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East Asian firms bank on China amid slowdown
Source: Xinhua |
December 27, 2011, Tuesday
|
Print Edition
Print Edition
WHILE the world's economy is grappling with economic jitters stemmed from Europe and the United States, Asian countries are painstakingly tapping the Chinese market as the country's strong imports offer a dose of confidence amid faltering external demand.
The resilience of the world's largest developing economy prompted many, including a World Bank economist, to recognize it as a positive factor for the Asia Pacific region, while Moody's Analysts said in a recent report that a "rising China lifts all boats" in the region.
Singapore's food and beverage retailer BreadTalk, which runs bakery, food court and franchised businesses, opened its 215th outlet in China recently.
The food retailer is just an example of the many foreign companies that have successfully grown their businesses by thriving on the Chinese mainland. Notably, they include not only infrastructure businesses, but also consumer brands that explore the different tiers of cities.
BreadTalk outlets in China are distributed across the first- and second-tier cities. Shanghai and Beijing lead with 33 and 25 outlets, respectively, while the number ranges from one to 13 for 40 other cities. It even opened four outlets in the northern city of Harbin and five in the western inland city of Urumuqi, a provincial capital in Xinjiang.
George Quek, chairman and founder of BreadTalk, has said that the company would like to have 1,000 outlets by the end of 2012, of which at least 550 will be in China. Now it has about 500 outlets, of which 215 were opened on the Chinese mainland within eight years.
Many of the consumer brands from Singapore are quickly expanding their businesses beyond the first-tier cities in China. Brands such as Charles & Keith, Bee Chen Hiang and OSIM are also eyeing the Chinese market, trade promotion agency International Enterprise Singapore said.
Not only the consumer brands are benefiting from China's growth. The trade promotion agency has urged Singapore firms to ride on the opportunities arising from the development of China's western inland regions.
CapitaLand, one of the largest developers in southeast Asia, along with a consortium, recently won a bid to build a US$3.3 billion complex in the southwestern city of Chongqing. The complex will comprise eight buildings, including high-end residential units as well as a shopping mall. It will be designed by world-renowned architect Moshe Safdie, who has designed the landmark casino resorts Marina Bay Sands in Singapore.
The Chongqing project will have a gross floor area of 817,000 square meters, with about 41 percent being residential and the rest retail and offices.
Liew Mun Leong, chief executive of CapitaLand, compared Chongqing to Chicago of the United States, saying that it is expected to catch up with the coastal cities soon.
CapitaLand, which has begun its investments in Shanghai and Beijing and then gradually expanded to the rest of the country, expected its assets in China to increase to 42 to 45 percent over the next three to five years from 35 percent now. Singapore's contribution will fall from 35 percent to 33 percent.
Other companies are also stepping up their expansion in China. Business conglomerate Keppel has numerous utilities projects in China while developer UOL Group runs mall and office projects. Other projects inaugurated in recent years were Nanjing Eco High-tech Island and the Guangzhou Knowledge City.
Bert Hofman, the World Bank's chief economist for East Asia and Pacific, said he saw a shift in the demand pattern of China so that the country is increasingly important as a market for final consumer goods.
"China's imports grew more quickly than China's exports. So it does mean a bit of an improvement in the current account. It also means an opportunity for the rest of East Asia to increasingly export goods to China. Within the rapidly growing imports, you also see consumer demand, final consumer demand over consumer goods, is increasing from China," he said.
The resilience of the world's largest developing economy prompted many, including a World Bank economist, to recognize it as a positive factor for the Asia Pacific region, while Moody's Analysts said in a recent report that a "rising China lifts all boats" in the region.
Singapore's food and beverage retailer BreadTalk, which runs bakery, food court and franchised businesses, opened its 215th outlet in China recently.
The food retailer is just an example of the many foreign companies that have successfully grown their businesses by thriving on the Chinese mainland. Notably, they include not only infrastructure businesses, but also consumer brands that explore the different tiers of cities.
BreadTalk outlets in China are distributed across the first- and second-tier cities. Shanghai and Beijing lead with 33 and 25 outlets, respectively, while the number ranges from one to 13 for 40 other cities. It even opened four outlets in the northern city of Harbin and five in the western inland city of Urumuqi, a provincial capital in Xinjiang.
George Quek, chairman and founder of BreadTalk, has said that the company would like to have 1,000 outlets by the end of 2012, of which at least 550 will be in China. Now it has about 500 outlets, of which 215 were opened on the Chinese mainland within eight years.
Many of the consumer brands from Singapore are quickly expanding their businesses beyond the first-tier cities in China. Brands such as Charles & Keith, Bee Chen Hiang and OSIM are also eyeing the Chinese market, trade promotion agency International Enterprise Singapore said.
Not only the consumer brands are benefiting from China's growth. The trade promotion agency has urged Singapore firms to ride on the opportunities arising from the development of China's western inland regions.
CapitaLand, one of the largest developers in southeast Asia, along with a consortium, recently won a bid to build a US$3.3 billion complex in the southwestern city of Chongqing. The complex will comprise eight buildings, including high-end residential units as well as a shopping mall. It will be designed by world-renowned architect Moshe Safdie, who has designed the landmark casino resorts Marina Bay Sands in Singapore.
The Chongqing project will have a gross floor area of 817,000 square meters, with about 41 percent being residential and the rest retail and offices.
Liew Mun Leong, chief executive of CapitaLand, compared Chongqing to Chicago of the United States, saying that it is expected to catch up with the coastal cities soon.
CapitaLand, which has begun its investments in Shanghai and Beijing and then gradually expanded to the rest of the country, expected its assets in China to increase to 42 to 45 percent over the next three to five years from 35 percent now. Singapore's contribution will fall from 35 percent to 33 percent.
Other companies are also stepping up their expansion in China. Business conglomerate Keppel has numerous utilities projects in China while developer UOL Group runs mall and office projects. Other projects inaugurated in recent years were Nanjing Eco High-tech Island and the Guangzhou Knowledge City.
Bert Hofman, the World Bank's chief economist for East Asia and Pacific, said he saw a shift in the demand pattern of China so that the country is increasingly important as a market for final consumer goods.
"China's imports grew more quickly than China's exports. So it does mean a bit of an improvement in the current account. It also means an opportunity for the rest of East Asia to increasingly export goods to China. Within the rapidly growing imports, you also see consumer demand, final consumer demand over consumer goods, is increasing from China," he said.
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