What Does China Mean to Us? A Look in 2006 into the Shared Future of China & South Australia
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This presentation made to the Rotary Club of Eastwood (South Australia) looked into the future and what importance China might have for Australia. It is interesting many years later to see how much is true, and what predictions haven't come true.
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What Does China Mean to Us? A Look in 2006 into the Shared Future of China & South Australia
- 1. What Does China’s Growth Mean to Us? 15. November 2006 Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 1
- 2. When We Were Kids China was a sleeping giant Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 2
- 3. Very Much Awake In the Meantime Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 3
- 4. A Look into the Crystal Ball Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 4 China will become wealthier • More money for SA products • Basic materials - copper, steel, coal • Vegetables, fruits and nuts • Wine • More money for Australian quality of life • Holidays • Education • Retirement in SA? • More money to invest in Australia • To qualify for visas and citizenship • To hedge their bets China will continue to expand its manufacturing dominance • Automotive, general manufacturing, and low-tech items made in Australia will be increasingly threatened
- 5. Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 5 All is not Gold Certain problems in China will worsen • Gap between the “haves” and the “have nots” • Civil liberties (religious freedom political plurality) • Corruption • Piracy • Water management • Environmental impact of China's growth • China's cost base will change as it matures
- 6. Implications: Manufacturing Distribution Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 6 Changes to Expect • Chinese manufacturers will work up the value chain • Chinese will look to invest in SA businesses • Specialised, niche companies in SA will increase sales to China Implications • Non-specialised SA manufacturers will continue to battle to survive • Local companies with SA expertise will be attractive partners for Chinese • Proactively seeking trustworthy business partners in China will pay off • Success will come from focusing on strengths: • Mass or commodity-type production in China • RD, complex or critical manufacturing or services in SA
- 7. Implications: Travel Leisure Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 7 Changes to expect • More Chinese tourists to SA • Herd mentality of Chinese tourists will slowly diminish • Expectations of Chinese tourists will change – more diversity • Exclusive tours will be seen as status symbol - Penfold’s Grange and the lot Implications • Adjustment of existing offering to match Chinese tastes interests • Need for direct flights from Adelaide to major PRC cities • Buying up of our comparatively cheap club memberships • Ability to offer services in Mandarin will be critical • Discovery of high quality of life in SA will lead to more long-stay visitors
- 8. Implications: Financial Services Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 8 Changes to Expect • More Chinese investors in SA • Baby boomer Aussie business owners selling out to Chinese investors • Chinese clients splitting time between China Australia Implications • Need for understanding of the Chinese business approach • Involvement of family and friends • Trusted partners expected to supply a wide range of support • Strategic approach • Work ethic / tenacity • Demand for increased flexibility while maintaining professional standards • Consolidation of global accounts: need to understand offshore systems • Ability to offer services in Mandarin will become critical
- 9. Implications: Health, Education Personal Care Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 9 Changes to Expect • More Chinese patients / clients • More transient population (students, holidaymakers, seasonal visitors) • Spiralling overall heath care costs Implications • How to bridge Chinese expectations with Australian way of educating and providing health and aged care? • Increased demand for Traditional Chinese Medicine (TCM) care – from Chinese and Australians • More and more medical supplies coming from China • Pressure to reduce health care costs – Chinese suppliers, offshoring • Flexibility in fees and billing to serve non-Medicare patients • Ability to offer services in Mandarin will become important
- 10. Implications: Media Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 10 Changes to Expect • Growth of specific sectors exporting to China (mining, livestock, produce) • Increasing interest of Chinese language and culture in Australia Implications • Need to understand how increased dependency on China affects local business and citizens • The role of media in interpreting international developments for the local audience
- 11. Implications: Resources Environment Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 11 Changes to Expect • Continued strong growth of the mining industry • Population increase in SA, if only transient • Increased demand for Australia's unique flora fauna • China’s environmental mismanagement will continue Implications • Increased pressure to balance tourism revenues with environmental management • Role as communicator between factions will become more important • Will Australia be affected by China's poor environmental management?
- 12. Some Concluding Thoughts • Remember that every challenge brings opportunity • Embrace the change, focus on your strengths and figure out what China means for your business, your job, your family • Seek more information and be wary of xenophobia • Visit China - see it for yourself • Consider encouraging your children and grandchildren to learn Chinese • We certainly have more to gain than to lose as China becomes more prosperous and a full member of the global economy Copyright © 2006 Best Solutions International Best Solutions International Maximising Your Market Potential 12