china everbright limited’s ceo chen shuang attends the 5th china air finance development (dftp) summit and as a keynote speaker
mr. chen shuang, executive director and chief executive officer of china everbright limited (“cel”, stock code: 165.hk), recently delivered a speech at the 5th china air finance development (dongjiang free trade port zone or “dftp”) summit held on 22 september in tianjin. during his speech, mr chen said dongjiang has become the architect, advocate and leader of the growth of china’s aircraft leasing industry, as well as a systems and value creation hub that unceasingly promotes policy innovation in aircraft leasing. he added that he believes dongjiang will continue to steer the future growth of china’s aviation finance sector.
full text of mr chen shuang’s speech as below.
good morning, honoured guests, ladies, and gentlemen.
on this beautiful autumn day in tianjin, i am very honoured to be here at the 5th china air finance development (dftp) summit, and it is a great pleasure to see both old and new industry friends. the topic that i will share with you today is “working with dongjiang to drive the comprehensive development of china’s aviation finance market”. actually, i wanted to talk about how dongjiang is an architect, advocate and leader of the growth of china’s aircraft leasing industry, but i will skip this part because mr zhang has just given a very detailed description of the dongjiang free trade port zone’s operations, policies and legal framework in relation to aircraft leasing. dongjiang has become an architect, advocate and leader of the growth of china’s aircraft leasing industry, as well as a systems and value creation hub that unceasingly promotes policy innovation in aircraft leasing. we believe dongjiang will continue to steer the future growth of china’s air finance. so, i will keep this brief.
how should china’s aircraft leasing industry leverage dongjiang’s growth in the financial sector?
the vision for china’s aircraft leasing industry is to effectively combine finance and operations. in 2011 cel invested in china aircraft leasing group holdings (‘calc’) and has been jointly worked with friedmann pacific for the company’s further development. the key element for the simultaneous development of both the business and finance segments was already embedded in the company’s dna. strong interactions ensued, given calc’s policy alignment with dongjiang. over the last six years, the dongjiang free trade port zone has initiated various schemes and created the best policy environment for aircraft leasing in china. for our part, calc has leveraged its global outlook and professional experience to create a win-win situation for both sides.
in 2010, calc landed on tianjin’s dongjiang free trade port zone, becoming the first foreign aircraft leasing company in the province. to date, we have delivered over 50 aircraft throughout dongjiang.
in 2011, calc completed the first operating aircraft leasing transaction in the dongjiang free trade port zone. in the same year, we achieved a breakthrough with the customs, completing the first customs transit in tianjin.
in 2012, we introduced the first twin-aisle plane to dongjiang. in the same year, we became the first standalone company to complete the application for the maximum limit of us dollar foreign debt with the national development and reform commission.
in 2013, we founded a company upon the establishment of a project to share the foreign debt limit with the parent company.
in 2014, we became the first aircraft leasing company in china to undergo asset securitisation. in fact, this asset securitisation in 2014 laid the foundation for calc to successfully list in hong kong, making it the first aircraft leasing company listed in the hong kong’s capital market.
in 2015, we became the first company in the tianjin free-trade zone to be granted approval to carry out a foreign currency capital pool pilot scheme, which led to our successful creation of a foreign currency capital pool. this was important to the long-term development of china’s aircraft leasing industry.
in addition, on 20 july 2015 calc issued its first batch of medium-term notes, becoming the first aircraft leasing company in china and the first company in the tianjin free-trade zone to do so. this year, we received an aa credit rating from china chengxin, and calc’s financing costs have fallen by one percentage point every year for the last four years, from 6% to 3%. this lowering of financing costs has been a very important development for calc in recent years. we also hope to establish industry benchmarks with the dongjiang free trade port zone so as to promote the development of the financial segment.
let me give you a brief update of calc’s development. calc has achieved long-term, substantial growth in bountiful dongjiang. over the years, we have also implemented strategies to professionalise, diversify and internationalise. calc’s strategic goals are twofold: (1) providing a full value chain aircraft solution, and (2) globalisation. based on these two major development strategies, we have done four things:
1. provide complete, full-lifecycle value chain services for aircraft, centred around airline customers
we provide services from an aircraft’s initial purchase all the way to its final stage of disassembly. we hope to complete construction work on our disassembly base in heilongjiang to support the dismantling of our first aircraft in the first half of next year.
2. provide excellent aviation products for aviation finance institutions
this year, the number of our planes under aircraft leasing securitisation may exceed 20. this has been a substantial long-term development ever since we securitised our very first aircraft with china taiping insurance. basically, we have securitised a considerable portion of accounts receivable. this is a major breakthrough for us, and it satisfies a need for financial assets to meet china’s asset shortage. it has also thrown an important lifeline to the aircraft leasing industry.
3. provide added value to china’s air transport industry
this is something the aircraft industry needs to expand in the future.
4. create a marketing outlet for china’s aircraft manufacturing industry
we signed an agreement with arj to purchase 60 aircraft this year. in the area of globalisation, we will also help china’s commercial aviation industry venture overseas. in this respect, it is a huge advantage for chinese commercial aviation to be based in hong kong. the goal for china’s commercial aviation industry is to increase its number of planes to 72 in 2015 and 1,173 by 2020. these are basically in our orders and agreements, and they are definite numbers that will only go up, not down. i mentioned just now that our aircraft disassembly base is going to be completed very soon. i will not mention it again here. in terms of internationalisation, we have expanded to macau, turkey, india and vietnam, and this year we will start operations in japan. we have achieved fast-growing internationalisation for our aircraft leasing business. currently, we have orders for almost 20 aircraft. we have delivered planes to macau, turkey, india and vietnam.
