Private firms push forward arboad

"Going global is more for Chinese companies to participate in international competition, to find target markets in an overseas environment and get to know that market."

Xu, who spends two-thirds of his time abroad and works on behalf of the government advising Chinese companies about their overseas efforts, says the main problem with trying to achieve costs savings by establishing bases abroad is that Chinese manufacturing is among the most efficient in the world.

"From our own experience, if you invest in Southeast Asia the overall efficiency level is around a third of that in China. Companies from other countries are also trying to move to these locations so there is a lot of competition for resources."

In the conference room of his offices on the 16th floor of International Trade Tower on Suzhou's Xihuan Road, Wang Zhiming, vice-director of the Suzhou Bureau of Commerce, says the local private businesses are not afraid of going abroad since they have had long exposure to multinational businesses.

Nearly 300 sq km of the city is taken up by the Suzhou Singapore Industrial Park, which has attracted more than 3,000 foreign enterprises, including 77 Fortune 500 multinationals.

"The so-called Suzhou model for development was on foreign companies coming and investing in the various development zones around the city. That is how the city's regeneration began 30 years ago.

"Many of our private businesses grew up supplying to foreign companies on these zones. There are also export processing centers there."

Wang says many local businesses are now keen to make overseas acquisitions in their own right and there is no shortage of suitors. The bureau holds around six seminars a year from investment promotion agencies from the US, Sweden, the UK and Japan.

"One of the main problems for companies going abroad is the lack of information and these seminars provide information on investment opportunities. They are very much open to the idea of Chinese investment coming in even though there has perhaps been resistance to it in the past," Wang says. "We definitely want to encourage more business to also export and I think that transformation is happening now."

The ambitions of some Suzhou entrepreneurs go way beyond mere exporting, however.

Lu Qiyuan, president of the Jiangsu Qiyuan Group, used to be just a steel pipe maker but he now has bigger ideas.

The 48-year-old proudly shows a model of a $1 billion development he is planning to build in Addis Ababa.

If it goes ahead, it will feature a shopping mall, a five-star hotel and a major residential housing scheme on a 500,000 sq meter site.

He makes no apology that it will be a somewhat futuristic addition to the existing architectural lexicon of the Ethiopian capital.

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