Global Standards Set for FirmsChinese companies could better survive worldwide competition following China's impending entry into the World Trade Organization (WTO) by ensuring their products meet global standards, Chinese and foreign business leaders agreed recently."China will experience more competition with its expected accession to WTO and that will mean all Chinese enterprises will be forced to upgrade," said Wang Linxiang, chairman of the board of China's Erdos Cashmere Group. Patrick Noual, vice-president of the France-based Societe Generale de Surveillance, agreed that China's lack of standards is a major obstacle to Chinese companies' competitiveness. As compared to approximately 180,000 technical standards in Europe, China has only two: ISO9000 and ISO14000, he said. He warned that these are not sufficient and that Chinese companies need to become aware of standards in the global arena to improve their reputations abroad. While noting that many Chinese enterprises will focus their attentions on their huge domestic markets instead of venturing into the international market place for some time to come, the president of the Beijing Stone Group Co, Yang Hongru, said even on the domestic front these companies still should pursue international standards in order to be competitive. "Only companies that have reached global standards will be qualified to compete and co-operate with their overseas counterparts," he said. He stressed that higher quality products, financial systems that operate in accordance with international practices and a corporate culture open to outside influences are key ingredients to competitive success. Despite the importance and urgency of meeting global standards, however, Chinese companies still have a long way to go, said entrepreneur Liu Yonghao, chairman of China's leading private company, the New Hope Group. He said Chinese companies lag behind multinational corporations in their financial capacities, managements, their overseas market presence, and in technologies and human resources. But in the view of this private business leader, credibility is one of the biggest barriers that Chinese enterprises need to overcome to meet global standards. Liu showed his strong commitment to improving the reputations and credibility of Chinese private companies by joining 40 other private entrepreneurs in a consortium that called for improved credibility in May last year. Despite the great difficulty, Yang said he is confident that a large number of Chinese enterprises will meet global standards after China's accession to the WTO. But he insisted that Chinese products should seek acknowledgement of international standards organizations after having achieved good reputations and high market share within China. "Chinese companies have to improve their competitiveness step by step," he said. |
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