Doing business in China

Key industries

Manufacturing

China is one of the world’s largest manufacturers of everything from clothing and furniture to machinery and steel. In fact, 6 of the top 10 steel companies in the world are in China.

China is currently the biggest steel producing country in the world, accounting for 54% of worldwide steel production in 2022.

Automotive

China is the world’s 3^rd largest car manufacturer and makes a significant number of parts for the automotive industry. Today, one in three cars sold in China is an electric vehicle, and in 2023, almost 20% of electric vehicles sold in Europe were made in China.

As of 2024, Chinese mainland is the world’s largest automobile market in terms of sales and ownership.

The Chinese government has spent around $60 billion on electric vehicles over the last 10 years.

Mining

China’s is the world’s leading producer of more than 20 metals including aluminium, gold, coal, iron, magnesium and rare earth minerals.

Approach to business (things to keep in mind)

• Establishing a clear hierarchy is very important. A senior colleague should begin proceedings with your new Chinese partners to build trust. You should always shake hands with the most senior person first and respect the hierarchy in terms of the seating arrangement in a meeting.
• Chinese observe the Lunar calendar as well as the Gregorian calendar and a lot of their main holidays are important dates on the Lunar calendar. The most important holiday is Chinese New Year, which falls between the end of January and the middle of February each year. Often people take annual leave for a week during this time. Do your research as you don’t want to try to schedule in a meeting during a Chinese holiday as you’ll look unprepared.
• It’s important to build strong relationships over time rather than trying to get a deal done quickly. Make sure you visit your colleagues in China regularly to show it’s a long-term commitment.
• Saving face is an important part of Chinese culture. You shouldn’t ever ask your Chinese counterparts abrupt questions or answer their questions abruptly. Say you’ll think about an idea rather than saying no outright.
• Although gift giving is a big part of Chinese culture, please check before gift giving in a business context. If you want to give a gift to an individual on a friendship level, avoid chrysanthemums, clocks and anything sharp such as scissors because they symbolise bad luck.

Dos and Don’ts in a business meeting

Do…

• …have your business cards translated into Chinese with one side in English and the other in Chinese. You will also be expected to have any PowerPoint presentations or handouts translated into Chinese.
• …when exchanging business cards, hand yours over with both hands with the Chinese side facing up. Always take your Chinese colleague’s card with both hands.
• …arrive to meetings early as they will almost always start exactly on time.
• …consider hiring an interpreter to accompany you if you don’t speak Chinese. It’ll make the negotiations run much smoother as nothing will be ambiguous.

Don’t…

• …interrupt if there’s a moment of silence. Let the host break the silence.
• …point. It’s considered a rude gesture. Keep hand gestures to a minimum in presentations and meetings.
• … forget to adhere to Chinese dining etiquette. Since 2013, there has been a movement in China called “Clean Your Plate Campaign” which calls for a reduction in food waste and aims to ensure food security. This is seen in many restaurants and encourages people to save food. In the past it has been the practice to never finish your meal entirely unless you want more food, but this is not the case nowadays. You should also be aware of chopstick etiquette.

Conversation topics

Small talk usually starts with “Have you eaten yet?” amongst Chinese people. Food is a very important topic of conversation in China. In business settings however, you can talk about the weather to break the ice, just like in the UK. You can also get to know your Chinese business associates by asking about their hometowns or travel plans, or simply how they are doing.