Africa

Short Code
AS
About this project
About this project

Thursday 25 April 2019 (Beijing) – It was announced today that 27 global institutions have signed up to a set of voluntary principles – the Green Investment Principles (GIP) for the Belt and Road -- to promote green investment in the Belt &Road region.

 

The announcement was made at the GIP signing ceremony as part of the Financial Connectivity Forum organized by the People’s Bank of China (the Central Bank) and the Ministry of Finance in Beijing during the second Belt and Road High-level Forum. Deputy Governor Chen Yulu from the People’s Bank of China attended the GIP signing ceremony.

 

 

Chen Yulu, Deputy Governor of the People’s Bank of China

 

As a mandate from the China-UK Economic and Financial Dialogue in 2017, the Green Finance Committee of China Society for Finance and Banking and the City of London Corporation’s Green Finance Initiative led the initiative to develop the GIP, which was first published in London in November 2018. The World Economic Forum, UNPRI, Belt & Road Bankers Roundtable, the Green Belt and Road Investor Alliance and the Paulson Institute are also part of the drafting group. A full list of the principles is provided at the bottom of this release.

 

Building on existing responsible and ESG investment initiatives, the GIP aims to incorporate low-carbon and sustainable development practices into investment projects in Belt and Road countries, which will host the majority of the world’s infrastructure investments in coming decades.

 

Since its launch five months ago, the GIP has received strong backing from the global financial industry, including commercial banks, development banks, institutional investors, stock exchanges and other stakeholders that invest or help mobilize investment in the Belt and Road. As of April 25, 2019, twenty-seven institutions have signed up to the GIP. These institutions include (in alphabetical order):

 

Agricultural Bank of China, Agricultural Development Bank of China, Al Hilal Bank, Astana International Exchange, Bank of China, Bank of East Asia, China Construction Bank, China Development Bank, China International Contractors Association, China International Capital Corporation, Crédit Agricole-CIB, DBS Bank, Deutsche Bank, Export-Import Bank of China, First Abu Dhabi Bank, Habib Bank of Pakistan, Hong Kong Exchanges and Clearing, Industrial and Commercial Bank of China, Industrial Bank, Khan Bank, Luxembourg Stock Exchange, Mizuho Bank, Natixis Bank, Silk Road Fund, Standard Chartered Bank, Trade and Development Bank of Mongolia and UBS Group.

 

These signatories include all major banks from China that invest in the Belt & Road region and some of the largest financial institutions from (in alphabetical order) France, Germany, Hong Kong, Japan, Kazakhstan, Luxembourg, Mongolia, Pakistan, Singapore, Switzerland, United Arab Emirates and the United Kingdom. Several service providers, including Deloitte, Ernst & Young, KPMG and PWC, have also expressed their support for the GIP.

 

Ma Jun, Chairman of China’s Green Finance Committee, announced at the GIP signing ceremony that a Secretariat would be established to support future work of the GIP. The GIP Secretariat will work on expanding the membership, the development of implementation tools and case studies, a green project database for the Belt & Road, as well as compiling the progress report.

 

Chen Yulu, Deputy Governor of the People’s Bank of China, said at the signing ceremony: “The financial institutions represented here today are the leading institutions of green investment for the Belt and Road. I hope that all signatories can seize the great opportunity of the BRI, and actively promote the GIP and enhance their capacity for green investment.”

 

Dr. Ma Jun said: “The majority of global infrastructure investment in the coming decades will be in the Belt and Road region and they will have a significant impact on the implementation of the Paris Agreement and UN Sustainable Development Goals. The aim of the GIP is to ensure that environmental friendliness, climate resilience, and social inclusiveness are built into new investment projects in the Belt and Road.

 

Ma Jun, Chairman of China Green Finance Committee

 

Catherine McGuinness, Chair of Policy at City of London Corporation commented: “While there is some way to go to ensuring the Belt and Road is truly green, today’s announcement is another step in the right direction, and a powerful statement of intent from financial firms in China, the UK and across the world.”

 

Catherine McGuinness, Chair of Policy at City of London Corporation 

 

Family photo of major GIP Signatories

 

David Aikman, Chief Representative Officer of China and Member of the Executive Committee, World Economic Forum, addressed the importance of making GIP an opportunity for green transformation in the region and said: “It will be a shared opportunity for inter-connectivity, environmental friendliness and economic development through green investment in many countries around the world.”

