Editor's note: Thanks to the resumption of work and the rebound in economic activity, many foreign businesses believe they can see light at the end of the tunnel in China as the country flattens the novel coronavirus curve. The nation's annual political gatherings－the two sessions－started on Thursday. In response, China Daily polled senior executives of multinational corporations, who shared their views about anticipated policies, business adjustment and consistency in light of the pandemic and the emerging opportunities derived from the crisis.
(SONG CHEN / CHINA DAILY)
Q1: This year's national two sessions were postponed for over two months due to the coronavirus outbreak. What policy guidelines are you expecting from this week's meetings?
Q2: The outbreak has caused disruption to the global economy. How is your China business recovering from the outbreak? Will your investment plans in the country change as a result of the virus?
Q3: The government has released a series of policies to help revitalize businesses. Which are the most helpful to your company?
Q4: Have you identified any new business opportunities after the coronavirus outbreak? Are there any new best practices in terms of business operations coming from China that are setting the trend for your business worldwide?
Andy Ho, president, Royal Philips Greater China. (PHOTO PROVIDED TO CHINA DAILY)
A1 We look forward to the government's continuous efforts to introduce strong measures to improve the business environment and facilitate health technology innovation."Healthy China 2030" has become a national strategy, and the concept of "big health" is being integrated into the management concept of governments.
Philips is committed to a local strategy that is fully aligned with the key initiatives defined by "Healthy China 2030".
A2 Although COVID-19 has made a great impact on some of our businesses, it has also brought great potential and opportunities.
We are exploring new business opportunities and growth points.
Our B2C team keenly grasped the two major needs of "stay-at-home" and "health", deployed specific marketing plans for key categories and utilized a new digital marketing platform to ensure the supply and logistics of hot-selling items to meet demand.
In the professional market, Philips' products and solutions are playing an important role in screening, diagnosis, treatment, and disease follow-up.
China's long-term economic vitality and potential, as well as the government's investment and commitment to health technology, have consolidated our confidence in the Chinese market.
A3 The strong prevention and control measures taken by the government have produced positive outcomes in the containment of COVID-19 in China.
As early as the beginning of February, our manufacturing facilities in China resumed production under the guidance and support of local governments.
With the synchronized resumption of upstream enterprises, our productivity has recovered, which is crucial for the company to fulfill our commitment to customers.
A4 Big data, cloud computing, intelligent manufacturing and the digital economy have made huge differences, showing strong potential and good development momentum.
This trend will continue to grow in the post-epidemic era. Philips is driving the digital transformation of the health technology industry.
We will enhance cooperation with the local ecosystem, continue to innovate and invest in talent, facilitate the development of smart healthcare, solve the problem of uneven distribution of medical resources, and create value for the transformation of China's healthcare system.
Stephan Kothrade, president, BASF Greater China. (PHOTO PROVIDED TO CHINA DAILY)
A1 We appreciate the efforts made by the Chinese government in helping companies like BASF.
We believe that preferential policies in tax and energy will be necessary to help Chinese chemical companies recover from this crisis. Also, the consistent inclusion of foreign passport holders in the QR health code system will be welcomed by foreign nationals in China.
A2 We anticipate a considerable decline in sales volumes in the second quarter of 2020 and a slow recovery for the third and fourth quarters.
How the situation develops is uncertain and not predictable. Most BASF sites and offices on the Chinese mainland operated continuously or have resumed operations.
We are committed to the long-term development of the Chinese market. Our investment projects in China, including the BASF Guangdong Verbund, are progressing as planned.
A3 The government has been ramping up monetary and fiscal responses to the pandemic in recent weeks, including increasing export VAT refund rates and direct financial support for employees' social benefits.
Most measures are targeted at bailout and relief, which has helped many companies, including BASF, to partly offset the negative impact of the pandemic.
A4 BASF makes products that are essential for containing and combating the coronavirus.
Now, customers from the pharma, detergents and cleaners sectors, and even food, are experiencing additional demand.
BASF is also enhancing its e-commerce presence in China.
