——Special highlights on blockchain, new retail, hidden champions, AI, Belt and Road and sharing economy
A gathering among the mountains and rivers in Huairou, planning for future cooperation and development. 2018 World SME Conference, which is themed “mutual understanding, interconnection and sharing” was unveiled today at the Yanqi Lake in Huairou, Beijing. The conference was initiated and sponsored by China Association for Small & Medium Commercial Enterprises and attended by representatives throughout the world. The conference aimed to demonstrate the latest achievements of SMEs in China and called for in-depth discussion on the routes and prospects of SMEs in globalization in the context of fierce market competition, to provide Chinese solutions for SMEs to participate in project cooperation in countries along the Belt and Road.
Staring with 2017, the dreams and stories of Yanqi Lake have become an inseparable part of world SMEs. From the SME Cooperation Forum among the Belt and Road in 2017 to the World SME Conference in 2018, China has clearly presented its attitudes to the entire world that China will facilitate the participation of SMEs in the “Belt and Road” Initiative, help SMEs to realize their globalization, build a cooperation and communication platform for world SMEs and will build up a global SME service system featured by interconnection, mutual understanding, sharing and worldwide integration. The Yanqi Lake not only presents us with a grand feast of the achievements and conceptions of world leading SMEs, but also witnesses the progress and dreams of world SMEs. With her inclusiveness and opening, all the greatest minds and thoughts are gathering here, contributing their wisdom and talents to the common prosperous future of SMEs.
The lead goose makes smooth flights for the flock, while the broad lake makes peaceful voyage for boats. Today, the conference opens again and receives the outstanding representatives of SMEs throughout the world, including government leaders, industrial pioneers, great educators and researchers, who will, in the next two days, share their opinions and ideas on supports and services to SMEs, innovation and entrepreneurship, participation in the Belt and Road Initiative, improvements of the financing service systems and development of blockchain technologies. The heated discussion will be focused on the hidden champions in Germany, Chinese solutions in supports to SMEs, the latest innovation and achievements, international cooperation opportunities and the future paths of SMEs. Yanqi Lake is more than the birthplace of the World SME Conference, but is the perfect stage for world SMEs where they create their innovative new chapters that benefit all SMEs throughout the world.
Mr. Ma Peihua, Vice Chairman of the 12th CPPCC and President of China Association for Friendship with Latin America and Caribbean Area, said in his speech that to expand the scale of imports, China must help foreign enterprises with their exports to China. In the past, most exports to China were by large enterprises. However, in the context of fragmentized global trade and prominent trends of personalized and customized services, foreign SMEs have become the main forces that satisfy China’s demands from expanded imports. In fact, most enterprises throughout the world are small and medium sized enterprises. In most countries, SMEs make the largest proportion of enterprises, specifically 95% of enterprises are small and medium enterprises. It is commonly known that China has a huge domestic market, however the lack of information, complicated and tedious customs procedures, difficulties in enterprise credit reference and the insufficient trade financing have created various barriers that set back the exportation of foreign SMEs to China. However, with E-commerce, SMEs can easily improve their capacity in global trade, and reach the global customers, receive orders and accumulate credit points at lower costs.
As Mr. Wang Qinmin, Vice Chairman of the 12th CPPCC and former Chairman of All-China Federation of Industry and Commerce, said in his speech, SMEs are the most active group in innovation activities, as they can make quick and swift responses and adaption to new technologies in the international markets and provide products and services that are better customized to market demands. The relatively small size of SMEs make them flexible and agile in responding to market changes and in adapting themselves accordingly to the fast-change market conditions. Besides, Chinese SMEs are able to provide products in diverse types and are competitive in the markets, so a promising prospect can be expected for Chinese SMEs in countries along the “Belt and Road”. Supports should be given to SMEs to promote and facilitate the implementation of “Belt and Road” Initiatives through participating in local markets in the “Belt and Road” countries, which helps to play the roles of market in decision resources allocation and in realizing healthy interaction between the supply side and the demand side. Extensive participation of SMEs helps to amplify the benefits brought about by the “Belt and Road” countries and to enhance the civil connection between different nations. This will finally bring concrete benefits to the general public in these countries.