 

Signatories also expressed their commitment to greening their investment practices with the implementation of GIP. “Business and economic ties between China, Europe, and BRI countries continue to strengthen”, said Werner Steinmueller, Deutsche Bank Management Board Member and Chief Executive Officer for Asia Pacific. We are one of the most active foreign banks participating in BRI with full corporate and investment banking offerings along the route. By committing to the GIP, we are pledging that we will not only help steer BRI’s open collaboration across countries from China to Europe, but also strive to ensure these projects are as sustainable as possible.”

 

Gu Shu, President of Industrial and Commercial Bank of China, commented: “Green investments play a critical role in addressing environmental and climate challenges along the Belt and Road. ICBC has participated actively in the drafting of the GIP. We have also invited BRBR members to sign up to the GIP and integrate environmental factors into the BRI-related financing decisions, operations, product development and risk management.”

 

Gu Shu, President of Industrial and Commercial Bank of China

 

Bill Winters, Group Chief Executive of Standard Chartered PLC, stated: “We have been supporting our clients in managing their environmental and social risks for decades and are committed to working with all parties to implement the Green Investment Principles and contribute to commerce and prosperity across the Belt and Road markets.”

 

Benjamin Hung Pi Cheng, Regional CEO of Greater China & North Asia, Standard Chartered

 

Philippe Brassac, CEO of Crédit Agricole S.A and the Chairman of Crédit Agricole CIB, said: “Today, we reaffirm our ambition to be your long-term banking partner for your energy transition projects. A partner that is both realistic and demanding concerning the climate.”

 

 “As China’s development finance institution and its major bank for the Belt and Road, the China Development Bank will stay committed to green finance, implement green investment principles, increase the provision of green finance, and grow the capacity for green development, to contribute to sustainable economic and social development along the Belt and Road”, said Hu Zhirong, Director of International Finance Bureau of China Development Bank.

 

Huang Liangbo, Vice President of Export-Import Bank of China, said: “To cater to the needs of the BRI participating parties to conserve resources, protect the environment and cope with climate change, the Export-Import Bank of China has been diversifying its financial products and services related to green projects, and played a major role in investing and financing green infrastructures.”

 

Lin Jingzhen, Vice President of Bank of China, said: “By signing up to the GIPs, it marks a milestone for Bank of China to integrate green development strategy into our efforts of supporting the construction of the Belt and Road ‘financial artery’. We look forward to working with international counterparts to foster the green and sustainable development along the Belt and Road.”

 

Qian Wenhui, President of Agricultural Development Bank of China, said: “Agricultural Development Bank of China will gather forces from all sides and assist domestic agriculture-related enterprise and projects to participate in the Belt and Road green investments.”

 

Tao Yiping, President of Industrial Bank, commented: “By proactively supporting the low-carbon, green and sustainable development of countries along the Belt and Road, GIP will support global financial institutions to establish more extensive and intensive corporations within multilateral frameworks and to increase environmental and social risk management ability.”

 

Xie Duo, Chairman of the Silk Road Fund, commented: “The Silk Road Fund, being a medium to long-term development and investment fund to support the BRI, is committed to implementing and promoting green investment philosophy, and dedicated to building a green Silk Road.”

 

Muhammad Aurangzeb, President and CEO of Habib Bank of Pakistan, said: “It is a great initiative taken by China Green Finance Committee and City of London for this GIP signing. As Pakistan’s largest Bank, and the largest executor of CPEC related financing in Pakistan, HBL is positioned to play an integral role towards a greener CPEC, with the ultimate goal of a greener BRI.”

 

Tim Bennett, CEO of Astana International Exchange, said: The sign up to the GIP emphasizes the regional perspective of AIX to support infrastructure and economic development in Kazakhstan and in the region in accordance with environmentally and socially friendly international practices.”

 

Abdulhamid Saeed, Group Chief Executive Officer of First Abu Dhabi Bank, stated: “By becoming one of the first signatories to the GIP, we intend to take a more active role in the Belt and Road Initiative and in supporting global efforts to promote green investments within the UAE and beyond.”

 

For more information, please contact:

 

CHENG Lin

China Coordinator of the GIP, China Green Finance Committee

Tel: +86 (10) 8302 1702

Email: lin.cheng@greenfinance.org.cn

 

Simon Horner

Head of Policy and Innovation, City of London

Tel: +44 (0) 7721 977119

Email: simon.horner@cityoflondon.gov.uk

 

 

ANNEX: GREEN INVESTMENT PRINCIPLES FOR THE BELT AND ROAD

 

Principle 1: Embedding sustainability into corporate governance

 

We will embed sustainability into our corporate strategy and organisational culture. Our boards and senior management will exercise oversight of sustainability-related risks and opportunities, set up robust systems, designate competent personnel, and maintain acute awareness of potential impacts of our investments and operations on climate, environment and society in the B&R region.

