It would be foolish, he said, for the UK not to engage in trade with a country that boasts most of the leading technologies of the 21st<\/sup> century. He also emphasised that Chinese savers and consumers were eager to put their savings into wealth management, insurance and pension products designed and spearheaded here in the UK.<\/p>\n Sir Sherard Cowper-Coles giving his keynote address<\/p><\/div>\n During the keynote addresses, delegates also heard from Bim Afolami<\/strong>, Economic Secretary to the Treasury<\/strong>, who said that the UK government is committed to growing the China relationship and working together on global challenges, particularly climate change, infrastructure and supply chain resilience.<\/p>\n He noted that China\u2019s commitment to achieving carbon neutrality by 2060 will require an estimated \u00a317-35 trillion of investment, 90% of which will come from the private sector, and the UK has set a target to become the first net zero financial centre.<\/p>\n Chinese Ambassador to the UK Zheng Zeguang<\/strong> said that \u201cof course, there have been ups and downs in our relations, but the overall trend has been upward and forward.\u201d<\/p>\n He pointed out that the policies set out in China\u2019s annual Two Sessions can be summed up in four keywords: confidence, development, openness and cooperation.<\/p>\n The first is confidence in the country\u2019s economic prospects, with a target of 5% GDP growth this year.<\/p>\n \u201cThe long-term trajectory of China\u2019s economy remains positive, as it enjoys the following unique strengths: strong political leadership, a supersize market, a full-fledged industrial system, abundant, high-calibre labour forces, and constantly improving sci-tech innovation capacity,\u201d he said.<\/p>\n The second point is development. \u201cChina is firmly committed to advancing high-quality development and the Chinese path to modernisation,\u201d said Ambassador Zheng. \u201cMarked by innovation, these forces will help transform traditional industries, making them more advanced, intelligent and environmentally friendly.\u201d<\/p>\n Ambassador Zheng Zeguang, Chinese Ambassador to the United Kingdom, giving his keynote address<\/p><\/div>\n \u201cChina has some 400,000 high-tech companies and ranks second globally in terms of number of unicorn start-ups. Of the 153 \u2018lighthouse factories\u2019 on the Global Lighthouse Network released by the World Economic Forum, 62 are Chinese.\u201d<\/p>\n The third is openness. \u201cChina will pursue higher-standard opening up and promote mutual benefits,\u201d said the Ambassador. \u201cWe will promote alignment with high-standard international economic and trade rules, steadily expand institutional opening up, and amplify the interplay between domestic and international markets and resources. We will ensure the overall stable performance of foreign trade and foreign investment and foster new strengths in international economic cooperation and competition.\u201d<\/p>\n The fourth and final word was cooperation. \u201cFacts have proven that China\u2019s development provides a vast market, high-quality and affordable products, increasingly advanced technologies, and, of course, much-needed investment for the world. Last year, China contributed to around one-third of global growth. China\u2019s development will continue to inject stability and impetus into the world.\u201d<\/p>\n \u201cOver the years, CBBC has served as an important bridge for China-UK communication and a strong catalyst for China-UK cooperation. We look forward to closer cooperation with CBBC and the British business community going forward,\u201d he said.<\/p>\n The first of three plenary speakers was Christopher Davies<\/strong>, Deputy Chief Executive Officer, HSBC Continental Europe<\/strong>, the largest foreign bank operating in China. Davies said that although not everything is rosy in this trade corridor, he sees reasons for optimism and pools of opportunity. \u201cGrowth of 5% will take all sorts of efforts, but our view in the medium term is that there is plenty of growth ahead due to basic demographics,\u201d he said.<\/p>\n According to HSBC\u2019s annual China Sentiment Survey, 87% of clients were planning on expanding their business in China, indicating that support for investment was there. Davies said there was a bias towards tech-heavy sectors, sustainable energy, and electric vehicles and their supporting sectors and digital services. He also noted that it was UK businesses who were foremost in their positivity towards China.<\/p>\n Opportunities also exist for UK companies in the financial services sector. Eighty million more people will join the middle-class segment by the end of the decade, taking China\u2019s middle class to 40% of the population. This middle class will bring with them \u201can appetite for quality wealth management\u201d.<\/p>\n Davies also said that sustainable financing and inbound investment into sustainable technologies in the UK are very strong opportunities.