Editor's Note:

As the 18th National Congress of the Communist Party of China, which opened on Nov 8, continues in Beijing, China Daily asked a number of top executives from international companies to give their impressions of the event and their expectations for the country. We asked five questions, and the answers we were given showed great confidence in China and its business environment under the country's new leadership, set to be elected at the congress.

The scale of the opportunity of China is clear: by 2025 there will be 221 cities of more than 1million people, compared to 35 in Europe today. In my opinion, looking into the coming decade, the economy growth of China may be slowing down a bit compared with itself during the last decade, but compared with other countries in the world it still remains a relatively fast speed.

Given the huge potential I think that China will still be an important growth engines and one of the most strategic markets of the global economy and of Tesco as well.

We are committed to China and remain determined to develop a leading position in a market of such potential.

Like everybody else we are operating in an economy which has seen slower growth alongside inflationary pressures and we are taking a more measured approach to our expansion as a result. Nevertheless Tesco still plan to open 16 new hypermarkets during this fiscal year (March 2012 - February 2013) in China, which is more new hypermarkets than anywhere else in the Tesco group and more new space as a proportion of our base than any other major retailer in China..

We've always said that China represents a significant strategic opportunity for Tesco, albeit a complex one.

Tesco continues to believe that China can be an engine of growth for the company.

Our commitment to developing a growing and profitable business in China for the long-run remains strong. The fundamental long-term attractions of China are clear and we are working to ensure we are well placed to take advantage of the opportunity.

The retail industry does see some challenges this year, however, Tesco remains confident of the future outlook since the industry itself is fundamental and indispensable for everyone's daily life thus is of vital importance and huge prospect.

As one of the most important markets and the second economy of the world, China always has innovation and courage in the face of challenges, which help companies in China to achieve further development.

As a company, we have a shared interest in creating an innovative business environment in which ideas and experience can be exchanged between business people and policy makers, so that the right kind of policies can be developed and the right and profitable investment decisions can be made likewise.


We anticipate the continuous innovative measures from the new leadership to further help create a more favorable business environment.

From the perspective of foreign-invested retail enterprises in China, Tesco believes one of the essential measures is to continuously build a service-oriented government, so as to enhance the cooperation and communication with international businesses in order to further build up China's soft power and ensure sustainable development.

----- Paul Ritchie

Tesco China CEO

Yes, We believe in the long run, China will see steady sustainable growth, though not as fast as what we seen in the past decade. There are differences by sector and by region which are important. China will continue to be a key growth engine for us and our clients as an integral part of a One World Strategy.


No, on the contrary, we will increase our investment in China. China's economy is maturing, and its industry is starting to shift away from a focus on low-cost manufacturing towards higher-value-added business. We see strong growth available in some sectors and in lower tier markets, and a heightened need for performance improvements in sectors which have slowed and have excess capacity.

We are leveraging our experience in more mature markets to help our clients in China with more sophisticated strategies with aligned capabilities and cost structures to deliver profitable growth.

In the next 5 years, we anticipate to more than double in size in China. This is a critical time for many companies, and we do increasingly see our need for consulting support from our clients for real practical strategies and support on translating the strategy into execution. We are helping many clients become "Fit for Growth" and building the capabilities to have a sustainable profitable business in China.

For us, like our clients, attracting and retaining top talent is critical, which requires a long-term commitment to China with a compelling vision and sense of purpose. For us this centres on pride in the impact we can have helping our clients build capabilities to win in China, combining the best of deep China insight with global capabilities to deliver results.

We still see some short-term uncertainty and "wait and see" in some companies in China. We expect with the leadership transition in China that there will be more certainty and confidence in the long-term fundamentals of China's economy, even though there will be challenges ahead in the next stage of China's growth and development.

----- Sarah Butler

Managing Director, Booz & Company Greater China

Booz & Company Board Director

Not at this point, why, because when the cost of labor goes up, the needs for automation goes up, which means you need IT, you need more software. So ICT benefits from the increase in average salaries, because it drives modernization. When we visit data centers and factors in China, we see a very good interest in modern tools for efficient production. So for us, we don't directly hit by this factor.

We are more and more optimistic. We launched the "Conquest 2015" plan in 2010. One of the four strategic objectives is to generating 1 billion euros in revenues in emerging countries, by both supporting international customers with the development of their activities in these countries and strengthening our own presence alongside local multinationals.

We have a core business, which is providing international networks for large multinationals. As globalization continues, large multinationals continues to build new offices, new factories, new shops in other countries, so you need to connect them. We also felt, that there is more to be done. We can go into services and that's an expansion towards a new era of effectivity on top of network. We also provide call center services, cloud computing services. We help customers to use modern technologies through cloud, through remote access etc. We met good response from Chinese customers. For example, we signed deals with 360buy.com, a leading e-commerce website in China, in areas of call center solutions. The core business is what we defend, we continue to support multinationals and grow our services.

