China economy seen to remain strong

MALAYSIAN companies still see bright prospects for their businesses in China post the Beijing Olympics as many do not expect the country's economic growth to slow down. 

Telecommunications value-added services provider Mtouche Technology Bhd expects China's economy to continue to grow at a robust rate after the Beijing Olympics as the country is still in the growth phase. 

Workers install lights on a Beijing Olympics sign – AP

Chief executive officer Eugene Goh said the event would have an effect on various industries.  

“The feel-good factor will also contribute to a rise in consumerism. The Olympics will be a common topic for people to relate to. Content generated from the event will increase the data and voice usage of mobile network operators. 

“It will help to increase take-up of new subscribers for the telecommunications industry, and this will pretty much sustain industry growth post-Olympics,” he said. 

Goh said China was an attractive and important market for mTouche. 

“Our unique proprietary platform, together with our national value-added services common short code license with the operators in all of China’s provinces, remains our strongest sustainable competitive advantage in the industry,” he added. 

KPK Quantity Surveyors Sdn Bhd chairman John Ling foresees some slowdown in the construction industry in Beijing after the Olympic Games. 

Eugene Goh

KPK is the quantity surveyor for the National Convention Centre for the Beijing Olympics.  

“The people of Beijing will definitely enjoy better infrastructure in the city after the Olympics. But would all these new buildings and a lot more supporting facilities be white elephants after that? Without proper planning, the chances of that happening would be high,” Ling said. 

However, Ling believes the Chinese government has a plan, and most of the supporting buildings will be converted to other uses immediately after the Olympic Games. 

He noted that the site for the Beijing Asian Games was now a major growing urban centre in Beijing. “There may be a slowdown in Beijing after the Olympics, but it also gives other cities in China a chance at development.  

“As for the construction industry, it may be slower in Beijing but there are many second-tier cities to look at and this can last quite a long time,” he said. 

KPK first set up office in China in 1995 (in Shanghai). It opened its Beijing office in 2004 when the Chinese government was in the process of appointing consultants for the Beijing Olympic Games projects. It also has another office in Shenzhen. 

Priceworth Wood Products Bhd has invested about RM50mil in logging equipment, plant and machinery to boost production capacity to cater to increased demand from the Beijing Olympics, said executive director Michael Chok. 

“Although the high demand will disappear after 2008, there will still be normal demand.  

“Huge investments will be required to rejuvenate the old industrial base in northeast China as well as the country's underdeveloped west,” he said. 

Therefore, Chok foresees no lack of hotspots for post-Olympic investments in China.  

“China has maintained rapid and consistent economic growth over the last few years. The huge investments by the government in infrastructure construction will push forward the economic growth of the country. 

“In view of the expected steady demand and our good marketing network, our business in the China market will remain positive,” he said. 

The group exports sawn timber and other processed wood products to China. Its China business accounts for 30% to 35% of group turnover. 

Nevertheless, Chok said, Priceworth was also exploring and exporting to other east Asean countries, India, the Middle East and the United States. 

Hai-O Enterprise Bhd, which imports Chinese health supplements and traditional medicine, expects sales to be better for the company as the Olympics approaches. 

“Some of the brands that we carry are official corporate sponsors and suppliers for the Beijing Olympics.  

“Although we are not directly involved, I believe sales would increase somewhat due to brand awareness from the international media coverage of the Olympics,” group managing director Tan Kai Hee said. 

He sees very little impact on Hai-O's business in the event of any slowdown in China's economy post-Olympics. “It will be business as usual for us.”  

Tan, however, believes that if an economic slowdown happens, it will be short-lived as other international events such as the Formula One Chinese Grand Prix, the A1 Grand Prix, the MotoGP and the Shanghai International Expo will continue to bring in tourists and revenue to China. 

Tan sees good prospects for Hai-O in China. “We will be importing more Chinese products into Malaysia and exporting local products to China. We will be also be setting up offices in Shenzhen, Guangdong and Kunming,” he said.

For Another perspective from the China Daily, a partner of Asia News Network, click here

Latest business news from AP-Wire 

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