Infrastructure offers Chinese companies opportunities worldwide

Companies involved in infrastructure projects are set to explore more markets and increase exports to Europe in the coming years, with strong support from the Chinese government.

The government has repeatedly mentioned the need and desire to facilitate Chinese companies as they explore overseas markets and join the international competition for business.

The latest sign of support came from the State Council (cabinet) on Jan 28. It announced measures to support overseas direct investment in the rail, nuclear and other infrastructure industries.

The measures call for the exploration of international markets for heavy equipment, with an emphasis on various forms of cooperation such as joint ventures and hybrid ownership. The Council also urged companies to offer services such as engineering consultancy, construction, equipment supply and operational maintenance.

And it announced that the government supports exports of steel, non-ferrous metals, construction materials and textiles. It backs exports of communications, electricity, engineering and shipping equipment through overseas project contracting, overseas investment and acquisitions.

There were four key factors behind the announcement.

First and most important is that China now has the advanced technology and equipment for highways, nuclear plants and other facilities after more than 20 years of work in the domestic market.

So now it is appropriate for companies to tap into international markets such as Russia, Brazil and Thailand.

Developed markets are also being targeted. China Northern Locomotive and Rolling Stock Industry Group Corp announced a subway export contract with the United States on Jan 26. It is China's first foray into the US rail transit market. CNR will sell 284 subway trains worth $670 million for Boston's Red and Orange subway lines.