MNCs in retail, travel bullish on Chinese market

As China's annual two sessions draw near, multinational retailers in the consumer goods sector and travel operators said they are optimistic about the growth prospects in China this year.

The two sessions, or the annual sittings of China's top legislature and the top political advisory body, are slated for early March. They are key events on China's political calendar as they indicate the direction economic policies will head toward in the months ahead.

Multinational corporations in retail and travel industries said their confidence in China is high as the country had optimized its COVID-19 response measures while consumer demand has been continuously rebounding.

Norwegian-American cruise line operator Royal Caribbean International, which mainly operates large-tonnage cruise ships, said since China eased COVID-19-related entry restrictions on Jan 8, Chinese tourists have shown a strong interest in going on cruise trips abroad, especially in Southeast Asia, going by the high level of bookings made already.

Compared with other regions, international flights that connect China with Southeast Asian countries have shown price advantages, and travel agencies are now allowed to organize group tours to those countries.

Royal Caribbean said it is fully confident in the growth potential of the cruise tourism market in China, and the market is expected to see its recovery accelerate in the second half of this year.

As China continues to build its new development pattern, which takes the domestic market as the mainstay while letting domestic and foreign markets reinforce each other, emphasis has shifted from investment- and export-driven development to consumption-led development.

"China is building a new development pattern and promoting high-quality development, and the country's economic growth shows positive prospects, offering new opportunities for the growth of global companies, especially consumer goods retailers," said Bai Ming, deputy director of international market research at the Chinese Academy of International Trade and Economic Cooperation in Beijing.

"This year, China's market growth potential has been harnessed at an accelerated pace, and foreign companies are actively tapping the market demand and speeding up their investments. This further reflects their confidence to grow their business in China," Bai said.

British-Dutch consumer goods company Unilever is marking the 100th anniversary of its entry into the China market this year. The company plans to continue to increase investments in China.

At Unilever's new, $106 million ice cream plant in Taicang, Jiangsu province, the company has utilized digitalized and smart production techniques and introduced more innovative desserts.

"China has been the largest global market for two kinds of Wall's ice cream. We have expanded e-commerce sales and the delivery business of ice cream and strengthened digitalized marketing in the country," said Benny Xu, North Asia general manager of Unilever ice cream.

Meanwhile, Italian confectionery maker Ferrero said it believes that consumption will continue to be the mainstay of China's economic growth this year. Ferrero data showed the company's sales in China had gradually bounced back since December, and the gap in revenue compared with the same period of the previous year showed a week-on-week narrowing.

"During the Spring Festival holiday this year, we saw a strong momentum of consumption recovery as reflected by our outstanding business performance. The robust spending during the Chinese New Year suggests growth this year will be promising," said Mauro De Felip, general manager of Ferrero China.

"With China's optimized COVID-19 response measures, we are optimistic about China's consumer market and the confectionery industry this year and beyond. Thus, we are more confident about our business growth in China and will further increase investments by developing more portfolios and implementing all-round digitalization strategies to satisfy consumer demand," said De Felip.