Want to do business with China? Don’t let the headlines scare you.
China lays claim to the world’s second-largest economy. With double-digit economic growth over most of the last three decades, China represented 17 percent of the world’s GDP in 2014, The International Monetary Fund reports. Despite recent economic reports, the country’s relevance as a consumer market and influence on local investment strategies continues to grow.
Elizabeth Rowland, founder of TN-China Network, suggests companies interested in entering the Chinese market focus on the country’s economic fundamentals, not just the stock market.
“The slowdown is part of the country’s economic restructuring to move up the economic value chain towards more value-added services,” Rowland says. “Their growth rate has predictably slowed to a rate more comparable with other advanced economies.”
She also suggests that businesses not let stock market turmoil distract them from what really matters: does your product or service have a market in China?
Rowland, whose organization works to enhance bilateral trade with China and boost investment and job growth in Tennessee, reports that China ranks as the third largest export market for the state, valued at $2.5 billion in 2015.
And that investment goes both ways, with Chinese companies capitalizing on business opportunities here in Tennessee as well. Approximately 25 Chinese companies currently invest in or have recently announced they will invest here.
In the last seven months, three Chinese companies announced major investments in the Chattanooga region, including Yanfeng Automotive Interiors in Hamilton County and Vanguard National Trailer in Dade County, representing a combined $85 million investment. Additionally, Chinese appliance manufacturer Haier recently acquired a line of business from General Electric, giving the company roots in Walker County.
“If a Tennessee company plans to import from, invest in or export to China, learning about Chinese culture is no longer a competitive advantage, but a prerequisite,” Rowland says.
With local Chinese investment on the rise, it’s a great time to learn the basics.
TN-China Network Travel Tips:
- Pack an open mind. Withhold judgment, be patient and remain curious about the vast differences between Western and Eastern culture.
- Give gifts, an important part of business culture in China. Present hosts with a wrapped present, perhaps something traditional in U.S. culture.
- Learn a few phrases. Be the rare American who knows at least a little Chinese.
- Be prepared. Carry tissue, hand sanitizer and bottled water during outings. Many restaurants and public restrooms may not have soap or toilet paper, and tap water isn’t generally safe for consumption.
Grow globally and locally with these resources:
Chattanooga International Business Council – A council of the Chattanooga Chamber and the leading advocate and resource for international business. Provides a culturally diverse forum for organizations, business leaders and communities through monthly meetings and educational events. Visit IBC.ChattanoogaChamber.com to learn more.
Chattanooga Chinese School – Offers Mandarin language courses on the Chattanooga State campus for ages 5 to adult. Visit cca-ccs.org for more information.
TN-China Network – Educates and connects people across Tennessee and China through events and online resources. Will host China Importing 101 June 2 at 8 a.m. at the INCubator in partnership with the Small Business Development Center. Visit www.TNChinaNetwork.org for more information and to register.