<\/p>\n Jinny Yan addressing the delegates at the forum<\/p><\/div>\n Jinny Yan, Managing Director, ICBC Standard Bank<\/strong>, talked about the new buzzword that came out of the annual Two Sessions: \u2018New Productive Forces\u2019. She broke the phrase down into \u2018three highs\u2019 \u2013 high quality, high efficiency and high technology \u2013 and \u2018three news\u2019 \u2013 new supply chains, new industries and new digital economy.<\/p>\n China\u2019s economy, Yan said, was shifting from high quantity to high quality. An ageing population limits growth, so in order to invigorate the economy, China needs to find new growth engines. To date, this has included moving away from investment to consumption. China\u2019s post-Covid recovery, she said, was largely down to consumption with a focus on necessities rather than luxuries.<\/p>\n China is also \u201crethinking how to make its growth model and supply chains more resilient to external forces,\u201d she said. The next phase of Chinese growth will be in new energy, healthcare, biosciences, and supply chains.<\/p>\n She also said there is a trend for commodity transitions to be settled in RMB, from which financial centres such as London and Singapore will benefit as the world\u2019s second-largest economy continues to open up and China\u2019s currency internationalises.<\/p>\n Gordon Orr speaking at the forum via video link<\/p><\/div>\n Gordon Orr<\/strong>, Non-Executive Director of Swire Pacific, Meituan, Lenovo and EQT<\/strong>, provided a number of examples of British companies that are continuing to grow in China, mentioning that IHG has opened 100 hotels in China in the past year, bringing their total to over 700 hotels \u2013 with plans for another 500 in the pipeline. Merlin will open two of the world\u2019s largest Legoland parks in China, and Swire has acquired interests in private hospitals in China. Fidelity has raised over \u00a3700 million for a fixed mutual fund, and Schroders has a license to run a 100% private investment facility. AstraZeneca continues to invest hundreds of millions into China and has licensed obesity drugs from China.<\/p>\n All this, he says, \u201cis happening during an economic reset, and whilst the challenges in the housing market have led to reduced consumer confidence.\u201d Although many SMEs have not recovered as well as larger companies, every industry transition \u201cwill always create losers as well as winners,\u201d Orr said.<\/p>\n Orr also said there has never been a better time for finding talent from China, especially within the STEM sector, where grads are looking for stable roles in international companies.<\/p>\n The first panel of the day was on the energy transition<\/p><\/div>\n The first of the UK-China Business Forum 2024 panel discussions was on the energy transition. CBBC\u2019s James Brodie moderated the talk, noting that China has invested huge amounts into green energy and that green energy production overtook coal power energy in June 2023.<\/p>\n Bill Ireland, CEO, Logan Energy<\/strong>, explained that if we want to achieve net zero by 2050, companies and countries need to work together to enable the shift from oil and coal that has dominated for the last 150 years to new technologies. Logan Energy has been working on a number of projects, including exporting hydrogen refuelling stations; decarbonising the Yangtze and converting marine vessels on the famous river; working with fuel cell companies; and helping Chinese companies to comply with EU regulations, enabling them to export to the EU market.<\/p>\n \u201cOur strategy is partnering with the right people in the right way, and Chinese manufacturers are likely to meet that game,\u201d says Ireland. Ireland said that he is excited about the \u201cboundless\u201d opportunities around energy transition and China. He emphasised that Chinese investment and support are paramount to achieving net zero and reducing CO2 emissions. \u201cWe don\u2019t have the capacity to meet the demand [for net zero technologies] in the UK,\u201d he said. \u201cIt\u2019s a symbiotic relationship we need to have.\u201d<\/p>\n Federica Berra, Senior Vice President, Air bp<\/strong>, explained how Air bp has been working to create and distribute sustainable aviation fuel (SAF). \u201cThe aviation business is expected to double by 2040 as the middle class rises and more people fly,\u201d she said. \u201cAnd aviation represents 2% of global carbon emissions and 12% of transportation sector emissions.\u201d<\/p>\n She said that we will see hydrogen, battery and electric aeroplanes providing short to medium-haul flights, but they all require new aeroplanes. For long-haul flights, \u201cdrop-in\u201d SAF fuel is needed, which means aeroplanes don\u2019t need to be altered. Next year, 2% of all fuel must be SAF, but current regulations limit the amount of SAF that can be put into a plane to just 30%.<\/p>\n Berra recently flew from London to New York on a Virgin aircraft with Rolls Royce engines that was 100% fuelled by bp SAF, proving that the technology is there. And with bp in 40 countries and 600 airports, it\u2019s now up to the regulators to further encourage SAF usage internationally.