Multinationals View Shanghai as Burgeoning Buying Center

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Last updated at: (Beijing Time) Wednesday, July 31, 2002

Multinationals View Shanghai as Burgeoning Buying Center

Lured by the rosy prospect of Shanghai as a world buying center, an increasing number of multinationals are choosing to set up their production and purchasing bases in this city.

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Lured by the rosy prospect of Shanghai as a world buying center, an increasing number of multinationals are choosing to set up their production and purchasing bases in this city.

Daryl Rolley, Asia-Pacific region vice-president of the US-based Free Markets, a heavyweight service provider of electronic buying, said at a seminar here Tuesday his company planned to set up its sixth Asian branch office in this eastern China coastal city.

To accelerate the establishment of a cross-country purchasing center, the Shanghai municipal government will hold the first International Sourcing Conference at the end of September. So far, more than 50 multinationals including General Electric, General Motors and Carrefour have signed up.

General Electric sources said the company planned to purchase goods worth five billion US dollars from China by 2005 and at the same time generate the same amount in sales in the country.

A latest survey released by the Hong Kong Trade Development Council shows that about 70 percent of overseas importers believe Shanghai, as China's economic center, will gradually turn into an international buying center if it forges have a closer trade relationship with multinationals after China's entry into the World Trade Organization.

Shanghai trade official Xu Yibo said the city government will take more measures to improve the city's business climate and establish a sound distribution system as fast as possible.

By the end of 2003, the proportion of goods purchased by multinationals to the city's total exports would rise from the present four percent to 23 percent. Goods bought would be worth eight billion US dollars, Xu said.

In 2005, the proportion would climb to 52 percent and the value to 18 billion US dollars.

When the value of goods bought by multinationals hit 50 billion US dollars in 2010, nearly equivalent to the city's gross domestic product in 2000, an international buying center would finally take shape in Shanghai, Xu said.

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