Lately, so many things happened around the world; the middle east crisis, flood in Australis, drought in China, earthquake and tsunami in Japan and Libyan crisis have brought uncertainties to the global economy. Due the crisis, commodities prices  have gone up drastically and oil prices surpassed USD100 mark.

What's transpired from these calamities and global crisis is that we are going to see increasing inflation in the world due to price increase. Food security will become an issue to deal in near future and this is critical as food is a neccessity to all. Food security crisis can generate instability as people will be under tremendous pressure to keep their financial in good order.

China is always proactive in dealing with such pressure. Various initiatives are being undertaken by the Government to ensure that the nation continuous to move forward with sustained eocnomic growth. Due to its fast growing nature that required ample supply of raw materials, China has stocked up these commodities and at the same time establish strong relationship with producers of commodities around the world. This is to make sure that supply of commodities like oil and gas, coal, iron ore and other minerals is secured for long term period.

The future is with Asia. With China and India taking the lead, Asian countries are expected to increase their share of world's economy. According to the report from World Economic Outlook, fast growing emerging markets are expected to record a growth of 6.6 percent per annum for the next five years till 2015 while advances economies are facing economic slowdown and forecast to grow at much lower, at 2.4 percent per annum.

The figures display the growing importance of fast growing and emerging markets, where most of them are residing in Asian continent. One of the contributing factors is due to the fact that many of Asian economies have not reach their maturity and therefore offer plenty rooms for growth. China, for instance, is a vast country with 1.3 billion population and a size of over 1 million square km. Though some parts of China can be regarded as advanced markets like Shanghai, Beijing and Guangzhou, there are many more provinces or cities in China that requires further development and these actually help to boost the domestic China economy. Likewise, India is another huge market of 1.1 billion population and disparity between advanced and less developed areas is still wide, hence there's still a lot of development to be undertaken in the country which this will help to spur the domestic economy. Other economics such as Indonesia, Vietnam and Thailand also have big domestic market and the increasing purchasing power help to boost economic growth of these economies.

Leveraging on the sustained economic growth in Asia, many foreign investors from advanced countries and middle east are exploring investment opportunities. That areas of opportunities include consumer products, services as well as property/real estate.

It is foreseen that Asian countries will be the future growth of world's economy. These Asian economies, spearheaded by China, are expected to boost their spending in infrastructure development for the benefit of its people, which in turn helping the people to have better living and contribute to the stability.

Due to growing business opportunities in the Asian economies, the people continue to prosper and spending power getting stronger. Countries like China, India, Indonesia and Vietnam can rely on their domestic market to continue registering steady economic growth despite what happened in the global market these past few years.

Back to China, the Government has introduced several measures to sustain its economic growth. The stimulus policy has helped the country to continue investing in infrastructure development especially in the least developed parts of China, such as the western and central China which include such provinces as Xinjiang, Ningxia and Innner Mongolia.

It has been quite some time since my last posting. For the past 2 and half months I have been engaged with overseas business trips and just returned from my trips that covered different continents.

Still, many words around that China continues to post steady economic growth despite what happened in other economies like EU and USA. According to the World Bank's report on 5-year economic growth from 2008-2012, China is expected to post economic growth of more than 8% over these five years, and 2011 will see China growing around 8.5%, albeit a bit slower than previous year's growth of 9.5%.

China also continues to receive huge foreign domestic investment (FDI) from all over the world. Relatively speaking, the inflow of foreign investment is not only attributed to the fact that China offers abundance labor resources at competitive cost, but the more important reason for foreign investors to continue investing in China is the fact that China has a huge domestic market of 1.3 billion, the increasing number of middle income population (around 350-400 million) as well as continuous infrastructure development in China, in particular the second and third tier cities (western and northern part). These 2nd and 3rd tier cities offer huge market opportunities for foreign companies, both in products and services sector. The consumers' purchasing power is increasing which see them craving for imported goods and services, and the cities themselves are going through major evolvement to become more modern and developed cities in China.

If everyone can remember, during many global economic crisis that happened in 1998 and 2008/2009 as well as major epidemic like SARs in early 2003, China's economic growth still remain steady. This basically was supported by strong domestic investment as well as strong domestic consumer market and private consumption, despite China having one of the highest consumer saving rates in the world. This trend is expected to continue and China will continue to rely on its domestic investment and domestic consumer market for its steady economic growth, in addition to China's aggressive initiatives to undertake various forms of investment abroad and to maintain its current strong export performance.

China is not only for big players. Even you are small players, you can still take part in the economic development in the country, amid in much smaller ways. If you are small, then go for small share of the market, which can mean big to us. I remember  there was a Malaysian ICT enterprise ventured into a small city in China of 200,000 population, offering a unique IT solutions that can benefit the whole city. In this case, though the market is small, but it is an achievement for this Malaysan enterprise gaining access into China market. It will take some time though but what is important is that you have a niche and special products/services and you have a reliable partner, which can be privately or state owned enterprises. The support from local partners is absolutely important in making sure that your business plan executes well.

