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            CEIBS 25th Anniversary

            1994 - 2019

            Speeches from the CEIBS Insights 2019 Munich and Brussels Forums

            CEIBS President Li Mingjun

            “Since President Xi Jinping’s state visit to Germany in 2017, China and Germany have stepped up political, economic and cultural exchanges, while bilateral trade has also maintained healthy momentum. For three consecutive years, China has been Germany’s largest trading partner [and] German cars, electronics, and household products have long proved popular with Chinese consumers. In addition, China has chosen the Port of Duisburg in Germany’s Ruhr region to be the western terminus for its new Silk Road, also known as the Belt and Road Initiative. Every year, hundreds of thousands of containers packed with commodities will be transported between China and Germany via the China Railway Express freight service.

            In May this year, Chinese Vice-President Wang Qishan paid a visit to Germany. During his trip, he held in-depth discussions with German officials on various areas of cooperation. He also called on China and Germany to step up pragmatic cooperation based on mutual trust, so as to build a stable and positive environment in the region and the world at large. Against this backdrop of a new era of bilateral relations, we’re gathered here today, motivated by our desire to further promote exchange and cooperation between our countries, and between Chinese and German businesses in particular. The theme of the Munich leg of the Europe Forum is “Consumption Upgrading and Technological Revolution”. Under this banner, we will discuss how the Belt and Road Initiative can provide new opportunities for China and Germany to complement each other and achieve win-win outcomes in technological innovation and economic and trade cooperation.

            China Europe International Business School (CEIBS) was co-founded by the Chinese government and European Union 25 years ago, and the Munich Forum is one in a series of events held to mark the school’s 25th anniversary. CEIBS is the only business school in Asia to make it into the top five places in the Financial Times’ MBA and EMBA rankings, and is also the first business school in China to receive both EQUIS and AACSB accreditation. With campuses in Shanghai, Beijing, Shenzhen, Zurich, Accra, and Ghana, CEIBS has a community of over 22,000 alumni across 80 countries and regions. Dedicated to establishing itself as a respected, world-class business school, CEIBS also aspires to become a platform for economic and cultural exchange and cooperation between China and Europe, and the world at large.

            The year 2019 marks the fifth year that CEIBS has hosted the Europe Forum series, and is also the fifth consecutive year of the Munich Forum. This year’s forum features an impressive line-up of senior government officials and knowledgeable experts from China and Germany who will share their insights with us. CEIBS will also work with German companies, and use case studies and trend analysis to explore effective models for innovation and cooperation between China and Germany in business and at the corporate level. We hope that this forum can strengthen communication, and provide a durable and stable platform for promoting further commercial integration between China and Germany."

            CHKD President and ICBC Frankfurt Branch General Manager Zheng Donglin

            “Recently, economic and trade cooperation between China and Germany has been gathering momentum. Germany has consistently been China’s largest European trading partner for over four decades. In 2018, the volume of trade in goods between the two countries totalled nearly 200 billion euros. In addition, China has been Germany’s largest trading partner for the past three years. In brief, bilateral trade is flourishing and cooperation between Chinese and German companies is deepening.

            As China opens its doors wider to the outside world, German companies are making significant inroads in the Chinese market. BASF Group plans to invest USD 10 billion in a highly-integrated production site for fine chemicals in Guangdong Province; Allianz Group will set up the first wholly-owned foreign insurance holding company in China; and BMW Group has increased its stake in the joint-venture BMW Brilliance Automotive from 25% to 75%. All of this indicates that German companies are entering a new stage of investment in China. We are also pleased to see that Chinese companies are making forays into Germany and other European markets. At present, there are over 2,000 Chinese companies invested in Germany, spanning sectors including trade, finance, automobile, machinery, aviation, and telecommunications.

            At the same time, we have seen a new wave of technological and industrial transformation that is sweeping across the globe, while new consumption patterns accelerate global economic integration. Consumer electronics, artificial intelligence, environmental protection, and energy conservation will become a major focus of Sino-German cooperation. Both countries should harness the potential of digitization and innovation and strengthen R&D cooperation in emerging sectors such as artificial intelligence, new energy vehicles, autonomous driving, and intelligent manufacturing, so as to elevate bilateral economic and trade cooperation to a new level.