<\/p>\n Eugene McKenna, Hydrogen and Sustainable Technologies Director, Johnson Matthey<\/strong>, helps businesses pivot towards the clean energy transition and works with bp on SAF production and distribution.<\/p>\n \u201cWe need supply, transportation, storage and demand all to develop at the same time. China is solving those market challenges better than the West because it is mandated,\u201d he said. McKenna is also pushing for global cooperation. \u201cEvery ton of CO2 avoided anywhere in the world is avoided on behalf of all of us. It helps us equally regardless of where it is collected from,\u201d he said.<\/p>\n Yin Noe<\/strong> is Head of UK & EU <\/strong>for the YRD Automotive Alliance<\/strong>, an alliance of over 500 Chinese automotive manufacturers that was created to promote the electrification of vehicles and the national grid networks. Its extensive experience over the last two decades now sees it helping EU and UK companies transition to electrification.<\/p>\n \u201cChina invested billions of dollars 15 years ago to make EVs affordable,\u201d she said, going on to explain that, unlike Western legacy combustion engine car manufacturers, Chinese car companies started with EVs, and thanks to investment and many years of experience, they now dominate the market. However, she says, there is still resistance to working with Chinese OEMs, with concerns over quality and industrial espionage. The question is: do we want a carbon-zero future, or do we want to protect EU legacy brands?<\/p>\n Paul Taylor, Chief Advisor, CRRC Times Semiconductor Co. Ltd<\/strong>, said that \u201cwe have to become more receptive to Chinese products. Some people are [living in the past], and their perception is guided by that. China supplies the highest quality, lowest cost products and has what we need to achieve net zero,\u201d he said.<\/p>\n Taylor went on to explain that the long history and government support of Chinese EV manufacturing has made it the most competitive and safe in the world. For example, CRRC was originally a bullet train manufacturer, but it has now moved into EV and electric bus manufacturing. It invested in Taylor\u2019s semiconductor company in 2007 to ensure it owns the full supply chain from microchip to finished vehicle.<\/p>\n \u201cIn China, the state decided a long time ago to focus on EV manufacturing and technology, but in the UK, it\u2019s very slow and constrained because of policy,\u201d Taylor said. \u201cBusinesses cannot connect to the grid; the government needs to wake up and put its foot down.\u201d<\/p>\n Ireland agreed: \u201cIf 2% of people in London wanted to charge at 100kw, the grid would fall over. We need to wake up and realise we need both finance and policy,\u2019 he said.<\/p>\n The second panel of the day was on managing your China business<\/p><\/div>\n The next panel asked why people choose to have a presence in China and explained the various options to do so, whether that be a wholly foreign-owned enterprise, a representative office, or a joint venture and third party.<\/p>\n The panellists noted that the choice of the above was very much dependent on the type of business. For example, representative offices are less popular than they once were but are still popular with real estate firms. Having partners in some form is often preferred to help navigate restrictions and regulations, but, of course, partners need to be incentivised.<\/p>\n Kristina Koehler-Coluccia, Head of Business Advisory, Woodburn Accountants & Advisors<\/strong>, explained that building a structure and tax planning is crucial. There are tax incentives in certain districts that are good to take advantage of, but companies need to be cautious about the time limits on these when budget planning.<\/p>\n Duncan Levesley, Director, Public Services Advisory, Grant Thornton UK<\/strong>, agreed that taxation is often a key area that businesses find complex and can deter new starters. However, he said that China\u2019s tax system is within global standards, and there are key taxes that are similar to the UK model.<\/p>\n Cross-border payments and the distribution of dividends are other areas that are complicated for companies with a hybrid of goods and services, but there are experts available to support this. Levesley also noted that having more local recruitment provides a better understanding of the local market than having head office transfers.<\/p>\n CBBC\u2019s Ben Rotheram<\/strong> said that recruitment is an important part of building a successful business and that LinkedIn is still a viable platform, as many Chinese professionals use the site despite it having officially exited the China market.<\/p>\n The panellists also agreed that the infrastructure around intellectual property and regulation in China has come on leaps and bounds in recent years but is still an important area that companies need to be well versed in.