A friend of mine recently asked my views on how to promote her 'special' tooth brush in China. This special item, with a special design, is claimed as a very effective tool to eliminate dirts and clean teeth. For a new product, a lot of work needs to be done in marketing and promotion. In this case, you  also need a good backup from medical point of view and work with reputable partners. Pricing is another issue, where market segment you want to target, the price cannot be too high though there are many customers who can afford to buy expensive imported products. If you  are nobody in terms of branding, the marketing and promotion task will be tougher. For internationally known brands, the brand itself can facilitate promotion of new products in the market, for these popular brands, consumers already associate any new products as reliable and high quality though prices may be expensive.

Competition is very stiff in China, regardless of what business you are in. It comes from local and foreign players and for marketing purpose, you need to have a deep pocket. It's better to ask ourselves whether our presence in China is crowding out the market or is giving us a competitive edge. If it is crowding out the market, the competition is very strong and may require deep pocket. If you have a competitive edge, then you may require less spending but what is required is how you position the product in the market. This is where your partner's cooperation in crucial since they normally understand the local market better, though we also need to do our own homework.

What products or services that China want? For so many years, China has been importing a lot of natural resources/raw materials and commodities and continues to do so. China imports timber, natural rubber, oil and gas and palm oil from Malaysia in a large quantity. It also imports huge volume of semi-conductor and integrated circuits from Malaysia. Generally speaking, imports of all these items constitute more than 60% of China's total imports from Malaysia. It implies that China still require these products for its industrial use and more or less we can say that there are already big players from Malaysia who consistently export these products to China and if you plan to join in, you need to compete with these big players and certainly it is a tough challenge.

So, what else we can offer for Chinese market? Products like processed food and beverage, like confectionery, snacks and bakery products, canned and ready made products, frozen food, seafood, juices, white coffee and cocoa products among those that have good potentials in China. As I mentioned several times earlier, the increase of purchasing power and the middle income population has to some degree shifted the customers perference for imported products. Buying imported products, though relatively expensive as compared to local ones, is perceived as having a high status in the society and imported products are regarded as high quality products.

The mushrooming big shopping malls and complexes in major and medium size cities in China has contributed to increasing inflows of imported products. Products with big brands like Channel, D & G, Dunhill, Ferragamo and Gucci are much sought after in the market and it goes on to so many other foreign brands that to us some of the brands maybe we have never heard before. All these brands and products have their own niche market and relatively doing well even though some of them did fail.

During my stay in China, some of Malaysian brands are already present in the market, among them like Royal Selangor (pewter), Bonia (leather products) and Ekowood (engineering wooden flooring). The brands are not only limited to products but also companies and services and these include companies like Maybank, Petronas, Malaysia Airlines, Air Asia, Parkson, Shangri-la Group, Sime Darby and UMW.

Beside food and beverage products, what else have good prospects in China? Some of Malaysian ICT companies have also made inroads into China with their unique services that can cater the need of ICT customers; like softwares, solutions, creative multimedia contents,etc. We read in the media that such companies as Green Packet, Cworks Berhad and Mobif Berhad have ventured into China market. If Malaysian enterprises can offer some special and unique ICT services that can fulfill the increasingly ICT savvy customers in China, then they have a good chance of success.

The above are just some instances of what products or services that Malaysian enterprises can offer for China customers.

As I mentioned earlier, one of critical success factors of doing business in or with China is a credible partner in China. It is a challenge if you want to do everything by yourself but it would be more realistic if you work together with a reliable partner to achieve a success. How?

There are many ways to find a good partner. It may come from recommendations from other people that you know well, from government agencies that can advise you like Malaysia External Trade Development Corporation (MATRADE) or Malaysian overseas missions. Another common and relatively effective way to look for partners is through participations in international exhibitions overseas. In fact, though this is a traditional way of promoting your products and services internationally, these events are still much relevant to those who are especially new in international market. During participation in the exhibitions, you not only can introduce your products but also can establish contacts with potential partners who come and visit your booth.

You may receive hundreds or even thousands of visitors during the period of exhibition and many of them probably interested in your products/services and interested to become your partner; in the form of distributorship or importing. Then come another challenge; from all these interested potential partners, who will be the right partner(s). Let's see if you want only a sole distributor of your products for China market, how do you choose the 'right' partner from many. You then need to assess the credibility and reliability of this partner, via many ways, including via your already existing contacts in China, internet, local commercial authorities in China like Ministry of Commerce (MOFCOM), China Council for the Promotion of International Trade (CCPIT), municipal bureau of trade and investment as well as Malaysian representative offices in China like MATRADE, MIDA, and Malaysian overseas Embassies/Consulates.

This proper due diligence is essential to be conducted before a final selection of a partner is made. One thing for sure your partner should not show genuine interest in your products but also should be supportive to you to overcome regulatory hurdles for your product to enter China market and work closely together in marketing and promotion activities for your products to gain customers' acceptance. Sure you do not want parners that can give 1001 promise before they get the business but later end up failing in the market or you do not want  partners who say everything 'no problem' but after the deal sealed, then you realise that there 'are many problems'.

So, finding the right partner is important. It is not easy but you have to if you want to succeed in business. This applies not only for China market but also elsewhere.

What else important beside finding a right partner? Next, do you have the right product or services for China market? This is from the perspective of selling products/services to China.