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Published on April 17, 2008

Apart from the big cities like Shanghai, Beijing and Shenzhen, the SMEs should penetrate other less competitive areas in the provinces of Fujian and Sichuan, Chongqing Municipality and Guangxi Autonomous Region.

Competition is not as tough there as in the big cities and the people in the four areas located near Thailand are also familiar with Thai products. That makes it easier for Thai SMEs to market their goods in these zones, she said.

One of the more interesting trends that Thai operators should note is the demand for business education in areas such as tourism management, English schooling and skills development.

"Today, the Chinese people have money and they need to improve themselves in a tough competitive environment," Aksornsri said.

Another business with potential is interior decorating and design because of the rapid growth of property construction in these areas.

She said Thai operators should not invest in plants in China because the competition is very high, but they can export some products with potential, particularly plastic pellets, rubber and cassava.

"Demand for these raw materials is high because the automotive industry is growing robustly, particularly in Chongqing and Guangxi," she said.

Thai businesses have the potential to export other products such as processed fruit and frozen seafood to Sichuan and Chongqing because they are land-locked.

Aksornsri suggested local enterprises should seek the right Chinese partners if they want to operate in China because the regulations in each area are quite complicated.

However, she said the Chinese government was more welcoming of imported goods and had reduced import tariffs, particularly for necessary raw materials such as plastic pellets and rubber.

Many leading Thai companies now do business in China like Banpu, Charoen Pokphand, Mitr Phol, Sammitr Motor, Bangkok Bank and Saha Union.

Fujian is located on the coastal part of China and has export potential. The per-capita income is in the top 10 of China's provinces. Its downside is that many investors, particularly Taiwanese, have already established businesses there.

The strong point of Sichuan is a high consumption rate. The retail trade in this province ranks seventh in the country. Conversely, the majority of the population of 80 million are poor and live in country areas with bad road connections and no direct sea access. Sichuan is a potential market for agricultural products, rubber, tapioca, seafood, hotel and tourism management schools, salons and spas.

Thai plastic-pellet makers

have potential to export to Chongqing, which is one of the main production bases for the automotive industry. Unfortunately, Chongqing is primarily an agricultural area, so trading can be done only in the city. The municipality is a potential market for rubber, plastic pellets, hotels and tourism schools, and logistics.

Guangxi is rich in minerals and has major deep-sea ports. It is the gateway to Asean. The weak point of this region is the lack of qualified business people, given that most of the population are farmers. The region is a potential market for agricultural products, rubber, plastic pellets and logistics.

Chalida Ekvitthayavechnukul

The Nation