China's passenger vehicle sales up slightly in 2017
January 9th, 2018China's passenger vehicle sales edged up slightly in 2017 and are expected to grow faster this year, according to an industrial association Tuesday.
About 24.2 million passenger vehicles were sold last year, up 1.5 percent year on year, according to the China Passenger Car Association (CPCA).
In December, about 2.8 million passenger cars were sold, up 0.6 percent year on year, while over 100,000 new energy vehicles were sold, marking a month-on-month increase for 11 months, CPCA data showed.
The association expected sales of passenger vehicles to pick up in 2018 to reach about 4 percent year-on-year growth.
China is the world's largest auto market and also the fastest-growing market for new energy vehicles, thanks to the government's preferential policies to boost clean energy use to curb pollution.
China’s services activity rises fastest in 4 years
January 5th, 2018New businesses gave a boost to China's services activity which expanded in December by the quickest momentum in four years, a private report showed yesterday.
The Caixin China General Service PMI rose to 53.9 at the end of the year from 51.9 in November, according to the survey conducted by financial information service provider Markit and sponsored by Caixin Media.
It said the growth in services activity was due to a greater volume of new business.
The PMI showed services companies posted the strongest upturn in new orders since May 2015 as around 14 percent of monitored companies noted an increase.
Services companies continued to increase their payroll numbers at the end of the year amid reports of rising business requirements.
Released on Wednesday, the Caixin manufacturing PMI rose to a four-month high of 51.5 for December from November's 50.8 to confirm steady economic growth in 2017.
"The December readings of the Caixin PMI surveys point to improving economic sentiment," said Zhong Zhengsheng, director of macroeconomic analysis at CEBM Group. "Expansion in total new orders and new export business revealed that manufacturers and service providers are optimistic over the business outlook for 2018."
Meanwhile, the official non-manufacturing PMI released last week edged up to 55 for December from 54.8 in November.
The official non-manufacturing PMI survey covers 4,000 large and small companies, while the Caixin service PMI measures over 400.
The services sector contributed to more than half of China's gross domestic product in recent years as the country is in the midst of transforming its economy from investment-driven to consumption-driven.
The Bank of Communications wrote in a report yesterday that China's GDP may have grown 6.8 percent in 2017, above the government target of 6.5 percent.
The bank's economists expect GDP this year to dip to 6.7 percent, with growth of tertiary industries continuing to outpace the industrial sector.
China speeds up introduction of property tax
January 4th, 2018
As part of the plan to contain housing price, China vows to step up housing system reform and create a long-term market mechanism.
When and how a property tax will be levied has long been a public concern.
China's finance minister Xiao Jie has published his policy statement on People's Daily, the Communist Party of China (CPC)'s flagship newspaper.
What have been specified?
Xiao outlined that property tax will be levied on industrial and commercial properties, as well as personal residential houses, based on their "appraised value". He also suggested the legislation work would be completed by 2019, which would lay the foundation for its enforcement in as early as 2020.
Experts believe it has sent out signals for the speeding up of China's introduction of property tax.
"The article shows that the authorities now have clearer thinking on the levy of property tax, as substantial questions have been specified, especially how the taxes will be collected," said Yan Yuejin, senior researcher of the Shanghai-based E-house China R&D Institute.
Yan noted that "appraised value" means a comprehensive assessment of the original and current value of the property, while also taking into account affecting factors such as the real estate market situations and the price of similar property in surrounding areas. "It's a rather fair and reasonable way to do it," Yan added.
It would require the establishment of an appraising system by each city, according to Zhang Dawei, chief analyst of Beijing-based Centaline Property, a leading property agent company. In Xiao's article, he also confirmed that local governments would obtain enough authorization in the process.
"That means local governments are allowed to run pilot policies based on their specific circumstances, so as to map out practical schemes that suit local development," said Jiang Zhen, research fellow with Chinese Academy of Social Science, "and their experiences drawn from the pilot programs will become important reference for property tax legislation, which will be pressed ahead steadily."
Why is property tax put on China's legislation agenda?
"Housing is for people to live in, not for speculation," this has been the tone-setting slogan for China's real estate market since it was first brought up by Chinese president Xi Jinping on the Central Economic Work Conference in December 2016. The long-awaited property tax is a key measure to reduce the appeal of houses as speculative investment, and bring the development of China's housing market to the right direction.
China's property price has been rocketing for over a decade, partly due to Chinese investors' preference for houses as investment and the resulting speculations. Bloomberg estimated that 25 percent of China's housing demand is out of speculations.
