Two months after the zero Covid policy was lifted, China wants to revive its economy. Some provinces have embarked on real seduction operations aimed at Europeans and, in particular, the French.
China, the world’s second largest economy, has been affected by three years of health restrictions. For two months, the country has been reopening its doors with the end of its zero Covid policy. Many regions are again trying to attract foreign investors, particularly in Jiangsu province, about a hundred kilometers from Shanghai.
In one of the largest vacuum cleaner factories in the world, in Suzhou, the production lines are returning to pre-crisis rhythm. On this production site, 10 million vacuum cleaners are manufactured each year, a large part of which are sold in France, all brands combined. According to one of the site managers, during these three years of Covid, the factory faced a significant drop in exports, because with the closure of borders, physical links with foreign customers had become impossible.
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It is for this reason that, even before the lifting of health restrictions in December, the city of Suzhou was one of the very first in China to charter a plane to Europe, to allow companies local authorities to re-establish contact with their European customers. This direct contact with customers now replaces the video meetings that had been practiced for three years in China. Managers from the vacuum cleaner factory were part of the trip. “This face-to-face meeting with customers was very important. It will take time to get new projects and receive new orders.”
“Meeting overseas customers as soon as possible will help us resume normal production as soon as possible and increase our sales.”
A manager of a vacuum cleaner factory in Chinaat franceinfo
This city of Suzhou is one of the big manufacturing centers in China with in its suburbs huge industrial areas where tens of thousands of companies, especially foreign ones, are located. We find, for example, the French company Decathlon which assembles bicycles for the Chinese market. In these business areas, there is still plenty of room to accommodate new factories, but since 2020 foreign companies have been put off by the zero Covid policy. Investments were put on hold, China was no longer considered an economically reliable country, where a factory could be shut down within hours by decision of the authorities.
Turning your back on the Covid period
There is therefore a lot of work to be done to restore confidence. This was the purpose of this first trip to France, explains Xiaosu Cao, manager of one of the activity zones. “When we arrived in France, we went to see our current clients, but also potential new clients and several institutions. We spent a total of four days in France, particularly in Lyon where we saw the Mérieux Institute for Biomedicine We presented them with the current situation in China and Suzhou. Our French customers have asked us about the epidemic in China and the development of the economy. I think their hesitation is understandable, they fear a repetition of the measures. health, but from my personal point of view, the country has already been liberated. Most of us had the Covid at the end of 2022. We are recovered.”
“Even if the epidemic happens again, I think we can all face it and live with it and it won’t affect economic development.”
Xiaosu Cao, responsible for one of Suzhou’s business areasat franceinfo
The local authorities are promising aid and financial facilities for all foreign companies that agree to set up in one of Suzhou’s business zones. This city also has the largest factory in the world of another French group: L’Oréal. This site now hopes to take advantage of the end of health restrictions. I‘Oréal is also the first company that the municipality of Suzhou came to meet during its visit to Paris. During the epidemic, the factory ran out of raw materials, which affected production.
The weakest growth for 40 years in 2022
The situation is now back to normal. At the head of the factory, Xiangling Lu awaits the first fallout from this new post-Covid era, with perhaps an expansion of the site. “The good news is that on March 20, L’Oréal’s grand chief in charge of industry will come with his team to visit the Suzhou factory. It will be their first visit after three years of the epidemic. Behind I, you see, there is a new building with empty workshops. There are certainly many new opportunities. They will look into this. We must prepare our factories for an increase in sales and production. Indeed, it is likely that more and more Chinese women will gradually take off their masks. This means that they will use our cosmetics more. There will be more consumption.”
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As in Suzhou, other Chinese municipalities and provinces have also organized trips abroad with one objective: to respond to instructions from the central government. The power has made the revival of the economy the absolute priority. The objective of the Chinese today is to forget the covid years in particular 2022 which gave China a growth rate of only 3%, the lowest rate for 40 years.