Queensland Open for Business – China Market Brief8 October 2015
ZIJIAN ZHANGTrade & Investment Commissioner for China
Contents
• China Market Spotlight
• Trends and Opportunities
• TIQ China Strategic Plan 2015-16
China Market Spotlight
• New Normal Model: Transition from investment driven to consumption driven;
• Devaluation of Chinese currency and turbulence of Chinese stock market;
• Serious challenges by growth slowing, environmental pollution, food safety, ongoing anti corruption and its chain reaction.
Trends & Opportunities
Trade:
- Agribusiness and food supply: strong demanding;
- Ecommerce: fast growing marekt and direct purchasing from overseas
Agribusiness and Food
• China has been the world’s biggest food retail market since 2012
• China is Australia’s largest agriculture and fisheries market, worth close to $10 billion in 2014.
• Import growing fast for grain, beef, pork and fruits from Qld since 2010
Catching up with Food opportunities
ChAFTATariffs on most of the agriculatural products exporting from Australia to China will be eliminated, which will give Australia a significant advantage over larger players in the Chinese agriculture market – the US, EU and Canada.
Product A$ million
Beef 722
Sheepmeat 385
Dairy 351
Horticulture 83
Seafood 38
Live animal 142
Wine 217
Australian Export to China 2013 TARIFF
EXPORT
Catching up with Food opportunities
7.5-30%4-7 Years
12-25%9 Years
12-23%8 Years
15%9 Years
10-30%8 Years
10-25%4 Years
14-20%4 Years
14%4 Years
10%4 Years
Top 10 imported foods@Tmallby country of origins
16%
12.40%8.90%
7.10%
6.50%
5.50%4.50%
4.30% 4.10% 3.40%
Country of Origins
Republic of Korea
Hong Kong&Macau
Vietnam
Malaysia
Italy
Germany
Thailand
France
Indonesia
New Zealand
Orders of imported foods@Tmail by cities
19%
24%
12% 23%
8%
8%
6%
1st Tier Cities
New 1st Tier Cities
2nd Tier Cities
3rd Tier Cities
4th Tier Cities
5th Tier Cities
Others
Trends & Opportunities
Investment:
- One Belt and One Road Initiative;
- Ongoing overseas investment focusing on agri and property development
China’s Outbound Direct Investment
China’s Outbound Direct Investment
One Belt One Road
Rise of Privately Owned Enterprised – China’s New ForceWith the growing strength of Chinese POEs and the government’s support for “going out”, a smaller proportion of China’s increasing outward FDI is coming from SOEs. By the end of 2013, China’s outward FDI of non-SOEs accounted for 44.8% of China’s total accumulated outward FDI value, and their outflow comprised 56.1% of the total outflow of 2013.
M&A Rush in Real Estate and Construction
M&A Rush in Agribusiness and Food
M&A Rush in Energy and Mining
Main Risks Faced by the Chinese Companies
• Political Risk in host countries;• Intitutional Risk such as legal and taxation;• Lack of strategic planning;• Weak of local cultural understanding and
integration;• Lack of international professionals
TIQ China Strategic Plan 2015 -16
• Qld Premier’s visit to China in Sept, 2015
• Chinese buyers mission to Qld in Sept, 2015
• Qld food mission to FHC, Shanghai , Nov 2015
• Initiating investment missions to Qld focusing on agribusiness and tourism facilities development in 2015 /16
• Queensland Government ministerial missions to China 2015/16
• Chinese business migration / investment mission to Queensland, in 2015 /16
• Regular investment / business migration promotion workshops in various cities 2015-16
TIQ China Office look forward to working with you
Q&A section