On March 20, we launched a fully automated ordering system on Alibaba's 1688.com flagship online store, shortening the order-to-ship time from days to two or three hours.
Alain Crozier, CEO, Microsoft Greater China Region. (PHOTO PROVIDED TO CHINA DAILY)
A1 We hope to learn what measures the government will take to continue to support enterprises' and small and medium-sized businesses' resumption of production in the post-epidemic era, as it will help the technology community to understand how we can continue to support businesses and organizations that have not yet resumed work.
A2 The outbreak has affected our planning and strategy to a certain extent, but we remain confident in the Chinese market in 2020.
The urgent demand for remote working solutions, for example, caused many enterprises and organizations to take notice of Microsoft Teams, a key element of Microsoft 365, an integrated personal and organization productivity solution.
We're encouraged to see our technologies and products have been empowering millions of people and hundreds of thousands of businesses in their efforts to fight COVID-19 and revitalize productivity.
A3 We have experienced the challenges and urgent needs of our customers, especially small and medium-sized businesses and partners.
We are pleased to see that the National Development and Reform Commission has issued supportive and preferential policies in the "Partner Actions" to help small and medium-sized businesses not only resume production, but also achieve digital transformation so they can achieve even more business value in the post-pandemic era.
A4 We have seen so many great examples of schools continuing classes during quarantine via technology; doctors helping patients via video conferencing; companies continuing to operate with employees working from home by using our technology.
China is leading the modern workplace evolution, and it also provides a valuable reference for companies in other countries and regions fighting the epidemic.
We believe technology will play an essential role in the new normal, a hybrid working model that combines WFH (work-from-home) and WFO (work-from-office) to optimize productivity and balance for organizations and their employees.
James Chiu, managing direct-or, General Mills China. (PHOTO PROVIDED TO CHINA DAILY)
A1 We are eager to see what kind of economic stimulus plan will be discussed and approved to resume the growth momentum of the overall economy, create more jobs, raise people's incomes and encourage spending.
We also want to see China reassure the world that the open-up policy will be retained and even further enhanced to help the world fight a potential recession.
We will be also interested to learn the actions China will take to stabilize and improve the China-US relationship, including the trade relationship, which is the most important one in directing the long-term business and political environment.
A2 Thanks to the local government's strong support, our Wanchai Ferry plants (such as the one in Shanghai) resumed production on Jan 28, serving as one of the first reopened companies in the area.
We are seeing business coming back, and have confidence in a full recovery. As a core market, China plays a critical role in our global strategy. We have witnessed China's achievements in the past 30 years and have a long-term commitment to China. We will continue to be rooted in it.
We view the pandemic as short-term market volatility and were amazed by the effective and swift responses the Chinese government took to control the situation.
We have strong confidence in the government, and our long-term strategy and commitment to China will not change.
A3 Since the outbreak, governments at all levels have actively helped foreign-funded enterprises meet the challenges, coordinated and solved some practical problems in terms of investment, production and operation, and introduced policy measures to help revitalize business.
We have been given a range of help, such as matchmaking mask resources, providing disinfectants, official visits and others.
Also, the government has repeatedly inquired about our business operations, guided us to resume work and production in response to the challenges we face, and supported our work on epidemic prevention and control.
In addition, the policy of periodic reduction and exemptions of tax and rent, and government assistance in procurement have helped us withstand the epidemic and ensure orderly progress in the resumption of production.
A4 If there is only one opportunity we could pick, it would be to transfer the business model by "digitalization".
Before the pandemic, we had been talking about transformation by digitalization, but the sense of urgency was not strong.
What the pandemic changed dramatically is the sense of urgency and determination as such a transformation requires huge investment, not only in technical parts but also talent and reshaping of our organization.
We are taking a holistic approach to accelerate the transformation and act more agilely and responsively to the changing needs of Chinese consumers.
Kamran Vossoughi, president and CEO, Michelin China. (PHOTO PROVIDED TO CHINA DAILY)
A1 We hope to see more favorable government policies to inject new momentum and vitality for business development. Further optimization of the business environment can boost recovery.
