Editor's note: China has reached its first centenary-related goal and is embarking on a new journey to fulfill its second centenary-related goal of building a strong and modern socialist country in all respects. China Daily talked to business executives of multinational corporations on their understanding of China's achievements and growth engines going forward, and opportunities they are ready to embrace.
Q1: Xi Jinping, general secretary of the Communist Party of China (CPC) Central Committee, Chinese president and chairman of the Central Military Commission, announced at the ceremony marking the centenary of the CPC that the nation has accomplished the building of a moderately prosperous society in all respects. In your view, what are the main factors that helped China accomplish this goal?
Q2: What do you make of Xi's emphasis in his speech on China pursuing peaceful development as well as its resolve to promote high-quality development and further deepen reform and opening-up? What does this mean for your business in China?
Q3: One big achievement China has made is eradication of absolute poverty. Now the country is moving toward achieving common prosperity. In your view, what is the most attractive and promising part of the Chinese economy as the country seeks to reach the second centenary-related goal－that of building a strong and modern socialist country in all respects?
Q4: China has embarked on a new development journey. What new trends do you expect to emerge as the country boosts its innovative ability to actualize the full potential of its productivity and also makes progress in improving rule of law and modern governance? How do you plan to position your business to benefit from such trends?
Q5: Which areas need to be prioritized to further increase the resilience of the Chinese economy and boost its attractiveness for foreign companies and investors?
A1 I've lived in China for 10 years, and I've seen and been impressed by so many developments in my time here. One of the many key factors that has struck me about China's progress is the country's spirit of agility. The world's political and economic environment continues to constantly change and evolve rapidly and the market and people here respond quickly and proactively to varying circumstances and different situations. For example, China has modeled how quickly markets can recover from the pandemic and emerge stronger, demonstrating the resilience of the Chinese economy.
At Diageo China, we often use the expression, "China Speed". We always strive to be agile and flexible in terms of strategy and execution, and this spirit is China-homegrown.
A2 We see encouraging long-term growth trends in the market and an exciting future ahead. We remain committed to growing our business footprint in China and aim to meet the growing demand of Chinese consumers by supporting the development of China's beverage alcohol and hospitality industry.
At Diageo, we believe that high-quality development is sustainable development that emphasizes doing business the right way for longer term progress that also contributes value to our customers, consumers and communities.
We do see developments and reform that aim to enhance our sector. For example, China is revising its whisky standard. Diageo, along with the Foreign Spirit Producer Association, appreciates the opportunity to participate in the process, discuss and contribute ideas, as we share the same objective of developing a future-proof product standard fit for China.
A3 From our decades of experience in China, we see that Chinese consumers' spending power is growing faster than anywhere else in the world. With growing disposable incomes, Chinese consumers are leading trends and becoming more sophisticated and demanding. For instance, we have seen a growing desire among some Chinese consumers to buy a cask of whisky instead of a bottle. This was unthinkable just a few years ago. Looking into the future, I hope we can further explore even more opportunities to grow as well as contribute to this dynamic market, working together with our partners to further stimulate economic development and the agility of business growth in the market and industry.
A4 We believe the trend of premiumization, where consumers value quality and drink better, not more, will endure. We are confident in our diverse portfolio being able to cater to every occasion and consumer－from baijiu to Scotch to premium beer.
Our company is sustained through innovation, and we are constantly looking to create premium and new experiences for Chinese consumers. To attract more consumers to know, learn and appreciate whisky, introducing authentic and premium whisky products to the market and continuously innovating and tailoring products for the Chinese market sits at the heart of our strategy.
A5 With numerous measures like simplified approvals, optimized services and reduced barriers, China has continued to construct a robust business environment for global investors. These measures have boosted system integration and innovation, accelerated the release of policy dividends, realized efficient interdepartmental collaboration and created a high-quality, legalized, international and convenient business environment.
A1 The country's efforts to open up to the world is what we have felt most keenly as we participated in China's economic takeoff during the past decades.
Honeywell is one of the first US companies to enter the Chinese market and has been in China for more than 40 years. Nowadays, China is Honeywell's largest single-country market outside the US. This amazing transformation would not have happened without China's opening up to the world and inviting multinational companies to come and participate in the economic development of the country.
As China is pursuing development of a higher quality and promoting the new development paradigm of dual-circulation, we feel encouraged that the government is ushering in a higher level of opening-up to attract foreign investment and seek balanced and sustainable growth.