 

Principle 2: Understanding Environmental, Social and Governance Risks

 

We will strive to better understand the environmental laws, regulations, and standards of the business sectors in which we operate as well as the cultural and social norms of our host countries. We will incorporate environmental, social and governance (ESG) risk factors into our decision-making processes, conduct in-depth environmental and social due diligence, and develop risk mitigation and management plans, with the help of independent third-party service providers, when appropriate.

 

Principle 3: Disclosing environmental information

 

We will conduct analysis of the environmental impact of our investments and operations, which should cover energy consumption, greenhouse gas (GHG) emissions, pollutants discharge, water use and deforestation, and explore ways to conduct environmental stress test of investment decisions. We will continually improve our environmental/ climate information disclosure and do our best to practice the recommendations of the Task Force on climate-related Financial Disclosure.

 

Principle 4: Enhancing communication with stakeholders

 

We will institute stakeholder information sharing mechanism to improve communication with stakeholders, such as government departments, environmental protection organizations, the media, affected communities and civil society organizations, and set up conflict resolution mechanism to resolve disputes with communities, suppliers and clients in a timely and appropriate manner.

 

Principle 5: Utilizing green financial instruments

 

We will more actively utilize green financial instruments, such as green bonds, green asset backed securities (ABS), Yield Co, emission rights based financing, and green investment funds, in financing green projects. We will also actively explore the utilisation of green insurance, such as environmental liability insurance and catastrophe insurance, to mitigate environmental risks in our operations.

 

Principle 6: Adopting green supply chain management

 

We will integrate ESG factors into supply chain management and utilize international best practices such as life cycle accounting on GHG emissions and water use, supplier whitelists, performance indices, information disclosure and data sharing, in our investment, procurement and operations.

 

Principle 7: Building capacity through collective action

 

We will allocate funds and designate personnel to proactively work with multilateral organizations, research institutions, and think tanks to develop our organizational capacity in policy implementation, system design, instruments development and other areas covered in these principles.

 

Editor's picks

GDP (US$ Billion)

14.12 (2019)

World Ranking 129/194

GDP Per Capita (US$)

525 (2019)

World Ranking 186/193

Economic Structure

(in terms of GDP composition, 2019)

Services
(52.45%)
Industry
(17.13%)
Agriculture
(23.16%)

External Trade (% of GDP)

59.8 (2019)

Currency (Period Average)

Malagasy Ariary

3618.32per US$ (2019)

Political System

Republic

Sources: CIA World Factbook, Encyclopædia Britannica, IMF, Pew Research Center, United Nations, World Bank

  • Madagascar is an island country located in the Indian Ocean. It lies about 400 km off the east coast of Southern Africa. Madagascar is a low-income country, with its economy largely relying on agriculture which accounts for about 70% of employment. Yet the country is frequently hit by natural disasters including storms, floods and droughts, which disrupt agricultural production and often poses threats to food security.
  • Madagascar’s major exports include vanilla, raw nickel and cloves, which combined to account for more than 40% of the country’s total exports. The country’s primary export markets are France, US, Germany and China. Madagascar is one of the world’s top producers of vanilla, supplying about 80% of the world’s vanilla. Amid the growing demand by large-scale food manufacturers to produce natural vanilla flavour, the price of vanilla has surged by almost four times since 2015, which has helped the country to narrow its trade deficit.
  • Madagascar acceded to the WTO in 1995. It is also a member country of the Southern African Development Community (SADC) and Common Market for East and Southern Africa. Madagascar has concluded bilateral investment agreements with seven countries including China, France, Germany and Switzerland.
  • Since its independence from France in 1960, Madagascar has experienced periods of political instability. The political crisis in 2009 led to international economic sanctions including those imposed by the EU and the US. In response to the democratic elections held in 2014, the US reinstated Madagascar’s eligibility to the African Growth and Opportunity Act (AGOA) which expanded the product scope for duty-free exports to the US based on the existing Generalised System of Preferences (GSP).
  • With an aim to boost foreign direct investment and strengthen the competitiveness of the private sector, the government established the Economic Development Board of Madagascar (EDBM) in 2006. As the official agency for investment promotion, EDBM facilitates the approval of investment projects, through providing one-stop shop and tailored services for investors in setting up and expanding their businesses in Madagascar.
  • Madagascar’s Investment Law stipulates that investors, both foreign and local, are allowed to hold up to 100% share of capital in the company, except for certain sectors which are specifically regulated, including banking, insurance, mining, petroleum, telecommunications, medical, paramedical and pharmaceutical activities. Cumulative FDI in Madagascar reached US$5.88 billion in 2016, compared to US$4.92 billion in 2011. In the 2018 Doing Business report published by the World Bank, Madagascar ranked 162 out of 190 economies.
  • In March 2017, China and Madagascar signed a memorandum of understanding (MOU) on jointly advancing the Belt and Road Initiative, as well as bilateral agreements in economic co-operation, trade and infrastructure construction. Total trade between Madagascar and China increased by 8.6% to US$1.25 billion in 2017. According to China’s Ministry of Commerce, China’s cumulative FDI in Madagascar was US$297.6 million in 2016, compared to US$25.4 million in 2011.

