China Power Construction Corporation Limited (hereinafter referred to as "PowerChina"), formerly known as China Water Resources and Hydropower Construction Co., Ltd. (hereinafter referred to as "Sinohydro"), was jointly established on November 30, 2009 by China Water Resources and Hydropower Construction Group Corporation and China Hydropower Engineering Consulting Group Corporation. In 2011, it was listed on the main board of the Shanghai Stock Exchange. Table 1 shows the company's development history.

表1 公司发展历程
年份	重要事件
1989	中国水利水电建设集团有限公司成立
2003	中国水电工程顾问集团有限公司成立
2009	中国水电集团联合水电顾问集团，共同发起设立中国水利水电建设股份有限公司
2011	中国水利水电建设股份有限公司在上海证券交易所上市
2014	公司更名为“中国电力建设股份有限公司”，证券简称由“中国水电”变更为“中国电建”
资料来源：中国电建年报。

China Power Construction Corporation takes "building clean energy, creating a green environment, and serving smart cities" as its mission, and is committed to becoming a world-class enterprise with global competitiveness. In the process of development, the company has always focused on its main business and consolidated its market leading position in the field of hydropower; At the same time, actively adjusting the industrial structure and cultivating new industrial growth points based on our own advantages and national policies. In addition, the company continued to promote the internationalization strategy, seized the national "going out" strategy, the "the Belt and Road" initiative and other policy opportunities to boost the development of overseas business of enterprises. After more than 10 years of operation, China Power Construction has developed into a leading enterprise in the global power and energy infrastructure field. It has undertaken the design and construction of over 80% of large-scale hydropower stations in China, and has undertaken over 65% of the planning and design tasks for wind and solar photovoltaic power generation. It has over 50% of the global market for large and medium-sized water conservancy and hydropower construction. At present, Powerchina's business covers more than 130 countries and regions around the world. It is the leader of global clean low-carbon energy, water resources and environmental construction, the backbone of global infrastructure connectivity, and the leading enterprise serving the "the Belt and Road" construction.

In recent years, China Electric Power Construction Corporation has set the vision of "building a world-class enterprise and creating a globally outstanding brand", and has formulated the strategic goal of "focusing on large-scale infrastructure, focusing on" water, energy, sand, city, and data ", integrating" investment, construction, and operation ", and promoting globalization". It is committed to building a world-class enterprise that leads the development of green and low-carbon industries and technological innovation worldwide. Figure 1 shows the composition of China Power Construction's operating revenue in 2022. From Figure 1, it can be seen that engineering contracting and survey and design are the core businesses of the company, contributing the most to the company's operating income, accounting for 88.57% of the main business income; Power investment and operation are the key businesses of the company, with a total annual operating revenue of 23.814 billion yuan, accounting for 4.18% of the main business revenue. Among them, the operating revenue of the new energy business is 8.641 billion yuan, with a gross profit margin of 55.70%, making it the highest gross profit margin business of the company. Other businesses mainly include equipment manufacturing and leasing, development and sales of sand and gravel aggregates, commodity trade and material sales, franchise rights and service industries, as well as real estate development business. This sector achieved a revenue of 41.259 billion yuan in 2022, accounting for 7.25% of the main business revenue.

Figure 2 shows the total assets and operating income of China Power Construction Corporation from 2016 to 2022. It can be seen that the total assets of the company are generally on the rise, with a fast growth rate, increasing from 500.278 billion yuan in 2016 to 104.078 billion yuan in 2022, more than doubling the scale, reflecting the stable growth of the company's operating scale. The overall revenue of the company has shown an upward trend, maintaining steady growth from 2016 to 2018 and then maintaining high-speed growth thereafter. The revenue increased from 238.696 billion yuan in 2016 to 571.649 billion yuan in 2022, with a total growth rate of 139.49%, reflecting the company's good operational capabilities. Figure 3 shows the changes in net profit of China Power Construction from 2016 to 2022. It can be seen that the company's net profit has maintained stable growth and shown an upward trend, increasing from 7.586 billion yuan in 2016 to 15.684 billion yuan in 2022, with a total growth rate of 106.75%, reflecting the good profitability of China Power Construction.

Figure 2: Total Assets and Operating Revenue of China Power Construction Corporation from 2016 to 2022

Figure 3: Changes in Net Profit of China Power Construction Corporation from 2016 to 2022

（2） The domestic development history of China Power Construction Corporation

Since its establishment in 2009, PowerChina has closely followed the national development plan, continuously optimized its market structure, business structure, and industrial structure, and promoted business structure adjustment and industrial chain upgrading through the establishment of subsidiaries, mergers and acquisitions, gradually becoming a super large comprehensive engineering construction enterprise group.

