David Paull was born in Australia, got his MBA from Cornell University in New York, worked in Madagascar and Mozambique, and has made Ulan Bator, Mongolia, his current home. On April 25, Paull, Executive Chairman of Aspire Mining, which is developing coking coal deposits in Mongolia for steel producers in China and Russia, was at the Second Belt and Road Forum for International Cooperation (BRF) in Beijing to sign an agreement.

The contract was with construction and engineering company China Gezhouba Group International and China Railway Construction Corp. to build a 550-km railway in northern Mongolia. It will connect the Ovoot coking coal mine that Aspire is developing to Mongolia's Northern Rail Corridor going up to the Russian border.

"It is the cheapest and most efficient way to transport the coal to China and Russia," Paull said. "Transport time and cost will be slashed dramatically. The distance to Russia will be 40 percent shorter."

It will also be an economic route to the vast Chinese market for Russian exporters.

Aspire chose the Chinese companies because of their capability and funding prospects for connectivity projects under the Belt and Road Initiative. "It is an international mix," he said.

In its sixth year, the Belt and Road Initiative is showing several new trends. The first is the internationalization of the projects under its framework. Paull and his project represent the kind of international cooperation in trade and infrastructure development for mutual benefit the Belt and Road Initiative envisions to connect places along and beyond the ancient Silk Road routes.

"The projects are moving away from bilateral agreements between two countries to package deals," Rajit Nanda, Chief Investment Officer at Acwa Power, a Saudi Arabia-headquartered company engaged in power generation, desalinated water production and renewable energy plants, said.

Acwa's top officials were present at the Belt and Road CEO Conference, one of the events at the Second BRF on April 25, to sign three agreements. The first was with China Gezhouba to build a 1,200-MW coal-fired power plant in north Viet Nam that would require about $2.5 billion. The second was with Power China and SEPCO Electric Power Construction Corp., also from China, to construct a $900-million power and desalination plant in Abu Dhabi, the United Arab Emirates (UAE).

"These are megaprojects," Acwa CEO Suntharesan Padmanathan said. "There's no way one country can do them on its own. Through collaboration we have greater strength."

Acwa's footprints in Africa are coinciding with the Belt and Road's. "We are now focusing on Africa and that's why China has become a very important partner for us," Nanda said. "It is a win-win partnership."

Private pragmatism

Besides internationalization, the other trend is the greater engagement of the private sector. "The first CEO conference shows that," Padmanathan said. "The private sector is being more encouraged."

Tabassum Mostafa, the 25-year-old Managing Director of GM Holdings, echoed Padmanathan. GM Holdings, a 15-year-old business group in Dhaka, Bangladesh, is developing a $400-million real estate project in the Bangladeshi capital, comprising shopping malls, hotels and commercial offices. The company signed a contract with Power China on April 25.

"The private sector can go in directions where the government cannot," Mostafa said. "We hope to have more such collaborations, both with Chinese and others. The development of infrastructure would promote tourism and other industries."

Shahinoor Rahman, Chief Operating Officer of GM Holdings, described the benefit of international partnership. "The cooperation with Chinese and other partners gives us an opportunity to develop infrastructure fast," he said. "This project would have taken us 10 years on our own. The Chinese contractor will complete it in three years."

Acwa's Nanda's presence at the forum exemplified the private sector's greater mobility. The Indian Government did not take part in the forum due to political concerns but Nanda, an Indian businessman from the private sector, had no restrictions.

"I am very positive about the way China has gone about to reach out using economic means," he said. "That is the direction toward which the world is gravitating."

There were more examples of the private sector from different countries working together even when there were disagreements among their governments. A display in the China National Convention Center in Beijing, where the CEO conference was held, exhibited projects in the Belt and Road countries. One of them was Noor III, the world's largest solar energy project being built in Morocco to generate 950 MW at a whopping $4.2 billion.

Besides Acwa, the megaproject involves companies like Dubai Utility Co., Shanghai Electric, Spanish multinational Abengoa, several Chinese banks and U.S. solar company BrightSource Energy, despite trade frictions between the U.S. and China.

