Manufacturers missing out in China

There are few things worse than a missed opportunity.

That’s because once an opportunity is missed, you rarely get a second chance to take advantage of it.

A recent report from Statistics Canada suggests that while Canadian exports are continuing to penetrate the white-hot market in China, there are some troubling indications that Canadian manufacturers still aren’t taking full advantage of the opportunities that are available in China.

The report entitled, "Feeding the Dragon : Canadian Exporters and a Booming China” examines China’s principal imports from Canada between 1998 and 2004.

According to the report, between 1998 and 2004, Canadian exports to China more than tripled to more than $7 billion (U.S.), with annual growth since 1998 averaging 21%.

As a result, China has become the fourth largest market for Canadian exports behind the United States, Japan and the United Kingdom.

"Given that Canada’s exports to the world (in U.S. dollars) grew by less than 7% a year on average over the same period, China has emerged as an important source of growth for Canadian exporters.

"In 2004, Canada was China’s 16th largest source of imports; still, it accounted for only 1.3% of the Chinese import market,” the report says.

However, a closer look at the figures show that Canadian businesses have achieved strong sales growth in areas such as natural resources rather than value added manufactured products.

"Since most Canadian firms do not specialize in manufacturing machinery or the kinds of components that Chinese factories assemble into finished products, they haven’t been significant sources of Chinese imports from Canada.

"The leading sources of growth in Chinese imports from Canada have been crude materials, where growth was driven by rising sales of wood pulp, metals and fertilizer.

"Chinese imports of Canadian crude materials have more than tripled since 1998, accounting for nearly one-third of total growth in Canadian exports,” the report notes.

Instead, the report states that Southeast Asian countries including Malaysia, Singapore and Thailand are taking advantage of the explosive growth in Chinese machinery and equipment imports.

"These countries have taken advantage of growth in Chinese machinery and equipment which are an integral part of China’s rise as a global manufacturing center.

"As a result of its lower labour costs, China has become an important part of global manufacturing supply chains, importing components which are then assembled into finished products for export.

"Imports of machinery and equipment have accounted for nearly half of the rise in Chinese imports since 1998. This category would include imported electrical components that are later assembled into finished products in Chinese factories, as well as the machines needed to run the factories themselves,” the report states.

For example, the report notes that in the area of machinery and transportation equipment Chinese imports from Canada fell to $1.3 billion (U.S.) in 2004 from approximately $1.5 billion (U.S.) in 2001.

Opportunities for new business in new, growing markets don’t come along every day and shouldn’t be passed by when they do.

Jerry Cook
Editor, MPP
jcook@clbmedia.ca 

CMM holds seminar series

Canadian Measurement-Metrology Inc., Mississauga, ON is holding a “Dine & Learn” Knowledge & Techology Tour on April 5 at the Airport Hilton, Dorval, QC.

The event includes breakfast, lunch, or dinner seminars and hands-on product demonstrations. Sessions run all day from 8 a.m. to 7 p.m. Session times are: Session A (Breakfast) 8 a.m. to 10:30 a.m.; Session B (Lunch) 11 a.m. to 2 p.m.; and Session C (Dinner) 4:30 p.m. to 7 p.m.

The seminars include: “REVO CMM Probing for the 21st Century” presented by Renishaw Canada; “Multi Sensor Measurement” presented by Optical Gaging Products; and “Laser Scanning” presented by InnovMETRICS.

To reserve your attendance email jlappin@cmmxyz.com or visit www.cmmxyz.com

Automotive Parts Manufacturers Association of Canada - This site is an information resource for Canadian OEM producers of parts, equipment, tools, supplies and services to the automotive industry. www.apma.ca

Canadian Machine Tool Distributors Association - A resource for Canadian machine tool distributors. www.cmtda.com

Canadian Welding Association - Information resource for the Canadian welding industry. www.cwa-acs.org

Miller Electric Manufacturing Company - The new web site offers information and resources on welding for end users and business owners. www.MillerWelds.com/Results

Wilson Tool International - New e-Business Center offers online tool orders, quotes, invoices, special tool drawings, and shipment tracking for fabricators. www.wilsontool.com