Archives for: 2016


Permalink 02:20:43 pm, by dacare, 111 words, 361 views   English (US)
Categories: News of China

China's car sales growth to slow in 2017

Automobile sales are expected to slow next year after a boom in 2016, the Ministry of Commerce (MOC) said Thursday.

Growth in auto sales in 2017 could slow to an annual 2 percent to 6 percent, said MOC spokesperson Shen Danyang, citing industry estimates.

About 25 million cars were sold in China in the first 11 months this year, up 14.1 percent year on year thanks to a preferential car purchase taxation policy and other government measures.

Earlier this month, the Ministry of Finance continued its preferential car purchase taxation policy but cut the tax reduction ratio for 2017.

A high comparison base and a discounted preferential taxation policy will drag down auto sales growth next year, Shen said.

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Permalink 02:47:22 pm, by dacare, 369 words, 300 views   English (US)
Categories: News of China

China's VR industry tumbles after explosive growth

When Fang Wenxin founded a virtual reality (VR) firm in 2015, he never expected the industry would go bust so soon.

The boom in China's VR industry following Facebook's U.S.$2-billion buyout of Oculus, a U.S. producer of VR gadgets and computer games, in 2014 has declined, with about 90 percent of start-ups in the domestic market declaring bankruptcy.

"There were about 200 to 300 firms engaged in producing VR helmets in 2015, but now no more than 10 companies remain functioning," Fang said.

During the past few months, domestic VR companies, such as Storm Magic Mirror, Miido and AlfaReal, started to downsize organizations or delay payments of employee salaries due to a diminution in venture capital.

According to the latest report issued by iiMedia Research, a third party data collector and analyst of technological digital platforms, the supply of high-end smart glasses in the domestic market has failed to lure consumers, with more than 70 percent of respondents among smart cell phone users expressing no willingness to buy one.

Taken up by gigantic tech firms, such as HTC, Facebook and Sony, the market for VR hardware has left slim chances for smaller manufacturers to slot in, so that the VR businesses of domestic manufacturers focus mostly on content production.

However, despite the increasing involvement of VR start-ups, cheap copycats have eaten up the market, blocking the channels necessary for high-end innovation to reach customers.

The slump in the VR market during the second half of 2016 in China is probably the result of deficient industrial innovations, said Wu Limei, an analyst of the iiMedia Research.

But the recent fall of the VR industry may be less ominous than a sign of industrial recession when the frenetic flows of capitals have cooled down.

Zhao Ziming, an analyst from Analysys, Ltd., an agent of data collection and analysis, said the industry will be reshuffled by the entries of big companies, like BAT and NetEase, following the bankruptcies of small companies with broken capital chains. The threshold will be elevated and the money will be spent more reasonably.

Investment in the Chinese VR industry soared to 270 million yuan (U.S.$38.9 million) in 2014, a robust rise followed by 2.4 billion yuan in 2015 and 1.54 billion yuan in the first half of 2016.

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Permalink 01:32:58 pm, by dacare, 153 words, 305 views   English (US)
Categories: News of China

China's industrial profit growth accelerates to 14.5% in November

Profits of China's major industrial firms increased 14.5 percent year on year in November, up from 9.8 percent registered in October, official data showed Tuesday.

Profits of industrial companies with annual revenues of more than 20 million yuan (about 2.87 million U.S. dollars) totaled 774.57 billion yuan last month, the National Bureau of Statistics said.

In the first 11 months of the year, industrial profits expanded 9.4 percent year on year to 6.03 trillion yuan, faster than the 8.6 percent rise for the first ten months, the NBS said.

NBS statistician He Ping said the sharp growth in November was a result of acceleration in the growth of both industrial production and sales, a significant rise in producer prices and the strong performance of electronics, special equipment manufacturing and oil refining sectors.

China's producer price index (PPI), which measures costs for goods at the factory gate, continued its growth, rising by a five-year high of 3.3 percent year on year in November.

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Permalink 03:47:13 pm, by dacare, 164 words, 262 views   English (US)
Categories: News of China

China's Sany sets up commercial bank

Sany Group, the parent company of heavy machinery manufacturer Sany Heavy Industry Co. Ltd, on Monday led a group of ten private companies in setting up a commercial bank.

The Sanxiang Bank, based in Hunan Province, will operate with a registered capital of 3 billion yuan (435 million U.S. dollars). It is China's eighth private commercial bank since the regulatory allowed private capital into the banking sector in 2013.

The Sanxiang Bank will focus on Chinese manufacturers, especially those investing heavily in technology.

Bank president Liang Zaizhong said that while operating with much less capital than state banks, it is China's first bank associated with a major manufacturer.

