Exporters cheer Chinese President Xi’s pledge to open up markets

Exporters have welcomed President Xi Jinping’s speech promising to open up China’s market and boost e-commerce.

China's President Xi Jinping is seen on a big screen in the media centre at the opening of the China International Import Expo in Shanghai yesterday. Picture: AFP

Australian companies have welcomed President Xi Jinping’s landmark speech yesterday promising to boost e-commerce in China, reduce tariffs, boost domestic consumption and other measures that could see more Australian exports to the world’s second-largest economy.

Companies with business interest in the country, including Fortescue Metals Group, vitamins groups Blackmores and Swisse, and a2 Milk said the comments were a firmly positive sign.

“Mr Xi has sent a clear message that China is going to continue to support and enhance the cross-border e-commerce channel,” Justin Howden, group head of government affairs for H&H group, which owns Swisse, told The Australian yesterday.

“This is great news for Australian brands looking to the Chinese market for expansion, as it provides more certainty on continuing, stable policies and therefore more impetus to continue to invest in the market.

“As Chinese consumers are among the most discerning in the world, it’s particularly good news for high-quality, premium brands such as Swisse.”

Fortescue chief executive Elizabeth Gaines said Mr Xi’s comments underlined the positive outlook for the Chinese economy. “It’s a reminder that China is in a very strong position and there are a number of levers the government can use to continue to stimulate the economy and drive that very strong GDP growth,” Ms Gaines told The Australian.

China trade with Australia in $ bn

“There’s no doubt that protracted periods of trade protectionism have not been positive in terms of world growth.

“If you look back over time, trade protectionism tends to have a negative impact on the outlook for global growth. Having said that, I think China is in a very strong position to continue to stimulate the economy. They can do that through further investment in infrastructure, and investment in infrastructure drives demand for steel, and that drives demand for iron ore.”

Iron ore prices have rallied in recent weeks amid data showing a rise in steel production out of China. “Steel demand is very strong, steel production is at high levels, and that’s driving that strong demand for iron ore. So we see a continuation of what we see as favourable trading conditions,” Ms Gaines said.

Blackmores chief executive Richard Henfrey, who is attending the first China import expo, which opened in Shanghai yesterday, described Mr Xi’s speech as “inspirational”.

“Blackmores is very pleased with Mr Xi’s comments to increase imports, continue upgrading domestic consumption in China, further expansion of free trade zones and encourage more cross border e-commerce,” Mr Henfrey told The Australian in Shanghai.

“The President gave a clear message of his view of the importance of inclusive world economic growth.

“It reflects China’s 40 years of opening up and reform.”

The managing director and chief executive of a2 Milk, Jayne Hrdlicka, said: “The a2 Milk Company is particularly pleased with Mr Xi’s announcement. China is one of the world’s most attractive markets with a growing population of 1.3 billion and the world’s second-largest economy.

“As a producer of high-quality and unique milk and nutritional products, we look forward to a long and prosperous future with our most important trade partner. We deeply respect the importance of regulatory development which seeks to protect Chinese consumers and continue to improve its cross-border processes.

“We see the new e-commerce legislation as an important next step in China’s developing digital retail economy.”

Federal Trade Minister Simon Birmingham said he welcomed Mr Xi’s “strong commitment to China’s ongoing reform and opening up, and his remarks around working with others to preserve and strengthen the rules-based multilateral trading system”.

He said the Shanghai expo showed there were “continuing opportunities for Australian companies from China’s economic transition and opening up”.

“I particularly welcome Mr Xi’s announcement of new market ­access, improvements in the education and health sectors, which could provide further opportunities for Australian higher education providers and health services companies to operate in China,” he said.

Mr Birmingham said he was also pleased to hear Mr Xi’s “commitment to improving the system of intellectual property protection and enforcement in China”.

“This has been a persistent irritation for foreign companies, including Australian companies over many years, and President Xi’s signal in this regard is an encouraging development.”

HSBC’s Asia-Pacific head of commercial banking Stuart Tait said the China expo “has highlighted that China’s economy will become more open, which is a positive message for businesses everywhere”.

Additional reporting: Paul Garvey, Eli Greenblat