China

We all know that today China is not just the second largest economy in the world, but also a heavyweight in global business. After four decades of transformative economic development, opportunities abound for companies that are looking to do business with or in China.

Welcome to China

Its increasingly affluent middle class has growing demands for consumer goods, while its manufacturing sector is moving up the value chain. In addition, the Belt and Road Initiative and plans to develop the Greater Bay Area look set to sustain growth in the coming years.

HSBC was established in China over 150 years ago and the country is at the heart of HSBC’s strategy today.

With a universal banking platform, over 7,000 staff and more than 170 outlets in 57 cities across the country, HSBC is one of the largest international banks with a wide network in China.

Our heritage in the country, together with our global network, makes HSBC the perfect partner to help international businesses embrace the many opportunities China has to offer.

Please get in touch to find out how we can help you and your business navigate China’s vast economy and tap into its potential.

We look forward to seeing you here.

David Liao President and CEO, HSBC China

Head office address: HSBC Building, Shanghai IFC, 8 Century Avenue, Pudong, Shanghai, China 200120

Essentials

Population
1.4 billion1
Size
9,596,960 sq km
Main languages
Mandarin Chinese is most widely spoken, although many other forms of Chinese are also used
Capital city
Beijing
Other major cities
Guangzhou, Shanghai, Chongqing, Hangzhou, Shenzhen, Chengdu, Tianjin, Xi’an
Currency
Renminbi (RMB) is the official name, Yuan is the unit of the Renminbi
Dialling code
+86
GDP
USD8,123 per capita1
Top exports
Electrical and other machinery, including computers and telecommunications equipment, apparel, furniture, and textiles2
Top imports
Electrical and other machinery, including integrated circuits and other computer components, oil and mineral fuels, optical and medical equipment, metal ores, motor vehicles, and soybeans2
Unemployment rate
3.95%3
Corporation tax
25%4
Typical office hours
09.00 - 18.00, Mondays to Fridays and 09.00 - 17.00 for government offices
Time zone
UTC +8
Emergency numbers
110 (police), 119 (fire) and 120 (ambulance)

China: The globe’s blooming economy

  • An economic giant

    As the world’s second largest economy, China cannot be ignored. Many economists forecast that the country will surpass the US economy in size over the coming decades.

  • The biggest contributor to growth

    Ever since China introduced market reforms in 1978, the country’s annual GDP growth has averaged an extraordinary 10%. The World Bank says that China has been the biggest contributor to global growth since the global financial crisis.

  • Vast country, vast appetite

    China has a growing middle class, which is fuelling the nation’s appetite for consumer goods – from smartphones and luxury goods to white goods and cars.

  • A country with a vision

    From the Belt and Road Initiative to the latest Five-Year Plan, China’s leaders tend to focus on long-term, large-scale projects, which is good news for potential investors.

  • China’s opening up

    One step at a time, China is opening up to investment, to outside influences and to overseas tastes. The potential for foreign involvement is huge.

Country profile

China is in a league of its own. A global behemoth of an economy, with a unique business culture that operates on an unprecedented scale – it is not only the world’s largest exporter, it is also the second largest importer of merchandise.

And this has all been achieved at breakneck speed. Just 40 years have passed since China’s reform and opening-up policy was initiated in 1978. Fast forward and China’s now a major global player with the potential to drive growth in Asia and beyond in the decades ahead. It still posts enviable growth rates, despite a modest slowdown in recent years.

The Chinese economy is at a key point in its development, as the government is working to move the economy up the value chain. Future growth will be less dependent on heavy industry and manufacturing. Instead, services, domestic consumption and innovative business models will play an ever-greater role.

Made affluent by years of economic growth, a new generation of consumers is being empowered by the booming digital economy.

China’s latest Five-Year Plan and the Belt and Road Initiative will now spur the next stage of development - one that is focused on promoting more sustainable, inclusive and green growth.

There is little doubt that China will continue to enjoy strong growth in the coming years. Foreign businesses are particularly attracted to the country as a market for goods and services. There are challenges however, as international companies need to learn how to navigate its markets and local business culture.

Read on to discover more about the dos and don’ts of doing business in China. Also find out how trading in or with the country could help boost the future growth of your enterprise.

5 reasons to do business in China1

  1. An essential part of the global trade system
    Whether it is buying or selling, China is one of the most important trading nations - it is the world’s largest exporter and the second largest importer of merchandise.
  2. One of the world’s largest digital economies
    From artificial intelligence to cloud computing, China is now a leader in innovation. In 2016, for example, the Chinese spent USD5.5 trillion through mobile payment platforms – almost 50 times more than in the US.
  3. An enormous market for consumer goods
    There are 400 million young consumers in China. Not only is their spending power growing, they are increasingly interested in foreign brands.
  4. Most attractive for inbound investment
    China is one of the most attractive inbound investment destinations globally. If your strategy is aligned with China’s economic development, then the potential is incredible.
  5. An economy in transition
    The country is transitioning - from high-speed to high-quality growth, exports to consumption, heavy industry to services and high-tech - as it aims to add value and become a high-income country by 2030.

5 key challenges2

  1. 1

    Environmental issues

    Five of the most polluted cities in G20 countries are in China. However, the government understands the value of sustainable growth, and it is implementing plans to green its economy and address air pollution issues.

  2. 2

    More mature growth rates

    China is in transition, from high-speed to high-quality growth, exports to consumption and heavy industry to services. Although this brings opportunities for businesses, it is also tempering growth.

  3. 3

    Rising costs of doing business

    As China’s eastern seaboard becomes wealthier, the cost of doing business, setting up factories and employing workers is increasing. Many companies now look for cheaper labour in China’s landlocked provinces or in Southeast Asia.

  4. 4

    Corporate debt

    Corporate debt has built up over the last decade. The government is working to reduce leverage and address other risks in the financial system.

  5. 5

    Catching up with the coast

    Development in China’s inland provinces lags behind the more affluent coastal areas, making the west of the country a key focus of future development plans.