Sany Heavy Industry Co. Ltd. sells a wide range of construction machinery such as excavators and cranes and has extensive global presence. It operates 25 manufacturing bases and 100 offices worldwide. Key overseas research and production hubs are based in Brazil, Germany, India and the United States.

The company has ventures in clean energy, with a focus on wind power.

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Permalink 12:56:16 pm, by dacare, 81 words, 349 views   English (US)
Categories: News of China

Taiwan unemployment rate falls to 3.87 pct in November

Taiwan's unemployment rate was 3.87 percent in November, down 0.08 percent from October, and 0.04 percent lower year on year, the island's statistics agency said Thursday.

There were around 455,000 unemployed people in Taiwan at the end of November and 11.3 million in employment, according to a statement on the agency's website.

More university graduates landing jobs in the month were cited as the main reason for falling unemployment, the agency said.

The seasonally-adjusted rate of unemployment for the month was 3.84 percent, down 0.06 percent from October.

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Permalink 10:23:54 am, by dacare, 652 words, 493 views   English (US)
Categories: News of China

China faces trade friction with developing markets

Lack of differentiated competition amid global trade downturn to blame: experts

Trade frictions between China and other developing markets over almost everything from home appliances to chemicals are increasing, a heating up in competition that comes amid a downturn in global trade.

Some of the latest disputes were initiated by Argentina, which opened up five anti-dumping probes against Chinese imports, including on steel pipes, food processing machines and dishwashers, on December 7, according to trade alerts issued by China's Ministry of Commerce (MOFCOM).

Such "intensive" investigations aroused attention in China, Wang Hejun, director of Trade Remedy and Investigation Bureau with the MOFCOM, said in a press release on Wednesday.

According to the press release, China will thoroughly defend the rights of its firms and expects Argentina to strictly follow WTO rules.

So far this year, Argentina has launched 11 anti-dumping probes against imports from China, according to the MOFCOM.

China is Argentina's second-largest trade partner with $11.8 billion worth of goods exported to the Latin American nation in 2015, an increase of 9.7 percent year-on-year, according to media reports.

"Emerging nations including Argentina, India, Brazil and Pakistan are prone to file WTO complaints to guard their homegrown industries against imported peers, as they are suffering from sluggish global demands and economic downturns," said Wang Jun, deputy director of the Department of Information at the China Center for International Economic Exchanges.

Rising probes

In recent years, developing economies have filed more frequent complaints against China's exports.

MOFCOM data showed that, so far this year, Pakistan hit China with eight anti-dumping investigations and India has started some 20.

India initiated a total of 10 anti-dumping and anti-subsidy cases in 2015, according to a statement issued by China Council for the Promotion of International Trade in February.

That year, 49 anti-dumping and anti-subsidy investigations were launched by developing countries, accounting for more than 60 percent of all probes against China, and a 22.5 percent increase from 2014, the statement showed.

China's aggressive push in its going out strategy has made it an easy target for the current trade protectionism fever, Wang, the expert, told the Global Times Thursday.

The first 11 months this year witnessed a surge of 55.3 percent year-on-year in China's outbound investment to $161.7 billion, official data showed.

Premier Li Keqiang predicted in October that China's overseas investment would grow to about $720 billion in the following five years, and that its import volume would reach $8 trillion, according to the Xinhua News Agency.

A long-term challenge

"Most Chinese services and products sold to foreign consumers are the similar as products emerging countries are developing themselves," Chen Fengying, an expert at the Institute of World Economics Studies under the China Institute of Contemporary International Relations.

The lack of differentiation will continue to create heated competition and will spur more complaints from other developing countries and regions, Chen told the Global Times Thursday, signifying long-term challenges Chinese firms will face while going global.

Wang, the expert, suggested that China would see more trade disputes as long as there is no sign of recovery in global trade.

"The U.S. and the EU are expected to start more trade battles with China in the following years, which will drive some developing countries to follow suit," he explained.

President-elect Donald Trump is packing his transition team with veterans of U.S. steel battles with China, likely indicating a more aggressive approach to U.S. complaints against China, Reuters reported on Tuesday.

In order to carry out its "One Belt, One Road" initiative, China may need to make some compromises to settle trade disputes with other developing countries, Wang said.

Still, Chen noted that trade frictions with India, Argentina and other developing countries would not greatly impact Chinese trade volumes which mainly bank on the U.S. and EU markets.

In November, China exported 34.5 billion yuan ($4.98 billion) and 15.2 billion yuan worth of goods to India and Brazil, respectively. In contrast, China exported 247.4 billion yuan worth of products to the U.S. last month.

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Permalink 12:17:44 pm, by dacare, 220 words, 329 views   English (US)
Categories: News of China

China predicts 958 million working-age population in 2030

The number of people in China of working age is expected to have shrunk slightly to 958 million by 2030, the Family Planning Association (FPA) announced Wednesday.