Table 2 shows the domestic development history of China Power Construction Corporation. From Table 2, it can be seen that China Power Construction has always focused on its main business, vigorously promoted the integrated development of the entire industry chain, consolidated its core advantages in the hydropower field, combined with national policies and its own business advantages, cultivated new industrial growth points, and continuously promoted diversified business development. After years of hard work, China Electric Power Construction has gradually formed a horizontal and wide field industrial advantage of "large civil engineering and large construction", with global leading capabilities in water conservancy and hydropower facility construction, water resources and environmental governance and restoration.

表2 中国电建国内发展历程
年份	重要事件
2013	新设立中水电成都建设投资有限公司，强化区域市场投资业务管理；并购武汉南国置业有限公司、河南中新置业有限公司、哈密荣信新能源有限公司等，经营规模得到扩大
2015	购买电建集团持有的水电顾问集团、北京院、华东院、西北院、中南院、成都院、贵阳院、昆明院等八家勘测设计企业100%的股权，形成了集规划、勘测、设计、咨询、监理、施工、安装、采购、制造、运营维护、能源投资于一体的完整产业链
2016	成立中电建（北京）基金管理有限公司，积极构建符合公司战略及市场竞争秩序的PPP等投融资类项目的经营管理模式
2018	初步搭建了以中国电建集团财务有限责任公司、中国电建集团租赁有限公司、中电建（北京）基金管理有限公司、中电建商业保理有限公司为主要平台的综合性金融服务体系
2019	积极探索水生态环境、垃圾分类末端处置、绿色建筑骨料生产等领域，培育新的产业增长点
2020	相继成立西部、南方、北方投资公司，推进公司区域营销体系建设
2021	组建中国电建新能源集团有限公司，整合旗下新能源资产，打造新能源品牌
2022	将持有的房地产板块资产与电建集团的电网辅业资产进行置换，并于同年发布150亿元定增预案，资金投向风电和抽水蓄能等项目
资料来源：中国电建年报。

In recent years, China Power Construction Corporation has closely followed the national strategy and the 14th Five Year Plan, focusing on its main responsibilities and businesses, and committed to structural adjustment and development mode transformation. It has accelerated the adjustment and construction of its "water, energy, sand, city, and data" business layout, integrated industrial chain and supply chain layout of "investment, construction, and operation", and global development layout of regionalization and localization of domestic and foreign markets. The quality, efficiency, and driving force of its business development have undergone profound changes. In 2022, the company's market position was further enhanced, and it ranked first in the "Global Engineering Design Companies 150" released by ENR for three consecutive years; Ranked 5th among the top 250 global engineering contractors by ENR, the world's largest power designer and contractor has a solid position, reflecting the professional strength and industry leadership of China Power Construction in the fields of global engineering general contracting and consulting design.

（3） Overview of the development of POWERCHINA in the "the Belt and Road" co construction countries

Since its establishment, China Electric Power Construction Corporation has always adhered to the strategy of "international business priority development", deeply cultivated overseas markets, and undertaken many international engineering projects. After years of hard work, the company has gradually formed advantages in the international business market, talent, management, funds, technology, and brand, with obvious comparative advantages. As of the end of 2013, the company had established 95 overseas offices in 72 countries and regions worldwide, with overseas projects under construction distributed in 72 countries.

After the "the Belt and Road" initiative was put forward, the company actively responded to the call of the country, actively participated in the construction of the "the Belt and Road" co construction countries and regions, continued to promote the "localization of international operations" by setting up subsidiaries in key countries, realized the localization of production factors such as capital, talent, technology, and promoted the steady growth of the company's business in the "the Belt and Road" co construction countries. As of the end of 2022, PowerChina has established over 300 representative offices or branches in more than 100 countries worldwide, providing infrastructure construction and other services to countries in Southeast Africa, Central and Western Africa, Central and North Africa, Eurasia, Asia Pacific, and the Americas. The level of internationalization has steadily increased, and overseas operating income has steadily increased.

Table 3 shows the development profile of POWERCHINA in the "the Belt and Road" countries. As can be seen from Table 3, POWERCHINA closely follows the national strategic arrangement, actively integrates into the construction of the "the Belt and Road" co construction countries and regions, and has signed and delivered a number of key engineering projects in the fields of energy resources development, power investment and operation. It has established a good brand image in the world, and its brand awareness is constantly improving, gradually becoming a leading enterprise serving the "the Belt and Road" construction.

