Collaboration between two nations on the cards
Business insiders tap into the challenges and opportunities enriched by bilateral cooperation
The prospects for Sino-French economic collaboration are poised to be enriched by an increase in the goods trade and augmented cooperation across various domains, including aviation, digital technology, retail, sustainable growth, advanced manufacturing and trade in services, said market watchers and business leaders.
Despite encountering challenges, such as diminishing global demand and a rise in trade protectionism, the bilateral trade relationship between China and France has maintained robust interdependence across diverse industries, said Zhao Yongsheng, a professor at the Institute of Regional and International Studies at the University of International Business and Economics in Beijing.
As China ventures into a new phase characterized by environmentally sustainable and innovation-driven growth, it is poised to continue exporting consumer goods while importing high-tech products from France, such as electronics, passenger aircraft, automotive parts and medical equipment, said Zhao.
Currently, France is China’s thirdlargest trading partner and the third-largest source of actual investment in the European Union. China is France’s top trading partner in Asia and the seventh-largest in the world, according to China’s Ministry of Foreign Affairs.
Despite challenges ranging from the COVID-19 pandemic to geoeconomic fragmentation in recent years, the total trade value between the two countries grew by 3.1 percent year-on-year to 555.11 billion yuan ($77.15 billion) in 2023. Meanwhile, China’s imports from France soared 10.9 percent on a yearly basis, data from China’s General Administration
of Customs showed.
In addition to passenger vehicles and aircraft, water treatment, chemical and pharmaceutical products, France’s exports to China feature fashion, agricultural and energy infrastructure products. China exports mainly construction machinery, manufacturing equipment, steel, electronics, textiles, garments and household appliances to the European country.
“Most of their imports are complementary. Therefore it isn’t direct competition,” said Wang Hong, president and professor of management at the China Europe International Business School.
Apart from boosting trade volume, Wang said China’s ongoing consumption and industrial upgrading boom has attracted French investment to China in many commercial areas such as high-end manufacturing and green development in recent years.
Echoing that sentiment, Yin Zheng, executive vice-president of China and East Asia operations at Schneider Electric, a French multinational company specializing in energy management, said the company will continue strengthening its “China Hub” strategy in all aspects including talent, innovation, supply chain and ecosystem in 2024.
“As China has intensified its focus on high-quality development and embraced the ‘dual carbon goals’ in recent years, there has been a notable increase in the demand from Chinese consumers for digital solutions and environmentally-friendly products,” said Yin.
With rapid industry growth and a vibrant market, China has become Schneider Electric’s second-largest market, the largest supply chain base and one of its four global research and development bases. Furthermore, it has become the essential source of innovation and a driving force for Schneider Electric’s global success.
“We will keep strengthening our advantages in technologies and strategy and keep empowering Chinese users and partners from all industries to accelerate the green transformation this year,” he said.
Yin added that by applying the latest technologies, Schneider Electric will help Chinese users improve their competitive advantages.
After 37 years of development, Schneider Electric operates 29 factories and distribution centers across China with more than 1,600 Chinese suppliers. The company runs five research and development centers located in Beijing; Shanghai; Xi’an, Shaanxi province; Shenzhen, Guangdong province; and Wuxi, Jiangsu province, forming a hardware and software integrated innovation system to better serve Chinese customers’ upgrading demands.
Servando Quevedo, vice-president for China at French sporting goods retailer Decathlon, said that after building deep roots in China for more than two decades, Decathlon is committed to promoting the high-quality development of China’s sports industry. It is building a platform for cultural exchanges between France and China through long-term diversified activities in a variety of sports initiatives.
“China is one of Decathlon’s most important markets,” said Quevedo, stressing that the country’s sports industry is a 1 trillion-dollar ‘blue ocean’ market — a new market with little competition or barriers — that has entered a period of rapid development, particularly as the sports sector increasingly integrates with tourism, health and lifestyle industries, opening up opportunities for growth.
China’s sports industry has shifted from the traditional model of sports manufacturing to a multi structural one, including production, service and consumption, said Zhou Xing, North China markets leader at PwC China.
According to China’s 14th FiveYear Plan (2021-25), the total production value of China’s sports industry is expected to reach 5 trillion yuan by 2025 with sports consumption exceeding 2.8 trillion yuan.
In 2023, Decathlon’s business performance in China exceeded expectations, with outdoor hiking, cycling and skiing performing particularly well, according to the French company.
In addition to leveraging innovation to address market challenges and evolving consumer demands, the executive said that Decathlon will introduce more global highquality products and debut projects in China. These initiatives will be tailored to meet the sporting needs of Chinese consumers, injecting new vitality into China’s sports market and helping the country realize the vision of a healthy society.
Both China and France attach great importance to the development of sports and both countries have a keen interest in strengthening bilateral sports cooperation. The friendly relationship between the two countries has strengthened Decathlon’s confidence and determination to develop its long-term business in China, Quevedo added.
Wang Xiaosong, a professor of economics at the Beijing-based Renmin University of China, said China will hold a greater appeal for French companies, especially those in the manufacturing and trade in services sectors. This is due to the country’s commitment to expanding its high-level openness by removing all restrictions on foreign investment in the manufacturing sector and continuously optimizing its business environment.
French shipping group CMA CGM, eager to secure a greater market share in China, launched a new service between China and India in late 2023. Operated by five vessels, the service will cover the ports of Shanghai, Ningbo-Zhoushan, Singapore, Colombo, Mundra and Nhava Sheva. CMA CGM, which is based in Marseille, France, said the new service connects to its network operating from Southeast Asia via Singapore to ports in India, allowing customers in these regions and around the world to enjoy faster and more convenient services.