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SUBMISSION from ANGUS COUNCIL Introduction 1. I Have Been SUBMISSION FROM ANGUS COUNCIL Introduction 1. I have been asked to submit evidence to the European and External Relation Committee of the Scottish Parliament on the Scottish Government’s strategy for engagement with China and to give specific views on:- • The appropriateness of the objectives set out in the China Plan. • How the objectives compare to those set by the former Scottish Executive’s China Strategy. • What I think the impact might be. • Any other points of reference. 2. This evidence represents my own personal views. My own experience and area of expertise is trade and tourism as outlined in Appendix 1. Therefore, the undernoted views are focussed mainly on objectives 4, 5 and 6 of the China Plan. General Comments 3. In my view, all of the objectives set out in the China Plan are appropriate and will contribute significantly to the Scottish Government’s Economic Strategy for sustainable economic growth. The plan ties in specifically to three of the Scottish Government’s main objectives of making Scotland Wealthier and Fairer, Smarter and Greener. It also fits well with the Government’s three international objectives as set out in paragraph 11 of the plan. 4. In my opinion the targets for objectives 4, 5 and 6 in the China Plan lack specificity and milestones should be set for delivery. Moreover, there is no budget set for delivery of these objectives. There is also a lack of systematic planning and monitoring of the plan with stakeholder groups and there is an apparent lack of wholehearted engagement by Scottish Development International; without which the aspirations of the Scottish Government’s China Plan will not be fully achieved. 5. For these reasons I believe that the proposals made for implementation of the plan have fallen short of expectations. A concerted effort is now required to fulfill a number of proposals set out in paragraph 34 which outlined specific actions on the role of the “Scottish Government and its agencies” and “working with departments, agencies and stakeholders”. In particular, some real progress is required in relation to:- • Co-ordination with stakeholders groups to agree priority sectors/areas and annual plans to achieve specific objectives; I would urge that sectoral groups be convened as early as possible with the remit of formulating action plans for engagement; • Creation of sector groups that will bring together stakeholders from across different sectors, and develop cross sector plans and initiatives, where it makes sense to do so. I have recently accepted an invitation to join a tourism group and look forward to this meeting being convened soon; • Establishing a high level strategic stakeholder group which meets approximately on a six monthly basis to review China activities, to reassess the direction of the Scottish Government’s activity and to facilitate discussion of ideas and to communicate progress; This is essential to monitor progress and make adjustments to the strategic direction if and when required. • Establishing clear lines of communication with other Government departments, agencies and wider stakeholders to facilitate discussion of ideas and to communicate progress. 6. Notwithstanding the above, the efforts made by the Scottish Government officials in planning and implementing the “China Now” programme in Scotland has been excellent albeit this initiative has justifiably tied up staffing and other resources. Also, the participation by the First Minister and other Scottish Ministers in the “China Now” programme as well as the organisation of several Ministerial Visits to China during 2008 must be applauded. The enthusiasm and active participation by Scottish Government Ministers has been welcomed warmly by the Chinese Consulate. It should be acknowledged that this in turn has contributed significantly to a strengthening of the relationship between the Scottish Government and the Chinese Embassy and it’s Consulate in Edinburgh. The warmth of government-to-government relations is vital to the successful development of business-to-business links. Relationships with Shandong 7. My own experience with China has taught me that building genuine and lasting relationships is vital to building successful trade and tourism links. Angus Council’s special Sister City relationship with Yantai has helped to develop a real sense of mutual trust and respect – what the Chinese call “Guanxi’”. The fact that Angus Council has a dynamic and thriving relationship with Yantai makes it easier to form relationships elsewhere in China and it is important to highlight that some of our companies’ successes have happened elsewhere in China e.g. Jiaxing and Shanghai – not just in Yantai.. 