The Arrow
A new business, economic and financial supplement, from The Archer
Businessweek
Discover where Wales stands in the global economic stage today
Wales seeks business links with land of awaking lion
By Annie Yang
Chinese restaurants and supermarkets are a familiar sight in Cardiff, allowing the growing number of Chinese students as well as locals to enjoy the taste and atmosphere of China.
But these highly-visible businesses are part of a less obvious growth in a widening range of two-way investments between China and Wales.
Investing in Wales has created opportunities both for these owners and Wales. For owners, it is an effective way to immigrate to the UK. For Wales, not only people can enjoy a traditional Chinese cuisine, but the country itself may benefit from international investments.
And Wales has many arguments in order to attract foreign investments. Wales presents many advantages such as the proximity to UK hubs and European marketplace, industry networks and industrial property and exceptional quality of life.
As the Euro China Investment Corporation (ECIC) said: “Cardiff provides a superior alternative to London locations due to its unique combination of a highly skilled workforce and low premises overhead.”
Also, Welsh companies are motivated to invest in China. Michael Thomas, manager and China business adviser of the China-Britain Business Council (CBBC) in Wales, told The Archer: “China has a number of advantages when compared to other large developing markets such as India when it comes to investment. It has by far the largest number of manufacturing regions so it makes sense to set up close to these if you are in the manufacturing sector.
“Other advantages include the rapidly improving infrastructure. Billions of yuan are being spent on airports, seaports, high speed railways and super highways. Moving goods around and from China is becoming easier all the time.”
"China has a number of advantages when compared to other large developing markets such as India when it comes to investment It has by far the largest number of manufacturing regions so it makes sense to set up close to these if you are in the manufacturing sector."
Michael Thomas, China-Britain Business
Council, Wales
Wales is encouraging companies to benefit
from China's developing economy.
Annie Yang examines the investment environment for the Wales-China connection
Wales and China tightening business connections
The Export Week has been announced by the UK Trade & Investment (UKTI). This high-profile event will be in every corner of the UK, promoting exporting to businesses. Lord Green, Minister of State for Trade and Investment, said: “It’s a tremendous and very important opportunity to learn more about the exciting markets that are around the world market which create so many opportunities to British companies.”
Wales will organise five different events starting from May 13 with discussions about business opportunities in China, called China: Unbreakable Business Opportunities.
“Wales does have considerable knowledge and expertise in renewable energy and sustainable technologies and there are more and more niche companies looking to China's high streets as a potential destination for their products,” Mr Thomas told The Archer.
These seminars will enable Welsh businesses to find out business opportunities in these markets. Companies can speak to experts and learn how the Welsh Government can assist them in developing international trade.
China represents huge markets and a very large population. Chinese emerging middle classes want to communicate and interact more and more with developed countries like Great Britain. They are looking at international markets to find out what worldwide markets can offer to them.
“There are also ambitious plans in all of these countries for infrastructure development, roads, railways, airports, hospitals, schools and again the opportunities for British companies to engage in all aspects, helping them realise their infrastructure plans are tremendous,” said Mr Green.
These infrastructure projects provide a great many opportunities where Welsh companies of all kinds in a variety of areas can enlarge their businesses by engaging effectively with the international markets.
The domestic market in the UK is growing slowly and exports have been increasingly important. The sterling exchange rate has caused people’s concerns about investing in Wales.
Dr Zhirong Ou in Economic Section of Business School of Cardiff University told The Archer: “From a short term, the rising exchange rate of RMB (the Chinese currency) will motivate Chinese businessmen to invest abroad. However from a long term, they will consider the exchange risk as when they need to exchange ponds into RMB, they have to face loss.
“People are encouraged by the rising exchange rate of RMB as they can spend less money to invest in a foreign country. But after they earn pounds in Wales, if the rate continues to go up, when they need to change pounds into RMB, their profits will decrease,” said Dr Ou.
“The exchange rate may impose potential barriers to invest in Wales,” Wanbo Zhai, a MBA student of Cardiff University told The Archer. Zhai is looking for business opportunities in Cardiff, which will encourage him to become a British citizen.
“For international investment, exchange rates should be greatly considered,” he concluded.
"Wales does have considerable knowledge and expertise in renewable energy and sustainable technologies and there are more and more niche companies looking to China's high streets as a potential destination for their products."
Michael Thomas, China-Britain Business
Council, Wales