CMEC adds fresh vigor to Sino-Latin American partnership

China Machinery Engineering Corporation, China's first large engineering and trade company, cashed in on the opportunities offered by innovation and "going global", and now enjoys a high global reputation in the fields of electrical energy and transportation. Sun Bai, chairman of the board of CMEC, expounded CMEC's national strategy advantages and key performances to China Daily, and reviewed its achievements in Argentina in recent years. He then outlined the future prospects for business expansion as creating mutual benefits in Argentina and the wider Latin American market.

In recent years, China has enjoyed more and more social and policy advantages in the Latin American market. Could you explain these advantages?

In terms of the international environment in recent years, the development of Sino-Latin American relations has leapt forward at a rapid pace. It is necessary to promote orderly development and global diversification by strengthening bilateral economic and trade exchanges, and international cooperation in the engineering sector.

In 2014, Premier Li Keqiang made a speech to the Economic Commission for Latin America and the Caribbean, pointing out that both China and Latin America should strive to achieve four goals: friendship and mutual trust, mutual benefit and win-win results, mutual learning and overall cooperation, thereby consolidating and developing their common interests.

In 2015, President Xi Jinping said China would build a "comprehensive cooperative partnership" with Latin America, and that both sides should seize new opportunities and consider infrastructure and transportation as two important fields for future cooperation.

In terms of social environment, China and Latin America have complementary structures in industrial chains of supply and demand. China has a cost-effective equipment manufacturing capacity, integrated technology, as well as rich experience in international engineering contracting. Latin America needs infrastructure construction and industrial upgrading. If we can cooperate in these fields, we will fully develop our comparative advantages and therefore reduce construction costs, create job opportunities, and connect regional energy and transportation networks. Such a result would mean we would have achieved bilateral win-win cooperation and sustainable political and economic development.

To implement Sino-Latin cooperation, what achievements has CMEC made in electrical energy, transportation and other fields?

For over 30 years, CMEC engineering contracting businesses have spread to nearly 50 countries and regions in the fields of electrical energy, transportation and electronic communications.

CMEC has rich experience in the electrical power industry and has already created a variety of modes of cooperation. In Pakistan in 1983, CMEC built the Gudu Thermal Power Plant, which can produce 210 megawatts of energy. That was the first time Chinese enterprises had used export seller's credit to contract an international project.

The 600-mW Central Power Plant in Venezuela is the largest electrical power engineering project built with Chinese technology in Latin America. Our 120-mW hydropower station, an EPC project, in Brazzaville is the largest hydropower station Chinese contractors have built in the Republic of Congo.

In transportation, CMEC's Argentina Belgrano Cargo Railway Rehabilitation Project, with a total value of $2.47 billion in the first phase, not only won high praise from the two governments and financial institutions, but also injected strong vitality into diversified developments in related fields in both countries.

Could you briefly give some details about that project?

This is a $10 billion transportation renovation project agreed by the Chinese and Argentine governments. It is an important project in which the Chinese government is supporting enterprises to "go global". In the project's first phase, the total investment is $2.47 billion. We will renovate about 1,500 kilometers of railway lines, which will cover the central and northern regions of Argentina. For now, all aspects of the work, including supply, transportation and construction, are progressing smoothly.

In late August, manufacturing of the first Chinese-developed wide and metric gauge locomotives to be exported by CMEC to Argentina was completed.

What is the significance of the project in promoting common development for regional economic and social benefit?

This is a key project aiming to revitalize the national economy and reshape Latin America's regional advantages. As it is the lifeline of Argentina's east-west goods transportation, there is an urgent need to repair the aging freight rail infrastructure and renew outdated rolling stock. This railway will form part of South America's railway network, connecting Argentina to Chile, Brazil and other countries, therefore promoting trade interaction among South American countries, and facilitating exploration and transportation of agricultural and mining products along the line. This project will play a positive role in boosting Argentina's domestic employment situation and in maintaining its economic and social stability. This has always been CMEC's concept of social responsibility.

China is Argentina's second-largest trading partner. The two sides have established a mature mode of cooperation. As the "flagship project" of Sino-Argentine cooperation, this project will have a positive effect on China's cooperation with other Lain American countries, further enhancing China's influence in South America and boosting the regional economy.

If we take this project as the base point, is CMEC willing to continue to deepen bilateral cooperation and expand the scope of business in Latin America?

To take root in Argentina, CMEC has formed a relatively mature localization management mode in Argentina. On the one hand, our subsidiary company successfully manages local financing and purchases fixed assets. On the other, our local human resources system has achieved great progress in localizing management, recruitment, and salaries and rewards.

According to the Latin American news agency's report on Aug 1, the Chinese government will provide $25 billion in financing to Argentina in the next five years. This will help Argentina carry out key projects, including hydro, nuclear and solar power, as well as several other major infrastructure projects. CMEC will seize this opportunity by relying on the deep trust and cooperation between the two countries, and by taking advantage of its rich experience in international contracting, equipment procurement and localized management. This will further strengthen and expand our cooperation with Argentina and its neighboring countries.

We believe that CMEC will gain a stronger position in the Latin American market and will be able to make greater contribution to promoting sustainable political and economic development between China and Latin America.

Wan Shumin contributed to this story.