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CIIE, the Key to the Chinese Market

2019-11-29 13:59:00 Source:China Today Author:DANG XIAOFEI & ZHOU LIN
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FRENCH red wine, Russian dairy products, and South American coffee — these are just a small sample of the ever increasing number of high-quality products entering the lives of Chinese consumers through the China International Import Expo (CIIE), creating new business opportunities for global enterprises to enter the Chinese market.
                

                                                          The CIIE mascot “Jinbao” made of Lego blocks takes the center stage of the space for high-quality life.

Broad Prospects for China-EU Economic and Trade Cooperation

Present at the CIIE was French President Emmanuel Macron, who invited Chinese President Xi Jinping to taste French wine and beef products. Speaking at the French pavilion, Xi said that China’s consumer market is large enough to meet diverse needs at different levels. It is hoped that French entrepreneurs will have a long-term vision and enhance mutually beneficial cooperation with China.

As long-term strategic partners, China and France have very close cooperation in energy, infrastructure, transportation, and aviation among many other fields. More than 80 French companies attended the second CIIE, including such famous brands as Louis Dreyfus, Danone, and L’Oreal.

Atermes, a French intelligent and high-end equipment company, has been cooperating with a scientific research institution in southwest China’s Chengdu for 16 years, to provide technical solutions for China’s border defense system. Lionel Thomas, deputy general manager and sales executive manager of the company, is very familiar with the Chinese market. He told China Today that he agreed with Xi’s proposal to build a global economy in a cooperative way. “I think it is important to create opportunities to share advanced technology with a big country like China. For us, this is not only an opportunity to carry out business in China, but also to expand business outside China, such as in countries of Asia and the Middle East, and countries along the Belt and Road,” said Thomas.

Linde Hydraulics GmbH & Co. KG, a CIIE exhibitor from Germany, entered China in 2012. Janfried A. Tirre, the company’s executive vice president, told China Today that their market in China is growing rapidly due to the country’s stable and open economy and constantly improving business environment. “In fact, we are serving the global market,” said Tirre. “CIIE is a truly important platform to help our company find potential partners. It also sends a strong signal to the world that the Chinese manufacturing industry occupies a significant echelon in the world market,” he added.

Italian company Olivotto Glass Technologies cooperates with China to produce high-quality glass products through its competitive AI manufacturing system. In the early 1970s, the company established ties with China, and now has customers in different applications. Andrea Valle, the company’s business unit manager, said being at the CIIE was his first visit to China and as the market is vitally important Olivotto would be back for next year’s expo.

                                

                                                                            A Uruguayan booth for beef export at the CIIE.                                  

Further Exploring the Chinese Market

During the second CIIE, Lego brand of Denmark announced that it would choose Jinshan District, Shanghai, as the site for its family entertainment theme park resort.

Lego Group, which entered the Chinese market more than 30 years ago, opened its first flagship store in Shanghai in 2016. In the year following the first CIIE, the number of Lego Group’s brand retail stores in China increased by more than 70 in over 30 cities, including many second and third tier cities. Such development made the Lego Group so confident in the Chinese market, that it decided to take part in the second CIIE and bring a series of new green and environmentally friendly products.

Since the participation in the CIIE has brought remarkable results, many of the world’s top 500 companies that participated in the first CIIE also actively participated in the second one. More than half of them expanded their exhibition area, said Sun Chenghai, deputy director of China International Import Expo Bureau.

As a company dedicated to the R&D and manufacturing of milling and machining centers with medium and large structures, Nicolas Correa of Spain has been in the Chinese market for more than 30 years, but has never broken through the bottleneck of sales volume. Since the first CIIE last year, the company has received orders from more than 80 Chinese buyers. Ignacio Alfayate, general manager of the Asia branch of the group, said that last year, of all the orders the company obtained, one fifth came from the CIIE platform. “It is estimated that at least 100 orders will be received this year, because a dozen well-known Chinese companies have shown a strong interest in our products and a strong willingness to buy in the months before the exhibition,” said Ignacio. These tangible benefits have given him full confidence in the CIIE platform, and he will continue to participate in CIIE next year.

With the continuous growth of cross-border e-commerce in China, more and more foreign-funded enterprises have put their exports online.

INTERLOOM S.A.C. is a Peruvian food company that came to participate in the exhibition for the first time. Only two hours after the official launch of the second CIIE, three Chinese buyers came to discuss the importation of the healthy grain quinoa from Peru. Quinoa was recently approved to enter the Chinese market. The company is planning to cooperate with Chinese Internet giants JD.com and Alibaba, so that Chinese consumers can buy featured products from Peru without leaving home.

