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Why should you do business in China?

By 11 April 2019June 3rd, 2022No Comments

We explain why you should do business in China before anywhere else. In the following lines, we talk about the current state of one of the greatest economic powers in the world, the leading country in imports and exports.

China is the most populated country in the world with more than 1,400 million inhabitants, which for you may be potential clients. In this country millenary culture coexists with modernization, its inhabitants dedicate themselves to progress, and therefore, it is already one of the world’s leading economic powers. And especially for its investments and the export of products abroad.

It is a country of opportunities, increasingly open-minded: now it looks to the European continent to do business exchanges. For something, it is the third country that invests the most abroad and imports have skyrocketed. This is where Spain can play a fundamental role, as its culture, landscapes and potential make it an attractive country in the eyes of the Asian giant.

“During our years in China we have discovered that Spain is a great unknown in China, it even sounds exotic to them. We believe and we are sure of the great potential that the Spain Brand has there, we have many similarities with them, especially in the importance of gastronomy and family ”, explains Fran González, CEO of Kalea Group, consultancy that establishes bilateral professional relations between China and Spain.

From factory to the world to technological king

Until recently, China was, above all, the world’s factory. Western countries maintained relations with it for its production advantages. In 2001 he joined the World Trade Organization, which had a significant commercial impact. It is no longer the ‘all for one hundred’ of cheap and lower-quality products. Now, ‘Made in China’ is more sophisticated. It is the main commercial power in the world and also in terms of electronic commerce.

It also excels in cutting-edge technology. In its bid to transform its industry, it is the second country that invests the most in R&D, and is already leading in the artificial intelligence, robotics or telecommunications sectors. China has its own ‘Silicon Valley’, Shenzen, which together with Quanzhou, Macao and the financial hub of Hong Kong, have made this country what it is today and in a dizzying time. In fact, Shenzhen, once a land of rice fields, had 30,000 inhabitants in 1980, while today it has 15 million.

China has its own ‘Silicon Valley’, Shenzen. In 1980 it had 30,000 inhabitants, while today it has 15 million.

In 1978 China represented only 1.8% of world GDP, now it represents 17.9%, surpassing the Eurozone, only behind the 27.3% of the US This country has little left to be the first world power, and that can only come from the hand of commercial relations with the outside.

The entrepreneurial spirit of its population, the commitment to innovation of its government and companies, has resulted in a large increase in the purchasing power of the population, and an increasingly relevant middle class made up of around 400 million people. More than 500 million people have left poverty behind, and per capita income has grown from $ 156 to $ 10,000.

China’s relations with Spain

Trade relations between China and Spain date back to the 16th century, when the Spanish empire used the Chinese sea route to transport goods. Although it was in 1973 when the two countries signed a diplomatic alliance in Paris. Relationships that were strengthened with the arrival of the Comprehensive Strategic Association Agreement in 2005.

The barriers that you will find doing business in China

As we have said, the new and the old go hand in hand with harmony in this territory. You cannot try to establish relationships with your entrepreneurs without understanding that although it is a country without an official religion, it is a deeply spiritual place, partly because of Confucianism. You also have to understand their cultural peculiarities to build fluid and productive relationships. And it must be taken into account that only a percentage of its inhabitants speak English, so it is important to have someone who speaks Mandarin before trying to enter your market. In addition, the government exercises strong control over everything that is done in the country, which involves more bureaucracy than usual. For all this, we recommend that you hire a consultant.

Kalea Group, your consultancy in China, we can help you break down these barriers so that you can achieve your goals with the country everyone is talking about.