Page images
[blocks in formation]

China National Native Produce and Animal By-Products Import and Export Corporation

82 Tung An Men Street

Peking, People's Republic of China
Telex: 22083 TUHSU CN PEKING

Tea, coffee, cocoa, tobacco and cigarettes, fibers (hemp, ramie, jute, sisal, flax, etc.), rosin, manioc, starches, and seeds, cotton linters and waste, timber, certain papers and forest products, waxes, spices, essential oils, aromatic chemicals, nuts, dried fruits and vegetables (see also CEROIL FOOD), patent medicines and medicinal herbs, fireworks, nursery stock as well as other native produce, including bristles and brushes, horsetails, feathers, down and down products, feathers for decorative use, rabbit hair, goat hair, wool, cashmere, camel hair, casings, hides, leathers, fur mattress, fur products, carpets, living animals.

China National Technical Import Corpora


Erh Li Kou, Hsi Chiao
Peking, People's Republic of China
Telex: 22044 CNTIC CN PEKING
Importation of complete plants and tech-


China National Textiles Import and Export

82 Tung An Men Street

Peking, People's Republic of China
Telex: 22080 CNTEX CN PEKING

[merged small][ocr errors][merged small][merged small]

Am I prepared to invest considerable money initially without assurance of an early return?

Am I prepared to negotiate the first transaction for 1 or 2 years?

Am I prepared to obligate the necessary senior talent and technical expertise?

Am I prepared to walk away from an unpromising negotiation at any time?

Am I prepared to resist concessionary terms in order to penetrate this market?

If some of your answers to these questions are negative, you may want to rethink entering this market.

Generally, the first step in establishing commercial contact, regardless of whether exports or imports are involved, is to determine which of the above FTCs has jurisdiction over the commodities of interest to you. A proposal is then prepared and sent to Peking. A successful sales proposal is likely to result in a request from the Chinese for additional information and specificity, a reworking of the proposal based on specifications provided by the Chinese, or by an invitation to come to Peking and discuss the matter further. If you are buying Chinese goods, you would normally hope to receive an invitation to attend the Chinese Export Commodities Fair in Kwangchow; you may wish to request an invitation in the proposal. Sales of some commodities, of course, are done directly by mail, without the need for direct contact. In a few cases, where the Chinese have a requirement for a commodity, they may contact the American firm directly.

The form of the initial proposal is important, even though the ultimate FTC decision to purchase a commodity rests on the plan

requirements of the Chinese economy. The sales proposal should clearly define the products or product lines you wish the Chinese to focus on. Too often, especially with multi-division corporations or with conglomerates, confusion is created by sending the FTC annual reports or other brochure material describing all product lines. The proposal should be straightforward and sufficiently explicit and technically comprehensive to permit an in-depth evaluation by the Chinese of the products in question. The balance of the material in the proposal, designed to acquaint the FTC with your corporation and other products, may be included, but should be clearly distinguishable from the commodities you hope to sell.

The FTC is the go-between you and the Chinese end-users. For this reason, it is essential to provide at least 10 and preferably 20 copies of the pertinent technical information to be forwarded to the end-users by the FTC. In the case of Techimport, five copies should suffice. If the product lines you wish to sell are in different FTCs, it would be best to prepare separate proposals. Firms should always include the words "United States" or "U.S.A." in their company's address. A firm whose name and location are quite well-known in the United States may be totally unfamiliar to the Chinese and cannot be readily identified with the United States. Copies of the information, or at least the covering letter should be

sent to:

Commercial Office

Liaison Office of the People's Republic of China

2300 Connecticut Avenue, N.W. Washington, D.C. 20008, and

Commercial Officer

Liaison Office of the United States of America

17 Kuanghua Lu

Peking, People's Republic of China

It would also be useful to send several copies of the pertinent technical information to:

The China Center for Literature
Concerning New Foreign Products
P. O. Box 615

Peking, People's Republic of China

Depending on the products involved, especially in the case of high-cost capital equipment or complete plant, you may wish to invite the FTC to send a technical team to the

United States to inspect your plant and equipment or visit similar facilities.

