Landmark Asia Pacific Foundation of Canada survey reveals more than
three-quarters of Canadian businesses in China are profitable despite
constraints to doing business

VANCOUVER, Oct. 26 /CNW/ - A report released today reveals that 76% of surveyed Canadian companies operating in China are profitable despite challenges such as the inconsistent interpretation of legislation, red tape, and pollution.

The report  -- Canadian Businesses in China 2010: Survey of Constraints and Opportunities -- was undertaken by the Asia Pacific Foundation of Canada (APF Canada, www.asiapacific.ca) and is the first of its kind focusing on exclusively on the views of Canadian firms in China.  It was launched today at the Annual TE Ladner Business Law Symposium hosted by the Vancouver offices of the national law firm Borden Ladner Gervais LLP (www.blg.com).

As the world flocks to China for business opportunities, there is growing interest in the operations of foreign enterprises in China and the obstacles that they face. The APF Canada report provides a unique Canadian perspective that can be benchmarked against findings of similar studies by groups such as the American and German Chambers of Commerce in China.

The finding that most Canadian companies in China are profitable runs counter to a common perception that it is very difficult for foreign firms to make money in that market.  An even larger number of respondents (85%) expressed some level of satisfaction with their current overall performance in China.

At the same time, 68% of respondents highlighted the problem of inconsistent interpretation of regulations as a major business constraint.  Other challenges include the lack of transparency and bureaucratic red tape -- in particular obtaining a business permit/license. These findings stand in contrast to the concerns expressed by other foreign firms in China, which tend to focus on the lack of qualified personnel, intellectual property rights, and limited market access as the key impediments to doing business in China.

"The obstacles to doing business in China should not be underestimated.  The results of this survey provide a roadmap for Canadian and Chinese interests, together with the international business community, to work on business constraints such as the inconsistent interpretation of regulations and lack of transparency in China," said APF Canada President and CEO, Yuen Pau Woo.

Also in contrast with other studies of foreign enterprises in China, most of the APF Canada survey respondents were in the services sector.  When asked about the living environment in China, respondents expressed a high degree of satisfaction with respect to housing, safety, and social support, but were clearly dissatisfied with the air quality and level of pollution.

China is Canada's second largest trading partner in the world and one of the fastest growing export markets for Canadian firms. Mr. Woo added: "There is no question that two-way commercial ties between Canada and China will grow in the years ahead. The challenge is to remove the barriers that hold back the potential for even stronger and deeper economic relations between the two countries."

The survey was conducted by APF Canada between August and October 2010 among over 600 Canadian companies that have done business in China. The survey received 95 valid responses, representing a 16% response rate. The survey was supported by the Canada China Business Council, the Government of Quebec, Canadian Chamber of Commerce in Shanghai, Export Development Canada, and Canadian trade offices in China.

For a link to the survey, please click here: http://www.asiapacific.ca/surveys/other-surveys/canadian-businesses-china-2010-survey-constraints-and-opport

About APF Canada
The Asia Pacific Foundation of Canada, created by an Act of Parliament in 1984, is an independent, not-for-profit think-tank on Canada's relations with Asia. The Foundation functions as a knowledge broker, bringing together people and knowledge to provide current and comprehensive research, analysis and information on Canada's transpacific relations. It promotes dialogue on economic, security, political and social issues, fostering informed decision-making in the Canadian public, private and non-governmental sectors. The Foundation also provides grants to support policy research and informed discussion on Canada's relations with Asia.

For further information:

Trang Nguyen
Communications Manager
Asia Pacific Foundation of Canada
Tel: [phone]
Email: [email protected]