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Business / Economy

Executives survey the prospects for China's future prosperity

(China Daily) Updated: 2016-03-16 09:54

Executives survey the prospects for China's future prosperity

Faruk Arig, President, Henkel Greater China. [Photo provided to China Daily]

A1: Being active in the Chinese market for almost 30 years, Henkel is deeply rooted here, both in industrial development and in consumer business. We have witnessed the country's fast and prosperous development over this period, as well as its peaks and troughs over the last year. From our perspective, the flexibility of the GDP target shows China's shift of focus from quantity to quality in pursuit of economic growth. The world's No 2 economy is seeking to balance deep structural reforms and attempting a transition from dependence on exports and investment to consumer-led growth. It is regarded as slower, but assuredly more sustainable, in the long haul.

A2: Implementing innovation-driven development will be both a major challenge and a unique opportunity for the Chinese economy in 2016. We are encouraged to see that China is working hard in addressing the decline in industrial growth. It took initiatives to upgrade industrial development, such as launching Made in China 2025, while fostering new innovation-oriented industries such as 3-D-printing and LED/OLED lighting through government funds and policies favoring innovative small and medium enterprises.

Manufacturing upgrades and the development of next-generation technologies are areas where Henkel is ready to provide full support with our tailor-made solutions. As we also operate a consumer business through our beauty care brands, we see positive opportunities in China's Internet Plus strategy and the booming e-commerce market.

A3: The pendulum swinging to the supply side shows that China has resolved to achieve quality and sustainable growth, shifting its focus from productivity expansion to productivity enhancement. As mentioned by Premier Li Keqiang in the Government Work Report: We need to give particular emphasis to structural reform on the supply side, reducing supply in some areas while increasing it in others.

As we see it, it is not simply the cutting of excess capacity, but utilizing it through innovation and technological advancement that presents Henkel with unique opportunities. Through our customized total solutions, we help Chinese customers to achieve higher efficiency and sustainability with lower total costs and fewer manufacturing processes.

A4: By reducing the tax burden on all industries, consolidating government-managed funds and expanding exemptions from 18 administrative charges to include all enterprises and individuals, we view it as a big move by China to encourage enterprises to foster innovation and to boost public consumption. The reduced burden on companies and consolidated government funds will help local research and development initiatives to operate in line with the country's innovation-driven development policies.

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