In the context of global economic integration, the interaction and cooperation between China and Indonesia, as the two largest economies in Asia, have increasingly become the focus of international attention. Indonesia, a vast market with a population of 280 million, is currently in the second stage of industrialization. Its unique geographical location, rich demographic dividend, and vast Muslim market provide unprecedented development opportunities for Chinese entrepreneurs.
Dr. Qiu Zhenhai, founder of the Zhenhai Society, holds a PhD from the University of T ü bingen in Germany, is a renowned political commentator and scholar, expert on China’s transformation and strategic issues, a PhD from the University of T ü bingen in Germany, a senior member of the London International Institute for Strategic Studies, a former commentator for Phoenix TV, chairman of the Hong Kong Globalization Center, and host of programs such as “Zhenhai Listening to Wind” and “Global Strategy”.
Dr. Qiu once again teamed up with Mr. Chen Riling, Chairman of Wanxinda Holdings and President of the Guangdong Chamber of Commerce in Indonesia, to explore the unique charm of the Indonesian market and its potential value for Chinese companies, revealing how Chinese companies are writing new business legends on this hot land of Indonesia. Through this dialogue, we will also focus on the two-way strategy of Chinese enterprises’ “going out” and “inviting in”, explore how they can find new growth points in the global market, and how China can further consolidate its position as the main battlefield for a better life worldwide.
Dr. Qiu: “Which era is Indonesia equivalent to in China at present? What value can Indonesia bring to Chinese entrepreneurs?”
Chairman Chen Riling: “The wealth gap in Indonesia is quite large. From the perspective of Jakarta, it is about 10 to 20 years different from other cities in Indonesia, and the gap in Semarang is even greater. Guangzhou in the 1990s was almost equivalent to Semarang today. What value can Indonesia bring us as a country? I think there are mainly three aspects: first, the demographic dividend. Indonesia is a populous country with a population of 280 million, and there are about five to six million births every year, showing a high-speed growth in population; second, Indonesia is in the second round of industrialization. The first tier is Thailand, Malaysia, and Singapore, whose per capita GDP exceeds $10000; The second tier has a per capita GDP between 4800 and 10000 US dollars, while Indonesia is in the second tier in Southeast Asia with a per capita GDP of around 4800 US dollars, equivalent to China in 2010; The third is the 1.9 billion market in the Muslim world centered around Indonesia. This market is very large and can be cultivated. Indonesian manufacturing will lead to this 1.9 billion Muslim market in the future. Due to religious beliefs, this 1.9 billion market is also in a high growth state.”
Dr. Qiu: “In the past, you mentioned that ‘going global today is for the return of manufacturing industry to enterprises in ten years’. How do you understand this specifically?”
Chairman Chen Riling: “Currently, we choose to go global. Firstly, we have the ability to do so, and secondly, our production capacity has reached a certain level. For our generation born in the 1970s and 1960s, we are going out to make room for young people. For graduates or young people in China, we have sufficient experience as confidence to go global and pave the way. Currently, Chinese manufacturing is still highly competitive. When we go to Indonesia, we can cope with the current situation. Today, as we continue to go global to Indonesia, I see two points. Firstly, we are a global manufacturing service provider, and we need to continue to follow our customers well. Customers are here, and the future is here. We go out to firmly grasp the market. Secondly, we are cultivating a common market. We will explore the local market, grow together with it, cultivate its purchasing power, and make it rich, especially in Southeast Asia, the Middle East, and India. This common market is cultivated to cope with the uncertainty of the global market and diversify risks. So going out for our company is only beneficial to China, not harmful. Why did it come back? In the next decade, I believe that Chinese manufacturing will still be the world’s largest manufacturing industry. Our intelligence, our production factors, our research and development capabilities, our systematization, there is no substitute globally, and the iteration of machines has no substitute. With the rising labor costs in Southeast Asian countries such as Vietnam and Indonesia, the competitive advantage of Chinese manufacturing will reappear, and many companies will return to China at that time. In the future, the global manufacturing industry will form three main centers and two sub centers: Chinese manufacturing will continue to maintain its global leading position due to its irreplaceability; India has become the second largest manufacturing center due to its demographic dividend; Indonesia and Southeast Asia, relying on their demographic advantages and a market of 1.9 billion Muslims, are the third largest manufacturing centers; South America and Africa have become two sub centers with a certain population and low wage levels, which can meet the needs of some regions but will not affect the world.”
Dr. Qiu: “Your other point of view is to bravely go out and actively invite in. Now that Chinese companies are bravely going out, how can we understand the specific meaning of ‘actively inviting in’?”
Chairman Chen Riling: “In the current Chinese economy, people cannot help but feel a bit anxious. As entrepreneurs, we are going out and we are also inviting in. Indonesia has many good things and industries that satisfy a better life, such as coffee and bird’s nest. We need to bring them in. China is currently the safest country in the world, and we should become the main battlefield for a better life in the world. In the past, we have been to other countries in Europe and America for vacation and found that they have many social problems. Can China become a vacation destination and tourist destination that replaces Europe as the world? Our high-speed rail, our highways, our 5000 year history and culture, our intangible cultural heritage, China’s vast territory and beautiful scenery, various resources and landscapes for living in the north and south, and the bustling scenery of first tier cities like paradise… With our rich natural and cultural resources in China, we invite foreign friends to come and consume. We need to make efforts here, so how can we invite them to our tourist city? How is the construction of our friendly city going? We have many friendly city constructions around the world. Can we establish a mechanism for friendly city construction? We need to go both ways, both out and in. In addition, in the process of inviting us in, we Chinese people now live here very interconnected, and payment is very convenient. We also want foreign friends to come here in the same way. Let them feel our progress, our interconnectivity, our mobile payments, our digitization and intelligence… We need to go out and hold promotional events. Can we increase our publicity efforts under the influence of short videos such as self media videos? We need to spend money to shoot beautiful scenes of Chinese life. Today, our intelligent manufacturing and digitalization are unstoppable on the road, and our technological development will continue to move forward. In the second half of China, relying on our intangible cultural heritage, it will definitely become a global vacation destination in the next ten or twenty years.”
Through this in-depth conversation, we have gained a more comprehensive and profound understanding of the Indonesian market. Chairman Chen Riling, with his rich experience and unique insights, has revealed to us the infinite potential of Indonesia as an emerging market. From the demographic dividend to the industrialization process, and to the vast market of the Muslim world, Indonesia undoubtedly provides unprecedented development opportunities for Chinese enterprises. At the same time, we also see the courage and wisdom of Chinese enterprises in the process of globalization. They not only dare to go out and actively explore overseas markets, but also are good at inviting in high-quality resources and industries from abroad to China, promoting economic exchanges and integration between domestic and foreign countries. This two-way interactive model not only brings more development opportunities for Chinese enterprises, but also injects new vitality into the global economy. Looking ahead to the future, we believe that Chinese companies will perform even better in the Indonesian market. They will continue to uphold the concept of openness, cooperation, and win-win, work together with various sectors in Indonesia, and jointly write a new chapter of economic cooperation between the two countries. At the same time, we also look forward to more Chinese companies bravely going global, actively inviting in, and contributing more to China’s economic development.
