Bank of China and Sinohydro add to Chinese presence in Portugal

Bank of China and Sinohydro add to Chinese presence in Portugal
Macau Hub, 22 July 2013

URL:
http://www.macauhub.com.mo/en/2013/07/22/bank-of-china-and-sinohydro-add-to-chinese-presence-in-portugal/

Portugal continues to attract large Chinese companies interested in the
European market as well as the Portuguese-speaking African markets, and
now both the Bank of China and Sinohydro are moving into the country.

At the height of the financial crisis and at a time when Portuguese
companies are making great efforts to attract foreign investment, China
is the main source of those investments, starting in 2011 with China
Three Gorges buying a stake in Portuguese power company EDP � Energias
de Portugal and China State Grid Corp buying a stake in Portuguese power
grid company Redes Energ�ticas Nacionais (REN).

The Bank of China now operated in a building in the downtown area of the
Portuguese capital, which was previously the home of Portuguese weekly
newspaper Expresso and Barclays Bank, and the bank's chairman visited
Portugal at the beginning of July for a closed-door ceremony.

At the ceremony, attended by members of the government, the governor of
the Bank of Portugal and the chairmen of some of the country's main
banks as well as business managers, the chairman of the Bank of China,
Tian Guoli, pledged that his bank would help Europe and Portugal to
overcome the crisis and noted that the bank "will continue with its
trend," of focusing on Europe.

"Chinese investors in the last decade looked to the United States and to
Japan, but now its time to cooperate more with Europe, particularly with
Portugal and countries in the south of the continent," said Tian Guoli,
at the opening ceremony of the Bank of China subsidiary in Portugal,
held at the Bel�m Cultural Centre.

China Three Gorges also operates near the heart of Lisbon's business
centre near the Bank of China headquarters.

Weekly newspaper Expresso recently reported that a CTG competitor,
Sinohydro is negotiating to enter the Portuguese market, particularly to
build dams.

This interest was communicated to the Portuguese government, but the
reply was that the hydroelectric portfolio was complete, with projects
from EDP and Spanish companies Endesa and Iberdrola, and that the
alternative would be for some of these projects to become partnerships,
the newspaper said.

Privatisation operations in Portugal, which have become necessary
because of the country's economic and financial crisis, have led to
Chinese companies entering the market.

In 2011 CTG paid US$2.7 billion for 21.35 percent of EDP, Making it the
Portuguese power company's biggest shareholder.

This deal was followed by the acquisition of 25 percent of power grid
company Redes Energ�ticas Nacionais (REN) by the State Grid Corporation
of China (SGCC) for 287.15 million euros.

Solar energy and water and sanitation are new focuses for the activities
of Chinese companies in Portugal.

The Hanergy Solar Group said recently that it had agreed to buy solar
energy parks in Portugal, without naming the seller.

Also in March, French company Veolia announced the sale of its water
business in Portugal, Veolia Water Portugal, for 95 million euros, to
China's Beijing Enterprises Water Group, the leader in water treatment
systems in China.

Beijing Enterprises Water Group is now responsible for supplying water
in four areas (Mafra, Ourem, Paredes and Valongo) and for waste water
treatment in three areas of the Algarve, Portugal�s southernmost region.

This deal was the biggest in the Iberian water sector since 2009, the
biggest in Portugal since 2008 and the first involving a Chinese
investor in the Iberian water sector.

Recently, the Morning Whistle website reported that the board of China
Mobile had started the process of analysing the macroeconomic and
economic climate of five countries, including Portugal, in order to
invest in them.
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