More than 2,000 years ago, invading tribes from the north were repulsed by the 1,500-mile Great Wall, built by vassal states of the Qin Dynasty to protect the fertile lands of China.
At the beginning of the 21st century, the walls that separate the Chinese economy from the rest of the world are poised to fall a notch with China's re-entry into the World Trade Organisation. That opening, which could come as early as the end of this year and will mean the lifting of tariffs and trade barriers, has many US e-businesses hoping to use the Internet to tap into vast new markets and to link to new business partners.
But, like the invaders that went before them, foreign e-businesses face a number of daunting barriers as they prepare to launch e-commerce in China. Networks and other critical pieces of IT infrastructure still have holes. Government regulations can be a nightmare. And cultural differences make concepts such as business-to-business auctions and online procurement difficult to grasp for many Chinese managers.
Still, many US enterprises are beginning to lay the groundwork to launch B2B e-commerce initiatives in China. Companies such as United Parcel Service of America Inc. and Sina.com are finding e-business partners in China, familiarizing themselves with Chinese laws and B2B cultural conventions, and even beginning to roll out online services targeted at Chinese business partners. Given the huge potential market in China, investing in such first-step efforts makes sense, experts say. But, they warn, have patience. US companies shouldn't expect big B2B e-commerce returns from China overnight.
"China has the biggest B2B economy in Asia," said Paul Cheung, senior vice president of technology for telecom services provider Pacific Century CyberWorks. "Its strong manufacturing base combined with WTO accession will make it a major e-commerce market. But don't be greedy. You cannot expect to see immediate results."
Indeed, the billions of dollars in untapped potential e-business have US companies salivating over China as the next B2B mecca. And it's no wonder. With one-fifth of the world's population, China last year generated US$474.3 billion in foreign trade, according to the WTO. eMarketer estimates B2B e-commerce revenues in China will grow from $1.5 billion this year to $21.8 billion by 2004.
"Certainly, the WTO will open China's market ... in a way they've never been open before," said Joseph Borich, executive director of the Washington State China Relations Council, which has 200 members, including Boeing and Microsoft. "The government has begun to eliminate quotas they've had on imports, and of course, once they join, the tariff rates will come down substantially."
 | |
| |
| |
|
1. Intro 2. First in the door 3. Leery of government interference 4. For B2B, Find a partner 5. Laying the groundwork for B2B | |
| |
| |
