For any business looking to expand, exporting overseas is often a common step. This allows exposure to a new market, one that may not be as competitive as the domestic one and that offers plenty of new opportunities. It makes sense to choose a large market in most cases, which is why China is a popular destination to start exporting to. Especially as China embraces globalisation by championing economic and trade cooperation, there are many opportunities to export to the world’s largest country. However, it still holds a number of restrictions as well.
Opportunities in the Chinese Market
Based on GDP, China is the world’s second largest economy. It has been growing for many years though, with importing and exporting levels amounting to trillions of dollars. In 2017 the country imported US$1.81 trillion worth of goods and accounted for 11.5% of all global imports.
China has a population of over 1.3 billion people, offering many opportunities for businesses to expand. Its top import sectors in 2017 included electrical machinery and equipment, mineral fuels, machinery including computers, vehicles, plastics and more. As some of the largest import markets these show plenty of demand and opportunities for businesses to easily entre the market.
There are plenty of emerging markets in China as well, providing great opportunities for smaller businesses especially to fulfil some of the growing demand. Over the past five years some of the fastest growing imports in China have included:
- Art and collection items
- Dairy, eggs and honey
- Gems, precious metals and coins
If you run a company that specialises in any of these products or is looking to expand its range, then these could present a good option as demand in China is growing. Alternatively, if you’re looking to set up a business focused on exporting to China then one of these sectors could provide a great starting place.
Restrictions, Prohibitions and Trade Tariffs
Despite all the exporting opportunities China presents, there are still a number of goods prohibited or restricted from being imported into the country. Many of these items are commonly prohibited in most countries and unless you work in a risky sector, it’s unlikely your business will be looking to export them. These include arms, ammunition and explosives, lethal poisons, illicit drugs, counterfeit currencies and more.
However, it’s important to be aware of some other prohibited items that are more specific to China. Any printed matter, films or photographs that are deemed to be detrimental to China’s political, economic, cultural and moral interests are banned, along with old or used garments and food items containing certain additives. Then there are restrictions on such as some steel products and certain raw materials.
Any businesses hoping to export food stuffs, clothing or materials should be aware of these prohibitions and restrictions, to check that they have a viable business model. Recently the USA has also imposed many trade tariffs on China to make exports from the country a lot more expensive, in a political move. However, China has retaliated by imposing tariffs on imports into the country as well, which affect businesses from any nation looking to export there. These can make doing such business a lot more expensive and off-putting.
China provides plenty of opportunities for small, medium and large companies to begin exporting and expanding their business abroad, though it is necessary to be aware of all the restrictions and prohibitions beforehand.