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 Energéticas 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 Belém 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 Energéticas 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, Ourém, 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. (macauhub)