Local economy set to benefit from business links with China

A TRADE delegation that saw council and business leaders travel to the Chinese city of Chengdu last October will deliver significant long-term economic benefits to Sheffield and South Yorkshire, according to a report compiled about the visit.

Senior executives from several Sheffield companies were joined by top staff from city development company Creative Sheffield and council leader Paul Scriven on the trip to "build links" with Chinese enterprises.

According to statistics due to be presented to senior councillors, four companies from Sheffield are now negotiating contracts with businesses in the Chengdu region, while three others plan similar moves.

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Chengdu, a large city in south-west China, has a population of about five million people and is the provincial capital of Sichuan province, home to seven million more.

A relationship has developed over recent years between Sheffield and Chengdu after the chairman of Sheffield United, Kevin McCabe, bought a football team in the city – which is now known as the Chengdu Blades.

In 2009, Sheffield Council decided that it should try and build more trade links with China after an independent report found the city was not promoting itself in emerging economies in the Far East.

A "sister city" agreement had already been drawn up and last autumn's visit was designed to increase face to face contact, which according to experts is the best way to build relationships in China.

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The report on the visit says: "A strong impetus for the relationship between the two cities has been the relationship between Chengdu Blades and Sheffield United.

"The presence of the Chengdu Blades has been vital in spreading awareness of Sheffield in Chengdu and also of Chengdu in Sheffield. This gives Sheffield a unique sporting and cultural link with Chengdu that no other sister or partner city has."

According to the report, building on the football link will put Sheffield in a position as the "destination of choice" for Chinese companies looking to enter the European Union economy.

At present economic chiefs in the city fear that small and medium-sized firms are struggling to find a foothold in the Chinese market and claim that trade visits have to take place to help them achieve.

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Their report says: "In order to ensure long-term prosperity, Sheffield companies need to engage in rapidly growing, emerging economies such as China.

"It is estimated that by 2050, China will be the world's largest economy, with a middle class of 520m people, which is larger than the current population of the European Union which is around 500m.

"Unlike in Western markets, the Chinese system places particular importance on government to government relations which can be used to directly benefit company to company contacts.

"Many Sheffield companies, in particular small and medium-sized enterprises, consistently tell us that they struggle to engage in the Chinese market due to cultural, language and legal barriers."

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At present, the costs of trade delegations have been met by grants and private sponsorship, and the report says that Councillor Scriven's costs were met by private donations.

The report also reveals that a long-standing relationship between Sheffield and the steel city of Anshan, in the country's Liaoning province, will now take a back seat in favour of building links with Chengdu.

It adds: "Over a number of years it has become clear that Sheffield and Anshan are two cities which have a limited match of industrial sectors and trade opportunities, with Anshan's geographic position offering few links to other growth cities. However, scope remains to develop economic, educational and cultural links with Anshan, as and when opportunities arise."