At present, taxes are only levied when houses are bought or sold, which leaves multi home owners with no extra financial burdens. The planned introduction of property tax may not only deter future speculators, but also drive existing multi home owners to sell extra ones before the enforcement of the new tax, thus increasing housing supply in the market.
But it's all up to the release of further details on how the property tax will be rolled out step by step.
China to optimize business environment
January 3rd, 2018The State Council made arrangements to optimize the business environment to stimulate market vitality and social creativity, at an executive meeting Wednesday.
Premier Li Keqiang, who chaired the meeting, called for universal use of a negative list of sectors and businesses off limits to foreign investment to control market entry.
Optimizing business environment would help productivity and competitiveness, he said.
The business environment is the foundation for developing a modern economy and ensuring high-quality development, the premier said.
Greater efforts should be made in streamlining administration, compliance oversight and offering better services. An internationally competitive business environment would have equal treatment for domestic and foreign enterprises and stimulate market entities and social creativity," he said.
China was ranked the 78th in ease of doing business, according to a 2017 report by the World Bank, up from the 96th place in 2013.
The government will cut red tapes, reduce taxes and slash fees for enterprises.
It was decided at the meeting that more efforts will be made to slash or cancel fees paid by enterprises, including operational and service fees and fees charged by sectoral associations and chambers of commerce. Costs for customs clearance will be lowered.
The government will further simply the procedures of administrative review and speed up approval procedures for business start-up, tax payments, application for construction permit and water, electricity and gas services, and real estate registration. The slashing of electricity price will also be a priority.
A new oversight mechanism characterized by integrity and information disclosure will be established at a faster pace. A unified punishment mechanism for breaches will be improved. An evaluation mechanism for business environment will be established, and rolled out nationwide over time. Special sectoral measures will be unveiled to facilitate the application for construction permits and cross-border trade.
"There is still much more that we can do to streamline administration, enhance compliance oversight and improve services. We should foster a more enabling business environment to incentivize a visible improvement in the ease of doing business for entrepreneurs, market entities and the general public," Li said.
A series of measures have been taken by the current government to cut red tape, reduce corporate burdens and improve the business environment. It has canceled or delegated administrative approval by the State Council bodies on 697 items, which account for 45 percent of the total.
The government also shortened the list of intermediary services for administrative approval by 323 items, or 74 percent of the total, and canceled professional qualification and certification requirements for 434 items, more than 70 percent of the total.
'Corporate service labs' to support startups in first three months
December 22nd, 2017Shanghai's first "corporate service lab" has opened in a number of downtown districts to offer legal, financial and other support to local startup companies.
The service project, named "wehome LINK", was initially established in two major Dobe innovative parks in Changning and Jing'an districts as the first batch of "service labs" to serve hundreds of locally based startup firms in a trial operation.
Under the scheme, service providers such as law firms, human resource management companies, insurance providers and incubators will offer services to the small and medium-size enterprises for three months. The parks' operator will evaluate their performances and decide whether to retain or substitute them with better service providers.
This scheme will support a large swathe of startup companies under the government's mass entrepreneurship campaign, especially during the bottleneck period that most local innovative firms are undergoing.
"We found many young entrepreneurs, though they do have achievements in their fields, can hardly figure out many problems during the management and operation of their startup companies, such as share allocation, legal disputes and financial issues," said Jia Bo, chairman of Dobe Group, a major developer of local innovative parks.
"Some small and medium size companies don't even know how to apply for government subsidies that they are entitled to, and lost the opportunity to further develop," Jia said.
The first batch of seven service providers has entered the two innovative parks and begun serving startups on these issues. They include the Watson & Band law firm, online insurance company Qibao 360 and other service suppliers in print, office decoration, air purification and housekeeping.
Currently, most of the startup companies receive basic administrative services from incubators who merely help the entrepreneurs register their companies, pay taxes and apply for patents.
Most of the incubators neglected other more essential demands from startup companies, which hampered their development, according to mobile-Internet consultancy iiMedia Research.
Shanghai aims to be global cultural, creative center by 2035
December 15th, 2017Shanghai municipal government said Thursday it will develop the city into a cultural and creative center with international influence by 2035.
According to a newly-issued document, which introduced 50 promotional measures, the added value of the cultural and creative industry will account for about 15 percent of the city's GDP in the next five years, and about 18 percent in 2030.
Shanghai Mayor Ying Yong said the cultural and creative industry is a pillar industry for Shanghai, and plays an important role in the city's development and the people's livelihood.
The document said Shanghai will become a global film and television production center, a performance capital in Asia, a global animation and game production base, a leader in domestic Internet culture and publication, an international creative design highland, and an international art trading center.