| The following mail was sent to a world famous IPP when he came to me for EPC contractors from China and Sinomach, as a Chinese purchasing agent, I personally can help our foreign clients to utilize the resources from China National companies as Sinomach, our group company, CMEC, our brother company.
Dear Henry,
Thanks for your mails.
I should inform you some points so that you can get the right information about Chinese EPC, equipments producers, and services providers.
1. due to our planned economy during the last 40-50 years, Chinese government had the strength to focus its every means to develop some key projects or support its key companies, which has resulted our current competitiveness in the world with quality and attractiveness in pricing. For the benefits of this planned economy you can compare this to India, or other Southern East nations. And this infrastructure will help us probablly to overtake Japan in 20 years and catch up with USA in 30-40 years. Please remember we Chinese national companies are competing in the world as a whole country with different companies and organizations to share different scope of tasks according to its own competitiveness. This is why we now have the courage to compete in the world.
2. During the last 50 years, we Chinese companies, esp. key companies were designated by government to focus their own business lines, so Sinomach, CMEC, and Chinacables�?main business are in the world market as projects EPC, and Harbin, Dongfang, and other services companies’s main business are in equipments production, and design for infrastructure, including power plants. You could not find one companies who are very strong in total line of EPC, from design, manufacturing, procurement, installation, installation, O&M, financing, warranty, and foreign trade. Sinomach with CMEC, Chinacables, Chinaauto, Chinauniteddesign as its subsidiaries is the largest EPC or turn key contractors from China in power industry, it has contracted 70% of the projects from China to world market.
3. Sinomach and its subsidiaries have more than 50 years of EPC contracting experience in the world market, it has the strength and influence among Chinese equipment and service providers for reasons of larger project procurements from them by Sinomach, for more than 50 years as Ministry to governing the whole nation’s machinery and electric industry, Harbin, Dongfang, Shanghai electric were all among the lists of Sinomach’s subsidiaries (several years ago they are handed to local government). But most of these heavy equipments producers and designers still rely on Sinomach and its subsidiaries to explore the world market, even though some of them began to contract in the world, they have a long way to cover.
4. due to long term commercial, political and personal connection with national heavy equipment producers and service providers, Sinomach still acted as a consortium main member to compete in the world, some times in the form of its subsidiaries. When Sinomach and its subsidiaries works on some projects, the other Chinese members from producers, to designers would feel comfortable, safe, and sure to complete the total projects in high performance, timely delivery and COD. If Sinomach and its subsidiaries could not compete a project in high performance, timely COD, nobody else can from China could.
Now everybody is reverting to China, and the reputable producers are full of orders, I think you have some personal of this impression when you visited their facilities. And CMEC, Chinacables, and Sinomach are very business with projects, this is why I have told you that they only wish to invest time in projects from reliable buyers, serious buyers, and do not wish to waste time in no serious projects. For example, my classmate, he just returned yesterday from Africa with a contracted signed about 600 millions USD. The contract is supported by Chinese government concessinal loans. So this is why he does not want to meet for lengthy tendering and negotiation. He has the means to get Chinese government support, in August he sponsored a 450 millions USD power project in Sri Lanka. Sinomach now signed MoU with Indonesia government for supporting them with power plants, among which 2x300mw already signed by using part of billions USD our Chinese would supply to them.
So I can frankly inform you that if you are willing to accept Chinese EPC, Sinomach or CMEC is the best choice, nobody else can overtake them from China. Many world reputable contractors who once took Chinese equipments and EPC as nothing bu wastes, now are asking us to OEM or purchase or subcontract or produce for their projects. I think they are beginning to feel some pressures from our competing. Please refer to what Japanese has brought competition to Western competitors in the 1960, today Western companies would face heavier pressure in competition in heavy equipments in 2010-2050, not just by lower price but most important by quality from reputable stated owned companies as Sinomach, Sinopec, Sinosteel, ChinaAluminium, Chinamobile, this process is going day by day which is reflected as an iceberg by American Aluminum’s selling all of its 8% stocks in Chalco.
As to the design companies, we Chinese usually name them Larger Six, including one from Sinomach, other five are under two Chinese grid companies. Even though I can not answer you in details due to other reasons, you can see their strength in design for Sinomach and its subsidiaries in the world market, and other five IPPs from China, who have supported China with enough and unbreakable power supply. These designers are as busy as equipments producers, and EPC too. Main and reputable designers are comfortable to work with Sinomach and its subsidiaries for more than 50 years in the world. China�?connection society will help to forge relation between them.
So from above, Sinomach and its subsidiaries as main consortium member with other reputable equipment suppliers, services suppliers will be capable for your projects. And it is the best choice if you wish to look for EPC from China. This is 100% the truth. And I suggest you do not waste your valuable time to go around to dig information, sometimes you could not get the right and compete one due to language, political, cultural difference and business practice.
Most of the designers are affiliated to Grid companies, and 95% of their foreign business are from EPC such as Sinomach and its subsidiaries. Some of the second level designers are just beginning to try to EPC for small projects up to 100mw.
Due to confidential issues and business practice, we can not fill in all the information in the questionnaire you provided last time. But please be assured that your 2x600mw level project is nothing to surpass our capability from Sinomach or CMEC. If you are really serious, please enter negotiation with Sinomach under the coordination of myself, this will save your and our valuable time. |
China National
Electric Wire&Cable Imp./Exp. Corp
