As an important part of the market economy, industry associations are playing a more and more important role in economic cooperation and in international trade. They serve as a bridge between the government, businesses and the market. As the role of the government changes, as industry resources are being consolidated and as the management system of market economy and macro-economic regulation are being improved, industry associations have an irreplaceable role to play. In developed countries, in particular European countries and the US, intermediaries like chambers of commerce and industry associations were established rather early and are mature nowadays. And they play a vital role in economic and trade policies, and even in political decision?-making. Therefore, in international exchanges and economic cooperation, industry associations should take the lead in tapping international markets and coordinating with competing companies. This is in keeping with the current momentum in international economic relations and can contribute to the development of solid and mature cooperation models.

 

The Metal Enterprises Union of Jieyang gathered the needs of the local metals industry. And after careful deliberations and planning, it set up its own industry fund based on voluntary contributions, the first of its kind in China. It raised up to one billion yuan(RMB) in the first attempt, laying a solid foundation for comprehensively promoting international cooperation.

 

To help local metals industry comprehensively upgrade itself, the Union looked for ways to work with Germany, a manufacturing powerhouse. Its efforts to expand foreign markets for local companies are similar to the approach of mature German industry associations. The Union organized groups of local businessmen to visit Germany and they had in-depth and frequent discussions with their German counterparts regarding cooperation. The two sides found that both would benefit if steps were taken to combine the management, technologies and human resource development of Germany with the strong capacity and huge market potential in the metals industry of Jieyang.

 

Based on the principle of mutual benefit and win-win cooperation, the Union made good use of international resources, and expanded all kinds of channels for attracting foreign investors. Thanks to its diverse, flexible models, the Union conducted practical cooperation in many areas with over 10 European industry associations, including the German Chamber of Commerce (GCC), the Steiger Fund, the VBW, and the Stiftung Familienunternehmen. This made it much easier for local companies to joint hands with their foreign counterparts.

 

The cooperation model driven by the Union was well-acclaimed by the German government and business community. Eric Schweitzer, Chairman of GCC said: “The Metal Enterprises Union of Jieyang is driving the Sino-German Metal Eco City project, and the government provides strong structural and political support. This is very much similar to how we deal with the relations between the government and the market in Germany-GCC represents both the government and the interests of companies and we have good relations with the Federal government, which makes it much smoother for us to go about our business”.

 

Good cooperation with major associations in Germany also promoted government to government relations. Philip Missfelder, member of the board of directors of the Christian Democratic Union and chairman of the Junge Union, and Berlin mayor Klaus Wowereit led high-level business delegations to visit Guangdong Province. Both of them came to the Metal Enterprises Union of Jieyang to have discussions and sought to push forward political and economic cooperation between the two sides.

II. Building a Large Platform to Attract Foreign Investments

In addition to good channels for international cooperation, the Metal Enterprises Union of Jieyang established a physical platform-the Sino-German Metal Eco City, an industrial park in Guangdong with a particular focus on innovation. The Eco City is run with a new approach-it is led by the committee of the Communist Party of China, and gets guidance from the government. The Metal Enterprises Union of Jieyang is the main driver of the project, and companies the main players, with everything being decided by the market. After two years of hard work, the Union coordinated and drove forward many projects in the Eco City, including the establishment of five innovative service centers, the first electro-plating park in China that has zero emissions, the Sino-German Innovation Center that aims to help with industrial upgrading, full-fledged living quarters for employees and business areas, as well as an eco-friendly forest park.

 

The Sino-German Metal Eco City project received strong support from senior officials. Hu Chunhua, Secretary of Guangdong Provincial CPC Committee, and Governor Zhu Xiaodan paid visits to construction sites in the Eco City. They made it clear that the project should serve as an important platform for cooperation between Guangdong Province and Germany, and that it should become a key pilot project where new management systems, new ways of international cooperation and new models in upgrading traditional industries are tried out. In August 2014, during the second dialogue on sustainable development between the Communist Party of China and the Social Democratic Party of Germany (SPD), Mr. Torsten Sch fer-Gümbel, Vice-Chairman of the SPD and other delegates expressed their support for making the Sino-German Metal Eco City a testing ground for Sino-German cooperation on a new type of urbanization.

