CCTV9英语新闻：Foreign investors fast track investments in slowing economy

Serve the people --may be an old slogan, but these days it really pays off in China. Foreign investment into services is double that of other sectors.  Cheng Lei speaks to companies that are adapting very well to China's economic transition to find out what helps them outperform.

 

Slowdown? What slowdown? SAP Greater China just had its strongest year ever.

 

"It’s been a good ride, proves that tech can help companies in challenging and in good times, the world is changing, everything digital, consumer so powerful, need to respond, tech is key," Mark Gibbs, CEO of SAP Greater China, said.

 

In line with changing China, International SOS is changing its business focus.

 

"Our traditonal mkt, looking after mncs coming into china, def slowed, several yrs, shift focus to chinese coys ivnesting overseas, expansion. That's taken strong hold. we see that continuing. for us outbound growth stronger than inbound," John Williams, MD of International SOS China, said.

 

This is the nerve centre of International SOS, when the phone rings, it means a Chinese tourist or an employee of a Chinese company has medical needs, the doctors and assistance professionals around me are on hand 24-7 to help.

 

International SOS expects its outbound business to grow to half of total revenues over the next five years. Healthcare is just one service industry foreign companies enjoy an edge in.

 

"Medical services in general, healthcare, will be important growth area. Culture, content, related to IP, because entertainment, leisure, sports, all these are mncs’ at least one generation ahead of Chinese competitiors. Take years for them to catch up. At least 10 yrs’ window to enjoy very good profits," Teng Binsheng, Assoc. dean of Cheung Kong Graduate School of Busineses, said.

 

61% of foreign investment into China last year was in services. That means 77 billion dollars and the number could be even higher with regulatory easing.

 

"Clinical, chinese govt promoting greater investment, however, as foreign player, the ways of investing into healthcare space are relatively restricted, many coys that want to invest would like to see greater relaxation," Williams said.

 

As manufacturing slows down, SAP is helping companies expand from manufacturing into services .

 

"Retail, consumer business, doing well, financial services very strong, mfg and hi tech, mfg, strong move to leverage tech, as part of made in china 2025, parallel to industry 4.0, helped whole mfg sector," Gibbs said.

 

Local services companies are using M&As to beef up in areas like retail and tourism.

 

"Some busy buying mncs, like fosun with follie follie and club med, combining upscale brands with consumer needs, majority of Chinese companies need to develop their own brands to do better," Teng said.

 

As China moves from a 50% services-driven economy to the 70% OECD average, serving the people is proving to be an excellent buffer against a slowdown.