Learnings from Canton Fair

CANTON Fair is celebrating its 70th anniversary, as it was first held in the spring of 1957. It is in its 140th edition because it is held twice a year, known as the Autumn and Spring sessions.

I brought some of my team members to join this year’s Autumn edition. The idea was not only to seek out business opportunities but also to learn about the advancements China has made over the years through the country’s most important trade fair.

I felt visiting the Canton Fair would be a good opportunity to see the real economy for myself, instead of just focusing on the themes of the day, such as artificial intelligence (AI), technology and electric vehicles (EVs).

The fair is deeply rooted due to its remarkable uninterrupted run of over 70 years despite turbulent periods such as the Cultural Revolution, the Covid-19 pandemic (a digital version was conducted), wars, economic meltdowns and others.

From its first debut at China Export Commodities Exhibition Hall in Guangzhou, where China wanted to promote to the world that it had what it takes to become a manufacturer and exporter to other countries, the goal today is to show its capability to be a key player in global trade regardless of sanctions, trade tariffs or economic uncertainty.

The impressive statistics speak for themselves. Canton Fair has grown by leaps and bounds from 1,200 enterprises to over 26,000 enterprises participating today.

In the past, it was largely tea, silk and agricultural produce. Today, it is AI, green technology, robotics, EVs and many others.

Whole-of-government support

While China’s economy has slowed down in the past decade (some would argue it has been a soft-landing recession masked by government interventions and policy support), its businesses and enterprises remain extremely innovative and competitive.

For a trade fair to attract global business visitors, there must be a value proposition. Whether it is innovation, price affordability or simply variety, the recent Canton Fair was truly an eye-opener in terms of its scale and offerings.

In addition to that, what I witnessed was a whole-of-government support and whole-of-city effort to promote the trade fair. From the airport onwards, there were special dedicated lanes and immigration counters for ­participants like us.

Thereafter, an abundance of special discounts and free gifts from retailers and food and beverage outlets were available across the city to fair participants. A dedicated “super app” with features such as information, meeting rooms and translator bookings has everything in one place.

Even the infrastructure development, coupled with town planning, had the Canton Fair in mind. For instance, the provincial government built the modern Pazhou complex, complete with public transport accessibility, where a massive exhibition venue accommodates 1.55 million sq m of exhibitor space compared with only 13,000 sq m back in 1957.

An interesting anecdote is also the role that the late Premier Zhou Enlai played, as he ­personally ensured the Canton Fair would continue running twice a year amid the Cultural Revolution, keeping China’s crucial global economic contact point alive during this tumultuous period in history.

This explains how much emphasis the government had placed on trade and commerce, which laid the foundation for today. This is what governments around the world should learn – to facilitate and support but not get in the way of businesses via red tape or bureaucracy.

Observation on youth employment

Despite all the positives, I did notice that China’s economy is not like what it was a few years ago.

Food prices, for one, have come down and, relative to the serving portions, food is so much more affordable than in Malaysia. Luxury shopping has also been impacted, as we saw little foot traffic in high-end shops and foreign brands.

That said, the local Pop Mart and Top Toy stores were crowded with youths and tourists willing to spend on blind boxes containing toy figurines.

Many youths are facing increasing unemployment, graduating from a good university with a degree no longer guaranteeing a solid private-sector job.

The gig economy is keeping things moving, with youths ferrying passengers with Didi (like our Grab), taking odd jobs as salespeople or volunteering at trade fairs, working as promoters in retail stores or even distributing flyers and engaging in stealth marketing by collecting customer data through scanning the WeChat accounts of passers-by outside the trade fair.

Another big difference I noticed was the attitude of the youths. Their willingness to speak in English and their service levels have improved tremendously. They approach people with a constant smile while explaining patiently.

Sure, some of the older folks are still the same, with their impatience and lack of customer service. Spitting, yelling and smoking incessantly though have become less common compared with before.

I believe the economic realities have humbled them. Some are considering migrating to other South-East Asian countries to settle down for studies, work or healthcare.

One thing is for sure: 10 out of 10 people I spoke to complained about “Nei Juan” (involution), as making a living is tough.

Yet, the irony is that many of them, in my view, would be easily employable in Malaysia if given the chance.

Malaysian youths too contented

The comparison is stark between youths in China and those in our country. In plain language, our youths are far too contented.

Very often, in my interactions with them, I have realised that today’s youth emphasise neither the betterment of life nor career advancement.

Many are obsessed with work-life balance or working from home, yet expect guaranteed bonuses and increments from their employers every year.

The lack of proactiveness or going the extra mile is also a serious concern. One should not be put in a position of only wanting to strive due to circumstances of poverty rather than a self-willingness to improve, right?

Given a choice, I would make the most of whatever opportunities are available to me, rather than waiting to be given the opportunity to excel.

Striving should be the fundamental way of life when you are young, whatever you do, regardless of profession. Being laid-back is not the way of life, at least not at this age.

The danger of social media content emphasising YOLO (you only live once) is that it risks promoting the wrong narrative, whereby one should live in the present while ignoring traditional values such as earning one’s keep.

This may be a sweeping generalisation (there are exceptions to the norm), but unfortunately, the majority of youths today focus on enjoyment of life and consumerism over frugality and hard work.

Productivity and competitiveness are key

If we are not careful, the decline of the economy and, to a greater extent, the country would falter under a lackadaisical workforce, which diminishes productivity and competitiveness.

This is where I differ with populist politicians who have not worked a day in their lives, either as employees or as business owners.

It is easy to propagate wage growth, blame business owners for profiteering (which is untrue) or blame foreign eCommerce players for flooding the local market.

However, have we paused for a moment to look inwards and reflect? Wage growth depends on enlarging the economic pie, and that comes from productivity, growth and innovation.

The government’s tendency to mollycoddle people in response to complaints is a slippery slope.

People today expect cash handouts from the administration. This was unheard of decades ago.

When local micro, small, and medium enterprises cannot compete due to the inflow of Pinduoduo’s products, associations jump on the bandwagon to seek government intervention for protectionism instead of addressing gaps in their business models.

The danger is the failure to realise this underlying current: if you do not work hard to protect your rice bowl, people will come for it, whether within the borders of our country or beyond.

Protectionism cannot prevent disruption perpetually. Continuous innovation is the only way to stay ahead or at least keep up with the curve.

That’s a fact of life.