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Smart folks invest in China. Western economies are struggling because they are so highly indebted because they don't wanna work hard. Chinese have strong Confucian values. Shanghai is indeed the place to be
Published November 11, 2010
SINGAPORE INTERNATIONAL
Shanghai is where it's at
More and more Singapore companies are establishing a presence in China's biggest city, reports CHUANG PECK MING
SHANGHAI, with a population of 18.8 million people, is China's biggest city and the world's most populous 'city proper'. And with more than 7,000 Singaporeans known to call it 'home', it boasts the biggest Singaporean community in China.
This presence reflects Shanghai's economic importance to Singapore companies - an importance tipped to grow with the city's rising affluence, which is already fanning demand for high-end goods and services.
Shanghai's gross domestic product jumped 8.2 per cent between 2008 and 2009 to 1,490.09 billion yuan (S$287.5 billion).
Liane Ong, regional director for East China, China group at International Enterprise (IE) Singapore, sees opportunities in consumer-related sectors and logistics for Singapore companies. These include firms in the retail, food and beverage, and hospitality sectors.
IE Singapore, the government agency that is pushing Singapore companies to venture abroad, launched a 'Tasty Singapore' food campaign this year in Shanghai, Guangdong province, and Beijing.
'This idea was to introduce Singapore's food products and the Tasty Singapore brand to Chinese consumers and businesses through supermarket promotions,' says Ms Ong.
What's more, IE Singapore is getting Singapore fashion retail and F&B companies in Shanghai to help other Singapore companies study the city's market potential. The trade promotion agency is also looking out for openings in Shanghai to showcase Singapore's fashion and food concepts.
'Some Singapore-based companies have tapped on this to break into Shanghai,' Ms Ong says.
She singles out retail footwear chain Charles & Keith, which opened its first concept store at Raffles City Shanghai in April this year. 'It plans to open up to five stores in Shanghai in the near- to mid-term before expanding to other parts of China,' she says.
Commonwealth Travel Services Corporation (CTC) is another Singapore company that has set up shop in Shanghai this year. It opened a multimedia theatre with an interactive themed restaurant and roof-top dining in May. CTC also manages the Paramount Hotel in Shanghai.
Many Singapore companies arrived in Shanghai long before Charles & Keith and CTC - more than 2,500, according to IE Singapore. Among them: Singapore Technologies in manufacturing; CapitaLand, Jurong Consultants, and Millennium & Copthorne Hotels in infrastructure and real estate; Raffles LaSalle and PSB in education; Sembcorp Utilities and Hyflux in environmental services; Parkway Holdings and Raffles Medical Group in health care; Venture Corporation, Amtek, and Sunningdale in electronics; DBS, OCBC, and Drew & Napier in banking and legal services; NCS and ST Electronics in information technology; and Kriston, Da Vinci, and Bakerzin in retail and F&B.
As of June this year, Singapore companies had pumped US$8.58 billion into 2,944 projects in Shanghai, figures produced by the Shanghai Municipal Commission of Commerce show. In the first six months of this year alone, Singapore companies invested in 73 new projects in the city.
Shanghai's ambition to become a global financial and shipping hub will also create opportunities for Singapore companies.
The authorities are, for instance, dangling tax exemptions to companies engaged in international shipping, cargo transport, and warehousing operations to register at Yangshan Port. Singapore's logistics player YCH recently took the plunge and opened its YCH DistriPark in the Shanghai Yangshan Free Port.
In the drive to help turn Shanghai into a global financial and shipping hub, China's central government has merged Shanghai's Nanhui District with the Pudong New Area - and extended incentives previously reserved for Pudong to the combined district. The Pudong government will also inject 100 billion yuan into urban infrastructure.
But Ms Ong points out that Shanghai is a mature market with rising costs - investors may be putting their money into a saturated market. 'It is, therefore, imperative that companies do thorough due diligence and clearly identify a unique or niche position to differentiate themselves from competitors,' she says. 'They should also focus on high value-added services or businesses, instead of labour or land-intensive ones.'
Indeed, some multinational corporations are already shifting their factories to lower-cost inland cities - though Shanghai remains an ideal location for headquarters operations.
Still, Ms Ong says business potential remains high in Shanghai. 'In line with the government's development plans, we see opportunities in the higher value-added, modern services industries such as consumerism, financial, master-planning, hotel management, transport, and logistics,' she says.
