COUNTRY FOCUS

EXTENSIVE RESEARCH With its report on China’s Regional Cities, CBBC has conducted research to help UK companies refi ne their approach to market entry. The fi rst report, on behalf of UK Trade & Investment, was carried out in 2008. This was enhanced by a new study this year by CBBC in conjunction with the Centre for International Business at the University of Leeds. The main objectives were to identify

regional cities in China that offer the most promise for UK companies, taking account of sector prominence. From here it matched opportunities against UK capabilities, focusing on eight key UK strengths – aerospace, automotive, construction, education, energy, healthcare, rail and retail – before updating how UK companies could capitalise on these opportunities in light of China’s continued growth. It also sought to identify current and

predicted challenges experienced by UK fi rms in China and propose strategies for overcoming them. “The focus for many UK companies in China continues to be in a small number of large and familiar cities such as Beijing, Guangzhou, Shanghai and Shenzhen,” says CBBC head of research Stewart Ferguson. “However, business conditions in these cities are evolving quickly. Companies

are experiencing mature and increasingly saturated markets in these locations. The growth in competition is coming from both other foreign fi rms and increasingly sophisticated Chinese companies. Moreover, factor input costs are at their highest there. As a consequence, many UK companies are seeking fresh opportunities in China’s regional cities.” Of the 274 Chinese cities with a population of more than one million, 35 were shortlisted (see below) by economic size, growth rate, population and level of inward foreign direct investment. These cities were then ranked to capture their relative attractiveness. “The more economically advanced the city, the more niche become the demand and solutions,” continues Ferguson. “Opportunities tend to be higher up the value chain in more economically advanced cities, matching the skill set offered by the UK, especially for SMEs. “The greatest challenges and barriers to trade and investment relate to the understanding of government regulation, policies and bureaucracy. UK Trade & Investment and CBBC can play a valuable role in providing companies with the information they need to better understand Chinese government regulation and to help them navigate the business environment at both a national and local level.”

HELP AND SUPPORT The business relationship between the UK and China is taken seriously at the highest levels, as refl ected in the largest ever ministerial visit to China led by Prime Minister David Cameron last November. That visit, followed by Chinese Premier Wen Jiabao’s trip to the UK in June, resulted in business worth billions of pounds.

Among the successful companies was BRE, a UK company that supplies sustainable design, construction and management advice for all types of building, from homes to hospitals, and schools to corporate headquarters. It signed a Memorandum of Understanding on research and development with Vanke, China’s largest residential property developer. This followed the signing of a contract on the development of Innovation Park Beijing. Dr Peter Bonfi eld, CEO of BRE says:

“This represents a huge opportunity for UK companies to showcase their services and products in the world’s largest growth economy, where millions of new homes are required in the coming decades. This collaboration has come about due to the efforts and commitment of the UK and Chinese governments and embassies, along with UK Trade & Investment.” ■

* FOSHAN * DONGGUAN * DALIAN * CHENGDU * YANTAI * TANGSHAN * CHANGZHOU * WUHAN * SHENYANG * CHANGSHA * ZIBO * SHAOXING * NANTONG * CHANGCHUN * WEIFANG * WENZHOU * XIAMEN * QUANZHOU * XI’AN * HEFEI

FIND OUT MORE

Discover opportunities for your business in China at cbbc.org. Contact the China- Britain Business Council on 020 7802 2000 or email enquiries@cbbc.org

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