In addition to commodity trade, LatinAmerica Experiences, a travel company from Ecuador, has also noted the business opportunities for the export of tourism services to China. Pablo Palacios, the company’s founder, said that he not only sought to promote Ecuador’s private customized tourism to China, but also intended to launch an educational tourism service by combining tourism and education. Several Chinese educational institutions already discussed further cooperation with him.

The CIIE not only provides opportunities for foreign enterprises to expand in the Chinese market, but also brings high dividends to foreign enterprises with hi-tech products. Medtronic brought the world’s smallest cardiac pacemaker Micra to the first CIIE, which became a star product. Just over half a year later, China’s National Medical Products Administration approved Micra’s sale in China with a special approval process.

Zhou Zuyi, director of the Communication Department of Medtronic’s Greater China region, said that during the second CIIE, Medtronic put nearly 50 products of advanced medical technology on display, marking the debut of many of them in the world, involving such fields as intelligent surgery and neurological and spinal surgery.

Under the circumstances of the cooling economic and trade relations between China and the U.S., American companies participating in the CIIE are enthusiastic, with 192 exhibitors marking an increase of 18 percent over last year. The exhibition area of 47,500 square meters was also the largest among participating countries. “It can be seen that the Chinese market has a huge attraction for domestic and foreign companies, including those from the U.S.,” said Ren Hongbin, China’s Assistant Minister of Commerce.

              

                                                             “Made in Russia” is the theme of the exhibits in the Russian National Pavilion.Photos by Yu Xiangjun

Business Environment Is Improving

As one of three major beef suppliers for China, Uruguay’s fresh beef has attracted the attention of many buyers. In just half a day, beef provider Pando won 30 big orders. Nicolas Melian, the company’s export manager, said that due to a series of trade facilitation measures, China has greatly reduced the importation period of its products. In 2018, China reduced the number of regulatory documents for import and export inspection to 48, and promoted one-time joint inspection of customs, border inspection, and maritime affairs. By the end of December 2018, the overall clearance time of imports and exports had been reduced by 56.4 percent and 61.2 percent respectively compared with the previous year.

The improvement of the business environment in China is not limited to this. China’s National Development and Reform Commission and the Ministry of Commerce issued a negative list of foreign investment access in 2018, launching a new round of opening-up measures in 22 fields. The restrictions on foreign investment in banking, securities, automobile manufacturing, power grid construction, railway line network construction, chain gas station construction, and other fields will be cancelled. In October 2019, the State Council of China promulgated the regulations on optimizing the business environment, which laid a solid legal foundation for improving the business environment at the national level.

At the opening ceremony of the second CIIE, Xi Jinping pointed out that in the future, China will continue to remove major constraints on economic development, gear up reforms regarding key links and areas, and modernize the system and capacity for governance as an institutional support for high-standard opening-up and high-quality development. Xi further committed that China will continue to foster an enabling business environment that is based on market principles, governed by law, and up to international standards. China will also give foreign investments greater market access to more sectors, further shorten the negative list, and improve institutions for investment promotion and the protection of information reporting.

About the continuous improvement of the business environment in China, Ignacio Alfayate, general manager of the Asian branch of Spain’s Nicolas Correa Group, said that from tax reduction to streamlined administration and services, Spain has benefited from a series of favorable policies and new measures in China, especially the tax reduction policies regarding foreign enterprises, which helped the company expand its market share in China. Alfayate indicated that Nicolas Correa Group’s outstanding performance in China is inseparable from the country’s improved business environment. In the future, the company plans to increase its investment in China.

In the view of Federico Stanham, president of the National Meat Institute of Uruguay, by embracing economic globalization, advancing reform and opening-up, and guaranteeing the national treatment of foreign firms, China ensures a level playing field for both domestic and foreign companies. China’s Foreign Investment Law, which will come into effect on January 1, 2020, further reassured foreign companies, according to Stanham.

According to the World Bank’s “Doing Business 2020,” China’s business environment ranks 31st in the world, advancing 15 places from the 46th place last year. China has been selected by the World Bank as one of the 10 economies with the largest improvement in business environment for two consecutive years. With the implementation of the new round of policies on reform and opening-up as well as the improvement of business environment, the Chinese market will become more attractive to businesses from around the world.  

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