no.3 sep, 2015...no access to power. the domestic wind turbine installed capacity of 2,036 mw is...

VOL.33NO.3 Sep, 2015

SINOMACH VOICE

At the interim working meeting, Ren Hongbin, the Chair-man of SINOMACH stressed the necessity and importance

of “secondary entrepreneurship” after announcing the strategic concept at the working meeting at the year beginning. Why will SINOMACH, which now stays at a stable growth stage, need “sec-ondary entrepreneurship? In one word, it is an internal change pro-cess to seek a further development after SINOMACH has realized a rapid growth.

What should we do to make this happen?

Don’t deny and don’t imitate without change. Secondary entrepre-neurship does not mean denying the past and simply starting from the beginning again, or does not mean refusing to change with the time and going the old way. SINOMACH has gradually seen some problems that have accumulated during the growth and will hinder our further development. We should seek a further development in a creative manner based on our own characteristics while inheriting the good.

Don’t linger on the past or reply on anybody. In concept, secondary entrepreneurship requires us not to linger on or rely on the achieve-ments we have made in the past, and requires us to give up the fluke mind of being content with where we stand now, and shake off the confusions and fears when we see difficulties coming ahead of us. In method, many old weapons will no longer work, and we

must use transformation, upgrade and other new weapons to attack those firm barriers that have always stopped our pace to go ahead. It will measure our development status for years in every aspect.

Focus on innovation and quality. Secondary entrepreneurship will require the change in our view of world and the change in our methodology. The success of our secondary entrepreneurship will depend on the update of concepts of the leadership and depend on the evolution from the stress of scale to the stress of benefit, the evolution from the domestic vision to the international vision, the evolution from “assets” to “capital”, the evolution from tradition-al industries to modern industries, and the evolution from “low end” to “high end”. The core task is not only to upgrade the brand, enhance quality and improve the innovative capacity, but also to establish a scientific management system, refine the modern enter-prise system, upgrade the economic structure, eye a bigger market and realize a growth with quality.

After the robust growth over the past years, some enterprises have made a preliminary effect on the way to secondary entrepreneur-ship, some are full of the impulse for “secondary entrepreneur-ship”, but some enterprises still waste time during hesitation. Now, the horn has blown and the strategy has become clear. Secondary entrepreneurship will call for more people who do more than say-ing, and require more people to take bigger, faster and more stable steps.

We Should Act for Secondary Entrepreneurship

YOUR RELIABLE PARTNER

1

Three Main BusinessR&D and ManufactureProject ContractingTrade and Services

Market PositionRanked 278th among Fortune Global 500Ranked 1st among China’s Top 100 Enterprises in Machinery IndustryRanked 25th among Top 250 International Contrac- torsRanked 72nd among Top 225 International Design FirmsRanked 17th among China’s Top 500 Foreign Trade EnterprisesRated as Class A in central enterprise performance appraisal

This publication is intended for no commercial purpose but for internal exchange only.

Internal magazine for free subscription and all rights re- served. Written permission is required for the reprint of any part or the whole of the content in the magazine.Part of the picture source: Getty Images

PublishPublished by:China National Machinery Industry CorporationWebsite: www.sinomach.com.cnAddress: No.3 Danling Street, Haidian District, Beijing, China 100080Tel: (86-10) 8268 8888Fax: (86-10) 8268 8811

Members of Editorial BoardEditor-in-Chief: Shi KeDeputy Editor-in-Chief: Xie BiaoChief Editor: Su WeikeExecutive Chief Editor: Chen XingxiangEditor: Zhang Shaochen Mao Weiyang

Editorial DepartmentTel: (86-10) 82606725, 82688727Fax: (86-10) 82688724Editorial Company: Beijing Prominion Publishing Co.,Ltd.Design: Beijing Prominion Publishing Co.,Ltd.E-mail: [email protected]

CONTENTS

FOCUS POINTS PROJECT PROGRESS

TRADE AND SERVICES

SINOMACH OVERSEAS

Cooperation between SINOMACH and GE for Clean Energy Development in Africa

SINOMACH Realized Obvious Profit Growth in 2015 H1

SINOMACH Bags Awards in A Harvest Season

Ren Hongbin Visits Serbian President SINOMACH Boosts Energy Development in Serbia

Ren Hongbin Invited to Attend the19th St. Petersburg Inter-national Economic Forum

SINOMACH Capital Holds the Inauguration Conference and the First Shareholders’ Meeting Successfully

SINOMACH Publishes 2014 CSR Report

Chinese Missions Visit China-Belarus Industrial Park

SASAC Publishes “Roadmap for Chinese Enterprises along The Belt and Road”

2015 Interim Report on Chinese Economy

Devaluation of Renminbi Will Stimulate China’s Export of Products

04

06

07

08

09

10

11

12

13

14

15 18

18

19

22

24

24

16

16

17

17

First Result of Internal Cooperation under “Export Multipli-cation” Project of SINOMACH Riser Hammer Creates the First in China

SUMEC Firman Generating Set Boosts 2022 FIFA World Cup Qatar

BHI Boosts 2022 Winter Olympic Games with High-speed Cable Car Project of Wanlong Ski Resort

Driving Dream and Conveying Hope in Africa: 2015 SU-MEC Firman Children Care Plan

CAMCE Belarus 400,000t Pulp Project Donates Medical Equipment

CAMEC Myanmar Representative Office Actively Partici-pates in Flood Aid Action in Myanmar

Ecuador President Rafael Correa Delgado Visits Hospital Project Undertaken by CMEC

CMEC Signs Contract on First Foreign Aid Package Project

CUC Wins the Permanent Venue Project of United Nations International Forum on Geographical Information

SIPPR Signs EPC Contract on Laotian Tobacco Project

SINOMACH SUBSIDIARY

25 CMEC’s Distinctive Way of Transnational Operations

Cooperation between SINOMACH and GE for Clean Energy Development in Africa

SINOMACH and GE signed a memo-randum of understanding on strategic

cooperation in Beijing on September 16. Ren Hongbin (President of SINOMACH) and Duan Xiaoying (GE Global Senior Vice President, President and CEO of the Greater China Region) attended the signing ceremo-ny for agreement signing. The parties will jointly promote the development of clean en-ergy projects in Africa to help realizing the goal of doubling the population with access to power in Sub-Saharan Africa and support-ing “The Belt and Road” strategy of Chinese Government and the “Power Africa” of the US Government.

The clean energy project of SINOMACH and GE was listed as one of the three proj-ects with substantial achievements in the

pragmatic and trade economic cooperation between China and the US before President Xi’s visit to the US. In the press conference held by the Office of the Central Leading Group on Financial and Economic Affairs (OCLGFEA) with the attendance of National Development and Reform Commission, the Ministry of Foreign Affairs and the Ministry of Commerce etc. on September 17, Shu Guozeng, Vice Director of the OCLGFEA, pointed out that: “As the important topic of President Xi’s visit to the US, economic co-operation is and will always be the ‘anchor’ and ‘propeller’ of China-US relation. China and the US enjoy great economic comple-mentarity. Therefore, their cooperation in key projects is the foundation and support for the promotion of pragmatic and trade economic cooperation between China and the US and will help to enrich the economic dimension of China-US relations.”

According to the agreement, SINOMACH and GE will cooperate in the following three aspects: firstly, joint development, invest-ment and financing in clean energy projects in Africa to enhance their cooperation in energy; secondly, mutual help in obtaining and optimizing third-party long-term financ-ing or providing development funds to each other in specific energy cooperation projects; thirdly, taking Kipeto 102 MW Wind Pow-er Project in Kenya as the pilot project for long-term cooperation.

