Victor Escribano |
Shanghai (China) (EFE) present new opportunities from the economic and commercial point of view.
The trip of the Spanish president takes place shortly before he assumes the rotating presidency of the European Union (EU) and, according to the Minister of Foreign Affairs, José Manuel Albares, it will serve especially to ask the Chinese leader, Xi Jinping, to “use his personal influence” to get Russian President Vladimir Putin to “end the war in Ukraine.”
However, Sánchez will also dedicate space during his brief visit to economic affairs, since he will give a speech before the Boao Forum -considered the ‘Asian Davos’- and will hold a meeting with Spanish businessmen who operate in China.
The Asian giant is Spain’s main trading partner outside the EU and fourth in the total list, behind France, Germany and Italy and ahead of the United States and Portugal.
According to data from the Spanish Ministry of Industry, Commerce and Tourism, in 2022 Spain carried out exports to China worth some 8,014 million euros, while trade in the opposite direction reached 49,653 million euros.
an asymmetric relationship
The evolution of these data in recent years has been especially favorable for China: since 2019, the year before the pandemic, Spanish exports to the Asian country increased by 17.85%, while those from China to Spain did the same. 70.38% of its own, aggravating the situation of chronic deficit that marks the bilateral balance.
However, the uneven evolution of trade in the years of the pandemic is mainly due to the different moments in which both economies began to recover from the restrictions imposed in the framework of the health crisis, still in force in China until the beginning of this same year. year in the form of the national ‘zero covid’ policy, which kept the country practically isolated from the outside for almost three years.
“We have come out of the crisis much earlier, and we have begun to pull imports long before them,” the chief economic and commercial adviser for Spain in Shanghai, Juan José Zaballa, explained to EFE, who, however, acknowledges that they continue to exist. a series of “asymmetries” that mean that the local market is much more protected from Spanish exports than the Spanish from China.
Likewise, Zaballa warns of the composition of Spanish exports to China, led by products with low added value such as pork, favored by the African swine fever epidemic that decimated the Chinese national herd, although he qualifies that, as progress is made in In the list, other types of more elaborate goods appear, such as pharmaceutical products or machinery.
“The reality is that this market is seriously unaware of the potential of the Spanish product outside of the traditional agri-food product and, consequently, we have a lot of work ahead of us to be able to present the true Spanish industrial and competitive image,” he says.
Added to this is the fact that Spanish companies generally fall into the category of SMEs and, therefore, have difficulties in undertaking the necessary investment in promotion that access to China entails: “It is an extremely difficult, competitive and regulated market. It is very protected. And getting in is expensive.
investment opportunities
For this reason, Zaballa believes that the future of economic relations between Spain and China does not depend solely on exports, but that it is more attractive on the investment side, “perhaps a more interesting strategic option”, with opportunities for Spanish companies in sectors like technological products.
The Spanish representative also analyzed the presence of Chinese companies in Spain and the evolution of the investment profile, marked towards the middle of the last decade by an “anarchy” in which “any sector invested in any sector” to a situation of “greater discipline ” in recent years.
“Chinese companies are investing in Spain in sectors that are increasingly linked to their main businesses. (…) Each time we will see greater rigor in the selection of destinations, ”says Zaballa.
In his opinion, the most attractive sectors for Chinese investment are sectors such as automobiles and their components, batteries or, currently, energy -mainly in the renewables segment-, with diversification opportunities in industries such as chemicals, that of plastic or special materials.
Beyond the industry itself, Zaballa points out that Spain enjoys a “great comparative advantage” due to its geographical location, and compares it with the case of Mexico: “Being located next to markets of 350 million inhabitants with great purchasing power ”.
“If you add a great infrastructure, a service economy, great competitiveness, openness, an unbeatable business climate and a situation of practically insignificant political risk, under these conditions, Spain is going to be one of the fundamental destinations for Chinese investment. in Europe, a productive investment and to satisfy the European market”, foresees the counselor.