"After Chinese New Year, I think everyone will be busy traveling from Guangdong to meet up the clients all over the world while the world's clients will be coming to China to visit us and discuss new business. It will be a good year, a good start," said Nick Koay, Chairman of the Malaysian Chamber of Commerce and Industry China (Greater Bay).
According to the government work report, Guangdong will emphasize the fundamental role of the manufacturing industry and set a goal to increase the added value of industries above the designated scale by more than 5.5 percent in 2023.
Guangdong's business environment benefits manufacturing development
In 2005, Nick Koay set up an OEM (Original Equipment Manufacturer) factory in Zhuhai of Guangdong province and has been manufacturing cooking appliances and exporting to about 30 countries worldwide.
Koay spoke highly of the manufacturing industry of Guangdong and considers it the best in China for his industry. "It's very easy for us to find suppliers in Guangdong. And we managed to produce without stop over the past 3 years despite the pandemic, which is an advantage in China."
In addition, he said the geographical location of Guangdong a strength to Southeast Asian manufacturers. "It takes only 7 to 10 days to ship containers from Guangdong to Singapore, Malaysia and Indonesia with relatively low shipping costs while it's convenient for us to visit clients in the region."
The support from the government also benefits Koay's company. “We are enjoying the income tax reduction from 25 to 15 percent for high-tech enterprise. The government also gives our R&D team fund to develop new products,” said Koay.
To expand market overseas, Koay highlighted the Canton Fair which is one of the biggest exhibitions being held twice a year in Guangzhou. “I participate in the Fair every year to meet up with new clients as there are buyers from all over the world. As for 2023, we have already invested in some new products and plan to launch at the Canton Fair this year.”
ASEAN-Guangdong cooperation tightened in manufacturing sector
“I believe China still will continue to lead in world manufacturing and more Chinese manufacturers will go global and explore opportunities overseas,” said Koay. He believes more Guangdong manufacturers will set up plants in Southeast Asia, utilizing cheaper manpower and material resources to expand their market share in Southeast Asia.
Based on his observation, manufacturers in China keep investing in high technologies and quality products with higher added value. Some Guangdong manufacturers are seeking to move the production of their old models to Southeast Asian to achieve cheaper costs and feed the local market demand.
According to a report issued by Malaysia External Trade Development Corporation, manufactured goods account for 83.3 percent of Malaysia’s imports. In 2022, China remained Malaysia’s largest trading partner for 14 consecutive years.
Koay believes the cooperation between China and ASEAN countries will be promising as the trade cooperation between two sides has been mature while the RCEP brings a new system and a series of tax free policies.
“We have made plans to visit our clients overseas after the Chinese New Year and let them try our new products,” said Koay.