表3 中国电建在“一带一路”共建国家发展概况
年份	重要事件
2014	参与“一带一路”共建区域内中巴经济走廊能源规划、孟中印缅经济走廊能源合作研究、东盟地区互通互联研究、中缅电力合作总体规划、中阿能源合作、中泰能源合作和南海区域风能、光能规划及示范项目研究和中亚五国可再生能源与电力系统规划
2015	设立海外规划专项资金，开展“一带一路”重点国别市场的电网规划、能源规划和基础设施规划研究；牵头开展我国“一带一路”能源专项规划的编制，启动中亚五国可再生能源规划编制工作；重点推动了中巴经济走廊和亚洲铁路互联互通“一揽子”项目，成功签署了巴基斯坦卡西姆港应急燃煤电站、中老铁路、雅万高铁等一批海外重大项目并顺利开工
2016	签署了尼日利亚希罗罗300MW水光互补电站、以色列克卡夫·哈亚邓340MW抽蓄电站、津巴布韦Kunzvi-Musami大坝—哈拉雷供水项目；成功中标中老铁路Ⅳ及Ⅴ标段、哈萨克斯坦巴丹莎200MW风电项目；报告期内建成并移交的埃塞俄比亚阿达玛二期风电项目已成为中国在风电领域整体“走出去”的标志性工程
2017	承办“一带一路”国际能源高峰论坛，创新了老挝南欧江梯级电站全流域投资开发模式和巴基斯坦卡西姆港应急燃煤电站投资建设模式，成为中资企业参与“一带一路”建设的典范
2018	顺利签约卢旺达胡也公路升级改造、越南油汀420MWdc光伏电站EPC项目、孟加拉国ZEE吉大港1200MW液化天然气联合循环电站等一批重大项目
2020	签约赞比亚3个200MW光伏项目、越南平大310MW海上风电项目、越南禄宁550MW光伏项目、越南薄寮三期141MW海上风电EPC总承包项目等10多个重点新能源项目
2021	深化第三方市场合作机制，与日立ABB电网、维斯塔斯、德国福伊特等国际企业签署战略合作协议
2022	签约阿根廷规模最大输气管道项目、巴西最大垃圾发电项目、“中企海外最大单体风电项目”老挝孟松风电二期等一批重点工程
资料来源：中国电建年报。

Table 3 Overview of the development of POWERCHINA in the "the Belt and Road" co construction countries

In summary, in the process of striving to become a world-class comprehensive construction enterprise with international competitiveness in the fields of energy and power, water resources and environment, and infrastructure, China Power Construction Corporation has continuously implemented international business priority development strategies and internationalization strategies such as global development. The degree of internationalization continues to improve, and the scale of overseas business continues to expand. It has achieved outstanding results in the global market, continuously improved its brand image, and won widespread praise from many countries and regions around the world.

II. Motivation Analysis of Powerchina's Participation in the "the Belt and Road" Construction

（1） Keeping up with the national strategic layout and seizing opportunities for the development of the times

The reason why POWERCHINA actively participates in the construction of the "the Belt and Road" cannot be separated from the proposal and implementation of the "the Belt and Road" initiative. The "the Belt and Road" initiative focuses on policy communication, facility connectivity, unimpeded trade, financial accommodation and people to people connectivity. It is committed to the connectivity of Asia, Europe, Africa and the adjacent seas, and to establishing and strengthening the connectivity partnership among countries. On the one hand, this initiative has released a huge demand for infrastructure construction, providing unprecedented historical opportunities for the overseas development of China Power Construction Corporation; On the other hand, the implementation of relevant policies has provided strong support for POWERCHINA to participate in the "the Belt and Road" construction.

The "the Belt and Road" initiative connects East Asia and Europe, and mainly passes through Southeast Asia, Central Asia, the Middle East, North Africa and other regions. Most of the co construction countries are developing countries with large populations and rich resources, but the overall level of industrialization is not high, infrastructure construction is backward, and there is a strong demand for infrastructure construction such as roads, railways, power, energy development, which creates a good market opportunity for Powerchina, whose main business is engineering contracting, survey and design, power investment and operation. As more and more countries join the "the Belt and Road" initiative, China has put forward the main framework for the joint construction of the "the Belt and Road" - "six corridors, six roads, many countries and many ports", which has promoted the construction of six major international economic cooperation corridors, including the New Eurasian Continental Bridge, China Mongolia Russia, China Central Asia West Asia, China Indochina Peninsula, China Pakistan, Bangladesh China India Myanmar, and has driven the demand of the "the Belt and Road" countries to carry out infrastructure construction, such as railways, roads, ports, and power. POWERCHINA actively participated in the development of the China Pakistan Economic Corridor, the China India Myanmar Bangladesh Economic Corridor, the Silk Road Economic Belt, and the Asia Interconnection Project Cluster, and successfully signed a number of major overseas projects such as the Pakistan Kassem Port emergency coal-fired power plant, the China Laos Railway, and the Yawana high-speed railway, further improving the international business scale and level.

