Labour Minister Membathisi Mdladlana has urged Business South Africa (Busa) to establish contact with their China counterparts.

The minister was speaking at a meeting with the employer organisation, the China Enterprise Confederation in Beijing on Tuesday.

"It's interesting to observe how China has managed to maintain its ideology in the face of globalization and reformed their economy in their own terms," he said.

Since opening up its markets to the world, China's economy has grown in leaps and bounds in recent years, with investment from more than 500 000 foreign companies.

"It is clear that there is something right that China is doing, and South Africa has a lot to learn from sharing experiences with them. Close cooperation with China would be of great benefit."

The signing of a Memorandum of Understanding by President Thabo Mbeki and his Chinese counterpart Hu Jintao paved the way for the signing of a similar agreement between the two countries' Labour Ministries in 2006.

"This, together with our political and historical ties - forms a firm base for business to capitalise on," the minister said.

China Enterprise Confederation's Vice President Chen Lan Tong said the Confederation has 545 000 members throughout China.

"In the main these are high tech industries. There is also expansion in the banking and insurance sectors."

Although China is beginning to reap the fruits of reform and the opening up of markets, the country still faces some hurdles.

"Restructuring of state enterprises remains a challenge. The state is still in control of key industries," said Mr Chen.

"We encourage local business to also look abroad for opportunities, and South Africa is one of those destinations," he said.

South Africa is giving a lot of support to China's construction industry.

Busa's Vic van Vuuren who is part of Minister Mdladlana's delegation has welcomed the minister's suggestion to form partnerships with China's employer organisation.