ASIA NEWS NETWORK

WE KNOW ASIA BETTER

» Business

China's reforms spell good news for S'pore firms

Publication Date : 17-03-2014

 

An "anti-smog" war waged by Chinese Premier Li Keqiang, along with promises of more market access and less red tape overall, has excited Singaporean waste management firm Wah & Hua.

Its senior business manager, Melissa Tan, told The Straits Times that the firm is looking to expand its waste management and recycling business by establishing a one-stop centre for waste management in China.

"We welcome the emphasis on tackling environmental pollution," Tan added.

This means treating industrial and commercial waste, and converting them into processed raw materials and renewable energy, she said, which falls fittingly in line with Beijing's efforts to "turn the energy conservation and environmental protection industries into dynamic sunrise industries".

Li's pledge to wage war on China's chronic environmental pollution, as well as a slew of pro-business policies, were part of his government work report on March 5 at the National People's Congress, China's Parliament.

Many other foreign businesses are reportedly attracted by China's push to further open up its US$9 trillion economy, building on a slew of tough reforms unveiled at a key Communist Party summit last November.

But many are also biding their time as they wait for details of the reforms to be fleshed out.

Some of the tentative changes include scaling up reforms already in place in Shanghai's free trade zone (FTZ), such as simplifying the business registration process and expanding the use of a "negative list" for investments. This would allow foreigners to invest in any sector except those on the list.

Li also pledged to "move faster to open banking, education, culture, medical care and other services to foreign investment in an orderly way... and actively participate in developing high-standard free trade areas". He promised to strengthen the protection and use of intellectual property (IP) rights.

Chief executive of Singapore start-up Hexalotus Technology, Ho Poh Fwai, whose firm specialises in medical 3D modelling, said the biggest obstacles to his firm expanding to China are red tape and the lack of IP protection.

"But we are very encouraged by all the pro-business measures, including the reforms to move faster to open up medical-care services to foreign investment," he told .

The reforms to strengthen protection of IP rights - which he hopes will be an actual enforcement rather than just a verbal commitment - and a system to publicise all items over which government review and approval are required are also moves in the right direction, said Ho.

Secretary-general of the Shanghai Singapore Business Association, Ong Khim Kiat, told The Straits Times that the reforms reflect an "improved business environment".

He said the wider adoption of the negative list would be the most important change.

Singapore Chinese Chamber of Commerce and Industry president Thomas Chua thinks Singapore firms should take advantage of China's reform agenda to step up their expansion plans.

"We see favourable prospects for the larger local companies in banking, oil and gas, power, and environmental businesses, which are opening up to private investment," he told The Straits Times.

"E-commerce is certainly an area worth considering. With greater infocomm connectivity being planned in cities and villages, Singapore firms could look into the potential of tapping the Chinese market even without investments in physical shops."

Singapore Food Manufacturers' Association president Thomas Pek is similarly supportive of the reforms. He said reducing red tape will send a clear signal to foreign investors of what to expect.

"With a degree of certainty in dealings with local officials, a great deal of unfruitful time and, possibly, money can also be saved," he told The Straits Times.

But it is not just Singaporean firms that are happy at the prospects of a more open economy.

Brendan Mason, chairman of the China-Australia Chamber of Commerce in Beijing and the general manager of the China branch of a biotechnology firm, told The Straits Times that the government's push to free up the health-care sector is promising.

Although currently lacking in details, the broad direction that Li has set the economy on is "right on the money", he said.

"But I think more can be done and China can consider taking larger risks. Rather than just having a small-scale FTZ, how about opening up a whole province?" said Mason.

 

Mobile Apps Newsletters ANN on You Tube