China Multinational corporations in the retail and travel industries say they are optimistic about the prospects for growth in China in 2023.
They said their confidence in China is high, as the country had optimized its Covid-19 response measures while consumer demand has rebounded.
Norwegian-American cruise line operator Royal Caribbean International said China’s easing of Covid-related entry restrictions in January had prompted Chinese tourists to book cruise trips abroad, especially in Southeast Asia, with the company recording a ‘high level’ of bookings.
Royal Caribbean said it is “fully confident in the growth potential of the cruise tourism market in China”, saying it expects to see the market grow further in the second half of this year.
According to a trade expert, China has shifted the emphasis from investment and export-driven development to consumption-led development.
Bai Ming, deputy director of international market research at the Chinese Academy of International Trade and Economic Cooperation in Beijing, said: “China is building a new development pattern and promoting high-quality development, and the country’s economic growth shows positive prospects, offering new opportunities for the growth of global companies, especially consumer goods retailers.
“This year, China’s market growth potential has been harnessed at an accelerated pace, and foreign companies are actively tapping the market demand and speeding up their investments. This further reflects their confidence to grow their business in China,” Bai said.
Multinational consumer goods company Unilever, which has been operating in China for 100 years, plans to continue to increase investments in China.
At its new $106 million ice cream plant in Jiangsu province the company has introduced more digitalization and smart production techniques in order to expand its product range.
“China has been the largest global market for two kinds of Wall’s ice cream. We have expanded e-commerce sales and the delivery business of ice cream and strengthened digitalized marketing in the country,” said Benny Xu, North Asia general manager of Unilever ice cream.
And Italian confectioner Ferrero said it believes consumption will continue to be the mainstay of China’s economic growth this year. The company’s data showed the its sales in China had bounced back since December 2022.
“During the Spring Festival holiday this year, we saw a strong momentum of consumption recovery as reflected by our outstanding business performance. The robust spending during the Chinese New Year suggests growth this year will be promising,” said Mauro De Felip, general manager of Ferrero China.
“With China’s optimized Covid-19 response measures, we are optimistic about China’s consumer market and the confectionery industry this year and beyond. Thus, we are more confident about our business growth in China and will further increase investments by developing more portfolios and implementing all-round digitalization strategies to satisfy consumer demand,” said De Felip.
China multinational corporations warning over ‘Big Four’ firms
Chinese authorities are urging state-owned organisations to stop working with the four biggest international accounting and consultancy firms – PwC, Deloitte, EY and KPMG.
They cited concerns about data security, even after Beijing reached agreement to allow US audit inspections on Chinese firms listed in New York.
China’s Ministry of Finance is among government entities that gave guidance to some state-owned enterprises in January, urging them to let contracts with the Big Four auditing firms expire, the China Daily website has reported.
While offshore subsidiaries can still use US auditors, parent companies are being urged to use the services of local Chinese or Hong Kong accountants when contracts come up for tender.
China is seeking to rein in the influence of the US-linked global audit firms and ensure the nation’s data security, as well as to bolster the local accounting industry, the people said. Beijing has been giving the same suggestion to state-backed firms for years, but recently re-emphasized that companies should use other auditors than the Big Four, the people added. No deadline has been set for the changes and replacements may happen gradually as contracts expire.