The 7th China International Import Expo (CIIE) and the 7th Hongqiao International Economic Forum (HQF) are both coming up in November.
And I really like these types of big China events.
First, these are pretty massive. Think +400,000 attendees.
Second, they are great for catching up on what’s happening on the ground in China:
- The CIIE is a “who’s who” of foreign businesses investing and building in China. The exhibitions are effectively a crash course in what is happening on the ground. Especially in terms of new products, tech, services by foreign businesses. I always take tons of notes.
- The Hongqiao Forum is a conference with good discussions and lots of real China expertise. Note: I’ve been covering China for almost 20 years and it’s important to know who to listen to (and who not to listen to). The speakers and panel members at HQF are really good. Last year, there was the former Prime Minister of France, the Group Chief Executive of HSBC, and the China President of Danone.
Finally, I find these big China exhibitions are just really fun. They are massive and pretty fantastic.
I always bring a list of what I am trying to learn at conferences. Here are my 3 goals for these events.
Goal 1: To Get Smarter about the Rapidly Evolving Situation in China Auto
My research is in China technology. And things have been pretty crazy in this area. There is, unfortunately, a huge disconnect in the tech world between what is talked about internationally and what has been happening on the ground in China.
That’s frustrating. But also, a good opportunity for those of us that write in depth on this subject.
And the epicenter of the China tech discussion this year is automobiles.
China is the world’s largest car market. And it’s not even close. China accounts for approximately 30% of global sales. In 2023, China’s vehicle sales grew 12% to over 30 million units. And (this is the part that really gets attention), China is now over 60% of global renewable energy car sales.
On first pass, that makes China a key market for most foreign automakers. It also makes it the largest source of growth on the horizon.
However, it’s really not just about market size anymore. It’s more about tech and innovation.
China’s auto market is hyper-competitive. And we are seeing auto makers (both foreign and domestic) innovating at a frantic pace. New EVs are being launched every month. New tech breakthroughs are happening in both auto and batteries.
For foreign automakers, China is the Olympics of auto innovation and competition. In new breakthroughs. In design. In production at scale. Competing in the China auto market makes you better. More and more, we are seeing foreign automakers using their China teams and operations as the benchmark for their other operations. It’s an innovation epicenter for auto.
And this is going to be a big deal this year at the exhibition and forum. The auto exhibition is the first place I am going to visit in the convention hall. The list of foreign auto exhibitors includes:
For auto, there are going to be demonstration areas for new materials, autopilot technology and, of course, energy storage for cars.
And I expect this to be a big topic of discussion at HQF.
Goal 2: Re-Assess the Tech Innovation Situation Between China and the World
I like auto but I’m not an expert. My research is in China tech businesses, especially the digital innovators. And I have taught both digital strategy and “doing business in China” at Peking University and the China Europe International Business School (CEIBS). If you search for topics like Uber vs. Didi, Mobike vs. ofo and Tencent vs. Facebook, you’ll likely find my articles going back a decade.
To say I keep a close eye on foreign tech companies active in China is an understatement. I’m constantly looking at their imported products, tech, and services. And their new initiatives.
That’s what I’m looking for at the events. New announcements. New companies entering for the first time. New services.
My big question is: What is coming next in technology imports and investment into China?
Here are some of the foreign tech exhibitors listed. These are “my people”.
The Japanese tech leaders like Mitsubishi, Omron, and Sony are going to be there. That’s important. They’re on my watchlist. Everyone writes about the US and China in tech, but Japan-China is more exciting in many ways. Note: SoftBank has an exhibition this year. That’s interesting. They have had a major role in the development of digital China going back to 2000. They were early investors in companies such as Alibaba.
The German and northern European engineering companies are going to be well represented. Siemens. ABB. Ericsson. Nokia. Airbus. That’s pretty standard. There is a long history of tech and industrial work between Germany and China. I spend a lot of time talking about China in that region.
And of course, there are some of the American tech giants. Caterpillar. John Deere. 3M. Dell Technologies. I suspect much of the conversation will be about the American chip companies present. AMD. Micron. Qualcomm.
And some tech companies are making their debut this year include:
- Japanese Mitsubishi Electric.
- US material provider Invista.
- French transportation company Alstom.
- Ireland-based auto technology supplier Aptiv.
The Hongqiao Forum should be a good indicator of where technology will could impact China’s growth in the next 3-5 years.
Goal 3: Get an Update on Long-Term Consumption Growth in China
The topic at the center of these events (in my opinion) is long-term growth in domestic consumption. This is what everyone debates when projecting China GDP growth over the next 10 years. Growth in domestic consumption is a constant topic in the international press.
Most everyone is watching for GDP growth to gradually shift from net exports and investment to consumption. Economists argue how fast this will happen.
And it’s an important question. But most businesses don’t think this way in terms of GDP growth drivers. They think in terms of household consumption over the next 5-10 years. That is usually what drives import decisions and investment. It’s what shows up in future income statements. And this is what I’m looking for an update on.
The Hongqiao Forum should be very good for this question. Lots of keynotes and discussions. And it’s the people who can talk about this at a detailed level.
That’s the key because household consumption rates can vary significantly by sector and by product type. So, you really want to take consumption growth apart sector by sector. And, if possible, product category by product category.
For example, Chinese food, tobacco, and liquor spending has been growing at 3x the rate of spending on clothing and apparel. About 6% versus 2%, according to the National Bureau of Statistics. But medicine and medical service spending have been growing even faster (at about 9%).
But then you want to take it apart by household type. Those numbers are for urban households. For rural households, the situation is different. Chinese food, tobacco, and liquor spending and clothing and apparel spending have both been higher at 7-8%. And medicine and medical service spending has been growing faster at 11%.
Anyways, my standard advice to those looking at China is you have to go as small as possible. You want to dig into specific categories and companies.
Last Point: China Exhibitions and Forums Are Pretty Awesome
Not to generalize, but China is really good at putting on these types of events. If you haven’t been to one of these, this is a good opportunity. It’s going to be pretty fantastic.
Take a look at the exhibition hall. It’s the 360,000 sqm National Exhibition and Convention Center in Hongqiao, Shanghai.
During these events, the center gets filled with exhibition booths and hundreds of thousands of people. Here are some stats and photos from the sixth CIIE in 2023.
- 3,500 exhibitors, including 289 Fortune 500 companies
- +120 countries and regions represented
- +400,000 attendees
- +400 new products, tech and services announced
These two events (CIIE, HQF) have been around since 2018. CIIE was actually the world’s first national-level import-focused expo. The exhibition has 6 major categories for products.
- Food and Agricultural Products
- Consumer Goods
- Medical Equipment & Healthcare Products
- Trade in Service
- Automobiles
- Intelligent Industry & Information Technology
These categories are a good indication of where we can expect activity by foreign businesses in China. You can see the auto and tech focus. But agriculture and consumer products are also pretty interesting. For Consumer Goods, the attendees in beauty and cosmetics include Estee lauder, L’Oréal and P&G. In areas like furniture and home appliances, attendees include Inditex and Ikea. And in fashion and accessories, think, H&M, Swarovski, Puma, and Sketchers.
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That’s my take. It’s going to be pretty interesting.
