With the local and national economies weakening, and perhaps already in recession, small and large businesses are worried about where the growth will come from in 2008.

How about looking overseas, especially to China?

A business owner may shudder over the risks of entering a new market where the language, culture, business practices and rules and regulations are different.

But every year, more and more Rhode Islanders are doing business in China. Consider Felix Porcaro, chief executive officer of Crimzon Rose International in North Providence.

After college, he worked for AAI International, the jewelry and accessories company founded by Felix Porcaro Sr., and learned the business by traveling to Japan, Korea and Taiwan. In 2001, he formed Crimzon Rose, an importer and distributor of costume jewelry and hair accessories to large retailers, such as Wal-Mart, Target, Kohl’s and Kmart. The products are made by an Asian subsidiary, which runs three factories in China, in Guangdong, YiWu and Qindao, that employ more than 100 workers. Porcaro says there are constant headaches with doing business in China, including rising labor costs, changing government rules and regulations and assuring quality standards to meet the demands of big retailers.

Still, the rewards have outweighed the risks.

“The world is getting smaller,” Porcaro says. “If you’re not there now, get there fast.”

Porcaro and a group of international bankers, lawyers and consultants spoke about China as a business opportunity to about 150 people at a seminar last week sponsored by Citizens Bank, the Bank of China and the Greater Providence Chamber of Commerce. Citizens’ parent company, the Royal Bank of Scotland, saw the emergence of China years ago and acquired a 10-percent stake in Bank of China, forming a partnership to make services available to business clients that want to do business there.

Porcaro and the other experts explained that China, with its growing middle class, provides an opportunity for selling products in its population centers. There are also opportunities to manufacture there. China has about four times the population of the United States and 170 cities of 1 million people or more. Most of the economic activity, and the population, is concentrated on the east coast.

Business owners, however, can find lower labor, operating and land costs, a surging demand for foreign products and less competition in other parts of the country. But there are also dangers, such as unreliable energy supplies, poor roads and transportation systems, inexperienced workers or managers who haven’t done business with Americans. There also may be cumbersome local laws and government bureaucrats who are not familiar with working with foreigners.

Do your homework before you do business, Porcaro advised.

He urged reading trade journals, going to trade shows, networking with other business leaders, using state and federal government services and visiting the country to make face-to-face contact with your new partners.

“Don’t underestimate the language barrier,” he said, “and show respect.”

Several experts at the seminar said one of the challenges of doing business in China is navigating a labyrinth of laws and regulations that are always changing, plus labor standards and tax rules that are constantly being revised. Local government officials in different areas implement the national laws in different ways, and some are also corrupt.

There is also the issue of contracts with suppliers or manufacturers. Unlike in the United States, where a contract is a binding legal agreement, a contract in China can often be changed and renegotiated even after it is signed by both parties.

Porcaro says one of his biggest concerns is assuring the product quality demanded by his buyers. Every factory in China should undergo an audit that includes walking the manufacturing floor, meeting managers and insuring compliance with specific standards.

“There has to be constant quality checks. You have to sample and counter sample,” he says. Porcaro knows what he is talking about. Some earrings he had made in China had to be voluntarily recalled several years ago because of their lead content, according to the Consumer Products Safety Council.

And once established in China, a businessperson is still not done.

“Never fall in love with a factory,” Porcaro says. “When costs get too expensive, you have to find another one.”

A business owner also faces the challenge of melding workers on different continents into one team. He encourages interaction by setting up cameras on desks and encouraging workers to use the Internet to share information and common events, such as birthdays and weddings.

A central message from the experts at the seminar is that China is still developing.

Since the country began moving in 1949 under Mao from socialism to a market economy, successive leaders have strengthened ties to the Western way of doing business. The numbers point that out.

U.S. exports to China have grown 300 percent since 2000, to $66 billion, according to the U.S.-China Business Council. Exports from Rhode Island to China during the same period have topped $58 billion, up 230 percent.

The U.S. economy is surely slowing, but China’s is growing, fast.

jkostrze@projo.com