Editor's Note: Despite global uncertainties and the economic downturn caused by the COVID-19 outbreak, China is on track to embrace the dual-circulation development pattern as it enters the 14th Five-Year Plan period (2021-25) in 2021, which also marks the 100th anniversary of the founding of the Communist Party of China. China Daily spoke to senior executives from multinational corporations to get their views on the overall macroeconomic environment, potential business opportunities, and how China can play a key role in shaping the trajectory of global growth.
Q1: How important have your China operations been in your overall performance in 2020?
Q2: China's new dual-circulation development pattern emphasizes on boosting domestic demand and further opening up the domestic market. How will your company utilize this policy to expand your presence and investment in China?
Q3: Which policy aspect in the government's "Six Safeguards and Six Priorities" directive has emerged as most conducive to your development in China amid the global economic uncertainties?
Q4: What are your views on China's highly centralized but people-oriented economic development model? Do you think China's policies to quickly and effectively restore business activities and safeguard people's livelihood have helped your business recovery in China and contributed to the recovery of the global economy and industrial chains?
Q5: What's your take on Beijing's stance that China has entered a "new development stage"? How would such a proposition bring changes to your China strategy?
Q6: What aspects of China's 14th Five-Year Plan and the country's 2035 long-term development goal are you most looking forward to, and how will your company adapt its strategy according to the country's future growth paradigm?
Cecilia Qi, vice-president and general manager for Pharma & Vaccines at GSK China. (PHOTO PROVIDED TO CHINA DAILY)
A1 We are dedicated to the China market which has huge unmet demand for available, accessible and affordable high-quality medical solutions. In such a special year as 2020, GSK continued to be actively engaged in the battle against COVID-19, providing patented technologies, establishing extensive strategic partnerships around the world and supporting the development, manufacturing and launch of COVID-19 vaccines.
A2 China's dual-circulation strategy allows the sharing of market opportunities and innovative results, bringing opportunities for mutual benefits. GSK is stepping up efforts in China to introduce innovative healthcare solutions and improve accessibility.
Over the past 10 years, GSK has launched nearly 20 biopharmaceutical products in China. In 2020, three of our innovative products were successfully added to the National Reimbursement Drug List to benefit Chinese patients. We will continue to leverage our advantages and expertise to bring more of our innovative medicines and vaccines to the country, addressing huge unmet medical needs.
A3 Our mission to bring innovative healthcare and medical solutions to China will especially benefit from the country's increasing stability in foreign investment, trade and supply chains. This will help us further add to the suite of products that we have launched here, as we increase the pace of introducing innovative vaccines, prescription drugs and new healthcare products into the China market.
A4 China's swift and effective measures against the COVID-19 pandemic convinced the world with its technical capabilities and social resilience. As the second-largest economy globally, its speedy recovery in almost all aspects of life reassured our business operations and long-term development strategies in China, especially for the pharma industry when COVID-19 calls for improving attention and investment in healthcare.
A5 In pursuing the new development pattern, China's scientific and technological innovations are key to create new growth momentum. Underpinned by scientific and technological innovation, China's "new development stage" encourages GSK's mission and strategy to strengthen our R&D efforts and investments to bring more healthcare innovations to China.
A6 The Healthy China 2030 vision will continue to be our main focus. In addition to increased attention paid to public health and strengthening the early response system, we foresee rapid development in preventive healthcare, telemedicine and the promotion of eldercare.
To that end, GSK continues to support the development, manufacturing and launch of COVID-19 vaccines and treatments.
Kyung-ae Choe, managing director for Pierre-Fabre Dermo-Cosmetique China. (PHOTO PROVIDED TO CHINA DAILY)
A1 For Pierre-Fabre, China is our largest international market. Despite the impact of COVID-19, Pierre-Fabre China recovered rapidly by implementing omnichannel strategies and balancing our business between offline and online. The efficiency and agility of our team contributed to our success during 2020 with strong online growth. We are very proud of our team and are confident in our development in China going forward.
A2 China's development in 2020 spoke for itself. Its economy achieved 2.3 percent year-on-year growth amid the pandemic, which in our view, resulted from the reasonable implementation of national policies and the unremitting efforts from its people.
Under the guideline of dual-circulation, the cooperation will elevate our promise to Chinese consumers to the next level and help us to better satisfy consumer needs.
A3 The directive effectively protects MNCs' investments and ensures stable development. It offers a high-quality platform for MNCs' further investment and expansion in China. A stable environment is one of the most important aspects for enterprise development. Currently, in terms of enterprise operation and investment, China offers the safest environment in the world. This provides MNCs with great confidence to infuse more energy into its development in China.
