Financing provides a strong impetus for building the ＂Belt and Road＂

　　Prospect of Dasher Gandhi Sewage Treatment Plant in Bangladesh. Deng Junheng

　　A data center in Ghana, Africa invested by Silk Road Fund. The data center is partially powered by photovoltaic. Photo courtesy of Paul Frankish

　　On April 13th, China-Laos Railway, which was mainly invested and built by China, opened international passenger trains from Kunming South Station in China and Vientiane Station in Laos in both directions, and the two places can be reached on the same day by train. The picture shows Lao staff performing for passengers on the train. Xinhua News Agency reporter Xing Guangli photo

　　Responsible for Kaileta, Guinea — Chinese and Guinean employees of the Su-Apithy Operation and Maintenance Project are carrying out survey work on the dam of Kaileta Hydropower Station. Both Kailetai and Su Apithy Hydropower Stations are financed by The Export-Import Bank of China and undertaken by China Water Conservancy and Electric Power Foreign Co., Ltd. Photo by Lu Zhao

　　The teaching, research and referral hospital project of Kenyatta University, supported by preferential loans provided by the government of China and undertaken by Jiangxi, China International Economic and Technical Cooperation Co., Ltd. Photo by Elijah

　　Priority section project of Heishan North-South Expressway supported by The Export-Import Bank of China and undertaken by China Road and Bridge Engineering Co., Ltd. Photo by Lu Xiaochao

　　Financing is an important support for building the "Belt and Road". Most of the countries building the "Belt and Road" are developing countries, and some countries have gaps in construction funds. The financing bottleneck is a prominent challenge to achieve interconnection. Over the past 10 years since the initiative of "Building the Belt and Road" was put forward, China has actively carried out various forms of financial cooperation with countries and relevant institutions, promoted the network layout of financial institutions and financial services, provided strong support for financial cooperation among countries, and also provided a sustainable and powerful impetus for building the "Belt and Road".

　　Investment and financing promote the sustainable development of national economy and society.

　　On October 2nd, in Indonesia, the Jakarta-Bandung High-speed Railway EMU, which was financed by China National Development Bank and jointly built by China and Indonesia, was officially opened. Indonesian President Joko said on his first trip to Jakarta-Bandung High-speed Railway that he felt very smooth and comfortable when the train was running at 350 kilometers per hour. As the flagship project of "One Belt, One Road" cooperation between China and Indonesia, after the official commercial operation of Jakarta-Bandung High-speed Railway, the fastest travel time between Jakarta and Bandung will be reduced from 3.5 hours to 40 minutes, which will bring convenience to people and further release the local economic development potential.

　　On July 13th, in Bangladesh, the completion ceremony was held for the Dasher Gandhi Sewage Treatment Plant project, which was provided with preferential loans by the government of China, financed by The Export-Import Bank of China and jointly built by China and Bangladesh. The project is the first modern large-scale sewage treatment plant in the country and the largest single sewage treatment plant in South Asia so far. As a key project under the framework of "One Belt, One Road" jointly built by China and Bangladesh, the project can treat the domestic sewage of 5 million residents in Dhaka, greatly improving the quality of life of local people. Bangladeshi Prime Minister Hasina said that a sustainable and high-quality modern sewage treatment system is essential for the long-term stability of urban water supply.

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　　In the past 10 years, the two-way investment between China and the co-construction countries has accumulated more than 380 billion US dollars, and more than 3,000 cooperation projects have been carried out to jointly build the "Belt and Road", which has boosted the investment scale of nearly one trillion US dollars. From carlot Hydropower Station in Pakistan to the first garbage power generation project in Bangkok, Thailand; From Abuja Metro Phase I Project in Nigeria to Boccara International Airport in Nepal … … With the support of Chinese investment and financing, many infrastructure, capacity cooperation and eco-environmental protection projects have taken root in building a country together, injecting vitality into the sustainable development of local economy and society and becoming "national landmarks", "livelihood projects" and "cooperation monuments".

　　As a pioneer and an important participant in the Belt and Road Initiative, China has provided important financing support for the high-quality co-construction of the Belt and Road Initiative. Taking China National Development Bank and The Export-Import Bank of China as examples, by the end of 2022, China National Development Bank had directly provided high-quality financial services for more than 1,300 Belt and Road projects, effectively playing the leading role of development finance, bringing together domestic and foreign funds to jointly build the Belt and Road; The balance of The Export-Import Bank of China’s "Belt and Road" loans reached 2.2 trillion yuan equivalent, covering more than 130 co-construction countries. The loan projects have accumulated more than 400 billion US dollars of investment and promoted more than 2 trillion US dollars of trade.

　　The Kenyan Monnet Railway, financed and built by the Chinese side, has driven the local economy to develop continuously, creating tens of thousands of jobs directly and indirectly. Stephen Ndegewa, head of the Kenyan South-South Cooperation Think Tank, said that all the financing loans provided by China to African countries were used to implement specific projects, which really benefited the local people.

　　The space for financial cooperation is expanding in depth.

　　Over the past 10 years, the Silk Road Fund funded by China and the Asian Infrastructure Investment Bank established by China together with relevant countries have provided investment and financing support for hundreds of projects. The investment and financing channels for building the "Belt and Road" have been continuously broadened, the financial service system has been continuously improved, the supply of financial services has been continuously optimized, the investment and financing system and mechanism have been steadily innovated, the space for financial cooperation has been expanded in depth, and a diversified investment and financing system has been gradually established.