The other part of "Conquest 2015" is to focus on emerging companies that begin to be international. The new Chinese MSEs, those new tigers, that are going to expand across the world by opening new factories, new offices, etc. One of the areas that we focus on is investment between China and Africa. Many Chinese companies have made investments in Africa in the past 2 to 3 years. Orange Business Services can offer direct link on telecom bases between Africa and China. We provide more effective technical solutions, such as shorter electronic travel time, in supporting these companies.

That's our strategy and it is working. These are the areas we want to focus on and they are delivering results. In spite of the macroeconomic factors you mentioned, companies needs call centers, companies don't want to build data centers on their own. They would rather leave IT work to be managed by a big company.

I think the biggest concern that we have is to really understand customers' needs. The biggest risk is misunderstanding in businesses. What we sell is technically complex. For example, you build a call center in Europe, you build a call center in China, largely it is the same, but not quite. We want to make sure our products and solutions work well with customers.

The ability to really grasp customers' needs is one of the tough points, so that's why we try to hire smart people who listen well, have experiences, discuss with customers and bring the right answer.

The competitiveness challenge will continue to require investment in digital technologies. I know some provinces in China have made efforts to bring in data centers, cloud computing etc. I think the encouragement to invest in these areas (is important), so we can provide cloud computing solutions.

The openness to technologies that are international, so that have seamlessness, so that Chinese companies can have the same solutions in China and when they go abroad. These are the things to work on and we will certainly support that. Bringing international technologies in the digital area, we do believe that generate the economic scale and good process management.

----- Vivek Badrinath

CEO of Orange Business Services

executive vice president in charge of Enterprise Communication

Entering China market in 1985 with the delivery of an A310 aircraft to what it is China Eastern Airlinestoday, Airbus has been witnessing the fast and steady economic growth of China.

In the field of aviation, in particular, we having been feeling the growth as Chinese airlines are introducing more and more the world's most advanced aircraft and more and more Chinese aviation industry companies are fully involved in the worldwide supplier networks of the world's most advanced aircraft programmes.

Take Airbus' development in China as an example, the number of Airbus aircraft in operation in China has increased to some 850 from only 20 in 1995.

What's more, there are more and more wide body aircraft in service with Chinese airlines. For example, there are around 100 Airbus A330s in China and four A380s, the largest commercial passenger aircraft in the world.

In the mean time, Chinese aviation industry companies have been playing an increasingly important role in the supply chain for Airbus aircraft programmes. So far, there are parts and components produced in China on every Airbus commercial aircraft type. Six Chinese manufacturers are already involved in manufacturing parts for Airbus aircraft. Chinese companies have also been involved in the design of Airbus latest aircraft programmes.

In the past decades Airbus has expanded its presence in China. In 1994, Airbus China Company Limited was officially established and Airbus China Beijing Representative Office started operation. So far, in addition to the representative office, Airbus has four joint-ventures in China, namely the Hua-Ou Aviation Training and Support Centre and the Airbus (Beijing) Engineering Centre, which are located in Beijing, the Airbus A320 Family Final Assembly Line China (FALC) located in Tianjin and the Harbin Hafei Composite Manufacturing Centre located in Harbin, as well as the Airbus (Tianjin) Delivery Centre, an Airbus subsidiary located in Tianjin. The total number of Airbus and joint-venture staff in China is over 1,200.

Looking to the future, we are strongly confident in China's economic growth and its contribution to the world's economy. A seven percent GDP growth is still at the leading position of world's economic development. Considering the size of Chinese economy today is much larger than that 10 years ago, a seven percent GDP growth means a lot.

According to Airbus Global Market Forecast, in 20 years from now, China's domestic passenger traffic will overtake the US domestic traffic to become the number one traffic flow. For the Chinese mainland alone, in the next 20 years, the demand for new passenger and freight aircraft will reach nearly 4000, including some 2,700 single-aisle aircraft, 1,100 twin-aisle aircraft and more than 200 very large aircraft. The total market value will reach $543 billion.

Our cooperation projects have been supported by Chinese governments. For example, the Airbus Tianjin Final Assembly Line, a joint venture between Airbus and the consortium comprising Tianjin Free Trade Zone and AVIC, has been praised as a “paradigm for Europe-China cooperation”. We have delivered more than 100 aircraft from Tianjin. The FALC is ramping up its production. Our joint venture in Harbin, Hafei Airbus Composite Manufacturing Centre, will provide half of the total rudders for Airbus A320 Family from 2014.

