MILAN, July 17 (Class Editori) - The Chinese market will be increasingly more attractive for Italian companies which are active in the textile-clothing and pharmaceutical sectors, two milestones of the Italian export to China. This has been explained by Mario Boselli, President of Fondazione Italia-Cina and pioneer in that market, and Valtero Canepa, General Manager of Shanghai Bracco Sine Pharmaceutical, by presenting the annual report about Fondazione Italia-Cina – just published - on Class CNBC, the TV channel of Class Editori group (which edits this platform).
Question: Mr. Boselli, will the Italian textile sector continue to be one of the milestones in the Italian-Chinese interchange?
Answer: Yes, even though the balance of trade will certainly be in favor of China, because Chinese imports are lower than exports towards Italy. However, we have to understand the difference between “textile”, namely yarns and fabrics, and the end products, namely clothing and accessories.
Q. So?
A. In both sectors, outlooks are excellent. In the last years, the clothing sector has benefited from the improvement of the standard of living of Chinese consumers, who have started to buy the high-end prêt-à-porter product from Italy.
Q. And in the textile sector?
A. Since the Chinese competitiveness, which was based on low-cost workforce and dumping policies, has increasingly decreased, a new opportunity for Italian companies has arisen.
Q. Could you explain that?
A. There are some Chinese enterprises, also small and medium-sized ones, which need to buy Italian fabrics in order to have a quality and creativity upgrade. Therefore, they will buy Italian textile products, in particular fabrics but also yarns. On the other side, the Chinese consumer standard of living will continue to improve and in the next 5-8 years there will be 400 million new Chinese consumers who will enter the market: therefore, we will be able to seize particularly interesting opportunities in the finished products export: clothing, shoes and accessories.
Q. Are there any signals of this kind?
A. Between 2017 and 2019, exports of clothing, therefore finished products, increased from 689 million to about 1 billion, while the export of textile products grew by more than 4%. This is the trend we lean on.
Q. Any problem?
A. Small and medium-sized enterprises of the sector, namely high-quality companies which produce the real Made in Italy. The Chinese consumer, who is quickly evolving, is starting to ask for this kind of production, because they are original products, made in Italy, of high quality and they cost a little bit less than the Big Names and Big Brands products.
Q. So what is the difficulty?
A. Dimension. As Fondazione Italia-China we are doing and we will do our best in order to help these realities, exactly as I helped them when I was President of the National Chamber of Italian Fashion, by bringing stylists when there was the possibility to go to Chinese Fashion Weeks in Beijing, Shanghai and Shenzhen. Leaving space to small and medium-sized enterprises of the fashion system will be needed.
Q. In the pharmaceutical field, Chinese export recorded an increase by 37.8% between 2018 and 2019; however, despite this data, Italy has ranked sixth at a European level. Why, Dr. Canepa?
A. Italy has always been the first pharmaceutical producer in Europe, but in many cases Italian products have reached China through international brands because Italian companies act as country manufacturers for international companies. Therefore, when we look at the balance of payment and the Italian export contribution to China in the pharmaceutical field, we should also consider a part of export, which passes through other countries.
Q. Is Italian ranking better than what is showed by this data?
A. Italy is more a producer than a trader country. There are not many Italian companies, which, by having success abroad, have been able to build an international presence. In China there are only few of them.
Q. What about market outlooks?
A. The procedures for purchasing medicines in China must be considered. This happens mainly through hospitals because the Chinese patient- in the vast majority of cases- calls doctors who work in public hospitals and there is not a family doctor to contact in order to get a new prescription of the medicine.
Q. And then?
A. During the lockdown, when hospitals have been closed to not COVID patients, there has been a consequence on the market: a negative impact for those who sold medicines requiring hospital prescription and a positive one for the-counter products, as well as a significant increase in sales on the e-commerce channels of medicines.
Q. What about now?
A. The situation is moving back. In June, Bracco pharmaceutical company closed the fiscal month with slightly better results than the previous year; therefore, we have fully recovered and we have strong growth outlooks for the second half of the year.
Q. As for the future?
A. China is the second pharmaceutical market worldwide and also the most growing market. As a result, the outlooks are very interesting. It is needed to come to China with the market knowledge and have differential products because the generic Chinese industry is very advanced and having a commercial presence personally managed may be necessary.
Q. Any advices?
A. It is very difficult to be active in the pharmaceutical sector in China simply as export manager towards suppliers, unless ‘off patent’ molecules are owned and the aim is selling only the raw material to the producers of generic medicines.
(Source:Class Editori)
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