Kipeto 102 MW Wind Power Project in Kenya is a project under “Power Africa” of the US government, and GE invited SINOMACH in the construction of the proj-

ect through the international financing chan-nels to enhance their cooperation in Africa.

SINOMACH is the leading enterprise among the top 100 enterprises of machinery indus-try in China and is also the biggest import/export enterprise in the machinery industry in China and one of the world’s largest in-ternational project contractors. GE is the largest conglomerate in the world and en-joys a sound basis for the cooperation with SINOMACH: they have jointly constructed many infrastructure projects in Asia, Afri-ca and Latin America. The combination of advanced equipment of GE like gas turbine and wind turbine etc. with the engineering construction and project management capa-bilities of SINOMACH will provide a reli-able guarantee for the clean energy projects over the world.

Ren Hongbin said that: “In recent years, centered on technology and management innovation, SINOMACH has accelerated the space of ‘going global’ and promoted strategic restructuring, successfully realizing the transformation from a traditional state-owned enterprise to a modern enterprise with international competitiveness. During the implementation of ‘The Belt and Road’ strategy, we enhanced the cooperation with GE in power construction in Africa and other emerging markets; it is the new idea and mode in the joint development of the third-party market by enterprises in China and the US for mutual benefits, and also the best interpretation of the SINOMACH’s phi-losophy: ‘Work Together, Win Together’.”

Duan Xiaoying said: “GE is a reliable co-operation partner in ‘going global’ of infra-structures and equipment for China, and our cooperation fully embodies the strategy of ‘From China, For the World’, and the core of the strategy is developing the global mar-ket together with China; GE will provide advanced technology, global resources and management experiences for SINOMACH and other overseas contractors in China to promote cooperation among more enterpris-es from China and the US in global develop-ment and innovation through complementar-ity in technology and capacity.”

The economic development in Africa boosts the increasing clean energy demands. How-ever, 80% of the population in Kenya has no access to power. The domestic wind turbine installed capacity of 2,036 MW is expected for Kenya as of 2030. Located at the south (about 50 km from) of Nairobi, the Capital of Kenya, Kepito Wind Power Project has an installed capacity of 102 MW and is equipped with 60 sets of 1.7-103 wind turbines produced by GE. The Project will significantly improve the power supply capacity of Kenya. SINOMACH will be the contractor of Kepito Project while GE will provide wind turbines, generators, accesso-ries, technical support and training for the Project.

SINOMACH signed a memorandum of understanding to jointly promote the

development of clean energy projects in Africa. Kipeto 102 MW Wind Power Project in Kenya will be the pilot project for long-

term cooperation. The further cooperation between the two world’s leading enterprises promotes a

new economic cooperation idea and mode between China and America.

SINOMACH and GE will cooperate in the following three aspects:

Located at south (about 50 km from) of Nairobi

SINOMACH will be the contractor of Kepito

Project while GE will provide wind turbines,

generators, accessories, technical support

and training for the Project.

The Project will significantly improve the

power supply capacity of Kenya.

Kepito Wind Power Project

Firstly, joint development, investment

and financing in clean energy

projects in Africa to enhance their

cooperation in energy

Secondly, mutual help in obtaining

and optimizing third-party long-term

financing or providing development

funds to each other in specific energy

cooperation projects

Thirdly, taking Kipeto 102 MW Wind

Power Project in Kenya as the pilot

project for long-term cooperation

102 MW 60 sets

Installed capacity of 102 MW

Equipped with 60 sets of 1.7-103 wind turbines

produced by GE

SINOMACH has developed in Africa

engineering market, especially power

market, for over a decade, and has

invested and contracted nearly 20

projects in power station projects with

a total installed capacity of 3000 MW; it

achieved good performances and enjoys

good reputation in Africa power market.

Based on the international engineering

project platform of CMEC, SINOMACH

has cooperated with GE in large scale

projects with total value of over USD 3

billion. At present, teams from the two

parties are following the projects they

have developed, and it is shown that

projects merely in Africa value over USD

2.7 billion.

20 projects

USD 3 billion

3000 MW

USD 2.7 billionCMEC

Profile

54

FOCUS POINTS FOCUS POINTSPROJECT PROGRESS TRADE AND SERVICES SINOMACH OVERSEAS SINOMACH SUBSIDIARY

SINOMACH Bags Awards in A Harvest Season

SINOMACH Realized Obvious Profit Growth in 2015 H1

World top 500 enterprises

288thChina top 500 enterprises

56th

Top 225 international engineering and design

companies

27th

Enterprises

Alevel

SINOMACH Ranks 288th among the Latest Fortune World Top 500

On July 22, the Fortune maga-zine published the list of 2015 world top 500 enterprises world-wide, and SINOMACH comes in the 288th place with the op-erating revenue of USD39,722 billion. So far, SINOMACH has ranked among the world top 500 list for five consecutive years.

In 2014, SINOMACH focused on assuring stable growth, de-spite the severe and complex economic situations at home and abroad as well as the tough reform and development tasks. It increased the operating reve-nue and the profit by 2.8% and 26.7% respectively, and hit a new historical high.

SINOMACH Ranks 56th among China Top 500 Enterprises

On August 22, China Enterprise Confederation published the 2015 China top 500 enterprises list, and SINOMACH ranks the 56th with theoperating revenue of RMB244,749 billion.

Of the top 500 enterprises, state-owned enterprises still represent the dominant force, and 293 state-owned enterprises take a s hare of some 80% in revenue, assets, profit and tax.

SINOMACH Rated as Level A Excellent for Seven Consecutive Years

On June 23, the State-owned Assets Supervision and Admin-istration Commission of the State Council announced the list of level A enterprises after the performance evaluation of the leaders of the central enterprises in 2014, and SINOMACH is rated as a level A enterprise for seven consecutive years.

SINOMACH Reaps A Good Harvest at ENR

In August, the Engineering News Record of America pub-lished the ranking of top 225 international engineering and design companies in 2015, and SINOMACHcomes in the 62nd position, a rise of 10 positions over last year. At the same time, the ENR has disclosed the world top 250 international contrac-tors, and SINOMACH comes in the 27th place.

SINOMACH implemented theoverall action plan to drag China National Er-

zhong Group Co. (CNEG) out of loss and plight, concentrated the force of the entire Group to help CNEG carry forward there-form, and made an effect on eliminating the debt risk, mobilizing assets,reforming internal management, adjusting thebusiness landscape, and strengthening synergy.

SINOMACH has forged a good business foundation in the countries and regions along “The Belt and Road” and gained 27 projects involving a total contract value of USD 18 billion and covering 35 countries in the 65 countries and regions (excluding China) along the “The Belt and Road”.

In 2015 H1, SINOMACH doubled the ex-port value to USD 190 million. The figure was USD 350 million in 2014 and USD 310 million in 2013.

Growth Defense War

CNEG Defense War

International Operation

In H1, SINOMACH realized an EVA of RMB

455 million, a rise of 153.8% year on year;

made a totalprofit of RMB3.012 billion, a

rise of 11.9% year on year; and realized

operating revenue of RM B 104.17 billion.