<\/p>\n David Roth, CEO, The Store \u2013 WPP, Chairman BAV<\/strong>, said that building an understanding of how your business fits into the market is crucial. Consumer behaviours are constantly changing, especially in China, and that shapes the business climate. Roth gave the example of how experiential retail and service-driven retail experiences have become paramount in recent years.<\/p>\n The third panel of the day was on healthcare and biosciences<\/p><\/div>\n Speaking at the Forum\u2019s third panel discussion, which was moderated by Elinor Greenhouse<\/b>, Senior Adviser, Tech and Innovation, China-Britain Business Council, Sue Welburn, Vice Principal Global Access & Professor of Medical & Veterinary Molecular Epidemiology, University of Edinburgh<\/strong>, emphasised the persistent demand for UK academic partnerships in the fields of healthcare and biosciences.<\/p>\n Hilary Smith, SVP, Corporate & Commercial CGA and CCO Office, GSK<\/strong>, acknowledged the immense scale of the China opportunity but highlighted that innovation must be affordable and address challenges like the ageing population and the growing number of chronic diseases. She said that prevention is the obvious solution, but it is a long-term investment.<\/p>\n For example, a significant amount of funding goes to oncology in China, which leads to a number of products coming to market from China, and there are a lot of opportunities for partnerships. Companies need to look at where there is a need not being met that they can provide. They also need to consider where to compete and where to partner with local companies.<\/p>\n \u201cThe regulatory landscape for fast launch of products in China isn\u2019t there yet – it has such a differentiated regulated landscape,\u201d she says. \u201cHowever, Hong King, via the Greater Bay Area (GBA), does offer a great opportunity for a fast first foot into the market,\u201d Smith said.<\/p>\n Mark Hedley, Deputy Head of Investment Promotion, InvestHK<\/strong>, said that there has been a boom in the Hong Kong life sciences ecosystem since Covid. Hong Kong has the oldest life expectancy in the world and has similar demographic and ageing populations to mainland China, but it has an easier regulatory framework to operate in, has easy access to funding due to being in a financial capital, and offers tax rebates. Moreover, due to Chapter 18A, companies have the potential to launch on the Hong Kong Stock Exchange pre-revenue.<\/p>\n Hong Kong\u2019s location gives companies the ability to leap into Mainland China via the GBA and gain larger datasets. \u201cHong Kong has four hospitals that allow trials from which you can launch into market, and as part of the GBA, there are a further 19 hospitals that can be entered without regulatory clearance,\u201d Hedley said.<\/p>\n Welburn pointed out that one of the gaps in the biosciences field in China is early career researchers from universities, and this is one area where the UK and China can work together, as the UK produces lots of post-grads who are looking to develop a business.<\/p>\n However, Welburn cautioned that a balance needs to be struck between collaboration and competition. Subsidies in China are enormous, which can be problematic as it is hard to bring partnerships to the table when one side is heavily subsidised and the others are not. Previously, she said, research was based on equal funding but that doesn\u2019t work with China.<\/p>\n David Game, VP Global Product for Medical Education, Elsevier<\/strong>, works closely with AI in the sector, including innovation around Apple and its Vision Pro headset. Even though the headset is not on sale in China, the country represents the third largest group of owners.<\/p>\n \u201cWithin the area of AI, we see ourselves as a trusted provider of high-quality data. In terms of building AI projects in China, the challenge is around copyright. What copyrights we hold outside China is different to China as it\u2019s a different regulatory regime between the US and China,\u201d he said.\u00a0<\/strong><\/p>\n The final panel of the day was on supply chain management<\/p><\/div>\n The importance of supply chains to the global economy couldn\u2019t be more pronounced following the challenges of the Covid pandemic. The fourth panel of the day, which was moderated by Lise Bertelsen<\/b>, Executive Director, Public Affairs, China-Britain Business Council, emphasised that from micro-SMEs to MNCs, supply chains involve multiple components and can be complex systems ranging from planning and sourcing to the production and delivery of goods and services.<\/p>\n As a result, supply chain management can be costly, so it is important to understand ROI and logistics. Organisations like CBBC and The Institute of Export and International Trade have the resources and network to support companies in this, and using third parties for advice can be a key component to market entry.