China aims at being "brand power"

When China's leading experts in intellectual property protection and trademarks wanted to get together this month, they visited Yili Group in Hohhot, capital of Inner Mongolian Autonomous Region.

Yili is one of China's top food brands and has been officially chosen to supply dairy products for the 2008 Beijing Olympic Games.

The experts, and more than 500 officials and entrepreneurs from around the country, came for the Summit of Independent Innovation and Domestic Brand Development Strategy.

Summit spokesman Wang Kaiqian said the venue was selected because the relatively less-developed region has sharply boosted its economy with the development of leading brands.

With an income of 16.34 billion yuan (2.15 billion U.S. dollars) in 2006, Yili is aiming to become one of the world's top 10 dairy producers by 2015.

Inner Mongolia also boasts more than 20 nationally known brands of food, cashmere and other products.

Supported by the leading brands, the region has topped China's provincial areas in economic growth for the last five years.

"Inner Mongolia has set an example for the country, and their experience should be studied and disseminated for developing domestic brands," said Uyunqimg, vice-chairwoman of the Standing Committee of the National People's Congress, at the summit.

She said the national economy had been developing steadily and quickly for many years, but China was still only a "manufacturing giant", not a "brand power". To compete internationally, the country needs its own brands. With improved economic, legal and market environments, it is time to become a brand power.

As a manufacturing giant, China has made its presence in every corner of the global market with "Made in China" labels, which considerably helped boost its economy. However, the country was increasingly obsessed by trade disputes with major partners such as the European Union and the United States, who complained the flood of Chinese products killed their own industries, stole job opportunities and seriously unbalanced trade.

The latest issue was the product quality crisis spreading from the U.S. to other countries. These countries had consumed "Made in China" products for many years, but suddenly had raised "sub-standard" or "unsafe" complaints since the beginning of the year, said Uyunqimg.

Though unconvincing, they had spurred the Chinese government to consider ways to change its growth pattern, and the development of home brands was one of its latest strategies, she said.

Ai Feng, vice president of China Quality Association and an expert in trademarks and brands, said quality was at the heart of brands, and fostering brands would undoubtedly help boost product quality. "China is seeking to turn from price competition to quality competition," he said.

Last month at a national meeting on quality control, Premier Wen Jiabao called on domestic firms to improve product quality and build their own world-class brands to secure the reputation of the "Made in China" label.

Minister of Commerce Bo Xilai said the country was at the very early stage of brand development. China was top producer of more than 170 products, but had very few internationally known brands.

Less than 20 percent of exporters had their own brands, and self-owned brands accounted for no more than 10 percent of total exports.

The result was that Chinese enterprises made only humble profits by manufacturing for foreign brands. A much talked about story in China was that to buy an Airbus 380, China had to export 800 million shirts.

"To maintain the strong momentum of economic growth, 'Made in China' must become 'Created in China'," said Li Guangdou, an expert on brand development. "The future belongs to brands, especially global brands."

Government officials, experts and entrepreneurs at the summit agreed on the importance of developing brands, urging government departments to provide better legal and policy environments.

Vice Minister of Commerce Jiang Zengwei said the Ministry of Commerce had stepped up efforts to promote brand strategy, mainly involving the improvement of the brand appraisal system, protection of intellectual property rights and a brand promotion system.

Li Chuanqing, vice director of the General Administration of Quality Supervision, Inspection and Quarantine , said that since the administration launched a brand promotion committee with 64 other organizations in 2002, a large number of domestic brands had sprung up.

"So far 30 provincial regions have established brand promotion institutions, and brand development has been written into their economic development plans," Li said. "This is fairly promising."