Fulfillment of Major Evaluation Indicators Set by SASAC

CNEG Overall Action Plan for Beating Loss and Tiding over the Plight

Business foundation for “The Belt and Road”

Fulfillment of Major Evaluation Indicators Set by Board of Directors

EVA

EVA

EVA

Total profit

Total profit

Total profit

Cost-income ratio Turnover rate of current assetsRMB

455 millionRMB

3.012 million 97.33% 0.552T1 RMB 100 million T1 RMB 4.35 billionT2 RMB 270 million T2 RMB 5 billion

Evaluation value: 98.11%

Evaluation value: 1.33

SINOMACH

Former SINOMACH

Completed

34%

60%

42%

Slash balance sheet ratio

Reduce future financial cost and cash outflow

Increase non-recurring revenue in current period

Greatly boost confidence

Business involves

35 countries

270 projects under

implementation

Contract value:

USD 17.93 billion

Significant Progress Made with Restructuring of Bank Debts up to RMB 12.138 Billion

Repay debt and interest with sharesCashReserved debt

9.038 billion

1.6 billion

USD 190 million

USD 310 million

USD 350 million

1.5 billion

2013 2014 2015 H1

0706


Ren Hongbin Visits Serbian President SINOMACH Boosts Energy Development in Serbia

Ren Hongbin Invited to Attend the 19th

St. Petersburg International Economic Forum

On August 30, Ren Hongbin visited Ser-bian President Tomislav Nikoli, who

came to China to participate in the military parade for 70th anniversary of the Victory the Chinese People’s War against Japanese Aggression and World Anti-Fascist War.

Ren Hongbin reported the progress of the first and second phases of the Kostolac Pow-er Station Project in Serbia as well as the preparation for the Kragujevac Meat Pro-cessing Factory Project to the President, and acknowledged the Serbian government and Mr. President for the constant support and help for SINOMACH and CMEC’s work in Serbia. President Tomislav Nikoli welcomed SINOMACH and CMEC for investing in Serbia, and expected both parties would cooperate in more areas. After the meeting, CMEC General Manager Zhang Chun and Mr. Radomir Nikoli, the Mayor of Kraguje-vac City of Serbia, signed the memorandum of understanding of the Kragujevac Meat Processing Factory Project, witnessed by President Tomislav Nikoli and Ren Hongbin.

In fact, SINOMACH has frequently interact-ed with President Tomislav Nikoli. On June 22, both sides held an interview in Serbia. During the interview, the Serbian President specially asked the mayor of Kraljevo, the second largest city in the country, to join the interview and brief the development plan-ning of the city. Ren Hongbin advised the Serbian side with his opinions and sugges-tions on the planning projects and plans.

SINOMACH has cooperated with Serbia in many projects. For example, China Ma-chinery Engineering Corporation (CMEC), a subsidiary of SINOMACH, has built the Kostolac thermal power station, the largest energy project in the country in 20 years.

With the contract signed in 2013, the power station contributes 11% of the total power generation of the country, and before that, Serbia had not built new power stations for over 20 years. As the EPC contractor, CMEC has undertaken the first phase of the project, including the overhaul and desulfurization

upgrade of two 350 MW generating sets of Plant B of the power station, the expansion of the current coalmine and the building of a new generating set in the power station. On December 29, 2014, the B1 generating set successfully realized grid connection and power generation at one time.

Based on the amicable cooperation in the aforesaid project, the contract on the second phase formally took effect on May 25, 2015. The work of the project includes build-ing one new 350 MW supercritical coal-fired unit (B3) and expanding the affiliated opencast coalmine. As the EPC contractor, CMEC will build the project as a turnkey project and take on design, supply, civil con-struction, installation, training, commission-ing, quality warranty and other work. The project contract involves a total amount of USD 715.6 million and a construction period of 58 months.

The project is the first power station project CMEC, which has executed within Europe and built up to the emission standard of the European Union. After completion, the proj-ect will mitigate the tight power supply in the local region to a big extent.

It is worth mentioning that CMEC is the first Chinese enterprise that has successfully penetrated into Serbia’s electricity market, and the project is also the first power project China has undertaken in the EPC mode in Europe, and will provide an opportunity for China’s thermal power technology, equip-ment and standardtobe recognized and pro-motedin Europe.

On June 18-20, SINOMACH Chairman Ren Hongbin, the Chinese President

of the China-Russia Bilateral Entrepreneurs Council, was invited to attend the 19th St. Petersburg International Economic Forum, which took place in Russia. During the fo-rum, Ren Hongbin met the Russian President Timchenko of the Council, and both parties exchanged views on the working mecha-nism, cooperation mode and recent activities of the Council.

The St. Petersburg International Econom-ic Forum is an event where leaders of the new economic powers meet, and mainly discusses economic issues faced by Russia, the emerging markets and the entire world. Chinese Premier Zhang Gaoli of the State Council attended the forum and delivered a speech entitled “Promoting Stable Growth of the World Economy through Openness, Cooperation, Innovation and Develop-ment”. More than 10,000 people from 120 countries and regions attended the forum and created a new record for participants.

During the three-day forum, 205 cooperation agreements were signed and involved a total value of up to RUB 293.4 billion (roughly USD5,453 million), excluding contracts in-volving business secrets.

SINOMACH and Russia maintain close re-lations, and cooperate in power generation equipment, lathe process and other areas in depth. In March, 2013, SINOMACH-HI (Luoyang) Co., Ltd. opted to make an international debut of its YD230 bulldozer in Russia, and exhibited the product at the 14th International Specialized Exhibition Construction Equipment and Technologies (CTT). In May, 2014, CAMCE, a member of SINOMACH, signed the commercial contract involving a total amount of USD 175,419,000 on the reconstruction project of the Russian cement plant with Russia’s Eu-rope Cement Plant Group.

A series of classic cooperation cases prove SINOMACH is now joining hands with Rus-sian counterparts to win a good future together.1.Ren Hongbin Shakes Hands with Serbian President Tomislav Nikoli

2.Ren Hongbin Visits CMEC Kostolac-B Power Station Project Site in Serbia1 2

A series of classic cooperation cases

prove SINOMACH is now joining

hands with Russian counterparts to

win a good future together.

Power generation equipment

Lathe process

SINOMACH and Russia maintain close relations

0908


SINOMACH Capital Holds the Inauguration Conference and the First Shareholders' Meeting Successfully

On July 16, SINOMACH Capital Holding

Co., Ltd. (SINOMACH Capital) held the

inauguration conference and the first sharehold-

ers’ meeting, the first meeting of the First Board

of Directors, as well as the first meeting of the

First Board of Supervisors at SINOMACH Head-

quarters. With the registered capital of RMB 2.37

billion, SINOMACH Capital was sponsored by a

total of 19 shareholders, including SINOMACH,

CCB Principal Asset Management Co., Ltd. and

some enterprises under SINOMACH.

SINOMACH Capital was established with a pro-

found historical background. Internationally, the

world economy has started profound adjustment

and rebalances, all countries are now accelerat-

ing the pace to boost the technical and industrial

revolution, and the global industrial structure

embraces a further adjustment. Domestically,

the Chinese economy will need to deepen the

industrial restructuring and realize industrial

transformation and upgrade as a top priority while

stabilizing the growth rate. Judging from the in-

dustry of SINOMACH, the growth momentum of

the equipment manufacturing industry has fallen

down. Stressed by the pressure from restructuring,

transformation and upgrade, it is now a trend that

the profit of the industrial chain will shift to high-

end enterprises controlling core technologies and

having core competitive strengths in either project

contracting, engineering design, import & export

trade, or research and manufacturing. Therefore, it

is a strategic move of SINOMACH to adapt to the

time.