Wang Pei'an, vice president of the FPA, said the country had 1.003 billion people of working age in 2015, which will gradually decline to 958 million in 2030 and 827 million in 2050.

"Though China still has a healthy labor force at this moment, the decreasing number of women of childbearing age means we should not wait any longer to fully implement the two-child policy," Wang said.

There were 826 million people of working age in Western developed countries in 2015, thus, while boasting a huge population, China's overall labor productivity is just one eighth that of the developed countries, said Wang.

The FPA will improve its family planning services, such as reproductive health consultation, Wang said.

Wang added that the FPA will also pay special attention to protecting the rights and interests of the nation's migrant population, and will provide health services to "left-behind" women and children in rural areas.

Since Jan. 1, all married couples have been allowed to have two children. This follows an earlier easing of the policy in 2013 allowing couples to have a second child if either parent was an only child.

The latest change ended the "one child" policy that had been in place since the late 1970s.

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Permalink 10:23:36 am, by dacare, 351 words, 365 views   English (US)
Categories: News of China

Now, UnionPay slips through barcode for payments pie

China UnionPay, the national bankcard association, launched on Monday its own app and security standard for two-dimensional barcode payment.

It thus joined existing players Alipay and WeChat Pay in the internet-based mobile payments segment.

Song Hanshi, general manager of UnionPay's technology department, said it will adopt unified technical solutions to achieve interconnectivity among different financial institutions and to ensure consistency in user experience.

Currently, commercial banks have their own two-dimensional barcode payment apps and UnionPay hopes to promote the use of barcodes across different banks.

It will also apply token technology to protect sensitive account information from leaking and to ensure payment security.

The bankcard association is working on risk control standards for two-dimensional barcode payments and will launch its own product in this area, according to Cai Jianbo, first executive vice-president of China UnionPay.

Zhao Yao, a special research fellow at the Institute of Finance and Banking at the Chinese Academy of Social Sciences, said: "This is an important measure taken by UnionPay and commercial banks to deal with competition from third-party payment institutions, in terms of retail payment, as small merchants have become increasingly unwilling to use POS (point-of-sale) machines due to higher bankcard swipe fees."

He said that UnionPay is likely to replicate its existing offline rules on bankcard fees, merchant administration and risk management, and apply them online.

"Whether or not it will succeed in the market is hard to say, considering that Alipay and WeChat Pay have taken a dominant share of the market. Not to mention that these two payment service providers can provide more payment scenarios through e-commerce, social networking and vertical applications than UnionPay and commercial banks," he said.

Wang Pengbo, a senior analyst with Analysys, a Beijing-based provider of big data analyses, agreed.

In e-commerce and social networking, Alipay and WeChat Pay definitely have an advantage now, he said.

"With UnionPay and its member institutions gradually expanding their market share in this field, the competition based on consumption scenarios will grow more intense," Wang said.

He noted that the UnionPay standards will also promote the protection of personal information and money security.

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Permalink 01:04:24 pm, by dacare, 237 words, 465 views   English (US)
Categories: News of China

China homebuilders see record-high auctioned land price: report

Chinese largest real estate companies witnessed record-high costs for purchasing auctioned land in the first 11 months of the year, evidence that their profitability might be squeezed in the face of recent tightening moves, an industry report showed.

The combined funds earmarked for purchasing auctioned land for property development by the 40 largest Chinese homebuilders in terms of sales volume stood at 1.01 trillion yuan (147.3 billion U.S. dollars) by the end of November, said Centaline Property, a leading Chinese real estate agency.

This translates into an average price of 6,062 yuan per square meter, surging 50 percent from the previous year, the report said.

The report was released after several measures were introduced to rein in speculative housing purchases, check the risk of asset bubbles and stabilize the market, with dozens of Chinese cities modifying market rules, including the introduction of higher deposits and more purchase restrictions.

"More than 70 percent of these auctioned land plots are located in cities that have rolled out tightening moves, which presages sales and funding difficulties for some homebuilders," said Zhang Dawei, a Centaline Property analyst.

Observers believe that a surge in housing mortgage loans and auctioned land prices contributed to the sweeping increase in home prices across China earlier this year, triggering a string of policies to cool an overheated market.

Some Chinese local governments rely too heavily on land sales for fiscal revenue and deliberately slow supply to push up prices, experts have said.

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Permalink 01:32:02 pm, by dacare, 180 words, 362 views   English (US)
Categories: News of China

Shanghai Finance Forum to bring insiders on financial challenges and opportunities

Shanghai Jiao Tong University Shanghai Advanced Institute of Finance (SAIF) will hold Shanghai Finance Forum (SFF) on Jan 14, 2017, bringing together leading scholars, policy makers and practitioners to a common platform led by a Nobel laureate to discuss challenges and opportunities as China continues to develop its financial markets.