in short, calc has seen very rapid growth in the last few years because of dongjiang. what mr zhang said just now underscores that tax advantages are not the only reason why calc has chosen to focus on dongjiang for its expansion. more importantly, dongjiang has the professional advantage in air finance. you can see dongjiang’s efforts being put into professionalising, diversifying and internationalising air finance. for our part, we are willing to continue relying on dongjiang and making our own contribution to the global aviation value chain. thank you!
full text of mr chen shuang’s speech as below.
good morning, honoured guests, ladies, and gentlemen.
on this beautiful autumn day in tianjin, i am very honoured to be here at the 5th china air finance development (dftp) summit, and it is a great pleasure to see both old and new industry friends. the topic that i will share with you today is “working with dongjiang to drive the comprehensive development of china’s aviation finance market”. actually, i wanted to talk about how dongjiang is an architect, advocate and leader of the growth of china’s aircraft leasing industry, but i will skip this part because mr zhang has just given a very detailed description of the dongjiang free trade port zone’s operations, policies and legal framework in relation to aircraft leasing. dongjiang has become an architect, advocate and leader of the growth of china’s aircraft leasing industry, as well as a systems and value creation hub that unceasingly promotes policy innovation in aircraft leasing. we believe dongjiang will continue to steer the future growth of china’s air finance. so, i will keep this brief.
how should china’s aircraft leasing industry leverage dongjiang’s growth in the financial sector?
the vision for china’s aircraft leasing industry is to effectively combine finance and operations. in 2011 cel invested in china aircraft leasing group holdings (‘calc’) and has been jointly worked with friedmann pacific for the company’s further development. the key element for the simultaneous development of both the business and finance segments was already embedded in the company’s dna. strong interactions ensued, given calc’s policy alignment with dongjiang. over the last six years, the dongjiang free trade port zone has initiated various schemes and created the best policy environment for aircraft leasing in china. for our part, calc has leveraged its global outlook and professional experience to create a win-win situation for both sides.
in 2010, calc landed on tianjin’s dongjiang free trade port zone, becoming the first foreign aircraft leasing company in the province. to date, we have delivered over 50 aircraft throughout dongjiang.
in 2011, calc completed the first operating aircraft leasing transaction in the dongjiang free trade port zone. in the same year, we achieved a breakthrough with the customs, completing the first customs transit in tianjin.
in 2012, we introduced the first twin-aisle plane to dongjiang. in the same year, we became the first standalone company to complete the application for the maximum limit of us dollar foreign debt with the national development and reform commission.
in 2013, we founded a company upon the establishment of a project to share the foreign debt limit with the parent company.
in 2014, we became the first aircraft leasing company in china to undergo asset securitisation. in fact, this asset securitisation in 2014 laid the foundation for calc to successfully list in hong kong, making it the first aircraft leasing company listed in the hong kong’s capital market.
in 2015, we became the first company in the tianjin free-trade zone to be granted approval to carry out a foreign currency capital pool pilot scheme, which led to our successful creation of a foreign currency capital pool. this was important to the long-term development of china’s aircraft leasing industry.
in addition, on 20 july 2015 calc issued its first batch of medium-term notes, becoming the first aircraft leasing company in china and the first company in the tianjin free-trade zone to do so. this year, we received an aa credit rating from china chengxin, and calc’s financing costs have fallen by one percentage point every year for the last four years, from 6% to 3%. this lowering of financing costs has been a very important development for calc in recent years. we also hope to establish industry benchmarks with the dongjiang free trade port zone so as to promote the development of the financial segment.
let me give you a brief update of calc’s development. calc has achieved long-term, substantial growth in bountiful dongjiang. over the years, we have also implemented strategies to professionalise, diversify and internationalise. calc’s strategic goals are twofold: (1) providing a full value chain aircraft solution, and (2) globalisation. based on these two major development strategies, we have done four things:
1. provide complete, full-lifecycle value chain services for aircraft, centred around airline customers
we provide services from an aircraft’s initial purchase all the way to its final stage of disassembly. we hope to complete construction work on our disassembly base in heilongjiang to support the dismantling of our first aircraft in the first half of next year.
2. provide excellent aviation products for aviation finance institutions
this year, the number of our planes under aircraft leasing securitisation may exceed 20. this has been a substantial long-term development ever since we securitised our very first aircraft with china taiping insurance. basically, we have securitised a considerable portion of accounts receivable. this is a major breakthrough for us, and it satisfies a need for financial assets to meet china’s asset shortage. it has also thrown an important lifeline to the aircraft leasing industry.
3. provide added value to china’s air transport industry
this is something the aircraft industry needs to expand in the future.
4. create a marketing outlet for china’s aircraft manufacturing industry
we signed an agreement with arj to purchase 60 aircraft this year. in the area of globalisation, we will also help china’s commercial aviation industry venture overseas. in this respect, it is a huge advantage for chinese commercial aviation to be based in hong kong. the goal for china’s commercial aviation industry is to increase its number of planes to 72 in 2015 and 1,173 by 2020. these are basically in our orders and agreements, and they are definite numbers that will only go up, not down. i mentioned just now that our aircraft disassembly base is going to be completed very soon. i will not mention it again here. in terms of internationalisation, we have expanded to macau, turkey, india and vietnam, and this year we will start operations in japan. we have achieved fast-growing internationalisation for our aircraft leasing business. currently, we have orders for almost 20 aircraft. we have delivered planes to macau, turkey, india and vietnam.
in short, calc has seen very rapid growth in the last few years because of dongjiang. what mr zhang said just now underscores that tax advantages are not the only reason why calc has chosen to focus on dongjiang for its expansion. more importantly, dongjiang has the professional advantage in air finance. you can see dongjiang’s efforts being put into professionalising, diversifying and internationalising air finance. for our part, we are willing to continue relying on dongjiang and making our own contribution to the global aviation value chain. thank you!