Your key to successful business in China China’s Overview -Year 2005 Starmass International, Beijing, China

Your key to successful business in China Contents Demographical key points Macroeconomic key points Imports and exports Impact on global economy Key drivers for future growth

Your key to successful business in China Demographical Key Points Total population – 1,299,988,000 as at 2004, whereas: - Male: 51.5%; female: 48.5% China’s population reached 1.3 billion on Jan 6, 2005 Total population (in million) Year Remarks: China in this presentation refers to mainland China only, excluding Taiwan, Hong Kong and Macao.

Your key to successful business in China Population by Region Population by province or city (in million, 2002) Hehan is the largest province with population million Shanghai is the largest city with population million

Your key to successful business in China Distribution Map of China Giant City 10 cities with population 4 million and over 23 cities with population 2-4 million 138 cities with population 1-2 million 279 cities with population million 171 cities with population million 39 cities with population under 0.2 million Total 660 cities in China in 2002, whereas: Beijing Shanghai Hong Kong

Your key to successful business in China Industrialization and Urbanization Percentage of urban population: 19.2% in 1978; 40.5% in 2003 Additional %, or million people from rural to urban per year Every two years: an additional Australia

Your key to successful business in China Population by Age Group Aging population, 65 and over in 2003: 7.5% By 2050, the elder (60 and over) will reach 400 million Labor force reached 740 million in 2003; by 2020, will increase to 940 million

Your key to successful business in China Population with Education Attainments Junior colleague and above reached million in 2002, or 5.25% of total population Total 2110 universities & colleagues in China in 2003, total million students whereas: million: bachelor or diploma degree thousand: master degree, and thousand: doctor’s degree

Your key to successful business in China Macroeconomic Key Points GDP reached USD 1414 billion in 2003, GDP PPP estimated at USD 6720 billion Strong economic growth during , average GDP growth 9.4%, 2004: 9% GDP per capita hit USD1095, average growth of GDP per capita 8.1% during China GDP and GDP per capita

Your key to successful business in China GDP by Industries Industrial sector grew faster than GDP, which was high percent of GDP in 2003 at 52.94% Service industry shared 32.5% of GDP in 2003, which was much lower than world average level at 64%, and lower than that of average developing countries at 45% USD, in billion

Your key to successful business in China Economy by Cities with Population > 5m Top three giant cities in terms of economic scale in 2002: - Shanghai: USD billion - Beijing: USD billion - Guangzhou: USD billion

Your key to successful business in China Economy by Cities with Population 1-5m Top three cities in terms of GDP per capita in 2002: - Xiamen: USD 5730 (population1.37 million) - Shenzhen: USD 5576 (population 4.91 million) - Guangzhou: USD 5049 (population 7.21 million)

Your key to successful business in China Imports & Exports Total value of imports in 2004: USD billion; exports: USD billion Total value of imports and exports in 2004 reached USD 1.15 trillion, world’s third largest trading nation after U.S and Germany USD in billion

Your key to successful business in China Imports by Category of Commodities Mechanical and electrical products in 2002: USD billion or 52.7% of total value of imports.

Your key to successful business in China Imports by Main Countries or Region Japan is the largest importing country to China, USD 74.2 billion in 2003 or 17.9% of total imports value Top five importing countries or region to China: Japan, Taiwan, South Korea, U.S & Germany

Your key to successful business in China Exports by Main Countries or Region China largest exporting country - U.S: USD 92.5 billion in 2003, or 21.1% of total value Top five exporting countries or region of China: U.S, Hong Kong, Japan, South Korea, Germany

Your key to successful business in China Total Amount of FDI Actually Used USD, in billion Total amount of FDI actually used in 2004: USD 60.3 billion, increased by 12.7% than that of 2003 Total accumulated amount of FDI actually used as at 2004: USD billion

Your key to successful business in China FDI by Main Countries or Region Hong Kong: largest region investor to China – total actually used FDI as at 2003 accumulated to USD billion or 44.39% of total FDI Top five investors to China: Kong Hong, U.S, Japan, Taiwan and Virgin Island USD, in billion

Your key to successful business in China Foreign Currency Reserves Foreign currency reserves as at 2003: USD billion Foreign currency reserves as at 2004: USD billion, world’s second largest nation in terms of foreign currency reserves after Japan

Your key to successful business in China Impacts on Global Economy China: the sixth largest economic nation in the world in Although China nominal DGP in 2002 was 3.9% of global economy, it contributed to 11.1% of global economy growth, and enjoyed fastest economic growth in the world

Your key to successful business in China Percentage Distribution of Global Output China was once the largest economic nation in earlier19 century, dropped down sharply since 1830, lowest as 2.6% in Percentage was increased to 3.9% in 2002, and it will be 25.6% of global output by 2020, become the world’s second largest economic nation %

Your key to successful business in China China-led Global Linkages Near100% of Taiwan export growth going to China in % of Japan and 41% of South Korea export growth going to China in 2003 China is the main engine to drive Asia economic growth %

Your key to successful business in China Share of US Import Market China’s share of US import market surpassed Japan in 2002 at 11.1% In 2003, China surpassed Mexico and become US second largest importer after Canada %

Your key to successful business in China Share of US, Japan & EU Import Market China surpassed U.S in 2002 and became Japan’s largest importing nation China surpassed Japan in 2003 and became EU’s second largest importing nation after U.S %

Your key to successful business in China Share of ASEAN Import Market Shares of ASEAN import market in 2003: - Indonesia: 5.6%; Malaysia: 6.1%; Philip: 5.9%; Singapore: 6.7%; Thailand: 6.9% %

Your key to successful business in China Key Drivers of Future Growth Autonomous domestic engine of growth: independent of external demand Household, infrastructural development Effect of privatization and urbanization Strong FDI inflows and exports High national saving rate, and high investment rate

Your key to successful business in China Surging Material Demand In 2003, China shares of world economy was 4%, but it consumed 25% of aluminium, 27% of steel, 30% of Iron, 31% of global coal and close to 41% of cement, which certainly drove the growth of relevant industries %

Your key to successful business in China National Saving Rate China enjoys very high national saving rate, 46% in 2003, which means high investment rate in China Since 1990, China maintains national saving rate at about 40%. %

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