The weather isn’t the only reason luring more and more foreign businesses to Xiamen. Sophie Loras spoke to AustCham-Fujian chair, James Rein, about the business opportunities in the region.
Xiamen in Fujian province may not have as many millionaires as Shanghai and Beijing, but it certainly has better weather, brand new infrastructure and boasts one of China’s largest deep-water ports. Located on the southeastern Chinese coast, the city overlooks the Taiwan Strait and prides itself on its mild and subtropical climate as well as its reputation as a logistics hub between China and North-East Asia, Southeast Asia, and Taiwan.
It is for many of these reasons, that James Rein, the current chair of newly formed AustCham-Fujian, chose to base his China ventures out of Xiamen over the bigger cities of Shanghai and Beijing when he first arrived in China in 2004, first with a coffee business and in 2009, his wine distribution business, Oz Cellars.
“Xiamen is a beautiful city, it’s very modern with a high disposable income,” says James.
“People who’ve made good in second and third-tier Chinese cities often end up migrating to Xiamen – there’s a lot of development but no industry on the island, which means a lot of very clear beautiful skies, brand new modern office spaces and a high distribution of income and standard of living amongst its populace.”
Fujian has a long, historical reputation as a global trading hub, with many overseas Chinese having, through history, migrated from the region.
“They are the ones who went out into the world, and they are the ones who brought the world back to China,” says James.
With China connections on both sides of his family – via famous brother-in-law, Australian Foreign Minister Kevin Rudd, and his Hong Kong wife’s mainland connections in Jiangsu and Fujian provinces, China had been on the Rein family radar for a long time.
James’ wife Lina formed the AustCham-Fujian & Xiamen Australian Investment Association in April 2009 to respond to the growing number of Australian and Chinese- Australian businesses setting up business interests in the region.
“When foreigners come to China there is a need to talk to people, learn the tricks of the trade without having to pay for it, and without making mistakes,” says James, who believes many Australians come to China for the first time with blinkers on.
“Many Australians in joint ventures still don’t cross the T’s and dot the ‘I’s when they come to China. They don’t do due diligence as you would in Oz and they get into a lot of trouble,” he says.
AustCham-Fujian’s aim is to better promote the interests’ of Australian business in the region and work in co-operation with the extended AustCham China networks in Shanghai, Hong Kong & Macau, Beijing and South China. It already represents the interests of almost 50 businesses covering a range of industries including manufacturing, property development, investment, international trade, energy and resources, the service sector and logistics.
“In today’s modern world and with electronic business, it is not difficult to get to Shanghai, Beijing, Chengdu. Everything is close,” says James of life in Xiamen.
Endorsing Xiamen as a multinational business hub are companies such as Dell, ABB, Kodak and Lenovo, who have all set up their headquarters in the coastal city.
James Rein’s advice to companies looking at China, is to not automatically think of Beijing and Shanghai when exploring options.
*Pictured right: James and Lina Rein.
“Yes they are very interesting cities and you don’t need a great deal of Chinese language
to live and work there, but for the true China experience you need to get out,” he says.
“It’s an extremely competitive market – whatever the industry – so in China start in the second and third tier cities, establish your name and good volume.”
He says China’s second and third-tiers cities are thirsty for foreign investment.
“They are incredibly welcoming from both a business to business point of view and a government to business point of view.
“Living here in China is a great lifestyle, and if you work hard you can have a very good business as well as opportunities which are 100 times greater than at home.” ■
For more information visit: www.austcham-fujian.org
FUJIAN FAST FACTS
Area: 121,400 km2 (about half of the U.K.) Capital: Fuzhou Population: 36.04 million Population growth: 6.3% p.a.
Main languages: Mandarin, Hokkien, Hakka 2009
GDP: RMB1,195 bn (A$192 bn)
GDP growth rate: 12% (2000-2008 average: 11.8%)
2010 GDP target growth: 9% 2009 GDP per capita: RMB33,051 (A$5,330)
Trade: Merchandise exports US$53 billion, Merchandise imports US$26 billion
Main trading partners: USA, Hong Kong, Taiwan, EU, Japan, ASEAN
Trade with Australia: Export to Australia US$867million, Import from Australia US$518million
Major Australian exports: Iron ore, Coal, Niobium, Aluminum plates, Barley, Wine
*Source: Australian Consulate General Guangzhou