In addition, in order to better promote the implementation of the "the Belt and Road" initiative and boost Chinese enterprises to "go global", the state has provided a lot of policy support. Table 4 shows the specific measures taken by China in investment and trade cooperation, financial integration, and fiscal and tax support. As can be seen from Table 4, China has continuously promoted the liberalization and facilitation of trade and investment, provided financial and tax support for enterprises to participate in the "the Belt and Road" construction, and further promoted the expansion of Chinese enterprises' investment scale in the "the Belt and Road" co construction countries. Most of the businesses undertaken by Powerchina in the "the Belt and Road" co construction countries are large-scale infrastructure construction projects, which have the characteristics of large capital demand, long construction cycle, long recovery cycle, etc. The financing policy support provided by the country has better promoted the expansion of the company's overseas business scale and the improvement of its international operation level.

表4 中国推动“一带一路”倡议实施采取的主要支持措施
支持政策	具体措施
投资贸易合作	1.加快投资便利化进程，加强与“一带一路”共建国家双边投资保护协定，避免双重征税协定磋商，消除投资壁垒 2.与有关国家合作建设境外经贸保税区、跨境经济合作区等，促进产业集群发展 3.拓展相互投资领域，加大传统能源资源勘探开发合作，积极推动水电、核电、风电、太阳能等清洁可再生能源合作，形成能源资源合作上下游一体化产业链
资金融通	1.成立亚投行和丝路基金，为“一带一路”共建国家和地区的基础设施建设、资源开发等与互联互通有关的项目提供投融资支持 2.我国银行业通过银团贷款、产业基金、对外承包工程贷款、互惠贷款等多样化金融工具，合理引导信贷投放，支持项目涵盖公路、铁路、港口、电力、通信等多个领域 3.中资银行积极开展业务创新，为中外资企业提供多元化金融服务，包括为企业跨境贸易提供结算、清算、汇兑等便利性支持，为跨境投资提供财务顾问、并购搭桥、股权融资等投行服务，帮助企业合理评估风险，提供套期保值、掉期等衍生工具有效对冲风险 4.逐步构建起由政策性银行、商业银行和国际性开发机构组成的多元的、开放式的金融服务体系，为“一带一路”建设提供长期、市场化、互利多赢的金融保障支持
财税支持	1.深化国际税收合作，与“一带一路”共建国家签订双边税收协定 2.深化国别税收信息研究，发布“一带一路”重点共建国家的投资税收指南 3.落实对外投资和对外承包工程出口货物退（免）税政策及境外所得税抵免政策等，减轻企业税收负担，促进国际资源共享和国际产能合作 4.推动税收服务优化升级，落实出口退（免）税企业分类管理、简化出口退（免）税流程、简化消除双重征税政策适用手续等规定
资料来源：根据公开信息整理。

Table 4 Main support measures taken by China to promote the implementation of the "the Belt and Road" initiative

After years of planning and practice, the "the Belt and Road" initiative has developed into an important international public product benefiting global development and an important practice platform for building a community with a shared future for mankind. In 2022, Chinese enterprises will invest 141.05 billion yuan in the "the Belt and Road" co construction of national non-financial direct investment. In terms of foreign contracting projects, Chinese enterprises will sign 5514 new contracts for foreign contracting projects in the "the Belt and Road" co construction of the country, with a new contract amount of 871.84 billion yuan. By June 2023, China has signed more than 200 cooperation documents with 152 countries and 32 international organizations to jointly build the "the Belt and Road", covering countries in Asia, Africa, Europe, Latin America and the South Pacific. With the promotion of high-quality construction of the "the Belt and Road", POWERCHINA will still have great potential in the field of international project contracting in the future.

（2） Adhere to international strategic leadership and explore overseas infrastructure markets

Since its establishment, China Electric Power Construction Corporation has adhered to the strategy of "prioritizing international business development", vigorously developing its core business of water conservancy and hydropower construction overseas, vigorously expanding its engineering fields such as thermal power, railway, housing construction, and municipal engineering, and promoting the formation of a diversified development pattern of overseas business. In addition, in order to achieve specialized management of international investment business, in 2012, China Power Construction Corporation established China Hydropower Overseas Investment Co., Ltd., increasing investment, development, and control efforts in overseas markets. In the same year, the company successfully opened up seven markets in Mongolia, Bosnia and Herzegovina, Belarus, Poland, Senegal, Liberia, and Guinea, achieving a breakthrough of "zero" in the high-end market of the European Union. After years of international business development and accumulation, China Power Construction has gradually formed advantages in the international business market, talent, management, capital, technology, and brand, with a high degree of international operation and obvious comparative advantages.

With the "the Belt and Road" initiative releasing the huge demand for infrastructure construction in the co construction country, POWERCHINA has upgraded its strategy of "giving priority to the development of international business" and proposed a three-step development strategy of "collectivization of international business, localization of international business, and globalization of group companies" for global development. In 2016, the company established China Power Construction International Engineering Co., Ltd. to implement group control over overseas business and enhance its international business management capabilities; At the same time, six regional headquarters have been set up in Asia Pacific, the Middle East and North Africa, Southeast Africa, West and Central Africa, Eurasia, the Americas and other places to carry out in-depth development of the key national markets of the "the Belt and Road", and further improve the international business efficiency and brand influence.