<\/p>\n During the panel, Jane Liang, Chief Procurement Officer, Diageo<\/strong>, highlighted that setting up an R&D centre in Shanghai in 2023 \u2013 which was an industry first \u2013 has allowed Diageo to create a localised and customised understanding of the China market. It is also able to source materials locally and have staff on the ground to manage processes, ensuring efficiency.<\/p>\n Marco Forgione, Director General, The Institute of Export and International Trade<\/strong>, acknowledged that geopolitical issues are turning some companies or countries away from offshore supply chains due to recent disruptions. However, his view is that this is unlikely to happen in any meaningful way, as innovations are already allowing for transparency, and alternative routes and collaboration between logistic firms (for example, air and freight) are allowing for dynamic solutions.<\/p>\n James Grayland, International Director, Heighten<\/strong>, emphasised that it is important to do your homework on the regional infrastructure surrounding your supply chains, create your own business plan, carry out risk assessments, and have definitive objectives. It is also worth considering the choice of air, rail or maritime transportation against the backdrop of sustainability and the impact of this on consumer pricing. This is especially the case in the Chinese context, as value for money is increasingly important for consumers facing economic headwinds.<\/p>\n The panel discussion drew to a close by noting that it is vital to understand strategic and economic commitments when looking at your supply chains and that carrying out a risk assessment of external factors, such as geopolitics and competitors, is key.<\/p>\n The forum concluded with a fireside chat between Andrew Seaton and Qing Pan, president and CEO of Jaguar Landrover China<\/p><\/div>\n The UK-China Business Forum ended with a Fireside Chat between CBBC CEO Andrew Seaton<\/strong> and Qing Pan from Jaguar Land Rover<\/strong>. Pan talked about the importance of China in the global automotive market on both the supply and demand side.<\/p>\n He explained that JLR has evolved from a marketing and sales department in China to a full-blown business, with every element of the supply chain, including a key innovation centre, located in China.<\/p>\n Discussing the EV market, Pan said that EVs account for 40% of China\u2019s new car sales \u2013 a much faster uptake than in the West due to early investment by both companies and the government. For example, in 2017, the Chinese government publicised the new emission standards required from car manufacturers, which were only possible to hit if you had a portfolio of EVs.<\/p>\n \u201cPrivate businesses in China know they can\u2019t surpass the 100-year history of combustion engine cars, but they do think they can win the EV model. Why? Because Western companies are in defending positions and juggling two balls in the air. Chinese companies can go all in,\u201d he said.<\/p>\n Seaton pointed out that this is why we have seen tech companies in China \u2013 such as Xiaomi \u2013 launch EVs rather than just the traditional automotive manufacturers.<\/p>\n Seaton and Pan also discussed geopolitics as being a hurdle. If large-scale Chinese investment into the West leads to trade barriers, it will hurt all parties. Trump has threatened to place 100% tariffs on Chinese products as part of economic nationalism, which will have a devastating impact on the EV market and, by extension, the environment.<\/p>\n The event was made possible with the support of CBBC\u2019s sponsors: HSBC, Invest HK, JLR, Standard Chartered, the UK Government Department for Business & Trade, and Deloitte.<\/em><\/p>\n Learn more about the UK-China Business Forum 2024, including the full agenda, list of speakers and speaker biographies here<\/a>.<\/em><\/p>\n Browse photos from the event here<\/a>.<\/em><\/p>\n Keep up to date with CBBC\u2019s events calendar here<\/a>. Learn about CBBC\u2019s membership offer here<\/a>. For further enquiries related to the event, please contact enquiries@cbbc.org<\/a>.<\/em><\/p>\n![\"\"](\"https:\/\/focus.cbbc.org\/wp-content\/uploads\/2024\/04\/JAY_1637-1024x681.jpg\")
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Opening Plenary: Setting the Scene<\/strong><\/h4>\n
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Panel 1: Energy Transition<\/strong><\/h4>\n
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Panel 2: Managing Your China Business\u00a0<\/strong><\/h4>\n
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Panel 3: Healthcare and Biosciences<\/strong><\/h4>\n
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Panel 4: Supply Chain Management\u00a0<\/strong><\/h4>\n
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Fireside Chat<\/strong><\/h4>\n
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The UK-China Business Forum 2024 was a wonderful opportunity for members of the UK-China business, education, and cultural communities to exchange knowledge and ideas and ready themselves for a productive year ahead.<\/em><\/p>\n
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