On December 18-19, 2024, the "2024 Global Globalization Forum • Shanghai" (GGF2024 Shanghai) hosted by EqualOcean, a new think tank for global globalization, came to a successful conclusion in Xuhui District, Shanghai. The conference will last for two days and one night, with a total of four full day global forums: Leaders Forum, Brand Global Forum, Overseas Insight Forum, and Emerging Industry Global Forum. 107 guests, 100 award-winning institutions, and over 3000 attendees will join forces to expand globalization, strive for "true" global expansion, and create a new chapter in global expansion in 2025.
On December 19th, during the "Overseas Insight Forum" roundtable discussion on "Latin America - Don't Just Look at Mexico", Zhang Zhibin, Head of Overseas Investment at Jiacheng Capital, Cao Ting, Deputy Director of the Latin America Research Office at Fudan University's Institute of International Studies, Ruan Fei, Head of Overseas Investment at Nichu Capital, and Wang Pei, Executive Director of Global Services for Chinese Enterprises at Gao Li International, participated as roundtable guests. Zhu Minhao, former Had of Tiendamia's China Overseas Business, presided over the roundtable discussion. The following are the speeches of the roundtable guests.
Zhang Zhibin: The digitalization wave in Latin America brings investment opportunities and new business experiences
Zhang Zhibin, Head of Overseas Investment at Jiacheng Capital, focuses on early investment opportunities in areas such as artificial intelligence, robotics, and new energy. Jiacheng Capital Next Capital was established in 2017 and is an early-stage investment fund focused on the technology sector. As the first money for innovators, we strongly believe in technology driven business innovation and work together with highly potential future technology leaders to unlock the future. Jiacheng Capital's investments cover fields such as artificial intelligence, hard technology, digital healthcare and health, technology globalization, biotechnology and life sciences, new energy, and robotics. Investment cases include Yuanqi Forest, silicon-based biomimetics, Dianjiang Technology, Panda Speed, Walnut Technology, Olive Branch Health Singularity Data、 Multiple technology innovation companies such as Weiming Shiguang, Shize Biotechnology, Hesheng Technology, Lianyu Technology, Shize Biotechnology, and Xinsu Technology. Jiacheng Capital is a partner for innovators to think and grow.
Mr. Zhang shared the situation of the Mexican and Brazilian markets.
Mexico has benefited from recent geopolitical changes and attracted investments from China, Europe, the Middle East, and other regions; In the process of undertaking the fuel vehicle manufacturing industry cluster in the past, the country has polished a relatively complete industrial service system, but the industrial categories are still relatively single. In the long run, there are opportunities for domestic advantageous manufacturing industries to go global.
Brazil is a strong and culturally open immigrant country in Latin America, with obvious advantages in agriculture and mineral resources. Previously, Brazil focused on developing finance and had high-end industrial capabilities such as aircraft manufacturing, but its basic industry was weak. A large number of light industrial products came from China, and offline consumption was prosperous. The e-commerce industry developed rapidly, and Chinese funded e-commerce platforms competed with companies such as Meikeduo and Amazon, driving the development of e-commerce software, logistics and other industries.
He then elaborated on investment opportunities in the digital field in Latin America. The Latin American cloud market is growing rapidly, with Chinese companies such as Huawei and Alibaba beginning to make efforts. Latin American companies have excellent payment habits and an open attitude towards cloud services.
In the financial field, the high base interest rates in Latin America have created significant development space for financial businesses. Many domestic and foreign enterprises have engaged in financial business, and local fintech unicorns have also emerged.
The e-commerce industry has undergone significant changes. Taking Brazil as an example, there is still significant growth potential in its e-commerce market. Emerging companies are using price positioning strategies to increase order volume, while also creating moats through self built or bundled logistics.
Finally, Mr. Zhang talked about the explosive growth of Chinese enterprises going global to Latin America in the past two years, and various industries are actively exploring business development and growth methods tailored to the characteristics of the Latin American market. Latin America is full of opportunities, but the Chinese model cannot dominate the world. We must attach importance to local enterprises, respect local culture, and emphasize that Chinese enterprises need to be prepared for a long-term war when going global. We need to view our overseas business from a more macro and long-term perspective, because although the trend of globalization may fluctuate, it is generally irreversible.
