Fair sees nearly 11 percent slump in deals

Foreign customers place orders at this year's fall session of the Canton Fair in Guangzhou, Guangdong province. The event is considered a barometer of the country's foreign trade conditions. The number of overseas buyers to this session dropped by 6.5 percent from the spring session. Lu Hanxin / Xinhua

Overseas demand for Chinese goods has yet to fully recover after a dramatic decline in transactions during the fall session of China's largest trade fair, organizers said on Monday.

The China Import and Export Fair, widely known as the Canton Fair, saw the value of transactions drop 10.9 percent from the previous event to 194.6 billion yuan ($31.7 billion) because of lower global market demand, industrial competition and trade friction, said Liu Jianjun, spokesman for the fair.

The number of overseas buyers also dropped by 6.5 percent from the previous spring session to 189,646, Liu said

"In particular, demand for Chinese goods, especially from the traditional market, is still low," said Liu.

Transactions with buyers from the European Union dropped 8.3 percent, indicating that uncertain financial conditions there will continue to affect Chinese exporters' business in the near future, according to Liu.

The fall session of the twice- yearly fair ended Monday in Guangzhou, capital of Guangdong province.

Meanwhile, demand from emerging markets also dropped, with transactions with buyers from BRICS members Brazil, Russia, India and South Africa dropping 17.2 percent from the previous session, organizers said.

Liu, also deputy director-general of the China Foreign Trade Center, urged Chinese manufacturers to attach more importance to building their brands.

"Booming manufacturing business in neighboring countries and regions, thanks to relatively lower costs in raw materials and labor, has affected China's trade," said Liu.

As a result, Chinese companies should take bolder initiatives to upgrade their businesses, he said.

"China's foreign trade should no longer rely on labor-intensive manufacturing, given that the country has lost its advantages in production and labor costs."

To help Chinese companies add value to their products, the fair's organizers introduced a design award, an important measure in carrying out the national strategy of innovation-driven development.

Transactions in the brand exhibition zone contributed a higher percentage to the total turnover during the fair's fall session, according to Liu.

"A growing number of Chinese enterprises have realized the importance of developing core competitiveness by investing more in technology, brand-building, quality and service," said Liu.

Chen Yanjun, a sales manager with Xiamen Comfort Science & Technology Group, said investing in research and design helped secure more orders from overseas buyers for the company.

"We also opened design centers in Japan and Canada, which help us catch up with the overseas market trend," Chen told China Daily.

The Fujian-based company, which specializes in making and selling healthcare and message facilities, invests annually up to 80 million yuan to upgrade its products, according to Chen.

The company, which had focused on equipment manufacturing, now attaches more importance to brand building.

"We have opened more than 300 flagship stores in many countries and regions. For example, the sales of products with our self-owned brand in the United States reached more than $10 million," Chen said.

Liu Jie, president of SKG Electric Co, said a new development pattern, which focuses on research, design and brand building, helped the company secure more overseas orders, although global demand remains relatively low.

The company, which started in 2007 in Foshan, Guangdong province, focuses on home appliances.

"We have also opened manufacturing facilities overseas," said Liu, adding that up to 95 percent of the company's self-branded products are sold online.