WREAC partner, the Centre for International Business at the University of Leeds (CIBUL), in collaboration with the China-Britain Business Council (CBBC), conducted the research project "Second tier cities in China - What are the opportunities for British business" commissioned by UK Trade & Investment.
China's 1st tier cities such as Beijing, Guangzhou, Shanghai, and Shenzhen have received considerable media and academic interest over recent years. British firms are therefore well aware of these cities when it comes to establishing business links with mainland China. However, a growing number of so-called 2nd tier cities may provide equally attractive business opportunities for British firms considering investing in, sourcing from, or exporting to China. This research assesses the strengths of thirty-five cities in comparison to the benchmark city Shanghai. The research results obtained shall support British businesses in making an informed decision when considering conducting business in and with China for the first time, or when they are evaluating expansion within the Chinese market.
Of the 274 municipalities in China with a population in excess of one million, 35 were identified by this study as being ‘regional' cities on the basis of their economic size, economic growth rate and population. These cities were then ranked and grouped on the basis of a number of indices calculated using data published by China's National Statistics Bureau, the World Bank and other sources. These rankings and groupings capture the relative attractiveness of the short-listed cities as business locations for UK companies in terms of the general business environment they offer, an their attractiveness for four different types of business activities, namely local sales, production to supply domestic markets, production to supply export markets, and research and development activity. A further set of groups was devised to provide an indication of the opportunities presented by each regional city in each priority sector. Finally, an overall city-attractiveness index was calculated.
To augment the quantitative analysis, the research team also collected primary data using an online questionnaire survey (completed by more than 80 companies) and through more |than 60 interviews conducted with UK and international companies and trade promotion organisations (TPOs) with extensive experience of operating in China. The key findings of this research are as follows:
Roadshows were also held in the UK and China to disseminate the research findings and inform British businesses. The CIBUL research team comprised Peter J. Buckley, Jeremy Clegg, Adam R. Cross and Hinrich Voss, postdoctoral Research Fellow at WREAC/NICS. Contact person for further information is Peter J. Buckley.