Companies eyeing opportunity in Hu’s visit

Businesses are hoping the first visit ever by a Chinese head of state will be a lucrative one

Chinese President Hu Jintao’s upcoming state visit to Denmark, the first by a Chinese president, is being interpreted as a sign of fresh opportunities to deeper bilateral relations between the two countries.

Hu’s visit from June 14 to 16 is aimed at strengthening the two countries’ comprehensive strategic partnership, which was forged in 2008. It will also mark another milestone in bilateral relations since the two countries established diplomatic ties in 1950. It will raise Denmark’s profile in China and help bring the world’s second-largest economy closer to Europe.

“I very much look forward to the historic visit of President Hu Jintao,” the prime minister, Helle Thorning-Schmidt, said in a statement last week. “China’s role and relevance in the development of large parts of the world has grown rapidly in recent years. Both Denmark and China have much to gain by a closer relationship and I look forward to discussing how we can further strengthen the depth and breadth of our strategic partnership,” she said.

Denmark is the only Nordic country and one of the few countries in Europe that has a strategic partnership with China.

Unique event

“We have never had a Chinese president visiting us, so this is absolutely unique,” said Professor Verner Worm, director of Copenhagen Business Confucius Institute of Chinese language and culture.

“It will bring the relationship up to a level we have not seen for many years,” Worm told Xinhua. “Denmark was one of the first countries to set up diplomatic relations with China and, hopefully, we can continue to be a country that supports China and works closely with it.”

Queen Margrethe II made a state visit to China in 1979, the first by a Western monarch. In 1974, PM Poul Hartling was among the first Western heads of government to pay an official visit to China. Five other Danish prime ministers have since made the journey.

During the upcoming trip, Hu will have a private meeting with Queen Margrethe, and attend a state banquet at Christiansborg Castle, the seat of parliament, on June 15.

His visit would pave the way for more high-level visits from both sides, said Professor Kjeld Erik Broedsgaard of the Asia Research Center at Copenhagen Business School.

“The visit is very important on a symbolic level, no matter what they reach in terms of specific agreements,” Broedsgaard said.

“It will further improve our Sino-Danish relations and, of course, it will be interesting to see what kinds of specific results there are,” he told Xinhua.

Ordinary Danes are also curious and optimistic about Hu’s visit. News blogs and social media sites have been abuzz as mainstream media build up coverage ahead of the trip.

“Denmark is impressed with, and positive about, China’s economic success – we want to be part of it, and we can see how millions of people are living better lives there today than just a few years ago,” said Claus Sjoerslev Madsen, a Copenhagen high-school teacher who previously worked and lived in China.

“Denmark should welcome the opportunity to expand relations with China, not only commercially, but also culturally, politically and on human rights issues.”

Per Stig Møller, who served as foreign minister from 2001 to 2010, echoed these thoughts.

“China is a decisive global player with whom it is important to have dialogue.”

He said the occasion presented a great chance to discuss pressing global issues, including the economic crisis and China’s relations with the European Union.

Economy, sustainability

The prime minister’s office said discussions during Hu’s visit would largely focus on issues of sustainability and the economy.

Danish businesses already have major commercial interests in China, and Hu’s visit is expected to further bolster two-way trade and business opportunities.

“China is an increasingly important market for Danish companies and China is our sixth largest trading partner,” the trade minister, Pia Olsen Dyhr, said.

“Danish exports to China are expected to grow by more than 20 percent in 2012, and many large Danish companies consider China their second home market,” she told Xinhua in a written comment.

Pointing out that Danish companies “have been active in China for decades” and that more than 465 Danish companies currently operated in China, she said “the presidential visit will be an eye opener for leading Chinese companies and convince them of the Danish competencies within Information and Communications Technologies (ICT), clean-tech and life science.”

Denmark will no doubt highlight its core strengths, such as its low public debt, its limited exposure to the eurozone sovereign debt crisis, and its geographical location, which helps it act as a commercial bridge between Scandinavia and Europe’s mainland for foreign investors.

Moreover, the country’s competencies in renewable energy technologies such as biofuels and wind-turbine manufacturing, as well as in waste and water management, energy efficient devices, agricultural production and food safety standards, cater to a vast demand in the Chinese market.