A2 With our core business perfectly aligned with China's market demands such as industrial digitalization and decarbonization, Honeywell is well-positioned to participate in China's high-quality development as the country further deepens reform and opening-up.
At the fourth China International Import Expo (CIIE) to be held later this year, Honeywell's booth area will more than double the size of last year, fully demonstrating Honeywell's confidence in the expo as the company participates in the event for the fourth consecutive year. Honeywell is also fulfilling its commitment to the Chinese market by increasing our local investment and R&D efforts.
A3 As China continues its economic growth in a more balanced and sustainable manner, the emerging mass market represents the biggest growth segment in China in the coming decades. It is Honeywell's strategy to accelerate long-term sustainable growth beyond the high-end and traditional mid-markets.
The establishment of wholly owned subsidiary Huosheng Industrial Technology Co Ltd in Wuhan, Hubei province, last year as headquarters for the company's mass-mid segment (MMS) business in China marks a key milestone in our growth and development. It demonstrates Honeywell's commitment to developing and innovating new technologies and solutions for the local market.
A4 In April 2021, Honeywell pledged to be carbon-neutral in its facilities and operations by 2035. This commitment is in line with China's decarbonization goals and sustainable development direction as about half of Honeywell's new product introduction research and development investment is directed toward products that improve environmental and social outcomes for customers.
With a range of proven technologies to reduce carbon emissions, Honeywell is committed to developing products and technologies that address energy and environmental needs in China.
A5 China has made remarkable progress in its business environment, which has played a critical role in promoting the recovery of business entities and China's economy despite the impact of COVID-19. We are glad to see continuous reforms to encourage foreign investment and to vitalize market players.
We feel encouraged by China's ongoing efforts to facilitate foreign investment, and we are optimistic that such efforts will further increase the resilience of the Chinese economy and boost its attractiveness for foreign companies and investors.
A1 It is really exciting to see China accomplish its first centenary-related goal, which is a very remarkable achievement.
We see that in the past decades, the government forged ahead in the practice of revolution, construction and reform, which greatly enhanced the attractiveness and creativity of the Chinese economy, helping facilitate high-quality opening-up and economic development. We can also see that China has embarked on a path of poverty alleviation, following a people-centered philosophy and a series of other measures that concentrate efforts on guaranteeing basic needs to improve people's livelihoods.
A2 China is going to start a new journey toward realization for its second centenary goal, from high-quality economic and social development to people's well-being and the enhancement of people's sense of gain, happiness and security. Every step forward is encouraging foreign companies like Tapestry to strengthen our confidence and determination to deepen our roots in the Chinese market.
To ensure that we stay relevant in such a dynamic market, we are accelerating our localization processes, actively promoting consumer upgrades and digital innovation and embracing change. When we look at China, we feel we are only just beginning and want to contribute to the country as it grows. We look forward to writing more wonderful "China stories" and resonating with the Chinese market for common prosperity.
A3 We see that China's economic development model is now more focused on "quality "growth that is highly inclusive, bringing tangible benefits and providing incremental certainty and confidence to the market. The new development pattern encourages us to keep upholding the concept of innovation, enhance the localization potential of our brands and create more value for Chinese consumers.
The reform of the business environment further enhances the attractiveness and creativity of the Chinese economy, contributing to high-quality development. This also makes the Chinese market one of the most dynamic and influential in the world.
We will try our best to fully respond to Chinese consumers' aspirations for better and higher quality and more personalized lives.
A4 We see that China continues to expand and open up in areas such as the digital economy and the internet, and further deepen the liberalization of trade and investment, while facilitating reforms and innovation. With the expansion of China's opening in the digital economy, Tapestry will keep focusing on leading with a digital-first mindset.
As China is bound to enter a stage of sustainable development during its 14th Five-Year Plan period (2021-25), we firmly believe that being a sustainable company will make Tapestry grow even stronger. We aim to create a modern luxury company of the future that balances true fashion authority with meaningful, positive change.
A5 The booming and rapid development of the duty-free market in Hainan has been a wonder to behold. We have all witnessed the tremendous injection of growth and vitality this has brought to the market. We look forward to working with more partners in the growing market, thus jointly promoting the consumption upgrade and creating more value.
A1 The unwavering spirit of resilience and dedication that the Chinese people have shown throughout the years has been nothing short of inspirational. From poverty eradication to improving the business environment and creating a moderately prosperous society... China has seen a number of historic achievements.
