As the global economy faces mounting downward pressure and
factors of uncertainties, the global plastics and rubber
industries are at crossroads. The challenges are steering
investments to become more conservative as companies adjust
their strategies. However, growth outlook remains strong for
Asian markets that are not new to economic ups and downs,
especially the emerging economies in the region. CHINAPLAS
2020 takes a "local + regional + global" approach and
provides a platform of highly cost-effective and
technologically advanced solutions that fit the needs of new
markets for both upstream and downstream players.
Asia leads the world in economic vitality
Asia has become the largest cluster of emerging economies in
the 21st century. This region boasts more than half of the
world's population, expanding middle class, increasing
consumption, and continuous industrial transformation.
Asia's fast rise remains attractive despite economic
slowdown. Asia currently represents more than a third of the
global economy, and its self-reliance continues to
strengthen - trade within Asia far exceeds the total of
Asia's trade with other regions such as North America and
Eurozone.
Attracted by the region's momentum, foreign investment
continues to grow in Asia. According to the "Progress of
Asian Economic Integration Annual Report 2019" by the BoAo
Forum for Asia, investments are retreating from developed
economies, especially the capital market in the U.S., and
instead going into emerging Asian markets. China's Ministry
of Commerce announced in November 2019 that China is gaining
more foreign investment, not less, despite the sluggish
global investment scene. During the first three quarters of
2019, China established more than 30,000 new
foreign-invested enterprises and utilized 683.2 billion yuan
of foreign investment - up 6.5% year over year.
Strong growth in emerging Asian markets
Emerging economies in Asia are continuously introducing new
policies to help companies transform and to attract foreign
capital. Combining that with their domestic market potential,
the manufacturing sector is growing in leaps and bounds.
Every year, about 60% of CHINAPLAS overseas visitors come
from Asia. And the number of visitors from Southeast Asia
has been growing in recent years.
Vietnam is becoming a rising star in the region. According
to the nation's General Statistics Office, its GDP grew by
6.98% YOY in the first nine months of 2019, the highest rate
in the past 9 years. Furthermore, the plastics industry
there has averaged annual growth rate of 15-20% in the last
decade.
Among Vietnam's advantages is its demographic dividend that
features a large pool of low-cost labor, combined with
competitive costs of land, energy, and taxes. In addition,
its ports and stable currency have supported the growth of
its export-oriented manufacturing sector. Many multinational
conglomerates have established footprint in Vietnam,
including Nike, Adidas, Olympus, Microsoft, Nokia, Canon, LG,
Foxconn, Sony, Samsung and more. Chinese plastics machinery
manufacturers, such as Haitian, BORCH, Yizumi and JWELL,
have also set up production bases, warehouses, subsidiaries,
and after-sales service offices there.
Just like Vietnam, other Asian countries such as Thailand,
Malaysia, Indonesia and India are also delivering solid
growth, each with strong focuses.
Dubbed as the Detroit of Asia, Thailand has become an
automotive capital with 2019 production expected to reach
2.15 million vehicles. Thailand is also known as the World
Kitchen, and its packaging industry is expected to grow at a
CAGR of 4.2% between 2017 and 2020.
Malaysia is also benefiting from rapid growth of the
packaging industry, with more than 1,500 plastics processors
in the nation. Malaysia projects its food and beverage
industry to reach $268 million in revenue in 2019,
sustaining an 18% compound annual growth rate; in the
meanwhile, the pharmaceutical industry is also giving a
boost to the packaging market.
In Indonesia, the food and beverage market grows 3.7%
annually and supports the expansion of the plastics industry.
Automotive investment has been active in Indonesia as well.
Hyundai is investing in an electric car plant with annual
production capacity of 250,000 vehicles. An investment
consortium from South Korea, Japan and China is building a
$4 billion EV battery plant.
In addition, Thailand, Malaysia and Indonesia - the "Big
Three" - have released their respective roadmaps for
electric vehicles.
