UK and Chinese re/insurance companies are anticipating further cooperation as the countries look set to deepen their coordination on projects under the Belt and Road Initiative (BRI), according to Xinhua Net.
Proposed by Chinese President Xi Jinping in 2013, the BRI aims to build a new platform for international cooperation by achieving policy, infrastructure, trade, and financial connectivity along the ancient Silk Road trade routes.
Catherine McGuiness, Chairman of the Policy and Resources Committee for the City of London, said that London was a “natural partner” for the BRI and had a lot to offer China in terms of assessing project risks and insurance.
In insurance specifically, she said the London market was “a leader in innovative product development and has historically embraced insuring new risks,” pointing to examples such as The Joint Code of Practice for Risk Management of Tunnel Works and private market political risk insurance.
Over 100 countries have already pledged their support to the BRI, and more than 80 countries and international organisations have signed cooperation agreements with China, according to Xinhua.
Inga Beale, Chief Executive Officer (CEO) of Lloyd’s of London, agreed that insurance would help build resilience in projects under the initiative, stating that Lloyd’s would stand ready to support the BRI by providing re/insurance products and expert knowledge.
She added that China is one of Lloyd’s most important markets, and that participation in the BRI would allow it to collaborate with Chinese companies on pioneering new forms of protection for a rapidly changing world.
Yuan Linjiang, Chairman of China Re, stressed that insurance and risk assessment were particularly important given the complexity of political, economic and cultural situations in countries along the BRI.
He asserted that insurance and reinsurance were the best ways to divert and minimise the risks of projects and called for the establishment of a joint insurance mechanism to deflect major risks from single companies who may not be able to bear the risks of larger projects alone.
Earlier this year at the China-UK Economic and Financial Dialogue (EFD), the two countries proposed a bilateral investment fund to support the BRI, with the first round valued at US $1 billion.
Additionally, the UK government pledged up to £25 billion in financial support to companies participating in BRI projects in Asia in a bid to support involvement.
