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在线翻译:
szdaily -> Opinion -> 
Less haste, more speed
    2014-11-24  08:53    Shenzhen Daily

    Wu Guangqiang

    jw368@163.com

    WHAT is it like to fall from heaven to hell within a few days? China Railway Construction Corp. (CRCC) learned this the hard way.

    On Nov. 3, when Mexico announced that CRCC and four Mexican partners had won a US$3.75 billion contract to build a 210-km high-speed rail in Mexico, millions of Chinese were elated, calling it “a milestone” in China’s high-speed rail’s overseas expansion efforts. Over the years, China’s top leaders and industry CEOs have been gung-ho about promoting China’s cutting-edge high-speed rail projects around the world.

    Yet on Nov. 6, Mexico abruptly withdrew the deal because of “concerns about the bidding process.”

    The farcical cancellation stunned China. The Mexican authorities have decided to start the bidding over with more time allotted to encourage more train-makers to make proposals.

    The Chinese firm has said that it is mulling legal action to safeguard its rights. Experts believe that the Chinese firm has not been struck out of the contest, and that with its advantages in technology, price and service, CRCC stands a good chance to nab the contract again.

    However, more cautious voices are alerting Chinese companies about the high risks of getting involved in large-scale development projects overseas, including high-speed rail. China has learned some painful lessons because of rash overseas investments.

    On Feb. 10, 2009, CRCC inked a US$1.77 billion contract with Saudi Arabia to build a light railway line specifically for pilgrims traveling to Mecca, the holiest city for followers of Islam. But according to a CRCC statement in January 2011, the project had suffered a net loss of 4.15 billion yuan (US$66,978 million) by the end of October 2010, citing reasons such as underestimating the actual quantity of work involved and the proprietor’s delay in acquiring land and completing related infrastructure. The bottom line was that CRCC underestimated its risks.

    The Myitsone Dam in Myanmar was another lesson. The large dam and hydroelectric power development project on the Irrawaddy River, jointly built by Burmese government contractors (Asia World) and China Power Investment Corp. (CPI), was controversial from the beginning due to the project’s impact on local culture and the environment. On Sept. 30, 2011, Myanmar President Thein Sein announced that the project was to be suspended during his tenure.

    The Letpadaungtaung Copper Mine Project in Myanmar has experienced similar troubles. The US$1.65 Sino-Myanmar Project has been halted twice because of local inhabitants’ strong opposition to the project because of environmental and economic issues.

    As most potential clients for Chinese projects are from developing countries and regions, areas that lack rule of law, have rampant corruption, fickle policies, unstable governments and other complex cultural and religious factors, the risks are high. Some of them may be too costly for any enterprise to bear.

    Therefore, there should be government policies and comprehensive legal and executive measures in place to back Chinese projects’ overseas expansions, which, as a national strategy, would require national efforts for success.

    Before any contract is signed for a major building project, a memorandum of understanding should be reached between China and the nation/region where the project is to be constructed to ensure the relevant government’s commitment to the oversight of the full implementation of the contract and to take responsibility for all consequences in the event of a breach of contract.

    The Chinese Government should formulate guidelines for Chinese companies on must-dos before, in the middle of, and after they sign a contract overseas.

    Risk-control must always be a top priority. Chinese companies must always stick to principles of openness, transparency and abide by the law, and they should never resort to illegal means for profits. Only by winning through fair competition, excellent quality and superior service, can China’s high-speed rail companies and other construction firms help build up the rest of the world.

    Amid China’s massive overseas investment strategy, patience and caution should trump haste and impulse.

    (The author is an English tutor and freelance writer.)

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