CCCC Yangtze River Construction Headquarters

Against the backdrop of dual drivers—national strategy and regional development—deep cooperation between central enterprises and local enterprises is becoming a key force driving high-quality economic development. Among them, the restructuring and establishment of CCCC Yangtze River Construction Development Group Co., Ltd. (hereinafter referred to as "CCCC Yangtze River Construction") is undoubtedly a major innovation and breakthrough in the field of central-local cooperation. This article provides a comprehensive analysis of this exemplary case of central-local cooperation from three aspects: the project overview of CCCC Yangtze River Construction, its strategic positioning and significance, and the cooperation process and future prospects.

01

Project Overview:

Central and Local Hands Joined to Build a New Chapter in Water Conservancy

CCCC Yangtze River Construction Development Group Co., Ltd., with a registered capital of as much as 2.676 billion yuan, is jointly held by China Communications Construction Group Co., Ltd. (hereinafter referred to as "CCCC Group") and Chongqing Water Investment Group, marking the deep integration of central-local cooperation in fields such as water conservancy and hydropower, infrastructure, and ecological environmental protection.

This newly established company, based in the southwestern region, is an important measure taken by CCCC Group to actively respond to the national call for water conservancy reform and implement the water governance approach of "prioritizing water conservation, balancing spatial distribution, systematic governance, and leveraging both government and market forces."

On this land full of vitality in Chongqing, CCCC Yangtze River Construction is leveraging its unique advantage of "integrated navigation and hydropower across the entire water sector" to promote the implementation of multiple landmark water conservancy and municipal projects, contributing to Chongqing's construction of a modern water network and the establishment of a sustainable modern water conservancy engineering system.

02

Strategic Significance:

Innovation-Driven, Jointly Pursuing a New Blueprint for Development

The establishment of CCCC Yangtze River Construction is not only an important practice of central-local cooperation but also a vivid embodiment of the innovation-driven development strategy. Its strategic significance is far-reaching and is mainly reflected in the following aspects:

(1) Aligning with the direction of national strategy and regional development strategy

The establishment of CCCC Yangtze River Construction closely aligns with the overall national strategy for water conservancy reform and accelerated water conservancy development, and is also highly consistent with national regional development strategies such as the Belt and Road Initiative, the Yangtze River Economic Belt, the Large-Scale Development of the West, and the construction of the Chengdu-Chongqing economic circle. As a model of a state-owned central enterprise, CCCC Yangtze River Construction will firmly fulfill its national mission, take high-quality service to national strategy as its responsibility, and inject strong momentum into the implementation of major national projects and the development of local economies and culture.

(2) Promoting the optimization of the layout of the state-owned economy and structural adjustment

As the only pilot unit for a state-owned capital investment company in the construction industry, CCCC Group shoulders the historical mission of serving as a platform for the entry, exit, retention, transfer, and structural adjustment of state-owned capital. Chongqing Water Investment, meanwhile, has a deep understanding of and rich experience in Chongqing's water conservancy market. The two sides have joined forces, focusing on the three core business segments of water conservancy and hydropower, infrastructure, and ecological environmental protection, carefully laying out and strengthening and extending the industrial chain, and are committed to building a large infrastructure business system that "prospers by water and thrives with cities." In the subdivided fields of the three major segments—water-related business, urban business, and green business—CCCC Yangtze River Construction has positioned itself precisely, establishing reservoir and water supply projects and comprehensive urban development as pillar businesses; treating flood control projects, farmland water conservancy projects, distinctive real estate and urban renewal, and new infrastructure as strategic businesses; and positioning hydropower projects, soil and water conservation projects and environmental water conservancy projects, and asset operation and ecological environmental protection as synergistic businesses. Through the precise layout and coordinated development of the three major segments and three major fields, CCCCC Yangtze River Construction will comprehensively enhance the company's overall competitiveness and market influence, becoming a leading operator across the entire life cycle of the water conservancy industry, an all-round service provider in the urban development industrial chain, and an outstanding general contractor in the field of engineering construction.

