China now exporting infrastructure investment to ASEAN

Two-way investment, big-ticket infrastructure projects, the development of e-commerce and cross-border RMB transactions will play a bigger role in China-ASEAN economic ties, officials said on Tuesday.

Chen Zhou, director of the department of Asian affairs of the Ministry of Commerce, said commodity, agricultural and low-end products are no longer what dominate China's trade with members of the Association of Southeast Asian Nations.

As prices are high for many goods and infrastructure projects, and market competition is less intense in Southeast Asia, China's business model there has changed from exporting goods to establishing manufacturing facilities, as well as research and development centers and sales networks. It also hopes to sign contracts for highway, port, dam and energy projects in the region, Chen said.

"This shift could have great business implications as it comes at a time when both sides are eager to diversify and adjust their industrial structure for exports," he said at a media conference organized by the State Council Information Office.

Investment between China and ASEAN countries hit $120 billion by the end of June this year, with $40 billion from China and $80 billion from ASEAN.

"Such two-way investment as China's infrastructure projects in ASEAN will not only further the exports of China's electromechanical products and construction materials, but will also promote overall trade cooperation," Chen said.

Trade between China and ASEAN jumped 10.9 percent to $444 billion in 2013, eclipsing the 7.6 percent increase in China's total foreign trade.

China is the largest trading partner of ASEAN, and the group has emerged as China's third-largest partner, a major investment destination and an important tourist destination.

To mark the first year of the Diamond Decade of China-ASEAN cooperation and the start of efforts to build the 21st century Maritime Silk Road supported by the governments on both sides, the 11th China-ASEAN Expo will be held in September in Nanning, capital of South China's Guangxi Zhuang autonomous region.

Zhang Xiaoqin, Guangxi's vice-chairman, said Australia has confirmed its participation in the expo as a special guest country. This mechanism will expand service coverage of the expo to a regional comprehensive economic partnership.

"The Beidou Satellite Navigation System, offshore engineering products, the development of e-commerce, new sources of energy and environment protection will help upgrade bilateral cooperation from traditional sectors to high-end fields, and drive economic growth of all the countries concerned during the expo," Zhang said.

Trade between China and ASEAN grew 4.8 percent year-on-year to $220.7 billion in the first half of the year.

Wang Jinzhen, vice-chairman of the Beijing-based China Council for the Promotion of International Trade, said Chinese companies should be prepared to add more high-tech elements to their products if they want to cash in on the growing trade between China and the ASEAN countries.