Hainan Expo opens, displaying consumption dynamic of China

Hainan, a tropical island in South China, has come under the limelight once again, especially in terms of consumption upgrade momentum.

On Monday, the third China International Consumer Products Expo (CICPE), Asia's largest premium consumer products expo, kicked off in Hainan's capital city of Haikou, marking the beginning of a slew of trade expos this year that dovetail with China's unswerving commitment to opening-up.

Across the exhibition hall, there's a palpable sense of "heat" everywhere, from the bustling booths that display French, Italian and other European luxury cars and yachts, watches, exquisite jewelry and the high-tech gadgets exhibited by US enterprises that have taken the limelight, to the flocks of consumers trying out honey, cubilose, and healthcare products presented in the pavilions of Southeast Asian economies. All of these, observers said, demonstrate the vigor of China's domestic consumption, as well as its accelerating upgrading trend.

The sizzling vibe is equally visible with foreign exhibitors, with many treasuring the expo as an opportunity to deepen their footprints in one of the world's largest consumer markets. At a time when the world is being fraught with a US-led decoupling push and geopolitical tensions, representatives of leading multinationals told the Global Times that they're increasingly pinning their hopes on the Chinese market, which is set to drive their revenue growth and instill new positivity into a gloomy global economy.

This year, CICPE has set up an exhibition area of 120,000 square meters, 20 percent more than last year. The six-day expo has attracted more than 3,100 brands from over 60 countries and regions, with over 300 brands debuting new products. The expo is expected to attract over 50,000 purchasers and 300,000 visitors.

"China has been sharing its market opportunities with the world, and the role played by China's consumption in driving the global economy has become increasingly evident," Chinese Vice Premier He Lifeng said in a video speech to the opening ceremony of the third CICPE on Monday.

He stressed that China remains committed to expanding high-level opening-up, and facilitating the economic globalization moving toward a more open, inclusive, beneficial, balanced and win-win direction. During the speech, he also extended an olive branch to multinational companies, encouraging them to scale up investment in China and grow together with the Chinese economy.

Premium, high-quality product line-up

The Hainan expo is the first important international exhibition China has held since the COVID situation eased, and will be followed by a slew of expos, including the Canton Fair in South China's Guangdong Province later this week.

It is also being held on the fifth anniversary of the construction of the Hainan Free Trade Port, where the convergence of domestic and international circulation is poised to release more consumption potential.

Chinese Commerce Minister Wang Wentao said in a speech delivered at the opening ceremony that the consumer expo this year featured factors such as "a more prominent international position and more focus on consumption forces."

Among the vibrant foreign participants are an array of European premium brands, some of whom have joined the exhibition for the third consecutive year, such as French luxury group Kering, France-based beauty and cosmetics giant L'Oréal, Switzerland-based luxury groups Richemont and Swatch, and British luxury brand Burberry.

Fabrice Megarbane, President of L'Oréal North Asia Zone and CEO of L'Oréal China, told the Global Times that platforms like CICPE have become symbols of joint cooperation between China and the rest of the world.

Business France, a trade facilitator for French business, has set up a France national pavilion for the third time this year, aimed at showcasing "French lifestyle" in fashion, beauty and fine food.

Jerome Cottin-Bizonne, Managing Director of French wine and spirits group Pernod Ricard's China group, told the Global Times on the sidelines of the expo that Chinese consumers are still exploring more product categories and looking for diversified offers, which is a great opportunity for the company.

Italy, the guest of honor country at the third CICPE, has teamed up with Italian luxury industry association Altagamma Foundation, and brought 147 brands in sectors such as jewelry, clothes, glasses, motorbike and wine to the expo. Those companies together occupy an area of 1,800 square meters, double last year's.

A dozen of companies or so from the US are also showing great enthusiasm for the event, despite Washington seeking a full-fledged supply chain decoupling with China.

US automaker Tesla said in a statement sent to the Global Times the firm will woo consumers with an array of advanced tech products including humanoid robot Tesla Bot. Tesla and US tech firm Dell are both third time exhibitors at the expo. US fashion brand Coach, which is owned by US retailer Tapestry, also drew attention at the expo with its "pinky romantic pavilion," which some consumers said brought a sense of freshness.

"It is worth noting that despite the rise of global trade protectionism and supply chain snags, foreign companies have shown an unprecedented enthusiasm [for the expo]," Xue Yingjie, the chairman of Greenland Global Commodity Trading Hub Group, a Shanghai-based trade facilitating company, told the Global Times on Monday.

Hope for business growth

Observers said that with the Chinese economy seeing a faster-than-expected recovery and a slew of policies set to shore up domestic consumption, its huge 1.4 billion-strong consumer market could become "the only silver lining of hope" for a raft of foreign brands.

"Every year, we see that the number, quality, fields, and form of new products released at the expo are increasing compared with the previous one. This is a full manifestation of the CICPE's role in leading new global consumption, as well as a microcosm of the huge attractiveness of the Chinese market," Yu Jinli, who is in charge of corporate promotion for Shiseido, told the Global Times.

Yu said that China's consumer market is constantly improving and expanding. At the same time, this year's Government Work Report delivered at the two sessions gave priority to the recovery and expansion of consumption. These have brought more diverse and high-quality development opportunities for beauty and daily necessities enterprises.

China has become the fastest-growing market for international brands in the auto, beauty, leather goods, clothing and jewelry sectors, according to Vice Premier He Lifeng.

"The biggest dynamic factor in the global economy at present is the Chinese market in the post-pandemic era. It can be said that the most anticipated market opportunity for global enterprises is the effect of China's opening-up efforts. Korean companies are also full of expectations for this," Joocheol Kim, director general of the Korea Trade-Investment Promotion Agency Guangzhou Office, told the Global Times on Monday.

Josie Zhang, President of Burberry China, told the Global Times that many firms have used the expo as a platform to introduce China-first or China-exclusive products.

"China's expanding consumer market is one of the world's most important and remains highly dynamic. [It] continues to provide the world an opportunity to share the potential and opportunities of the China market and will play a meaningful role in driving the recovery and growth of the world economy," Zhang said.

UBS expects China's household consumption growth to jump to 10-11 percent in nominal terms and 7.8 percent in real terms in 2023. IMF said in March that the robust rebound means China will account for around one third of global growth in 2023 - giving a welcome lift to the world economy.

Global executives told the Global Times that they are particularly inspired by Chinese officials' clear blueprint chartering the world's second-largest economy into more openness. They also expressed eagerness to not only remain committed, but also to further scale up investment that aligns with the country's development priorities.

Zhang Xiqiang, Chairman and CEO of Nestlé Zone Greater China, told the Global Times that China's steadfast push for high-level opening-up has provided foreign companies with both convenience and assurance on two-way communication and win-win cooperation. Zhang Xiqiang said that the company will bring more innovative and healthy products into China, which is line with the country's focus on low-carbon, green consumption.