The SFF aims not just to identify the issues but also to come up with possible solutions through rigorous research, in-depth discourse and intimate interaction. Nobel Laureate Robert Merton and former governor of India's Reserve Bank Raghuram Rajan will deliver keynote addresses and participate in the panel discussions.

The SFF will bring together about 350 of the world's experts and leaders as guests, seeking to foster deep discourse, meaningful debate, and the fruitful exchange of ideas and best practices. The discussions will be underpinned by rigorous academic research, and guided by international best practice and experience, to condense actionable insights for policymakers.

It also aims to raise the understanding of international investors on China's policy actions and circumstances as they may be misinformed or ill-informed on the challenges and opportunities of the country.

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Permalink 01:31:03 pm, by dacare, 280 words, 318 views   English (US)
Categories: News of China

Sports unit of Wanda Group to seek listing

The sports unit of conglomerate Dalian Wanda Group will "eventually" get listed, Chairman Wang Jianlin said at a forum held in Beijing on Sunday, without giving a specific time.

Wanda will expand cooperation with international sports organizations and continue to seek opportunities in overseas acquisitions, said Wang, China's richest man, according to a report on on Sunday.

Wanda has been expanding its presence in the sports industry. In January 2015, it announced an investment of 45 million euros ($48 million) to acquire a 20 percent stake in top European soccer club Atletico de Madrid. In February 2015, Wanda acquired Infront Sports & Media AG, a leading sports marketing company based in Switzerland, for 1.05 billion euros. In August 2015, it acquired US-based World Triathlon Corp for $650 million.

Chinese companies have shown increasing interest in overseas sports deals, especially for soccer clubs. For instance, electronics retailer Suning Commerce Group Co in June bought nearly 70 percent of Italian soccer club Inter Milan for 270 million euros.

But Wang said that acquisition of sports clubs is only one aspect of Wanda's plans. The company aims to introduce more international sports events to China, according to the report.

Wang told the forum that he sees great potential in China's sports industry. While the total value of the U.S. sports industry accounts for some 3 percent of the country's GDP, China's sports industry only accounts for some 0.7 percent, according to the report.

Wanda has also made several major foreign acquisitions in the entertainment industry. It bought U.S. Legendary Entertainment for $3.5 billion in January and in November, it bought U.S.-based Dick Clark Productions for $1 billion. That company produces the Golden Globes film awards and the "Miss America" pageant.

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Permalink 01:25:55 pm, by dacare, 348 words, 386 views   English (US)
Categories: News of China, Manufacturing & Industry

Manufacturing PMI hits a two-year high

China's manufacturing purchasing managers index continued rising in November to the highest level in two years, which indicates the country's economic performance is gradually improving, new data showed on Thursday.

The PMI stood at 51.7 in November, up from 51.2 in October, according to the National Bureau of Statistics.

This is the fourth consecutive month that the manufacturing PMI, a key gauge that monitors the activity of large and medium-sized enterprises in the manufacturing sector, stayed above the 50-point mark that distinguishes expansion from contraction in the sector.

Among the five major subindexes, production and new orders stayed in the expansionary range. In November, the production subindex increased to 53.9 from October's 53.3, while the new orders subindex increased to 53.2 from October's 52.8. Both were at the highest level so far this year.

Zhao Qinghe, senior statistician of the NBS, said that production and market demand both rebounded in November, and enterprises showed stronger desire to purchase.

Zhao said the increased costs of raw materials and transportation, which have reached the highest level in three years, are a major challenge for enterprises.

"Fluctuations of the RMB exchange rate have resulted in the increased cost of imported raw materials, which has a significant impact on electronic equipment manufacturing industries such as computers and telecommunication," Zhao added.

The Caixin/Markit Manufacturing PMI, which mainly monitors the market performance of small and medium-sized enterprises, was at 50.9 in November. Although the index stayed in the expansionary range, it declined from 51.2 in October, which shows a slowing expansion pace in the manufacturing sector.

"Caixin/Markit Index readings for both output and new orders declined, but those tracking input and output prices rose at a faster pace to hit their highest levels in five years, pointing to further intensification of inflationary pressure", said Zhong Zhengsheng, director of macroeconomic analysis at CEBM Group, a subsidiary of Caixin Insight Group.

"The November PMI indicates that China's domestic economic operation is stable and the positive effect of supply side structural reform is gradually appearing," said Zhang Yiping, an economist with China Merchants Securities. "The quality of China's economic growth is gradually improving."

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Permalink 10:28:49 am, by dacare, 220 words, 300 views   English (US)
Categories: News of China

Chinese companies confident about future growth, interested in M&As: study

Most Chinese companies are confident about their revenue growth in the next three years, and nearly 70 percent of the interviewed companies are interested in mergers and acquisitions (M&As), according to a study report issued Monday on China's capital market.

