Doing Business in Asia
• China’s No. 1 fair
• 15,000 products varieties on display
• 40% of China’s newest product in exhibit
• 22,320 exhibitors @ 12 million ft2 floor space
• 188,170 buyers
• 55,927 display booths
• Brought in US$30.5 billion businesses @ show in 2009
• 53 years in history of making
Interzum Guangzhou 2010
China & India on
Global Recovery Driver Seats
Global Real GDP
(annualized quarterly growth rates) Global
Source: International Monetary Fund
How to Enjoy Zero Tariff?
Meet one of the following conditions:
• Products are completely
originated in China;
• The value of the materials
coming from other than
China and ASEAN countries
is less then 60%; or
• Products are produced by sufficient
processing the materials coming from
other than China and ASEAN countries.
How Does ASEAN Cope with
This Sweeping Change?
• Not so 10 years ago, the trade balance titled to
• Today: -
– Chinese competition has growing louder
– A direct competition with Chinese firms will be deadly
– A lower cost of capital
– A lower wages in China
– A limited accountability to shareholders
– Chinese investments are sweeping in ASEAN
– ASEAN becomes a popular place for Chinese investments
– ASEAN in general accept Chinese quality with low pricing
Opportunities & Challenges
In Asia Markets
Emerging Asia Market
• Economic expansion policy in general.
• Export trade returning – especially the demand from China
market which is helping the region to flourish
• Rising inflation with low household’s debt pushes up
• Rising exports in Vietnam made them the fastest GDP growth
in the 1st half of 2010.
• Indonesia is the largest nation in ASEAN and accounted for
60% consumer spending. The growth will get stronger due to
a boom in domestic investments.
• Malaysia has a strong and stable economy and
it is one of the fairly mature market in ASEAN.
Risk Factors in Emerging Market
• Full recovery is not yet proven.
• Majorities depend on the export markets
aboard which are facing slow recovery and
not yet quite normal.
• Government’s economic stimulus can’t last
• Increased the consumers’ spending to correct
global recovery is not an easy task.
• Increased risk from capital asset
Huge Market Potential in the Asia
Opportunities in Asia Emerging Market
• Rising middle-class consumers
• Cities migration
• Modernization in retail sector
• Sell goods directly to retailers or at help of
• Opportunity in building brands
Market Entry Strategies
• Don’t dump products that do not sell well.
• Introduce quality products similar in here.
• Products with good features and reasonable
price fetch success.
• Created branded product to standout from
• Provide warrantee and after-sales services
especially to electronic items.
Challenges and Risk Factors in the
• Stability in government and fiscal budget
• Bureaucracy, corruption and protectionism
• Infrastructures not sound
• Retailer sector immature
• Purchasing power is limited
Developing Chinese Market
• Major cities in China’s coastal region has a faster
phase of recovery.
• Government’s stimulus packages to help rural
development benefited the purchasing power in the
2nd and 3rd tiers cities.
• The stock market and housing price surged
increased demand for medium- to high-end goods.
• Market the trendy products to meet the need of
• Consider using several market channels for
penetration – franchise store is a popular one.
China’s Super-Rich Population
William Chu, Representative
State of North Carolina Asia Pacific Office
Room 805-6, Tesbury Center,
28 Queen’s Road East, Wanchai, Hong Kong