Now, the investment focus of SINOMACH Capi-

tal will mainly depend on the potential growth of

the industry and company. At present, the strategic

and emerging industries such as new materials,

new energies and industrial robots embrace a good

prospect, and relevant business segments inside

SINOMACH are growing quickly and will pos-

sibly become the areas SINOMACH Capital will

invest in next step.

Undoubtedly, “The Belt and Road” policy will

create vast opportunities for SINOMACH in

international project contracting and export of

mechanical equipment, and SINOMACH Capital

will capitalize on rich resources of the group to

play an active part in high-quality overseas proj-

ects. The transformation in the business model

for international contracting will create a growing

demand for project investment and capital oper-

ation, which will also constitute a big bonaza for

SINOMACH Capital.

In future, SINOMACH Capital will rely on in-

ternal and external resources of the Group, and

build an industry-financing integrating platform,

a comprehensive financial operation platform and

an emerging & strategic industry investment plat-

form. It will play a role in promoting internal syn-

ergy within the Group, industrial transformation

and upgrade, explore and innovate development

patterns, and become a first-class industrial and

financing capital holding company in China.

SINOMACH Publishes 2014 CSR Report

Compared to the past CSR reports, the report this year is new in three aspects.

Firstly, the contents of the report better tal-ly with the reporting trend of world-class enterprises. The report highlights the theme of “innovating international operation and building a new overseas SINOMACH”, echoes the significant strategy “The Belt and Road Initiative” of the government, makes data more comparable and actively responds to the appeals of the stakeholders. At the same time, the report is written in the easier-to-understand language by telling stories about corporate social responsibility.

Secondly, the report highlights the cultural attributes of SINOMACH. Revolving around the core value of “joining forces for innova-tion and win-win”, the responsibility man-agement model focuses on three principal business segments and five dimensions, and renders a unique performance information disclosure system. Thirdly, the report pays more attention to communication values of the responsibility brand. The report introduc-es the H5 light application version, which jointly exerts the communication effect with traditional internal and external media tohelp continuously enhance the brand image of SINOMACH.

53%

34%

13%

17 tier-2 companies

SINOMACH

CCB Principal Asset Management

RMB 1.27 billion

RMB 800 million

RMB 300 millionRegistered capital: RMB 2.37 billion

SINOMACH has formally disclosed its 2014

Corporate Social Responsibility Report

of China National Machinery Industry

Corporation. It is the fifth CSR report

SINOMACH has disclosed. The report

contains 106 pages, more than 40,000

Chinese characters and over 80 pictures.

Combining cases, pictures, charts and other

forms, the report systematically records

the efforts and outstanding progress

SINOMACH made in the economic, social

and environmental areas in 2014.

SINOMACH of responsibility

SINOMACH of happiness

SINOMACH of value

SINOMACH of innovation

SINOMACH of green

1110


Chinese Missions Visit China-Belarus Industrial Park

On July 13, the project site of the indus-trial park received a mission headed by

Luo Huining, Secretary of the CPC Qinghai Committee; and on July 14 and 15, the park received the missions led by Feng Yaqiang, Director of the United Front Work Depart-ment of the CPC Hebei Committee and Fan Zhaobing, a Member of the Standing Com-mittee of the CPC Hebei Province and Di-rector of the United Front Work Department of the CPC Hebei Committee respectively. They asked some questions about the over-view and investment promotion of the park.

Over the past half year, the industrial park has made many significant progresses. For example, it has introduced China Merchants Group as the strategic investor, which has reinforced the strength of the Chinese share-holder. On August 13, the joint venture run-ning the industrial park held the 17th general meeting of shareholders in Minsk, the capital of Belarus. The meeting is the first general meeting of shareholders of the industrial park after China Merchants Group became a shareholder of the park.

At the same time, China-Belarus Industrial Park Development Co., Ltd. has hosted 9 investment promotion events in Hang-zhou, Chengdu, Shenyang, Shanghai, Shi-jiazhuang, Xi’an and other cities. These events have received more than 300 enter-prises and over 500 participants, and made a good effect. Besides, in H1, the park signed the access agreements with 7 enterprises, including China Merchants Group, YTO Group Corporation, Zoomlion Heavy Indus-try, ZTE, Huawei, Xinzhu Corporation and Belarus Nano Pectin Corporation, and signed the agreement of access intent with 18 enter-prises, including China Foma Group, CITIC Construction and Fiberhome Technologies Group.

In particular, on May 12, Chinese President Xi Jinping and Madam Peng Liyuan visited the China-Belarus Industrial Park, attended by Belarus President Lukashenko, which has made the industrial park attract much atten-tion.

Next step, the park will still focus on invest-

ment promotion and completion of infra-structure construction.

As to investment promotion, the park will actively coordinate with local land, industry and other authorities of Belarus and catch time to attract the landing of enterprises that have signed the access agreements during the high-level visit. Meanwhile, it will visit and promote enterprises that have the intent to access the park and the plan to invest in the park, deepen the understanding and awareness of the park and Belarus among enterprises, and accelerate the decision-mak-ing progress of enterprises. Finally, the park will visit major investment provinces in a planned manner, continue to enhance the awareness and attention to the park among Chinese enterprises and promote more enter-

prises to survey the park and invest there.

As to infrastructure construction, the park operator has explicitly set the key time mill-stones, and will complete the road and pipe-line network in the startup area by the end of this year, according to the current plan.

By the end of next year, it will complete all the infrastructures, associated office towers and standard workshops in the startup area. Now, the park is carrying forward the proj-ects as planned, and can complete various infrastructures on time, and assure the first enterprises will smoothly settle down and start construction in the park.

In July, the News Center of the State-owned Assets Supervision and Administration Commission (SASAC) of the State Council published

the Roadmap for Chinese Enterprises along The Belt and Road (H5 Page), which reviews the current status of the central enterprises on the way to “go global” in an all-round manner, and in particular, exhibits the force of the central enterprises to create prosperity along the “The Belt and Road” in a tridimensional and visible way. The roadmap consists of six parts, including “Traffic Silk Road”, “Ocean Silk Road”, “Air Silk Road”, “Energy Silk Road”, “Electricity Silk Road” and “Information Silk Road”, and covers a multitude of areas like traffic, shipping, avia-tion, energy, electricity and communication.

The state-owned enterprises play a dominant role along the “The Belt and Road” when Chinese enterprises are “going global”. The H5 page of the Roadmap employs the form of presentation of “dynamic image + link”, and marks the locations of important projects and construction projects on the world map. Users can click points, lines and buttons on the map to view relevant text description. The tridimensional roadmap renders a grand and aesthetic visual effect, and exhibits the force and contribution of the central enterprises along the “The Belt and Road” in a tridimen-sional manner.

SASAC Publishes “Roadmap for Chinese Enterprises along The Belt and Road”

The progress of the China-Belarus Industrial Park has caught

eyeballs from the Chinese governments and enterprisesandrecently

received twodomestic missions visiting the park.

