(Yicai) Oct. 30 -- Eighty-seven percent of Chinese packaging companies have already expanded overseas or have imminent plans to do so, according to an industry report.

Chinese packaging firms are going global thanks to the support from the country’s Belt and Road Initiative and the international expansion of consumer brands, a report jointly released yesterday by accounting giant Deloitte and the China Packaging Executive Club showed.

Consumer brands expanding overseas is the main drive for the internationalization of packaging firms, said She Xin, chairman and president of AMB China Logistics and chairman of the China PackEX Club.

China’s domestic packaging industry faces hurdles, such as homogeneous products and overcapacity, so businesses venture overseas by leveraging high management efficiency and cost advantages. As of the end of last year, China had more than 10,000 packaging companies with annual revenues of over CNY20 million (USD2.8 million), with the total exceeding CNY1.2 trillion (USD164 billion).

Chinese packaging materials have a cost advantage over those made in Europe, the Middle East, Southeast Asia, and the United States, and their quality is on the same level, said Fan Lidong, vice chairman of the China PackEX Club and former president of the Chinese arm of Swiss aseptic carton packaging supplier SIG Combibloc.

However, Chinese packaging equipment are still far behind those of developed countries, so their export destinations are mainly Africa, the Middle East, and Southeast Asia, Fan noted, adding that Europe is also a growing market.

Downstream customers are focusing more and more on packaging material innovation for cost-effectiveness, customization, flexibility, functionality, and product protection, according to the report.

Eco-friendliness is also a main trend, with about 80 percent of companies having set environmental goals, the report showed. Reducing material use and opting for biodegradable materials are helping businesses lower costs and improve profits.

While Chinese packaging firms are going global, foreign peers are expanding their presence in China by hiking their local research, production, and investment.

Editor: Futura Costaglione