Current trend in china.

Contents

• Recent Facts about China• GDP growth in China • BRICS Economies• Why China, A favorable Environment for

Multinational Business• MNCs Success stories In China• Current changes

Recent Facts about China

• China current population 1.36 billion• China has more than 170 cities, with population of

average 1 million, • Beijing has 20 million population• A huge market for MNCs• In 2010, China became the world's largest single-country

new-car market, surpassing the US. But the percentage of Chinese who own cars is still only 7%.

• An enormous market for the MNCs to expand their business (National Bureau of Statistics of China, 2012)

GDP growth in China

• China joined WTO in 2001

• Slowdown after 2008 financial crisis

• Even though, China maintains growth of average 10%

• Still there was 62% growth between 2008 and 2011

BRICS Economies

• BRIC is a grouping acronym coined by Jim O'Neill in 2001, that refers to the countries of Brazil, Russia, India and China, which are all supposed to be at a similar stage of newly advanced economic development

• According to Silk Road Associates, Chinas economy is larger than the economy of combined Russia, India and Brazil

• China’s economy has grown by $1.5 trillion in past two years.

China, A favorable Environment for Multinational Business

• Highly favorable environment that offers low labor costs

• Strong infrastructure• A rising level of education• Increasingly skilled labor• Government incentives to attract FDI in

the country

• Red represents data of 2005

• Grey Represents data of 2010

• According to the 2012 China Business Confidence Survey conducted by Roland Berger and the European Chamber of Commerce in China, 74% of European MNCs view China as increasingly important to their company's strategy,

MNCs Success stories In China

• Volkswagen opened two new plants on 2013 (both financed by revenues from its China ventures) and Ford will open three by 2014.

• Coach, a premium US accessory maker that saw its sales in China double in 2010 to US$100m, says it aims to raise its revenue in the country to US$500m by 2014 and secure a 10% market share in its sector.

• Unilever is aiming to boost sales five- fold to US$10bn by 2020• Coca-Cola is just finishing up a US$3bn investment

program and is planning to spend US$4bnmore over the next three years and many more.

Success Stories

The current changes• China seems nearing end of unlimited labor from rural areas at

low costs• Labor shortage as a result it will increase in industrial wages• Regulatory constraints in areas such as labor law, standards,

and environmental protection are becoming increasingly comprehensive and more strictly enforced.

• China is transforming from emerging market to mature market• Domestic market are growing stronger and MNCs have to

compete with them