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A project funded by the European Union

WELCOME TO THE EU SME CENTRE WEBINAR SERIES

www.eusmecentre.org.cn info@eusmecentre.org.cn

Please continue to submit your text questions and comments using the Questions Panel

Purpose

• The EU SME Centre in Beijing is a project funded by the European

Union

• To assist European SMEs to export to China and establish,

develop and maintain commercial activities in the Chinese

market

• Free, confidential information and advice, and practical support

services

3

BD

S&C

HR & Training

Legal

Information

and advice

• Enquiries

• Publications

• Training

• Webinars

• Databases

Support

services

• Hot desks

• Briefings

• Matchmaking and

networking

Services

4

Some key figures comparing cities

GDP growth year by year 2009-2013

Regional Cities in China:

Opportunities for EU SMEs in Changsha Phoebe Zheng / Miranda Hou, March 18 2014

A project funded by the European Union

8 A project funded by the European Union

Part 1: Introduction to the Enterprise

Europe Network Central China

Zheng Qiwen

About the Speaker

• Name: Zheng Qiwen (Phoebe)

• Education: Bachelors Degree from Shanghai Science &

Engineering University in 1991; MBA studies at Hunan

University from 2005 -2007

• Working experience: more than 15 years experience in

international trade promotion at CCPIT Hunan

• Position: Executive Director of EEN Central China at

CCPIT Hunan since 2010

• E-mail: zhengqiwen@hnccpit.org

About EEN Central China

• Coordinated by the China Council for the Promotion of

International Trade (CCPIT), Hunan Sub-Council

• Located in Changsha, capital of Hunan Province

• Covering Shanxi, Henan, Anhui, Jiangxi, Hubei and Hunan

• One coordinator and two partners

• Established in December 2008 as the first branch authorised by the

European Commission in China

• Formerly known as the Europe Information Center Changsha Relay,

established in 2004

• One coordinator

• CCPIT Hunan Sub-Council

• 2 partners:

• Hunan Provincial Science & Technology Department

• Wuhan Science & Technology Bureau

• One sub-contractor partner

• CCPIT Hubei Sub-council

About EEN Central China

• Founded in 1978 as a foreign economic promotion organisation

• Consists of members of Hunan economic and trade

representative figures, enterprises, associations and groups

• China Chamber of International Commerce / Hunan Chamber of

Commerce (CCOIC Hunan) since 1988

• 14 branches around Hunan province

• More than 3,000 enterprises are members of CCOIC Hunan,

covering all industries

• Most of the elected vice president members are large-scale

enterprises in China

CCPIT Hunan

Technology

Innovation

Transfer

Communication

Information

Investment

Agency

A B

Help SMEs to

apply EU projects

C

EEN Central China –

Functional Divisions

EEN Central China – Services

• International commercial and technology information exchange

and dissemination

• Answering enquiries from SMEs

• Database of Chinese SMEs

• Brokerage events and matchmaking meetings

• Training courses for SMEs

• Foreign delegation reception

• Chinese SME delegations abroad

• EU projects application and follow-up

Winning New Business Abroad Under New

Crisis Seminar 2012 (Changsha)

The 1st Session of EEN China National

Conference 2012 (Changsha)

EENCC Inauguration Ceremony 2012

(Changsha)

Hannover Technology Cooperation Day

2012

EEN Central China – Activities

Mission for Growth 2013 (Beijing) 2013 Asia-EU Matchmaking Event (Beijing)

How to Explore the Chinese Market 2013

(Beijing) 2013 Hunan-UK SMEs Matchmaking Event

(Changsha)

EEN Central China – Activities

www.eencc.com

EEN Central China – Website

EEN Central China –

Main Events 2014

EU- Asia SMEs Matchmaking Event 2014, Beijing

Date:

13-15th May 2014

Activities:

1. EU- Asia SME one-to-one meetings

2. Visit to the Beijing High-Tech Expo

Focus on:

