Corrs High Vis: Episode 31 – China’s Belt and Road Initiative

Xiaoyan (Mindy) Jin, Partner, Construction Dispute Resolution, Corporate Governance and Employment Law, Jiangsu Baijin Law

Celeste Koravos - Welcome to Corrs High Vis my name is Celeste Koravos, Senior Associate in Corrs’ Construction practice. Recently we have been lucky enough to host Xiaoyan Jin at Corrs as part of an eight week training program on Australian Law. Mindy is a partner at Jiangsu Baijin Law Firm in Jiangsu a key business city in China with a population similar to Melbourne. Mindy specialises in construction dispute resolution, corporate governance and employment law. She has a background as an oil analyst at McGraw-Hills Group and as an accountant at China Merchants Bank in Gansu. Now domestically we have experienced Chinese investment in our Australian construction projects due to the stability and attractiveness of our economy and construction pipeline. But let’s hear from Mindy about the broader regional opportunities for the construction industry to do business with China. Mindy China’s construction industry has experienced very strong growth domestically and is recognised for impressive international achievement. What policy initiatives do you think have contributed to this?

Mindy – Well I think it is a really good question. If you want to know China’s great development in construction industry you always need to have some ideas about China’s important policies like the bringing and going out policy and especially the Belt and Road Initiative. This initiative is huge. Nowadays in China if you do not know this concept I guess you are totally out. Everybody is talking about it because it is tremendously publicised by all media. So if you are interested I guess you can just find about that information about this so I will not talk about a lot of detail here. But for your better information I can explain the initiative to you based on my own understanding. This is a policy proposed by our President Xi Jinping who has dedicated to bringing more prosperity to China’s economy through the promotion of this initiative. So what is it? You must know the ancient China’s Silk Road, right, that is the ancient roads of trade from China through many Asian countries, through the Europe like Great Britain UK which actually brought greater prosperity to Asian China and the relevant nations. Without this Silk Road actually you would not have had such things as black tea, your silk, china’s and many other good stuff. The current Belt and Road Initiative is just like an upgrade or renovation of this ancient Silk Road. Yes based on the historical road there is an expansion of the areas of the Nations involved now. There are more than 50 countries among which Australia is a very important one. Now let’s come to the construction part. Yes for the purpose of promoting the connectivity between China and all these countries along the road both land based and sea going route. Billions and billions worth of projects of infrastructure construction are involved like rail roads, highways, air routes, oil and gas exploration, ports and so on. So isn’t it a good opportunity for us construction lawyers.

Celeste Koravos – So Mindy it is quite interesting to us in Australia to learn about how China has so much diversity and do you find for participants in construction projects in China they might be experiencing different laws or different contracts depending on where the project is located and who is sponsoring the project?

Mindy – Actually in China we have one single legal jurisdiction. Actually we should follow the same law, I mean laws involved like construction law, like the tendering and the bidding law, like the contract law, like the general provisions of civil law and together with some judiciary interpretations and local decrees, things like that.

Celeste Koravos – Mindy, China is a sophisticated and rapidly developing country. How can Australian companies improve their chances of doing business successfully with Chinese companies?

Mindy – Actually it is not about which country comes into China to make the investment. Any investment that is popular in China is dependent on whether it can say be a high tech, something can be helpful for the improvement of the society. Anything like that is welcome not only – it’s not about whether you are from Australia or that he is from America. But anything good is acceptable, yes welcome.

Celeste Koravos – That’s fantastic, so it sounds like China is very open to overseas investment and participation in its construction projects. Is there anything that overseas investors in China should be aware of about the business practices being different for example, relationships and the importance of relationships in China?

Mindy – In China, first of all we adopted the rule of law. Everything I mean in the construction industry if you needed to do a project there it is of course you should follow the law. But anyway China is still I mean a culturally speaking China is a relation society so if you really know this guy I mean you have a close relationship I mean in any society maybe things like what like that. Things can go more convenient but it’s not to say okay you can just go beyond the law. Of course within the legal framework it is more convenient to I mean to improve the efficiency.

Celeste Koravos – And it sounds like that communication is very important. I have heard that in China WeChat is quite a popular platform for communication in business. Could you please tell us a little about that?

Mindy – Well WeChat actual is a very popular communication tool widely used in China actually. Nowadays you cannot send – if you cannot share – I mean you may not choose to send your message but you will always use the WeChat because it’s really convenient. You can chat on WeChat, you can have a meeting face-to-face on WeChat, and you can send document files on WeChat, it’s even better than a laptop because you cannot always take a laptop 24 hours with you but you can take a cell phone with the cell phone you can use the WeChat and one more thing. Nowadays I mean legally if you have a legal dispute and you have some WeChat communication record there, that record can be admissible in court as evidence.

Celeste Koravos – Thank you so much Mindy for your interesting insight and no doubt China is and continues to be a very important part of Australia’s future in terms of the construction industry and more widely so thank you for your time and it’s been really a pleasure spending two weeks with you in Corrs’ construction team.

Mindy – Yes thank you.

Celeste Koravos – We spoke with Mindy about Chinese investment more broadly as part of the rail and road initiative. This has seen unprecedented investment in infrastructure including ports, rails, bridges, oil and gas pipelines and roads within China across Europe and Asia and through the Indo-Pacific. So far Australia hasn’t joined the 70 odd countries including New Zealand to have signed a memorandum of understanding to join the initiative. However given the trillions of dollars’ worth of infrastructure funding needed in Asia perhaps over the next few decades we might see this change. If you would like to get in touch with Mindy for Chinese legal advice please contact a member of the team here at Corrs.

This podcast is for reference purposes only. It does not constitute legal advice and should not be relied upon as such. You should always obtain legal advice about your specific circumstances.