Industry Overview
Services
The construction market is a major driver of China’s economy. During the 11th Five Year period (2006-2010), the plan for total construction is estimated to reach 2 billion square meters each year. According to the Industrialization Report issued by the Ministry of Construction’s Promotion Center for Housing, by 2010, China will have built 80 billion square meters of new housing. By 2020, estimates are 205 billion square meters. Construction spending in China increased 165% in the last four years, according to the National Bureau of Statistics of China, and is still expanding at 25% annually.
China is in the midst of a historic urbanization process. Coupled with the privatization of the real estate market, higher living standards, and the presence of multinational corporations in China, home ownership is increasing markedly and demand for residential housing will continue to be strong. High housing costs, poor construction quality, ever-changing Chinese government real estate-related regulations, and limited financing options continue to drag on the housing sector.
Infrastructure
Under the 11th Five-Year Plan, China will invest $26 billion in the construction of eight hydropower projects and $5.9 billion in transferring electricity from western to eastern China. The total investment for water conservation and hydropower projects will exceed $104 billion. China will not only develop hydroelectricity and nuclear power plants, but will also be exploring and developing large coal bases. China recently explored 28 mid-to-large gas fields, and the development of gas fields and pipelines will also offer potential construction opportunities. Under the 11th Five Year Plan, China plans to build 4 major pipelines for oil and natural gas transport. Furthermore, China will be expanding several key airports and build new sub-branch airports.
Regulations
On January 5, 2007, the Ministry of Construction issued implementing regulations for foreign-invested design enterprises (FIDEs) to apply for architecture, engineering and design licenses in China under Decree 114. With the issuance of implementing rules for Decree 114, American ACE firms can now apply for engineering and design licenses in China and pursue ACE-related opportunities.
Market Entry
Domestic design institutes dominate the middle and low-end market. Their strengths are understanding the needs of the local market and knowledge of government policies. However, they lack quality control, exposure to international standards, and professional management experience. Foreign building products and foreign ACE services are perceived as superior to local substitutes.
Most of the clients of foreign engineering firms active in China are foreign investors. These projects are mainly infrastructure projects, factories, hotels, luxury housing, offices, and malls as the requirements for these projects are more sophisticated and clients usually demand premium engineering services and consulting work.
More and more domestic real estate developers are looking for high-quality architectural services. This niche market offers foreign ACE firms good opportunities in the long term. While Chinese architects have rich experience in small and medium-sized buildings, they often lack experience with large-scale projects such as integrated projects. Other weak points include intelligent architecture and the integration of new technology and building materials
Despite the opportunities in China’s market, foreign firms will find that China is not an easy market. American companies have to recognize the need for a special approach to a market with such a contrasting cultural, political and economic landscape. The most successful businesses in China are those that take the time to build strong relationships, become recognized in the industry, and develop products and services that cater to Chinese buyers.
Building good local relations are crucial to foreign firms seeking to provide ACE services in China. Forming a close relationship with a local partner can help you navigate the opaque regulatory system, as well as provide a strong local presence with local contacts.
Presently, most of China’s large projects need to go through an open tender system, and all the bids will be accepted on a competitive basis. The winning bidders and new venue owners will have a great deal of autonomy in deciding how to construct and operate the project and how to award this work.
Home Ownership Benefits
A substantial tax advantage is available for those Chinese in the high-income bracket who own their own homes. People in this category are a small percentage, but are still comparable in numbers to the entire population of Canada. Some people are buying additional homes just so they can continue receiving the tax benifit.
Getting established in China requires patience, commitment, and most of all, time. American firms may need several years to make a profit in China and will face stiff competition from local firms and from other foreign firms.
Fast Facts
- By 2010, China will have built 80 billion square meters of new housing.
- Ministry of Construction issued implementing regulations for foreign-invested design enterprises (FIDEs) to apply for architecture, engineering and design licenses in China under Decree 114. With the issuance of implementing rules for Decree 114, American ACE firms can now apply for engineering and design licenses in China and pursue ACE-related opportunities.
Upcoming Events and Tradeshows
This section provides a listing of upcoming architecture, construction and engineering-related events in China and in the US, including industry shows and trade missions. While FCS China is directly involved with some of these events, the majority here have no direct relationship with the FCS and are listed solely as a convenience to our users.
For more information, please contact the organizing group as listed in the event description. Verify the information before making any commitments - we are not responsible for accuracy of information or changes in events' schedules.
BEIJING REGION
The 3rd China International Architecture Expo
Location: Beijing International Exhibition Center
Date: October, 28-31, 2008
Website:http://www.iae-china.com
Fenestration China 2008, International Exhibition on Windows,
Doors, Skylights and Curtain Wall Technology, components, and
prefabricated Units.
