Since ancient times, China has played a dominant role in world economy. After a temporary decline China is now about to resume its historical position.
World economic history as % of global GDP since year 1, (facts from Agnus Maddison, Historical Statistics of the World Economy: 1-2008 AD)
Business and entrepreneurs
Shortly after the economic reform and open-door policy (改革 开放) was launched by Deng Xiaoping in December 1978, extensive foreign investment started up, resulting in vast interest in western products, technology and management.
"To get rich is glorious" (致富 光荣), a quote by Deng Xiaoping (summer 1992), which gave further stimulus to the already upward economic trend. The WTO membership in December 2001 was a signal to act globally, which resulted in even stronger economic growth. The world's most powerful business culture, and entrepreneurship that is inherited in the genes of many Chinese ensuring that business opportunities are hardly ever missed.
China's GDP growth, (data from National Bureau of Statistics of the People's Republic of China)
After joining the WTO, more and more Chinese companies operate worldwide: Lenovo, ZTE, Huawei, Haier, Geely, Chery, the list gets longer and longer as the Chinese large companies find their markets, partners, or acquire companies in the West. The network of subcontractors follows the same trend. Media frequently write about a great interest in Swedish industry, "Sweden's attractiveness lies in our reputation as a transparent, investor-friendly and high-tech country with multinational companies and great competence." (DN, 2011-01-24)
Urbanization - big demands
XiaoKang family (小康 家) is a traditional measure of the prosperous family in China. XiaoKang-families require a well functioning society, ranging from infrastructure and availability of commodities and services to schools and entertainment. With the fast urbanization the XiaoKang-families rapidly increase in number, and many related market segments almost explode. The dollar millionaires also increase very fast, and with them the demand for luxury commodities.
China's urbanization, (facts from www.un.org)
Need for rationalization and care of elderly
The one-child policy (计划生育 政策), for a long time on the agenda, was started up in 1979 as a temporary solution of an urgent population problem, among other things to get enough food for the rapidly growing population.
The uneven population distribution will result in labor shortages and difficulties to care for the elderly. The population pyramid is similar as in Sweden, but 143 times the population. In rural areas there is a large migrant workforce, which partially compensate the shortage of workers in large cities, which already is the case in Shanghai. In the long run labor will be more expensive, resulting in need for rationalization in industry and for more efficient management, to enable the industry to remain competitive. Care of elderly needs to be extended, where traditionally children and family provide care for their ageing relatives.
China's population pyramid (U.S. Census Bureau, International Data Base)
Opportunities and hidden threats
Since 1984 I lived and worked in China, first as a foreign student and technical attaché, and then at a number of company executive and project management jobs. As a general manager, I built up and fine-tuned a Swedish subsidiary in China for the Chinese market. I was literally standing in the Chinese mud as the project manager for a large industrial construction project. Most recent I was the technical director, including construction and technical startup, of the Swedish pavilion at EXPO 2010 in Shanghai.
I have followed and in some parts been a small part of the Chinese miracle. Mostly, I have served as the only non-Chinese person, without need for interpreter, and built up a very close relationship with my staff and partners.
I recently returned to Sweden, and will happily share with you my knowledge, my network and my expertise about business in China. It is easy to identify major opportunities but there are also many obvious and even more hidden threats.