Mr. Massimo D’Alema, former Prime Minister of Italy, said in his speech that 99% of Italian enterprises, i.e. about 4.2 million enterprises, are SMEs as defined by European Union. Italian SMEs have good business reputation and strong competitiveness, especially in leatherware, shoemaking, textiles, clothing, jewelry making, sanitary ware, machinery, furniture, glass ware and marble products, which make the main part of exports and foreign exchange earnings in Italy. The success of Italian SMEs is driven by four factors: supports from central and local governments; centralized development and “flexible specialization” production; continuous innovation in production design and management models; and the building of enterprise reputation and company culture.
Mr. Jiang Ming, President of China General Chamber of Commerce and Co-Chairman of 2018 World SME Conference, pointed out that in the new era of commerce featured by new business models and new patterns, conventional commerce is returning to its original purpose of providing desirable commodities to customers. As customer demands are changing from time to time, new actions are required to establish new cooperation and to provide innovative services, which are the main drivers of commerce today, and that innovation is more than of actions than slogans. Innovation is to realize self-improvement and better efficiency through concrete actions. The unchangeable truth of commerce is to provide satisfactory commodities and services to customers. In this process, multilateral cooperation is required to improve the business ecosystem to bring benefits to all parties participating in the process. This should be the undertaking and future of new retail.
Mr. Li Zhenxi, Executive President of China Association for Small & Medium Commercial Enterprises and Chairman of Baoshang Bank Limited, said that the inherent goals of the World SME Conference are to provide SMEs with a “broad stage” to unleash their “great powers”. Backed by the fast economic growth and huge potentials in China and guided by the principles of progressive advance and mutual benefits, China is now an important push of economic cooperation and interconnection and the “Belt and Road” Initiative is opening and leading the new development of globalization. The huge consumer population of over 1.3 billion consumers makes China the largest single market and the most important consumer group of the entire world. China is not only the powerful engine of world economy but also a cornerstone of world peace. China is playing an important role in the international community, which is the most certain thing in the world full of uncertainty, and is providing world SMEs with the big market, platform and infinite opportunities.
Mr. Ralf Bredel, Chief Representative if United Nations Industrial Development Organization, commissioned Mr. Li Yong, the Director-General, gave an address, and said that UNIDO is devoted to the promotion of inclusiveness and sustainable development in all member states, especially special supports should be given to SMEs. UNIDO has accumulated profound experience in helping SMEs in participating in the global and regional value chains, technology cooperation projects and related researches and studies. We keep close cooperation with China MIIT to promote the transition of China to a green and innovation-driven economy, by enhancing our understanding of the “New Industrial Revolution” and “Made in China 2025”programs. The United Nations Industrial Development Organization gives all supports to the World SME Conference and is ready to support and help SMEs in their participation in the Belt and Road Initiative.
Mr. Hermann Simon, a famous expert of business management and the Father of Hidden Champions in Germany, pointed out in his speech that quality and innovation are the critical factors that make a SME the “hidden champion” of its industry.
Simon further clarified that six key factors are required to become a hidden champion: first, the enterprise or the entrepreneur is driven by an irreplaceable goal; second, the corporate core competitiveness (such as standards and products) is not outsourced; third, great importance is attached to self-owned technologies and market shares; fourth, a globalized business chain has been established; fifth, special stress is laid on innovation and the enterprise must be driven by both market and technologies; and sixth, the enterprise has highly effective cultures.
To Chinese SMEs, quality improvement should come first. As low cost is no longer the decisive factor in determining the success of a company, enterprises must participate in the globalization process and establish a marketing network that covers all international markets, and build their international brands.
In the second place, innovation is also a key to hidden champions. It requires that enterprises keep investments in R&D activities and take actions to protect their existing achievements from counterfeiting. Chinese SMEs must re-define their positions in the market and build their core competitiveness by innovation that is driven by markets and technologies.
Apart from quality and innovation, Simon also suggested that Chinese SMEs should maintain close relations with customers, including corporate customers and individual customers, and as customers mean demands, SMEs must combine their technological innovation with customer demands. Besides, special care should be given to employee quality and continuous re-education and training should be provided, which can add their loyalty and the competitiveness of SMEs as well.