 

Hong Kong's Trade with Madagascar

(US$ million)

2017

2018

2019

Value

Growth (%)

Value

Growth (%)

Value

Growth (%)

Total Exports

39.7

+7.8

40.9

3.0

31.3

-23.6

  Domestic exports

0.6

-10.0

0.8

+24.6

0.6

-20.0

  Re-exports

39.1

+8.2

40.1

+2.7

30.6

-23.7

Imports

4.7

-9.9

6.4

+35.9

3.8

-40.2

Total Trade

44.4

+5.7

47.3

+6.5

35.1

-25.9

Source: Hong Kong Trade Statistics, Census & Statistics Department

 

Major export commodities (2019)

Top 5 Commodities in SITC

Share (%)

Miscellaneous manufactured articles

14.2

Telecommunications equipment & parts

13.7

Printed matter

10.9

Tulle, lace, embroidery, ribbons, trimmings and other small wares

10.6

Textile yarn

6.4

Source: Hong Kong Trade Statistics, Census & Statistics Department

 

Major import commodities (2019)

Top 5 Commodities in SITC

Share (%)

Crustaceans, molluscs and aquatic invertebrates

56.5

Fish, dried, salted or in brine; smoked fish; flours, meals and pellets of fish

13.6

Fish, fresh (live or dead), chilled or frozen

6.9

Women's or girls' wear of textile fabrics, not knitted

5.8

Crude vegetable materials, nes

4.1

Source: Hong Kong Trade Statistics, Census & Statistics Department

 
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In order to best support our clients across Asia and the rest of the world, Bryan Cave Leighton Paisner is structured in a way few other law firms are – as a fully integrated international team that provides clients with clear, connected legal advice wherever and whenever they need it.

Working as 'One Firm', we bring to our clients a range of integrated capabilities. This includes some of Asia’s most active corporate, finance, real estate, litigation and corporate risk practices, all geared toward supporting our clients’ inbound and outbound investment strategies across key sectors. These sectors include real estate, infrastructure, energy & natural resources (with a focus on renewable & sustainable energy), financial services, sports & entertainment and food & agribusiness. 

Our lawyers in our Asia offices are admitted to practice in various jurisdictions including Hong Kong, the PRC, Australia, England and Wales, and New York. In addition to our Hong Kong and Singapore offices, we have strong relationships with leading local firms across the region to ensure our clients receive seamless service and better links to each country’s business communities.

Bryan Cave Leighton Paisner brings enduring value to our client relationships and we are here to help you compete around the world, or just around the corner.

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Middle East
Power and Energy, Natural Resources (including oil and gas), Highways, Bridges and Tunnels, Rail and Mass Transit, Ports, Terminals and Airports, Logistics Parks/Centres, Water and Waste Management, Smart City, Telecommunications
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Allianz Trade is the trademark used to designate a range of services provided by Euler Hermes.

Allianz Trade is the global leader in trade credit insurance and a recognized specialist in the areas of surety, collections, structured trade credit and political risk. Our proprietary intelligence network analyses daily changes in +80 million corporates solvency. We give companies the confidence to trade by securing their payments. We compensate your company in the event of a bad debt, but more importantly, we help you avoid bad debt in the first place. Whenever we provide trade credit insurance or other finance solutions, our priority is predictive protection. But, when the unexpected arrives, our AA credit rating means we have the resources, backed by Allianz to provide compensation to maintain your business. Headquartered in Paris, Allianz Trade is present in 52 countries with 5,500 employees. For more information, please visit https://www.allianz-trade.com/en_HK.html

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About this project
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About this project