　　At present, the number of members of the AIIB has increased from 57 when it was founded to 109, from all over the world. As of October 10th this year, the AIIB has approved a total of 236 projects, with a total approved financing of over US$ 45 billion, driving capital of nearly US$ 150 billion, benefiting 36 members within and outside Asia, becoming a key member of the international multilateral governance system and an important financing platform to promote international development and jointly build the Belt and Road with high quality; Silk Road Fund provides important support for the investment and financing of the "Belt and Road" through a variety of investment and financing methods based on equity. By the end of June 2023, investment projects had spread to more than 60 countries and regions, and 75 investment projects had been signed, with a promised investment amount of about 22.04 billion US dollars; China signed a memorandum of cooperation with the World Bank, the Asian Development Bank and other international financial institutions, and jointly established a multilateral development and financing cooperation center with multilateral development banks, which effectively promoted the participation of market funds and gathered more capital dividends for the joint construction of the "Belt and Road" … …

　　In Tajikistan, key projects such as the municipal road and overpass construction project in Dushanbe, the highway modernization project from Dushanbe to neighboring Uzbekistan, and the Nurek hydropower station project have been comprehensively promoted due to the loan from the AIIB. Sevolo Safarov, former first deputy director of the Tajikistan President’s Strategic Research Center, said that the investment and financing projects of the AIIB directly target the weak links of infrastructure, which is conducive to stimulating local development vitality. "These projects have improved the living standards of local people and changed the country."

　　In the United Arab Emirates, Silk Road Fund participates in the investment of 700 MW photothermal and 250 MW photovoltaic solar power station projects in Dubai through cooperation with Dubai Hydropower Bureau and Saudi International Power and Water Company. After the project is fully put into production, it will provide clean electricity for 320,000 households. The relevant person in charge of Saudi International Power and Water Company said that the company and Silk Road Fund have been actively promoting multilateral cooperation. In November 2018, the two sides jointly invested and established a new energy investment cooperation platform, which provided strong support for many green energy projects such as wind power, photovoltaic and photothermal in West Asia and North Africa, and promoted the green development of countries and regions that jointly built the "Belt and Road".

　　In Nigeria, the third phase of the African Infrastructure Investment Fund (AIIF3), in which Silk Road Fund participated, provided financial support for Nigeria’s clean energy service platform. The platform provided clean energy solutions for business users by improving energy efficiency and renewable energy technologies, which is of great significance to countries with huge power supply needs such as Nigeria. At present, the platform business has expanded from Nigeria to many countries in Africa. Paul Frankish, head of investor relations at AIIF3, said: "The cooperation between Silk Road Fund and us is mutually beneficial and win-win. Both sides share the same investment philosophy, which will enable cooperation to provide more support for the future development of African countries."

　　Enhance the ability to jointly build national financial services.

　　Some major infrastructure projects planned to jointly build the "Belt and Road" countries have a large amount of money and a long term, involving many parties or even multinational entities, which is difficult for a single commercial bank in many emerging market countries to undertake completely alone.

　　As one of the results of the first Belt and Road International Cooperation Summit Forum, under the guidance of the People’s Bank of China, China Industrial and Commercial Bank initiated the establishment of the Belt and Road Inter-bank Normalization Cooperation Mechanism (BRBR Mechanism) to provide support for optimizing the financial supply structure, enhancing the national financial service capacity and promoting the international cooperation. Through this mechanism, member institutions can give full play to their respective advantages and form a joint force to jointly meet the needs of large-scale investment and financing.

　　In terms of investment and financing, the BRBR mechanism gives full play to the advantages of multilateral financial governance and mutually beneficial cooperation platforms, and promotes a large number of key projects to jointly build the Belt and Road Initiative to bear fruit. The renovation and capacity expansion project of Luasim Hydropower Station in Angola has brought clean energy to the local area, effectively alleviating the power shortage; The floating LNG project in kolar, Mozambique, has helped Mozambique become an LNG exporter … … The projects that benefit the people’s livelihood have improved the sense of gain and happiness of the people who build the country together.

　　In terms of capital market, ICBC and members of the BRBR mechanism have successfully issued seven BRBR green bonds, raising more than 14 billion US dollars, and actively playing the role of debt capital market in resource allocation in supporting the "Belt and Road" construction.

　　In terms of theoretical research and standard rules, the BRBR mechanism has published many research results, such as "Research Report on the Belt and Road Green Finance (Investment) Index" and "Research Report on Financial Information Disclosure in Transition", which provides important reference indicators and excellent practical experience for the investment decision of building the Belt and Road.

　　At the same time, the BRBR mechanism held a number of capacity-building and special training activities to strengthen capacity-building and rally consensus among members. By the end of September, 2023, the BRBR mechanism had been extended to 164 member and observer institutions in 71 countries and regions, which effectively promoted the open business interaction, symmetrical information exchange and effective allocation of funds among financial institutions in countries that jointly built the Belt and Road Initiative, and jointly improved their business capability and risk management level.

　　In the past 10 years, the financial cooperation mechanism for building the "Belt and Road" has become increasingly sound, and the ability to finance has been further improved. China, together with relevant parties, formulated the Guiding Principles for the Belt and Road Financing and issued the Analysis Framework for the Sustainability of the Belt and Road Debt, which provides guidance for the joint construction of the Belt and Road financing cooperation. China has signed bilateral local currency swap agreements with 20 co-construction countries, and established RMB clearing arrangements in 17 co-construction countries. The number of participants, business volume and influence of RMB cross-border payment system have gradually increased, and the scale of local currency swap and cross-border settlement has continued to expand, effectively promoting trade and investment facilitation. At the same time, the financial supervision cooperation between China and the Co-construction countries has been continuously strengthened, a regional efficient supervision coordination mechanism has been established, the framework of financial crisis management and disposal has been improved, and the ability to jointly cope with financial risks has been improved.