Cao Ting: The Latin American economy is lukewarm, and there are opportunities and risks for enterprises to go abroad
Cao Ting, Deputy Director of the Latin American Research Office at the Institute of International Studies, Fudan University, has been engaged in Latin American research work. He tracks the political, economic, diplomatic and other situations of Latin American countries on a daily basis, writes a large number of internal reports for the central government's decision-making on Latin American work, and has published numerous academic articles in domestic core and important journals such as "International Issues Research", "Modern International Relations", "Peace and Development", and "Latin American Studies". Actively participate in foreign affairs exchanges and have visited Latin American countries such as Brazil, Mexico, Chile, and Peru multiple times as a member of the delegation. Previously interviewed by well-known domestic media such as China Radio International, currently serving as a director of the China Latin American History Society and the Secretary General of the External Communication Subcommittee of the Western Portuguese Latin American Branch of the European and American Alumni Association.
Ms. Cao emphasized the economic and political situation in Latin America and its impact on Chinese enterprises. She pointed out that the economic growth in Latin America is showing a lukewarm trend, with a growth rate of 2.2% this year. At the specific national level, Brazil provides preferential conditions for foreign companies to invest in high value-added and high-tech fields, such as BYD having set up factories in Brazil to produce electric vehicle components; Mexico, Chile, Colombia and other countries attach great importance to the development of green economy, and industries such as photovoltaics, wind power, and filtration are facing development opportunities.
However, the Latin American region also faces many challenges. In terms of inflation, the situation will be more severe in 2023, with Argentina's annual inflation rate reaching 118% and Venezuela's reaching 60%, which will lead to asset depreciation and increased costs for businesses. In terms of social unrest, the security situation in some countries such as Ecuador and Chile has deteriorated, and the refugee problem in Venezuela has also affected the stability of neighboring countries. The social and political polarization in some countries has intensified, and activities such as public protests and road closures have disrupted the production and operation of enterprises.
In response to these situations, Ms. Cao has proposed a series of strategies for Chinese companies to expand into the Latin American market. She suggested that companies should carefully research the development strategies and plans of Latin American governments, closely track the political and economic situation of relevant countries, and fully consider the risks of political instability and social instability. Deeply understand the local tax and legal system, respect local culture and living habits, and make reasonable use of local resources and labor force; Actively communicate with local governments and communities. Given that some Latin American countries implement federal systems and local governments have greater power, businesses need to fully understand their needs and demands in order to better integrate into the local market.
Ruan Fei: The scale of the Latin American market is considerable, and Chinese brands need to go deep into the local market to go global
Ruan Fei, Head of Overseas Investment at Nicho Capital. Ruan Fei has over 10 years of early investment experience in the primary market, having worked at Innovation Works and Fosun Ruizheng. For more than 10 years, he has focused on cross-border overseas markets and has invested in companies such as Zhongli Corporation and Yuanding Intelligent Uniuni、voila、 Daewoo Unlimited and other projects. At the beginning of the day, the capital was founded by Mr. Chen Feng, a serial entrepreneur and a senior investor. It was founded in Shenzhen in 2020. In August 2021, it completed the fundraising of a phase I US dollar fund with a total size of 630 million US dollars. The main LPs include the world's top sovereign funds, leading Chinese Internet enterprises, family offices, etc. Nicho Capital adheres to a full cycle investment strategy of "specialization, scarcity, depth, and longevity", focusing on in-depth research and industrial strategies, and making long-term deep value investments in a few core parts of the consumer industry chain. The main focus of the current initial capital is on overseas investment and early investment in the consumer industry. We focus on challengers in the competitive and excellent industries, as well as hidden champions in segmented industries and innovators in new categories. In the early stages, we captured projects such as Hesheng Innovation, Haote Sell, Curiosity Technology, and participated in investments in many excellent brand companies such as Castlery, Bubble Mart, Heytea, WonderLab, COMMUNE Commune, Guotai Liquor Industry, Juzi Biotechnology, Ideal Automobile, Nezha Automobile, etc.
Mr. Ruan believes that Latin America can serve as a springboard for Chinese companies to enter developed country markets, and pays attention to its role as a potential tariff depression country. Chinese companies need to seek more supply chains and avoid tariff risks locally.
He mentioned that the Latin American market used to be a scarce market for high-quality products, while Chinese products had a higher markup rate locally. After the epidemic, the penetration rate of e-commerce in Latin America has increased, such as the growth of the number of Chinese people in Mexico, and there are still opportunities for distribution oriented e-commerce in the e-commerce market.
However, the overall recognition of Chinese brands in Latin America is relatively low, and except for a few brands, most companies are still on the road to branding. Brand building faces many challenges, requiring a deep understanding of local consumer needs and avoiding applying Chinese market experience directly to the Latin American market, otherwise it is easy to fall into the dumping trap. Instead, localization should be done well, products should be adjusted according to local needs, and brand premium ability should be enhanced.
