China-based Taiwanese businesses need to build branding strategies to avoid negative effects of China's plans to cool its runaway economy, business experts said yesterday.
"The advantage points of Taiwanese businesses operating in China lie in their product quality, marketing strategies, organization and management, with which few mainland businesses can compete," James Huang (
The seminar was held to discuss challenges facing Taiwanese businesses as China tries to rein in its overheated economy.
Regardless of the future impact of China's credit-tightening mea-sures, Huang said that building up brands will help beef up the competitiveness of Taiwan's businesses locally and internationally.
As for possible impacts on Taiwanese businesses in China following that country's economic cooling-off measures, Huang said these impacts should be small because Beijing's macro-economic control policies focus only on certain sectors, such as steel, cement and property.
"Few Taiwanese businesses will be affected by China's credit-tightening measures, since they hardly made loans from mainland banks," Huang said.
Kao Charng (高長), a CIER director, said he believes China's cooling measures only aim to address its over-heated domestic demand and investments, which grew by 43 percent in the first quarter.
"China should be able to head off this crisis with a soft landing, which will make less impact on neighboring economies," he said. "And China's economy is unlikely to go into recession despite slower growth."
Fu Fong-li (傅峰林), vice president of NOVA Computer City, agreed that building up brands is a key way to fend off stiff competition with Chinese businesses, which he said are notoriously aggressive. But Fu was not as optimistic as his peers in yesterday's seminar.
"There would be a severe impact [on Taiwanese firms] if China thoroughly implements its cooling measures," Fu said. "The raw materials and manufacturing sectors will be hit the hardest by these measures, while the service sector is expected to see another wave of negative impact within the next three to six months."
Regarding the recent credit crunch among Chinese banks, Alex Lin (林志宏), first senior vice president of the Shanghai Commercial & Saving Bank's (上海商銀) offshore banking unit, yesterday said that Taiwanese businesspeople can take advantage of Taiwanese banks' offshore banking units to meet financing needs.
But the chance for China to appreciate its renminbi this year is slim since it has a bigger economic plan ahead to pursue, although the Chinese currency is still undervalued, Lin said.
"We may see a window of opportunity next year for the Chinese yuan to gain by, say, at least 10 percent," he said.
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