China's enterprise development African markets must pay attention to things
Tag: African market, China enterprise development
Summary: For an enterprise, "Go Global" is an inevitable requirement posed by the social and economic developments under globalization. A Chinese enterprise must go out of its own country, develop and expand…
For an enterprise, "Go Global" is an inevitable requirement posed by the social and economic developments under globalization. A Chinese enterprise must go out of its own country, develop and expand business in other countries or regions that best suit its self-development.
if it aims to become bigge rand stronger, making itself into an international corporation. At present, the world economy is on a downward slide, and China's domestic economic structure is in a period of adjustment. As a result, for many enterprises of great strength, exploring and developing the Africa market is not only a sensible choice, but also a novel opportunity for development.
China Should Watch out for When Developing Africa Market
(1)Strengthen research and investigation; understand the national conditions of African countries.
Africa is home to a large number of countries with different economic and political development levels and policies.
Therefore, China must strengthen researches and investigations of the country in which China is going to make investment by carrying out adequate market research and necessary on-site investigations on the political environment and risks.
comprehensively analyzing and studying the local investment environment, laws and regulations, foreign exchange policies, market demand and potential, labor cost, purchasing power, resource advantages, etc, and making investment plans on the basis of current market conditions and development potentials of African countries.
In terms of deciding the site and size of an investment project, the Chinese enterprises may consider making use of the industrial parks or free trade zones established in Africa by the Chinese government as a platform, and using China-Africa Development Fund as the source of capital for investment.
(2)Maximize favourable factors and minimize unfavorable ones, and give full play to one's own advantages.
Strictly speaking, Africa is not a virgin territory that is totally undeveloped. While the western countries had enslaved African countries for several hundred years, they also established some relatively modern industries, and monopolistic positions in many important fields.
It is the initial stage for the Chinese enterprises to go into Africa, so they must, based on their strengths instead of weaknesses, select appropriate project to initiate investment and partnership, and apply business strategy in accordance with their own advantages and strengths.
For example, Chinese enterprises have strong competitiveness in areas of light and textile industries, household appliances, food processing, water conservancy construction and agriculture, and monopolistic advantage in road and bridge construction in some African countries.
The Chinese enterprises may take the aforesaid fields into consideration and make the right investment in Africa and avoid making blind moves or repeated construction projects in the same country or the same region.
(3)Avoid "upstart mentality" and establish long-term operation awareness.
In recent years, some Chinese enterprises have sought short-term successes and quick profits when they make investment or do business in Africa, which have caused adverse results.
In terms of development, the enterprises should change their attitude and give more importance to building up a sound foundation for long-term development when they invest in African countries.