The bold plan includes expanding the networks of its newly founded joint-venture life insurer to other cities, seeking projects for direct financing and introducing more innovative products to the market.

"Part of our strategy is, over time, to expand the products that we offer in other markets into the Chinese market and to bring innovative and new products," said Gary Benanav, chairman and chief executive of New York Life International, the arm in charge of the company's international business.

"The reason that we do not want to start with a very broad range is we believe people selling these products need to be well-trained so they can understand what they are selling," Benanav said in an exclusive interview with China Daily on the sidelines of the recent opening of its life-insurance joint venture in Shanghai.

After the world market shrank following World War II, the US-based insurance giant launched a campaign to tap overseas markets in 1988, with key target markets being those in Latin America and Asia. The company has a wide business presence in Argentina, South Korea, Thailand and Hong Kong.

"We prefer to put our resources in countries like China and India, where the growth is much more likely to come," said Benanav.

"What we look for when we enter a market is sustainable economic growth in the coming decades," he added.

"As I look around the world today, China and India, I believe, will have the most potential for the next 10 and 20 years as they are huge economies and seem to have their economic houses in pretty good order for growth, and the middle class is likely to grow very rapidly," said Benanav.

He said that his company is not interested in markets that are already highly developed, where the economy is going to grow very slowly and where the insurance sector is already very mature, such as Western Europe, Japan and Australia.

"The Chinese market is extremely important to our global business. There is very little doubt in my mind that China will be the largest market for New York Life outside the United States," said Benanav.

He added: "We have no intention of abandoning or reducing the focus that we have in other markets that we operate. Just in terms of sheer size, the Chinese economy will grow because of the population and the growth of income in the country."

As China opens up its market more quickly to foreign players, New York Life's goal will also be much more easily achieved.

"But it is hard to tell how quickly the Chinese Government will allow us to expand into new cities," said Benanav.

The company has teamed up with China's Haier Group - one of the country's most powerful industrial groups - to establish a joint-venture life-insurance firm in Shanghai to offer life policies to local and expatriate customers, making it the 15th life insurer operating in the financial hub.

The 50-50 joint venture said it will mainly target China's emerging middle class as potential customers.

"China will continue to outpace Western countries to become one of the world's fastest growing economies in the coming decades, which is expected to provide a golden opportunity for the growing middle class," said the chairman.

If the government allows, Benanav said,his firm will probably go into nine Chinese cities simultaneously depending on time factors, its rivals and the economic scale of the targeted cities.

Referring to the time when the company will file documents for follow-up expansion plans, the chairman said: "It would depend on what the conditions are at the point the government allows us in, who else opens up in that city, and what the economic situation is in that city.

"But we will make the call at the right time."

The chairman said the company is in the market for long-term profits, not a quick return.

"We should not expect a start-up operation to become profitable for five to seven years. The faster you grow, the longer it takes to become profitable," said Benanav.

Talking about the link-up with Haier, he said: "We already have issues where we do not agree with each other, but we end up solving them very easily and very quickly.

"As long as the joint venture with Haier is successful, we are perfectly happy to operate as a life-long joint venture. We think Haier does bring something to the joint venture. There is no reason for us to go off, and we will join hands to expand to other cities."

Apart from the joint-venture life-insurance business in Shanghai, the Fortune Global 500 company is also looking for opportunities for direct investment in western China, a move billed by the company as another pillar to back up its long-term businesses in China.

The company said it is continuing to look for long-term infrastructure projects in which it can invest directly in China. "We believe that there will be opportunities that will represent good investment for our portfolio at a fair yield," said Benanav.

He said the company is particularly interested in projects such as water facilities, ports, telecommunications and sewerage facilities that require long-term funds.

(China Daily January 6, 2003)