BEIJING: China’s banking industry will become more vigorous through technological innovation and upgrades, rather than perish with the rise of new industries, said Tian Guoli, chairman of Bank of China Ltd.
“When compared with those e-commerce companies such as the one Jack Ma has built, commercial banks sound out-of-fashion and conservative. But as a commercial banker, I feel particularly impressed by the evolution of the industries represented by those names over more than a hundred years… Such a combination of tradition and innovation is the engine of our social progress,” Tian said in a speech at the US-China Business Roundtable in Seattle on Wednesday.
For example, Bank of China is helping China’s Conch Group, the world’s biggest cement producer, build 100 waste treatment plants, where municipal solid waste will be disposed by the residual heat of a cement kiln, said Tian, adding that with this technology, every plant can reduce landfill sites by the area of five soccer fields each year. So the cement industry, traditionally high in energy consumption and high in producing pollution, will be turned into a green economy pioneer.
The process of industrial transformation is painful, especially with the slowdown of Chinese economic growth.
“In a challenging time like this, commercial banks must give more attention to traditional companies. Bank of China now serves 2.8 million corporate clients globally, and thousands of times more corporate employees and individuals… We are obliged to work with them and find a path combining innovation with tradition,” Tian said.
He noted that the economic restructuring brings substantial business opportunities to companies in China and the US and suggested the two countries deepen cooperation.
“We should leverage our respective strengths along the industrial chain, so as to give full play to the US companies’ advantages in information technology, clean energy and new materials, as well as to Chinese companies’advantages in market coverage and production technology,” he said.
General Motors and Ford have recently announced plans to increase investment and upgrade their production lines in China to meet the needs for environmentally-friendly vehicles. Bank of China is willing to provide one-stop financial services for them in this regard, including supply-chain financing and consumer credit solutions, Tian said.
He also suggested the two countries strengthen the cooperation of small and medium-sized enterprises, as well as expand the area of cooperation by jointly exploring the markets of a third country via platforms such as the Belt and Road Initiative.
Proposed by President Xi Jinping, the initiative is a blueprint to develop deeper economic cooperation among countries along a trade and infrastructure network that connects Asia, Europe and Africa.
At present, more than 1,600 companies have been set up in the US with investment from China, creating over 80,000 jobs in 44 states.
“In contrast, Chinese banks have found a lot of difficulty trying to set up branches in the US, with merely four states being covered by Chinese banking presence. We hope the US authority could render more facilitation in this regard,” Tian said.