India, home to a population of 1.3 billion, boasts
demographic dividend, a massive and fast expanding domestic
market, and rapidly growing construction, automotive and
chemical industries.
China rises as a popular regional headquarter location
The global appeal of China's enormous market is self-evident.
The nation continues to see advancement of urbanization,
release of purchasing power of non - tier - 1 cities, a
thriving digital economy, leading 5G and blockchain
technology, and connected mobility. The sheer size of its
domestic market volume, booming exports, and strong
investment are driving China's economy on a high-quality
growth path.
In spite of the global economic slowdown, foreign-invested
enterprises in China remain optimistic about the Chinese
market and continue to invest at these critical times. China
is the world's largest producer and consumer of chemicals.
There is no slowdown in the investment of foreign plastics
machinery and materials suppliers, who are increasingly
setting up regional headquarters, production bases, and/or R&D
centers in China. German chemical giant BASF is investing a
total of $10 billion in an integrated production base in
Guangdong. It is also building a brand new innovation park
in Shanghai and a comprehensive surface treatment site in
Zhejiang. ExxonMobil, Lanxess, Solvay, Dow Chemical, Shell,
Saudi, Saudi Aramco and many more well-known multinational
companies are also expanding their investment in China with
major petrochemical projects via joint venture or sole
proprietorship.
Grounded in Asian markets
To seize the opportunity with rising Asian economies, the
plastics and rubber industries must not miss the upcoming
CHINAPLAS 2020. As the leading global trade show in the
industry, CHINAPLAS was launched in 1983 and has witnesses
the sectors' development along with China's economic
transformation. CHINAPLAS will present 3,900+ exhibitors (more
than 2,500 exhibitors from China), 11 country/region
pavilions including Germany, Italy, U.S., and Japan, as well
as 19 theme zones, centering around innovative solutions in
plastics and rubber machinery, materials and processes.
Visitors will be able to take a peek at the most
cutting-edge technologies in the world, but also find highly
cost-effective solution packages. China's plastics and
rubber machinery and material have made great progress and
gained market popularity with technologies comparable to
international standards, excellent durability and stability,
quality of service and cost-effectiveness. In Asia,
especially Southeast Asia, machinery and materials from
China well fit the needs of the industry at the current
stage.
Song Yew Eng from Malaysia's Chuan Weng Plastic SDN BHD said,
"In the past, we relied on labor supply from Indonesia and
Vietnam to offset our shortage, but workers from Vietnam are
on the decline. I found the right machinery at CHINAPLAS to
make up for our labor shortage. There are lots of options
for semi-automatic machines that meet production needs and
are cost-effective at the same time. As of now, our
production has not reached the stage of full automation, and
high-end machinery does not suit our current particular
needs."
Due to the relatively weak industrial infrastructure in
Vietnam, the plastics industry there faces shortages of raw
materials and processing equipment - companies there are in
dire need of advanced production equipment and materials.
Tran Ngoc Linh, Director of Manutronics in Vietnam, stated
during his last CHINAPLAS visit, "I'm from Vietnam. I come
to CHINAPLAS mainly to find new business and new partners.
Since we are now focusing on one-stop solutions, we are
looking for materials for electronic components. The show is
massive. I've spent two days on the show floor, but still
haven't been able to visit all of the suppliers that I'm
interested in."
CHINAPLAS has deep roots in China but has tasked itself with
serving the Asian markets to the fullest. Regardless of
their region and business scale, visitors will for sure gain
a lot - find suitable products and solutions to tackle
business growth challenges, reduce production costs, reach
breakthroughs in new product development, and accomplish
environmentally friendly and sustainable growth.
CHINAPLAS is scheduled to return to the National Exhibition
and Convention Center, in Hongqiao, Shanghai, PR China on
April 21-24, 2020. This iconic industry event is expected to
present 340,000 square meters of exhibition space, bring
together 3,900+ global exhibitors and 180,000+ visitors, to
join hands to overcome the challenges, and together create a
prosperous future.
