Lack of infrastructure, skills ‘hurdles’ to S’pore companies in Guangxi

NANNING — While Singapore companies have great interest in doing business in the less developed areas of China — this year’s China-ASEAN Expo (CAEXPO) in Nanning attracted the largest-ever delegation from Singapore — challenges with regard to operating in these areas need to be resolved before businesses can take off, said Singapore Business Federation (SBF) chairman Teo Siong Seng yesterday.

Mr Teo was speaking to reporters on the sidelines of a networking lunch with officials from the Guangxi region, a day after Prime Minister Lee Hsien Loong said at his meeting with Guilin Party Secretary Zhao Leqin that he hopes Singapore businesses are able to explore opportunities in Guangxi. Mr Lee is on a week-long visit to China and will end his trip in Hong Kong.

Mr Teo said the challenges in Guangxi include, for example, a still-maturing air-transport industry as well as a labour force that lacks professional skills.

“Guangxi is less developed, so air links (are fewer). The fact is many of us have to go to Guangzhou or Shanghai to come here,” he said, adding that there are also not enough professionalsin Guangxi, such as in finance.

Nonetheless, he expects these issues to be resolved eventually. With other coastal areas of China very developed, Mr Teo, who is also managing director of Pacific International Lines, said it is “a good time to look at a city like Nanning”, the capital of Guangxi, and considered a “second-tier” city . There are 260 businessmen from 90 Singapore firms exhibiting at CAEXPO, a surge from 48 last year.

Other opportunities Singapore companies can explore include linking up with Chinese firms for opportunities in other developing countries, as Chinese companies are keen to work with Singapore organisations, he said.

“I think they also realise there are a lot of good practices that Singapore can offer,” he said.

With the Chinese government keen on developing a new 21st-century Maritime Silk Road, it could improve linkages to ASEAN cities, making Singapore an important hub for both regions to pass through, he added.

In a meeting with Mr Lee yesterday, Guangxi Party Secretary Peng Qinghua laid out potential areas of cooperation between the Republic and Guangxi.

Last year, trade value between the latter and Singapore amounted to US$660 million (S$834 million) — a 172 per cent increase year on year, said Mr Peng. He hopes to expand cooperation in trade, investment and finance, as well as tap Singapore’s expertise in hosting conferences and exhibitions.

Mr Lee also met Vice-Premier Zhang Gaoli yesterday, when they reaffirmed the excellent bilateral relationship between the two countries and exchanged views on the Chinese proposal for a third government-to-government project in China’s western region, said a statement from the Prime Minister’s Office.

Mr Lee also visited commercial exhibitions set up by Singapore companies led by the SBF for CAEXPO.

He will deliver the keynote address at the joint official opening ceremony of CAEXPO and the China-ASEAN Business and Investment Summit today. He will also officiate the opening of the Singapore Pavilion with Mr Zhangand attend a dialogue with CEOs of major Chinese companies.