China, United States Ink Historic Deals Worth $253.5 Billion
10 November 2017
EIRNS—A total of $253.5 billion in deals were signed on the occasion of the summit in Beijing between Chinese President Xi Jinping and his U.S. counterpart Donald Trump which Chinese Minister of Commerce Zhong Shan described as a "miracle." In at least one case—the deal between GE and China’s Silk Road Fund—the focus was explicitly around the Belt and Road Initiative (see separate slug).
By far the largest agreement (it is a Memorandum of Understanding) is an $83 billion investment over 20 years in shale gas, producing petrochemicals, and building new electric power plants in the state of West Virginia. On the Chinese side it involves a joint venture formed by China’s Shenhua Group Corporation, described as the "world’s largest energy company," and Guodian Corp., which produces power plants.
The second-largest deal is also petrochemicals, in this case LNG. It is between the State of Alaska and Alaska Gaseline Development Corporation (AGDC), and the biggest Chinese banks and petrochemical firms—China Petrochemical Corp (Sinopec), China Investment Corporation (CIC), and the Bank of China (BOC). It is a Joint Development Agreement, with Chinese institutions investing up to $43 billion, and it is supposed to create 12,000 jobs in the United States and reduce the trade deficit by $10 billion per year.
Then comes Boeing’s deal to sell 300 aircraft, valued at $38 billion. And there is another LNG deal in Louisiana, in which China Gas Holdings will develop a floating LNG export platform.
Gong Ting, assistant research fellow at the China Institute of International Studies, told Global Times:
An unmistakeable wave of optimism and enthusiasm is coming from the American companies and the U.S. states involved. Honeywell CEO Robert Tedjarati, interviewed from China, said that "megatrends in China are still positive. We still view China as the place where the largest contribution to our growth happens." The deals, he said, were signed, "the real thing." Sen. Shelley Moore Capito (R-WV) said the deal involving her state "will have a transformative effect on our economy, our security and our future."