Experts and officials see relief for tensions over the US-Sino deficit
A key initiative to address the mainland's trade imbalance was launched yesterday when the renamed China Import and Export Fair (CIEF) opened with a thrust into the market by 89 Hong Kong companies.
The US, which has complained bitterly about its trade deficit with China, was barely present. There were no recognisable US companies although the fair organiser said there were 19.
The import section of the 50-year-old biannual fair, covering only 10,400 square metres, is dominated by the Hong Kong pavilion which showcases 89 companies. Importers include 42 companies from Taiwan, 36 from South Korea and 35 from Malaysia.
Vice-Minister of Commerce Gao Hucheng said at the opening ceremony that the role of the Canton Fair, as the CIEF is more popularly known, in increasing imports 'fully demonstrates the Chinese government's sincerity and efforts to balance its trade'.
'It will definitely provide a platform for exporters with an interest in the Chinese market,' he said. 'It is an opportunity for them to deeply understand the China market and to co-operate with companies in various sectors.'
The import showroom may not cover 2 per cent of the sprawling fair but experts said they did not doubt its significance to increasing imports.
Guangdong Foreign Studies University professor He Yuangui said that the fair would definitely contribute to reducing the trade surplus.
'Many foreign brands are exhibiting their products at the fair,' Mr He said.
'The import channel has become more direct because you have face-to-face transactions and that cuts costs and raises efficiency.'
Xiao Lian, director of the Centre for American Economic Studies at the Chinese Academy of Social Sciences, also sees the Canton Fair as more than a symbolic gesture of the mainland's determination to balance its trade.
'You can see in Canton Fair an adjustment in the trade strategy,' he said.
'A country's trade and foreign exchange reserves must be balanced. It's not a case of the more the better.'
The Trade Development Council (TDC), meanwhile, is hoping that the fair will be a platform for Hong Kong companies and brands to penetrate the mainland market.
TDC executive director Fred Lam Tin-fuk said Hong Kong goods would have an edge in terms of design and trendsetting.
Children's shoes maker Onlen Fairyland (HK) Company, which sells 30 per cent of its products to the domestic market, was one of the Hong Kong companies that was allotted space.
'We have been looking forward to this for a very long time. The fair has been held 100 times but we've never had an opportunity until now to participate,' said business promotion director Iris Lam Choi-long.
Onlen has six factories in the mainland making children's shoes.
Jet Power International, which manufactures plastic and metal products such as toilet roll dispensers and its patented wine glass holders and mopping buckets, also passed the TDC's selection process but was not initially interested in taking part.
'We thought that local buyers would not come. They think Hong Kong products are expensive but TDC says the standards of living in the mainland are rising and branded goods can sell well,' said the company's manager Henry Tsui Chin-hang.
Additional reporting by Ivan Zhai
Importers will have a small but likely important role at China Import and Export Fair
Percentage of space allotted to foreign companies importing into the mainland 2%