Mr. Ye Xiaowen, a chief expert of China Association for Small & Medium Commercial Enterprises and Vice Director of CPPCC Committee of Literature, History and Studies,gave a keynote speech in his unique humorous style. He said that the Belt and Road Initiative needs to overcome two major barriers and requires two big wings, and therefore must further promote the opening of China to avoid falling into the Thucydides Trap. The Belt and Road Initiative is popular and highly recognized in the world, not only because it has the vision of mutual benefits, but also the Chinese cultures give us the confidence. Mr. Ye Dingda, Vice Director of SME Bureau of Ministry of Industry and Information Technology, said that due to the popularization and application of some advanced technologies in SMEs, such as Industrial Internet, Internet of Things, Internet of Vehicles, Big Data, Cloud Computing, and Artificial Intelligence, SMEs have improved capacity in Information Technologies, This has provided new paths and patterns for the growth and transformation of SMEs and has broadened the space for the development. The Ministry of Industry and Information Technology will continue its endeavors in promoting the application of cloud technologies and AI in SMEs. Efforts will be made to guide SMEs in the integration and application of new-generation information technologies, such as cloud computing, Big Data, IoT and AI. And on the other hand, efforts should be made to enhance the capacity of SMEs in market studies, product R&D, production organization, operation management, warehousing and logistics, sales and marketing, as well as service provision and value adding, so as to realize cloud based design and information based decision making and application of intelligence technology. These efforts will help SMEs in making quick and swift response to market changes and in realizing flexible and efficient supply capacity. Mr. Zhao Peng, Chairman of Oxbridge International Group and an expert in international business exchanges, said that the Belt and Road Initiative brings the most valuable opportunities to promote cooperation between SMEs and is also helpful to the development of SMEs. In the future, China should participate in the formulation of international trade principles, and especially SMEs should join in this process and share the benefits of globalization. Joint efforts should be done to promote tax reduction in various countries and to encourage the development of SMEs. This is the only way to stimulate future economic growth, to help youngsters develop their personal careers and to solve the employment issues.
This Conference is attended by over 1,000 representatives from 30 countries, including political VIPs, representatives from international organization and enterprises, so that we can share our opinions in the discussions on the theme of “mutual understanding, interconnection and sharing”. The Conference is focused on key issues, hot topics and regional highlights, and provides key insights into the common challenges, so that consensus can be built and the expected goals can be achieved.
Consensus on cooperation. It is a common belief among all participants that the construction of a community with shared future is the shared belief and hope of all business owners As an important pillar industry supporting the national economy in many countries, SMEs are always the most vigorous and creative enterprises. Confronted with the complicated and fast changing situations, it is a common challenge before SMEs in all countries to achieve robust development in an era of with great development, reforms and restructuring. To achieve this goal of broadening our further development and to break the barriers in the way ahead, SMEs must build consensus on cooperation, stay interconnected and share their experience and practices.
Enhanced pursuit for innovation.As stressed by the VIP speakers, innovation is the soul of a nation, driving its progress and also the engine of a country or an enterprise, boosting its prosperity. The new and valuable opportunities brought to human society by the new round of technological and industrial revolution are also accompanied by new challenges. In the markets with intense competition, SMEs must enhance their awareness of innovation, stay alert to opportunities and take active moves, to maintain their exuberant vitality.
New course set for interconnection. As pointed out by participants to this Conference, economic globalization is a nonreversible trend, because we are living in this “global village” where we are already inseparable from one another. This Conference provides a valuable platform for the interconnection between SMEs from all countries. It pools the efforts of all sides to promote the alignment and planning of related policies, so that they work jointly to realize the community of SMEs with shared prosperity.
Clearly defined goals. As is pointed out by participants, SMEs throughout the world must cooperate practically in various forms, and share and align their projects in the coming future, which provides the foundation for interconnection and shared development. Participants appeal that to turn the beautiful visions and blueprints into reality, strategic thinking and practical actions are required. Participants affirm that through their experience in this Conference, new breakthroughs can be expected in the future development of SMEs.
A single tree supports no entire house, but joined hands make wonderful things. It is commonly believed that the way up ahead SMEs is full of hopes and challenges as well. However bright the future will be, the way to it is never easy. SMEs can share and learn from one another and achieve their lofty goals, only by responding actively to the Belt and Road Initiative, joining their hands and fighting as a team for the way to a sustainable and bright future.