The study, named China Capital Market Insight Survey 2016 and jointly developed by PricewaterhouseCoopers, BNY Mellon, ICR Inc. and Skadden, surveyed Chinese executives between July and September, receiving responses from 108 Chinese companies.

A majority of the executives are confident about their company's revenue growth in the next three years, the study showed. The executives were asked to rate their confidence in growth with figures from 0 to 10. Almost a quarter rated themselves 10, the highest confidence level, while three quarters were six or above in confidence.

The study also showed that Chinese companies have a strong appetite for M&As over the next 24 months. Among the public companies surveyed, 40.6 percent are interested in domestic M&As, while 28.1 percent are eyeing overseas deals. Meanwhile, private companies are also eager for M&As.

Chinese companies are accelerating raising capital in the global market, according to the study. While 43.8 percent of the public companies surveyed are planning to issue debt in the next 24 months, private companies rely more on equity investment, with 48.7 of them aiming to raise equity in the next 24 months.

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Permalink 12:58:13 pm, by dacare, 268 words, 270 views   English (US)
Categories: News of China

Home market seen stable in 2017

China's housing market is expected to be stable next year although regulatory risks remain high amid rapidly rising home and land prices, international ratings firm Moody's said in its latest forecast.

"We expect the growth in nationwide contracted sales by value to be flat or slightly negative in 2017, against a high base of contracted sales for 2016," said Kaven Tsang, vice president and senior credit officer at Moody's. "We estimate sales growth of around 25 percent year on year for 2016."

Tsang predicted that sales volume to fall by 5-10 percent next year as major cities in September and October imposed tightening measures, turning the sector outlook to negative. But the drop will be partly offset by a modest rise in prices.

If sales volume rises by above 10 percent annually on a sustained basis and in a low regulatory risk environment, the outlook could shift to positive, Moody's said.

A sharp price decline seems unlikely in the next six to 12 months, given the relatively low inventory levels in high-tier cities, Moody's said.

Developers' gross margin will stabilize next year due to reduced destocking pressure and improved selling prices, amid the strong contracted sales registered in the past 12 to 18 months, said Moody's, which rated 50 developers in China.

Late on Monday, Shanghai announced down payment for first-time home buyers would be raised to 35 percent from 30 percent from yesterday. People who now don't own a house but have applied for mortgages from either commercial banks or public housing funds anywhere in the country will have to pay a minimum 50 percent down payment as they are considered second-home buyers in the city from now on.

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Permalink 03:24:01 pm, by dacare, 681 words, 245 views   English (US)
Categories: News of China

China’s Top 30 firms post combined revenue up 55 per cent

China’s top grossing firms made 55 per cent more money in 2015 than two years previously, exclusive research by The Lawyer has revealed.

The Lawyer’s third edition of the China Top 30 report – an annual ranking and analysis of China’s leading law firms – found the combined revenue jumped from RMB12.95bn (£1.5bn) in 2013 to RMB20.16bn (£2.3bn) in 2015.

Revenue growth was largely fuelled by recruitment efforts including national expansion through regional bolt-ons.

The total number of lawyers in the top 30 firms increased by around 36 per cent in the same period, to 23,023.

In the two year time period many of the firms opened offices overseas or joined forces with established international firms.

Dentons (formerly Dacheng), King & Wood Mallesons (KWM) and Zhong Lun once again claimed the top three spots in the league table by total revenue, following double-digit revenue hikes.

Dentons, the biggest Chinese firm by revenue, saw its 2015 revenue grow by 29 per cent to RMB2.9bn from RMB2.25bn in 2014. KWM’s revenue increased at a slightly faster rate of 30 per cent to RMB2.1bn. Zhong Lun, the smallest of the top three, recorded the fastest growth, up 34.4 per cent to RMB1.98bn.

Below the top three, there were notable movements in this year’s top 30 firms by revenue list, including several new entries and exits. Shandong-based Jointide and Beijing-based JunZeJun dropped out of the table, while Shanghai’s Llinks and Shenzhen’s Guanghe made their first appearance.

Llinks posted a turnover of RMB236m after achieving a 50 per cent revenue? hike and claimed the 27th place as a result. Guanghe, riding on the country’s booming new over-the-counter equity exchange (new third board), which provides a speedy and favourable way of fundraising for start-ups, ranked 28th. It recorded a 69 per cent increase in revenue, from RMB136m to RMB230m.

The firms in the top 10 group remained largely unchanged on the previous year. However, AllBright, with a 48 per cent increase in revenue, moved up three places to fourth spot. Beijing-headquartered Jingtian & Gongcheng, with a 41.6 per cent revenue growth, made its debut in the top 10, replacing last year’s tenth high-grossing firm, JT&N.

