On 14 May, Yuan Linjiang, the Chairman of China Re Group, attended Belt and Road Forum for International Cooperation and accepted interview of People’s Daily Online. The press release of the interview was published on a prominent part of People’s Daily Online and received wide attention.
During the interview, Yuan Linjiang reviewed China Re Group’s important measures of providing reinsurance service for “Belt and Road” construction and analyzed various challenges and unprecedented opportunities under the new situation. He expressed that China Re Group has established direct or indirect reinsurance business relationships with over 1000 insurance companies, reinsurance companies and brokerage companies in over 100 countries and regions in the world. Recently, it provides risk protection of approximately RMB60 billion for “Belt and Road” each year in average. “Belt and Road” construction brings a broad platform for further development and expansion of the insurance industry in China. China Re Group will explore into the establishment of the community of insurance and reinsurance for “Belt and Road” to actively meet the risk protection demand from China interested projects and projects of Chinese enterprises along with “Belt and Road”.
Below is the press release of the interview:
Yuan Linjiang, Chairman of China Re Group, Talks about China Reinsurance Assisting “Belt and Road”
From People’s Daily Online in Beijing dated 14 May (Zhang Wenting). On 14-15 May, the recognizable Belt and Road Forum for International Cooperation was held in Beijing. With further intensification of “Belt and Road” proposals, Chinese enterprises’ enthusiasm of “going global” continued to rise. However, geopolitical risks and political and personnel risk bring challenges for Chinese enterprises participating in “Belt and Road” construction. In this regard, Yuan Linjiang, the Chairman of China Reinsurance (Group) Corporation stated in the interview on People’s Daily Online that “Belt and Road” proposals brought both challenges and opportunities to the national insurance industry, with greater opportunities than challenges. “Currently, Chinese insurance companies’ capabilities in technology and services for supporting ‘Belt and Road’ construction have to be enhanced in general. The presence of overseas institutions has yet to be improved. Chinese insurance companies must group together for expansion abroad,” he said.
Yuan Linjiang further explained that the reason why there were greater opportunities than challenges mainly involved two aspects. On the one hand, it is related to the existing market. Chinese insurance institutions are not competitive in the existing market that those are to be insured are insured. According to China Re Group’s estimates, in the insurance businesses involved in “going global” of Chinese enterprises, Chinese insurance enterprises account for less than 10% and substantially most of the business are underwritten by a few international insurance institutions. Therefore, state-owned enterprises have to work hard and bear more responsibilities. On the other hand, it is related to the incremental market. The risk management concepts of Chinese enterprises “going global” are not yet mature. With reference to mature market experience, it is estimated that over half of the risks are still exposed and not protected by insurance. Hence, the incremental market for those are to be insured are not yet insured has larger room for development. It is a huge piece of cake with rapid growth.
Referring to China Re’s presence in “Belt and Road” proposals, Yuan Linjiang stated that as the only state-owned reinsurance group, China Re was the reinsurance company with the earliest international development and the highest internationalization level. In 2016, China Re provided risk protection of RMB2 trillion for the international market.
In the future, the Company will continue its overseas presence, increase product R&D investment and create security network. Yuan Linjiang illustrated with examples. The security issue of overseas workers has always been the largest concern of enterprises “going global”. In this regard, on 12 May, China Re entered into a strategic cooperation agreement with China Security Community to create an overseas assisting system with the feature of “China Insurance + China Security”, aiming to provide overseas workers of Chinese enterprises with more reliable and comprehensive security.
According to Yuan Linjiang, with the support and leadership of CIRC and shareholders, China Re is promoting the establishment of the international insurance and reinsurance community for “Belt and Road”. It is planned to complete full coverage of insurance services network for countries along with “Belt and Road” during the year. Currently, nearly half of it has completed and memorandums of cooperation were signed with relevant countries.
(Link of the interview video clip: http://tv.people.com.cn/n1/2017/0515/c177969-29276401.html)