Under the guidance of the internationalization strategy, POWERCHINA actively participated in the interconnection of national infrastructure under the "the Belt and Road" initiative. It followed the trend in infrastructure areas such as municipal infrastructure, urban rail transit, expressways, railways, airports, ports and waterways, and successfully signed transportation infrastructure projects such as the China Laos Railway, the China Thailand Railway, the Ya'an Wanzhou High speed Railway, as well as power engineering projects such as the cascade hydropower stations in the southern European River basin of Laos, the Adama Phase II Wind Power Project in Ethiopia, and the Kasim Coal fired Power Plant Project.

Figure 4 shows the overseas revenue of China Power Construction from 2013 to 2022. From Figure 4, it can be seen that the overall trend of overseas income is on the rise, increasing from 37.025 billion yuan in 2013 to 74.824 billion yuan in 2022, more than doubling in 10 years; From the perspective of growth rate, overseas revenue grew rapidly from 2013 to 2019. In 2020 and 2021, overseas revenue declined significantly compared with 2019, mainly due to the impact of the COVID-19, and the suspension of performance of some overseas engineering contracting, survey and design businesses.

Figure 4: Overseas Revenue of China Power Construction Corporation from 2013 to 2022

To sum up, POWERCHINA has unswervingly implemented the strategy of "giving priority to the development of international business". After years of development, the company's overseas business covers water conservancy and power construction, highway and rail transit, municipal administration, housing construction and other fields, and gradually formed a diversified market pattern centered on Asia and Africa, radiating the Americas, Oceania and Eastern Europe, which is highly consistent with the planning layout and business fields of the "the Belt and Road" initiative. Therefore, under the guidance of the company's international strategy, POWERCHINA has deeply integrated into the construction and market development of the "the Belt and Road", successfully completed a number of major projects, and constantly improved its brand awareness and market position. Nowadays, China Electric Power Construction has become one of the backbone forces serving global infrastructure interconnection.

（3） Give full play to international business advantages and build a world-class enterprise

Before the "the Belt and Road" initiative was put forward, POWERCHINA already had a relatively complete international marketing network, rich experience in overseas project construction, industry-leading technical level and other advantages. Adhering to the goal of "building a world-class enterprise", the company actively participated in the "the Belt and Road" construction.

Since its establishment, China Power Construction Corporation has adhered to the strategy of "international business priority development". After years of international market development and deep cultivation of regional markets, it has gradually established a wide marketing network worldwide, with the advantages of overseas operation and layout. As of the end of 2013, the company has established 95 overseas offices in 72 countries and regions worldwide, and overseas projects under construction are distributed in 72 countries. The company's international business focuses on the field of water conservancy and hydropower as its core business, and diversified into related specialties, involving infrastructure construction fields such as water conservancy and hydropower, thermal power, power grid, transportation, housing construction, and municipal engineering. It has undertaken many landmark projects and accumulated rich experience in overseas project construction. In addition, the company has numerous engineering contracting qualifications and maintains industry-leading technical level. China Electric Power Construction represents the highest level of water conservancy and hydropower engineering construction in China, mastering the core technologies in this field; At the same time, it has reached the leading level domestically in key technologies for high-speed railway construction, shield tunneling construction control technology, and gas-fired power station construction technology; In addition, the company has a national level enterprise technology center, a special grade qualification for general contracting of water conservancy and hydropower engineering construction, a first-class qualification for engineering design in the water conservancy industry, as well as numerous first-class qualifications for highway, municipal, housing construction, port, tunnel construction, etc. Table 5 shows the qualifications possessed by China Power Construction as of 2022.

表5 截至2022年中国电建拥有的资质
编号	资质名称
1	工程设计综合甲级
2	工程勘察综合甲级
3	水利水电工程施工总承包特级
4	电力工程施工总承包特级
5	市政公用工程施工总承包特级
6	公路工程施工总承包特级
7	建筑工程施工总承包特级
8	港口与航道工程施工总承包壹级
9	矿山工程施工总承包壹级
10	石油化工工程施工总承包壹级
11	机电工程施工总承包壹级
12	河湖整治工程专业承包壹级
13	输变电工程专业承包壹级
14	机场场道工程专业承包壹级
15	桥梁工程专业承包壹级
16	隧道工程专业承包壹级
17	地质灾害治理工程甲级
18	房地产开发企业壹级
19	工程监理甲级
20	工程造价咨询企业甲级
21	房地产开发企业壹级
22	地质灾害治理工程勘察、设计、施工、监理单位甲级
23	AAA级信用企业
24	特种设备制造许可证
25	特种设备安装改造维修许可证
资料来源：中国电建网站。

Table 5 Qualifications possessed by China Power Construction Corporation as of 2022

Figure 5 shows the amount of newly signed overseas contracts by China Power Construction from 2014 to 2022 and its proportion to the total amount of newly signed contracts this year. From Figure 5, it can be seen that the overall amount of newly signed overseas contracts by the company is on the rise, with a relatively fast growth rate; From 2014 to 2020, the proportion of newly signed overseas contracts to the total amount of newly signed contracts remained around 30%, reflecting the company's active use of its operational advantages to promote the growth of overseas business scale; In 2021 and 2022, due to the impact of the epidemic, overseas business growth was lower than expected.