It is always a question whether or not to put the proposal in Chinese. Of course, this is the courteous thing to do and it may facilitate the handling of your proposal in the PRC. On the other hand, the number of adequate translation services in the United States which are familiar with the simplified characters in use in China is very limited. If your proposal covers products for which it is unclear the Chinese have a need, it may be quite wasteful to have a lengthy proposal translated although it is likely a translation is helpful to the Chinese. If in doubt, transiation of the covering letter could serve to show your interest. Any proposal in Chinese should be accompanied by an English translation.

In your proposal do not overstress past relationships with China. The PRC is more interested in current performance than in any past connections, either to 1949 or since then with Taiwan. Naturally words such as Red China and other offensive terms should be avoided. Refer to the People's Republic of China or China.

If the Chinese are interested in a proposal, they can be expected to reply. However, it takes considerable time- often months-for a proposal to be processed and assessed. There may be no reply at all, probably indicating no requirement for such commodities at the time (Appendix 2 contains a list of commodities thought to be of interest to the Chinese). Firms that are convinced their products mesh with Chinese development priorities should keep their products and literature before the appropriate foreign trade officials. Because of mailing and distribution time lags, some 8-12 weeks should be allowed before initiating any follow-up activities. In general, it is advisable to follow up periodically with additional material and samples, especially with regard to any product developments that would enhance the initial approach. Any additional literature or samples should be accompanied by a covering letter that refers to the original proposal.

Samples should be sent to China only after receiving permission in advance from the rele vant foreign trade corporation. Exporters should arrange to send their samples directly to the FTC in Peking or, if directed, to branch offices in other parts of China.

It should be remembered that the FTCs alone are responsible for negotiating contracts. No attempt should be made to circumvent the FTC, but it may be helpful on occasion to visit the Hong Kong agents of the FTCs. The agents can explain the current situation and usually report fully to their principals in Peking. In rare instances they are allowed to conclude trade deals.

In addition to communicating by mail with the FTCs in Peking or by visiting their agents in Hong Kong, there are several other approaches that may be taken. These include: Attendance at the Kwangchow Trade Fair; participation in an exhibition in or trade mission to the PRC; holding technical seminars by invitation; contacting PRC commercial/ technical missions to the United States; utilizing the services of the U.S. and PRC Liaison Offices in the capitals of the two countries; and becoming a member of, or consulting with, the National Council for U.S.-China Trade.

In general, the Chinese prefer to deal with American firms directly, but will not refuse to negotiate through agents of these firms when necessary.

For further information or advice on contacting the Chinese on commercial matters, call or write to:

PRC Affairs Division

Bureau of East-West Trade U.S. Department of Commerce Washington, D.C. 20230

(Telephone (202) 377-3583/4681)

The U.S. and PRC Liaison Offices

Liaison Offices in the respective capitals of both countries opened in May 1973. Both offices contain economic/commercial sections. They provide important points of contact for businessmen of both countries. The PRC's Washington office is the principal contact point in North America for American firms.

While U.S. firms should consider keeping the PRC Liaison Office in Washington informed of their capabilities and desire to do business in China, the basic approach to selling in the PRC remains through the appropriate FTC in Peking. The U.S. Liaison Office in Peking assists Americans by providing advice on the FTCs and by generally apprising U.S. businessmen of the economic situation and commercial opportunities in China.

The National Council for U.S. -China Trade

The formation of a National Council for U.S. China Trade was announced on March 22, 1973. The Council, a prestigious, nonprofit, private organization maintaining close liaison with the U.S. Government, serves as a forum for the discussion of trade policy and issues. It also serves as a focal point for business contacts and the dissemination of information accumulated in marketing in the PRC. The Council maintains a business counseling service, a translation sevice, and it publishes the U.S.-China Business Review bimonthly. The Council facilitates the reciprocal arrangements of trade missions and trade exhibitions in the United States and China.

To promote these activities the Council maintains a working relationship with the Chinese Council for the Promotion of International Trade in Peking and the PRC Liaison Office in Washington. Individuals and firms interested in these activities should consult either the National Council or the Bureau of East-West Trade. The National Council may be reached at Suite 350, 1050 17th Street, N.W., Washington, D.C. 20036 or by phone at (202) 331-0290/0295.

Other PRC Trade-Related Entities

Bank of China (BOC)
San Li Ho

Peking, People's Republic of China
Cable for all branches CHUNGKUO

Handles all of China's external financial dealings; finances the FTCs; and for all intents and purposes acts as the foreign branch of the People's Bank of China, China's national bank. The BOC has branches throughout China and three outside of China (Hong Kong, Singapore and London). It also maintains corresponding banking relationships with scores of foreign banks, of which 30 or so have branches in the United States.

