More than 40 percent of privately owned mainland businesses plan to go overseas in the next three years, according to an HSBC survey.
Of the 902 privately owned companies surveyed by HSBC and Fudan University in Shanghai, 43 percent said they were keen to expand overseas. The respondents are based mainly in the Yangtze River and Pearl River deltas.
Liang Xiaoya, assistant professor at Fudan University's school of management, said around 75 percent of the mainland businesses surveyed are privately owned and the majority had sales revenue of less than 50 million yuan.
"These enterprises have seen rapid growth and extraordinary market opportunities as the mainland economy has developed. Their average annual sales growth over the last three years was 24 percent," Liang said.
She also said privately owned businesses would drive mainland economic growth in the future.
More than half of Dthe respondents are already doing business overseas through exports and joint ventures with foreign partners.
"However, more than 70 percent of these businesses lack experience in international marketing and don't understand the overseas investment environment," Liang said.
Most of the respondents said their primary financing channel was State-owned commercial banks. Only 12 percent of businesses surveyed said they would consider borrowing from foreign banks.
But Liang expects that attitude will change.
"Our respondents showed increasing interest in foreign banks' services such as short-term renminbi loans, hedging and merger and acquisition advisory services," she said.
Source: China Daily