Etiquette is an important part of international business development. It is especially important in some countries where the entire social (etiquette) business relationship drives the final outcome. China is perhaps one of the more strict followers of its defined business etiquette and hangs many decisions and approvals on it. Although the process may appear cumbersome at times, it is nonetheless a necessary and important part of long-term strategy. A company that can incorporate the needed “niceties” into their development plans in China will have a solid beginning and a new road to large potential profits.
Welwind International Corp., an international wind energy developer and operator, works to develop international wind energy projects at all levels of participation. The company is currently working with commercial, provincial and central government partners in China to develop two 800 megawatt potential wind farms.
Although the company is relatively new to the wind energy business, it has been making remarkable progress in its negotiations with Chinese companies, provincial entities and central governmental officials. Since its beginnings in 2006, the company has progressed to a definitive Power Perchance Agreement (PPA) with Ningxia Power Corp. This agreement involves a 49% joint venture stake in Ningxia Power’s currently producing 49.5-megawatt wind farm. The same stake is applicable to the entire project as it reaches its full potential build-out of 400 megawatts. The PPA for the company has been dated August 5, 2008 at $USD0.08 KWH from the provincial development authority.
The company fully intends to develop additional international wind farm opportunities as they become appropriate to the company’s business model. Its involvement with Ningxia Power, however, has given it a solid “in” with a leading company in China. In social terms, this aspect of the company’s overall business plan does dictate that it further develop the relationship to its full business and political potential.
The company currently has a similar Chinese wind energy project in development and sees its relationship with a $300-million company, which is part of the Ningxia Hui Autonomous Regional Government, as one that deserves solid respect and attention, not to mention the potential access to large ponds of usable capital. The company’s initial agreement involves providing turbine technology, management and construction for its 49% stake, which should show the commitment that Chinese business and political leaders appreciate. As the company moves forward, this solid first step is a good one in its developing of an international windpower presence.
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