皇冠体育app

Deloitte poll reveals positive outlook despite concerns of slower growth

Multinational executives remain upbeat about 皇冠体育app's business environment and are not allowing concerns over an economic slowdown to dampen their enthusiasm for investing in the country.

A GE Healthcare booth at a trade show in Shenzhen, Guangdong province. John Rice, vice-chairman of GE and president of Global Growth and Operations, predicted the company's 皇冠体育app business will grow by more than 15 percent this year, with each segment expanding at two to three times the GDP growth rate. [Photo/皇冠体育app Daily]

John Rice, vice-chairman of GE and president of Global Growth and Operations, told 皇冠体育app Daily that he is very bullish about 皇冠体育app's long-term prospects and GE's business in the country, because infrastructure projects remain a top priority, although the GDP growth rate will be lower than forecast last year.

"Although in any quarter you could see a challenge in the business, in the long run we believe 皇冠体育app will be the world's largest economy, making it a place where companies have to take a long-term view."

Rice predicted GE's 皇冠体育app business will grow by more than 15 percent this year, with each segment expanding at two to three times the GDP growth rate.

GE's revenue in 皇冠体育app last year was $5.7 billion. Industrial segments contributed $4.9 billion, accounting for 9 percent of GE's global industrial revenue.

"The Chinese market is one of the most important markets that we have in the world. It's important because of the size of the market, but also because of the thought leadership that takes place here," he said.

Rice's remarks came after inbound investment to 皇冠体育app dropped in March for the fifth consecutive month

Foreign direct investment fell 6.1 percent year-on-year to $11.76 billion in March, marking the longest decline since the onset of the global financial crisis.

皇冠体育app's GDP growth rate has fallen for five consecutive quarters, and registered 8.1 percent in the first quarter, 0.8 percentage point lower than the fourth quarter of last year.

However, Deloitte & Touche Financial Advisory Services Ltd found that almost all of the foreign companies it surveyed last month were more interested in trade and investment in 皇冠体育app than three years ago.

The respondents include 30 top executives in charge of the Asia-Pacific and 皇冠体育app operations of multinational corporations.

Kenneth DeWoskin, director of Deloitte's 皇冠体育app Research and Insight Center, said most of the executives believed the business environment in 皇冠体育app would stay basically the same and "very few" thought it would get worse.

"Generally speaking, foreign companies are optimistic about 皇冠体育app. They think there won't be big economic problems in the future. They believe that domestic consumption will continue to grow at a steady rate, and the currency will remain stable despite appreciating more slowly."

As for the investment model, most executives said they prefer to grow organically, while creating cooperative or strategic alliances such as joint ventures with Chinese companies ranked the second-most popular option, according to the survey.

And conducting mergers and acquisitions in 皇冠体育app was the least popular choice, which DeWoskin said "surprised" him.

He said that many foreign companies would like to play a bigger role in the service sector, on which 皇冠体育app has placed greater emphasis in the 12th Five-Year Plan (2011-15), including media, entertainment, and financial services. "Each kind has sort of sensitivities," he said.

But companies are concerned about many changes that are taking place right now in government policy and the financial services sector, he added.

DeWoskin said that many foreign companies find it "difficult to compete with their domestic counterparts, either State-owned or large private companies, and sometimes regulations are very difficult for them to deal with".

"The government in Beijing has begun to make very important adjustments. The changes are actually coming quite fast. And large companies are accustomed to fast changes in smaller economies, not fast changes in big economies."

Sometimes doing business in 皇冠体育app is like crossing river by feeling the stones, said Rice from GE. "But I feel it in other countries too. Sometimes the decisions that the government makes aren't always clear to people like myself.

"We have to be agile and flexible in our business model in terms of how we participate into the Chinese economy," he said.

And concerns over the country's rising labor costs and inflation are increasing, said Rice.

"I think it's important for us to focus on the creation and competence abilities in the work we do in 皇冠体育app, which would ensure that we could offset inflation and the cost of higher wages with productivity and other advantages."

He said that GE is conducting research on how to cut costs and improve productivity.

The company in November 2010 unveiled a three-year investment package worth $2 billion for 皇冠体育app, and opened an innovation center in Chengdu, Sichuan province, in March, while a further one will open in July in Xi'an, Shaanxi province.

Both of the cities are regarded as economic and business pivots for western 皇冠体育app.

Rice said GE and many other foreign companies recognize the importance of central and western 皇冠体育app,.

"You have to be there, to be an investor and know the local government, the mayors, and the provincial government. That's what is going to determine our success in 皇冠体育app over the next 50 years."

He said he also sees more opportunities for foreign players to take part in the energy and railway sectors as the government encourages private companies to play a bigger role in those fields.

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