The government has announced it will continue to promote the reform and opening-up policy and relax market access restrictions.
We look forward to stronger policy signals to implement more supporting measures. Sustainable innovation drives the future.
China is entering a new phase of high-quality development, with an economy that requires advanced business innovation.
A2 To mitigate the risks, we adapted to the changes in timely fashion, understood the market quickly and responded to demand swiftly.
We stabilized our business and achieved good performance results in March and April, which boosted confidence that we can recover fully and continue to grow.
Our confidence also comes from the resilience of the Chinese market, which is large and full of potential. Although the pandemic has taken a major toll on traditional consumption, online buying has grown explosively.
Needs have been delayed but have not disappeared, and will help to fuel economic recovery as the pandemic wanes.
We will accelerate our development in China beyond tires via green mobility and hydrogen fuel cells, as well as increasing our knowledge in smart mobility at our Innovation Center for Connected Mobility in Shanghai.
A3 To promote recovery, the government reacted quickly and responded early. Favorable policies have been implemented to benefit various stakeholders.
We believe these quick actions and concrete support from central and local governments helped our business recovery.
Proactive moves have been made by the government and more follow-up support is required to help sustain recovery.
It is suggested that forthcoming tax allowances for enterprises and individuals, and the strengthening of tax reduction and exemption policies, will encourage consumer spending.
We have seen a run on "cloud solutions" for government and enterprises, conforming to the trend of the digital economy and enhanced efficiency. We look forward to the popularization and application of e-government.
A4 We will strengthen the development of our sustainable projects for green, smart mobility, while the move toward "zero emissions" will be the driver of our development.
It includes product and service design, production across our industrial sites, high-tech materials and hydrogen mobility. We have already confirmed our participation in the third China International Import Expo.
It is a great showcase for our developments in sustainable mobility and for finding new business opportunities.
Denis Depoux, global managing director, Roland Berger. (PHOTO PROVIDED TO CHINA DAILY)
A1 We are expecting additional monetary policy measures.
The government announced fiscal and supply-side measures, with a magnitude and targets that will be more precisely defined during the two sessions.
China is not short of large infrastructure development needs like 5G networks, new energy, or massive regional developments like the Yangtze River Delta integration or the Greater Bay Area.
We could see more unconventional measures targeting not only "hard infrastructure" like railroads, ports, trains, but also the social infrastructure, such as healthcare, elderly care, education and reinforcement of the social safety net to weather unemployment and lower incomes.
A2 Thanks to the government's efficient handling of the health crisis, our China business is already back to normal, but uncertainty remains.
We believe this crisis will accelerate the trend of the Chinese economy toward domestic consumption, a service economy and a manufacturing economy driven primarily by domestic and regional needs.
Productivity and added value will become even more important, driving faster modernization of Chinese production facilities. Chinese innovation, design and engineering, new products and higher quality will find internationalization opportunities.
This is more important than international acquisitions driven by financial considerations.
Finally, the acceleration of the modernization of the social infrastructure will drive domestic growth and create new financing needs that can be served by new types of players.
The Chinese economy's resilience is critical for the world, but this crisis is different from the 2008-09 financial crisis. This time, China will not fuel the world with infrastructure spending, but will help companies that are positioned to serve domestic B2B and B2C markets.
A3 Central and local governments have focused on resuming work and production, and introduced numerous policies on fiscal, financial and material support, which have helped enterprises overcome difficulties. We have also gained a lot of "China experience" from the government's response to the epidemic.
A4 China is a source of inspiration for Roland Berger's consultants and clients in multiple dimensions. This crisis has revealed the power of pragmatic, fast-go-to-market innovations.
That has helped fight the crisis via tracking tools, contactless services applications, e-commerce and local delivery.
We are not talking about hardcore technology but pragmatic innovations that change our lives and help recreate proximity in a post-COVID-19 world.
Proximity is a key inspiration for us. Fighting the crisis has been possible thanks to mobilization of volunteers, communities, Party organizations and civil servants, all served by innovative tools.
