Bank Of East Asia Ltd. · HKEX:23
Bank Of East Asia — The Bank of East Asia — Investor Presentation (September 2021)
15 slides from Bank Of East Asia's investor presentation, Sep 17, 2021
Slide 1: A German Lesson for China's Manufacturing Sector
A German Lesson for China’s Manufacturing Sector Economic Research Department 17 September 2021 Prepared by The Bank of East Asia, Limited 由東亞銀⾏有限公司編寫
Slide 2: China seeks to maintain a balanced GDP profile
China seeks to maintain a balanced GDP profile China’s services output has outgrown its China now looking for a more balanced industrial sector since 2012 economic structure China's Share of GDP by Industry 60% Services sector already large enough 54.5% 50% While the services sector is important to
Slide 3: China is driving advanced manufacturing
China is driving advanced manufacturing Official shift in tone about Why advanced manufacturing is economic structure a key matter of urgency “The value-added of the tertiary industry US-China tensions accounted for a larger share of the Geopolitical tension is expected to continue in the medium to
Slide 4: Germany serves as a possible model for China
Germany serves as a possible model for China Advanced manufacturing has long been a key Some characteristics of the German economy strength of the German economy Manufacturing and Services Sector to GDP Ratio (%) 90 77.3 80 66.8 72.8 Strong vocational training 70 63.6 60 54.5 50 40 30 26.2 20 17.8 1
Slide 5: Vocational training is a viable education path in Germany
Vocational training is a viable education path in Germany Low share of university graduates, as many young people choose vocational education Dual-track vocational education training Share of population aged 25-34 with tertiary education 70 Standardised training programme 61.5 The Vocational Trainin
Slide 6: China's manufacturing sector faces a skills shortage
Meanwhile, China’s manufacturing sector faces a skills shortage Coastal factories are reporting difficulties in Recent college grads are unsuited or unwilling recruiting skilled workers to go into manufacturing 22 million 19.6% Currently, China is short of 22 million skilled Unemployment rate for de
Slide 7: China is promoting vocational education
China is promoting vocational education Chinese President Xi Jinping (April 2021): “Promote bachelor-level vocational education and bring about a number of quality vocational education institutions and programmes.” “Cultivate more high-quality technical professionals.” German vocational training mod
Slide 8: German model in fostering innovation – Mittelstand firms
German model in fostering innovation – Mittelstand firms Mittelstand – the backbone of Germany’s manufacturing sector • Mittelstand are small and medium-sized enterprises, with annual revenue of up to €50 million and less than 500 employees. • Usually family-owned firms; considered flexible, highly
Slide 9: China is now seeking to grow SMEs into "little giants"
China is now seeking to grow SMEs into “little giants” Helping manufacturers to be homegrown champions of innovation China targets Mittelstand firms for acquisitions • In 2014-20, there were 300 Chinese acquisitions of German companies, including many Mittelstand firms. Nurture small and medium-size
Slide 10: Germany has a bank-dominated financial sector
Germany has a bank-dominated financial sector Germany is light in finance and heavy in manufacturing Financial services represent a low share of GDP Equity market less developed Germany’s value of financial services was 3.9% of GDP Germany’s financial system is dominated by banks. (2020), compared w
Slide 11: 3 pillars of the German banking system
3 pillars of the German banking system Germany’s 3-pillar banking system With a less developed capital market, corporate finance is largely provided in the form of bank loans. The banking sector is mainly comprised of (1) private commercial banks, (2) public sector banks, and (3) cooperative banks.
Slide 12: German banks emphasise stability & long-term relationships
German banks emphasise stability & long-term relationships Pros and cons of Germany’s financial system PROS CONS Long-term relationship between firms & banks Lower profitability for banks • Companies typically rely on their house bank for financing. • Since most banks have a social mission, they are
Slide 13: China beginning to address the challenge of financing SMEs
China beginning to address the challenge of financing SMEs Germany’s financial system as a guide for helping SMEs China’s large banks more inclined toward property lending China trying to develop more Share of property loans lent by large banks fundraising platforms for SMEs 100% 70% • A new stock e
Slide 14: Disclaimer
Disclaimer This document is prepared by The Bank of East Asia, Limited (“BEA”) for customer reference only. Other than disclosures relating to BEA, the content is based on information available to the public and reasonably believed to be reliable, but has not been independently verified. Any project
Slide 15: Thank You
Thank You For further information please contact the Economic Research Department Celia Lam Annie Wong LAMCYH1@hkbea.com WONGAYK@hkbea.com 3609 1542 3609 1534 Prepared by The Bank of East Asia, Limited 由東亞銀⾏有限公司編寫
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