Figure 5: The amount of new overseas contracts signed by China Power Construction Corporation from 2014 to 2022 and its proportion to the total amount of new contracts signed this year

To sum up, in participating in the construction of the "the Belt and Road", the company gave full play to its own advantages, integrated international business resources, innovated financing models, and entered the high-end market of developed countries. New progress was made in international business transformation, investment scale and quality continued to rise, and international scale grew steadily. The company has obtained a high credit rating for global construction enterprises from three major international rating agencies. Brands such as POWERCHINA, SINOHYDRO, HYDROCHINA, SEPCO3, etc. have long been among the top in ENR rankings and have strong overseas influence.

III. Analysis on key influencing factors of POWERCHINA's participation in the "the Belt and Road" construction

（1） Adhere to the localization of international operations and enhance regional operational capabilities

The smooth integration of POWERCHINA into the construction of the "the Belt and Road" is inseparable from the implementation of its strategy of "localization of international operations". The "the Belt and Road" spans Europe, Asia and Africa. The political environment, economic development level and legal system construction of the co construction countries are different. In addition to the complex international political and economic situation, the company's international business risks are high. In addition, the company's business in the "the Belt and Road" co construction countries covers infrastructure construction such as power stations, railways, highways, ports, and municipal buildings, involving the whole industrial chain of investment and financing, consulting design, engineering construction, and operation management. There are problems such as large management range, large industry span, and high degree of specialization.

In order to solve the above problems, in 2016, China Power Construction integrated the advantages of international business resources within the group and established China Power Construction International Engineering Co., Ltd., vigorously promoting the grouping of international business, comprehensively leading and controlling the international business of all member enterprises of the group, optimizing the allocation of international resources within the group, and reducing the problem of homogeneous competition within the group. In addition, the company has established six regional headquarters in Asia Pacific, Middle East and North Africa, Southeast Africa, Central and Western Africa, Eurasia, and the Americas, tilting international business resources towards them and achieving the forward movement of management centers and business centers.

China Power Construction Corporation has taken various measures to promote the localization of international business operations in accordance with the principle of "one country, one policy". The company regards the "the Belt and Road" co construction countries as an important market for overseas investment and construction, and sets up subsidiaries in some key countries to realize the localization of capital, technology, talents, etc. At the same time, the company actively connects with the local government to explore relevant economic cooperation mechanisms and promote the scale growth of overseas business. In addition, the company actively fulfills its social responsibility and deeply integrates into the local development and construction. The construction of public infrastructure such as schools and hospitals in the local area, the employment of local residents, and the provision of relevant skills training have provided a large number of job opportunities, established good relationships with the local government, and greatly enhanced the company's visibility and brand image.

Since the implementation of international business group management and localized operation, the breadth and depth of China Power Construction's international operations have continued to expand, the business structure and management level have been continuously improved, and the operating performance has achieved rapid growth.

（2） Building an integrated whole industry chain and promoting business transformation and upgrading

The ability to integrate the whole industrial chain has enabled POWERCHINA to obtain more orders in overseas markets, making important contributions to its business growth in the "the Belt and Road" countries.

The reason why China Power Construction promotes the formation of integrated capabilities across the entire industry chain is twofold: on the one hand, it aims to drive the transformation of its business towards the mid to high end of the value chain, and on the other hand, it is due to the increased requirements for international engineering contracting business. In the early days of its establishment, China Power Construction's engineering contracting business was mainly focused on construction projects, located in the middle of the industrial chain with low added value. Overall, the business was "large but not strong", and there was a serious phenomenon of homogeneous competition within the enterprise. Internationally, due to factors such as the European debt crisis and the overall slow economic growth of developed economies in Europe and America, many engineering companies in Europe and America have returned to the Asian and African construction market. These companies have higher business strength and technological level than China Electric Power Construction. With the increasing requirements of international engineering contracting business, the company's overseas business is facing severe challenges. Promoting the integration of the industrial chain has become an urgent goal for China Electric Power Construction.

