China presents fresh opportunities amid pandemic, CEOs say at CIIE

The third edition of the China International Import Expo (CIIE) was held between 5-10 November in Shanghai. Proposed by Chinese President Xi Jinping in 2018, the expo showcases China’s support for trade liberalization and economic globalization, and its resolve to further open its markets to the world.

At this year’s CIIE, chief executives saw China presenting fresh opportunities for international companies, especially during this pandemic, when digitalization, innovation, and cooperation are essential to bringing companies out of the woods.

The South square of the National Exhibition and Convention Center (Shanghai), the main venue for the 3rd China International Import Expo (CIIE), in east China's Shanghai. (Xinhua/Ding Ting)

A resilient market amid pandemic

For L'Oréal, the world’s largest cosmetics company, this pandemic has been both a curse and a blessing.

Under strict lockdowns and restriction measures during the pandemic, many hair salons, beauty shops, and cosmetics stores worldwide have been closed for several months, which has affected L’Oréal’s turnover.

But during an online press conference at the CIIE, Jean-Paul Agon, L’Oréal’s CEO, revealed that the pandemic only had a limited impact on the company, as L’Oréal’s Chinese market and e-commerce division both had strong performances during the pandemic.

“At the end of September, despite the COVID-19 crisis, our sales (in China) have increased by more than 20%, and we are very confident to continue on a very strong rhythm until the end of the year,” said Mr. Agon, who created L'Oréal China in 1997.

L'Oréal's sales growth rate, %, like-for-like. (People's Daily Online/Meng Bin)

L’Oréal’s growth in China against the backdrop of a global pandemic can be largely attributed to China’s rapid economic recovery and dynamic consumer market, following China’s prompt and resolute actions to curb the virus.

International companies have also been profiting greatly from China’s booming e-commerce industry during the pandemic. With streets empty and stores closed, live commerce, a combination of e-commerce and live-streaming, became a phenomenon in China and kept its popularity even after life returned to normal.

L’Oréal’s success in China is merely a microcosm of the country’s thriving e-commerce sector. In the first half of this year, according to the National Bureau of Statistics (NBS), China’s online sales exceeded 5 trillion RMB, up 7.3 percent year on year despite the pandemic. With this, China is expected by the IMF to be the only major economy to see positive growth this year.

Cosmetics, exercise equipment, video games, eBooks, and others that seized the opportunity to follow the trend of e-commerce and digitalization have emerged as winners during the crisis. As Mr. Agon put it, this pandemic “is an accelerator rather than a disruptor, as it accelerates the trend towards digitalization, e-commerce and new ways of consumption”.

A hub of digitalization and innovation

In the grueling battle against this unprecedented outbreak, digitalization and innovation have served as a shining light for those looking for a way out of the darkness.

In February, Tencent joined hands with Alibaba to introduce the world’s first health QR code app designed for contact tracing, which has become an effective tool for China to contain the virus. As the battle against the virus heated up, drones and robots served as reinforcements for frontline workers to measure temperatures, disinfect contaminated areas, and deliver packages. When schools and offices were closed, virtual classrooms, working from home and cloud meetings became a trend. Digitalization and innovation are essential, especially during a crisis like this.

At this year’s CIIE, CEOs and company representatives stressed the importance of digitalization and innovation and spoke highly of China’s role in this process.

Denmark's biopharmaceutical company Novo Nordisk has brought a much broader portfolio of healthcare solutions with more Chinese characteristics this year to the CIIE. (China Daily)

At a virtual press conference at CIIE, Lars Fruergaard Jørgensen, CEO of Novo Nordisk, said: “I think China is the leading country in the world when it comes to using digital tools like chatbots.”

Novo Nordisk, a global healthcare company specializing in diabetes care, has been working with Microsoft China to develop a chatbot that can answer diabetes-related questions and help to raise public awareness of the disease in China.

The Danish company is committed to investing 200 million yuan in the Chinese market to fully integrate the company’s research center in China into its global research system. "It is part of our strategy to invest even more in developing innovative medicines for China," said Mr. Jørgensen.

Katsuyuki Tomizawa, director of Mitsubishi Electric (China), pointed out: “China will become the ballast stone of the global economy and a new driver for world growth, with its rapid building of the 5G network, among other new infrastructures.”

“Mitsubishi Electric will also provide our solutions in areas like industrial IoT, big data, and urban rail transport to lend fresh impetus to the lives of the Chinese people and contribute to China’s development in the new era,” he said at the CIIE. 

A model of cooperation

This year’s CIIE was held as scheduled despite the global pandemic. During this time of crisis, the spirit of cooperation at the CIIE has become more relevant than ever. When we all need social distancing to shield us from the virus, companies need to work closely together to pull through.

Zhu Wei, chairman of Accenture in China, said at the CIIE: “It's imperative for businesses to embrace cooperation and boost innovation for sustainable yet disruptive growth.”

A staff from Israeli high-tech company Watergen introduces water-from-air technology. (Xinhua/Shang Hao)

Ivan Melnikov, chief representative in China of Watergen, an Israel-based company developing water-from-air solutions, told reporters at the CIIE: "I think the CIIE is super effective. After my first CIIE journey, I continue to recommend this platform to other friends as a perfect opportunity for any competitive company to enter the Chinese market."

The third edition of the CIIE concluded in Shanghai on November 10, with the value of tentative deals reached for one-year purchases of goods and services exceeding $72.62 billion, up 2.1 percent year-on-year.

"At a time when the world economic landscape is undergoing profound changes, the holding of the 3rd CIIE reflects China's determination and efforts to expand its openness, share its opportunities and promote inclusive development, and expresses its willingness to welcome companies from all around the world to China for cooperation and development, which is a very positive signal for multinational companies," said Anna Pawlak-Kuliga, CEO of IKEA China, at the CIIE.