INVESTMENT OVERVIEW

One Belt and One Road

In 2013, President Xi Jinping of the People’s Republic of China proposed two new international trade routes – the New Silk Road Economic Belt and the New Maritime Silk Road – that would connect China with European, Middle Eastern and other Asian countries. This modern equivalent of the great Silk Road – established more than 2,100 years ago during the Han Dynasty by the imperial envoy Zhang Qian – calls for the creation of a vast network of roads, railroads and the attendant supportive utility infrastructure.

This grand initiative, known as One Belt and One Road (OBOR), has attracted the interest of 68 countries with a combined GDP of US$21 trillion and an aggregate population of over 4 billion. President Xi “aims to create the world’s largest platform for economic cooperation, including policy coordination, trade and financing collaboration, and social and cultural cooperation.”1 OBOR is considered to be a watershed event in President Xi’s term as China’s leader, “the clearest expression so far of Mr. Xi’s determination to break with Deng Xiaoping’s dictum to ‘hide our capabilities and bide our time; never try to take the lead.’ ”2 In a February 2016 report, PricewaterhouseCoopers estimated that OBOR will result in “up to US$1 trillion of outbound state financing from the Chinese government in the next 10 years.” At a forum in Beijing hosted by President Xi in May 2017, he pledged US$124 billion toward OBOR. Additionally, Chinese companies have been making significant investments in countries involved in OBOR, with 175 acquisitions totaling US$31 billion in 2016 and 109 deals valued at US$33 billion in 2017 (through August 14), according to data from Thomson Reuters cited by Fortune.3

Wuhan Yangtze River Newport Logistics Center–in the Hubei Free Trade Zone

Yangtze River Development(NASDAQ: YERR), through its wholly owned Wuhan Newport unit, primarily engages in the business of real estate and infrastructural development with a port logistics center located in Wuhan, the capital city of Hubei Province in China. Situated in the middle reaches of the Yangtze River, Wuhan Newport is a large infrastructure development project implemented under OBOR. Wuhan Newport is strategically positioned in the recently announced Hubei Free Trade Zone, part of the third wave of Free Trade Zones authorized by the Chinese government which offer companies a favorable tax rate and duty free warehousing of imported goods. There are now 11 Free Trade Zones in China.

Favorable Regulatory Environment Attracts American Investment

While Chinese regulators have been increasing their scrutiny of cross-border transactions, “companies enjoy a relatively smooth approval process for deals along [OBOR] as regulators tend to put them in a different basket when reviewing outbound investments, according to lawyers and dealmakers. ‘If you are doing One Belt, One Road, that becomes the first sentence in the document’ to the regulators, said a senior advisor at a Chinese company that has acquired several overseas businesses.”4

General Electric sold US$2.3 billion of equipment to Chinese construction and engineering companies to install in the OBOR region, up from just US$400 million in 2014, and will bid for an additional US$7.0 billion in orders for natural-gas turbines and other power equipment over the next 18 months. GE has even reorganized its marketing staff for global power equipment to give Chinese orders priority. Rachel Duan, CEO of General Electric China, said, “We have a laser focus on winning these… When the roads are built, when the ports are built, when the power plants are built, I think the other opportunities will come.”5

Sources of Revenue

The Wuhan Yangtze River Newport Logistics Center will have six operating zones encompassing port operations, warehouse and distribution, cold chain logistics, rail cargo loading, exhibition space and business activities. The Company anticipates that it will derive revenue primarily from operations of Wuhan Newport, commercial leases and opportunistic sales of property.

Year-to-Date Stock Performance

Management

Xiangyao Liu, President, CEO, Secretary and Chairman of the Board. Mr. Liu has over 20 years of experience in steel and other logistics trading. He supervised the transition of the Wuhan Huazhong Steel Trading Center into Wuhan Yangtze River Newport Logistics, led projects to bring the Steel Trading Center into the Yangluo Comprehensive Bonded Zone and Free Trade Area in Wuhan, supervised the feasibility study of the Wuhan Yangtze River Newport Logistics Center and collaborated with the local government to develop the Yangluo Newport Project Plan. Mr. Liu was appointed as CEO and the Chairman of the Board of the Company in July 2015. He received his Bachelor’s degree in Business Management from the Hebei Institute of Finance in 1994.

Tsz-Kit “Jerry” Chan, Chief Financial Officer. Mr. Chan has served as CFO since May 2017. He has a proven track record in corporate governance and the US financial reporting. He was the Chief Financial Officer of QKL Stores Inc, a company listed on the NASDAQ Exchange, during the period from 2010 to 2016. Mr. Chan holds a Master of Business Administration from the Chinese University of Hong Kong. He is a certified public accountant in Hong Kong, and also a member of the American Institute of Certified Public Accountants.

James Stuart Coleman, Director. Mr. Coleman has been the Chief Representative in the U.S. for Wuhan Yangtze River Newport Logistics since April 2015. He has also been the CEO and CFO of Dream Recovery International, a drug and alcohol rehabilitation facility, since January 2014. Mr. Coleman has also been a Partner of Angel Capital since September 2012. Since April 2006, Mr. Coleman has served as an Associate Broker at Bond New York Properties, specializing in commercial real estate. He received his Bachelor’s degree in History from Allegheny College in 1978.


1 Tian Jinchen. “One Belt and One Road: Connecting China and the World.” McKinsey & Company. http://www.mckinsey.com/industries/capital-projects-and-infrastructure/our-insights/one-belt-and-one-road-connecting-china- and-the-world.

2 Parker, John, “What is China’s belt and road initiative?” The Economist. https://www.economist.com/blogs/economist- explains/2017/05/economist-explains-11.

3 Reuters. “China’s Investment China’s Investments in Countries Along Its ‘Belt and Road’ Project Are Soaring.” Fortune. http://fortune.com/2017/08/15/china-one-belt-one-road-obor-investments/.

4 Ibid.

5 Bradsher, Keith. “U.S. Firms Want In on China’s Global ‘One Belt, One Road’ Spending.” The New York Times. https://www.nytimes.com/2017/05/14/business/china-one-belt-one-road-us-companies.html?.

In the interest of full disclosure, we call the reader’s attention to the fact that Equities.com, Inc. is compensated by the companies profiled in the Spotlight Companies section. The purpose of these profiles is to provide awareness of these companies to investors in the micro, small-cap and growth equity community and should not in any way be considered as a recommendation to buy, sell or hold these securities. Equities.com is not a registered broker dealer, investment advisor, financial analyst, investment banker or other investment professional. We are a publisher of original and third party news and information. All profiles are based on information that is available to the public. The information contained herein should not be considered to be complete and is not guaranteed by Equities.com to be free from misstatement or errors. The views expressed are our own and not intended to be the basis for any investment decision. Readers are reminded to do their own due diligence when researching any companies mentioned on this website. Always bear in mind that investing in early-stage companies is risky and you are encouraged to only invest an amount that you can afford to lose completely without any change in your lifestyle. Equities has been compensated with cash, common shares and/or warrants for market awareness services provided.