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International emerging markets: China
10 Apr 2007
If a company doesn’t have a profile in China within the next two-to-three years, it quite possibly won’t be competitive in Europe in the next five, says Dr John L Collins, business development manager, The Manufacturing Technologies Association.
This month, at the CIMT exhibition in Beijing, which is one of the four most important manufacturing technology exhibitions in the world, more than 1,400 exhibitors from all around the world (including 30 or so from the UK) attracted more than 200,000 visitors in its seven-day opening period.
With a GDP of nearly £1,340 billion in 2006 (10.7% up on 2005) it’s an obvious market to attack. China’s economy is now ranked 4th in the world; and it is growing steadily.
The outlook for 2007 is daunting. According to Wu Bailin, president of the China Machine Tool Builders Association, speaking at the CIMT 2007 exhibition, the predicted total industrial output of the engineering industry is forecast to grow at 20%. Profits will grow by 24%, and imports and exports are set to increase by 25%, achieving a basic trade balance.
The engineering marketplace in China is not for the faint-hearted. China’s success is driven by its retail and machinery manufacturing sectors.
With the value of consumer goods reaching £500 billion in 2006, growing at an outstanding 14% on 2005, this trend is set to continue as more middle-class consumers emerge into the marketplace. It is uncertain that this is sustainable in the long term.
In the engineering arena, the machine building industry produced a total industrial output value of £360 billion, up 30% on 2005 and accounting for 17% of China’s industrial output value. This is down to the growth in automotive and electrical appliance sales requiring improved productivity through advancing manufacturing technologies.
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