            Recent changes in consumption patterns are spurring a consumption upgrade, offering significant new opportunities. China’s younger generations are emerging as the dominant consumer demographic, while the digital economy and e-commerce platforms are booming, driving demand for differentiated, personalised, and diversified products and services. China is a vast country with nearly 1.4 billion people, of whom 400 million are middle-income earners with considerable purchasing power and consumer needs. Such demand not only sustains domestic economic growth, but also provides a deep market for consumer products from across the globe. This forum will focus on how premium German brands, and emerging brands in particular, can seize the opportunities presented by China’s consumption upgrade to gain a firm foothold in the Chinese market.

            Thanks to the support of various parties, the Europe Forum is now in its fifth year. Over these past five years, the [CIEBS Insights Munich] Forum has served as a source of inspiration for both German and Chinese entrepreneurs, [it has] sparked innovative thinking, and [has] presented new opportunities for cooperation. There is an ancient Chinese saying that goes, “Nothing can separate people with common goals and ideals, not even mountains and seas.” It is my sincere hope that this Forum will continue to provide Chinese and German entrepreneurs with opportunities to communicate and cooperate, and inject fresh vigour into Sino-German business cooperation."

            Commercial Minister-Counsellor for the Embassy of the People's Republic of China to Germany H.E. Weidong Wang

            "Situated at opposite ends of Eurasia, China is the world’s largest emerging market, while the EU is the largest developed economy. In recent years, Sino-EU economic and trade relations have maintained solid momentum and born rich fruits. This has helped to broaden the scope of bilateral relations and promote cooperation in all fields.

            I’d like to take this opportunity today to share some figures with you: In 2018, China-EU trade reached 682.2 billion dollars, up 10.6 percent from the previous year. On average, that is equivalent to over 1 million dollars in transactions every minutes. The EU has been China’s top trading partner for 15 years in a row. In addition, two-way investment between China and the EU continues to grow rapidly, taking new forms and expanding into new industries and fields. In 2018, Chinese direct investment in the EU totalled USD 8.11 billion, up 7.1 percent year on year, while actual EU investment in China grew 25.7 percent year on year to 10.4 billion dollars.

            Of course, you couldn’t mention the EU without also bringing up Germany. As the EU’s largest economy, Germany is sometimes referred to as Europe’s economic engine. It is only natural then that Sino-German relations play a leading role in China’s relationship with the EU. Recently, closer economic and trade ties between the two countries have carried cooperation between Chinese and German companies to an elevated level.

            Last week, President Xi Jinping met with German Chancellor Angela Merkel on the sidelines of the G20 Summit. Xi called for China and Germany to jointly foster a spirit of innovation and turn competition into cooperation to achieve common development and progress. Xi stated that China welcomes innovation and cooperation between Chinese and German businesses and research institutes, including in fields such as autonomous driving, artificial intelligence, and 5G technology. Xi’s remarks offer a blueprint for further upgrading bilateral economic and trade relations, and a handy framework for interpreting the theme of this forum. Faced with the dual challenges of a consumption upgrade and technological revolution, China and Germany should each play to their own strengths and spearhead the development of the digital economy, benefiting both countries, and the world at large.

            China is currently the world’s second biggest consumer market, with sales of consumer goods only slightly behind the US. For the past five years, consumption has been the primary driver of China’s economic growth. In 2018, consumer spending accounted for more than 70% of GDP growth. More recently, China’s consumer market has entered a new phase characterised by steady consumer spending growth, diversification of consumer needs, and an improved consumption structure. In particular, digitisation and new business models are altering the behaviour of Chinese consumers, leading to the emergence of a unique new consumer market. China has more than twice as many online shoppers as the US and double the sales. It is also a world leader in mobile payments. You may be aware that in many parts of Germany, November 11 marks the start of the traditional carnival season, but in China, this date is associated with a massive online shopping carnival. According to statistics, Alibaba’s online shopping platform, Taobao.com, chalked up 213.5 billion yuan in gross merchandise value on November 1, 2018, with the number of shipments in 24 hours surpassing 1 billion for the first time. Other online shopping platforms, such as JD.com, Suning.com and Kaola.com, also witnessed explosive sales growth on the same day. These figures speak volumes about the willingness and ability of Chinese consumers to spend money.