In 2014, China Power Construction Corporation began to layout the integration of the entire industry chain and officially launched a major asset restructuring work by injecting assets of hydropower and wind power survey and design business into listed companies; In 2015, the company successfully acquired eight major design institutes under its controlling shareholder, Electric Power Construction Group. In the fields of water conservancy, hydropower, and wind power, the company has formed a comprehensive industry chain that integrates surveying, design, investment, construction, and operation, greatly enhancing the company's integrated synergy effect in the industry chain of water conservancy, hydropower, and wind power. Afterwards, with the support of national policies and the unremitting efforts of the company, the company has built a complete industrial chain integrating planning, surveying, design, consulting, supervision, construction, installation, procurement, manufacturing, operation and maintenance, and energy investment, forming the core advantages of "understanding water and electricity, skilled in planning and design, long-term construction and operation, and able to invest and operate", effectively promoting the improvement of the company's resource integration ability and value creation ability.

The company takes advantage of the integration of the industrial chain, actively promotes the innovation of business models, and forms new business models such as EPC, BOT, BT, which enable the company to provide integrated and one-stop services in water conservancy and hydropower, thermal power, wind power, urban, transportation, livelihood infrastructure and other fields, enhance its competitiveness in the international market, promote the growth of the company's business scale in the "the Belt and Road", and lay a solid foundation for the company to move towards the high-end international construction market. In addition, the advantages of industrial chain integration have further consolidated the company's leading position in the hydropower industry, making important contributions to the company's development in water environment improvement and water resource utilization. In recent years, the company has continuously promoted the transformation and upgrading towards key links in the industrial chain and high-end value chain, accelerating the strategic transformation from traditional construction industry to integrated development of investment, construction and operation, and further enhancing its market competitive advantage.

In summary, the integration of the industrial chain has promoted the formation of business models such as engineering general contracting, improved the company's competitiveness in the international engineering contracting market, enabled the company to successfully sign a number of key projects, and expanded its market share overseas; On the other hand, it further consolidated the company's core advantages, expanded its business areas, optimized its industrial structure, and created new revenue growth points.

（3） Maintain risk prevention awareness and ensure the safe operation of enterprises

Participation in the construction of the "the Belt and Road" has brought not only huge development opportunities, but also considerable risks to the company. In the process of international operation, POWERCHINA has always maintained a high awareness of risk prevention, established a relatively complete risk prevention mechanism, and formulated relevant strategies for common risks such as policy risk, international operation risk, capital risk, etc., to ensure the company's participation in the "the Belt and Road" construction.

China Power Construction's main business overseas is construction engineering contracting and design. The investment and construction cycles of projects are long, and the capital investment is large. They are deeply influenced by national infrastructure investment, fiscal policies, credit policies, and other policies. When the national financial credit policies tighten, fiscal expenditures decrease, and tax policies are adjusted, it is likely to have adverse effects on the company. In response to this policy risk, China Power Construction Corporation continues to strengthen the tracking and research of national industrial policies and macroeconomic policies, and formulate response plans; While continuing to consolidate the company's market leadership position in the hydropower field, we will vigorously expand new business areas, cultivate new economic growth points, and avoid adverse effects on the company caused by changes in national policies in accordance with national strategic planning.

As the company carries out business in several co construction countries of the "the Belt and Road", the political economy, legal system, market environment, human customs, etc. of these countries are different, so the risk of international operation is high. In response to this risk, the company has strengthened its analysis of the development trends of overseas markets, and made good arrangements for overseas investment, market and country selection; At the same time, through the "one country, one policy" approach, we aim to deepen our localization in the market, optimize and expand our focus on localized companies in key countries, and create international cooperation and competitive advantages; Deeply tap the policy dividend and market dividend of the "the Belt and Road", constantly deepen traditional markets and actively expand emerging markets; In addition, the company strengthens international project management, enhances its ability to fulfill international project contracts and control costs, improves and perfects its lean project management system, reduces total factor management costs, and continuously improves its international project efficiency.

In the process of participating in the construction of the "the Belt and Road", influenced by market competition environment, business model, industry characteristics and other factors, the company's inventory, accounts receivable and unfinished construction scale have significantly expanded, and a large number of deposits, owners' monitoring funds, overseas business funds and other restricted funds are large, so the company's capital turnover is under pressure. In response to financial risks, China Power Construction Corporation has implemented a dual target mechanism of "two funds" pressure reduction, and vigorously promoted the "two funds" pressure reduction guarantee system; Comprehensively deepen budget management, use financial capacity as the boundary and red line for business and investment budgets, establish key indicators, risk red lines, and hard constraint mechanisms for budget execution; Improve the fund settlement system, increase the establishment and application of subsidiary fund pools, further enhance the centralized management level of the company's funds, improve the efficiency of fund utilization, and strengthen the prevention of fund risks.

To sum up, while the "the Belt and Road" initiative has brought unprecedented development opportunities to enterprises, it has also increased the risks faced by enterprises. China Power Construction maintains an objective attitude, rationally analyzes the potential risks of the company's operations, and takes targeted measures to address these risks, providing security guarantees for the company's overseas business development.