•ICT Industry & Service

•Modern Engineering and Manufacturing

•New Materials and New Energy

•Environmental Protection

•Modern Agriculture and Green Technology

•Bio-Engineering and Pharmaceuticals

EEN Central China –

Main Events 2014

EU- Asia SMEs Matchmaking Event 2014, Changsha

Date:

10-14th November 2014

Activities:

1.EU- Asia SME commercial/ technological matchmaking projects

2.Training sessions and foreign projects promotion (for Chinese enterprises)

3.Hunan investment environment promotion and key projects promotion (for foreign enterprises)

4.Attendance or visit to Hunan High-Tech Expo

5.Visit to the High-Tech Zone

Focus on:

• Information Technology • New Energy and Energy-saving Technology

• New Materials • Resource and Environment Technology

• Biochem Tech • Advanced Technology for Transformation of

Traditional Industry

• Biopharmaceutical Tech

EEN Central China – Contact

Address: 6th Floor, Hunan International Commerce Center Building

No.1139 Dongerhuan Road

410016 Changsha

Hunan, China

Telephone: +86 731 84773311 / 84773309 / 84773312

Fax: +86 731 84773377

Email: zhengqiwen@hnccpit.org

eleon0718@gmail.com

Web: www.eencc.com

Thank You for Your Attention!

Part 2: Opportunities for EU SMEs in

Changsha Miranda Hou

A project funded by the European Union

About the Speaker

• Studied in the UK for five years and received

Master of Arts in International Business

Economics

• Two years working experience in international

company

• Four years working experience in high-tech

development zone

• Chief Representative of the China-Britain

Business Council (CBBC) Changsha Office

since 2013

Miranda Hou

Agenda

• Chapter 1: Overview of Changsha

• Chapter 2: Advantages of Changsha

• Chapter 3: Development of Industry Clusters

• Chapter 4: Opportunities for EU SMEs

Overview of Changsha

• General Information

• Milestone Development

• How Changsha Compares…

• Foreign Investors

General Information

• Changsha, provincial capital of Hunan

• Area 11,800 km² (4556 square

miles)

• Population 7.04 million (end of

2011)

• GDP CNY 640 billion (2012)

• Annual growth rate 12.4% in 2012

(higher than national average of

7.8%)

• Total value of imports and exports

USD 8.7 billion (2012)

Changsha

Sources: Changsha Bureau of Commerce; Changsha Bureau of Statistics

Milestone Development

GDP Scale

Sources: Changsha Bureau of Statistics

How Changsha Compares…

Changsha is economically competitive with other cities in Central

China

1/2 size of Guangzhou

1/3 size of Shanghai

Sources: Changsha Bureau of Commerce; Changsha Bureau of Statistics; National Bureau of Statistics

Year 2012

Foreign Investors

• 89 top 500 enterprises have set up their workshop (49

companies with direct investment)

• Many EU enterprises invest in Changsha

• Germany

• UK

• France

• Italy

• Finland

• Belgium

Sources: Changsha Bureau of Commerce

Continues to Strengthen its

Competitiveness

Proportion that secondary industry contributes has increased from

42% in 2003 to 56% in 2012

Sources: Changsha Bureau of Commerce; Changsha Bureau of Statistics

• Transportation

• Talents

• Lower Labour Costs

• Policy

Advantages of Changsha

Transportation

• Within two hours you

can reach an area of

5 million Km ²

One hour

Two hours

Transportation

• High-speech transportation hub

Three national major

high-speed railways

Sources: Changsha Bureau of Commerce; Changsha Wanbao.com; Hunan online

Transportation

• Seven inter-city railways linking

surrounding cities

• Changsha-Zhuzhou-Xiangtan

railway (under construction)

• Changsha-Yiyang-Changde railway

(under construction)

• Another five lines are planned

Sources: Changsha Bureau of Commerce; Changsha Wanbao.com; Hunan online

Transportation

• Airport and airlines

• Huanghua International Airport

(17km from downtown)

