The Chinese economy exhibits rare certainty in the company, market, and economy
"Currently, the world economy is facing high levels of uncertainty, and the Chinese market has brought certainty to multinational corporations." Wu Chun, Executive Partner of Boston Consulting China, said in an interview with Economic Daily that there are still many opportunities to be explored in the Chinese market in areas such as consumption, digital economy, green and low-carbon, which is an important driving force for multinational corporations to achieve stable development.
Wu Chun stated that the world economy is currently facing threats such as intensified geopolitical conflicts, and there are certain obstacles to recovery, full of uncertainty. According to a survey conducted by Boston Consulting on hundreds of global business leaders, 75% of respondents believe that uncertainty is the biggest challenge facing businesses. In this context, the Chinese economy has shown rare certainty.
"For multinational corporations, there are both stock and incremental opportunities in the Chinese market. Incremental opportunities are reflected in at least three aspects." Wu Chun said, "The first is consumption potential. The Chinese government has clear policy directions for expanding domestic demand, and consumption has become an important focus to boost economic development. It is expected that by 2030, China will add more than 80 million middle-income and above population, mainly from third - and fourth tier cities. Secondly, China's digital economy has been developing rapidly and will further play a greater role in the enterprise user market in the future, driving economic growth. Thirdly, China's proposal of the 'dual carbon' goal, promoting sustainable development, will bring many new formats and technologies, and give birth to new market opportunities. Can multinational corporations seize this opportunity?" These three major incremental markets are related to whether they can achieve long-term stable performance growth
Wu Chun believes that compared to other global markets, the Chinese market has many unique features, and multinational companies must fully recognize the characteristics of the Chinese market and deeply promote localization strategies to better adapt to the needs of the Chinese market.
"The Chinese market is large and complex. Coastal and inland provinces, first - and second tier cities, third - and fourth tier cities, as well as consumer groups of different age groups, have significant differences in consumption ability and preferences. It can be said that China is not a single market, but a large market composed of many markets. The competition in the Chinese market is also extremely fierce, and the innovation ability of Chinese enterprises is very outstanding. Many multinational companies have found that the competition intensity and innovation iteration speed of the Chinese market are unmatched by any other market. If a company can survive and develop well in the Chinese market, it often becomes very competitive when it goes to other markets." Wu Chun said, "The Chinese government's policy guidance is very strong, and it can always adjust the industry through the allocation of various resources." To become bigger and stronger, it requires enterprises to fully grasp China's policy direction in order to better seize market opportunities. China's talent reserves are also increasing, becoming a significant advantage. Talent advantages help enterprises from various countries better promote innovation and deepen industrial layout in the Chinese market
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When it comes to how multinational companies can better adapt to the Chinese market, Wu Chun believes that it is crucial to focus on strengthening integration with local culture, which is something many companies overlook. Enterprises need to respect local culture and values, which can not only establish a good corporate brand image, but also an important guarantee for enhancing local team cohesion. In addition, facing the rapid development of Chinese enterprises, multinational corporations should not only see the pressure brought by market competition, but also be good at exploring opportunities for cooperation with Chinese enterprises.
"With the continuous advancement of China's high-quality economic development process, more and more innovative enterprises will inevitably emerge, which will pose challenges to the original technology and products of multinational corporations. For multinational corporations, this trend should be seen as a benign market relationship, seeking more cooperation opportunities, forming a cooperative relationship between you and me, and achieving common development." Wu Chun said.