“We have some competencies in Denmark which can be used in China and which can make it easier for China to fulfill their five-year plans,” said Tom Jensen, secretary general of the Danish-Chinese Business Forum (DCBF).

“Denmark can also offer Chinese companies a good platform for their activities in Europe and especially northern Europe, so, from that perspective, I see a bright two-way street opening up,” he told Xinhua.

Prospective agreements

The Foreign Ministry, according to public broadcaster DR, a number of agreements are “expected to be concluded” during the presidential visit.

Among these are agreements on cooperation between the Food and Agriculture Ministry and its Chinese counterpart, the export of malt barley, certification of meat products, stronger cooperation on food quality, and organic food products.

Specific contracts remain under wraps, but Dyhr said deals worth “several billion” kroner would be concluded during the visit.

“I absolutely expect that we will close a number of export deals with China,” she said on June 7 in comments cited by Berlingske newspaper.

“China’s most recent 12th Five-Year Plan stresses the importance of achieving quality growth and sustainable development more than ever before,” Danfoss Chairman Jørgen Clausen said in an email to Xinhua on June 7.

“In response, Chinese industries and society are striving to reach green goals by saving energy and reducing carbon emissions in all aspects of work and life. This generates substantial demand for energy-efficient products and solutions,” he said.

Danfoss, along with pharmaceutical company Novo Nordisk, industrial enzyme manufacturer Novozymes, and wind-turbine producer Vestas, are some of the flagship Danish brands that have a deep-rooted market presence and production base in China. They have employed tens of thousands of Chinese across the industrial value chain, and their products supply local and export markets.

Shipping and oil group A.P. Moller-Maersk, the world’s largest container shipping company, believes Hu’s visit will boost the existing good momentum in bilateral trade.

“We expect that the President’s visit will support this momentum and enhance the understanding of China by Danish business and public in general,” Nils S Andersen, the company’s managing director, said in an email to Xinhua.

For Maersk Group, which has invested heavily in terminals, logistics and container factories in China, China remained “a key market” and “a powerhouse for growth in Asia and the world”, he said.

That is a good sign, as the shipping industry remains vital for Denmark’s export-led economy, given that some 10 percent of global, seaborne container traffic is handled by Danish shippers.

According to official Chinese statistics, bilateral trade volume between China and Denmark hit a historical high of about 50 billion kroner in 2011, up 18.3 percent from the previous year. Meanwhile, Denmark has invested in 718 projects in China, with a paid-in investment of about 15 billion kroner.

The Trade Ministry said Denmark’s exports to China were worth 15.1 billion kroner in 2011.

Hu’s upcoming visit offered “a good opportunity to brand China in Denmark, and Denmark in China”, and could help attract more investment from China into Denmark, the DCBF’s Jensen said.

Strategic partnership

Business aside, experts here believe the visit provides the right context for productive dialogue on strategic affairs, especially on Europe, given that Denmark currently holds the rotating EU presidency.

“I hope this visit signifies increased attention to common interests, not only in bilateral relations, but also between the European Union and China,” said Clemens Stubbe Oestergaard, professor emeritus in political science at Aarhus University.

“As the EU needs China in a number of areas, and still has a lot to offer, it is important not to lose any time in strengthening the relationship,” he told Xinhua.

During its EU presidency, which lasts until the end of June, Denmark has worked to find consensus in the 27-member bloc on measures to boost growth and jobs in Europe, with a special focus on green growth.

The CBCI’s Worm said the EU presidency also helped make Denmark “a country which can be China’s gateway to Europe.”

Closer and deeper engagement with China, through the EU and multilateral organizations, and through enhanced trade, could also benefit world peace, development and stability.

Hu will meet Thorning-Schmidt on June 16 to discuss bilateral cooperation, the strategic partnership, and current issues of common concern, the Danish prime minister’s office has said.

While politics and the economy will dominate the headlines during the visit, the Sino-Danish partners will also be aiming to make agreements on cultural and educational areas.

“China has the chance to show more than its economic power by showing other countries its cultural qualities and character,” said Møller, who has also served as Denmark’s culture minister.

Whatever the practical outcomes, the visit is sure to stimulate stronger interest in China from Denmark and the Danes.

“Danes will say, ‘Here is the world’s second-largest economy, and its president has come to Denmark – it is a unique situation’,” Worm said.

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