Next step,the park will still focus on

Investment promotion

Completion of infrastructure construction

Catch time to attract the landing of

enterprises that have signed the access

agreements during the high-level visit

It will visit and promote enterprises that

have the intent to access the park and the

plan to invest in the park

Visit major investment provinces

Explicitly set the key time nodes

Will complete the road and

pipeline network in the startup

area by the end of this year

1312


2015 Interim Report on Chinese Economy

In H1, China realized the GDP of RMB 29,686.8 billion, an increase of 7.0% year on year. By quarter, the GDP grew 7.0% in Q1 and Q2 respectively. By industry, the prima-ry industry realized a value-added of RMB 2,025.5 billion, a rise of 3.5% year on year, the secondary industry realized a value-add-ed of RMB 12,964.8 billion, a rise of 6.1% year on year, and the tertiary industry real-ized a value-added of RMB 14,696.5 billion,

On August 11, the People’s Bank of China (PBC) published the An-nouncement on Refining the Quotation of the Middle Exchange Rate

of Renminbi against the US Dollar, saying that “the People’s Bank of China [Microblog] has decided to refine the quotation of the middle exchange rate of Renminbi against the US dollar to strengthen the extent of liberaliza-tion and benchmark of the middle exchange rate”. The change has quickly triggered a huge shockwave. From the publishing day to August 13, the exchange rate of Renminbi against the US dollar rose once and again, and Renminbi was cumulatively devalued by nearly 4.7% in threedays.

It is a part of the liberalization reform of the Renminbi exchange rate re-gime to refine the quotation of the middle exchange rate and will help fur-ther strengthen the elasticity of the Renminbi exchange rate. Meanwhile, it will also help mitigate the downward pressure of the Chinese economy and promote the realization of the preset economic growth objectives. In H1, China realized an export value of RMB 6,572.2 billion, a rise of only 0.9% year on year, and the market generally believes a weaker Renminbi will deliver a positive influence on the export of Chinese enterprises.

In H1, the industrial enterprises above the designated size realized a total profit of RMB2,844.18 billion, a fall of 0.7% year on year, which narrowed by 0.1 percentage point compared to that in January to May. In H1, of the industrial enterprises above the designated size, the state-controlled enter-prises realized a total profit of RMB 598.02 billion, a fall of 21.2% year on year, the col-lectively-owned enterprises realized a total profit of RMB 23.53 billion, a fall of 0.1% year on year, the joint-stock enterprises real-ized a total profit of RMB 1,855.26 billion,

In January to June, the machinery industry realized a revenue of RMB 10.73 trillion, a rise of 3.47% year on year, from the princi-pal operation. During the period, the industry realized a total profit of RMB 714.5 billion, a rise of 0.13% year on year.

However, the industry still outperformed the national industry by 2.07 and 0.83 percentage

a rise of 8.4% year on year.

In H1, the total import and export value add-ed up to RMB 11,531.6 billion, a fall of 6.9% year on year. The export value came at RMB 6,572.2 billion, a rise of 0.9% year on year, and the import value stood at RMB 4,959.4 billion, a fall of 15.5% year on year. The trade surplus was RMB 1,612.8 billion.

a fall of 1.7%, the enterprises with foreign, Hong Kong, Macau and Taiwan investments realized a total profit of RMB 721.67 billion, a rise of 4.2%, and the private enterprises realized a total profit of RMB 977.13 billion, a rise of 6.3% year on year.

In H1, the industrial enterprises above the designated size realized a revenue of RMB 51,820.23 billion, a rise of 1.4% year on year, from the principal operation, and in-curred a total cost of RMB 44,565.3 billion, a rise of 1.5%, for the principal operation.

The GDP grew 7% and the trade surplus

kept rising

The profit growth rate of industrial

enterprises fell down obviously

The total profit of the machinery manufacturing

industry edged up

points in terms of the growth rateof revenue from principal operation and profit.

In January to June, the machinery industry realized a total foreign trade value of USD 332.7 billion, a fall of 4.3% year on year, where the import value was USD 138.2 bil-lion, a decline of 11.38% year on year, with the decline gradually deepening month by

month. The export value hit USD194.5 billion, a rise of 1.46% year on year, with the growth rate falling down month by month. However, in the month, the export value beat a negative growth to return to a positive growth of 0.73% year on year, and the extent of decline narrowed by 1.99 percentage points compared to the previous month.

Devaluation of Renminbi Will Stimulate China’s Export of Products

7.0%

21.2%

0.1%1.7%

4.2%

6.3%

7.0%

3.5%

6.1%

8.4%

Q1

Q2 prim

ary industry

state-controlled enterprises

collectively-owned

enterprises

joint-stock enterprises

enterprises with foreign,

Hong Kong, M

acau and Taiw

an investments

privateenterprises

GDP of RMB 29,686.8 billion, an increase of 7.0%

secondary industry

tertiary industry

Renminbi was cumulatively devalued by

nearly 4.7% in three days

Devalued 4.7%

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Surveys

On June 1, CMEC signed the contract on the Power Transmission Project of the China-Be-larus Industrial Park, a foreign aid project, with Minsk Energy, the local energy carrier in Belarus. The project is the first foreign aid package project CMEC has won, and represents a milestone in the history of CMEC.

The Chinese government will provide a foreign aid to fund the project. The major contents of the project include building one 110/10kV substation, building one 110 kV dual-loop line as the supporting facility, dismantlingone existing single-loop 110 kV overhead line, and simul-taneously building one 110 kV single-loop overhead line. The contract involves an amount of RMB 90 million and a construction period of 13 months.

SIPPR Engineering Group Co., Ltd. (SIPPR) has recently won the EPC contract on the first phase of the tobacco industry project of Lao International Tobacco Group Co., Ltd. (Lao Tobacco). It is the first EPC project SIPPR has successfully bidden in Laos.

Lao Tobacco is the only large tobacco pro-duction, supply and sales company special-izing in tobacco planting, seed breeding, sprout cultivation, picking, plant destruction after picking, gradation, package, tobacco leaf and scrap processing, cigarette produc-tion, technical training, instruction, admin-

China United Engineering Corporation (CUC) has recently received the invitation to participate in the design of the permanent

On the morning of August 11, Ecuador President Rafael Correa Delgado visited the site of a large hospitalproject un-dertaken by CAMCE in Ecuador. Since 2007, the government of Ecuador has seen health and medical service as the top priority of the government’s work. The new government hopes to scale up the medical budget and improve the medical service. It has earmarked more than half of the government’s budgetary revenue for the medical service.

CMEC Signs Contract on First Foreign Aid Package Project SIPPR Signs EPC Contract on Laotian Tobacco Project

CUC Wins the Permanent Venue Project of United Nations International Forum on Geographical Information

Ecuador President Rafael Correa Delgado Visits Hospital Project Undertaken by CMEC

Newly signed

With a construction period of 3 years, the

project is scheduled for completion and

put into use in 2018. After completion, it

will become the first-class exhibition and

convention center, which is international,

ecological, scientific and laden with Chinese

cultural elements. It is expected to become

the Boao Forum in the geographical

information circle.

istration, tobacco leaf purchase, import and export. The first phase of the project involves a total investment of USD 29.60 million. Considering the size of the project and the benefit it will create after operation, the governments of China and Laos have paid much attention to the project and great-ly supported the preparatory work, which has assured smooth signing of the project contract.The contract is an important sup-plement to SIPPR’s domestic market, and will set an important example to develop the international EPC business by capitalizing on “The Belt and Road Initiative”.

venue for the China-United Nations Interna-tional Forum on Geographical Information as the lighting design advisor. The forum is

an important platform where the countries worldwide strengthen coordination and cooperation under the framework of the United Nations, share the best practices and experience relating to geographical informa-tion administration regime/mechanism, law, regulation, technical standard and economic model, and jointly promote profound devel-

opment and extensive application of national, regional and global geographical information. Situated in Zhejiang Province, the project will cover a land area of 35,718 square me-ters and a total floor space of 48,540 square meters, and involve a total investment budget of RMB580 million.

