This episode covers the resumption of international cruises, with comments from Tiger Young, chair of the European Chamber’s Maritime Manufacturing and Industrial Services Working Group; government plans for establishing a unified national market; and foreign direct investment into China in the first four months of 2023. From the Chamber side, the inaugural Government Affairs Conference will be held on 7th June in Beijing.
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Resumption of international cruise transport (in Chinese):
January-April official FDI data (in Chinese):
Rhodium Group report on European FDI in China:
State Council meeting on plan to establish unified national market:
Government Affairs Conference 2023: Rebuilding Trust for Collaboration
RUI: Hello and welcome to China Shortcuts,
MARIANN: the European Chamber’s weekly catchup on China’s business landscape.
RUI: On 15th May, the Shanghai Municipal Government approved a plan aimed at resuming international cruises from Shanghai’s ports after cruise transport was shut down for more than three years due to the COVID-19 pandemic.
MARIANN: An original pilot plan for the resumption of international cruise activities was issued by the Ministry of Transport at the end of March, with Shanghai and Shenzhen selected to trial the reopening of cruise routes. The newly approved plan details the next stage of restarting international cruises. The Shanghai government also emphasised the need to further develop destination ports, and pledged to build a world-class cruise ship design and manufacturing assembly lane, as well as an Asia-Pacific distribution centre for cruise ship materials in Shanghai.
RUI: Commenting on the resumption of international cruise transport is Tiger Young, chair of the European Chamber’s Maritime Manufacturing and Industrial Services working group.
TIGER YOUNG: In the end of March the government announced the restart plan for the Chinese cruise market, which is of course good news for the whole industry. Right now, they have only two to three Chinese companies that announced their itinerary from Shanghai and Shenzhen to neighbouring countries. For international companies, we might take six to ten months of preparation before bringing our ships back to China. Right now, there are still two major changes lying ahead. The first one: group travel to South Korea and Japan is still not allowed. Number two: online and offline travel agencies are still not permitted to sell the cruise tickets. So, we still need further dialogue with policymakers on such issues.
RUI: At an executive meeting held on 19th May and chaired by Premier Li Qiang, China’s State Council discussed the plan for establishing a unified national market.
MARIANN: The plan entails building a ‘highly efficient, rules-based’ unified national market that seeks to break down local protectionism and market segmentation. While it has been on the table for over a year, the plan has so far only been broadly outlined. Many listed items relate to longstanding issues that had been on Chinese planners’ agenda already and were simply brought together this time under one umbrella.
The State Council meeting highlighted the need for deepening reform and further optimising the protection of property rights, market access and fair competition. These are all welcome intentions, however, the plan has to be followed by concrete action, as that will be key to boosting China’s economic efficiency and attractiveness as an investment destination for international companies.
RUI: According to data released by China’s Ministry of Commerce on 17th May, in RMB terms, the actual use of foreign direct investment grew at the slowest pace in almost three years in the first four months of the year compared to the same period last year.
MARIANN: While the RMB-denominated data showed a 2.2 per cent increase in foreign-direct investment, in dollar terms, FDI actually shrank 3.3 per cent in the January-April period, year-on-year, amounting to 73.5 billion dollars. Without providing the amounts or a comparison, the ministry’s statement also highlighted that investment from France surged to more than five and a half times year-on-year in the first four months of 2023, while investments from the United Kingdom more than tripled in the same period. According to a 2022 report from the Rhodium Group, France and the UK are both among the four countries that made up the vast majority of European investment to China in recent years. In 2021, France contributed 10 per cent, while the UK made up 20 per cent of all European investment into China.
RUI: On 7th June, the European Chamber will be hosting its first Government Affairs Conference, with the theme ‘Rebuilding Trust for Collaboration’.
MARIANN: The conference will provide a platform for exchanging insights and discussing the values and practices of government affairs in China. It will also provide attendees with analysis on current economic and political trends, and explore the challenges and opportunities that foreign enterprises are facing in the China market.
RUI: Join our event to get a better understanding of the broader state of EU-China relations and China’s economic recovery strategy following its reopening earlier this year. Experienced government affairs professionals and senior executives from a variety of industries will share their observations on navigating the current complex political environment and how to advise European corporate headquarters on the best China strategy for business development.
MARIANN: Thanks for listening. Tune in again next week.
RUI: In the meantime, please find useful links in the episode notes.