Last year, we delivered some 20% of our total production in the year to China and this year we keep this momentum to deliver more than 120 new aircraft to China. We keep our commitment to the long-term development of Chinese aviation industry and are seeking more cooperation projects not only in the manufacturing sector but also in other areas such as environment protection and air traffic management.

Airbus is confident in the future of China's economic development and we are committed to supporting the development of China's aviation industry, as always.

----- Laurence Barron

President of Airbus China

Even with the recent "slow down" in the growth of China's economy, the country is still experiencing a very rapid rate of economic growth compared to the rest of the world.

Bombardier Aerospace has every confidence that China's Leadership has the knowledge, tools, and clear determination to continue to successfully guide the country's historic economic miracle forward at a rapid and sustainable rate, in an environmentally friendly manner. China remains a central focus of our company and our future strategy.

No. In fact, having opened up a new North Asia Regional Headquarters for our Commercial Aircraft business unit in Shanghaiin early 2012, we continue to staff the office with new hires. Additionally, we are expanding our industrial, maintenance, and training efforts in China.

We expect the aviationindustry in China to continue to grow at a rapid pace. GDP is increasing, and many Chinese people need to travel in their daily lives for work and to reunite with family and friends. The freedom of movement provided by a mature commercial aviation network is important for improving people's lives and well-being and a key part of economic development. Bombardier is growing our supply chain and technical presence in China and will continue to do so for at least the next 5 years.

Our biggest concern is how to continue to attract, retain, and motivate our growing team of employees in China. We can always do better. It is key that we hire the most talented people and train them for the future. Our people are our most important asset.


We are very encouraged that the new Leadership in China will act swiftly to allow for the rapid, yet orderly, growth of regional aviation. We are fully confident that, under the enlightened and diligent oversight of the CAAC and NDRC, Chinese aviation can continue to grow rapidly and safely.

There are many business models to be used as examples in North America and Europe for the optimization of air travel between smaller and remote locations using Bombardier Aerospace and other regional aviation OEM's products. We would hope we can continue to develop these models in China to improve people's lives and assist in developing the aviation economy, with the new Leadership's support.

----- Andy Solem

vice president, sales, China & North Asia

Bombardier Commercial Aircraft

Yes, I believe China can maintain a fast economic growth in the future, at least for another five years. And China will be one of the most important growth engines for the global economy. For our global business, China is the fastest growth country.

As China's economic growth slow down, our business growth will also see a slow down. But we will continue to invest significantly and hire new staff at all levels in China. The only way to grow our business, in fact, is to add staff.

Our revenue will continue to be strong by capitalizing on expanded market shares that could be done either by wining new business, provide more types of services for our old clients and gain business from our competitions.

In a recent survey we carried out, around 83 percent surveyed said auditing services concentrated on a few service providers, and they want a more diversified market.

Our biggest concern in doing business in China is to find qualified talents and maintain them.


We hope the new leadership will continue to create an environment to support the business growth of foreign enterprises and promote a further integration with the global economy.

----- Edward E. Nusbaum

Chief Executive Officer, Grant Thornton International

As the global leader in water, hygiene and energy technologies and services, Ecolab is well positioned in China, one of the most promising markets in Asia, to partner with key stakeholders (government, customer, media, and key opinion leaders) to drive food safety and solve water, energy related sustainability issues through continuous innovation and seamless customer service.

Ecolab's business focuses on providing and protecting safe food, clean water, abundant energy and healthy environment, none of them will be impacted by GDP growth.

Our commitment in China is here for the long term, we will not change our strategy because of short term economic environment. Ecolab first came to China 30 years ago. Over the last three decades, Ecolab's growth in China has outpaced GDP and overall industry growth. Our business in China has been the highest growth business in Ecolab globally.

Although Chinese economy is going through a challenging time, we are still optimistic in this market as we are confident in the long term development of China market. In fact, some of our best investments were made during the down time. For example, we opened a brand new, state of the art factory in Taicang, a city one hour away from Shanghai, to manufacture food safety, cleaning and sanitation products. We expanded our facility in Nanjing to serve water treatment, paper and energy service markets. We also invest in a R&D center in Shanghai to focus on both global and local innovation.

Regarding China’s economy, we have seen a slowdown especially in infrastructure related industry. However, we still see a healthy, if not robust, growth in consumer related industries. We also see market stabilize in recent months, although still in a low point of industry cycle. We have yet seen a significant reduction in inventory level in most of the industries, which is concerning. Chinese government has approved $1T infrastructure related investments which will take time to go through system and impact downstream industries.

In the long run, China is going to evolve from an investment and export driven economy to more domestic consumption and service driven economy. Government has put more emphasis on sustainable development of the economy, people care more about food safety and environmental protection. All these trends will benefit Ecolab, a leader in food safety, water management and energy technology.

----- Tim Wang

Senior Vice President & General Manager of Ecolab Greater China