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“Chinese market needs study”

Nelson Moura

The conditions have been created for Portugal and China to strengthen their trade relationship, says Vítor Costa, head of the North delegation of the Portugal-China Chamber of Commerce and Industry (CCILC). There is a lack of study, contacts, investment in relationships and time for the results to be visible, he says in an interview with PLATAFORMA

How would you describe the business fabric of the North of Portugal? And what characteristics can be attractive to Chinese entrepreneurs and investors?

Vítor Costa – The north of Portugal is distinguished by its high population density, its workforce with technical qualifications, as well as its infrastructure, both in terms of industry and transport. It is known worldwide for its textile, clothing and footwear industrial ‘clusters’, but also for automotive components, metalworking, furniture, viticulture, cork, sea processing, among others, without forgetting the research and development centers and universities, umbilically linked to the development of these industries.

In terms of attractive features for Chinese entrepreneurs and investors, first of all the know-how and quality of our industry, as well as access to many international markets (Africa and Latin America) where Portuguese companies are present. The primary objective will be to promote synergies that allow the mutual development of the parties involved.

What examples would you highlight of business or investment between entrepreneurs in the north of the country and China?

– I can give the example of three CCILC associates, two Portuguese with investments in China and one in the opposite direction. Elastron, one of the largest suppliers of coatings for the upholstery industry. In 2018, the Portuguese company targets the Asian market and creates Elastron China. It already has around two dozen employees in the country, a delegation in Shanghai and a warehouse in an industrial area. TMG Automotive, a Portuguese company dedicated to the research, development and production of technical fabrics for car interiors. It supplies major car manufacturers such as BMW, Daimler, Toyota and Volvo. In 2020, it invested in the capital of HaartzMinth (Ningbo) Automotive Ltd.Chinese Industrial, an industrial company incorporated under Chinese law, whose corporate name was, however, changed to HaMinGi (Ningbo) Automotive Ltd. An operation in consortium with American and Chinese partners.

China Communications Construction Company (CCCC), considered the fourth largest construction company in the world, acquired in 2020 around 30 percent of the capital of Mota-Engil, which allowed the Portuguese company greater capacity in international tenders, access to financing and the possibility to obtain technologies and raw materials at the best price.

What obstacles hinder business relations between the two sides? What activities does CCILC plan to organize for this year?

– There are no obstacles in sight, quite the contrary. There is enormous potential for growth in business relationships. However, like any other international market, the Chinese market requires study, contacts, investment in establishing relationships of trust and time to obtain results.

The CCILC has an unprecedented frequency of events, and since the beginning of the year it has already organized, co-organized or been involved in about 30 initiatives. It should be noted the large flow of Chinese institutional and business delegations that are requesting the organization of events with Portuguese businessmen, whose information is often published via the Chamber’s communication platforms (website, newsletter and social networks).

For example, between the 18th and 20th of May, we accompanied a delegation of Chinese companies with a presence/investment in Portugal to the Algarve (we had already done it to the North), passing through Monchique, Albufeira and Lagos.

On the 18th of May, together with the EU SME Center, we organized the Workshop “Practical Guidance to Green Tech Opportunities in China: Exploring Realities and Debunking Myths”, at the headquarters of Haitong Bank, in Lisbon, which also supported the event.

On the 24th of May, we received a business delegation at the session “Shandong-Portugal Economic and Trade Matchmaking Meeting”, at Hotel Dom Pedro, also in Lisbon. There were more than two dozen Chinese companies, in addition to government representatives from different cities in the province of Shandong, promoting exchange and cooperation between Chinese and Portuguese companies in various sectors such as transport, machinery, textiles, artificial intelligence, energy, smart cities, among others. others.

And on May 26th (today) we left for China on a mission promoted by the Chinese Embassy in Portugal with 30 Portuguese businessmen from the textile sector, with visits to the cities of Wuhan, Beijing and Hangzhou.

Portugal appointed a new ambassador to Beijing and a new Consul to Macau and Hong Kong, and a new delegate from the Portuguese Agency for Investment and Foreign Trade (AICEP) to the Macao SAR. Do you hope that these changes can bring new life to business relations on both sides? What role can Macau play in relations

– CCILC has the best relations with Portuguese institutions in China, namely the Embassy, Consulates and representations of AICEP. There is a clear notion that it is necessary for everyone to work together, in the same direction, so support is mutual and constant. We must say that the previous Ambassadors and Consuls were unsurpassed in their openness and availability, just as the current ones have already demonstrated that they intend to maintain the same relationship and dynamism.

As for Macau, it will always be an excellent way to enter China, in fact, now more than ever, taking into account the structures that are being prepared to facilitate the connection to Guangzhou, such as the Greater Bay Area project and the of In-depth Cooperation between Guangdong and Macao in Hengqin, not forgetting the important role that Forum Macao could play.

What impact did the visit of the Chief Executive to Macau to Portugal in April have on this relationship?

A very positive impact, especially the unequivocal demonstration of interest on the part of those responsible for the territory in which Portugal maintains a decisive role in linking China/Macao to the Portuguese-speaking world.

Portuguese companies often point to the lack of initial capital as one of the obstacles to entering the Chinese market, how can this obstacle be overcome?

– Through the identification of Chinese business partners who can take over the promotion/management of the business in the Chinese market. One of the most requested services at CCILC is precisely the research and creation of contact lists (suppliers/importers) according to specific characteristics. Attendance at events with Chinese delegations can also be an excellent way to make contacts, as well as the traditional participation in missions with scheduling meetings and visits to fairs. In any case, each case must be analyzed in the light of the specific context and objectives of each company.

This post is also available in: Português 繁體中文

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