 

Thanks to the efforts of the Union and the political and business communities in both countries, the Sino-German Metal Eco City is now working with German industry zone management organizations, institutions of higher education, and research institutes in many areas. It is introducing advanced management expertise, technologies and human resources from German to build a mega-platform for bilateral cooperation, and to integrate international resources effectively. WISTA-Management GMBH, operator of the Adlershof Science and Technology Park and the Humboldt University of Berlin are going to establish their presence in the Eco City and work together to develop it. The aim is to comprehensively build up the Eco City’s capabilities in planning and management, to establish a Sino-German Incubator and to set up platforms for the relocation of industries and the incubation of innovations in science and technology. Meanwhile, the Esslingen University is going to work with the Metal Enterprises Union of Jieyang to establish a dual-system university of applied sciences, which will produce highly skilled professionals trained under the German vocational education model for the Eco City, Jieyang City and the entire Guangdong Province. Six European research institutes including the Fraunhofer Institute for Production Technology will work with the Eco City to jointly develop a Metals Technology Center and a Platform for the Trading of Research Results. These will facilitate the commercialization and transfer of advanced foreign technologies and equipment within the Eco City. 18 companies have signed contracts to set up shop in the Sino-German Metal Eco City. These include the ALBA Group, the largest German company in the field of environment protection, Ferdinand Menrad GmbH, and ASANUS Medizintechnik GmbH.

III. Regular Contacts, and New Areas for Cooperation

To cement the good cooperation relations between China and Germany, the Metal Enterprises Union of Jieyang has opened a total of six European offices in Munich, Berlin, Stuttgart and Frankfurt, Dusseldorf and Dresden. And the German Headquarter of Zhongde Metal Group was established in Stuttgart. These aim to serve as an important channel for strengthening Sino-German cooperation and expanding areas of cooperation so that there are regular contacts linking Jieyang with Germany and other European countries.

 

Dieter Hundt, former Chairman of the Confederation of German Employers’ Associations said that he will take advantages his connections in Germany and work closely with the German offices of the Zhongde Metal Group to support the marketing campaign of the Sino-German Metal Eco City and its efforts to attract investment in the German market so that the Eco City project will be well-known in Germany and more outstanding German companies can set up offices in the Eco City.

 

As cooperation with German partners becomes more and more mature, efforts are being made to give more content to bilateral cooperation on the cultural front. The Metal Enterprises Union of Jieyang helped the Zhongde Metal Group sign a deal with a strong German basketball team, ALBA Berlin, to advertise its logo during the team’s activities. The deal made the Group the main Chinese sponsor of ALBA Berlin. This move not only promotes the global image of the Zhongde Metal Group, but also makes companies from Jieyang more recognizable in Europe.

 

Dr. Axel Schweitzer, supervisor of ALBA Berlin, remarked that this cooperation contributes to the cultural bridge between China and Germany.

 

Ma Guangyuan, a renowned economist pointed out that in the Sino-German Metal Eco City project, the government is an advisor, industry associations the director, the market the playwright and companies the actors. The new model allows the market to play a decisive role and the government a better role. And it could possibly become a classic example in the upgrading of traditional industries in China.

 

Thanks to the support and guidance from all sides and its own firm and unremitting strides, the Metal Enterprises Union of Jieyang has went from a layman to become a ‘seasoned director’ and is working with industry associations in Germany to build a full-service platform for cooperation and exchanges. Owing to the support of the political leaders and the business community in the two countries, the first Sino-German SMEs Cooperation Fair will be held in Jieyang in 2015. It is hoped that the fair can be held annually in the Sino-German Metal Eco City to facilitate cooperation between SMEs in the two countries so that the Chinese market can be perfectly matched with German technologies, and Chinese efficiency with German quality. This year’s fair will witness the launch of four ‘100’ projects, namely, to help more than 100 Chinese and German SMEs become partners; to hire more than 100 retired German engineers as senior advisors; to help display, transfer or commercialize more than 100 German high?-tech and new-tech research results and advanced equipment in China; and to set up a Sino-German SME Cooperation Fund with a capital of 10 billion RMB(100 Yi in Chinese). These initiatives will boost China-Germany cooperation in all areas, including business, S&T, management, human resource, finance and culture. The Metal Enterprises Union of Jieyang offers a new approach in international cooperation where industry associations serve as a bridge of people to people exchanges, and promote two-way cooperation - the international outreach of Chinese firms and inbound investment by foreign companies. And the Union is now striving to become a pioneer in the new wave of high-level, comprehensive cooperation between China and Germany.

 

         (This article is contributed by the Metal Enterprises Union of Jieyang, Guangdong. The chairman of the Union, Mr. Wu Kedong, is council member of CAFIU.)