China to sign telecom, energy deals with Portugal


AFP

LISBON — Chinese President Hu Jintao wraps up a two-day visit to Portugal Sunday with talks with Portuguese Prime Minister Jose Socrates to seal a raft of deals in telecommunications, renewable energies, banking and food. The visit to the economically fragile country, which hopes the trade deals with Beijing will alleviate market pressure on its debt, follows a state visit to France earlier in the week. Hu told Portuguese President Anibal Cavaco Silva on Saturday he wanted to see the two sides shore up economic cooperation and try to double bilateral trade by 2015, China’s official Xinhua news agency quoted him as saying. China was ready to explore with Lisbon ways to upgrade China’s economy and trade, Hu added. Among the deals to be signed by the two leaders, Industrial and Commercial Bank of China (ICBC), one of China’s “Big Four” national banks, was expected to take a 10 percent stake in BCP, Portugal’s largest private lender. Electricity firm EDP was due to sign an agreement with China Power International Holding on co-operation in renewable energy and projects in Asia, Europea, Africa and Brasil, Lusa news agency reported. Talks were ongoing over China acquiring a stake in EDP, with the Portuguese government seeking to reduce its 25 percent holding as part of plans to scale back its huge debt, the report said. Another deal was expected to involve Portugal Telecom, the country’s main telecommunications company, but the nature of the deal was not immediately known. Analysts have said they expect Beijing to announce, as it did last month for Greece, its willingness to buy up Portuguese debt, which has been buffeted on the bond markets. Some Portuguese media were, however, unimpressed by the first day of the visit with the Jornal de Noticias saying it had so far achieved “nothing notable on concrete matters.” “The hypothesis that China buys Portuguese debt is not yet clear and assurances on the negotiations going on in relation to Portuguese farming, banking and energy remain vague.”

Newspapers also noted the complete absence of the issue of human rights from the dialogue. Earlier Hu said China wanted to strengthen cooperation with Portugal on international issues such as reform of the United Nations. “Thus we will be able to consolidate our consultations on global themes and common international interest, such as the resumption of world economic growth, the reform of the United Nations and climate change,” Hu said at a joint news conference with Cavaco Silva. Cavaco Silva said that the election of Portugal to the one of the non-permanent seats on the Security Council opened “new possibilities of deepened dialogue between the two countries.” Portugal ranks 77th on the list of China’s suppliers, with goods worth 222 million euros (US$310 million) exported last year, and imports worth 1.1 billion euros. Hu arrived here Saturday with his wife Liu Yongqing, members of the Chinese government and around 50 business leaders. Liu on Sunday visited Sao Jorge castle, which dominates the centre of Lisbon, as well as the Belem Tower, the starting point for the great voyages by 15th and 16th century Portugese navigators. Hu flew in direct from his visit to France, where Chinese officials had signed more than US$20 billion in contracts with French firms. Despite the parliament approving swingeing budget cuts of five billion euros (US$7 billion) last week, the yield — the rate of return for investors — on the benchmark Portuguese 10-year bonds jumped to a record 6.439 percent on Thursday.