China Council for the Promotion of International Trade (CCPIT)

4 Taiping Chiao Street

Peking, People's Republic of China

Although the CCPIT is said to be a nongovernmental "public" organization, it is an important part of China's foreign trade structure. As such it works with

he Ministry of Foreign Trade and the FTCs on China's external trade and serves as a liaison between China's trade enterprises and their counterparts abroad. Its responsibilities include informing foreign trade organizations of China's trade and keeping abreast of developments in foreign markets; arranging economic and trade-related exchanges, which include Chinese exhibitions abroad as well as foreign exhibitions in the PRC; and registration of trademarks. The CCPIT does make "unofficial" trade agreements with foreign organizations in its own name. Through its Foreign Trade Arbitration Commission and Maritime Arbitration Commission the CCPIT has responsibility for settlement of legal disputes related to foreign trade and maritime affairs.

[blocks in formation]

Peking, People's Republic of China
Telex: WAIYUN PK 335
Telex: ZHONGZU PK 331

Arranges customs clearance and delivery of all import/export cargoes by land, sea, and air, or by post. May act as authorized agents clearing and delivering goods in transit through Chinese ports. Arranges marine and other insurance and institutes claims on behalf of cargo owners on request.

China Ocean Shipping Company

6 Tung Chang An Street
Peking, People's Republic of China
Telex: CPC PK 329

Engages in cargo and passenger services, handles clearing of foreign ships and booking of shipping space and transshipment of cargo.

China National Publications Import Corporation

P. O. Box 88

Peking, People's Republic of China Cable: PUBLIM PEKING

Import of books and periodicals.

Guozi Shudian

P. O. Box 399

Peking, People's Republic of China

Export of China's books and periodicals. Arranges subscriptions to Chinese newpapers and periodicals on behalf of foreign readers.

People's Insurance Company of China
34 Fan Ti Road

Peking, People's Republic of China
Cable: 42001 PEKING
Telex: RENBAO PK 341

Provides international trade and marine risk underwriting at competitive rates. Has overseas agents in leading countries.

Scientific and Technical Association
Kan-mien Hu-t'ung No. 31

Peking, People's Republic of China With the CCPIT, this organization plays a role in and may be consulted in connection with arranging scientific and technical symposia in China. It is responsible for

[blocks in formation]

ucts Import and Export Corp., China National Light Industrial Products Import and Export Corp., and China National Textiles Import and Export Corp.

Ministries, Enterprises, and Other EndUsers.-The FTC's import commodities and technology on behalf of ministries, enterprises, and other consuming entities in the PRC. It would be ideal to reach these end-users since they play a major role in deciding what commodities are to be procured within the constraints of plans and budgets. At least in the initial stages of negotiations, however, it is quite difficult to make such contacts although you may become aware from the types of questions asked that an end-user is present during discussions. In subsequent rounds of negotiations, the presence of end-users may be acknowledged.

One way to contact end-users in an attempt to influence their decisions is by exhibiting equipment in China where engineers and other representatives of consuming entities have an opportunity to observe and ask questions about the equipment being demonstrated. Useful contact with end-users may be made when they visit the United States or third countries as members of trade missions and delegations. In any event, if PRC end-users can be reasonably identified, it may be useful to communicate by letter with them, outlining the technical and economic advantages of given products. It is also possible to get information about your products in front of Chinese end-users by advertising in Chinese in publications about American industrial products that are published by American firms. (See Bibliography)

The Kwangchow Trade Fair

The Chinese Export Commodities Fair (Kwangchow/Canton Trade Fair), sponsored by the foreign trade corporations is held twice a year, in the Spring (April 15-May 15) and Fall (October 15-November 15). While the Fair is heavily export oriented and only Chinese commodities are displayed, the FTCs do purchase foreign products during this semiannual event. Since its inception in 1957 the Fair has grown steadily and in the Spring of 1974 it was moved to a new building complex in the Liu Hua district on the outskirts of Kwangchow. The new exhibition hall is near the new train station serving Hong Kong, Peking, and Shanghai and is a 10 minute walk from the Tung Fang Hotel which accomodates U.S. businessmen. Completion of the new

« PreviousContinue »