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Future of China

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Future of China
The Future for MNCs in China
A KPMG Study

kpmg.com/cn

In partnership with

Contents
Introduction The Big Picture: What is next for China and the world’s multinationals? Business Challenges: The end of ‘cheap China’? Rising Consumption: China’s middle class - myth or reality? Regulatory Challenges: A harder place to do business? Regional Differences: There is more than one China The Future: Looking forward to the next decade KPMG Insights: Adapting Strategies for the China Market About KPMG About Silk Road Associates Contact us Case studies Asahi Avery Dennison Bluebell FedEx Genpact Honeywell Jebsen JLL KPMG Maersk OMM Tesco The Executive Centre 41 42 1 3 9 15 21 27 33 37

© 2012 KPMG Advisory (China) Limited, a wholly foreign owned enterprise in China and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

© 2012 KPMG Advisory (China) Limited, a wholly foreign owned enterprise in China and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

1 | The Future for MNCs in China

China continues to attract the world’s top multinationals seeking to establish a presence and expand their footprint in the world’s second largest economy. Multinationals will continue to play an important role but China has evolved quickly, as have Chinese homegrown businesses. Opportunities abound however, as the CEOs we spoke to point out, it is increasingly important to be flexible in this market and prepared to adapt. It is a competitive environment and Chinese domestic players are now raising the stakes, with global aspirations for their own brands. In terms of the changes that we see taking place, as multinationals move further inland to the tier 3 and tier 4 cities, they face new challenges and may need to consider their investment

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