            As living standards in China continue to improve, Chinese consumers are attaching increasing importance to the quality, features, and uniqueness of products. German products have long had a reputation for good quality and enjoy a popular following among Chinese consumers, whether they are fast-moving consumer goods, cars, machinery, or precision instruments. For example, Volkswagen sold 10 million cars worldwide in 2018, of which 4 million were sold in China, generating 4.6 billion euros in profit, or 35% of its global total. Such a stellar performance owes a great deal to the trust that Chinese consumers place in Volkswagen and the quality of German products.

            China’s vast consumer market and obsession with “Made in Germany” have provided immense business opportunities for German products in China. In June this year, ALDI, a German-based discount supermarket, opened its first offline store in Shanghai. Tens of thousands of customers lined up outside the store on its opening day, and many shelves were stripped bare by midday. In recent years, an assortment of foreign bricks-and-mortar retailers, including Tesco, Carrefour and Walmart, have suffered setbacks in the Chinese market. Amazon, the world’s largest online retailer, has shut down its e-commerce platform in China. One key reason that these overseas retailers have lagged behind their Chinese counterparts is that they didn’t meet the needs of Chinese consumers. In this context, ALDI’s bold venture into the Chinese market underscores its singular business vision and recognition of the potential of China’s consumer market. Of course, it is our hope that German companies don’t take this huge business opportunity for granted: They should operate in good faith, and provide authentic and reliable business services geared to the needs of China’s economy and consumers. Only in this way can German businesses operate sustainably in China.

            Over the past 40 years of reform and opening up, China has become increasingly integrated into the world economy. The 2019 Negative List for foreign investment market access, released just last weekend, has further eased restrictions on foreign investment, demonstrating China’s determination to open its doors wider and offer more opportunities to investors from all over the world. I would like to assure all of you that no matter how the international situation evolves, China will remain committed to cooperation in the context of globalisation. The Chinese government and Chinese businesses will place greater emphasis on international cooperation, push ahead with opening-up policies, and join forces with governments and businesses from around the world to achieve win-win outcomes!

            Since 2012, the Europe Forum has been successfully held in several European cities, and is becoming an increasingly prominent and influential event. The themes of the forum echo broad trends, as well as the current state of Sino-EU economic and trade cooperation, providing a high-level platform for government, economic, and academic exchanges between China and the EU. I hope all present will make full use of this platform to raise new ideas, spark a discussion, and reach a consensus on ways to cooperate, so as to strengthen economic and trade relations between China and Germany, and China and the EU."

            EFMD CEO and Director General Eric Cornuel

            “There is no doubt that innovation is a catalyst for growth, built on the foundations of creative drive, cooperation and openness. Innovation often looks into the future, harnessing the opportunities brought by scientific development and technological advancements. But looking at innovation that has a far-reaching and long-lasting impact on strengthening global collaboration and socio-economic development, we can also learn a great deal from the past, especially when we have an example of an innovative project at our doorstep.

            Since Deng Xiaoping took the reins of power in 1978, he went on to lead market-economy reforms. True to his famous pronouncement, "It doesn't matter whether a cat is black or white, if it catches mice, it is a good cat," he committed his leadership to advance, open and liberalise the economy.

            Improving relations with the outside world was the second of two important philosophical shifts outlined in Deng's programme of reform termed gaige kaifang, which literary means ‘reforms’ and ‘openness’. Ever since, rising population, fast economic growth and higher disposable incomes have triggered rapidly growing demand for business education in China, which, at least at the beginning, outpaced the capacities of the existing higher education institutions.

