Chinese company invests US$2B in Chch rebuild
By Patrick Smellie
Christchurch City Council is rolling out the welcome mat for Guoxin International Co, one of China's largest infrastructure development companies, which is committing to raise a US$2 billion (NZ$3.2b) fund for investment projects in the city's post-earthquake reconstruction.
While the letter of co-operation and friendship signed between Guoxin and Christchurch Mayor Lianne Dalziel is non-binding, the relationship marks a major step in attracting new investors to the city and has the strong backing of the Chinese government, councillor Raf Manji told BusinessDesk.
"This is a very serious commitment from a very reputable and large Chinese organisation to invest in Christchurch, but to do so alongside the community," said Mr Manji, who works closely with Ms Dalziel on the city's financial challenges.
While Guoxin was not the first Chinese investor to express an interest in finding work in the Canterbury reconstruction, the experience to date had been that most would-be Chinese bidders had missed out because of a lack of mutual understanding, said Mr Manji.
"A lot of international capital has arrived" to back the rebuild, and "Chinese investors have come down and tendered for projects, but haven't got anywhere," he said.
"That may be because they hadn't established their bona fides in New Zealand", despite in many cases being large, appropriately qualified companies.
"You know, some of them have built 300 hospitals and all we need is one hospital, one port. It can be a bit like an elephant mating with a mosquito."
The Guoxin announcement was intended to signal to international investors that Christchurch is "open for business", Mr Manji said.
For its part, Guoxin has committed to raise funds to apply to Christchurch projects, which have yet to be identified and won, in areas such as infrastructure, property, and general investment.
The Chinese firm, which is privately owned but grew out of a state-owned enterprise, is described on its website as the international arm of China's largest procurement and tendering company.