(3) Promoting the industrial chain layout of central enterprises and local economic development

For CCCC Group, the establishment of CCCC Yangtze River Construction will greatly accelerate the aggregation of relevant advantageous resources, strengthen CCCC Group's industrial chain in subdivided fields such as water conservancy engineering survey and design, construction and building, consulting and supervision, and market operation, and enhance its integrated service capability in the "entire water sector." This will not only further consolidate CCCC Group's leading position in the field of water-related engineering but will also help give play to the strategic support role of state-owned central enterprises for the country and contribute more to national water conservancy reform and development.

For the local economy, the establishment of CCCC Yangtze River Construction will greatly assist Chongqing in building a modern water network and promoting the establishment of a sustainable modern water conservancy engineering system. By strengthening investment and construction in water conservancy and transportation infrastructure in Chongqing and the southwestern region, CCCC Yangtze River Construction will play an important role in achieving local GDP growth targets and stabilizing employment. In addition, CCCC Yangtze River Construction will actively participate in the implementation of major national strategies such as the construction of the Chengdu-Chongqing economic circle, the Large-Scale Development of the West in the New Era, the development of the Yangtze River Economic Belt, and the construction of the New International Land-Sea Trade Corridor in the West, injecting new vitality and momentum into the sustained and healthy development of the local economy.

(4) Distinct characteristics of central-local cooperation and innovative cooperation model

The establishment of CCCC Yangtze River Construction has distinct characteristics of central-local cooperation. CCCC Group directly holds 51%, CCCC Investment holds 23.73%, and Chongqing Water Investment holds 25.27%. The shareholding structure is clear and reasonable, reflecting the deep mutual trust and close cooperation between the central and local parties. In terms of the cooperation model, CCCC Yangtze River Construction has achieved innovative breakthroughs. By contributing the three professionally qualified companies of Chongqing Water Investment—the Hydropower Survey and Design Institute, Shuifa Company, and Hongyu Company—as capital contributions, and injecting them into CCCC Chongqing Investment through capital increase and share expansion, while simultaneously adjusting CCCC Chongqing Investment at the equity and management levels into a second-tier company directly managed by CCCC Group. This innovative cooperation model not only enabled CCCC Yangtze River Construction to obtain key qualifications such as Grade A qualification for design in the water conservancy industry, Grade I qualification for general contracting of building engineering construction, and Grade I qualification for general contracting of municipal public works construction, but also achieved the improvement and strengthening of the industrial chain within professional subdivided fields. This cooperation model is neither the conventional path of direct investment by traditional central enterprises in local areas nor a simple merger and acquisition model; rather, it marks an important innovative exploration and practice of central-local equity cooperation.

03

Future Prospects:

Moving Forward Hand in Hand to Create a Brilliant Future Together

Since January 2023, the establishment process of CCCC Yangtze River Construction has advanced steadily. In May 2023, the Chongqing Municipal Government and CCCC Group formally signed a framework agreement on promoting central-local cooperation, marking the entry of bilateral cooperation into a substantive stage. In December 2023, CCCC Group, its subsidiary CCCC Investment Co., Ltd., and Chongqing Water Investment Group signed the "Capital Increase and Share Expansion Agreement of CCCC Chongqing Investment Development Co., Ltd.," laying a solid foundation for the establishment of CCCC Yangtze River Construction. In January 2024, the establishment ceremony of CCCC Yangtze River Construction Development Group Co., Ltd. was grandly held in Chongqing, marking the official launch of this model of central-local cooperation.

Looking ahead, CCCC Yangtze River Construction will continue to uphold the development philosophy of "innovation, coordination, greenness, openness, and sharing," take high-quality service to national strategy as its responsibility, and aim to build an industry-leading, world-class industrial group featuring "integrated investment, construction, and operation" in the fields of water conservancy and hydropower and urban infrastructure, continuously promoting the improvement and strengthening of the industrial chain and enhancing the company's overall competitiveness and market influence. At the same time, CCCC Yangtze River Construction will also actively participate in local economic and social development and contribute to the sustained and healthy development of Chongqing and the southwestern region.