China s first overseas project contracting enterprise has gone beyond Sichuan and started business in Bangladesh. Among the 9 foreign consular agencies in Chengdu, two are of South Asian countries.
In 2009, about 1100 Sichuan enterprises had trade relations with South Asian countries. Sichuan s export to South Asia accounted for 10% of the province s total export volume.
The economic and commercial counselors from Chinese embassies in Pakistan, Nepal, Bangladesh, Afghanistan and Sri Lanka gathered in Chengdu from April 23 to 24 and expressed their views about business opportunities in South Asia.
How could Sichuan expand cooperation with South Asia? The 5 counselors simultaneously put forth the idea of easy access .
How should we make use of geographical advantages? How should we make use of regional trade facilitation mechanisms? How should we establish industrial channels? The counselors had a face-to-face dialogue with our reporters and made some distinctive illustrations about easy access .
Three Georges Dam the Second in Pakistan Made by Sichuan Enterprise
--The industrial outlook of Zhou Zhencheng, Economic and Commercial Counsellor of the Embassy of the People s Republic of China in Pakistan
R (reporter): What opportunities will the Sino-Pakistani Free Trade Zone bring to Sichuan?
Zhou (Zhou Zhencheng): Pushed by the governments of the two sides, China and Pakistan set up an all-round free trade zone, where the two countries have gradually lowered the tariffs of 85% of the total dutiable items of each side and will exempt the tariffs of 36% of the total dutiable items of each side within this year. As a result, Sichuan s commodities, services and enterprises will have more convenient access to Pakistan.
R: What competitiveness does Sichuan have against other provinces or municipalities in the cooperation with Pakistan?
Zhou: Depending on its own industrial advantages, Dongfang Electric Corporation began to contract engineering projects in Pakistan from the 1980s. Ghazi Barotha Dam built by the corporation is called Three Georges Dam the Second and enjoys high reputation in the locality. Abundant experiences in project contracting and mature techniques are just Sichuan s comparative advantages.
Besides, Sichuan may also have intensive cooperation with Pakistan in such complementary sectors as auto manufacturing, biological pharmacy, software development, hydroelectricity projects and electric equipment.
R: In your opinion, how could the western region of China connect itself with Pakistan so as to open the trade corridors from China to South Asia, West Asia and Southeast Asia?
Zhou: Speaking of trade corridors, a related idea is access . The feasibility study for a China-Pakistan railway is being done by Dongfang Electric Corporation. The two countries intend to co-build the railway with Kashgar in Xinjiang as the intersection.
A bridgehead for Expansion into South Asia
--Bai Dongmin, Economic and Commercial Counselor of the Embassy of the People s Republic of China in Nepal, offers his suggestions for China s southward strategy .
R: Nepal will be the breakthrough point for Sichuan s economic cooperation with South Asia. How could Sichuan and Nepal make efforts in this regard in your opinion?
Bai (Bai Dongmin): As one of the least developed countries confirmed by the UN, Nepal is entitled to the generalized system of preferences and other preferential treatments from developed countries. Based on the preferential rules of origin, Sichuan enterprises enjoy a value-added ratio of 30% when opening factories and processing products in Nepal as well as zero tariffs when exporting products to Europe and the US.
Lately the Chinese government has listed the project of the Lasa-Shigatse Railway into the Twelfth Five Year Plan, which will extend the Qinghai-Tibet Railway into Nepal. This year Sichuan s provincial leaders have headed two delegations visiting Nepal, demonstrating sufficient resolution and strategic vision in trade cooperation with South Asia.
R: What fields does the Nepalese business circle favor for cooperation?
Bai: Nepal desires Chinese enterprises to invest in tourism, agriculture and hydroelectricity, while the business circle wishes to promote their distinctive arts and crafts into the Chinese market.
A God-Given Opportunity for Cooperation
--The opportunity outlook of Lin Weiqiang, Economic and Commercial Counselor of the Embassy of the People s Republic of China in Bangladesh
R: 2010 marks the 35th anniversary of establishment of diplomatic relations between China and Bangladesh. What opportunities will that mean for Sichuan enterprises?
Lin (Lin Weiqiang): China and Bangladesh released a joint communiqu in March this year, declaring the establishment and further development of closer all-round cooperation partnership , and signed a series of trade cooperation agreements. This means more cooperation opportunities for domestic enterprises especially Sichuan enterprises.
For example, import from and export to Bangladesh could be enlarged on the basis of preferential tariffs, more Bangladeshi enterprises could be attracted to take part in the WCIETF and Sichuan enterprises could be involved in project contracting in Bangladesh.
China will exempt the tariffs of 4721 items of dutiable products imported from Bangladesh from July 2010, accounting for 60% of the products dutiable by China Customs. Sichuan enterprises can also seize the opportunity to engage in import business in Bangladesh.
R: What fields will prove to have more potential opportunities for Sichuan?
Lin: Sichuan should take advantage of the route from Sichuan through Yunnan to Myanmar and Bangladesh, and establish trade cooperation with Bangladesh in respect of textile and garment, daily consumer goods and project contracting.
