LED Export Guide: Analysis of Development Situation in 14 Countries Around the World

Driven by the "going global" strategy, more and more Chinese LED lighting companies are interested in overseas markets, but they may not dare to act rashly. There are considerable discrepancies in the overseas market reports of various institutions. Overseas investment briefings often only talk about opportunities, with little or no mention of risks.

Based on customs data, comprehensive reports from multiple agencies, and combined with the on-site conditions of multiple overseas investment briefings, a comprehensive evaluation of some frequently mentioned overseas markets was made, and the following recommendations and warnings were made for reference only. In fact, if an LED lighting company is interested in a certain foreign market, it is best to go to that country for on-site research, so that you can know best whether it is suitable for your company.

1. Greece

Recommendation index: 0

Early warning index: ★★★★★

Due to its failure to repay a 1.5 billion euro loan from the International Monetary Fund on time, Greece became the first developed economy to default in the 70 years since the organization was founded. Global news media reports indicate that Greece is on the verge of bankruptcy, and Greek companies are facing a severe test of survival. The Greek Lighting Company stated that overseas customers were afraid to place orders with Greek companies.

However, where there is "danger", there will naturally be "opportunities". For Chinese companies that have not yet played a decisive role in the Greek economy, the business space in Greece is obviously considerable, and they may be able to give it a try.

2. Australia, New Zealand

Recommendation index: ★★★★

Early warning index: ★★★

Australia is one of the first countries in the world to start phasing out incandescent lamps. Incandescent lamps are no longer available for sale on the market, replaced by shaded halogen lamps and shaded fluorescent lamps. Australia is a typical sparsely populated country with about 7 to 8 million households, and each household has an average of 70 to 80 lamp holders. The products were originally mainly MR16 halogen lamps and traditional absorbent lamps, which have great replacement potential. LED downlights and street lights are widely used in urban construction.

In Australia, in terms of light source brands, in addition to Philips and Osram, the most popular are local Australian brands Nelson, Click and Brilliant; the lighting market certification has its own system and the entry threshold is high. However, compared with the European, American and Japanese markets, it is a relatively unfamiliar market for Chinese lighting companies and has certain market potential.

This year, the retail price of LED products in Australia has generally dropped by about 30%. The overall volume per customer is not large, but the price is relatively good, making it suitable for mid-to-high-end brands to enter.

New Zealand has a huge demand for LED products. The government provides subsidies for companies to purchase environmentally friendly lighting products to drive local demand. If you want to export lighting products to the New Zealand market, the products must bear the C-Tick mark. The relevant certification is not complicated, and you only need to follow the arrangements. It is worth mentioning that you should pay more attention to the updates to the relevant product certification standards. However, it is understood that local residents believe that the design of Chinese LED products is too "Chinese-style", and the New Zealand market has a greater demand for Western-style designs and outdoor lighting that can resist seawater erosion.

3. Europe

Recommendation index: ★★★

Early warning index: ★★★

< p>Since 2014, European countries have begun to gradually phase out 40-60W incandescent light bulbs, which are the most commonly used in the civilian market. In the next few years, with the impact of the comprehensive ban on incandescent light bulbs, the market is expected to continue to show a steady growth trend. Although large-scale subsidy policies have not been seen, the high electricity prices and differences in light culture have created continued demand for commercial lighting and outdoor architectural situation lighting applications.

The European market has always been the second largest export destination for Chinese lighting companies, and the data for the first quarter of this year is no exception. Germany imports large amounts of Chinese tube lights, light strips, vehicle and boat lights, and stage lights. The Netherlands has a large demand for Chinese tube lights, spotlights and stage lights. Italy imports a large amount of Chinese light strips and indoor decorative lights. The UK has a large demand for Chinese spotlights and indoor decorative lights. France mainly imports Chinese spotlights. Belgium and Denmark mainly demand Chinese stage lights.

Europe has higher lighting standards and has higher requirements for lighting effects and atmosphere. In addition, Europe is currently affected by the Greek debt crisis. Italy, Spain, Portugal, Ireland and other countries have all fallen into debt crises to varying degrees. If Greece is ultimately unable to coordinate the relationship between creditors and the domestic public and resolve the contradiction between austerity policies and economic growth, it may trigger a chain reaction once it exits the Eurozone, affecting the economic development of the region and even Europe as a whole.

4. United States, Canada

Recommendation index: ★★★

Early warning index: ★★★

This year’s survey shows that two-thirds of the American people have purchased household LED lighting products, which is almost double the number two years ago. Mainly attracted by the color variety, low energy consumption and Energy Star certification.