Among the rest of the top 30 firms private equity and technology-focused Han Kun rose most rapidly, by six places to 17th. National giant W&H also moved up six places, to 19th. Beijing-based Tian Yuan was up five places to 11th, overtaking larger rivals such as Kangda, JT&N and Zhonglun W&D.

Some firms’ managing partners expressed concerns regarding continued growth prospects over the combing years, mainly due to China’s slower economic growth and greater uncertainty in some of the world’s largest economies.

However, many of the best performing firms expected to achieve a similar, if not faster, rate of revenue increase in the current financial year.

Top 30 by revenue (2015)
Rank 2015 Rank 2014 Rank Change Film
1 1 Equal Dentons (China)
2 2 Equal King & Wood Mallesons (China)
3 3 Equal Zhong Lun
4 7 increase AllBright
5 5 Equal Grandall
6 6 Equal Yingke
7 4 decrease JunHe
8 8 Equal Deheng
9 9 Equal Fangda Partners
10 13 increase Jingtian & Gongcheng
11 16 increase Tian Yuan
12 11 decrease Kangda
13 10 decrease JT & N
14 12 decrease Zhonglun W&D
15 17 increase Zhejiang T&C
16 14 decrease Zhong Yin
17 23 increase Han Kun
18 15 decrease Global Law Offices
19 25 increase W&H
20 18 decrease Longan
21 21 Equal Grandway
22 22 Equal Tahota
23 19 decrease Commerce & Finance
24 29 increase Haiwen & Partners
24 26 increase Beijing DHH
24 24 Equal Guantao
27 #### #N/A Llinks
28 #### #N/A Guanghe
29 27 decrease Co-Effort
30 30 Equal Hylands
Top 20 fastest growing firms by revenue (2015 vs 2013)
Rank Firm Two-Year Revenue Growth
1 Han Kun 185.7%
2 Guangdong Huashang 125.7%
3 Tian Yuan 117.8%
4 Beijing DHH 109.5%
5 Grandall 106.3%
6 Guanghe 98.3%
7 Zhong Lun 91.8%
8 Tiantong & Partners 90.0%
9 Zhejiang T&C 84.4%
10 Yingke 81.4%
11 Kangda 80.5%
12 Hylands 79.1%
13 Jingtian & Gongcheng 77.1%
14 AllBright 75.9%
15 Zhong Yin 72.6%
16 Dentons (China) 62.9%
17 Tahota 62.8%
18 JT & N 61.4%
19 Lifang 60.0%
20 Fangda Partners 58.3%
The Lawyer’s China Top 30 2016 report, released on 26 September 2016, identifies the top performing Chinese firms by various key metrics such as revenue, RPL, revenue growth and RPL growth last year.

The third annual edition of the report also contains three years of financial and technological data and indepth analysis on Chinese law firms’ strategies from some of the country’s most eminent lawyers.

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Permalink 01:35:15 pm, by dacare, 315 words, 317 views   English (US)
Categories: News of China

Big Black Friday discount to boost overseas online purchases

The Black Friday shopping season is expected to spur Chinese online purchases overseas despite the recent weakening of the yuan., a Shanghai-based e-commerce company dedicated to overseas products, has already rolled out special offers days before the shopping season and has seen rising sales compared with last year.

The company said it sold 60 million yuan ($8.67 million) worth of goods in the first 10 minutes when the sales started last Friday, a week earlier than the official start of the shopping season.

An 88,999-yuan Birkin bag was snatched up within two minutes and 320 Canada Goose jackets priced over 5,000 yuan were sold out in an hour.

The yuan further weakened on Thursday to pass the threshold of 6.9 against the U.S. dollar.

"The depreciation of the yuan does not dampen the frenzy of shopping abroad as most Western products on sale are still quite cheap compared with same products sold in franchised stores in China," Zeng Bibo, chief executive officer of, said on Thursday.

Chinese middle class shoppers are becoming increasingly sophisticated. "They want to buy high-quality products, enjoy good services and live a tasteful life," said Zeng.

The Black Friday shopping season seems a good opportunity for them to live such lives at a relatively low cost. The shopping festival is a period when retailers offer massive discounts to attract consumers.

Chen Tao, an analyst with Beijing-based internet consultancy Analysys, said Black Friday has been growing in popularity in China.

"But it is still in its infancy in China, and its size is quite small compared with China's homegrown online shopping festival Singles Day," he said.

"As Chinese middle class shoppers are becoming less and less price sensitive, what they care most about in cross-border shopping is the quality and brands of goods, fast delivery and good return policy, which will be the key areas for online retailers to work on," he added.

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Permalink 10:30:26 am, by dacare, 492 words, 308 views   English (US)
Categories: News of China

Weibo repositions itself as wide-ranging platform

Weibo, which is often called China's homegrown version of Twitter, is no longer satisfied with just tweeting.