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On May 28, Jinan Foundry & Metal Forming Machinery Research In-

stitute (JFMMRI) and China Machinery Engineering Corporation (CMEC) held a meeting on implementing the cooperation project involving riser hammer in Jinan City. Successful research of the riser hammer is the first result from internal cooperation under the export multiplication project of SINOMACH and makes a good beginning for SINOMACH to go global and rebuild a new SINOMACH overseas.

The 22nd FIFA World Cup will take place in Qatar in 2022. SUMEC Group

Corporation (SUMEC) has stood out of many rivals with the Firman diesel generat-ing set taking pride in unique design for the desert climate, delicate workmanship and meticulous service, and successfully become a partner to the event in urgent power supply equipment.

Qatar has a tropical desert climate with high temperature, dryness, temperature difference of up to 55℃ and sandstorm. The organizing committee has set rigorous performance requirements for the diesel generating set as

First Result of Internal Cooperation under “Export Multiplication” Project of SINOMACH Riser Hammer Creates the First in China

Abstract: With a special energy storage structure, the product quickly releases

the compressed air, which serves as the power, so that the working hammer will

get a huge impact energy instantly to remove casting risers of large castings with

high efficiency, thereby reducing slashing repair welding and scraps created by

improper removal of risers. The penetration of the project will play a positive role

in enhancing the competitive strengths of Chinese casting products.

The riser hammer is mainly used to remove casting risers of large castings. In the cast-ing industry, it is always a big headache to remove casting risers, particularly large castings. The traditional gas cutting method causes the oxidation and waste of materi-als in large quantity and also does harm to castings. In particular, it will destroy the metallographic structure of high manganese steel, which will incur cracks. The artificial hammering method only applies to small casting risers. Besides, it involves very low

efficiency and very high working intensity of workers.

In 2013, JFMMRI and CMEC started work-ing together to develop a riser hammer prod-uct that took the lead internationally and was the first domestically to solve the problem of riser removal and carry out the export mul-tiplication strategy. After one-year research and pilot, the product has passed the pilot and attracted great attention from the industry af-ter the exhibition at Shanghai Foundry Expo.

BHI Boosts 2022 Winter Olympic Games with High-speed Cable Car Project of Wanlong Ski Resort

SUMEC Firman Generating Set Boosts 2022 FIFA World Cup Qatar

Beijing Hoisting and Transportation M achinery Research Institute (BHI) has

recently signed the contract on construction-of the High-speed Cable Car Project with Zhangjiakou Wanlong Ski Resort, a venue of the Winter Olympic Games, to contribute its force to the successful hosting of the event. The project reflects the technical level of the institution in the cableway business, and has also created several records for the con-tractssigned bytheinstitution.Ithasthelargest single contract value, the largest number of

the urgent power source to ensure normal functioning of the power supply system for the news broadcast system, assure stable and efficient power output under the local bad cli-mate condition and meet the requirement for uninterrupted power supply with high load.

Considering the climate characteristics and high stability requirement of Qatar, SUMEC has used the FAD air channel optimization system developed in-house for the generator case, upgrading the anti-sandstorm capacity of the case, stability of power output and other indicators to a big extent and making a further breakthrough in the industrial tech-

nology and performance while inheriting the comprehensive advantages of the generating set like low oil consumption, low emission, low noise and simple repair. At the same time, upholding the “small product and big service” concept, SUMEC will deliver a package service covering product planning, equipment manufacturing, site installation and commissioning, personnel training and 24-hour response in a move tobuild a premi-um project and deliver thebest user experi-ence during the entire project.

Profile: Wanlong Ski Resort is one of the most famous ski resorts in North China and also an important

infrastructure reserve with which China has bidden for the 2022 Winter Olympic Games. Since 2009, BHI

has won the trust and favor from customers with reasonable price, excellent product quality and good

after-sales service. The project has made a good beginning for BHI in Zhangjiakou and consolidated the

local market.

cable A will have a horizontal length of 1,845m, an elevate ion difference of 502m between the upper stop and the lower stop , and a maximum capacity of 2,400 people/hour; cable C will have a horizontal length of 2,330m, an elevation difference of 531m between the upper stop and the lower stop, and a maximum capacity of 2,000 people/hour; and cable I will have a horizontal length of 1,170m, an elevation difference of 220m between the upper stop and the low-er stop, and a maximum capacity of 2,400 people/hour. The maximum working speed of the cableways will reach 6m/s, which has broken the maximum speed of 5m/s for the same product under the earlier contracts. Thus, the detachable cableway equipment produced by BHI will be totally the same as foreign products in all parameters.

cableways under a single contract and the fastest operating speed of the cableways.As a result, it fulfilled 83% of the full-year op-erating task for the cableway business in the first quarter of 2015.

The project involves a contract value of RMB 78.60 million, and includes the work to build three detachable grips and 8-pas-senger cabin-typeskiing cableways, namely cableways A, C and I of the high-speed cable cars of Wanlong Ski Resort. In detail,

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On June 26, Changlin Co., Ltd., a sub-sidiary of SINOMACH-HI, exported

another 15 mining trucks to Tajikistan, another big order after a large export of

In July, 2015, after fierce struggle, the CMEC Export Control Office has won the

internal control and compliance team award for export control in the other regions of the world granted by the World ECR. It is worth mentioning that CMEC is the first Chinese company that has been nominated and finally awarded.

The World ECR (The Journal Of Export Controls And Sanctions) is an international magazine generally recognized by the in-

On June 9, the World Accreditation Day, Vkan Certification &Testing Co., Ltd.

(Vkan) under China National Electric Appa-ratus Research Institute (CEI) signed a mem-orandum of cooperation with Korea Testing & Research Institute (KTR) in Guangzhou.

According to the agreement, both parties will exert respective resource advantages, launch cooperative research on electronics, electrics,

On July 16, two 55t and 25t cranes of the G series slowly drove out of Sichuan

Changjiang Engineering Crane Co., Ltd. (Changjiang Crane), and were then shipped to Thailand. Different from the black-white body of traditional cranes of Changjiang Crane, the two cranes exported are amicably called “Red Face Beauty” due to the orange color blocks on both sides of the body. This is an “auspicious” coating Changjiang Crane has specially used upon the request of the Thai customer.

To further increase the export sales share, Changjiang Crane has delivered the “menu” service based on special requirements of for-eign customers: the customer “orders a dish”, and the plant makes the customary product. This year, Changjiang Crane has delivered the R series with the right driving cabin and the K series equipped with Cummins engine

Seizing Opportunity from “The Belt and Road Initiative”, SINOMACH-HI Strives to Develop Overseas Market

CMEC Wins the Best Export Internal Control & Compliance Team Award Granted by World ECR

Vkan Joins Hands with KTR to Promote China-Korean Trade Development

SINOMACH-HI “Customary” Cranes Welcomed

heavy-duty grabs and bulldozers to the coun-try last month.

On the same day, SINOMACH-HI (Luoyang) Co., Ltd. smoothly shipped the T120N-3 trailer bulldozers tailor-made for foreign customers, which are the second customary products delivered to the same customer af-ter the shipment of the T100G-3 trailer bull-dozers in mid-June. Successful development of the new T120N-3 bulldozer will open up a new market universe for shoveling transport machinery of SINOMACH-HI (Luoyang)

Co., Ltd. and further enhance the technical competitive strengths of its products.

In response to the continuous downturn of the domestic construction machinery market, the production members of SINOMACH-HI have seized the opportunity created by “The Belt and Road Initiative” and strived to develop the overseas market. They have focused on the countries along the “Belt and Road” and made a good record.

to foreign customers, while changing the ex-terior coating is only one of the “private cus-tomary” services Changjiang Crane renders based on diversified demands of customers.

