11

Printing Industry in Printing Industry in ChinaChina

Present & FuturePresent & FutureCharlesCharles Lo Lo

Print 05Print 05

ChicagoChicago

22

Figures of Interest from 2004Figures of Interest from 2004

No. of printing companies: 94,282 No. of printing companies: 94,282 (1893 more than 2003)(1893 more than 2003)

No. of employees: over 3 millionNo. of employees: over 3 million

Total printing shipments: USD 34 Total printing shipments: USD 34 billionbillion

33

Printing Industry Worldwide : 2004Printing Industry Worldwide : 2004

G-5

• US USD 161 Billion per capita $570

• Japan 75 590

• Germany 20 250

• UK 25 416

• France 24 400

• China 34 20.7

44

China’s Total Printing China’s Total Printing Shipments : 1995-2004Shipments : 1995-2004

79

11 1214

18

2225

29

34

0

5

10

15

20

25

30

35

US$

in

billio

ns

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

55

China’s GChina’s GDP DP :: 1995-2004 1995-2004

727820

900 947 9921081

11761271

1417

1650

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

US$

in b

illio

ns

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

66

Total Printing Shipments Total Printing Shipments :: GDPGDP

1.00%1.10%

1.22% 1.27%1.41%

1.67%

1.87% 1.92% 1.97%2.06%

0%

1%

2%

% 1.00% 1.10% 1.22% 1.27% 1.41% 1.67% 1.87% 1.92% 1.97% 2.06%

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

77

China’s GDP Prediction : 2005-China’s GDP Prediction : 2005-20202020

2,260

1,9701,800

1,650

2,100

3,500

2,900

3,7003,900

4,2004,500

4,800

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

US

$ in

bill

ion

s

Billions of U.S. Dollars 1650 1800 1970 2100 2260 2900 3500 3700 3900 4200 4500 4800

2004 2005 2006 2007 2008 2010 2012 2014 2016 2018 2019 2020

88

Foreign Printers with Investments Foreign Printers with Investments in Chinain China

• R.R. Donnelley, Avery Dennison

• Toppan, Nippo, Nishiguchi

• Times Printers, SNP

• Choice, YFY

• C & C, Hung Hing, Astros, New Island, Midas, Starlight, Golden Cup, Wing King Tong, Luk Ka

99

Application RoadmapApplication Roadmap

1 Press and Publication Bureau

2 Foreign Investment Authority

3 Trade and Commerce Bureau

1010

Laws and RegulationsLaws and Regulations• The Law of the People’s Republic of China on

Enterprises with Foreign Investment• The Law of the People’s Republic of China on

Chinese-foreign Equity Joint Ventures• The Law of the People’s Republic of China on

Chinese-foreign Cooperative Enterprises• Regulations on the Administration of Printing

Industry • Interim Provisions on the Establishment of

Printing Enterprises with Foreign Investment • Interim Regulations on Basic Criteria and

Conditions of Printing Business Ownership

• (Go to www.fdi.gov.cn for the English version of these laws)

1111

The 4 Business ModelsThe 4 Business Models

• 1 Forming new joint ventures: R.R. Donnelley, C&C Beijing

• 2 Buying out existing foreign invested printers: R.R. Donnelley, SNP, Times Printers

• 3 Buying controlling shares from a local printer: Choice

• 4 Forming wholly-owned operations (packaging): Shanghai Toppan

1212

Paper Manufacturing and Paper Manufacturing and ConsumptionConsumption

43

7

5065

15

80

0

20

40

60

80

2003 2015

Production Import Consumption unit:million tons

1313

Total Printing Shipments: Total Printing Shipments: A prediction for 2010 & 2020A prediction for 2010 & 2020

2010 Low: USD 58 billion (=2% of GDP) Mid: USD 63.8 billion (=2.2% of GDP) High: USD 69.6 billion (=2.4% of GDP)

2020 Low: USD 115.2 billion (=2.4% of GDP) Mid: USD 123.4 billion (=2.6% of GDP) High: USD 144 billion (=3% of GDP)

1414

OpportunitiesOpportunities

• Strong growth of China’s economy and domestic demand

• China’s world manufacturing base status

• Government policies

• Member of WTO: since 2002

• Beijing Olympics: 2008

• Shanghai World Expo: 2001

1515

US Offshore PrintingUS Offshore Printing

1996 2000 2003 2004

Canada 435M 767M 879M 922M

China 197 348 551 677

Japan 78 115 132 119

Mexico 82 133 117 132

Germany 90 85 81 86

UK 84 85 75 81

Italy 43 55 53 50

Taiwan 33 36 50 47

HKG 47 49 40 43

France 40 57 39 33