As part of Chinese internet company Sina Corp, Weibo Corp is positioning itself as a combination of Twitter, Instagram and YouTube in order to gear up its development as a "social media platform", said the company's top executive.

Charles Chao, chief executive officer of Sina and chairman of Weibo, said that "apart from being a real-time information network, Weibo is also equipped with the features of social networking systems".

Chao said the major reason for Weibo's rapid growth in the past year was the string of adjustments it made in the process of repositioning its strategy. "The next move is to focus on connecting people and content. We will build a vigorous ecosystem that can attract more people from various backgrounds," he said to China Daily at the sidelines of the third World Internet Conference, which ended on Friday in Wuzhen, Zhejiang province.

Launched in China about seven years ago, Weibo for a time was the leader in China's cyberspace until its thunder was stolen by WeChat, an instant messaging app launched by Tencent Holdings Ltd in 2011.

But, Weibo's changing strategy has pushed it to the top once again thanks to its effort to attract young people and users in smaller cities. It allows them to demonstrate fully who they are via text-based tweets, self-generated videos and even live-streaming.

Statistics from data research firm QuestMobile show that Weibo had 390 million monthly active users in September, ranking fourth of all apps in China. Its growth rate was 79 percent year-on-year, the most rapid of the top 10 apps listed by the research firm.

Chao said that Weibo is more open compared with WeChat because its social networking features are not constrained to close friends. "It gives each account -- individuals, superstars, web celebrities and institutes --opportunities to demonstrate their views and their capabilities, to set up a business and to spread information and content to a much broader audience," he said.

"That is the magic of Weibo. It is a wonderland that can make a nobody into a somebody, as long as they have talent," he added.

Chao discussed the rise of the web celebrity economy on Weibo as an example. By interacting with followers on Weibo, a former magazine model known as Zhang Dayi has become an online sensation. Zhang's fame in the virtual world helped her set a record of selling 20 million yuan ($2.9 million) worth of clothes online within two hours.

"We will keep making efforts to empower our users," he said. In the online celebrity sector alone, Weibo is working with more than 300 multichannel networks to help online celebrities gain fans, boost influence and speed up monetization.

Chao said it invested in companies that can bring synergy with Weibo. For example, the company, which debuted on the Nasdaq in April 2014, has already invested in Yixia, a startup with strong technology in video and live streaming.

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Permalink 12:47:41 pm, by dacare, 524 words, 413 views   English (US)
Categories: News of China

Companies and Tsinghua work on vehicle communications standardization

Vehicle communication guidelines are set to be published by the end of this year, as wireless communication is now a fundamental technology for intelligent cars. So there needs to be a universal definition and standard.

Carmakers and Tsinghua University recently teamed up to define vehicle communication standards in order to help boost transportation safety and the development of vehicle intelligence. Communication standards are now included as part of the upcoming China Intelligent and Connected Vehicles Technology Roadmap.

"The development of vehicle intelligence requires the technologies of big data, cloud computing, and vehicle-to-vehicle communication," said Li Keqiang, director of the automotive engineering department at Tsinghua University.

A group was founded in October and is led by Tsinghua University, General Motors Co and Chang'an Automobile Ltd. Supported by the Society of Automotive Engineers of China, the group will exchange standards for vehicle-to-everything communication, or V2X, and complete a definition and demand analysis.

Industry insiders hope the group's work may help accelerate the application of intelligent transportation systems on a larger scale to prevent transportation accidents.

Yao Danya, professor of automation at Tsinghua University, said: "The focus of V2X communication is on improving transportation safety and easing traffic congestion."

Yao suggested that "China may accelerate the deployment of the technology, as long as local governments initiate the necessary infrastructure upgrades at high-incidence spots of traffic accidents."

V2X communications include vehicle-to-vehicle, vehicle-to-infrastructure and vehicle-to-pedestrian communications, and the technology supports Intersection Collision Alert and Emergency Brake Alert.

The deployment of V2X communications may elevate the overall efficiency of the nation's transportation by 30 percent, according to SAE-China's prediction. The United States' National Highway Traffic Safety Administration estimated the technology could help avoid 81 percent of traffic light accidents in the country.

V2X communication is the vehicles' language, so a complete set of communication standards is necessary for underpinning an intelligent transportation system using intelligent and connected vehicles.

Vehicle intelligence is based on the real-time calculation of big data collected by sensors and radars in the vehicle. The current solution uses a combination of an in-car computer and a cloud computing system.

The computer in the car reacts instantly to emergent safety threats. A lot more traffic information is uploaded through wireless connections to a cloud server for further processing, and the results are downloaded to command the vehicle.

The solution requires fast wireless connections to transmit big data in a flash and powerful enough servers to process the information in a brief period.

