China’s sterling and high economic growth and its growing influence to the world economy have increasingly attracted great attention. In 2006, China’s GDP amounted to 20.94 trillion Yuan (USD2.7 trillion), up by 10.7% from the previous year, making China the world’s 4th largest economy. Foreign trade increased by 23.8% to reach USD1.76 trillion and yielded a record trade surplus of USD177.5 billion, up from the surplus of USD102.00 billion in 2005.

Hence, China’s dominance in world trade has now given rise to global fascination with Chinese business opportunities with each passing day. The reverberations of the country’s development are being felt everywhere, from European consumers wearing clothes made in China to US factories moving here. And of course the Chinese themselves want foreign goods, services and know-how. There can be few industries or businesses worldwide without a China angle.

China is modernising – above all, China is urbanising. This creates a need for more jobs, often new and different kinds of jobs, and infrastructure, housing, roads, power plants, offices and all the rest. This investment is one of the major drivers for growth. The other driver is consumption – people are becoming richer and more sophisticated, and buying more and different products and services. In addition , China is very open to FDI.

Trade and investment relations between Malaysia and China have come a long way since the establishment of diplomatic relations 33 years ago. Malaysia is currently China’s 6th largest import source and the 16th largest export destination in the world. It is also China’s second largest trading partner among the ASEAN member economies , registering more than USD37 billion trading volume in 2006. At the same time, Malaysia’s investments in China are also on the rise, with many more Malaysian companies now venturing into China to invest. As at the end of 2005, Malaysia’s investments have surpassed the USD3 billion mark.

The booming economy of China amounts to loads of business opportunities for Malaysian manufacturers and exporters. In view of the dynamic economic performance of China, there are excellent export opportunities for potential Malaysian products penetrating into the lucrative Chinese market.

Some of the investment options Malaysian businessmen can look at include the setting up of representative offices, JVs, and wholly-owned foreign enterprises (WOFEs) as well as mergers and acquisitions which are becoming increasingly popular. People are not getting involved in China simply because it is fashionable – there must be a real business case and the venture must make money. But it is not just about setting up a company. There are subtleties and complexities that do not exist elsewhere. China’s regulatory system is developing as she fulfills her WTO commitments, and people need to keep on top of these.

There are risks and challenges. China is still a developing country and its level of development should not be overestimated. Things do not always work the way you expect them to, like in Malaysia. There are still significant weaknesses in infrastructure – power outages still exist , and moving goods around can be , to say the least, challenging. In this regard, China still provides great business opportunities for Malaysian entrepreneurs due to its market size and development potentials. It is therefore important that we continue to foster and strengthen trade and investment relations with China as part of our efforts to diversify abroad. MASSA can certainly complement the efforts undertaken by the Malaysian Government in these areas, and serve as a platform for successful Malaysian businessmen in China to network among themselves.

Country Statistics : China

Here are a couple of success stories from the many Malaysian companies who have made it big in China.

Shanghai Winner Electrical Co. Ltd.
Since its inception on 8 August 1994 in China, Shanghai Winner Electrical has grown from a small engineering outfit into one of the key players in the industrial automation industry in China. It provides automation and drive solutions for a wide range of process and non-process industries such as machinery, metals, power, mining, cement, petrochemicals, pulp & paper, rubber, textile, shipbuilding and waste & waste treatment.

The company specialises in the R&D of Intelligent Industrial Control Management System (IICMS) which includes the design of electrical drives and automated systems. It is also involved in intelligent field instrumentation, industrial engineering design, customised software programming, engineering and production, installation and commissioning as well as comprehensive maintenance, support and training.

Shanghai Winner Electrical has received prestigious ISO 9001, CE and CCC approvals, in addition to the highly regarded Siemens Core Partner award in China. Apart from its headquarters in Shanghai, the company has 2 branches, one each in Beijing and Nanjing, and 4 representative offices in Ningbo, Wuxi, WuHu and Wuhan respectively.

Willsonn Partners (WSP)
Willsonn Partners (WSP) is a CPA-based multi-disciplinary consulting firm in Shanghai & Beijing with liaison offices in Guangzhou, Hong Kong, Malaysia and Singapore. Founded in March 2003 by Mr. William Leong and Mr. Sonny Khong, the company provides a wide range of services such as corporate advisory, accounting BPO & audit services, HR BPO & instant office services , transaction advisory & risk assurance services and tax advisory services. Additionally, the company also conducts professional qualification courses such as ACCA, CIMA, AAT (Association of Accounting Technicians) and CAT (Certified Accounting Technician).

WSP is a member of the JHI International CPA network which has 160 members worldwide in 55 countries. The company currently employs 8 foreign managers and a total of 40 staff, of which 15 are qualified CPAs, registered tax agents, lawyers and HR consultants , serving over 400 clients.