Wei Jianguo: Balkan Peninsula is A Good Entry Point for Energy Cooperation Along the Belt and Road

On March 30^th, 2018, the “Belt and Road: Balkan Energy Investment Summit” was jointly hosted by Accenture and the “Energy” magazine in Beijing. Wei Jianguo, Vice Chairman of the China Center for International Economic Exchanges (CCIEE) and former Vice Minister of Commerce delivered a speech, explaining why it is now the best time for Chinese energy companies to enter the Balkan Peninsula market with three short stories.

Below are some of Wei Jianguo’s quotations:

“I have visited 218 countries and according to my understanding, all the countries need China’s energy the most.”

“How can China’s energy companies enter the Balkans? What are the key issues and weaknesses? I think that the capital is the most important thing.

“What is the biggest problem that we are likely to encounter next in addition to funds?” “It is the grid, how can we deliver electricity via the smart grid.”

“In the next five to ten years, China will make great contributions to the energy development, economic development of the Balkan Peninsula.”

The following is the speech delivered by Wei Jianguo at the summit.

Good morning! At present, I serve as the Vice Chairman of CCIEE. Today, I would like to explain why it is now the best time for China’s energy companies to enter the Balkan Peninsula. Let me first tell you three short stories.

It was my pleasure to participated in the “Belt and Road Forum for International Cooperation”, held in Beijing last May. A sub-forum with the theme of Cooperation Among Think Tanks was organized by CCIEE, and Kevin Rudd was a VIP speaker. Almost 1,500 people stood up and applauded when heads of state of the developing countries such as Xi Jinping, Erdogan and Putin enter the venue. Many ministers from the developing countries were sitting next to me and they were very excited. I asked them during the coffee break, what do you need the most from the Belt and Road? To my surprise, they said energy.

I accompanied Chinese leaders to 218 countries and participated in many high-level talks, according to what I have heard, Chinese energy is the thing many countries need the most. On the evening banquet of the “Belt and Road” forum hosted by President Xi, I sat next to Kevin Rudd, former Prime Minister of Australia, the Prime Minister of Pakistan, and the well-known Italian Prime Minister Loma and other prime ministers.

Speaking of China, Kevin Rudd said that China’s energy has experienced unprecedented development, and it will play a significant role in the coming decades as many countries lack energy. I asked him what kind of energy is that? He laughed and told me that it was the nuclear power. Thus in one of the papers I wrote before, I mentioned that China’s nuclear power is now going to enter 63 countries, 93 ports and cities along the Belt and Road route. This is my first short story.

The second story tells us how can China’s energy companies enter the Balkans? What are the most critical issues and weaknesses in this aspect? Someone told me that we do not understand the Balkans but this is wrong. When I was the Vice Minister of Foreign Trade 25 years ago, I was responsible for all Chinese assistance to developing countries and we built the first power station in Macedonia, we were the first to enter the Balkan Peninsula as a private enterprise.

Most of the companies at today’s meeting are private and central enterprises. We are planning to strengthen the “16+1” but the EU always accuse us of splitting the EU. No, we are further strengthening the EU. We are not splitting the EU but to further enhance it. One of my past papers is to let the EU know that they should avoid misjudgment.

What else? We do not have personnel or equipment? No! In fact, we have a large number of good Chinese hydropower and energy companies. I think what we really need is capital. I asked the Chairman of Accenture Zhu Wei, how can we enter the energy market in the Balkan Peninsula? He replied that we have to design a plan to bundle funds and projects together.

As we all know, CCIEE has participated in the preparations for many funds, including the AIIB, the Silk Road Fund, the China Singapore Eco-City, Hainan Tourism Island, the great bay area of Guangdong Hong Kong and Macao. Next we will research the highest opening model in China: the free trade port.

Why did we set up the AIIB and Silk Road Funds for the Belt and Road?  In the next ten years, the infrastructure alone in Southeast Asia will need $8 trillion investment, which means that we need $800 each year. The Japan-led Asian Investment Bank, the Asian Development Bank, the IMF, and the World Bank can only raise 25 billion Yuan each year, which can hardly satisfy the financial needs of the infrastructure investment along the Belt and Road region. Even if we add the AIIB and the Silk Road Fund, we can only get 2,000 to 250 billion RMB each year. As can be seen, we need more investment from social capital and international banks, so funding is the biggest challenge for the Balkan peninsula.

I am very pleased to see that we will join hands with the Silk Road Fund, the AIIB and more international organizations to enter the Balkans energy market.

The third story is a question I posed to the former Chairman of the State Grid Corporation of China, Liu Zhenya, who is now Chairman of the Global Energy Internet Development Cooperation Organization. I asked that apart from funding, what is the biggest difficulty we will encounter? He said it would be power grid, specifically speaking, how to use the smart power grid to deliver electricity? Therefore, we must not only have good power generation facilities and power plants, but also smart grids which can be used to solve problems.

I hope that these three stories reveal how can China’s electric power companies enter the Balkans market. If we can consider these three issues when making a master plan, China will make enormous contributions to the Balkan energy market and its economic development in the next five to ten years.

Thank you all!