Expo Asia Show Special

Global Marketplace Expanding Into China
The door to China is now open, and it's time to start understanding the potential for marketing and sourcing of raw materials here," says Matthew Cheng, director of marketing for Healing Plants Inc., a Hong Kong-based manufacturer of finished botanical products.

With China's recent entry into the World Trade Organisation (WTO), and with the Chinese State Drug Administration (SDA) and Ministry of Health (MOH) expected to revamp the country's regulatory standards for health products within the next three years, China will at last be competitive in the global marketplace.

"China is loosening up around its regulatory standards as it recognises the use of dietary supplements in the West," says Cheng.

One of the goals of Natural Products Expo Asia, the first global nutrition trade show in Asia, is to showcase the best materials (China produces nearly 13,000 raw materials), practices and technologies that China has to offer to suppliers and manufacturers and to provide a platform for education and business exchange.

A key issue for Western manufacturers of herbs and dietary supplements involves regulatory roadblocks. Until China's regulations change, many suppliers and manufacturers will not be able to provide the documentation necessary to support their ingredients for the level of safety that China now requires. Because China considers herbs to be medicines rather than dietary supplements, the government requires toxicity and stability tests comparable to those found in the Western pharmaceutical industry. Thus, Cheng cautions, some companies could discover that products they wish to sell in China may require reformulation to meet regulatory standards.

However, suppliers and manufacturers will learn that because TCM has been practiced in China for thousands of years, there is a mature infrastructure for clinical practices, business networks, extraction technology, research, marketing strategies, sales, exporting and re-importing strategies, and less-costly production capabilities.

Quality consistency of Chinese raw materials entering the West is also a concern for manufacturers. Small Chinese raw materials suppliers often have advanced technology to meet quality standards but may not have the resources to market themselves globally.

Business Is Booming In Asia
The Asian nutritional supplements market is booming right now, according to the US Department of Commerce. International trade specialist Marnie Morrione says that while growth has been flat in the US, the fastest-growing market currently is Asia, with its growing incomes and population.

"Though China and Hong Kong have a strong tradition and expertise in Chinese medicine, the region has lagged behind in development and technology of evidence-based modern supplements," she says. "As Chinese living standards improve, foreign nutritional foods are expected to enjoy an annual growth rate of 20 per cent or more in the years to come."

The Chinese nutritional supplements market is currently worth $3.63 billion but is set to increase to more than $10 billion by 2010. Chinese consumers want products with curative and health-enhancing effects, according to Morrione.

"The improving living standards in China have spurred rapid development of the supplements market," she notes.

In other Asian markets, sales are also on the increase. In Singapore, the supplements market is estimated at $20.4 million, with a growth rate of approximately five per cent annually. The majority of supplements sold are imported, primarily from the Netherlands and Switzerland. Japan is one of the largest supplements markets in the world, with a growth rate of six per cent in 2001.

Expo Asia Conference Info

WHEN: May 15-18, 2002
WHERE: Hong Kong Convention & Exhibition Centre, Wanchai, Hong Kong
CONTACT: www.naturalproductsasia.com
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