Tapping into potential
Patel said that over the last decade, China has moved swiftly to digitise all aspects of its economy where it is useful to do so. “China’s made great strides and achievements in the digital economy,” he said.
According to a report on China’s digital trade in 2022, the country’s digitally delivered service trade value rose 3.4 percent year on year to $372.71 billion, accounting for around 9 percent of the global total.
For foreign companies, China’s vast digital economy offiers significant opportunities to develop new products and services. “China’s emphasis on research and development, coupled with the nurturing of their own technology giants, has led to breakthroughs in areas like AI and e-commerce, influencing the trajectory of the global digital economy,” Patel said.
China ranked 11th on the Global Innovation Index 2022 released by the World Intellectual Property Organisation, up 23 places from its 2012 ranking. Meanwhile, Massachusetts-based International Data Corp predicted that China’s artificial intelligence (AI) market will exceed $26 billion by 2026.
Greater confidence
Patel believes that multinational companies, especially those in digital areas, should continue to invest in China.
“We are in this new normal whereby the China market still matters as much as probably it ever did … Trying to create new export markets for our products and services is not easy. And if you look at a market of the sheer scale as China, it’s very diffcult to replicate,” Patel said.
He believes that the UK also has work to do to build confidence and trust in its investors in China, adding that his organisation is working from both sides to support trade and investment between the two countries.
Last year, UK companies such as AstraZeneca invested billions of US dollars in the Chinese market, according to Patel. “So in certain sectors, I think you’ll find there is confidence. And I think the businesses that have been here and ridden out the challenge of the pandemic, of the shifts in policy around certain sectors, are here to stay. They’re not going to be leaving … because there’s no market that [can] replace it,” he said.
Shi Yuntao, head of delivery service at ThoughtWorks Inc., a global technology consultancy working in the field of digital innovation, said this year is the 16th year of the company’s operation in China, and his 14th year with the company. When he first joined the company, there were only 200 people. Today, there are 2,500 people across China, spread across six offices and six regions. “This shows how important the Chinese market is to us,” he said.
“The quality of the labour force in the Chinese market is very high and the market is huge. It is diffcult to find [another] China in the world. Apart from the US, it is diffcult to find a single large market like China,” Shi said.
“The emergence of generative AI illustrates China’s expanding capacity for innovation while also opening up sizable potential that plays to our advantages,” said Shi. The company is making more effiorts to enhance the business coordination between its offces in Shenzhen, Guangdong Province, and Hong Kong to expand its business in the GBA.