CHINA

SOURCING MARKET CHINA

• Rapid change
• Leading exporting nation
• Market economy
• Entry in to WTO
• Still poor emerging country.
•
•
Convincing economic figure

 Grown in significance as a sourcing

market.
• Ready goods
• Manufacturing
 Huge market.
 Risk of not investing in china is much
higher then the risk of having that.
 41 billion $ [2000] to 57 billion $ [2003]
 Constant upward trend in GDP [8%].
 Red giant- Rank among 10 largest
economies.
 Third largest economy in 2017.
  Growth restricted to the eastern parts of country.
•

 Iron
• Steel
• coal
• Engineering
• Armament
• Textiles
• Petroleum
• Cement
• Chemical fertilizer
• Shoes
• Toys
• Electronics
• Telecommunication
•
  Guangdong , Jiangsu , Shanghai
 Long run
 Joint ventures
 Huge opportunity.
•
Sino-European economic
relation
 Chinese export and import from EU is
constantly increasing
 Relation have developed
 EU’s second largest trading partner
outside Europe is shifted from Japan to
China in 2002.
 Successful bilateral trade volume
 Exporting of high-tech products,
mechanical and electronics products
improved
 EU has been China’s largest technology
supplier and fourth largest investor in
 In 2005, china introduced 20,925
technologies with a contracted value
amounting to 87.1 billion dollars.
 European companies set up 22,076
business in china, bringing the
contracted investment volume to 84.7
billion dollars, with actual investment
hitting 46.7 billion dollars.
 High-tech sector has been key fields
attracting European Investment.
 A Medium and long-term plan for Sino-
European trade is being drafted, and
bilateral trade volume is expected to hit
300 billion dollar in the near future.

Opportunities and challenge in
conducting business in China
 Economic growth of the last few years will continue,
although at a slower rate.
 Chinese companies however, are increasingly taking
this foreseeable development into consideration
with respect to their expansion strategies and are
sitting their sights on foreign markets.
 Especially due to the different mentalities and
business miens, one or two years could easily go
by until a close partnership being a basis for
mutual growth can be formed.
 Chinese economy does indeed harbor some risks
and threats. Corruption, for example, is
commonplace.
 Cost of raw material, too drastically rising and are
threatening to wipe out the savings made on
labor costs in the long run.
 Areas are facing overcapacity.
Procuring tools in China

 Extraordinary economic growth in China

is also impacting the automobile
industry.
 Over 2 million automobiles were
manufactured.
 Many new manufactures such as
Volkswagen, BMW, Ford, Fiat, General
motors have set up production
facilities in China.
 Competition has intensified due to
growing overcapacities, and this is
forcing manufactures to reduce prices.
 Companies like Volkswagen has to suffer
a loss of 400 million euros.
 Chinese tool market turnover rose
from $1.34billion US to $5.49 billion
US, annual growth rate of 15%.
 Tools exported in recent years have
increased from $39 million to $336
million.
 Imports had doubled from $675
million Euros to 1.4 billion Euros.
 Companies engaged in tool
construction rose from 6000 to
20000, and employees rose from
300000 to 500000.
 People have tremendous interest in
foreign markets, some companies
export 75% of their production.
 Companies are trying to improve
quality standards, 90% of exporters
think that if they maintain the
quality the trade would be smooth.
 Cost can be reduced up to 60% in
china.
 The only problem is of
communication which the Chinese
exporters faces.

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您好
Hao Ni