Availing of a historic opportunity
The first China International Import Expo is an ideal platform for Irish companies to introduce themselves to the Chinese market
Tara McCarthy: “Our relationship with China is something we really value, and are committed to continue to grow.”
The first China International Import Expo (CIIE) is a historic opportunity for companies from Ireland to introduce themselves to the Chinese market and explore opportunities for local cooperation, according to Enterprise Ireland chief executive Julie Sinnamon. Enterprise Ireland is hosting a stand at this event, where nine client companies will exhibit.
They will be joined by more than 10 Irish food companies, which have confirmed they will participate on Bord Bia’s ‘Enjoy it’s from Europe’ and Origin Green stands in the meat and dairy hall. “CIIE offers a significant opportunity to Irish exporters who have ambition to grow their relationship with China,” says Bord Bia chief executive Tara McCarthy.
“The objective will be for our companies to create partnerships of mutual benefit with Chinese counterparts and relationships that are sustainable for years to come. The foundation of Chinese business culture is mutual trust and strong relationships. To succeed in the Chinese market, you need to build credibility in your business and develop strong, long-term trading relationships.”
Expanding the reach of Irish companies in diversified export markets is a key strategic priority for Enterprise Ireland. “China is an incredibly important market for Enterprise Ireland-backed companies, with exports of €1.03 billion in 2017, up 9.7 per cent on 2016,”says Sinnamon.
This makes China Ireland’s number one trade partner in Asia, with more than 300 Irish-owned companies exporting to China. Enterprise Ireland plans to drive total exports to China to €1.65 billion by the end of 2020.
There are a number of key factors that make China such an attractive market for Enterprise Ireland clients, Sinnamon adds. The sheer size of the population means that selling into China mean access to a vast consumer base of more than 1.3 billion; China’s growth rate is expected to be about 6 per cent, which is double average growth rates around the world; and excellent diplomatic and strategic relationships exist between Ireland and China, with reciprocal visits by high-level delegations.
“Irish companies already have a proven track-record in supplying innovative products to Chinese buyers in key sectors from food to fintech, agri-tech to aviation,” Sinnamon says. “Large Chinese corporations such as Air China, Bank of China, China Mobile already use Irish innovation to meet the needs of their customers. Our presence at the CIIE expo will allow us to showcase nine Irish companies across sectors such as travel technology, consumer products, pharma services to Chinese buyers. Our message to CIIE buyers is that Irish innovation is productive, pioneering and already proven in China, and that sourcing from Irish companies will give Chinese companies the Irish advantage.”
It is also of growing importance for the food sector. “China is currently our fifth largest market, with exports rising by 5 per cent in 2017 to reach €700 million,”says Tara McCarthy. At present, about 45 Bord Bia client companies sell in China.
“Growing populations and increasing wealth are driving demand for high-quality Irish dairy, meat, seafood and beverages,” she continues. “Irish exports to China have increased from €250 million back in 2012 to reach €700 million in 2017. China continues to be a key destination for Irish exports and looks on track to become Ireland’s third €1 billion market in the near future. Our relationship with China is something we really value, and are committed to continue to grow,” McCarthy adds. “Our Shanghai team works tirelessly to close the gap between Irish exporters and Chinese importers while continuing to develop relationships between Ireland and China at government level.”
The dairy sector has enjoyed particular success in China in recent years. “The removal of European milk quotas in 2015 saw investment at farm and processing level to increase Irish milk output by 30 per cent. We continue to increase the volume of high-value infant milk formula destined for China, with the latest figures indicating an 8 per cent increase in volume this year alone. This sector looks set to grow even further as farmers and processors continue to invest in production,” says McCarthy.
“The success of brands like Illuma, Eleve and Similac have helped establish the Ireland proposition of natural food production in a clean environment,” she adds. “That is something that really resonates well with the Chinese consumer. With access to Irish beef now in place in China, we can leverage the experience of our dairy exporters to offer the highest-quality and best-tasting beef to Chinese consumers.”
According to Julie Sinnamon, the ambitions of the Chinese government and the private sector to improve the competitiveness of Chinese products has driven demand for foreign technology and expertise to satisfy gaps in the domestic market. “This has created immense opportunities for overseas businesses and Enterprise Ireland-backed companies are experiencing strong growth across key sectors, such as education, aviation, life sciences, fintech, and agri-tech.”
Already, more than 3,000 Chinese students are studying in Ireland while 2,400 students are studying on Irish programmes in partner institutions in China. In the aviation sector, Ireland is a global centre for aviation finance, with 50 per cent of the world’s leased commercial aircraft owned or managed from this country. “Ireland is a supplier of products and services to Chinese manufacturers and airlines in engineering components, interiors and avionics,” Sinnamon notes.
Ireland’s innovative life sciences solutions are at the forefront of addressing global healthcare challenges in medical devices, medical sub-supply, and hospital management systems. “Irish life sciences companies are competing and winning lucrative contracts in China.”
Fintech leverages Ireland’s strengths in ICT. “Irish fintech companies are supplying Chinese customers with dynamic currency conversion, payments solutions, financial services software and platforms, and business process outsourcing solutions.”
Ireland’s global reputation for farming expertise and high-quality food production systems, combined with technical expertise, places it to the fore in agri-tech innovation. “Ireland is a source of leading agri-tech solutions in dairy production, milking, feeding controls and farm-machine manufacturing for Chinese companies,” Sinnamon adds.
“This very strong trade relationship, coupled with the recent new beef trade deal between Ireland and China, and the introduction of direct flights from Dublin to Beijing and Hong Kong, all bodes well for Irish companies to expand their reach into China,” she says.