A Huge Market with All Sectors Resuming
--Wu Gangchen, Economic and Commercial Counselor of the Embassy of the People s Republic of China in Afghanistan, talks about the business opportunities in Afghanistan s reconstruction.
R: Afghanistan is in truceless chaos. Are there any opportunities for Sichuan? Are there any issues that deserve concern?
Wu (Wu Gangchen): In Afghanistan, all things that have been left undone are to resume. People need all kinds of materials, including electromechanical products, building materials, light industrial products and electric appliances. Presently, the government starts infrastructure construction like railway, road, water supply, electricity supply and fuel. Sichuan enterprises can seek cooperation possibilities in such sectors as energy, construction, trade, service, processing and manufacturing.
To develop business in Afghanistan, enterprises are faced with challenges such as high cost in safety precautions, high cost in production, low work efficiency of the governments and insufficiency in high-quality talents. But there is a huge market in Afghanistan. Currently, we can attract Afghanistan parties by foreign trade to expand cooperation with Afghanistan.
R: How can we attract Afghanistan parties?
Wu: That needs joint efforts between the governments and enterprises. First, governments should use the WCIETF and other trade platforms to attract Afghanistan parties and enterprises follow up any project. Second, access should be set up and improved between the two sides to facilitate commerce. Third, enterprises can enter into alliances with the Chinese institutions that have developed their business presence in Afghanistan to seek cooperation with such institutions.
Plan to Open Direct Flight from Chengdu to Colombo Zhu Jinfu, the Commercial Counselor of the Embassy of China in Sri Lanka, Prospects Bilateral Cooperation.
R: At the end of last year, Sri Lanka established the 3rd consulate in Chengdu. How do you think Sichuan strengthens economic and trade cooperation with Sri Lanka?
Zhu (Zhu Jinfu): China Eastern Airlines Corporation Ltd is planning to open direct flight from Chengdu to Colombo (the capital of Sri Lanka) and then to Maldives. If the route opened, it will play a significant role in promoting and strengthening bilateral economic and trade cooperation. Sichuan enterprises may pay close attention to the production and export of non-traditional products, industrial equipment manufacturing, infrastructure projects, telecommunications, textile production and processing in Sri Lanka.
R: Through which channels can Sichuan enterprises participate in post-war reconstruction in Sri Lanka.
Zhu: After the civil war, the government of Sri Lanka launched cooperation in infrastructure such as transportation, electric power, ports and other focus areas. The reconstruction projects after the civil war are mainly divided into two categories. The first one is international competitive bidding projects, and the second is contracted projects with investment. Sichuan enterprises who wish to participate in international tender bids can get tenders information through local agents or from the local newspaper, commercial sectors of Sri Lanka and other websites.
Sichuan People in South Asia
One meter long billboard is sold at $80 in Afghanistan.
A billboard of One meter long and a half meter wide is sold at $50 to $80. When Xu Shaokun first arrived in Kabul, the capital of Afghanistan, he simply could not believe his ears. In Chengdu, a billboard of the same size only needs 40-200 yuan.
There are big opportunities for small business. Xu Shaokun sees that many people from Jiangsu and Zhejiang have come to Afghanistan to do small businesses, from advertising, retail and other household items to furniture making. Large and small Chinese shops stand lining the streets of Kabul. The Chinese 19th Metallurgy Company which Xu Shaokun serves contracted for a large-scale copper mine construction project in Afghanistan, he was sent by his company to Afghanistan to do construction design last year.
It is very difficult for Xu Shaokun to meet a fellow townsman while he has been in Afghanistan for several months. He says: At least it is relatively safe in Kabul. Many Afghans go to streets with safeguard in arms, but many Chinese businessmen even do not hire a bodyguard. The Afghans are very friendly to Chinese.
Xu Shaokun finds that Kabul has no running water, no design of sewer, no urban drainage and sewerage system. In addition, ZTE, Huawei and others have already become household names in Afghanistan.
Native Workers learn the local Sichuan dialect actively in Bangladesh
After entering Bangladesh in1986, the 7th China Chemical Engineering Construction Co. has almost carried out construction uninterruptedly in Bangladesh for over 20 years. You could say that the whole fertilizer production line of Bangladesh is built up by us. Su Fuqiang, the president of this company says proudly.
In the canteen of Bangladesh branch of this company, the watercress and pickled vegetables eaten by Sichuan staff are all transported here from Sichuan by air and there is an authentic Sichuan cuisine chef. After gaining a firm foothold in Bangladesh, the company began extending the market to Pakistan. Just as the company is busy clearing the language barrier, many native workers learn the local Sichuan dialects actively and it is standard Luzhou accent. Su Fuqiang says with a smile.
The company takes a good care of local staff. Su Fuqiang says with deep feeling that respecting local customs and local staff is the basis for enterprise in foreign country. Bangladesh being one of the 49th least developed countries announced by the UN, construction conditions are harsh, so it is hard for a construction team without solid technical skills to do good projects there.
