More Shenzhen enterprises are trying to get a share of the expanding ASEAN market, as China and ASEAN countries started reducing tariffs for over 7,000 products July 1 this year, a substantial step toward building China and ASEAN countries into one the world's biggest free-trade zones by 2010.

Shenzhen's senior government officials, political advisors, leading businesspeople, scholars and officials from ASEAN countries discussed trade opportunities and challenges at the 10 Association of South-East Asian Nations (ASEAN) countries at a two-day forum that ended Sunday.

There was huge potential for Shenzhen and ASEAN countries to cooperate, because the two areas were geographically close and complemented each other economically, said Vice Mayor Chen Yingchun.

The ASEAN countries are rich in natural resources and agricultural products, while Shenzhen's textile, clothing, shoes, food, grain, construction material, electronics, clocks, automobiles, metal and chemical products are popular in ASEAN countries.

The trade volume between Shenzhen and ASEAN countries reached US$20 billion in 2004, one fifth of China's total trade volume with ASEAN countries. The trade volume between Shenzhen and ASEAN countries from January to June this year jumped 14 percent from the same period last year.

"There has been an increasing trend of Chinese investment to Indonesia recently," said Bambang Khaeroni, commercial attache of the Indonesian Embassy in Beijing.

Dozens of Shenzhen companies such as Huawei Technologies and ZTE had set up branches in ASEAN countries. Nearly 400 companies from ASEAN countries are investing in Shenzhen, including Malaysia's government-owned oil company, Petronas, one of the biggest oil companies in the world.

Xiao Shouqing, board chairman of the Shenzhen Guanri Telecom-Tech Co. Ltd., a pay telephone service provider, sees big opportunities at the ASEAN telecommunication market.

"Many ASEAN countries are opening the operation rights of the telecommunication sector, which is once in a thousand year chance for Chinese telecom service providers," said Xiao, whose products have entered six ASEAN countries.

Cai Xiangdong, general manger of Shenzhen Neptunus Bioengineering Group, is cooperating with an Indonesian medicine company to tap the ASEAN market.

Cai is optimistic about the ASEAN medicine market. Most medicines at the ASEAN countries were now imported from the Western countries, but the Western medicines were too expensive for the ASEAN people. The Chinese medicines were cheap and effective, he said.

Dr. Zhang Jinsheng, director of the Shenzhen WTO Affairs Center, said Shenzhen's logistics industry would have a big role to play at the China-ASEAN free trade zone.

However, experts warned that while Shenzhen enterprises see the big opportunities at Asian countries, they should not overlook the risks at international market brought about by cultural and political differences.

Shi Jianzhong, executive head of the WTO & China-ASEAN Free Trade Area Law and Trade Society (Shenzhen), suggested domestic companies to carefully study the laws of ASEAN countries because the legal systems at some ASEAN countries are incomplete.

Source: China Daily