China’s exporters optimistic as foreign buyers flock to see products at Canton Fair in Guangzhou

Chinese exporters are hopeful for an influx of clients – and a concurrent increase in orders – as a major trade fair commences and the world’s second-largest economy slowly rebounds after a period of relative lethargy. At the Canton Fair, which opened on Sunday in the southern Chinese city of Guangzhou, participants said foreign buyers are far more motivated. “[A weak] yuan has made Chinese products much more attractive,” said Lam Sing-tin, a Hong Kong-based trader for the Australian market looking for new-energy storage products. “Other geopolitical factors are slightly more relaxed than in the past, especially in the new energy sectors.” The semi-annual fair, held in the manufacturing hub since 1957, is considered a barometer for the country’s export market and the stamina of its supply chains. Those have been tested by weak external demand, trade tensions with the West and the residual effects of the pandemic. Jacob Thiessen, a buyer from Mexico on his first trip to the fair since the Covid-19 pandemic, said he would probably purchase more than he had originally planned. He found the quality and price of many products had not changed much, even compared with the pre-epidemic period. “The depreciation of the yuan against the greenback also has made Chinese products more attractive,” he said. Southeast Asia-led trade pact offers China ‘great opportunities’ amid US feud Although some supply chains have moved to Southeast Asia or his home country, Thiessen added, it was still difficult to find agricultural machinery with similar cost performance outside China. More than 50,000 foreign buyers from over 200 countries attended the fair in person on the first day, representing half of all registered foreign attendees according to organisers. The fall session of the fair will run until November 4. The number of US and Europe-based buyers is expected to rise by 8.6 per cent from the spring session in May, with a jump of 13.8 per cent for foreign buyers from member countries of the Regional Comprehensive Economic Partnership, a China-backed trade bloc covering Southeast and East Asia. Mark Lu, deputy general manager of Yueda Intelligent Agricultural Equipment based in eastern China’s Jiangsu province, said the firm is now focused on expanding into Russia, the US, South America and Europe. Lu said the rise of China’s new energy sector has conferred an extra price advantage in lithium batteries and other components. “One of our latest lithium battery-powered tractors is priced at 100,000 yuan (US$13,713), much cheaper than the 150,000 yuan from foreign brands,” he said. Those cost advantages will be further expanded with the development of China’s new energy industry, Lu added. Demand for replenishment is becoming strong Lydia Zhu, Guangzhou About 74,000 booths have been set up by 28,533 companies. Total booth count is up by more than 4,600 from the session in May, and the company count is up by 12.3 per cent. “We have invited about 500 clients to the fair from across the world, and most have been confirmed,” said Lydia Zhu, vice-president of overseas marketing for Guangdong Xinbao Electrical Appliances Holdings. Zhu’s company is present for the first five-day phase of the session. Each iteration of the fair is broken up into sections, each built around various manufacturing subsectors. “[We estimate] more than 700 customers will drop by our booth during the five days, about 30 per cent from Europe and America”, Zhu said. “[Willingness to purchase] from European and American customers is picking up because their destocking has been carried out, and demand for replenishment is becoming strong.” China’s export decline narrowed for the second month in a row in September, indicating a recovery – however slow – in external demand. Exports fell by 6.2 per cent from the previous year after dropping 8.8 per cent in August, official data showed. China’s foreign direct investment drops despite efforts to attract capital Vice commerce minister Wang Shouwen held a discussion on Sunday in Guangzhou with multinational companies and foreign chambers of commerce, seeking their feedback on trade and operations. The talk was part of a broader charm offensive to revive confidence in the Chinese market among foreign investors, as officials make numerous pledges to address their concerns. Wang said China has big market potential, a mature supply chain and a pool of tech talent, which will offer more opportunities for businesses to expand their presence. In traditional manufacturing, meanwhile, many Chinese exporters continue to lower prices to attract new orders and keep their factories running. Yang Feifei, a manufacturer of lighting products, said she hopes to supply appliances to support reconstruction efforts in the wake of wars or natural disasters. “Chinese suppliers have made a lot of effort to retain [these] buyers, taking risks and trying to [extend] payment terms.”