I am deeply moved by the important speech delivered by the Chinese top leadership at the gathering celebrating the centenary. I am proud of the great rejuvenation of the Chinese nation under the leadership of the Communist Party of China.
A2 China's reform and opening-up brought about major achievements in terms of intellectual property rights protections. Indeed, with China's capacity for innovation having ascended to the top of the national policy agenda, Chinese authorities and the local business community have made incredible progress in strengthening enforcement of IPR at home and creating an environment where all companies－both domestic and foreign－can feel that their brands and technologies are secure and protected. This is important for companies such as mine－an environment in which we can protect our brand and help it flourish.
A3 The gradual but much-needed transition toward more sustainable practices in China presents opportunities for multinationals to increasingly show their value as responsible companies.
Consumers are demanding healthier, higher quality and more premium products, and we are dedicated to continuing to provide them with new offerings that appeal to our increasingly nutrition-conscious customers.
Most importantly, TCP Group is committed to conducting business based on the principles of sustainable development as an integral part of our corporate strategy. This aims to continue to build on business growth while fostering economic, social and environmental sustainability.
A4 Under the 14th Five-Year Plan (2021-25) and beyond, China looks set to dramatically accelerate its transformation into a global powerhouse of innovation, sustainability and consumption. For TCP, we will make certain that our business strategy is carefully adapted to ensure that we make meaningful contributions to national priorities as China's grand blueprint takes shape over the next half decade as well as longer term through 2035.
This includes supporting China's innovation drive by continuing to expand our IP-related initiatives with our local partners, supporting the "Healthy China" initiative through partnerships as well as providing our consumer base with innovative and quality products.
A5 Since it was first announced earlier this year, TCP has been closely following the gradual unveiling of China's new dual-circulation pattern. We're confident that this new economic paradigm will help usher in a fresh chapter for the next phase of China's development, enabling the country to effectively mitigate the effects of a more challenging external environment while further accelerating its longstanding transition toward more balanced, sustainable and inclusive growth.
For our business, TCP is confident that dual-circulation will create exciting new opportunities for our global "House of Brands" to tap into, all the while facilitating continued advances across China's food and beverage sector as a whole with our Red Bull products.
A1 Thanks to the great leadership of the Communist Party of China and the concerted efforts of all Chinese people, the country is vigorously implementing an innovation-driven strategy with technological innovation at the core, thus forming a new source of growth.
In combination with the international environment, China has proposed a dual-circulation development paradigm to promote rapid and stable economic growth. We are aware that the government has paid heavy attention to balanced regional development and people's well-being.
A2 Reform and opening-up is China's national policy, peaceful development is a long-term goal, and high-quality development is a new requirement. These three points work together and have great practical significance to the smooth operation of the Chinese economy.
Skechers China is full of confidence regarding business development in the Chinese footwear market. We believe that there will be a better business environment in China. The open market will drive us to invest more in China, and we will establish roots in China and serve the country. We firmly believe that within a sound domestic market environment, we will be able to achieve mutual benefit and win-win results in China and achieve greater success here.
A3 The demographic dividend in China brings business opportunities. Both youthful consumers and senior citizens increasingly enjoy growing spending power, and all demographics are willing to accept new things. With the improvement of people's living standards, consumer demand has surged, and the market has great potential.
The innovation of the business environment and stability of the Chinese market are really encouraging. We see a bright future. With the deepening of reform and opening-up, and the dual-circulation development paradigm, the economy of China will develop rapidly.
Moreover, there is a complete infrastructure and a comprehensive supply chain in China. For foreign companies, this is very attractive. China has promulgated and implemented a number of policies to encourage foreign investment in recent years, which has also greatly increased Skechers' confidence in increasing investment in China.
We are optimistic regarding the Chinese market. In the past two years, we have invested in the Taicang Logistics Center and the Dongguan Asia-Pacific R&D Center to provide better service in China. We will continue to introduce high-quality products in China, and offer a rich and diversified product line to meet the one-stop shopping needs of Chinese families.
A4 In China, a growing number of companies are committed to ESG(environmental, social and governance) efforts. Skechers links the development to ESG factors along with business operations and brand strategy to further development.
We will continue to invest in China, and bring a rich product line to Chinese consumers, focus on local infrastructure development and introduce comfortable experiences from our footwear technology.
A5 Further strengthening the legalization of foreign investment and promoting orderly commercial activities to protect foreign investors are both welcome developments. China has also shortened the negative list for foreign investment access, built pilot free trade zones and a free trade port. These steps will help build a more attractive business environment in the country.
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