We have updated our Membership Directory, which is primarily available to our members.  If you are a member and have not received a copy, please contact our office.  In addition, we have made a presentation - "The Next Gold Rush for U.S. Companies and Professionals," which was made in various
conferences, available to the public, if you are interested in getting a copy, please download an information sheet, complete and return it to us. We will then send you a copy and put you on the mailing list.  The information will be updated on a regular basis.  Any comments will be welcome.

Our organization is built on helping U.S. companies to stay competitive in this global market with an emphasis on the manufacturing industry.  In the last 12 months, I have seen many changes in the global market, and the following is a summary of my observations:
 

• Companies in the basic manufacturing sector will face enormous challenges in the next few years.  This applies not just to U.S. companies but also to their Chinese counterparts.  In fact, we have seen many Chinese manufacturers are struggling and China is losing jobs in the manufacturing sector.  With an inflation rate of over 7%, an increasing wage, a cumbersome worker benefit system, an evaluating RMB, and an aging population complicated by the one child policy, some of the low value added manufacturing jobs are migrating to other developing countries such as
  Vietnam, while some of the higher value added jobs are coming back to the U.S.  As India and Brazil aggressively expand their economies through various incentive programs to attract FDIs primarily in the manufacturing sectors, capacities will continue to expand and become significantly excessive.

 

•  Many Chinese factories prosper because they are involved in other businesses, primarily real estate.  Often, they use the land as collateral to obtain financing to support their real estate
  development projects. 

 

• The next gold rush for U.S. companies will be in the areas of technology based high value added manufacturing, healthcare, education (training), foods and farming, luxury yachts and private aviation. As China is moving up the food chain, they are looking for more precision,
  automated manufacturing.

 

• Some analysts are bullish about the auto industry in China.  In fact, China has been the promise land for many car and auto parts companies and continues to grow at an accelerating pace.  However, in my opinions, U.S. companies hold competitive edge primarily in the area of car
  design; engine; transmission; advanced auto electronics; and engineering.  I believe that the car industry in China will saturate quickly because China simply does not have enough space to handle traffic across the nation except in certain remote areas.  The market is very competitive with new companies getting into the market on a daily basis.  The window of opportunities for
  U.S. auto parts companies with niche products, engineering capabilities, and brand recognition continues to exist.  U.S. companies need to have a sense of urgency and move fast.

 

• Luxury goods will do well in the next 10 years as an ideology of symbolism overshadows the practicality of success. However, entrepreneurs with foresight and patience should be prepared that a whole new market will develop as rich Chinese will turn to intangibles that are spiritual, cultural and superstitious in nature when luxury brands will no longer fulfill the symbols of wealth and when conscience begins to kick in.

Manufacturers are a building block of our organization.  We are committed to continue to work with them to understand the dynamics and to prosper in this changing market.  Our goal is to help manufacturers identify selling opportunities in China with an expansion to other areas.  Our focus will be on niche products, technologies, product and work safety, training, healthcare, foods and farming, and other select industries such as aviation and luxury yachts.  Our strategy is to leverage the relationships that we have built with various parties in the last 10 years and to become more proactive.  We will strengthen our communication with our members and will inform them with specific information about our programs and opportunities that we see or develop.  We are in the process of hiring new staff and restructuring our organization.  Further information will become available shortly.  As usual, any suggestions will be much appreciated.

 

  >>>Click Here to Subscribe for a Copy of "The Next Gold Rush For U.S. Companies and Professionals" Presentation

With best,

Siva Yam, CPA, CFA
President
U.S.-China Chamber of Commerce