The United States is the country that exports the largest variety and quantity of lighting products in China. Product categories include: tube lights, bulb lights, light strips, spotlights, indoor decorative lights, garden lights, floodlights, grille lights, flat lights, vehicle and ship lights, stage lights, and explosion-proof lights. Canada also imports relatively large amounts of bulbs from China.

The North American lighting market has a high entry barrier. However, Chinese lighting products have a comparative advantage in price. About two-thirds of American consumers said that price is the most important factor in deciding whether to buy LED lights.

5. Egypt

Recommendation index: ★★★★

Early warning index: ★★

Egypt is the third largest economy in Africa and the largest consumer market in the Middle East and Africa. Egypt has a free trade agreement with the Middle East and Africa. Entering the Egyptian market, in addition to the domestic market, you can also cover your products to the surrounding Middle East and African markets, with a total of more than one billion consumers. Egypt also has a large supply of cheap labor.

In order to achieve economic recovery as soon as possible, the Egyptian government has taken a series of measures to attract the return of foreign investment and reduce the pressure on the fiscal deficit. There are currently a large number of infrastructure facilities and huge market demand. The country plans to implement a major lighting transformation around 2020 to replace traditional lighting with energy-saving products. In addition to government buildings, household lighting, and local outdoor lighting in all districts and counties need to be comprehensively transformed.

However, whether Egypt can maintain stability after the coup is a factor that must be considered.

6. South Africa

Recommendation index: ★★★★

Early warning index: ★

China’s exports to South Africa have been growing steadily. From January to March 2015, the national lighting industry’s cumulative export volume to South Africa was US$47.5013 million, a year-on-year increase of 6.30%. The proportion is mainly concentrated in Guangdong, Zhejiang, Shanghai, Jiangsu, Fujian and other regions. Guangdong completed a cumulative export volume of US$27.9623 million (accounting for 58.87%), a year-on-year increase of 10.17%.

Statistical analysis by the London Research Institute (Economist Intelligence Unit Ltd.) estimates that by 2016, more than half of the countries in Africa will have an annual gross domestic product growth of 5%, and the South African market cannot be underestimated. The South African government plans to establish a special economic zone in the duty-free zone "Dube TradePort" near Durban to activate local investment activities.

In November last year, the South African Department of Trade and Industry issued mandatory specifications for electrical lighting. However, China has a high diplomatic status in South Africa and has many years of trade experience. China’s institutions in South Africa have rich experience in handling trade disputes. It should be noted that China's export data to South Africa in the first quarter of this year showed that lighting fixtures completed a cumulative export volume of US$31.5453 million (accounting for 66.41%), a year-on-year increase of 15.48%; electric light sources (bulbs) completed a cumulative export volume of US$10.5421 million (accounting for 22.19%), a year-on-year growth of -15.19%.

7. Brazil, Venezuela

Recommendation index: ★★★★

Early warning index: ★★

China's exports to Brazil have grown steadily over the years, with a year-on-year increase of 68% in the first quarter of this year. Exports to Venezuela are also growing. From January to March 2015, the national lighting industry completed a cumulative export volume of US$9.5339 million to Venezuela, a year-on-year increase of 220.94%; the proportion was mainly concentrated in Guangdong, Zhejiang, Chongqing, Yunnan, Shanghai, Jiangxi, Sichuan, Jiangsu, Hunan, Beijing and other regions, of which Guangdong completed a cumulative export volume of US$3.7774 million (accounting for 39.62%), a year-on-year increase of 173.75%.

In recent years, Brazil's economic development momentum has shown a gradual upward trend. Since 2012, Brazil's economic scale has ranked sixth among the global economies, and its economic structure is close to the level of developed countries. Brazil is currently the tenth largest energy consumer in the world and the largest energy consumer in South America. It has an urgent need for environmental protection and energy conservation. As the host country of the 2016 Olympic Games, Brazil will generate market opportunities exceeding one trillion US dollars.

Currently, China has become Brazil’s largest LED importer, accounting for more than 60% of its total imports. However, in the past, Brazil's LED lighting products basically relied on imports, but now it has begun to manufacture such products locally. In addition, Brazil's trade tariffs are high, coupled with many legal restrictions, trade protectionism is serious. Without core advantages such as technology patents, it is difficult to enter the Brazilian market based on price alone. Currently, China's LED products exported to the Brazilian market are mainly exported in the form of OEM, and local consumers do not have high awareness of Chinese brands.