• Direct flights to 60 domestic

cities and 16 international cities

• Most EU cities reachable with

one transfer in Shanghai,

Beijing or Hong Kong

Changsha

Bangkok

Singapore

Seoul

Frankfurt Taiwan

Hong Kong

Macao

Transportation

• Metro

• 4 lines are under construction and are expected to be in

operation between 2014 to 2017

Sources: Changsha Bureau of Commerce; Changsha Wanbao.com; Hunan online

Transportation

• Port

• Changsha Xianing port is one

of 23 major inland ports in

China

• Important inland port along

Yangtze River with an

increasing throughput

• 30.9 million tons in 2012,

expected to reach 40 million

tons by 2015

Sources: Changsha Bureau of Commerce; Changsha Wanbao.com; Hunan online

Talents

• 97 scientific research &

development institutions

• 48 universities / colleges

• 5 national key universities

• 310,000 graduates

National University of

Defense Technology

Central South University

Hunan Normal University

Hunan University

Central South University

Xiangya School of Medicine

Changsha

Sources: Changsha Bureau of Commerce

Talents

• Professional and

technical workforce

• 32 technical schools

• 9.6% average turnover

rate

• 43,000 graduates from

technical schools in 2011

Sources: Changsha Bureau of Commerce

Lower Labour Costs

Source: Changsha Investment Environment Report 2013

Policies

• Preferential tax policies

• Each industrial park or economic zone can provide certain tax

policies in their key industry

• Bank loans

• National bank has offered loans on favourable terms for

enterprises and projects

• National-level zones can provide interest subsidies to certain

projects in the zone

• Discount on land prices

• Around 50% to 60% discount on land prices for key industry

projects or projects promising high tax returns in the future

Sources: Changsha Bureau of Commerce; Administrative Committee of Changsha national high-tech development zone

Development of Industry Clusters in

Changsha

• Construction Machinery

• Automobile and Parts

• New Materials

• Cultural and Creative Industries

• Emerging Industries

Focus industries

Construction machinery

Automobile and parts

New materials

Cultural and creative

Focus Industries

CNY 194.7 billion,

6.6% (Y-O-Y)

CNY 31.1 billion,

26.6% (Y-O-Y)

CNY 123.9 billion,

19.0% (Y-O-Y)

CNY 125 billion,

20% (Y-O-Y)

Sources: Changsha Bureau of Commerce; Changsha 2012 National Economic and Social Development Report

Construction Machinery

• 24% of Changsha’s total industrial output

• 32% of China’s total machinery industry output

• Strong R&D capabilities

• Leading companies: Zoomlion, Sany, Sunward, AVIC Landing Gear

32% 24%

Sources: Changsha Bureau of Commerce; Changsha government website;

Construction Machinery

• Case Study

Standard Chartered Changsha Branch

Management

“We have benefitted by providing

services to Changsha’s many

construction machinery companies

who are making outbound

investment to regions such as

Africa.”

AVIC Landing Gear Management

“Changsha government has actively

provided support to us. On one

occasion they helped us negotiate

with the power company and solved

a problem with the power

connection without interfering with

the project process.”

Sources: Changsha government website; Changsha Investment Environment Report 2013

Automobile Manufacturing

• Formed a complete industrial chain

• Automotive R&D

• Parts manufacturing

• Automobile manufacturing

• Future development is expected to include:

• Development of coach car / SUV / truck / car

manufacturing

• Enhancement of core parts technology development

(automotive electronics, engines, axles and chassis)

Automobile Manufacturing

Design and R&D

Parts manufacturing

Automobile manufacturing

Bosch

Lizhong

Automobile

Design

Bosch

Magna Cosma

Marelli

Johnson Controls

Sumitomo Rubber

Hitachi

Volkswagen

BYD

GAC Fiat

GAC Mitsubushi

Foton

Zotye

Shaanxi Heavy

Truck

Major companies

Sources: Changsha investment environment report 2013;

Automobile Manufacturing

Case Study

• GAC Fiat Automobile Company (GAC Fiat)

• The company was established by Fiat Italy and GAC as a JV

in 2010. It mainly focuses on R&D, manufacturing, sales and

after-sales of passenger cars, engines and parts.

