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China is the world's second largest economy by nominal GDP (RMB 74.4 trillion ≈ USD 11 trillion in 2016) and the world's largest economy by purchasing power parity. China has been the world's fastest-growing major economy, with annual growth rates averaging 10% over the past 30 years. The sheer size and the sustainable growth of Chinese economy spells significant opportunities for businesses around the world.

People source from China because it is the largest manufacturing economy in the world. As long as there is a demand for something, supplies with competitive prices and quality can always be found in China. Moreover, as a global hub for manufacturing, industrial clusters are well developed in China, which means if the final product (a car for example) is composed of various parts, most likely you can find suppliers of all these parts without leaving the country, that is, a one-stop shopping for your sourcing efforts. As the largest merchandise exporter in the world, Chinese exports amounted to RMB 13.84 trillion in 2016.

People sell to China as well because it has the largest real purchasing power in the world. If you are interested in B2B transactions, there are tens of millions of running enterprises in China, which are actively seeking business opportunities and partners. Or think about its population of more than 1.3 billion if you are engaged in B2C transactions. China’s household income is huge, presently above USD 5 trillion a year. That makes China the second largest importer of goods in the world and world's fastest growing consumer market. China imported goods of RMB 10.49 trillion in 2016.

Moreover, China has committed itself to sharing its growth and prosperity with the rest of the world through trade, investment, and cooperation. For example, China has signed 14 Free Trade Agreements (FTA) with its major trading partners such as Australia, Korea, Switzerland, and ASEAN countries etc., and even more FTAs are under construction. Another example is the “Silk Road Economic Belt and the 21st-century Maritime Silk Road” initiative, better known as the One Belt and One Road (OBOR) initiative, proposed by China in 2013, which focuses on connectivity and cooperation between Eurasian countries with a China-centered trading network. By 2016, China’s investment in the OBOR countries has surpassed USD 50 billion and China will contribute even more in the coming years.

Economic operators act on these opportunities. However, despite all the positive factors discussed, to reach and transform Chinese opportunities into real profits is not an easy task in practice. China differs from other economic hubs in many aspects such as language, legal framework, and business etiquette etc. Businesses will have to face plenty of challenges and difficulties along the way.

For instance:

  • China restricts or even prohibits the trade of certain commodities by legislation. Do you know the scope of these restrictions or prohibitions?
  • There are a number of licenses imposed by various Chinese authorities on the import and export of certain products. Are you aware of these licenses and their licensing formalities?
  • China Customs and other border agencies have complicated legislation and stringent enforcement. Do you have the essential knowledge about how to comply with the laws and regulations pertaining to import and export?
  • Are you able to classify your products correctly in terms of Chinese Tariff?
  • How do you price your products and what are the duty and tax consequences of your pricing behavior?
  • How do you stay current with the frequently changing regulatory requirements?
  • How is the performance of your logistics? What are the bottlenecks? Is there any time-saving or cost-saving opportunity?

The question list can easily go long. But no matter how long your question list is, our expertise and experience will bring you the answers in a timely and cost-effective manner.

Every business is unique and has its own preferences for partners and forms of cooperation. With twenty years of hands-on experience in import and export, we dedicate ourselves to facilitating your trade with China in all possible ways. From a project-based or retainer-based consultant to a more deeply involved and risk-sharing agent, our flexibility and commitment to client excellence is witnessed in all our services.

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