Strong Positive outlook for Australian business in China
Australians working on the ground in China remain highly optimistic about their business prospects going into the future, writes AustCham Shanghai chairman, Peter Arkell.
So much is written and spoken about China and particularly the Chinese economy and its impact on Australia, yet often these are observations that are made a long way from the day-to-day realities of operating in China. Regrettably, often these observations are not helpful because they are based on a misreading of the China market.
In fact, it can be far worse than regrettable, because investment and business decisions can be made that are based on a skewed view of the real situation in China. It must be difficult for boards to consider their China investment strategy when there are daily reports of “slowdown”, “hard landing”, “negative PMI numbers”.
At times, for those who are on the ground doing business in China, it can seem like there are two Chinas; one that is the world in which we live and work, and the other is in some other universe that is facing sudden disaster.
The Australian business community in Shanghai, and Greater China for that matter, is best placed to take a reading of this market and its outlook. Members of the Australia China business community and their reading of China is based on day-to-day experience in this enormous and complex country and their views should be taken into account for an accurate picture to be formed. They are ideally placed to observe how business for Australian companies is tracking in the current economic environment. For the past two years AustCham and Austrade have taken the pulse of Australian business perceptions in Greater China. The latest survey has recently been released and is broadly available, including on the AustCham Shanghai website (www.austchamshanghai. com).
To have this snapshot, which is specifically enquiring of our Australian business sentiment in China, presents a valuable insight into how we as a business community view the current market conditions and where we might be heading. It also provides a reality check.
The findings are particularly notable for the growth in the optimistic outlook expressed by the respondents. In the first study done in late 2012, we thought that it was remarkable that 69 percent of the respondents had an optimistic outlook for the coming year. A year down the track, that sentiment has become even more pronounced with 83 percent saying that they had an optimistic view of the coming year’s business in China. That was significant also because 85 percent said that they are expecting the level of competition to grow over the coming years. The competitors were expected to be an even mix of Chinese and international companies, yet the positive outlook was based on the prediction that they expect to see the market to continue to grow in China. In fact, of the 77 percent of respondents who said that they expected their businesses to grow in size over the next five years, half of these said that the growth would be required to meet increasing demand in the China market.
This positive business sentiment may not reflect the tone expressed among commentators in Australia as they look at China and the global economy. Yet the findings have reinforced the views delivered in the study last year.
The AustChams in Greater China have a rare ability to tap into the real-time sentiment of doing business in China. Perhaps it says something of those Australians who are engaged on the ground here in China that they have such an overwhelming positive outlook for the next few years.
Australia China Business Awards
In the coming months there will be an opportunity to celebrate these business successes with the Westpac sponsored AustCham Australia China Business Awards; the ACBAs. AustCham Shanghai is hosting this year’s ACBAs and the planning is well underway. For those companies that have achieved success over the past year, this is the time to nominate for one of the categories. Every year has produced an exciting crop of winners and AustCham Shanghai is looking forward to showcasing the latest success stories. Companies from across Greater China should nominate through their local AustCham. ■
*For more information about AustCham Shanghai visit: www.austchamshanghai.com