China’s “One Belt, One Road” strategy: the role of multinational corporations
Dec 7, 2016
Speech given by Simon Henry, Chief Financial Officer at the 9th International Roundtable of Multinational Corporations Leaders in Beijing, China, on December 7, 2016.
China’s “One Belt, One Road” strategy is impressive in both the timescale of its vision and in that vision’s geographical breadth. In this speech, Simon Henry explores the areas where multinational corporations can contribute to the success of China, to the benefit of all.
Vice Chairman Zheng Wantong, distinguished guests, ladies and gentlemen.
Thank you. It is truly an honour to be with you again, and also a great honour to stand before you as a Vice President of the China International Council for the Promotion of Multinational Corporations.
It feels right to be talking about the “One Belt, One Road” initiative at this ninth roundtable meeting. After all, the Chinese association between the number “nine” and the concept of all things long-lasting does feel specially significant today.
I think of all the long-lasting relationships this gathering has encouraged, the long-lasting success our cooperation has enabled and – particularly when we consider “One Belt, One Road” – the importance of long-lasting vision.
Sharing China’s long-term vision is the first of three things that multinationals can contribute to “One Belt, One Road”. Multinationals can also offer the benefits of their international scope of operations. And their third potential contribution comes hand-in-hand with having long-term vision: partnerships and collaboration. Please let me say a little about each of these three things, starting with long-term vision.
China knows all about the link between long-term vision and collaboration. This has been clear in the important thought and work China has done over the energy transition. It was obvious in the global leadership President Xi gave at the climate talks in Paris last year.
Perhaps it is China’s history of many thousands of years, as old as the history of mankind itself, that allows it to look so far into the future.
Shell, too, likes to look towards the future. The company makes investments with a 40-year lifespan. It seeks to be present in, and to benefit, communities for generations. It does scenario planning that casts forward to the end of the century.
Perhaps, Shell’s natural tendency to look towards the long-term helps to explain the deep partnerships the company has been able to establish in China over the years.
If “One Belt, One Road” is impressive in the length of its vision, it is just as impressive in the geographical breadth of its vision. That is the second area where multinationals can contribute.
Shell, for example, operates in over 70 countries. Across Asia, the Middle East and into Europe, there are very few countries Shell does not have a presence in. Those operations, those relationships, in all those countries can open doors can make connections and can help make projects happen.
The third area I want to talk about is the spirit of collaboration. Without that, I doubt whether any company would ever have become a multinational in the first place.
Shell is used to collaborating across borders, industries and cultures.
And there is no better example of Shell’s collaboration in China than the relationships we have with CNPC and with CNOOC. Our equal parties and old friends.
It is significant that, in a tough year for oil and gas, we have made only two final investment decisions and one of those was in China. This was the decision to expand the CSPC petrochemicals facility, a joint venture with CNOOC.
Shell is also very proud of its work with the State Council of China’s Development Research Centre, which has now entered its third phase. It is a great privilege for Shell to have been invited to cooperate with the DRC to look in depth at the Chinese energy landscape.
And Shell is always finding fresh collaborations in China, new relationships with Chinese partners looking to invest overseas. Each time I visit this country I come away with new ideas, new connections and new friends.
So there you have three things. Three things that Shell, as a multinational, can bring to “One Belt, One Road” to ensure its success. Long-term vision. An established international business network. And the spirit of collaboration and partnership.
Together, we can achieve great things. May the work of this ninth roundtable meeting be long-lasting, and to the benefit of all.