Why You Should Do Business In China in 2022?
Written by: pTranslate Contributors
THE GLOBAL ENTREPRENEUR | BUSINESS
We can be optimistic about the recovery of the world’s economy, as our vaccination programs have seen considerable success. Once normalcy is established, we can expect China to become one of the most attractive investment destinations. While other countries are still struggling to find stability in their economies, China is already preparing itself for foreign investments with continuous improvements to business and the regulatory environment.
As an investor or a business owner, this is an amazing opportunity for you to seize and establish your presence in the Chinese market.
With about 1.4 billion potential customers, constantly growing markets, exciting business environment, numerous regulatory reforms, foreign businesses can have a fairly easy time competing with domestic businesses.
In 2022, China is going to be quite a promising market for businesses worldwide, and we will explore why it is so in this article.
1. China is the second-largest economy in the world
China is the second-largest economy in the world, and it is growing at an incredibly fast rate.
There is huge potential in this country in the next decade. China is believed to surpass the US by 2030. However, due to COVID-19, the takeover could happen even much sooner.
China is already a highly developed country with tons of opportunities for businesses worldwide. It has a great physical and technological infrastructure, allowing all companies to easily connect with other countries in the region. With the fast development rate it has currently, China definitely is going to be even more open to international businesses.
2. Favorable government policies
The Chinese government is very supportive of entrepreneurial pursuits. Both local and international companies can receive favorable benefits and tax exemption if they invest in projects in socioeconomically struggling regions or fast-developing sectors. These include the high-tech sector and the manufacturing industry.
The tech infrastructure in top-tier cities: Shanghai, Beijing, Guangdong, and Shenzhen, is world-class, making it almost effortless to set up and manage tech businesses in these regions. There is also an abundance of high-quality talents always ready to contribute great value to your company.
3. High-skilled talents
Chinese people are very talented, especially young professionals. They are competent and more integrated into the global economy. English has also been incorporated into the Chinese compulsory curriculum, allowing young Chinese to have an easier time working for multinational companies and communicating with foreigners.
Chinese people and Asian people, in general, are praised for their aptitude in the natural sciences, and the stereotype is true, in a way. Coupled with their ever-improving English skills, young Chinese are really competitive in the global markets. You are likely to find a qualified, talented, English-speaking Chinese professional who can bring a lot of value to your company, especially when your company is located in the top 4 cities.
4. Stability
Chinese is in the most stable and prosperous period ever since the start of the last century. The 20th century was indeed a tumultuous time for the entire world, but it was considerably much harder for China. It went through tons of wars, revolutions, famines, reforms, and a lot of upheavals. China today has undergone so much change, and the stability it now has is something the Chinese people haven’t seen for so long.
When speaking of stability, we mean social, economic, and political stability. China is doing fairly well in all 3 respects. Although life in rural areas of China is not that great, and there are a lot of dark sides to life in China, it’s at least the best that people can ask for. Most importantly, investors and entrepreneurs love stability.
The most obvious benefit of stability is predictability.
No one wants high risk. If the risk is high, it must have a high reward. The old China was high-risk and low-reward, which is very unfavorable. Luckily, today’s China brings high rewards at average risk to those who have a competitive advantage. The predictability offers some comfort for foreign companies, allowing them to develop strategies more easily.
5. China is filled with opportunities
The rapidly developing economy means that there is a growing demand in almost all industries. The massive population of China demands a massive supply of goods and services that are highly personalized. In other words, China wants more foreign businesses to enter and introduce their products to the Chinese people.
That’s not to mention the fact that China is constantly encouraging innovation in the country. It is the huge scientific and technological funding that drives the development of China in the last decade. Tech entrepreneurs can thrive in China, more than anyone else.
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6. China has a strategic location
China is located in a promising region.
In the East, there are Hong Kong, Taiwan, and Macau. All of these 3 regions are very developed and open economically. If you set up your business in Shenzhen or Guangdong, you will gain access to those regions, as they are only a few hours flying apart. You can easily reach Korea and Japan too, which are the other 2 major superpowers of Asia.
In the South, China meets Southeast Asia – a rapidly-developing region with unique culture and tradition. This region receives massive foreign direct investment in recent years, and the labor cost here is relatively low.
Setting up your business in China is a sound strategic move if you want to expand further into other Asian countries.
7. China is very welcoming to foreign brands
China people want to experience the Western life. To them, the West is something that is completely opposite to the way of life, and they want to know how different it is. This attitude is not uncommon in Chinese people. They are welcoming of foreign brands. If foreign brands express an interest in and show respect for the Chinese culture, people will be even more willing to try out the products and services that they offer.
Conclusion
China is indeed an interesting market to explore, but there are challenges that aren’t easy to overcome. With determination, effort, careful research, and a little bit of time, you’ll still be able to crack the China code. It’s all about familiarizing yourself with the unique and one-of-a-kind business environment in China.
Do you have experience in doing business and marketing in China? If you do, feel free to share with us your thoughts! We’re eager to hear a few thoughts from you.
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