How do you assess the outlook for China’s economy?
There have been a lot of interesting developments in China’s economy lately, such as the tightening of liquidity in the market and controlling the so-called ‘shadow banking’ practices. But the new leadership of China appears to be in good control of the economy and its development towards a more sustainable model of growth. GDP expansion slowed to 7.5% in Q2 but the general outlook for the Chinese economy is still excellent, particularly in comparison with the rest of the world.
What are the main advantages of working in China?
It is a country with very good infrastructure and a consistent supply of skilled labour. While many questioned the one party system and the tendency towards ‘macro’ control from the government, its commitment to maintain stability and its overall effectiveness in maintaining growth still provide the best opportunity for global businesses. The ever increasing purchasing power of the general population in also crucial for corporations looking to expand their global revenue base.
What should business leaders be aware of when investing in China?
International businesses looking to invest in China need to be appreciative of the different culture —particularly local values and business protocols. Also, China’s regulatory requirements bring an additional layer of compliance requirements. Business leaders need to find knowledgeable advisers to help interpret the differences, bridge the gaps and facilitate entry into China. Localisation also needs to happen along the way to ensure long-term sustainability within China.
Stanley Chang is Global business risk leader at Grant Thornton.
Discover more about investing in China on the Grant Thornton China website.