New Free Trade Zone to Benefit China

China's top brands could be on the road to becoming global household names after the launch of the 4.5 trillion U.S. dollars China-ASEAN Free Trade Area (CAFTA) market, the world's largest free trade zone, according to trade experts.

Despite the country being an economic powerhouse, few of its big companies have ever made a major impact on the world stage.

But if they dominate the 1.9 billion-population CAFTA, Chinese companies could build a platform from which to attack European and North American markets.

China will have made the switch from being a developing country exporting cheap goods to finally making a success of globalization.

Zhang Tianbing, founder of international management consultants AT Kearney's China Research Center in Shanghai, said China companies could move from being regional to global players.

"Chinese companies have never successfully taken advantage of globalization and this could be one of the opportunities presented by the free trade area," he said.

"If they establish dominant market positions in the region they could move on to do the same in Europe and North America. It would be a major stage in the evolution of the economy."

The China-ASEAN Free Trade Area came into being on Jan 1 with 90 percent of goods set to be tariff-free between China and Indonesia, the Philippines, Thailand, Singapore, Malaysia and Brunei.

Li Shunde, chairman of Guangyuan Tian Mei Jewelry Co, based in Guangyuan in Sichuan province, is one entrepreneur who sees the CAFTA area as a platform on which to eventually attack world markets.

"I see the ASEAN market as the first stop on the way to selling in international markets. The free trade area with its zero-tariff policy is a major opportunity for us," she said.

China's largest private car manufacturer Geely is another that expects to benefit from the free trade area.

Yu Xueliang, vice-president of Geely, has confirmed he has had discussions about setting up car manufacturing facilities in Indonesia, where it already has an assembly plant.

"Indonesia doesn't have an indigenous carmaker and the total number of vehicles produced there is just around 600,000 a year. The country has a big population and plenty of potential, however," said Yu.

"We are going to extend the scale of the plant and expand other operations there in alliance with other companies," Yu said.