Customary product is no longer fresh in the construction machinery area. SINOMACH-HI (Luoyang) Co., Ltd. has also offered

customary services to users from different regions. Such customary service has won the favor from more and more foreign users and effectively stimulated the product export. The aforesaid Thai customer has put new orders several times to Changjiang Crane.

ternational export control circle. It is called the Forbes with big influence in the global export control area. With rigorous recom-mendation and assessment procedure, the World ECR rates experts and working teams that perform well in the internal control and compliance relating to export control.

GE has won the award in the Americas Re-gion and Air Bus Group has won the award for the European Region.

part and other relevant business areas and deliver convenient, quick local product cer-tification and testing services to Chinese and Korean trading enterprises to jointly promote rapid development of the China-Korea trade.

After China and the Republic of Korea signed the free trade pact, the bilateral trade will leap forward and benefit many enter-prises in both countries. Stimulated by the policy, Vkan and KTR will cooperate in the certification and testing area and deliver con-venient certification and testing services to trading enterprises of both countries, which will greatly promote the bilateral trade in electronic and electric products.

Profile: Founded in 1969, KTR is a legal entity under the Ministry of Trade,

Industry and Energy (MOTIE) and a National Certification Body (NCB) of the

IECEE-CB system of the Republic of Korea.

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TRADE AND SERVICESFOCUS POINTS PROJECT PROGRESS TRADE AND SERVICES SINOMACH OVERSEAS SINOMACH SUBSIDIARY

Driving Dream and Conveying Hope in Africa: 2015 SUMEC Firman Children Care Plan

Recently, the SUMEC Nigerian sales team and the local dealer jointly visited

two orphanages Compassionate Orphanage and Citadel of Grace Mission in Lagos Re-gion. They met children there and brought them with life necessities like foods, water, nutritious foods, toys, books and generators.

On the day, the children waited before the gates early and sang warm songs, waiting for the arrival of their Chinese friends. The directors detailed the histories of the orphan-ages as well as the learning, life and health of the children, said SUMEC was the first Chi-nese enterprise that has visited their orphans, and hoped more enterprises would watch the living status of organs in Nigeria. After completing small wish trees, the children also performed the songs they had rehearsed to express their acknowledgment to the Chi-nese friends, and the pure and simple songs moved everybody present.

Hit by a number of adverse factors like glob-al economic downturn, oil price plunge and government reelection, Nigeria has suffered

mented the marketing and service strategy of “moving close to terminals and flying with two wings” to better promote products and services to end users. As an offline channel, it has built flagship stores integrating sales, exhibition, promotion, after-sales service and maintenance functions in Lagos, Port Harcourt, Uyo and other major city to re-inforce local service. As an online channel, it has joined hands with Konga, known as “Taobao” in Nigeria, and Jumia, known as “Amazon in Africa”, to open authorized direct marketing stores and interact with us-ers around the clock. At the same time, as a leading power generation equipment brand in the Nigerian market, SUMEC has organized several engineers’ conferences to cultivate local professionals with great effort. It has

paid continuous attention to the living status of local orphans and implemented the Chil-dren Care plan to help more Nigerian chil-dren grow healthily with what it can do. The charity events this year have triggered a good response from local partners, and they say they are willing to participate in every event in future.

“Integrate global resources, share human civ-ilization”. SUMEC Firman will walk shoul-der to shoulder with local partners to drive dreams and convey hopes in Africa.

25 years ago, SUMEC Firman, the generator

brand under the SUMEC, entered Nigeria, an

African country honored as “African Eagle”.

Benefiting from rapid development of the

local economy, SUMEC Firman has grown

into the number one power generation

equipment in the African country.

a currency devaluation, a fiscal deficit and America’s exit of the QE policy, and made a series of policies to increase the tax, which has delivered a major impact on the market and people’s life. SUMEC Firman has imple-

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CAMCE Belarus 400,000t Pulp Project Donates Medical Equipment

CAMEC Myanmar Representative Office Actively Participates in Flood Aid Action in Myanmar

On June 5, the donation ceremony of the CAMCE Belarus 400,000t Pulp Project for Medical Equipment was smoothly held. On behalf of CAMEC, the project department

donated a package of medical equipment to the Central Hospital in Svietlahоrsk.

of the 400,000t Pulp Plant Project acknowledged CAMEC for the donation on behalf of the local government, the hospital and the owner. With the donation,CAMEC has shaped its cor-porateimage and improved thereputationin Belarus.

On August 7, under the uniform leadership of the Chinese embassy in Myanmar, the

disaster relief mission of Chinese enterprises in Myanmar fought the way to two cities that were most affected by the flood in Magway Division, and donated the materials they raised to the victims. They were warmly welcomed by the people in the disaster areas. The mission was composed of Lv Dexing, President of Chi-nese Enterprises Chamber in Myanmar, Vice President Wu Mingyuan (Chief Representative of CAMEC Myanmar Representative Office), Vice President Lv Xiaoqun and some member enterprises.

At the material preparation stage, the CAMEC Myanmar Representative Office actively answered the call of the Chinese embassy, the Commercial Councilor’s Of-fice and the Chinese Enterprises Chamber in Myanmar, organized and coordinated the event in earnest, bought disaster relief goods worth more than MMK 58 million and donat

ed USD1,500 to the disaster areas.

Besides, the employees of the representative office spontaneously donated MMK 2 million worth of money and materials and delivered the same to the disaster areas through the local relief agency.

CAMEC’s participation in the flood relief in Myanmar reflects it bravely shoulders the cor-porate social responsibility and will furtherimprove itssocial image in thecountry.

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SINOMACH OVERSEASFOCUS POINTS PROJECT PROGRESS TRADE AND SERVICES SINOMACH OVERSEAS SINOMACH SUBSIDIARY

CMEC’s Distinctive Way of Transnational Operations

To be a world-class transnational corpo-ration and achieve the goal of “building

a new SINOMACH overseas”, CMEC must vigorously strengthen its transnational oper-ations based on its traditional strengths, and strive not only to achieve great expansion in the scale of operation, but also to realize the innovation of its business models and the up-grade of its operational functions.

Reviving the Trade Business

First, we must accelerate the transformation of business models from a largely trading intermediary type of business model to a new “one-stop” one that focuses on prob-lem-solving. This new model refers to the business processes in which profits come from the added value generated not only from intermediary trading but also from solutions offered to the problems of trading

partners at all stages of the whole industrial chain. CMEC Industrial and Trading Corpo-ration has made a good start in this respect in recent years, and we should accelerate the pace even more in the future.

Second, we must promote the collaboration between the trade business and project con-tracting, and derive new trade opportunities and forms of trade from the latter. It is worth discussing “package trading” and “portfolio trading” in combination with engineering contracting projects in the future. “Package trading” refers to using the lateral contacts of the corporation’s business sectors and over-seas institutions to uniformly and domesti-cally supply various commodities required for the project and combine them with Chi-nese products. The management platform that the corporation is building for central-ized procurement will lay a solid foundation for this form of trading.

CMEC Strategy and Operation Development Division

To further implement China’s “going global” strategy, in particular, to seize the strategic

opportunity of “One Belt and One Road”, Chairman Ren Hongbin put forward, at the 2015

SINOMACH Work Conference, the strategic concept of “building a new SINOMACH overseas” by

the year 2020. As SINOMACH’s “eldest son” and its first “going global” enterprise to participate

in international operations, CMEC, on one hand, was deeply inspired by the concept, and on

the other, felt a heavy responsibility.