8. For the same reasons I would strongly urge the Scottish Government to do even more to build on the existing links with the Shandong Government and to develop this relationship in a planned and focussed way. This action will bring a number of benefits as follows:- • In my view, further developing the existing links with Shandong will help to reinforce and promote Scotland’s status elsewhere in China including with the Beijing Government. Having a special link with Shandong, if developed in a planned and focussed way, will demonstrate Scotland’s desire to develop it’s links with China on a long term basis and this will aid cooperation generally. • Government-to-government links with Shandong – China’s 2nd most prosperous Province – will open doors for Scottish businesses and other organisations and assist in identifying and encouraging areas of bilateral mutual interest across all sectors. Shandong has a population of 92 million and has an extremely diverse and dynamic industrial and commercial base. The CBBC and the Centre for International Business – University of Leeds, recently published the results of a research study (Opportunities for UK businesses in China’s regional cities) on behalf of UK Trade and Investment (UKTI). This identified those “regional cities” in China that offer the greatest potential to UK companies as a business location. It is interesting to note that of the 274 municipalities in China with a population of over 1 million, 35 were identified as being “regional” cities on the basis of their economic size and population etc. It is also very interesting to note that a significant cluster of seven “regional” cities can be found in Shandong. The greatest distance between the four cities of Yantai, Quingdao, Weifang and Weihai is 175 miles while Zibo and Dungying are less than 65 miles from Weifang. There are seven cities in total including Jinan – the capital of Shandong. Such a close grouping of “regional” cities has beneficial impacts for businesses because according to the CBBC publication “it means that multiple city-level markets can potentially be served from a single or small number of business locations, thus reducing transportation and communications issues that might otherwise arise from cultural differences across larger geographical territories of China”. This, in my opinion reinforces the fact that Scotland and Angus are well placed in their respective choices of partners in Shandong and Yantai and there is an opportunity to work collaboratively (CBBC/SDI/LAs) both at home and in China to capitalise on the synergy afforded through these and future links in a way that targets these seven most prosperous and dynamic level 1 cities in Shandong. • Efforts to build an even stronger relationship between the Scottish Government and Shandong Provincial Government would encourage other Scottish Councils to follow the lead of Angus Council in the knowledge that building links with municipal level government will add great value to the efforts of the Scottish Government and its agencies in assisting Scottish businesses and organisations. If, in the future, other Scottish councils are successful in developing similar links with other municipalities in Shandong, an opportunity will exist to work more on a collective basis when planning trade missions and developing cooperation between tourism venues. It will also enable the sharing of internal networks and contacts thus adding value for the benefit of participating businesses and other organisations. This would have a clear benefit in creating awareness of Scotland for the increasing numbers of travellers from Shandong who should be encouraged to look at Scotland as a destination of first choice. The CBBC publication referred to above has identified a number of “regional cities” in Shandong that would serve as suitable prospective partners for Scottish councils interested in working collaboratively. • Developing dynamic networks within Shandong will provide a platform for links elsewhere in China. For examples, Angus Council’s link between Tiger Beach Golf Course and Carnousitie Golf Links is what led to the extremely successful relationship with Beta Soong the owner of Shanghai Silport, who was acknowledged as a Global Scot in 2005. Through this link, other projects and advances have been made e.g. launch of a range of golfwear under Carnoustie Country brand by a Shanghai company whose owner visited Carnoustie on the Tartan Day Scotland International Golf Challenge in 2006 (arranged by Shanghai Silport). • Considerable assistance is made available by SDI to help prepare companies for market entry including market research in preparation for organised trade missions. This is much valued by the companies involved. However, there is no in-market assistance available during trade missions other than at formal briefings. A more concerted effort by SDI to become involved and even accompany trade missions e.g. by Angus Council, while in China would help to optimise and maximise efforts by ensuring that all opportunities that are identified as being of potential benefit to Scotland (e.g. rather than just Angus) can be followed up and developed. In this way the synergy of working together while in-market by sharing networks and relationships can be harnessed better for the benefit of Scotland as a whole. Size of Company 9. More could and should be done to champion the success of small and medium companies.
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