Chinese traders make Spain gateway to Europe

Hoisted from trucks and trolleys, the brown boxes keep coming, packing the warehouses with acres of jewellery, jeans and shoes. There is little sign of Spain’s economic crisis in Cobo Calleja, a vast Madrid industrial estate where the traders chatter in Chinese.

Like many European cities, Madrid has for years been home to a Chinese community but in Spain, it has grown more than most. And like their native country, they are suffering less in the economic crisis than their hosts.

"For a couple of years sales have been falling a lot. But we are working hard and we are getting by alright," says Jian Wei Wu Liu, 41, in his big wholesale store lined with red and green ladies’ blouses and dresses.

"I could stay here many more years," adds Wu, who is known to Spaniards as Carlos. "I sell to shops all over Spain. There are still enough customers."

The Chinese traders signing deals and snatching noodles at their tills in the hundreds of stores like Wu’s in Cobo Calleja have come a long way since their predecessors began buying up small groceries and discount shops across Spain.

"They started out running shops and grew so much that they started handling the importation themselves," says Jorge Garcia, a consultant who chairs a Spanish-Chinese chamber of commerce and works with investors in both countries.

"They set up their own distribution centres in Spain. They set up industrial estates. They bought the land, built the warehouses and sold them directly to other Chinese," he adds.

"All this has turned Spain into a major target for Chinese companies. It is the gateway to Europe for Chinese merchandise."

The town hall in Fuenlabrada, the southern Madrid suburb where Cobo Calleja is located, says that out of the 800 businesses operating there, 377 are Chinese-run, employing 3,000 of the total 10,000 people working in the area.

The Chinese firms in the industrial zone officially do some 870 million euros’ worth of trade each year, it says.

They ship in masses of wholesale goods through the port of Valencia, truck them to Cobo Calleja — considered the biggest Chinese trading zone in Europe — and sell it on in Spain and beyond.

Chinese investment in Spain ‘is the future’

Now the Chinese presence here — 167,000 Chinese registered in all of Spain, according to the National Statistics Institute — is attracting interest beyond the traditional retail sector, drawing upmarket investors.

"I often meet Chinese businessmen who come here to do business. They like Spain a lot," says Amanda Kuo, 31, a Taiwanese businesswoman who acts as a consultant for Spanish companies selling luxury products in China.

Now Kuo wants to expand the other way, drawing Chinese investors to Spain.

"That is the future. I tell them to invest in the hi-tech sector which has the most added value," she says.

"I want to capture Chinese businesses that already have business in their sector in China but want to be international. They want the technology and know-how that there is in Spain. They want to invest here."

Originating largely from the eastern city of Wenzhou, the Chinese in Spain have become a familiar fixture, selling Spaniards food and wine, clothes, haircuts and their morning toast and coffee in traditional Spanish cafes.

"They came to Spain to work and make money," said Jin Wu, 35, a Wenzhou native, smiling and smoking outside the grocery shop that he keeps open 12 hours a day in Usera, another largely Chinese neighbourhood in Madrid.

"Now there are Chinese shops for food, fruit and veg, clothes, shoes — all very cheap," he adds, but complains: "It was better before. There’s no money at the moment and the prices have gone up a lot."

Compared to most of Spain’s sickly economy, however, firms with ties to the eastern powerhouse appear to be going strong.

"You can tell there is a crisis at the moment. There are slightly fewer people buying but that is normal," says "Carlos" Wu in Cobo Calleja. "Things are fine. In China, everything is fine."

China’s economy grew by 9.2 percent last year, less than the 10.4 percent expansion of 2010, but far stronger than Spain’s 0.7 percent growth in 2011.

Spain is expected to officially enter recession this month in an economic crisis that has driven unemployment close to 23 percent.

The crisis has prompted spending cuts and labour reforms that have sparked mass street protests in Spain. Pro-China businessmen say this highlights a cultural contrast that helps explain the eastward shift in economic power.

"Unlike the Spanish, the Chinese are not that afraid of the crisis," says Garcia.

"They know that you have to work more and sometimes work for less money and for longer hours. In Spain we have trouble making those changes."

Roland Lloyd Parry / AFP / Expatica

Photo credit: scaredy_kat