Gas engine or due to APCE welcome development opportunities
In the annual diplomatic flourishing period, China may promulgate some important agreements with relevant countries and bring benefits to the automotive industry, especially the development of gas engines.
As the most influential economic cooperation conference in the Asia-Pacific region, APEC is held in rotation among 21 member countries each year. In 2014, APEC returned to China after 13 years. It will hold a series of meetings including the leaders' informal meeting, ministerial meeting and senior official meeting in Beijing recently.
In this annual diplomatic boom, China may promulgate or enter into important agreements with relevant countries to bring benefits to Chinese companies including auto industry companies. So what are the policies that may bring benefits so far?
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APCE Official Official Car Part Loaded Yuchai YC4G State 5 Gas Engine
Gas engines or major development opportunities
When meeting with Russian President Vladimir Putin on the 9th, President Xi Jinping signed a series of bilateral cooperation agreements, including the Memorandum on Cooperation in Supplying Natural Gas from the Russian Federation to the People’s Republic of China through the Sino-Russian Western Line, and “China Petroleum Natural Gas Group and Gazprom's Framework Agreement on Supply of Natural Gas from Russia to China via the Western Line between China and Russia. At this point, China and Russia once again signed a large energy bill and the West Line natural gas pipeline landed.
In an agreement reached between China National Petroleum Corporation and Gazprom, the Russian side will supply an additional 30 billion cubic meters of natural gas each year from Siberia to China through the Altai pipeline for a period of 30 years. Gazprom CEO Alexey Miller said that according to part of the agreement with CNPC, Russia may begin to supply natural gas to China within 4 to 6 years.
Prior to this, China and Russia signed a $400 billion agreement in May. Gazprom supplies 38 billion cubic meters of East Siberian gas to China each year. The number of 30 billion cubic meters in this agreement is less than the previous time, and the specific price is not yet clear.
The two agreements signed in succession accounted for 17% of China's consumption before 2020, said Gordon Kwan, head of energy research for Nomura Securities Hong Kong.
According to the CNPC website, when the new signed natural gas agreement begins operations, China will surpass Germany as Russia’s largest natural gas customer.
Adequate air supply will at least ensure steady development of the gas engine.
Is the "One Belt and One Road" hot stir the China Marshall Plan?
At the opening ceremony of the Asia-Pacific Economic Cooperation (APEC) business leaders that opened in Beijing, China’s foreign investment in the next 10 years will reach US$1.25 trillion.
Xi Jinping also announced that China will invest US$40 billion to establish the "Silk Road Fund," which is intended to invest in infrastructure and support his vision of "One Belt, One Road" (China's Silk Road Economic Belt) connecting China and the Mediterranean. "21st Century Maritime Silk Road").
China is likely to become a net exporter of capital for the first time this year. The Chinese government has reduced restrictions on overseas investment and encouraged companies to seek overseas M&A transactions.
The 1.25 trillion U.S. dollars of overseas capital flow predicted by Xi Jinping means that China’s foreign direct investment will increase nearly threefold in the next 10 years.
He said that the Silk Road Fund will be open to other countries and investors, and provide investment and financing support for related infrastructure projects such as infrastructure construction, resource development, and industrial cooperation along the “One Belt and One Road†initiative.
Both research institutions and the media use the Chinese version of the Marshall Plan to describe China's major plans for external infrastructure investment: The Asian Infrastructure Investment Bank is an important implementation guarantee for the Chinese version of the Marshall Plan, and the “Belt and Road†strategy is the strategic carrier of China’s capital export program. The output digests its own excess production capacity and drives global growth by stimulating infrastructure construction in emerging market countries and underdeveloped countries.
Can the auto industry seize these opportunities? Are these policy measures capable of landing? Can only wait to see.
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