TRADE between China and Arab countries is rising, and a major conference opening today in Hangzhou encourages Chinese companies to invest in the region. David Maguire reports.

The focus of hundreds of Chinese business leaders will be on emerging opportunities in Arab countries at a top-level conference and investment seminar starting today.

The China-Arab Business Conference, the third in a program initiated by President Hu Jintao in 2004, is expected to attract more than 600 Chinese companies to learn about investment prospects, trade development and business matching opportunities.

Twenty member countries of the League of Arab States will be represented by about 400 delegates, including 13 government ministers as well as officials and ambassadors to China.

The league, a unity of Arab states in Southwest Asia and North and Northeast Africa representing a population of about 339 million, is one of the world's oldest regional organizations and has a membership of 22 nations.

Representatives of Syria, United Arab Emirates, Mauritania, Egypt, Yemen, Jordan, Comoros, Iraq, Bahrain and Saudi Arabia will be among speakers during two days of meetings and a dinner in Hangzhou's five-star Hyatt Regency Hotel on the banks of the West Lake.

The conference is one of many planks of dedicated engagement between China and the league under the China-Arab Cooperation Forum to strengthen political, business and cultural ties. It has been organized by the Hangzhou chapter of the China Council for the Promotion of International Trade.

It represents the highest level of formal trade development initiated by the governments of China and Arab countries and is therefore one of the most important platforms of the bilateral relationship.

Hosting such a top-level international event is a major achievement for Hangzhou, as the first two bilateral business conferences were held in national capitals, Beijing and Amman in Jordan. It follows on the heels of the Zhejiang Province capital's successful hosting of an APEC Business Advisory Council meeting last year, also organized by the local CCPIT.

The value of foreign trade between China and Arab states has been rising in recent years and Arab nations are an important emerging market for Zhejiang Province.

Trade between China and the 22 league countries reached US$130 billion in 2008, ranking them 8th in value to the nation. China is one of the main export markets for Arabian crude oil and further cooperation is being developed through bilateral investment, infrastructure construction, human resource development and information technology.

Business matching

Hangzhou CCPIT's Vice President Jiang Jindong said conference members would have an opportunity to visit the vast commodities sourcing market at Yiwu, 100 kilometers south of Hangzhou, which is home to about 5,000 Arab traders.

"We can see the huge potential between Chinese and Arab businesses through Yiwu, an important trading center in its own right," Jiang said. "This can extend to other Zhejiang areas such as Shaoxing City where the focus is on light industry and textiles, and IT businesses at industrial parks in Hangzhou," he said.

Today's conference activities will review the status of bilateral trade relations and assess prospects for the future, discuss trade initiatives that could stimulate activity during the current financial crisis, consider further SME (small to medium enterprise) collaboration and assess the prospects of China-Arab financial cooperation.

Speakers will include China's Deputy Minister of Commerce Fu Ziying; Assistant Minister for Foreign Affairs Zhai Jun; Deputy Party Secretary of Hangzhou, Wang Jincai; CCPIT Chairman Wan Jifei; Vice Governor of Zhejiang Province, Gong Zheng; and the Deputy Mayor of Hangzhou, Tong Guili.

Visiting speakers include the UAE's Minister of Foreign Trade, Sheikha Lubna al Qasimi; Syria's Minister of Development and Co-chairman of the China-Arab Business Conference (with Wan Jifei) Husein Mohamoud Farzat; President of the Iraqi Chambers of Commerce Federation, Jaafar R. Jaafar al Ghrairi; and representatives of the Jeddah and Bahrain chambers of commerce.

Tomorrow, a business matching session will precede offsite visits to Yiwu and Hangzhou industry.

Jiang Jindong's CCPIT organization will draw as much benefit as possible for Hangzhou from the conference, notwithstanding its aim is to enhance the big picture of "political, economic and cultural relationships between China and the Arab states."

"We would like to further develop the business links between Hangzhou City and Arab enterprises to improve the internationalization of Hangzhou," he said, adding it is one of China's most progressive cities and is ranked in the top 10 economic and industrial powers in the country.

"Hangzhou has established business partnerships with over 200 countries around the world as well as 17 sister city and 40 friendship city relationships," he said. One of these includes the Arab League state of Morocco.

"Hangzhou was judged the best city for investment in China by the World Bank for four consecutive years, 2005-2008, and at the same time was judged best commercial city in China by Forbes magazine," Jiang added.

"The business and living environment of Hangzhou has encouraged a lot of international operators to establish their own businesses, such as IT companies, to take advantage of favorable government policy incentives," he said.

"Hangzhou's tourism profile helps attract business to some extent because people can experience a high quality of life that is conducive to work."

Hangzhou's foreign trade

Import and export volume value in 2008 was US$48.1 billion, up 10.7 percent on the previous year.

Electronics and machinery exports were valued at US$13.4 billion; hi-tech exports were valued at US$4.6 billion.

Exports to European Union countries increased by 23 percent, to Japan by 6 percent.

Foreign direct investment increased by 11.6 percent.

Total investment by foreign enterprises amounts to US$61.8 billion.

(Source: Hangzhou CCPIT)