• Total investment amount reached CNY 5 billion and the phase

one capacity reached 140,000 cars annually.

• The first series of automobiles were introduced in September

2012 and the sales reached 12,000 in two months.

• The number of automobile dealers reached 113 and this is

expected to exceed 200 by the end of 2013

Sources: Official website of GAC Fiat; Changsha investment environment report of 2013

New Materials

• Growing rapidly; key products have a high market share

worldwide

• Total output value of CNY 123.9 billion, representing 15.5% of

Changsha’s total industry output

• Most companies are global leaders in their respective sectors

• Liyuan New Material Ltd - Largest manufacture in the world of

band-shaped nickel foam

• Shanshan New Material Ltd - Largest company nationally and

third largest company globally manufacturing lithium batteries

• Lens Technology Ltd - Own 60% of the screen products

market for mobile phones, computers and digital cameras in

the world

Sources: Changsha Bureau of Commerce; Changsha government website;

New Material

• Local government looking for further development fields:

• New energy materials

• Advance composites

• Energy conservation materials

Cultural and Creative Industries

• Annual average growth rate of around 20% during 2006 to 2010;

Total output reached CNY 125 billion in 2012.

• Strong foundation in media, animation and publishing

• Famous broadcaster: Hunan TV

• Animation output ranked first nationwide for six consecutive

years

Two main projects in Changsha in the cultural industry

Hunan Museum

Changsha Meixi Lake International Culture and Art Centre

Cultural and Creative Industries

• Local government expected to support

• New development models

• Cross-sector cooperation

New models

Culture + Innovation

Culture + Technology

Culture + Finance

Culture + Tourism

Cross-sector cooperation

Technology

Financial

Tourism

Sources: Changsha Bureau of Commerce; Changsha government website;

Emerging Industries

• Value of logistics goods CNY 2 trillion, up 19.3% compared with 2011

Modern Logistics

• Output value CNY 19.8 billion, up 31.8% compared with 2011

Biomedical

• Added value CNY 23 billion, up 11.6% compared with 2011

Financial Services

• Contract value CNY 35 billion, up 18.1% compared with 2011

Service Outsourcing

Sources: Changsha Bureau of Commerce; Changsha government website;

• High-End Technology

• Cultural and Creative Industries

• Eco-Friendly Technology or Sustainable Solutions

• Vocational Education and Training

Opportunities for EU SMEs

High-End Technology

Lower-cost manufacturing

Higher-value added industrial

Entry to high-end market

High-end technology

Professional services

Local government

support

Input

Support

Encourage

Cultural and Creative Industries

• Changsha is a major entertainment centre

and Hunan TV is the country’s leading

broadcaster in terms of audience ratings

• Chance for EU SMEs Hunan

TV

UK

Korea France

Chance

Creative industry collaboration

On TV programming

Field of animation

Cultural industry

Hunan Museum

Changsha Meixi Lake

International and Art Centre

Eco-Friendly Technologies &

Sustainable Solutions

• Background

• Two oriented society

• Chang-Zhu-Tan City Cluster

• Hunan government planning investment of CNY 70 billion over

10 years

• Chance for EU SMEs

Environment & Water

Construction and Infrastructure

• Factory waste water and water remediation for Xiang River

• Soil & air purification

• Meixi Lake project

Vocational Education &

Training

• Export-oriented enterprises used to have difficulties to

find talent with high-level sector skills and good English

Corporate/Executive Training

English language training

Engineer

Project Manager

Sector-specific training

Skills

Speaker: Miranda Hou

Email: Miranda.hou@yahoo.com

Tel: 0086 731 82281511

www.eusmecentre.org.cn info@eusmecentre.org.cn