Building a Credit System: Yiwu strengthens evaluation for better business environment

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02:22

From a little county with two hotels, to an international trade city, Yiwu, in Eastern China's Zhejiang province has grown rapidly in recent years. Now the city is working to establish a sound credit system for a better business environment. CGTN's Sun Tianyuan reports.

Yiwu, one of China's busiest cities for trade, has beefed up its credit evaluation system for companies at home and abroad. But for Canadian merchant Fares Daou, who has worked here for over 20 years, he prefers doing business the old way.

FARES DAOU, PRESIDENT CHAINEX LTD "I don't believe in credits. I believe in paying cash. Cash is power. If my client does not pay me, I don't want to do business."

Cash up front - as he claims, with fewer headaches. As much as Daou loves his second home, business is business.

FARES DAOU, PRESIDENT CHAINEX LTD "That means if I want to give credit to another company, I will check the credit history of the company. If the history is good, then you're okay. If the history of the company is not good, you will take chances of giving them credits."

Last year, the city blacklisted more than 300 companies, putting limits on their financial aid and business ratings. 100 companies were also restricted from participating in biddings.

But for Chainex, one of the top ten foreign companies on Yiwu's red list, the government will provide them with longer work permits and prioritize their financial services.

FARES DAOU, PRESIDENT CHAINEX LTD "We are thankful for that, for this thing (award). The Yiwu government, they see the good people, investing, creating, and pushing (the economy)."

While Daou may never change his tried-and-true business methods, his colleague of ten years says she's optimistic about the system.

YU JIAJIA, MANAGER CHIANEX LTD "I think this can be a great opportunity for merchants in traditional foreign trade. There is a big potential for Yiwu to further improve its business environment. Although we are a late starter, I believe the city will quickly catch up with leading cities like Guangzhou and Shenzhen."

SUN TIANYUAN YIWU "Successful businesses are built on good faith, and honesty is any market's basic principle. The establishment of a sound credit system will create a better environment for consumers and global traders like Daou. Sun Tianyuan, CGTN, Yiwu, Zhejiang Province."