Writing those OBOR contracts

AUSTRALIAN providers of professional services – in finance, legal, accounting, civil engineering, construction and consultancy —can offer enormous experience and knowledge in the early steps required to secure major infrastructure projects associated with China’s One Belt, One Road initiative . . .

Charles Ng, Acting Director-General of InvestHK, believes Australia’s understanding of building infrastructure projects in developing countries, not to mention pioneering projects in isolated parts of Australia, is a resource that should not be under-estimated.
“You have expertise in creating the investment proposition for cross-border infrastructure,” he says, “as well as the ability to create the platforms that will drive and protect these platforms.
Hong Kong is positioning to play a key role as a financing hub for OBOR projects, in part through an Infrastructure Financing Facilitation Office (IFFO).
This has been set up by the Hong Kong Monetary Authority, which acts as Hong Kong’s central bank.
Ng says InvestHK is working closely with the IFFO to attract parties able to offer expertise in developing sound financial and legal frameworks for private sector infrastructure projects, frameworks that give comfort to investors that they can anticipate realistic financial returns over long pay-back periods.
Hong Kong, he says, also has the ability to build bridges to leverage funding for OBOR through the Hong Kong-Shanghai Connect and Hong Kong-Shenzhen Connect of the Hong Kong Stock Exchange.
IFFO’s mission is to facilitate infrastructure investments and their financing by working with a cluster of key stakeholders.
“We are talking infrastructure — energy and power stations, seaports, airports, roads, railways, bridges — and as countries start developing these kinds of things they will need lawyers, accountants, different kinds of professional service providers, to help them put it all together,” Ng told ATI Magazine.

“Australia has real expertise in handling these types of projects, in building them up, not just in engineering and financing but in risk management, project management and new forms of infrastructure technology, much of it drawn from the mining industry,” he says.
“A lot of that mining technology can be transferred to other projects, and I think Australia has a lot of expertise to leverage on.”
Hong Kong, Ng says, has a deep pool of services providers — “90 per cent of our GDP is through services” — and the knowledge that Australia professionals can bring to the table partners ideally for OBOR projects.
As he sees it, fintech, along with cyber security, is also going to play a huge role in OBOR.
“Cyber security now applies to every aspect of life, from e-commerce to health, to financial services, to manufacturing 4.0, so there is a lot of potential business coming our way.
“Again, Australia can offer expertise.”
He points to block-chain technology where, he says, Australian professionals can transfer knowledge to Hong Kong.
“In Hong Kong, we do not have widespread knowledge of that technology,” he says. “We are desperate to teach our high school and even primary school students, as well as those in universities and the talent at our banks, about this new technology.”
Ng says he learned more of the synergies that exist between Australia and Hong Kong during a roadshow in which he presented InvestHK’s ambitions for OBOR to professional firms and industry bodies, along with tertiary education providers and university start-up laboratories, in Perth, Melbourne and Sydney.
“To those companies specialising in all aspects of infrastructure, I say you will be able to get a piece of the (OBOR) pie,” he says.
“The beauty of an OBOR project is that it is a collaboration with several countries, cross-cultural, cross-sector, and can be a win-win for all involved.”
And the implementation of OBOR projects, he adds, is going to continue for decades.
Ng also sees opportunity for Australia to help service Hong Kong’s future health needs, in particular with regard to the ageing.
Hong Kong, he says, is looking at regenerative medicine as well as preventative medicine.
“We are focussing on health-tech,” he told ATI, “because a recent study out of Japan shows Hong Kong to have the longest-living people in the world — an average age of 82 for men and 87 for women.
“Hong Kong is going to see an increase from 15 per cent of the population over 60 years of age now to 35 per cent in the next 20 years. A lot of those ageing people are educated, and they are not stopping work because they are over 60.
“They have assets and they want a healthy prolonged life, and it is medical advancements and technology that can enhance their lifestyle.
“Australia has a lot of capability in health-tech and health science R&D, and we are looking at how we can collaborate with Australian entrepreneurs and universities to bring new technology to commercialisation, to bring access to markets in a scalable way.
“We have two medical schools – at the Chinese University of Hong Kong and at the University of Hong Kong — both well-known for their medical research, and they want to develop collaboration with other world-class universities around the world.”
Of other areas of potential synergy with Hong Kong, Ng points to fin-tech, where, he says, a lot of innovation is coming out of Melbourne.
Australia also, he says, has been developing smart technology for smaller homes, and could undertake R&D in this area in Hong Kong — which has one of the densest ecosystems in the world — to showcase for markets in Mainland China, ASEAN and India.