            This temporary void has inspired some overseas establishments to venture into the Chinese market, like the University of Buffalo which in 1984 opened one of the first two MBA programmes in China, at Dalian University. Since EFMD was established in early 70’, we have also recognised the immense potential for innovation and growth of Chinese business education and management development, and the way the Chinese institutions could enhance their quality even further through collaboration and exchange with other organisations around the world. We took the recognition and advocacy role to pave the way for more social development through education, underpinned by the values of internationalisation, relevance and responsible management.

            In the early 80’s, the European Commission approached EFMD to develop and implement in China a two-year full-time modular MBA programme, preceded by a six-month English course in the country. This was supplemented with a post-study internship in Europe. The objective was to educate, over five years, 100 young Chinese managers in state-of-the-art management. Success of that programme was quickly recognised by then the European Commissioner for External Relations, Willy de Clerq, who expressed strong support for an EFMD proposal to institutionalise it in form of CEMI – the China-Europe Management Institute – which, initiated in 1984, gradually gained independence and self-sustainability thanks to corporate support from the very early days.

            It was a time when management education was virtually non-existent in China. I hope I can say, without being too boastful, that we laid the building blocks for the development of management education in the country, creating a movement and changes in attitudes thanks to which management education has gradually become a flourishing industry.

            Soon, CEMI’s partners – the European Commission, the European Delegation in Beijing and EFMD – concluded that creating a Euro-China joint venture [would be] the best way of ensuring the existence and further development of a long-lasting Euro-China cooperation in the area of management education. In 1994, the Chinese government and the European Commission signed a memorandum on the establishment of the China Europe International Business School (CEIBS), and the EFMD was appointed as the European partner in this 50-50 joint venture.

            As China’s only business school to originate from government-level collaboration, CEIBS is committed to educating responsible leaders versed in “China Depth, Global Breadth”. It is proud to be an autonomous and non-partisan institution, with many distinguished representatives who today sit on its board of directors, including Romano Prodi, Jean-Pierre Raffarin and Hans-Gert P?ttering. Its establishment accelerated the acceptance and development of management education in China. It also [offered] a chance [for] many business schools associated with the EFMD network to gain exposure in China, fostering a culture of international partnerships and collaboration.

            Above all, the establishment of CEIBS contributed to the socio-economic development of China. Since initiating market reforms in 1978, China has experienced rapid economic and social development. GDP growth has averaged nearly 10% a year – the fastest sustained expansion by a major economy in history – and hundreds of million people have been lifted out of poverty.

            CEIBS offers MBA, Finance MBA, EMBA, Global EMBA, Hospitality EMBA, Executive Education and PhD programmes. Renowned for its academic rigour, CEIBS was the first business school on the Chinese mainland to have been accredited by EQUIS and the only business school in Asia to have simultaneously made it to the Financial Times’ top 5 list of MBA and EMBA programmes.

            Indeed, CEIBS has paved the way for many institutions in China and the broader Asia-Pacific region, which instead of emulating the established Western management education models, have not held back from innovation in search of their own distinct offering. Even though the domestic markets would largely suffice, they’ve shown global ambition and trail-blazed the path for other institutions in the region. CEIBS itself has proved its global reach and ambition, with campuses in Shanghai, Beijing, Shenzhen, Ghana, and Europe.

            In the knowledge-driven economy, innovation is fundamental to fostering sustainable development and progress. ?And if there is any advantage to the uncertain and volatile environment we’ve found ourselves to operate in, it’s that it constitutes a fertile ground for high-potential opportunities. Innovation leads us back to the essence of being human – our ability to conceive ideas and entities never before seen or even dreamed of.

            CEIBS and the EFMD will continue [their] efforts to contribute to the quality improvement of management development institutions worldwide, so they can actively support the development of knowledge economy, innovation, entrepreneurship as well as effective and sustainable business solutions.

            In these difficult times for the world economy and the world itself where threats and management through Twitter and post-truth statements have become common (I don't need to elaborate more, right?), China and Europe more than ever should get closer and create a favourable environment to innovation, growth and mutual understanding. No doubt that CEIBS is an instrument of this cooperation and I am convinced has a very important role to play, just like in 1984."

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