Multinational giants including FedEx, the KKR and the WPP are eyeing enormous new business opportunities in China as the middle income population of the world's second largest economy surpasses 600 million -- 700 million in foreseeable future.
"Our focus in China has been 100 percent on the consumer. We don't focus on export businesses, we focus on local consumption as the consumers have gone up in their purchasing power," said Henry R. Kravis, co-chairman and co-CEO at Kohlberg Kravis Roberts (KKR), an American leading global investment firm.
Kravis was sharing the KKR's success stories with about 100 multinational giants who were present at the Fortune Leadership Dinner titled
"Multinationals in China: Maximizing the Opportunity" in New York on Monday.
For example, Kravis said, a syndicated farm group KKR built a few years ago now has 290,000 cows in 29 farms in China.
"The opportunity just goes to what is needed in China, whether it's an environment, whether it's food safety, whether it focuses on consumer."
The event, moderated by Alan Murray, chief content officer of Time Inc. and editor-in-chief of Fortune, was held in honor of China's fast-growing megacity of Guangzhou which will host the 2017 Fortune Global Forum on Dec. 6-8 this year.
"I'm happy to announce that we are launching liaison offices in Boston and Silicon Valley in Washington D.C. tomorrow, no matter how strong the snow storm may be," said Cai Chaolin, Guangzhou's vice mayor in his speech, referring to Washington's weather forecast for Tuesday.
There is no better choice than Guangzhou for hosting the world's economic forum, Cai said.
In 1784, a merchant vessel named the Empress of China set off from New York Harbor, loaded with American Ginseng, leather and cotton, arrived in Guangzhou after six months' journey, and took home tea, chinaware and silk, opening a brand new chapter in China-U.S. bilateral trade.
The floor was quickly given to multinational giants following the mayor's introduction of the 2,231-year-old city, which is economically ranked the third in the Chinese Mainland after Beijing and Shanghai, and which is on a par with Hong Kong and Singapore.
Frederick W. Smith, CEO of the world's largest express transportation company FedEx, said that FedEx has established an Asia-Pacific transshipment center in Guangzhou, through which many of its clients have gained access to China.
He said that there are great opportunities in the gradual liberalization of the logistics and transport sector in China as the country's economy is transforming from the export-oriented to consumer-driven.
Fred Krupp, president of the Environmental Defense Fund (EDF), said that China is now leading the way in fighting the climate change as the country has vowed to succeed to cap coal emission in around 2030.
"There's a lot of reasons to think this is going to happen even sooner," he said, adding that China is expanding the EDF carbon trading program in Guangzhou to the whole country in 2017.
"What does this all mean? It means opportunities for companies," he said, "The newest best practices, the newest best technologies, I think the opportunities are in this race for low carbon economy, which is starting right now in China."
Martin Sorrell, CEO of the world's largest advertising firm the WPP, also urged his counterparts to lay emphasis on the emerging markets including China.
"The next billion consumers are not going to come from the United States or Europe, but from Asia, Latin America, Middle East and Africa," he said.
Yet competition will be unavoidable as China's multinationals are becoming
"more and more powerful and more and more prominent on the world stage," Sorrell said, "There is a very interesting battleground."
"I just wanna end this with a sense of urgency. If you have not been to China this year or in the past two years, please visit China every month from now," said Zhang Qiyue, Chinese counsel general in New York, at the end of the event.
"If you, for the past 30 years, think China is already a big market, then in the coming 10 years or 20 years, or 30 years, China will be a huge market with a middle income population surpassing 600 million to 700 million," she said.
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