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US-China trade could get Belt-Road lift

By Paul Welitzkin in New York | China Daily USA | Updated: 2017-05-16 10:34

China-led Belt and Road Initiative (BRI) project not only has the potential to create a network of railways, roads, pipelines and utility grids linking Asia with Europe and Africa, it also could provide a boost to Sino-American trade, according to Xu Chen, president of the Bank of China USA and chairman of the China General Chamber of Commerce-USA.

"The Chinese government and the central bank (People's Bank of China) would welcome the involvement of American financial institutions in BRI,"Xu said in an interview Monday as the two-day Belt and Road Forum for International Cooperation ended in Beijing.

The BRI, which stands for the Silk Road Economic Belt and the 21st Century Maritime Silk Road, was proposed by President Xi Jinping in 2013 to boost interconnectivity and free trade between Asia and the rest of the world.

Xu said that the BRI will create a new market not only for Asia and China but also for Western economies like the US.

In addition to generating infrastructure investment, the BRI aims to develop a global platform for economic cooperation, including policy coordination, trade and financing collaboration, and cultural cooperation.

Xu said that the Bank of China plans to be an active participant in BRI financing.

"The Bank of China Group will provide adequate support for BRI,"Xu said.

He said that his and other Chinese banks' balance sheets can handle the initiative's financing requirements.

"We have made an effective cost-benefit analysis to provide loans based on the cash flow of the borrower,"he said.

"We may need to issue bonds, and American credit-rating agencies and American banks can become involved in this process."

After the release of 10-part deal between China and the US last week, it may be easier for American companies to get in on the action. The deal, the first tangible result of trade talks between the world's two largest economies that began last month, will see increased access for American financial companies, including electronic payment and bond underwriting firms.

Many US companies like Caterpillar and General Electric also would like to take an active role in the BRI.

"The Bank of China would very much like to work with American companies (like Caterpillar and General Electric) in BRI,"said Xu.

Another part of last week's trade agreement will see China allow US imports of beef, and in return, the US said it would issue a proposed rule to allow Chinese cooked poultry to enter its markets.

Xu said agriculture holds a tremendous amount of potential for increasing trade ties between China and the US.

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