Wang Pei: There are many challenges in going global to Latin America, and we adhere to a long-term approach to seek development
Wang Pei, Executive Director of Gaoli International, is mainly responsible for leading team members to provide one-stop real estate solutions to enterprises both domestically and internationally. His industrial clients include finance, technology and communication, new energy and new materials, medical devices, and semiconductors. With over 12 years of experience in enterprise overseas services, we have assisted numerous well-known Chinese industrial enterprises and European and American multinational corporations in finding customized real estate solutions, covering domestic, Asia Pacific, American, Middle East, Europe, and North Africa, while actively participating in various ESG sustainable development activities.
In terms of the challenges faced in going global, Mr. Wang believes that geopolitics is the primary factor that companies need to consider when investing overseas. Its uncertainty has a huge impact, and companies need to clarify their investment attributes, consider customer markets, and the possible geopolitical and tariff impacts they may face. In terms of language, Spanish is commonly used in Latin America, and English is not widely spoken. Having Spanish speaking partners or local partners and colleagues is extremely important for promoting business. In terms of labor and material site selection, China's labor output is good, but Latin America's material supply is limited. Enterprises should be cautious in site selection and pay attention to negotiation strategies. In addition, the efficiency of law enforcement by Latin American governments may bring hidden costs, and seeking local partners when registering a company can avoid some risks.
Regarding the pitfalls and advice that Chinese companies often step into when going global, Mr. Wang emphasized that Chinese companies should focus on telling their own and corporate stories when going global, seize the opportunities of Chinese culture going global, enhance brand premium, provide good products and services, and attach importance to brand, talent diversification, and social responsibility. Moreover, enterprises should adopt a more inclusive attitude when going global, diversify their overseas employment, and accommodate groups such as people with disabilities. This will help to obtain government returns, establish brand image, and enhance social responsibility.
Finally, Mr. Wang summarized the situation of going global to Latin America in 2024 with a "long-term perspective" and believed that the Latin American market is a blue ocean. He suggested that companies consider the demands of the South American market, their own resources, and the contributions they can make to the market before going global. He hopes that 2025 will become an important milestone for the internationalization of companies and encourages them to actively pursue their ambitions on the path of internationalization.
Regarding the "Global Globalization Hundred People Association" (GGC100)
Since starting from within EO in 2018, EqualOcean has officially launched the "GoGlobal Committee of 100" (GGC100) at the "2023 Globalization Summit" (ESG2023) held in Shenzhen in June 2023. GGC100 is an organization jointly initiated by EqualOcean and hundreds of well-known entrepreneurs, investors, and scholars. From "gathering a hundred people" to "going to a thousand people together", from "dialogue industry" to "empowering the world". The "Hundred Talents Association" gathers elite members from all over the world, with the aim of serving Chinese enterprises' global expansion, and holds the "GoGlobal Forum of 100" (GGF) to complement the "Global Globalization Hundred Talents Association".
As of now, the GGC100 Global 100 has gathered over 500 elite members from overseas globalization, 1600 executives from overseas enterprises to share insights, and 20000 precise overseas globalization communities, covering industries including but not limited to new energy AI、 Fast selling products and catering cover the entire industry, with a total market value of 10 trillion yuan. The company has held 8 thousand person conferences, more than 20 industry salons, more than 10 elite events, and multiple study tours.
About the Global Global Hundred Forum (GGF)
The GoGlobal Forum of 100 (GGF) is hosted by EqualOcean and the Global 100, and is held annually in Shenzhen in June and Shanghai in December. Each conference lasts for 2-3 days and attracts over 2500 attendees, with approximately 70% being directors. It is the largest and most anticipated industry gathering in the field of global globalization. Welcome to contact EqualOcean staff to learn about cooperation methods.
About EqualOcean
EqualOcean is a new type of think tank and core resource linker that focuses on serving Chinese companies' global expansion and helping overseas companies or institutions seize development opportunities in China. With the mission of "connecting China and the world", our core advantages are having the strongest team in the industry, connecting the official and private sectors, connecting the technology Internet and "traditional industries", having a global vision and a global resource network. Established in November 2018, EqualOcean currently has products such as the New Overseas Research Institute, New Overseas Academy, Overseas Globalization Hundred People Association, Media Activities, and Huang Yuanpu Channel. It provides in-depth reporting and analysis in both Chinese and English, global strategy consulting, overseas market research, overseas benchmark study camps, overseas study tours, overseas conferences, and overseas closed door meetings. In 2024, the EqualOcean team also published a book called "New Overseas Wave", which sold 100000 copies.
EqualOcean Chinese website: https://cn.equalocean.com/
EqualOcean English website: https://equalocean.com/