Mainland railway firm eyes US project

CRCC is negotiating to build retirement community in Nevada costing US$700 million

PUBLISHED : Saturday, 03 November, 2012, 12:00am
UPDATED : Saturday, 03 November, 2012, 3:22am

Despite the China-bashing in the United States presidential election, which has entered its final week, a Chinese state-owned enterprise is in talks to win a US infrastructure project worth at least US$700 million.

A subsidiary of China Railway Construction Corp is talking to a US company on building a retirement community in Nevada, said Yu Xingxi, the finance and accounting manager of the Shanghai and Hong Kong-listed firm.

If CRCC wins a contract, it must be worth at least US$700 million to US$800 million, said Yu. "We won't look at projects smaller than that. We seek opportunities all around the world, but only a few of them materialise."

He said the talks were at a preliminary stage and no deal had been struck. He declined to name the US firm or Nevada project.

Clarifying media reports that CRCC was seeking Chinese bank loans to finance the project, Yu said it was the US project owner that was seeking loans. Having Chinese banks finance the Nevada retirement community while CRCC built it was a possible option, he said.

In September, Nevada governor Brian Sandoval visited China and South Korea to boost economic ties between his state and the two Asian nations, the first Nevada trade delegation to China since the 1980s, the Las Vegas Review Journal reported.

Yu said that in the meantime, "the potential US project we're focusing on is the California high-speed rail". But he added that there would be no deals in the short term.

The first phase of the high-speed rail project, the most expensive in the US, will begin operation in 2018 at a cost of US$68.4 billion, according to the California High-Speed Rail Authority.

In June, China Construction America won a US$104.2 million contract to build the Shore (Belt) Parkway Bridge in New York City, the company said on its website.

The firm is wholly owned by China State Construction Engineering Corp, a state-owned construction giant listed in Shanghai.

The US election has seen both President Barack Obama and his rival Mitt Romney criticise China for its economic practices towards the US. Yet, Chinese investments in the US reached a record US$6.3 billion in the first three quarters of this year, nearly double all of last year, said Thilo Hanemann in a report of Rhodium Group, a US market research firm.

"The deal pipeline is strong, with major pending acquisitions in aviation, auto parts and energy, but the increasingly heated public debate in the US is aggravating existing tensions in the US-China investment relationship," Hanemann said.