Easier financing, visa arrangements attract business to free trade zone

The Shanghai free trade zone is fast becoming a destination of choice for global exhibition companies that are planning expansion in the country, according to a top official.

The easier financing arrangements and visa advantages offered by the FTZ have also made investment in and travel to Shanghai much easier, said Michael Kruppe, general manager of Shanghai New International Expo Center (SNIEC).

"The free trade zone (FTZ) in Shanghai is certainly attracting more companies to Shanghai. Consequently, these companies generate more products and services, which will lead to more shows being held in the SNIEC as the companies need a platform to showcase their market potential," he said.

The SNIEC, a joint venture between Shanghai Lujiazui Exhibition Development Co Ltd and German Exposition Corp, conducts major shows including furniture, bauma China (construction industry trade fair), Ptc Cemat (materials handling and logistics fair), Hotelex (trade fair for the hospitality industry), as well as smaller ones in fast growing and high-tech industries such as GSMA Mobile World Congress Shanghai. It was also the venue of the Huawei Annual Conference in 2017.

The China (Shanghai) Pilot Free Trade Zone, which was launched in September 2013, was China's first FTZ and has paved the way for development of other such zones in the country. As of September, 49,000 enterprises were registered in the Shanghai FTZ.

In addition to the FTZ, Kruppe said he is also aware of the opportunities created from the Belt and Road Initiative in the fields of infrastructure and logistics.

"Once these developments are on the right track, business, investments, travel, etc, will automatically follow. This, in turn will provide several growth opportunities for the exhibition industry," he said.

According to Kruppe, though the SNIEC's growth rate is not as big as five years ago, the current level of between 2 percent and 5 percent is still strong enough.

The China Council for the Promotion of International Trade recently published a report indicating that about 70 percent of China's exhibition venues had an occupancy rate of less than 20 percent. This poses great challenges for such venues to stay profit-able, said Kruppe.

"We are listening very carefully to the requests from the show organizers. This is not rocket science but it requires 100 percent focus from us on the customer and the details. We need to deliver top quality services on a daily basis," Kruppe said.

"We adapted to the Chinese way by introducing digital services like various WeChat functions, mobile charging stations and even e-car service stations at our venue," he added.

"The trade fair and convention sector is an international, intensely competitive business. Therefore it is imperative for every fair organizer to adapt its portfolio to the most recent developments, anticipate new trends, and continue to attract exhibitors and visitors by providing a highly attractive environment," said Bernd Aufderheide, CEO of Hamburg Messe und Congress GmbH, which is setting up a new office in Shanghai.

Hamburg Messe und Congress GmbH is coordinating the German joint fair stand at this year's Marintec China, featuring 90 exhibitors and 21 associate exhibitors on a combined surface area of 1,900 square meters.

"These numbers show that in China's maritime industry, there is an enormous demand for German suppliers," said Aufderheide.

The biennial Marintec China 2017 held in Shanghai earlier this month is regarded Asia's biggest as well as the world's second largest maritime exhibition.

"All in all we are facing exciting times and we are all happy that we can be part of it," said Kruppe.