In recent years, China and neighboring countries have achieved fruitful results in infrastructure construction and other fields. After experiencing the challenges of the global epidemic of the new crown epidemic and the rise of "de-globalization", China and its neighboring countries jointly build the Belt and Road Initiative still show strong resilience and vitality. work together towards the goal. In this context, it is necessary to increase the development of cross-border infrastructure projects with neighboring countries [“cross-border infrastructure projects” in this article mainly refer to physical spaces that cross national (border) borders (including land) between different countries or regions The cooperation will also become a new direction for promoting domestic enterprises to "go global" and create economic growth points. In view of this, this paper focuses on cross-border infrastructure cooperation with neighboring countries, analyzes the basic characteristics and risks of such projects, and provides practical suggestions for enterprises to maximize the advantages of all parties and improve the project's anti-risk capabilities.

Opportunities for cross-border project cooperation between China and neighboring countries

For a long time, relations with neighboring countries have played an extremely important role in China's overall development and diplomacy. Although the global pandemic of the new crown epidemic in 2020 has accelerated the evolution of a major change unseen in a century, and the surrounding situation has also changed, the surrounding situation of peace, development, cooperation and win-win is still the mainstream. With the continuous deepening of the Belt and Road construction and the construction of a new development pattern of domestic and international dual circulation and mutual promotion, the partnership between China and neighboring countries has also entered a new stage.

According to the "Blue Book on China's Neighboring Relations: Report on the Development of China's Relations with Neighboring Countries (2021)", as of December 2020, 16 neighboring countries have signed cooperation documents with China to jointly build the Belt and Road Initiative. In particular, in recent years, China and the five Central Asian countries have successively established permanent comprehensive strategic partnerships. In June 2019, China and Russia signed the "Joint Statement on the Development of Comprehensive Strategic Partnerships for the New Era", and completed the "Regional Strategic Partnership for the New Era" in March 2021. The approval of the Comprehensive Economic Partnership (RCEP) will come into force on January 1, 2022. These achievements all demonstrate that the spread of the epidemic will not change the nature of China’s strategic cooperative relations with neighboring countries, but will help further development. Cooperation in bilateral and multilateral fields provides greater impetus.

At the same time, in terms of infrastructure investment, China's cooperation with neighboring countries has also made significant progress. The development and construction of six major international economic cooperation corridors, namely the New Eurasian Continental Bridge, China-Mongolia-Russia, China-Central Asia-West Asia, China-Indochina Peninsula, China-Pakistan and Bangladesh-China-India-Myanmar, have played an important role in building an efficient and smooth Eurasian market. effect. In January 2020, the China-Russia Heilongjiang Bridge also officially passed the acceptance inspection, realizing the direct interconnection between the two prefecture-level cities in China and Russia, adding important cross-border infrastructure to the construction of the China-Mongolia-Russia Economic Corridor of the Belt and Road Initiative and the construction of the Longjiang Silk Road Belt. .

It can be seen that under the background of the normalization of the epidemic, as China continues to promote high-quality joint construction of the Belt and Road, to create a community with a shared future for its neighbors, it will cooperate with neighboring countries in transportation, communication, infrastructure, agriculture, digital economy, industrial parks, tourism, education, finance. In order to expand international cooperation in many fields, bilateral and regional multilateral cross-border infrastructure projects will be prioritized, bringing new opportunities for more domestic enterprises to “go global” and expand overseas investment.

Characteristics and risks of cross-border infrastructure projects

Because cross-border infrastructure projects usually span different sovereign countries or special regions with a high degree of autonomy, and involve the sovereignty and supreme governance rights of different countries, they have distinct characteristics in cooperation forms, cooperation procedures and cooperation content. .

First of all, cross-border infrastructure project cooperation must first follow the international basic principles of inter-governmental cooperation, including the principle of national sovereignty, the principle of common and differentiated responsibilities, the principle of sustainable development, the principle of abiding by promises (promises), and the principle of prudence. The above-mentioned basic principles often need to be specifically reflected through bilateral agreements or multilateral agreements between cooperative governments in specific cross-border project cooperation. Taking the "China-Kazakhstan Horgos International Border Cooperation Center" project in the border area between China and Kazakhstan as an example, China and the Kazakh government signed the "Framework Agreement on Establishing the China-Kazakhstan "Khorgos International Border Cooperation Center" , the agreement is China's first bilateral agreement formally signed by the central government and a foreign government for the establishment of a cross-border economic cooperation zone.

Secondly, unlike general infrastructure projects that are completely located in a country and only apply the laws of that country, cross-border infrastructure projects are regulated by the different legal systems of the country or region because they cross different countries or regions. However, due to various reasons such as the specific rules applicable to the laws of different countries, cross-border projects often lead to conflicts of applicable laws. Therefore, after the relevant bilateral or multilateral agreements are concluded, countries also need to formulate, modify or supplement existing laws and regulations through domestic legal transformation procedures to implement the rights and obligations agreed in the bilateral or multilateral agreements.

Thirdly, the types of projects applicable to cross-border infrastructure are relatively concentrated, mainly transportation infrastructure projects (such as railways, highways, bridges, tunnels, etc.), energy infrastructure projects (oil pipelines, natural gas pipelines, etc.), as well as power and communication infrastructure projects. Such infrastructure projects (power grids, optical cables, etc.), the reason may be that the main purpose of such infrastructure projects is to connect the two places with unbalanced resources (including materials, energy, information, and human resources) to realize the realization of resources. Transmission, such as the China-Kazakhstan natural gas pipeline, the China-Russia Heilongjiang Bridge, the China-Pakistan and China-Nepal highways, etc. are all typical examples of cross-border infrastructure.

Finally, cross-border infrastructure projects focus on combined environmental, social and governance (ESG) impacts. Since 2006, the United Nations Environment Programme Financial Initiative (UNEPFI) and the United Nations Global Compact have jointly issued the United Nations Principles for Responsible Investment, advocating the incorporation of ESG (environmental-social-governance) factors into investment decisions. Still in emerging market countries, ESG has become one of the mainstream investment concepts and practical strategies, attracting more and more attention. Correspondingly, more and more cross-border infrastructure projects have also paid attention to the comprehensive impact of project development on the environment, society and governance, and gradually integrated ESG-related evaluation criteria and factors as a premise for final project decision-making. condition.

Risk identification and management advice for cross-border infrastructure projects

Based on the characteristics of cross-border infrastructure projects, due to the different jurisdictions where the projects are located, the differences in project industries and types, the social environment, and the influence of the international political policy environment, etc., the risk appetite and risk type shown by the project are also different from those of general infrastructure investment. Items vary. Therefore, how to effectively identify and manage risks at three levels, including the country, the market and the project, will become the key to the success of enterprises participating in this type of project investment. Editor / Xu Shengpeng