Opportunity knocks for US businesses
Updated: 2013-10-11 10:49
By Yu Wei in San Francisco (China Daily)
China-US business experts in Silicon Valley believe that China's reforms and development under its new leadership will provide "enormous" opportunities for US companies, as long as they are carefully taking notes.
"This is the year that our president announced to the world that in the next five years, China is going to import $1 trillion from the outside, and invest $500 billion to outside," said Xia Xiang, commercial counselor at the Chinese consulate in San Francisco.
Speaking at a panel discussion called Opportunity for Silicon Valley — China's New Ruling Body hosted by China Silicon Valley, a non-profit organization committed to promoting investment and business cooperation between China and the tech hub, Xia said that investment from China to the US was gaining momentum.
"Chinese direct investment in the US from 2000 to 2012 has amounted to $22.6 billion," he said.
Xia said the Chinese government is pursuing more solid, intensive and cleaner growth, citing many policies and measures to protect the ecological environment by reducing greenhouse gas emissions.
Last month, Xie Zhenhua, vice-minister of the National Development and Reform Commission, and California Governor Jerry Brown signed a climate change agreement to cooperate on clean energy, lowering carbon and reducing greenhouse gas emission. Xia said the agreement between China and California is an attempt to deal with energy efficiency and pollution in China since California is a pioneer in the area.
Another area Xia thinks deserves particular attention is tourism. About 1.5 million Chinese tourists visited the US in 2012, US Department of Commerce data shows. "Last year, two-way tourism reached more than 3.5 million, which means there are 10,000 tourists busy shuttling back and forth across the Pacific Ocean everyday," Xia said, adding that the high travel demand is driving more airlines to offer direct flights between the two countries.
Thomas Shoesmith, a partner at Pillsbury Winthrop Shaw Pittman, listed seven priority industries that China has focused on: energy conservation and environmental protection, new energy sources, clean energy vehicles, biotechnology, new materials, IT and high-value manufacturing.
"It almost looks like the list of things that Silicon Valley companies are interested in," Shoesmith said. "We have now seen a real convergence of objectives between what Silicon Valley companies are doing and what China now wants to invest in, and I think that is great."
Last year, Chinese foreign direct investment in the US hit record levels as the country concluded deals worth $6.5 billion, an increase of 12 percent from the record $5.8 billion in 2010, according to a report by the Rhodium Group.
Another topic that has been brought up constantly is China's new free-trade zone in Shanghai, which is considered by many as China's new reform and opening-up strategy.
Nicholas Hope, director of the Stanford Center for International Development, said foreign companies could benefit from the free-trade zone in Shanghai, although he is still trying to work out exactly how the regulations will be written and what will be permitted.
"If foreign companies can decide what we want to do, if people can simply come in and register and put down their capital and say ‘I'm going buy this building and we are going to bring our Chinese-speaking foreign national in to run this company', I think you will see tremendous interest from foreigners," Hope said. "But that doesn't mean that they are all going to come, because they will only come if they perceive there will be business to transact.
"The question is what demand is going to be in the free trade zone for the services and that did raise some of the issues as to what extent is the zone a stepping stone to the rest of China, or is it a large regulation-free zone that allows you to send services and goods back to the national economy," he added.
Contact the writer at Yuwei12@chinadailyusa.com