As Chinese President Xi Jinping said at the official inauguration of the Second BRF on April 26, the initiative goes two-way—"Belt and Road cooperation has both generated new opportunities for the development of all participating countries and opened up a new horizon for China's development and opening up."

Two-way partnership

On one hand, businesses from outside China are eyeing both the huge Chinese market and the other markets they can enter through China, like Central Asia and ASEAN. On the other hand, Chinese companies are exploring gateways to Europe and Africa.

Karim Amor, President of the Asia Committee of the Confédération Générale des Entreprises du Maroc (CGEM), was on his third visit to China. The CGEM, an umbrella of 33,000 direct and affiliated members, represents Morocco's private sector. Amor's mission this time was to take Chinese and other Asian entrepreneurs to Morocco so that they can go together to other French-speaking African countries.

"Morocco is very well integrated with other French-speaking countries, having nearly 50 years' cooperation," he said, enumerating the advantages of his country for private entrepreneurs. "We also have an ideal geostrategic location, being just 12 km from Europe. Besides, we have several free trade agreements (FTAs)—the Agadir Accord with Egypt, Jordan and Tunisia, and FTAs with Europe as well as the United States, which is very important for Chinese companies because of the trade frictions between China and the U.S."

The CGEM, working in over 30 sectors spanning energy, construction and sustainable development, regards the Belt and Road Initiative as a platform that for Morocco opens the door to Asian countries, and for Asia, to North and West Africa through Morocco. Amor was happy to mention that Morocco's BMCE Bank of Africa has opened its first branch in China.

The bank opened in Shanghai's business district Pudong on April 23, offering its network of more than 1,600 branches to Chinese investors to do business in Africa and Moroccan businesses to find markets across Asia.

The Chinese private sector is also playing a catalytic role in the globalization of business. Sean Xiao, Vice President of MIE Events, takes pride in the fact that his organization, which plans trade events abroad, was the first Chinese company of its kind to enter the UAE in 1999. Xiao, working with a Dubai consultancy company that provided knowhow to small and medium-sized enterprises (SMEs), saw Chinese SMEs had little idea how to enter the Middle East and Africa and so, MIE was born to build a trade and cultural bridge between China and the Middle East and North Africa.

Today, MIE's signature event is the China Trade Week (CTW), covering both these regions. This year, the CTW calendar kicks off in Ethiopia in May, from where it will travel to Kenya, South Africa, Ghana and other places, ending in December with exhibitions in Morocco, Algeria, Saudi Arabia and Oman.

"When we started the CTW in Kenya in 2015, only 100 Chinese companies came," Xiao said. "This time, there are 600. With the scale expanding, we now have to hold the event in two phases."

The CTW's target is not simply to stimulate sale of products but to bring Chinese and African countries together as partners. He gave the example of a Chinese electric bike company that has set up an assembling factory in Nairobi, Kenya.

"The parts are shipped from China and the Nairobi factory employs 200 locals to assemble them," he said. "They use the cycles for delivery services."

Reckoning with risks

However, despite the vast channel opened by the Belt and Road Initiative, risks still abound, especially for the private sector. Xiao's advice is to choose the investment destination carefully. Besides the geographic location, it is also important to see if the country offers any special benefits to foreign investors, he said. Kenya, for example, offers visa on arrival or e-visa to Chinese travelers while Morocco allows Chinese visa-free stay from 2016.

Before entering a foreign market, especially in Africa, Chinese companies need to look for a good local agent since a lot of local SMEs are not well-versed in export-import dealings. They also need to see how easy or difficult it is to access foreign currency in that country. In Ethiopia, for instance, due to the regulations, it takes a long time for Ethiopian buyers to acquire dollars, which slows down business.

But the most important thing is security. The recent terrorist attacks in Sri Lanka, where the victims included British, Chinese, Spanish and Turkish nationals, show how globalization means both shared weal and woe.

Acwa's Padmanathan, who is originally from Sri Lanka, said the only way to prevent instability is through greater cooperation. "The more integrated we are, the more difficult it would be to push us apart," he said. "Through collaboration we have greater strength for security, development and social upliftment."

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