The development of Pudong and the upcoming Disneyland will also offer new opportunities for Singapore companies to 're-engage' Shanghai, she believes.
Published November 11, 2010
SINGAPORE INTERNATIONAL
Shanghai is where it's at
More and more Singapore companies are establishing a presence in China's biggest city, reports CHUANG PECK MING
SHANGHAI, with a population of 18.8 million people, is China's biggest city and the world's most populous 'city proper'. And with more than 7,000 Singaporeans known to call it 'home', it boasts the biggest Singaporean community in China.
This presence reflects Shanghai's economic importance to Singapore companies - an importance tipped to grow with the city's rising affluence, which is already fanning demand for high-end goods and services.
Shanghai's gross domestic product jumped 8.2 per cent between 2008 and 2009 to 1,490.09 billion yuan (S$287.5 billion).
Liane Ong, regional director for East China, China group at International Enterprise (IE) Singapore, sees opportunities in consumer-related sectors and logistics for Singapore companies. These include firms in the retail, food and beverage, and hospitality sectors.
IE Singapore, the government agency that is pushing Singapore companies to venture abroad, launched a 'Tasty Singapore' food campaign this year in Shanghai, Guangdong province, and Beijing.
'This idea was to introduce Singapore's food products and the Tasty Singapore brand to Chinese consumers and businesses through supermarket promotions,' says Ms Ong.
What's more, IE Singapore is getting Singapore fashion retail and F&B companies in Shanghai to help other Singapore companies study the city's market potential. The trade promotion agency is also looking out for openings in Shanghai to showcase Singapore's fashion and food concepts.
'Some Singapore-based companies have tapped on this to break into Shanghai,' Ms Ong says.
She singles out retail footwear chain Charles & Keith, which opened its first concept store at Raffles City Shanghai in April this year. 'It plans to open up to five stores in Shanghai in the near- to mid-term before expanding to other parts of China,' she says.
Commonwealth Travel Services Corporation (CTC) is another Singapore company that has set up shop in Shanghai this year. It opened a multimedia theatre with an interactive themed restaurant and roof-top dining in May. CTC also manages the Paramount Hotel in Shanghai.
Many Singapore companies arrived in Shanghai long before Charles & Keith and CTC - more than 2,500, according to IE Singapore. Among them: Singapore Technologies in manufacturing; CapitaLand, Jurong Consultants, and Millennium & Copthorne Hotels in infrastructure and real estate; Raffles LaSalle and PSB in education; Sembcorp Utilities and Hyflux in environmental services; Parkway Holdings and Raffles Medical Group in health care; Venture Corporation, Amtek, and Sunningdale in electronics; DBS, OCBC, and Drew & Napier in banking and legal services; NCS and ST Electronics in information technology; and Kriston, Da Vinci, and Bakerzin in retail and F&B.
As of June this year, Singapore companies had pumped US$8.58 billion into 2,944 projects in Shanghai, figures produced by the Shanghai Municipal Commission of Commerce show. In the first six months of this year alone, Singapore companies invested in 73 new projects in the city.
Shanghai's ambition to become a global financial and shipping hub will also create opportunities for Singapore companies.
The authorities are, for instance, dangling tax exemptions to companies engaged in international shipping, cargo transport, and warehousing operations to register at Yangshan Port. Singapore's logistics player YCH recently took the plunge and opened its YCH DistriPark in the Shanghai Yangshan Free Port.
In the drive to help turn Shanghai into a global financial and shipping hub, China's central government has merged Shanghai's Nanhui District with the Pudong New Area - and extended incentives previously reserved for Pudong to the combined district. The Pudong government will also inject 100 billion yuan into urban infrastructure.
But Ms Ong points out that Shanghai is a mature market with rising costs - investors may be putting their money into a saturated market. 'It is, therefore, imperative that companies do thorough due diligence and clearly identify a unique or niche position to differentiate themselves from competitors,' she says. 'They should also focus on high value-added services or businesses, instead of labour or land-intensive ones.'
Indeed, some multinational corporations are already shifting their factories to lower-cost inland cities - though Shanghai remains an ideal location for headquarters operations.
Still, Ms Ong says business potential remains high in Shanghai. 'In line with the government's development plans, we see opportunities in the higher value-added, modern services industries such as consumerism, financial, master-planning, hotel management, transport, and logistics,' she says.
The development of Pudong and the upcoming Disneyland will also offer new opportunities for Singapore companies to 're-engage' Shanghai, she believes.
