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ITOCHU's Focus on China

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By focusing in particular on what it sees as the most important market in Asia, ITOCHU Corporation has been actively engaged in business in China. For instance, it has been expanding trading and investment in local businesses through alliances with key local companies.
In addition to participating in infrastructure construction and the nation’s major projects, ITOCHU Corporation has been making significant contributions to the local economy by offering management consulting for local companies and other services.
ITOCHU Corporation is committed to expanding its businesses in China, which became a major economic power in name and fact after the successful hosting of the Beijing Olympics in 2008.

Establishing Strategic Foundations in China's Burgeoning Consumer Market

Focusing Consistently on China has Made Us the Country's Strongest Trading Company

Based on the conviction that, when diplomatic relations were restored, China's market would undoubtedly become a major source of trade, we made a variety of preparations to enter the market. In March 1972?half a year before the normalization of Sino-Japanese diplomatic relations?we became the first major general trading company to resume trade between Japan and China by obtaining formal ratification from China's State Council. Since then, we have steadily built our foothold in China's market by tirelessly pioneering new areas. In 1979, we opened a representative office in Beijing; in 1992, we established a trading subsidiary in Shanghai; in 1993, we obtained approval for an umbrella company; and in 2005, we obtained approval for a multinational company regional headquarters.

As a result of continuously concentrating management resources on China, we have developed one of the largest networks of bases among major general trading companies. Other consequent competitive advantages include an extensive network of personal contacts, alliances with major companies, and numerous personnel with extensive knowledge of China. Our present position as China's most powerful trading company is the fruit of such far-sightedness and a consistent emphasis on China.

Milestones of ITOCHU's Engagement with China

1972
First major trading company to obtain ratification for the resumption of Sino-Japanese trade
1979
First major trading company to establish a representative office in Beijing
1992
First major trading company to establish local trading subsidiary in Shanghai
1993
First major trading company to acquire approval for an umbrella company
2005
First major trading company to acquire approval for a multinational company regional headquarters

ITOCHU's Strengths

  • Creation of one of the largest networks of bases among major trading companies
    (seven local trading subsidiaries, six local trading sub-subsidiaries, four headquarters representative offices)
  • Breadth of personal contacts network
  • Close alliances with major local companies
  • Insight and channels in relation to China
    (procurement sources, sales channels, risk management know-how)
  • Large number of personnel with business expertise relating to China

Building Collaborative Relationships with Major Companies in the Consumer-Related Sector

Establishing Strategic Foundations with a View to Growth in Domestic Demand

The simultaneous worldwide recession has significantly affected China's exporting sector. However, economic stimulus measures that include proactive investment in infrastructure are likely to produce economic growth fueled by domestic demand. We believe that China will certainly be a driver of the global economy recovery. Although until now China's economy has grown on the back of exports, in our view heavier domestic demand will become the growth driver. ITOCHU has always analyzed and forecast structural changes in industries from a medium-to-long perspective and moved forward with farsighted initiatives accordingly. In response to the structural transformation of China's economy from growth thus far as “the world's factory” toward growth as a huge consumer market, we are steadily establishing stepping stones for future growth. Such initiatives include large-scale investments in the Consumer-Related Sector, in which we enjoyed particular strength, in fiscal 2009. Through these investments we have established partnerships with major companies, which are explained on the next page. Also, we are decisively pursuing business opportunities in China's interior, which has large growth potential. In addition to such coastal regions as the Yangtze delta, the Zhuhai delta, and Bohai Bay region, we are stepping up initiatives in the three north-eastern provinces and in the mid-western regions of China. Furthermore, not only are we going to develop our partnerships with major companies within China, we are also looking to develop these partnerships globally.

Projects

Strengthening Our Partnership with the Ting Hsin Group
We have invested in Ting Hsin (Cayman Islands) Holding Corp, which is the holding company for the Ting Hsin Group, a major food and distribution company in China and Taiwan.
Initiatives with strong Chinese partners
Accelerating business operations in the enormous Chinese market through strategic partnerships with leading local companies
Logistics in China
Our logistics services utilize a distribution network that covers the whole of China.
Comprehensive Business Ties with Liaoning Chengda
Comprehensive Business Ties among Liaoning Chengda, ITOCHU, and Alfresa Holdings.

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