China’s exporters turn to green production, Made in Vietnam to attract new orders at Canton Fair
2023.05.10 04:00Low-carbon production and factories in Southeast Asia have become fresh tools for Chinese exporters in traditional sectors to seek new orders from Western countries, with around 500,000 green and environmentally friendly products on show at a recently concluded key trade fair.Organisers said US$21.7 billion worth of orders were placed during the spring session of the Canton Fair, which concluded on Friday in the southern manufacturing hub of Guangzhou.It was the first on-site trade event after China’s border reopening, and while the number of Western importers was down amid a weakening outlook for its exports, green and environmentally friendly products featured amid Beijing’s push to reach peak carbon emissions by 2030 and carbon neutrality by 2060.“We have already signed orders worth US$500,000 at the Canton Fair, and all of them are from Europe and the US as they attach great importance to recycling and green growth,” said Luke Hu, who runs Ningbo Vontone Stationery.
Low-carbon production and factories in Southeast Asia have become fresh tools for Chinese exporters in traditional sectors to seek new orders from Western countries, with around 500,000 green and environmentally friendly products on show at a recently concluded key trade fair.
Organisers said US$21.7 billion worth of orders were placed during the spring session of the Canton Fair, which concluded on Friday in the southern manufacturing hub of Guangzhou.
It was the first on-site trade event after China’s border reopening, and while the number of Western importers was down amid a weakening outlook for its exports, green and environmentally friendly products featured amid Beijing’s push to reach peak carbon emissions by 2030 and carbon neutrality by 2060.
“We have already signed orders worth US$500,000 at the Canton Fair, and all of them are from Europe and the US as they attach great importance to recycling and green growth,” said Luke Hu, who runs Ningbo Vontone Stationery.
“Last year we imported 200 tonnes of recycled plastic waste from the ocean. And I think we will buy up to 10,000 tonnes on average in the coming two to three years,” added Hu, who is also the authorised distributor in the Greater China region for Plastic Bank, a Vancouver-based for-profit social enterprise.
In total, 2.9 million people attended the latest session of China’s largest trade fair, including 129,006 overseas buyers, according to organisers. During the spring session of the 2019 Canton Fair, transactions hit US$29.3 billion, with 186,000 overseas buyers.
“The attendance of overseas purchasers has not fully recovered, but they were ready to place orders and they ordered more quickly. Many importers also made plans for field trips to factories, hoping for more cooperation onwards,” said Canton Fair organisers
In recent years, China has invested heavily in renewable materials to facilitate its green transition and fuel its economic growth after President Xi Jinping announced the dual-carbon goals in 2020.
“The future is decarbonisation, as we’ve been told by European clients,” said Ray Zhang, a sales manager at Shanghai Newest Luggage.
“And that is one way that we can continue to dominate the market, even though orders have slowly moved to Southeast Asia.”
Many multinational companies have accelerated the deployment of “China plus one” and “in China, for China” strategies, by diversifying their investments to other regions, including Southeast Asia.
China’s Canton Fair is back in person, but developed-market buyers at a premium
Eden Ling, exhibitor and senior overseas sales manager with Hecheng Enterprises, displayed signs on her booth at the Canton Fair featuring “Factory in Vietnam” and “Factory for sustainable bags” slogans.
“Some European buyers, such as in Poland and the Netherlands, expressed great interest in our Vietnam factory because they also hope to diversify their procurement destinations,” said Ling, who was disappointed by the lack of American clients at the fair.
After three years of being held online during the coronavirus pandemic, the biannual Canton Fair – also known as the China Import and Export Fair – returned with in-person exhibitions and exchanges, and the government had predicted more than 100,000 buyers from over 200 countries would attend the event in the southern city of Guangzhou in person.
US multinational retail giant Walmart attended the fair, along with French retailer Auchan, German discount retail chain Lidl and the Abu Dhabi-headquartered supermarket chain Lulu.
In April, as China’s exports rose by 8.5 per cent compared with a year earlier, shipments to the United States fell by 6.5 per cent last month, year on year.
Footwear producer Xu Huifang, though, is concerned about losing orders to domestic rivals who have already set up factories in Southeast Asia.
“Many of our peers have decorated various billboards this year, promoting their manufacturing bases in Southeast Asia, from Cambodia, Bangladesh and Vietnam, which made small- and medium-sized exporters like us who do not have overseas factories feel overshadowed,” said Xu.
Apart from the need to hedge against geopolitical complications and ideological conflicts, green production and green consumption have also affected strategies employed by exporters.
“Besides highlighting the Vietnam factory, we also focus on the concept of renewable products. Our bags are all renewable from the fabric, to the zips and the cartons. This ability is especially important for the European buyers because the younger generation of consumers care about it alot,” Ling added.
“Currently, all of our renewable raw materials are re-exported from China to Vietnam, where they are then processed into finished products.
“In Vietnam and many factories in Southeast Asia, they are currently unable to produce sustainable materials.”
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