Road, disputes will happen. Preparing for the possibility of arbitration should be baked into the risk management strategy of every project. According to Vincent Connor, Partner, Pinsent Masons, a dispute resolution clause must be a priority for any contract and, he emphasised, “The best seat for resolution is Hong Kong.”

 

There are also notable advantages to setting up a captive insurer in Hong Kong, due to its open economy and deep pool of expertise. A captive insurer can be structured to allocate risk among subsidiaries and associates, which would be particularly useful for complex Belt and Road projects with unique sets of risks. Andrew Chow, Chief Risk Officer at Sinopec Insurance Ltd pointed to captive insurers as being an ideal choice for mainland SOEs and other large organisations.

 

The Belt and Road countries run the gamut of economic development. And while infrastructure connectivity is only one of the five cooperation priorities, it remains the core building block of the Belt and Road Initiative, with an expected US$5 trillion to be invested by 2030. To develop bankable projects that can attract private capital, risks should be better assessed and managed. Understanding and operating in this complex environment requires experience, well-tested practices, but also creative and flexible approaches. The Belt and Road Initiative is, increasingly, an appealing target for many categories of investors. Belt and Road projects and investors would do well to seek the help of risk management professionals—consultants, insurers, legal dispute resolution experts and others—to help them navigate through the hazards and reap the rewards.

 

Avron Boretz, Kaya Consulting International

 

Click here for more event highlights and speaker insights from the Belt and Road Summit held in Hong Kong on 28 June 2018.

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