Dare: November, 18-21, 2008
Location: China International Exhibition Center, Beijing
Website: http://www.fenestration.com.cn
The 5th International Conference on Intelligent Green and
Energy Efficient Building & New Technologies and Products
Expo
Location: Beijing
Date: March 31 –April 2, 2009
Website: http://www.chinagb.net
International Green Building & Sustainable Cities
Exposition
Location: Beijing International Exhibition Center
Date: June 18-20, 2009
Website: http://www.ecoexpo.com
SHANGHAI REGION
Bauma China 2008
Location : Shanghai
Date:Nov. 25-28, 2008
http://www.bauma-china.com/
China Sustainable Building Forum + Expo.
In Conjunction with China Int’l Landscape Design & Urban
Construction Expo 2009
Location: Shanghai New Int’l Exhibition Center
Date：June 29 – July1，2009
Contact: Mary Cao , Project Manager, VNU Exhibitions Asia
T:+86 21 62477668-995
F:+86 21 62479818
E-mail:mary.cao@vnuexhibitions.com.cn
Add: 3F,Business Mansion, Shanghai Exhibition Center
GUANGZHOU REGION
China Refrigeration
Location: CECF Pazhou Complex, Guangzhou
Date: April 5-7, 2009
Website: http://www.cr-expo.com/en2009/default.asp
CONEXPO Asia 2009
Location: Guangzhou
Date: November 16-19, 2009
Website: http://www.conexpoasia.com/
SHENYANG REGION
China International Furniture Woodworking Machinery Components
& Raw Materials [Summer] Exhibition (Dalian)
Date: June 12-15, 2008
Venue: Dalian International Convention Center & Dalian
Xinghai Convention Center
Show Organizer: Dalian Northern International Exhibition Co.,
Ltd.
English service Contact: Ms. Mariah Cheng, Ms. Cindy Pei, Ms.
Julia Ji
Tel: 86 411 82538681, 82538628, 82538611
Website: http://www.dlfa.cc
USA
U.S. Green Building Conference and Expo
Location: Boston, MA, Boston Convention and Exhibition
Center
Date: November 19-21, 2008
Website: http://www.usgbc.org
International Builder’s Show
Location: Las Vegas Convention Center
Date: January 20-23, 2009
Website: http://www.buildershow.com
Market Research in China
Architecture, Construction & Engineering (ACE) Service
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A brief introduction of Architecture, Construction &
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Commercial Refrigeration Equipment:
This Industry Overview provides information on the following
tips: market demand, market demand, market data, best export
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Architectural Design Services in South China:
China is recognized as potentially the largest architectural
market in the world. It has strong architect expertise, with
11,000 architectural design organizations generating estimated
revenue of US$11.28 billion with annual construction value
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Overview of Energy Saving Building Materials in Sichuan
Province:
China continues to show dramatic growth in its domestic
construction industry. Currently, China’s completed new housing
has reached 1.6 billion to 2 billion square meters, which is the
equivalent total for completed new housing areas for all
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Upcoming Soon
Green Building Sustainability Products & Service Potential
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Green Building Product in South China (August 2008)
Useful Websites
Links to non-Commercial Service organizations are provided solely as a convenience to our users. The Commercial Service makes no representations about the accuracy or suitability of the information provided on the following web sites. The FCS is not responsible for the content of the individual organization webpages found through these links, and their inclusion here should not be understood as an endorsement of these organizations.
Beijing:
Beijing
Investment Platform
Beijing Municipal Commission of Urban Planning
Beijing Organizing Olympic Committee for the XXIX Olympiad
Ministry of Housing and Urban-Rural Development of PRC
China National Association of Engineering Consultants
China Building Materials Industries Association
American Chamber of Commerce – People’s Republic of China
Shanghai:
Shanghai
Municipal Government Urban Construction Website
Shanghai Building Materials Science and Technology Institute
Shanghai Urban Construction Group
Shanghai City Development Law Firm(Specialized in Construction and Real Estate)
Hong Kong:
Architectural Services Department
Electrical and Mechanical Engineering Department
Environment Protection Department
Territory Development Department
American Institute of Architects
Hong Kong Institute of Planners
Hong Kong Institution of Engineers
U.S. Commercial Service Contact Information for ACE
The U.S. Commercial Service offers a broad array of market entry services to U.S. companies in the architecture, construction and engineering industries. Please refer to the following relevant contacts for additional information on how we can help you expand your business in China.
Beijing:
Tel: (86-10)8529-6655
Fax: (86-10)8529-6558/9
Elizabeth
Shieh
Cao Shujuan
Shanghai:
Tel: (86-21)6279-7930
Fax: (86-21)6279-7639
Eric Hsu
Scott Yao Wennie Wang
Guangzhou:
Tel: (86-20)8667-4011
Fax: (86-20)8666-6409
Cathy Wang
Chengdu:
Tel: (86-28)8558-3992
Fax: (86-28)8558-9221
Cui Shiyang
Shenyang:
Tel: (86-24)2322-1198x8142
Fax: (86-24)2322-2206
Liu Yang