（1） Pay attention to international trends and prevent international operational risks

In the process of participating in the construction of the "the Belt and Road", POWERCHINA pays close attention to international business risks and has established a relatively complete risk response mechanism. In promoting the three-step global development strategy of "international business grouping, localization of international operations, and globalization of group companies", China Power Construction has solidly promoted localized operations in accordance with the principle of "implementing country specific policies", and improved its ability to respond to risks in international business.

Currently, the world is undergoing unprecedented changes that are accelerating. The trend of anti globalization is on the rise, unilateralism and protectionism are clearly on the rise, traditional and non-traditional security risks are constantly increasing, and the external environment is becoming increasingly complex. In the future, China US Spain game, sovereign debt risk of developing countries, compliance risk, overseas social security situation, Russia-Ukraine conflict, etc. will become the main factors of international business operation risk. Therefore, on the one hand, enterprises should continue to maintain a high level of attention to international trends, strengthen research and analysis of macroeconomic trends, timely identify risks and challenges brought by market changes, and take preventive measures and responses in advance; On the other hand, companies need to be more cautious in choosing overseas markets and engineering projects to reduce their operational risks.

（2） Seize the opportunity of "dual carbon" and promote the green transformation of business

In recent years, the global energy transition has entered a new stage. In response to climate change, countries have accelerated the transition of traditional fossil fuels such as coal, oil, and natural gas to green energy represented by solar photovoltaics and wind energy. In 2022, the National Development and Reform Commission issued the Opinions on Promoting the Joint Construction of the "the Belt and Road" Green Development, proposing to further promote the joint construction of the "the Belt and Road" green development, so that green can effectively become the background of the joint construction of the "the Belt and Road". In the future, the "the Belt and Road" green infrastructure, green energy, green transportation, green finance and other fields are full of development opportunities.

In this context, on the one hand, the company needs to accelerate the investment and operation of clean energy such as wind power, photovoltaic power generation, and hydropower, and focus on promoting the continuous development of its business structure towards green and low-carbon; On the other hand, actively building a green industry chain and supply chain, providing clean energy, green building materials, and low-carbon construction and operation solutions for overseas green buildings. In addition, when designing and constructing overseas projects, the green and low-carbon concept is integrated into the full lifecycle management of the project, adhering to green planning, green design, green construction, and green operation, while promoting the economic development of the host country and making positive contributions to addressing global climate change.

（3） Strengthen technological innovation and consolidate the market position of enterprises

Innovation is the primary driving force behind development. China Power Construction has innovatively formed a new international business marketing model that combines centralized marketing of the company with independent marketing of its subsidiaries, expanding the company's international marketing network; In addition, the company innovates business models, promotes the formation of EPC, BOT, BT and other business models, and promotes the increase of business scale; In addition, the company has always maintained investment in technological innovation, achieved key breakthroughs in a number of key technologies, obtained a number of technology patents, and improved the core competitiveness of the enterprise.

With a new round of scientific and technological revolution and industrial reform being further promoted, new energy storage technologies, industrial Internet, artificial intelligence and other digital and information technologies have spawned new industries, new formats and new models. The trend of marginal innovation and cross-border integration is highlighted. The global construction industry is gradually promoting industrialization, digital and intelligent upgrading. In this situation, enterprises should firmly lead by technological innovation, focus on technological breakthroughs, platform construction, achievement transformation, and talent cultivation, promote the value enhancement of the entire industry chain, and continuously improve the company's independent innovation capability and core competitiveness.

（4） Cultivate high-end talents and promote the development of overseas business

The "the Belt and Road" spans three continents of Europe, Asia and Africa and passes through hundreds of countries and regions. Their political and economic environment, human customs, legal systems, market standards, etc. are different, which puts forward high requirements for the management level of enterprises. In addition, due to the increase in labor costs and further intensified market competition, the profit margins of labor-intensive engineering contracting projects are being squeezed more, and the technological content of projects is gradually becoming an important standard for international engineering contracting. Whether it is improving management level or strengthening technological innovation, it cannot be separated from the cultivation of high-end talents. In addition, with the continuous promotion of digital management, business digitization, product digitization, and digital industrialization by China Power Construction in recent years, its demand for digital talents has greatly increased.

Therefore, enterprises must firmly implement the strategy of strengthening the enterprise through talent, strengthen the concept of people-oriented and respecting talents, increase the training efforts for scientific and technological talents, international talents, compound talents, and innovative talents, continuously optimize training management, and build a talent highland. At the same time, enterprises should further improve the talent incentive mechanism centered on value creation, implement differentiated compensation, establish incentive mechanisms that match multiple factors such as position, performance, and ability, fully tap into the subjective initiative of talents, and promote the transformation and upgrading of the company's business.