In the dragon's den

As you read this, I will be immersed in the World of Photonics-China exhibition and the concurrent 9th International Laser Processing Systems and Applications Conference. I'm attending the former under the auspices of the Messe Munich International and the latter as a speaker invited by the Chinese Optical Society's Laser Processing Committee.

My China Selfie

It is important that I make periodic visits to China, which I sometimes refer to as the dragon's den, as it is arguably the single largest market for industrial laser materials processing. The Asian market, of which China is the largest member, represents almost 50% of all industrial lasers installed annually. China is such an important market for industrial laser and systems exporters that last year, when the Chinese government slowed approval of imported capital equipment, quarterly sales slipped dramatically at major European and US suppliers, causing them to report this to their investors.

Last year, a Han's Laser official reported, at the 11th International Laser Marketplace in Munich, that 2012 sales of laser processing equipment in China was in excess of $2.1 billion with 38% of that imported (down 10% due to government policy) and 62% produced domestically. That was about one-third of global system sales that year, into just one country!

Industrial Laser Solutions for Manufacturing (ILS) covers the China market internationally through our global readership and domestically through our partnership with Ringier Trade Media, which publishes Industrial Laser Solutions for Manufacturing-China in Mandarin. ILS-China features selected editorial from current ILS issues and increasing contributions from industrial laser users in China.

Currently, coverage of the economic situation in China has been making headlines in the manufacturing media with the government's induced slower growth policy as it tries to tilt the investment economy toward a consumer society. For international laser suppliers, this policy is of major concern, as some of them count on up to 40% of their exports heading to China.

Joe McDonald, AP Business Writer published on Manufacturing.net, summed the situation up nicely as being "like a captain turning a heavy ship in choppy seas."

Compounding this concern is the Chinese government's recently enacted emphasis on expanding domestic intellectual property so that domestic laser and systems manufacturers will be able to compete on a more level playing field with their international competitors.

Steven Barnett, writing in the IMF blog on imfdirect.imf.com, posits that "we should welcome the slowdown in China's economy" as it will lead to more balanced and sustainable growth. Slower growth, he suggests, will be good for China and also the world's economy because, by 2030, China will be the world's largest economy.

Thus, I will have a lot on my plate as I spend a busy week in Shanghai. I plan to meet with as many domestic laser product suppliers as possible during the exhibition. I am a strong believer in person-to-person discussions about the laser market as opposed to questionable surveys and reports that are currently flooding the Internet about the laser market in China.

David A. Belforte
belforte@pennwell.com

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