China Insights

GCiS shares a mix of China economy and business observations, industry articles based on recently published multi-client reports, infographics composed with public statistics and annual reviews of China demographics.


The China LED wafer market: A story of commoditization

This article is based on a GCiS multi-client report: China LED Wafers Market Research Report.

In the September 2012 edition of LEDs Magazine, an analyst from GCiS examines China's quest to develop the domestic LED industry, and how the high and medium-power LEDs have been resilient to the traditional commoditization model whereas declining prices and overcapacity witnessed in the low-power LED market suggests overinvestment. The article also explains how the value chain will congregate around three distinct steps over the course of the next decade steps. Presently, by comparison, the market sees four or more process layers in the value chain which strip the industry of efficiency and profits.

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Importance of China to Western Multi-Nationals

5 Years ago, Now, and Going Forward
Just How Important is China to Western MNCs?

Just how important is China to western multi-nationals? For years we have been hearing talk of how important China is going to be to western business, and how China as well as other BRIC and developing countries would drive growth for these companies. One of the best ways to measure this is to look at the total contribution of China to the total revenues of leading multi-nationals in China- now compared to several years ago. So is this potential now being realized?

The short answer is, with exceptions, yes. The average China revenue of 20 large multinational corporates increased from USD 2.8 Bn in 2006 to USD 6.1 Bn in 2011- thus more than doubling in this five year period. Just as important, for this sample of 20 MNCs China now accounts for nearly 11% of their global revenues as of 2011.

One big reason for this is that China's market itself has increased substantially, both in absolute terms as well as a percent of the world economy. In 2006 China accounted for 5.6% of the world economy (nominal), and last year this was 10.4%- an increase of nearly 90%. At the same time, for these MNCs, sales to China increased by 88%- almost an exact correlation- as noted in the table. So at an important level, MNCs sales to China have increased less because they are gaining market share, and more to the fact that China has grown so fast.

Figure 1: Importance of China to Western MNCs- an Overview

Source: Company Info, Secondary Sources, GCiS *Nominal

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Security Systems in China – Demand Trends among Different End-User Industries

This article is based on a GCiS multi-client report: China Video Surveillance System Market Research Report.

In the world’s most populous and fourth largest country, security systems are expected to play a major role in both general “urban security” as well as corporate and personal security. The current China market for security systems is growing at an impressive rate of 25% according to a recent report published by GCiS China Strategic Research.

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Green and Eco Friendly Materials Are the Latest Spotlight in China’s Construction Market

The 6th China International New Wall-Building Materials, Equipment and Technology exhibition opened at the Beijing China International Exhibition Center on May 10th. The show was attended by a total of more than 200 exhibitors from both China and abroad, showcasing fly ash and coal ballast brick-making technology and equipment which utilizes construction waste and other materials sources, as well as other mixers, hauling and packaging equipment. At the show, products that met new regulations regarding energy and land, environmental protection, waste, thermal insulation industrial policy, fire resistance, lightweight requirements etc were popular, but especially “hot” were the new wall building materials.

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Submersible Pumps in China

This article is based on a GCiS multi-client report: China Submersible Pumps Market Research Report.

China's submersible pumps industry is seeing strong domestic support from the municipal, construction and mining sectors. With ongoing commercial and residential development in addition to the modernization of tier 2 and 3 cities, municipal purchases especially are driving the industry. The market is fairly concentrated and competition is strong, especially in the low end of the market. High quality foreign imports represent around 5% of the market, while exports count for around 25%. Top quality products are seeing threats from illegal counterfiets, protection of IP still seen as a significant problem for foreign players to overcome.

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