SOURCE / ECONOMY
Global businesses eye growing opportunities in China under 14th Five-Year Plan
Published: Apr 21, 2021 06:28 PM
 


Business representatives, experts talk during this year's Global Times RoundTable in Beijing on Thursay. Photo: GT

Business representatives, experts talk during this year's Global Times RoundTable in Beijing on April 15. Photo: GT



As the only major economy to achieve an economic growth amid the COVID-19 pandemic in 2020, China is unfolding its 14th Five-Year national development plan, while global companies from different sectors including finance, IT, automobile and education are eyeing opportunities to enter a market of 1.4 billion consumers. 

At the Global Times Leader Roundtable in association with North Head last Thursday, which discussed the topic, China's Duel Circulation Strategy Era and 14th Five-Year Plan, business leaders and scholars shared their views while calling for more stable international relations to boost the world's economic recovery.

While the global economy was severely impacted by the pandemic in 2020, the Chinese government proposed the "dual circulation" strategy, where the domestic economic growth plays the leading role while the international economy is positioned as a useful supplement. 

The whole strategy aims to address and hedge this instability and uncertainty of both domestic and global economies. The world is experiencing a fast-changing period marked by the fallout of the pandemic and geopolitical fights, including growing protectionism from some quarters on this planet.

2021 is the first year of the 14th Five-Year Plan and the Chinese government has announced a six percent GDP growth target for the year. Under such a plan, leaders from many business sectors have apparently found useful directions for the coming years. 

Lv Qiang, Divisional Vice President of Abbott Laboratories, said he believes the 14th Five-Year Plan will bring a bright future for the healthcare sector, as the number of cooperation between Chinese and many overseas companies are becoming closer.

"Based on a research by ChinaBio, in the past year, big global pharma made 271 licensed partnerships with Chinese biotech company. The number means a 50 percent increase from 2019, and a 300 percent rise from 2015. At Abbott, we have also seen business partnering with local companies, included SinoPharm and JD.com. So if you look at those deals which are the collaborative efforts to increase accessibility and affordability to more people. I see these as a bright future," Lv said.

"In the past year the automotive industry in China has been really privileged. We are grateful for the Chinese government's effective measures to bring the coronavirus largely under control," said Leng Yan, executive vice president of Daimler Greater China.

"That has set a good foundation for a speedy recovery of the Chinese economy, which also created many growth opportunities for the automotive segment," Leng added.

"So, looking forward, Daimler is quite optimistic as China has set the GDP growth target at above six percent for 2021, and with the government's new infrastructure push, we believe it will release a lot of potential for domestic consumption," Leng said. 

"We see opportunities in three parts in the education sector in China," said Athena Liu, Director Government Relations of Pearson, a global learning company. 

"The first one is online education. There has been a greater emphasis on digital education. Due to the pandemic the learning landscape has changed a lot. There will be plenty of scope for this approach in China," Liu added.

The second one is teachers training. In the 14th Five Year plan the government will focus on expansion capacities from pre-school to higher education which may create a lot of teacher training opportunities," Liu said.

"The third part is working skill. Vocational education has been becoming increasingly important in China, which means that the education sector has more opportunities to collaborate with other sectors to help the learners to achieve their potential," she added.

"Attracted by China's new growth opportunities and market potential, we have continuously expanded our investment, further optimizing our business footprint in China." said Lars Eckerlein, General Manager of ABB (China) Limited.

"Last year, ABB completed the acquisition of Chargedot to better meet China's growing demand for EV re-charging facilities. ABB's new robotics manufacturing and research facility in Shanghai is being built now. It is set to open in Q1 2022 when it will be our most advanced and automated robotics factory across the world where robots make robots, utilizing the latest manufacturing processes including machine learning and digital solutions."

While eyeing the rising opportunities in the country, business leaders voiced some concerns about the unpredictable geopolitical factor that cast uncertainties for their businesses and called for more stable and sustainable global relations.

"China continues to be a very attractive market for private equities investment. Overall, international financial companies are glad to see more opening up and increasing market access across the financial sector," noted a representative from a leading US investment firm.

John Russell, moderator of the roundtable and managing director of North Head, agreed. Global investors in China are focusing on China's home market, but the most challenging factor is the uncertain China-US relations and the geopolitical tensions. The restricted investments in some areas where there would be great opportunities. It is difficult to make decisions related to large investments when uncertainties remain as to where the relations are going," Russell said.

The above views were echoed by Jia Kang, a member of the 11th and 12th National Committee of CPPCC and president as well as chief economist of the China Academy of new supply-side economics, who urged countries to find common ground to rev up global cooperation to facilitate economic revival.

Citing Tesla's Shanghai Gigafactory as an example, Jia said that the deal between Tesla and Shanghai government was reached in 2018 when China-US trade tensions were at their height. Yet, one year later, the Tesla factory started production, providing car to both domestic and global markets.

This shows that even in difficult times, there are still opportunities of cooperation to exist, Jia said, adding that globalization has become an irreversible trend. 


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