16 Sep Brunei companies ink five key agreements with Chinese firms
September 16, 2017
BRUNEI firms signed five significant economic and bilateral agreements with Chinese companies on the sidelines of the 14th China-Asean Expo (CAEXPO) yesterday, that will bring billions of dollars worth of investments into the country, further boosting the Sultanate’s economic diversification efforts.
The signing ceremony took place at the opulent Liyuan resort in Nanning, Guangxi, People’s Republic of China and was witnessed by Pehin Datu Singamanteri Colonel (Rtd) Dato Seri Setia (Dr) Awang Haji Mohammad Yasmin bin Haji Umar, Minister of Energy and Industry at the Prime Minister’s Office as the guest of honour.
These agreements were signed following the successful State Visit of His Majesty Sultan Haji Hassanal Bolkiah Mu’izzaddin Waddaulah ibni Al-Marhum Sultan Haji Omar ‘Ali Saifuddien Sa’adul Khairi Waddien, Sultan and Yang Di-Pertuan of Brunei Darussalam to China and the bilateral meeting with Xi Jinping, President of the People’s Republic of China on September 13.
The five agreements signed yesterday are expected to further strengthen the bilateral cooperation between the two countries for the mutual benefit of their peoples, including in the areas of economic cooperation and connectivity.
The agreement involving Guangxi Beibu Gulf and Hengyi Industries Sdn Bhd highlights the significant progress that has been made by the Government of His Majesty.
The establishment of the joint venture, the Muara Port Company with Guangxi Beibu further emphasises the government’s determination to improve the ease of doing business in the Sultanate as the joint venture has already improved the productivity of the Muara Port in terms of time and costs since it started operations in February 2017.
Darussalam Assets Sdn Bhd (DA) signed two collaboration agreements with Beibu Gulf Holding Co, Ltd (Beibu) – a contribution agreement and a Memorandum of Understanding (MoU).
The Contribution Agreement marks a new milestone with the securement of capital investments from Beibu, allowing for further upgrading of port facilities and equipment, with the primary objective of improving the efficiency and level of services provided by the Muara Container Terminal.
The MoU will result in the construction of a Logistics Park to be located at a site in close proximity to the Muara Port. The creation of this industrial park is expected to enhance the level of services provided at the port which will enable Brunei Darussalam to attract further foreign investments.
Witnessing the signing together with Pehin Datu Singamanteri Colonel (Rtd) Dato Seri Setia (Dr) Awang Haji Mohammad Yasmin was Chen Wu, Governor of the Guangxi Zhuang Autonomous Region and Zhang Xiaoqin, Vice-Governor of the Guangxi Zhuang Autonomous Region.
Signing on behalf of Darussalam Assets was Dato Seri Paduka Dr Awang Haji Mohd Amin Liew bin Abdullah, Deputy Minister of Finance and Chief Executive Officer of Darussalam Assets, while Beibu was represented by Zhou Xiaoxi, Chairman of Guangxi Beibu Gulf International Port Group Ltd.
Beibu also signed a letter of collaboration with DARe (Darussalam Enterprise) to explore industrial park infrastructure opportunities.
This will allow DARe to explore opportunities and leverage on Beibu’s existing experience in the ‘Port Industry-industrial Park’ development model and logistic network internationally to further develop Serasa and Pulau Muara Besar (PMB) industrial parks located within the vicinity of Muara Port. This will enhance Brunei’s attractiveness towards export-oriented foreign direct investments and create positive spin-offs benefiting local MSMEs.
The letter of collaboration was signed by Chairman of Guangxi Beibu Gulf International Port Group Co Ltd, Zhou Xiaoxi and the Chief Executive Officer of DARe, Javed Ahmad.
Meanwhile, the signing of the MoU between Hengyi Industries Sdn Bhd and the Government of Brunei Darussalam will allow for the 2nd phase development of Hengyi (Brunei) PMB Petrochemical Project at Pulau Muara Besar.
The second phase will be designed with new increased crude refining capacity as well as new increased production capacity of paraxylene and ethylene (1.5 million tonnes per year).
Following Hengyi’s investment for first phase, which amounts to US$3.445 billion with projected direct job employment opportunities of 971, it is estimated that the investment from Hengyi for the second phase is about US$12 billion and will provide an additional 1,500 direct job opportunities, 70 per cent of which will be for locals.
Signing on behalf of Hengyi Industries Sdn Bhd was its Chairman Qui Jianlin, while the Government of Brunei Darussalam was represented by Dato Seri Paduka Dr Awang Haji Mohd Amin Liew.
In an interview after the signing, Qui Jianlin indicated that other than creating direct employment opportunities, it will help create three to four thousands additional job opportunities for locals as a result of spin-offs in the services, financing and logistic sectors.
He said Hengyi hoped to complete Phase 1 in early 2019 and Phase 2 in 2022.
He also said that other than meeting the domestic requirements, Hengyi plans to export petrochemical products to surrounding countries and the chemical products to China to serve China’s domestic downstream industries as China is currently the world’s biggest chemical market.
RB reconnects with Beijing
Royal Brunei Airlines (RB) signed an MoU with Beijing Dachengxingye Investing Management Co (BDIM), which will allow RB to resume direct flights to Beijing by December 2017.
The MoU records the cooperation between RB and BDIM on RB’s Beijing route where BDIM will collaborate with RB over the next three years to develop the Beijing market and tourism flows to Brunei Darussalam.
The expansion of RB’s service into Beijing will begin with a twice a week service using the Airbus A320, and move to thrice a week service at the earliest opportunity.
Signing on behalf of RB was its Chief Executive Officer Karam Chand, while Beijing Dachengxingye was represented by its Executive Vice-General Manager Shan Ri Rui.
In an interview after the signing, Karam Chand said RB used to fly to Beijing a couple years ago but at that time RB flew a big 767 aircraft, and perhaps at that time the Beijing market was just starting to develop. But as time passed, Beijing became a huge market, and RB now believes it is the right time to commence flying to Beijing.
The RB CEO also indicated that RB is ready to increase the frequency when the market grows in volume. He said the decision to commence direct flight to Beijing was taken considering various factors.
Brunei and China have significant economic and trade ties, and looking at the success of Shanghai and Hong Kong, RB is confident that the direct flight to Beijing will do well.
With the increased tourism activity with China and with the stronger bilateral relationship with China, it is fitting to establish a direct flight between the two capital cities.
He said that there is strong tourism prospect from China and the tourist flow is likely increase significantly. At the moment the highest inflow to Brunei is from Malaysia, but Karam Chand noted that the inflow from China may grow quite significantly and may exceed the inflow from Malaysia at some point in future.
He added that it is important to have the right local partner who knows the market well, who knows sales, marketing and distribution strategy and who will be able to help RB and establish a strong synergy and collaboration.
“And this is another reason why RB is happy to make this announcement regarding its partnership with Beijing Dachengxingye.”
Azaraimy HH in Nanning