Chinese Stimulus Package Gets Canadian Companies' Attention
Canadian companies currently doing business in China are eager to get a share of the country's dramatic four-trillion-yuan ($718-billion) stimulus package.
The companies hope to be able to use existing Chinese partnerships to cash-in on massive new spending in transportation, low-cost housing and green technologies.
Bombardier Inc. and industry group Canada Wood are working on the highest-profile efforts.
The stimulus financing is still in its early stages, however, it is anticipated Bombardier will bid on contracts for upgrades and expansions to China's railways and air links, while Canada Wood is encouraging the use of Canadian wood in low-cost housing programs and rebuilding in the Sichuan earthquake zone.
It is possible
smaller Canadian companies working in information technologies, environmental science and health care could to benefit, even if indirectly, from the stimulus package.
“We feel the companies who are already in China, and in the sectors under the stimulus package for sure, are going to get benefits, [although] not directly,” said John Shou, managing director in Beijing for the Canada China Business Council.
“The Chinese government didn't create the stimulus package to save foreign companies,” . Shou said.
“For international companies to get a piece of the cake they need strong Chinese partners, or a niche that the Chinese desperately need.”
Bombardier China president Zhang Jianwei said.
“We are actively following the Chinese economic stimulus package and related projects. Even prior to the announcement of the economic stimulus package, China was spending billions of dollars on transportation infrastructure, and with the stimulus plan both the pace of spending and the range of projects are increasing,” Zhang said in an interview conducted through a company spokesman.
“I look forward to seeing more good news from our China operations this year.”
Canada Wood has been deeply involved along with the B.C. government on reconstruction in the area of Sichuan province devastated by an earthquake nearly a year ago.
Canada Wood is demonstrating construction of low-cost wood housing for the disaster zone. The company hopes Canadian technology and materials will be chosen as an alternative to concrete for single-family dwellings and low-rise apartments.
“The Sichuan earthquake created, out of a terrible situation, an opportunity to do some public buildings,” said Fred Spoke, managing director of Canada Wood China.
Fully 25 per cent of the Chinese stimulus plan is to go toward rebuilding in the earthquake zone, with another 1.5 trillion yuan going to the upgrading of public infrastructure and 370 billion yuan to rural development.