SINOMACH SUBSIDIARY

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SINOMACH SUBSIDIARYFOCUS POINTS PROJECT PROGRESS TRADE AND SERVICES SINOMACH OVERSEAS SINOMACH SUBSIDIARY

Third, we must work hard to expand interna-tional trading to encompass multiple trans-actions. We should consider the whole world as a big market, seek the most favorable sup-plier of a commodity worldwide, and then make it a stronghold for a global range of business activities to promote trade, mutual credit transactions, global operations, and other diversified business activities among developing countries; and when trading with countries that have a foreign exchange shortage, we can barter, do mutual trade pur-chases, and share products. These are areas where CMEC can make full use of its unique advantages and should be explored with in-creased effort.

Fourth, we should actively employ the con-ditions that facilitate trade and investment of “One Belt and One Road”, base ourselves in the equipment manufacturing industry, accel-erate the transformation and upgrade of our trade business, and strive to achieve break-throughs in industrial investment around our core markets, core fields, and core products. We should especially pay attention to the

continue to build the corporation’s capabili-ties in design consulting for power projects through “non-organic ways” such as mergers and acquisitions, and strategic alliances and cooperation, and manage to improve the management level for design and construc-tion, so that our industrial chain can be per-fected and further enhanced.

— Continue to extend the industrial chain: mainly, to extend the two ends of the EPC industry chain. In the upstream chain, we should actively explore and push forward the investment-led EPC business model; in

the downstream, we should move toward the field of operation, promote the combination of construction and operations, establish a full life cycle concept for construction proj-ects, and set up our own operation team as soon as possible to start the business.

— Always be committed to detail innova-tions: details are the key to success. Unlike manufacturing enterprises that are innovative with hard technologies, CMEC is continu-ously innovative and makes breakthroughs with the details of its business models to keep its edge in operations. In the future, we should carry forward this tradition. In addi-tion to project development, we should also increase our investment in project imple-mentation for breakthroughs, such as bring-ing “Building Information Parameterization” and 3D design to design management to en-sure the quality of design and construction.

Accelerate Overseas Investments

In keeping with its strategy, CMEC has established a specialized investment and financing department, set up an investment team, initially established an investment sys-tem, and achieved breakthroughs in a num-ber of overseas investment projects, such as the Turkey OEDAS grid acquisition. Cur-rently, the corporation’s investment priority is in familiar areas and familiar markets. But we are breaking ground in new investment areas that include both greenfield invest-ments like franchise projects and brownfield projects, mergers, and acquisitions.

Next, the corporation will accelerate the pro-cess while recruiting talent and perfecting the systems. In the long run, if the timing is right, the corporation may also enter the field of overseas resources development and in-vestment because CMEC has the necessary experience and talent from its earlier iron ore project in Gabon. Investment in overseas resources is in line with the requirements of China’s “going global” and “One Belt and One Road” strategies, and it is conducive to the steady development of the corporation’s overseas business and can lead to the devel-opment of “bulk trade.”

Strengthening Overseas Financial Support

In 2014, CMEC made a breakthrough in low-cost overseas financing on the Canada Philip Student Apartment project. It was a good start and gave the corporation the confidence and experience to further expand its overseas financing channels. In the future, we will further strengthen the business cooperation with well-known international financial insti-tutions to establish extensive contacts, while taking advantage of the corporation’s Hong Kong listing and using international capital to develop overseas business and establish overseas financial subsidiaries at the right time and the right place. These subsidiaries can not only provide support for the corpo-ration’s overseas trade, project contracting, and investment business, but can also create new and unique sources of overseas revenue through steady development of diversified financial services.

Upgrading the Overseas Information and Intelligence Platform

Actually, CMEC’s overseas information and intelligence function already existed when the corporation started its overseas layout after it was first established. Over the years, as the corporation has spread all over the world, so have its information and intelli-gence sources. Although they have provided basic support for the corporation’s business development, the problems with them are obvious—these information and intelligenc-es are in the hands of individual business personnel, thus forming a “single-handed” type of business development model.

To strengthen overseas operations, we need information and intelligence not only about commodities, transportation and exchange

construction of overseas industrial parks, international cooperation in production ca-pacity and transnational e-business under the “One Belt and One Road” strategy, give full play to our advantages in trade and services, and work hard to achieve a difference.

Steadily Push Forward Project Contracting’s Transformation and Upgrade

CMEC was China’s first enterprise to engage in international project contracting. Since the early 1980s, this business of the corporation has developed in depth and breadth. Now it has become the corporation’s core business with certain competitive advantages and has been a domestic leader for quite a long time.

Currently, the transformation should be mainly focused on the following aspects:

— Continue to strengthen the industrial chain: mainly, to enrich it and reinforce its weak links. In addition to strengthening our own capacity building, we should also

We must accelerate the transformation of business models.

We must promote the collaboration between the trade business and project contracting.

We must work hard to expand international

trading to encompass multiple transactions.

Continue to strengthen the industrial chain

Continue to extend the industrial chain

Always be committed to detail innovations

We should actively employ the conditions that facilitate trade and investment of “One Belt and One Road”.

First

Fourth

Second Third

Reviving the Trade Business Steadily Push Forward Project Contracting’s Transformation and Upgrade

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FOCUS POINTS PROJECT PROGRESS TRADE AND SERVICES SINOMACH OVERSEAS SINOMACH SUBSIDIARY

rates, but also about politics, economics, so-ciety, culture, technologies, family life, and other information. The information and in-telligence capacity derived from the fast and high-quality information and intelligence “flow” does not just mean the capability to gather information and intelligence itself, but rather, it is a process of the analysis, processing, and classifying of information and intelligence to seek and seize business opportunities, to create business opportuni-

ties, and then finally to develop strategies. With the development of the information revolution, the traditional single-handed way of handling information and intelligence is outdated for integrating the information as needed. Therefore, we should consider building a global information and commu-nication system and other knowledge plat-forms, gathering and integrating intelligence and information, especially that gained from the global business network, including

that obtained through human relationships, which cannot be replaced by computers and other automated information systems, for the entire corporation to use so that it can guide a combat group. In the long term, the day will come when industrial development is based on information and intelligence and the intelligence and information are indus-trialized. Therefore, we must make the time to accelerate the establishment of our global information and communication systems.

For CMEC’s distinctive way of transnational operations, we need to do the following four tasks in the future: first, we need to make an overall plan and formulate strategies for the development of overseas business; second, we need to adjust, integrate, and reorganize our existing overseas institutions, including repositioning some functions, to continue to promote regionalization and localization; third, we need to strengthen the management of overseas institutions and focus on risk

prevention and control; and fourth, we need, now, more than any time before, to strength-en the cultivation of talent for international operations.

On December 21, 2012, CMEC’s H shares were listed in Hong Kong, creating a suc-cess of 56 times over-subscription in Hong Kong’s capital market, and became the sub-scription king of the 2012 Hong Kong stock market. After more than two years of opera-

tion, CMEC has gradually formed the gov-ernance structure that is fit for transnational operations. Through continuously strength-ening CMEC’s transnational operations, employees of the corporation have both confidence and determination to become the mainstay for “building a new SINOMACH overseas” and develop CMEC to become a world-class transnational corporation.

Continue Going Forward to Become a World-class Transnational Corporation

VOL.33NO.3 Sep, 2015

no.3 sep, 2015...no access to power. the domestic wind turbine installed capacity of 2,036 mw is...

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