China was one of the earliest civilized nations in the world and the source of world major inventions like gunpowder, paper, printing and compass. It is the nation with the world’s longest system of writing and the most widely spoken language in the world, Chinese. It is against this rich history background that makes china one of the most stable nations in the world to do business in.
Agriculture tops the list of China Major Industries producing over 0.9 million tones of produce to the market, most of which are consumed in China. The industrial sector has a capacity to produce large advanced equipment which includes Nuclear power sets, fertilizer and petrol chemical equipment, Paper and textile machinery etc, Electro-mechanical products sector is the leading sector in exports with products worth over US $228.5 billion exported annually to other countries.
Automobile industries is another sector of the China Economy that is growing at a fast rate with over 5.4 million automobiles produced annually. Cars have become the product with the highest growing retail rate.
China is the world’s major exporter of cosmetic, medical and pharmaceutical products including precision laser products, dental products etc. our cosmetic med spa business will be able to acquire the entire range of product needed at a low cost as compared to buying them in United States or United Kingdom. Besides many people are traveling from North America and Europe in search of cheap medical attention. We will be able to take advantage of the current situation to reap maximum benefits.
Legal and Political System
The Chinese Government is subordinated by the Chinese communist party (CCP) whose role is to implement party policies. National people congress (NPC), the presidency, and the state council are the three main primary organs of state power. The prime minister, the four vice premiers, state councilors and ministers makes up the state council. The NPC is the top most organ of state power in China, responsible for approving or changing major policies, National Budget and Laws.
Misuse of Government fund has been rampant in the past by top government officials; this high level of corruption has tainted the image of china to the international communities. The Chinese government have punished over 68,000 government official for their involvement in corruption since 2003. The government will have to do more than punish the corrupt official to end corruption in China and restore investor’s confidence.
Establishment of Foreign investment in China is subject to examination, approval and registration by the Chinese Government. For our Business investment, we will be required to submit our business proposal to the China Technological Renovation Administration (CTRA) for approval before we can proceed with various task centered on the feasibility study on Cosmetic Med Spa business. Before signing of legal documents like articles of corporation and contracts, we are required to submit the feasibility study report to the Shanghai planning department for approval. The ratification department will issue the Approval Certificate for Business Enterprises with foreign Investment after the ministry of Foreign Trade and Economic approves the Contract and article of corporation. The last step will be for us to register with administration of Industry and commerce to start the Cosmetic Med Spa business.
China has progressively set up a complete legal system to encourage foreign firm to invest in China. The National People’s Congress in 1979 came up with a law on Chinese foreign Equity Joint venture, since then, the law has been amended to favor foreign to investment in the country. Other laws on foreign investment include, Tax Law, Liquidation Law etc, all this laws are aimed at safe guiding overseas investment as China recognize the role played by foreign investment in the growth of China. Our business being a foreign Investment is going to benefit directly from foreign investment friendly policies.
After china joined the WTO, it undertook measure to eliminate major unnecessary trade barriers and tariffs and opened up sectors that were not accessible to foreign investment, this included provision of higher education and Bio-tech Industries. Half of china’s exports are produced by foreign invested enterprises. China Foreign exchange reserves stand at 1.2 Billion dollars, making it the largest foreign reserve in the world. Currently China faces pressure from the European Union and United States to increase export tariffs especially on Textile products to minimize flooding of cheap textile products to international market.
China has witnessed an accelerated development coupled with economic transformation since 1979. Income levels have increased considerably and there have been drastic reduction in poverty level. China average economic growth for the past twenty years stands at 9.5 %
The Chinese money is known as Renminbi which means “The people currency” abbreviated RMB; Yuan is the popular unit of RMB. The current exchange rate to dollar stands is 7.5 Yuan to 1 US Dollar.
China Central Bank is concerned with the latest inflation rate of 3.8%; there are plans to increase lending rate to curb inflation. This may have direct effect on prices of most products but the effects are not likely to affect the cost of doing business in China as compared to other countries.
Regional integration has helped China to rise economically. A union of enterprises from Singapore, Taiwan, Thailand and Malaysia is one of the economic driving forces having invested billion of dollars in Transportation and tourism industries in China.
The population of china stands at over 1.3 billion people with an estimated growth rate of 0.6%. This growth rate is of great concern to the government who has been trying to implement birth limitation policy but in vain. There are many ethic groups in existence in china today. The Han makes the largest ethnic group. Tibetans, Kiang, Yi, Lisu, Dai, Miao and Bouyei are the minority ethnic groups. All these ethnic groups have influenced the Chinese culture resulting to authentic fashion like the Qipao and Hanfu fashions.
The High Population has helped China in its development as it is a source of cheap labor to all sectors of Industries, Our business will surely benefit from the Locals people as we will need support staff in our Cosmetic Med Spa business. Due to the high number of foreign investment, the number of foreigner living in China major cities is very high; we are targeting this group as our main client base.
Chinese is a family language that has many sub divisions in it. Mandarin is the most widely spoken form of Chinese spoken by over 850 million people in the world. English is the widely used and accepted language for doing business in China, as such; we won’t have problem communicating with suppliers and customers.
Buddhism is the most widely practiced religion in china with over 100 million adherents, other religion practiced include Traditional Taoism, Islam with over 20 million adherents, Protestants with 15 million adherents, Catholics etc. Religion outside recognized organization is restricted by the Chinese government.
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Charles W.L Hill (1999) International Business, Irwin/McGraw publishers, United States. Web.
Foreign Investment in China. 2008. Web.
Investment in China. 2008. Web.
Laser and cosmetic Med Spa in China. 2008. Web.