Commemorating the 60Th Anniversary of Swiss-Chinese Diplomatic Relations
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[email protected] http://www.glm-asia.com Switzerland Commemorating the 60th Anniversary of Swiss-Chinese Diplomatic Relations Report by: Elizabeth Dusch, Pamela Sun, Michelle Titus The Impact of China’s Rise on Swiss Companies By Ronald R. Haddock and Dr. Jochen The Emerging “One World” Schilcher, Model for Swiss Companies Booz & Company, Zurich Some Swiss companies are recognizing that the true value of the Already today China is one of China market is wide-ranging, and Switzerland’s most important trading that addressing the full potential of partners. The market potential of China positions these companies well China is massive and many Swiss to pursue growth in other emerging companies are doing well in China, markets, and even in developed but to sustain and in fact expand their markets, including Switzerland itself. total exposure to China, many Swiss The formula being pursued by some companies will need to upgrade or Swiss companies is to leverage growth even redefine how they operate in the in China’s domestic market to gain China context. scale, translate local buying in China An Important, yet Imbalanced into global sourcing scale, and to Trade Relationship use the need for local adaptation to China has become increasingly innovate entirely new products that important to Switzerland in recent appeal to value-conscious customers years. In terms of trade, Germany in global markets. Swiss companies is still Switzerland’s largest trade who choose to pursue this path will partner, but over a five year period be in a position to exploit the huge (2003-2008) exports to China grew potential of the rapidly growing at 86% to reach over 12B CHF, versus Chinese middle-market segments as 46% for Germany (46B CHF total). well as leveraging these new offerings Yet many of the exports to Germany for other emerging markets world- and other Western European trade wide. partners are for products that are To succeed with either strategy, ultimately embedded into those Swiss companies have to master countries’ exports to China and other significant management and emerging markets. Hence, the overall organizational challenges driven impact of China on Swiss exports is by and based on a mind-set shift. even more significant and within the Companies will need to move from SCCC- Swiss Chinese Chamber of Commerce foreseeable future, at current growth engineering-centric business models rates, China could very well become that focus primarily at producing Swiss-Chinese Chamber of Commerce- the top destination for Swiss exports. exclusive top end products for high While China is important to end markets and customers, towards Building Three Decades of Sino-Swiss Relations Switzerland economically (5% business models and products with of Swiss exports), Switzerland reduced functionality and lower cost Chapters in Geneva Sino-Swiss economic relations. Since 2010, the Chamber has accounted for less than 0.3% of products that better meet the needs and Lugano. Over “People build relations. Building also been commissioned by OSEC China’s exports in 2008. In such of lower priced segments. To do this, the years, it serves and keeping good relations is based Business Network Switzerland to a lopsided trade relationship, the R&D centers for certain products may as a network actively on mutual respect and trust and promote Switzerland as an attractive implication is that Switzerland will need to be shifted to the emerging contributing to the calls for a long-term commitment. business location and to host need to take on a very proactive role markets, where engineers who grew Sino-Swiss economic And, successful relations start with corporations, potential investors to shape the relationship and to up with an appreciation for products relations and a sincere interest for the people and and relevant public authorities ensure that it remains healthy. This that offer the minimum, but essential generating business the value-systems coming from Greater China. means exploring new avenues of functionalities required, make the key opportunities for of their social and The Chamber acts as an growth in exports for Switzerland, design and engineering decisions, Swiss and Chinese cultural environment,” official representative of the but also identifying other dimensions rather than a headquarters thousands entrepreneurs. said Susan Horváth, Swiss Federation to carry out of the bilateral relationship that may of kilometers away and out of touch Close to 700 Executive Director activities in Switzerland in bring value to China in other ways. with the local market. corporate and of the Chamber on close cooperation with the individual members, what contributed to Swiss Business Hub in China including the the success of the and in conjunction with leading banks, organization. the business development trading companies, The Chamber has agencies of the individual insurances and set up representative cantons. industrial firms offices in Beijing and “With the establishment have joined the Shanghai in 1995 of the Chamber 30 years ago, association making and 1996, which the founders have recognized it one of the largest today are operating the far-reaching economic bilateral chambers in independently but as reforms launched by the Switzerland. partnerorganisation Chinese government back The Chamber of SCCC under the then. It is a great privilege provides assistance name SwissCham that the Chamber and its Susan Horváth, Executive Dirctor, Member of The Executive Board to its members China. Besides these members have not only regarding entry to cooperation partners, witnessed China’s resurgence China’s dynamic the Chamber also is and a unique history of one In 2010, the Swiss-Chinese Chamber market. It offers advice, information the home of the Swiss- of the fastest globalization at of Commerce (SCCC) celebrates services and business contacts. Hong Kong Business work, but to be able to actively its 30th anniversary in conjunction Moreover, the organization Association (SHKBA), contribute to the Sino-Swiss with the 60th anniversary of Swiss- maintains and strengthens contacts founded in 2004 in Zurich with the economic and trade relations since Chinese diplomatic relations. The with government authorities, aim to support Swiss companies then. SCCC is looking forward to Chamber was founded in 1980 as economic institutions and trade doing business in Hong Kong and to increasing the friendly and fruitful a private non-profit association associations of both countries, facilitate market entry especially in economic ties between Switzerland the Pan Pearl River Delta region. and China,” said Ms Horváth. with headquarters in Zurich and promoting the development of the SWISS FACTS Swiss Companies Ramp Up Local Presence in China as Population: 7.79m Location: Central Europe Exports Continue Strong Growth Capital city: Bern Unlike many western countries, the market for additional supplier chemical and biotech sectors.” complement its existing network Languages: (Swiss) German (64%), French (20%), Italian Switzerland is one of the few to have relationships. Manufacturing and machinery locations in Singapore, Jakarta and (7%), Romansch (1%), others (8%) achieved a trade surplus with China Another Swiss company, are not the only sectors with an Hong Kong. Government: Parliamentary Federal State since 1848, direct since 2003. June 2010 export figures Endress + Hauser, in measurement optimistic outlook on China. In education, universities are democracy show overall Swiss exports to the instrumentation for industrial Banking and education are also also following suit to meet the Cantons: 20 full cantons, 6 half cantons EU grew by 15%, while exports to process automation and engineering showing significant investment. shifting needs of students. St. Gallen GDP: 124.380 China increased by an incredible has been involved in the Chinese Switzerland is home to more University, one of Switzerland Annual growth: 1.6% and Europe’s leading schools 42.3%. As Western Europe and the market since the 1980s. With 16 than a quarter, or $1.8 trillion, of Major industries: machinery, chemicals, watches, textiles, United States face slowing market offices and a regional headquarters the world’s offshore wealth. As for business and economics, is precision instruments conditions, more Swiss companies in Shanghai as well as a production global wealth is shifting, Swiss looking to establish a China hub in are taking steps toward China to center in Suzhou, the company banks are increasing their ties Beijing in the first quarter of 2011. secure their long-term viability and expects to see continued growth with Asia through investment and Already with a branch office in international competitiveness. within the Chinese manufacturing partnership. Singapore, the school’s new China In the first half of 2010, China industry. Swiss private bank Sarasin office will coordinate and reinforce became the second largest “Sauter in the field of building initially entered the Asian market research activities and corporate importer of Swiss machinery after management systems, automation through a partnership with partnerships in the region. Germany. This is good news for and system integration in energy Rabobank in 2002. Since then, Bank As Swiss companies participate Swiss companies like Hatebur efficient solutions is also ramping Sarasin has expanded substantially, in China’s economic growth, the Metalforming Equipment Ltd in the up business in China to meet including establishing a Hong Chinese are also benefiting greatly business