A4 When COVID-19 swept across the world, the Chinese government effectively curbed the outbreak. This not only contributed to the quick recovery of the Chinese economy, but also enabled the healthy and stable development of foreign enterprises in China.
Thanks to China's policy of recovery and restoration, our business returned to normal quickly in the second quarter. We shared our experience with our colleagues all over the world to help them better balance business priorities and employee safety.
A5 China's development is a miracle for global economic development. China is leading the world's economy with strong growth, cutting-edge technology and innovations. E-commerce and digitization are transforming the market and the world we live in. Chinese consumers are becoming more and more demanding and sophisticated. Pierre-Fabre is fully committed to embracing the challenges by listening to our consumers, transforming our business and following fast-changing market trends.
A6 The new plan emphasizes high-level opening-up, green development and improvements in people's lives, each of which echoes our group purpose. Based on our core strategy, we will make localized adjustments. We will stick to a consumer-oriented strategy and continue to create employment and focus on domestic issues including education and women's rights, in order to fulfill our corporate social responsibility in China.
Shirley Yu, senior vice-president and group general manager for Visa Greater China. (PHOTO PROVIDED TO CHINA DAILY)
A1 Statistics show China has recovered quickly from COVID-19, and its economy continues to bounce back. Visa has been operating in the China market for over 30 years and our commitment to the market remains long term. We are dedicated to working closely with the Chinese government, financial institutions and other industry players to bring secure and innovative payment solutions to the market. We see significant potential for Visa to support continued growth and evolution of digital payments in China, including during the Beijing 2022 Winter Olympics and Paralympics.
A2 China's small and medium-sized enterprises are crucial. According to the Ministry of Industry and Information Technology, by the end of 2018, China's SMEs contributed to 60 percent of the GDP. We are supporting SMEs to recover from the pandemic through digital transformation and providing them with new business skills and tools including B2B payment solutions. We also launched campaigns to incentivize spending and promote digital commerce by connecting sellers and buyers, linking China with the rest of the world.
A3 For more than 30 years, Visa has been proud to serve millions of Chinese consumers in partnership with 57 leading financial institutions in China. We are inspired by the government's recent policies to continue accelerating foreign trade and attracting foreign investment. As a long-standing partner of China, we are encouraged by the country's commitment to further opening up the financial services sector. We look forward to working more closely with our domestic partners.
A4 Statistics show China has recovered in good time from the pandemic and its economy continues to roar back to life. The Chinese government has announced a series of policies for businesses and individuals to boost domestic spending. These policies will be conducive to Visa's development as we connect sellers and buyers around the world and we see consumers making more cross-border purchases through the use of e-commerce.
A5 China is transforming itself as it enters its new development stage. We look forward to bringing our innovative products and solutions to China and adding value to the market. Visa will transform and grow together with China in the new development stage and beyond.
A6 Visa sees even greater potential in responding to the government's initiative, which aims to accelerate high-quality economic growth for the benefit of Chinese people. At the same time, Visa remains committed to supporting China's sustainable social development, including rural revitalization and financial inclusion, as well as people-to-people and cultural exchanges.
Charles Kao, president of Amorepacific China. (PHOTO PROVIDED TO CHINA DAILY)
A1 China has always been the most important overseas market for Amorepacific. It is also a strategic spot for the global development of the group. In 2020 we responded to the call of the Chinese government for economic recovery. At the same time, we actively adjusted our brands' digital marketing strategy and resource allocation, fully integrated data operations and diverted offline consumer demand to online. Our sales increased 100 percent year-on-year on Tmall's Singles Day.
A2 I think it's time for us to embrace a new mindset of "if it works in China, it will work in the world".
Products and marketing approaches tailored for Chinese customers will more likely become best practices that prevail and succeed in overseas markets. Shanghai is our regional headquarters. We have a full-fledged large team that conducts research and development, production and marketing. From innovated in China to social marketed in China, our China team is always able to define an effective way to get closer to Chinese customers and make ourselves better integrated into the changing environment of the local market.
A3 In view of the prominent problems foreign-funded enterprises currently face, the government has specifically proposed a series of targeted measures such as optimizing the foreign investment environment, innovating methods of attracting foreign business and investment, and promoting the construction of open platforms. It has constantly relaxed market access, provided foreign-funded enterprises with targeted, operational solutions and created a market-oriented, legalized and international business environment.
These favorable policies make us more hopeful about the future of investing in China. And they strengthen our determination to take root in Shanghai for future development.
A6 For us, the Chinese market is a special trendsetter. Due to its unique expression of trends, diverse consumer groups and ways of thinking, booming innovation strength and unique digital ecosystem, our business development and practice in China is forward-looking and referenced for global business.
