CJAH Blog - for the week ending 11th September
CJAH Blog – for the week ending 11th September 2009
It has been quite a week as I attended the 13th CIFIT which took place as ever at Xiamen and these are some of the impressions and thoughts that emerged from the two days that I was there. The overriding thoughts that I have come away with are that this is now very firmly an event that is directed by the Central Government and both the Provincial and Municipal Governments that are involved are minor players in the event. It was clearly driven by the Minister of Commerce Chen Deming supported by Mofcom. Interestingly Mme Wu Yi was present and highly lauded and the event was presided over by a senior member of the Politburo. I have attached some papers that set out the structure and objectives of the CIFIT.
There were essentially two overarching impressions that I gained from the fair, the first being the focus on ‘Cross Straits Relationships’ and the second on the internationalization of the CIFIT, a them to which I shall return. It was clear to me that in Fujian at least long term integration of Taiwan into the China economic model was a given. There was much emphasis on the need to complete the construction of the ‘Western Special Economic Zone’ which it seems to me is designed to suck the hi tech industries out of Taiwan into the mainland. This interestingly I believe is consistent with the changes in the business model being developed in Guangdong Province where the focus is on attracting cutting edge technologies preferably those of the medium and smaller sized entities. To underline this theme quite apart from every speech made by a senior leader emphasizing this point the Taiwanese delegates received ‘privileged nation’ (sorry wrong analogy but you know what I mean) status. At its most mundane the extravagant fireworks/ music event produced an overdose on the common features of both sides of the straits and again had as its main theme the speedy completion of the ‘Western Special Economic Zone’ – I have attached a copy of the programme.
That this has become a thoroughly international event is underlined by the almost total removal of the municipal level of exhibitor which has always been an interesting feature of the event and these have been replaced by a wide range of international exhibitors all of whom represent national interests. In fact it was a complete list of China’s current trading targets. The USA, major European countries (the UK excepted) Africa (South Africa, Zimbabwe, Zambia, Kenya, diverse West African Countries), South America (Mexico, Cuba, Venezuela, Argentina) and Mauritius. Almost all of these were represented at a senior level either at Deputy PM or at trade ministerial level. What I found particularly interesting in the representation of china’s ‘New markets’ was that far from promoting their commodity output these were about enabling normal forms of trade. Clearly accusations of the past two years of Chinese exploitation of such commodity producers have been taken to heart and these countries encouraged and no doubt sponsored and assisted to participate actively promoting their own local products. I was much tempted to buy a can of Zambian coffee just to make the point.
The more that I travel across China and also live there, the more I am struck by the challenge that a modernizing China represents to the rest of the developed western world and specifically to the USA. The emergence of a developing economic superpower rich, with a modern infrastructure at a time when the west faces the challenges of ageing infrastructure, excessive public and private debt will be major features of these economies over the next decade. This is probably a statement of the obvious but the combination of modernity, a committed nation, high quality education and what seems to me to be the clear long term vision is a powerful cocktail.
Viewed from the Hong Kong perspective it is critical that it recognizes that it is well ahead of the principal competitor cities but this advantage will erode unless the government takes active steps to promote the ‘Added value’ that it brings to the Chinese nation with the Central Government and has an active lobbying programme to ensure that these values are maintained.
From Xiamen I traveled onto Guangzhou to attend the 2nd China International Financial Services Conference which was attended by some 1400 delegates. It was addressed by senior official from both the Central and Municipal Governments. Essentially the theme that was at the heart of the conference was that China’s GDP is grossly deficient in the contribution that the services sector makes when compared with other developed and developing economies. Clearly Guangzhou has the aspiration and the will to carve out a significant slice of this business for itself and it is putting in place policies to attract international players and regional headquarters – watch out Hong Kong! It was a most interesting day and I would encourage members to attend the 3rd conference next year.
