Orders from foreign governments, international organizations and multinational giants have boosted China's exports. Multinationals bought less than 10 billion USD worth of goods in China in 2000. The value jumped to 55 billion USD in 2003 which accounted for 13 percent of total Chinese exports that year.

More and more multinationals have chosen Chinese suppliers for their global operation. Take retailing giants with global business as an example. IKEA has made China its most important source of raw materials and half processed products. Wal-Mart's bill in China inflated to 18 billion USD in 2004 after an annual rise of 3 billion USD since 2002.

In Shenzhen alone, multinational retailers, including IKEA, B&Q, OBI, TARGET and Wal-Mart, have or will set up their procurement centers for their regional, Asian or even global operation. The latest news is about the plan of AEON from Japan, the biggest retailer in Asia and the 13th in the world, for its global sourcing center in Shenzhen.

For Chinese producers, global sourcing provides new extensive possibilities for their exports and a reliable barometer of the world market. Their efforts on improving their quality for successful bidding will make them more competitive.

The prospect of global sourcing will also put spurs to China's logistics business. Logistic companies are not playing a big role in the trade in China.

Solely foreign funded export procurement centers are allowed in China now. Their export business enjoys the same treatment as their peers in the Chinese mainland, including tax rebates. The vision of rising sourcing centers will in turn add potential to logistics.

Source:People's Daily