Strengthening the competitiveness of "brand" and "digitization" is our breakthrough point for 2021.
We will continue to support the development of high-end brands, especially Sulwhasoo and Laneige, in the Chinese market. In 2020, all of our brands embraced the fast track of digitization, and it has contributed half of our overall business growth under the new platform development, digital stores and community operations. China's market is highly digitized and the digital ecosystem is perfect. In the future, digitization will still be the core track for the development of the beauty market. And it is also the key for us to keep ahead.
Holly Lei, president of Covestro China. (PHOTO PROVIDED TO CHINA DAILY)
A1 Despite the still lingering COVID-19 pandemic, we have seen a strong comeback, particularly thanks to the resilience of our business in China－our largest market. That has enabled us to revise up our earnings guidance from earlier 2020.
As we continue our journey toward a future of circularity, China will certainly play an increasingly important role as both a huge market and a source of continuous innovation. Business opportunities in China will emerge from innovation, which is always the lifeblood of Covestro.
A2 We believe that the new development paradigm with domestic circulation as the mainstay and domestic and international circulation reinforcing each other will mean that Covestro can leverage its global expertise and networks, together with its local partnerships and innovation projects in China, to better serve our clients and contribute to the shift toward high-quality economic growth in the country.
A3 A stable industry value chain and a well-functioning market system, which the Chinese government has pledged to maintain, are extremely important for multinational companies like Covestro. Also, the Chinese government's commitment to supporting foreign investors is helping boost confidence in the entire industry to navigate through challenging periods.
A4 The centralization system in China has worked well to help control the spread of the virus, and its strategy to contain the pandemic before restarting the economy proved to be quite a success. That's why China was the first country to recover, and the China market for multinational companies was also the first to recover.
As the country unveiled massive stimulus packages, our customers were back on a recovery track, which in turn helped our business.
A5 As China enters the new development stage, it will put greater emphasis on growth quality over speed. And the country will step up efforts to improve environmental protection to realize sustainable growth.
Covestro's business strategy and initiatives fit in well with China's agendas in the new development stage. The company will completely align its entire production and product range as well as all areas over the long term to the circular concept.
A6 China is doing its best to optimize the nation's investment and business environment. The country has implemented a new foreign investment law, and has significantly shortened the negative list for foreign investment.
China is also stepping up efforts to promote globalization and regional economic integration in a more proactive way. This will create more collaboration opportunities for companies worldwide, including Covestro.
Fabrice Megarbane, president of L'Oréal North Asia Zone and CEO of L'Oréal China. (PHOTO PROVIDED TO CHINA DAILY)
A1 Our remarkable performance in China was a decisive factor in L'Oreal's overall performance for 2020. Amid the challenges brought by COVID-19, the sales in China recorded 20.8 percent year-on-year growth at the end of September, significantly outperforming the market. The speed of recovery varied significantly depending on distribution channels and categories, but the increase in sales in offline stores and in the selective makeup market in China was particularly encouraging.
A2 In a post-epidemic era, the dual-circulation development pattern is key to economic recovery, boosting domestic demand and upgrading the industrial chain.
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We are confident in the prospects for the domestic economic cycle driven by consumption. The better livelihoods and stable employment rates in China, and Chinese people's increasing aspirations for a better life create huge market demand.
As for "external circulation", L'Oreal has witnessed China's determination to accelerate high-quality opening-up with multiple initiatives. We are fully confident regarding China's future development.
A3 In the fight against the epidemic, L'Oreal China has been deeply impressed by the determination, speed and pragmatism of the Chinese authorities to best contain the epidemic, as well as the discipline, solidarity and heroic spirit of the Chinese people, the dedication of experts, medical professionals and even the army to fight together.
A4 In the past few years, China has made great efforts to make the Chinese market more stable, transparent and predictable, as well as fairer in terms of competition. It has also been a force for prosperity and stability－from streamlining administration and delegating power to reducing taxes and fees, and from continuous integration with the international community to localization and innovation.
A5 In this "new development stage", supply-side structural reform has long been a top policy objective. The government pledged to also pay attention to demand-side management to further strengthen the new development pattern. Chinese consumers' aspirations for a better life are stronger than ever, which leads to the booming trend of "Good Consumption".
A6 We particularly look forward to the government's ambitious plans on innovation-driven development and green development.
If the future looks particularly bright, that's because China is blazing new trails as a global leader in digital and crucial new technologies. By combining large active markets with a dynamic and startup friendly ecosystem, China is providing incentives for innovation and becoming a magnet for pioneering talent.
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