Gong Weijie, deputy secretary general of SAE-China, said: "The challenges to the intelligent vehicles' communication technologies are in the coordination among varied government bodies, including the Ministry of Transport, and the trans-industrial synergy among the mobile communication operators and equipment suppliers."

Carmakers have to join with communications operators and internet service providers. The State-controlled mobile operators are working on 5G mobile communication networks to fix the bandwidth bottleneck for data exchange.

The 5G data transmission, 100 times faster than 4G, is capable of transferring more data within a shorter period of time, and 1 million access points are planned to be built in each square kilometer, making V2X communication possible, according to China Mobile.

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Permalink 10:16:06 am, by dacare, 695 words, 324 views   English (US)
Categories: News of China

Alibaba sales to equal to fifth-largest economy

Challenges remain in cross-border trade and regulations

After setting a new record at the annual "Singles' Day" online shopping event, Chinese e-commerce giant Alibaba Group Holding will generate value that is equivalent to the fifth-largest economy in the future. Industry experts lauded the feat as "unprecedented" but also cautioned about future challenges.

The company surpassed 3 trillion yuan ($440 billion) in annual gross merchandise volume (GMV) for fiscal year 2016, a year-on-year increase of 27 percent, and it is expected to generate more than tens of billions in its daily GMV, mainly driven by this year's "Singles' Day," also known as double 11, shopping festival, Alibaba said in a press release sent to the Global Times during the weekend. Based on the current growth rate, the company will help create a "new economy" that combines billions of individuals and millions of enterprises worldwide, and size up to the equivalent of a GDP just behind the U.S., China, the EU and Japan, the release noted, without providing a timeframe.

A company's output can't be compared to a country's GDP, as the company still faces uncertainties in its corporate operations, but the business model that Alibaba has created will certainly have a significant impact on enterprises not only in China but also overseas, Zhang Yi, CEO of Guangzhou-based market research firm iiMedia Research, told the Global Times on Sunday.

"In the past decade, the e-commerce model has been playing a major role in solving the problem of asymmetric information in the marketplace, but it will focus more and more on how to better integrate online and offline sectors in the future, which will reshape global economic and trade landscape," he said.

Alibaba's business-to-consumer platform Tmall recorded a daily sales volume of 120.7 billion yuan on Friday. The 24-hour event this year covered 235 countries and regions, and 94 brands broke sales records of over 100 million yuan, the press release showed. For example, Japanese retailer Uniqlo surpassed 100 million yuan in online sales in less than three minutes, and multinational luxury goods conglomerate LVMH also exceeded expectations, for example its affiliated brand Guerlain broke monthly sales record in 12 minutes on the day.

Alibaba will maintain its growth momentum in the next five years as online retail has not reached the "growth ceiling" yet, said Liu Dingding, a Beijing-based independent industry expert. "Meanwhile, Alibaba is helping create hundreds and thousands jobs, which could also be seen as a contribution to the world development," he told the Global Times on Sunday.

Challenges remain

However, global trade has been sliding in recent years, and this year the growth will be the slowest since the financial crisis, according to the WTO estimates in September. To boost cross-border transactions, Alibaba included "buy globally, sell globally" in its strategy for this year's Double 11 shopping razzmatazz, which is in line with the group's founder Jack Ma Yun's proposal of building an electronic world trade platform (eWTP).

The eWTP would help small- and medium-sized enterprises (SMEs) overcome complex regulations, processes and barriers that hinder their participation in global commerce.

While pushing forward this idea, Alibaba has been facing mounting pressure from foreign regulators. For example, the U.S. Securities and Exchange Commission has recently probed the counterfeit goods on its platform, which could be seen as a result of the trade frictions between the countries, Liu said, noting however that there is no need to exaggerate the aftermath of this conflict, as the current success of Alibaba will eventually help the real economy, or the SMEs, to upgrade their business models and generate more profits.

Alibaba is not the only e-commerce giant that aims at connecting the world and trying to build a global business cycle, "U.S. e-commerce platform Amazon has been doing the same thing for years, but the outcome is not as good as expected," Zhang Yi said.

Zhang noted that like Amazon, the Chinese company's overseas business still accounts for a small part of its overall business due to barriers in international trade.

"Finding complementary areas for doing business is crucial for Alibaba, as shown by, another Chinese online supplier, which has purchased some of overseas retail marketplaces to better serve the diversified demand in China," he said.

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Permalink 02:18:24 pm, by dacare, 373 words, 382 views   English (US)
Categories: News of China

China's Singles Day offers big opportunity for British retailers

Forget Black Friday, said a Telegraph report, as China's Singles Day, the world's biggest online shopping day of the year, kicked off at 0:00 local time (1600 GMT) on Friday.

More than one billion U.S. dollars was spent within the first five minutes and the number has soared to 9 billion as of 8:00 local time (2400 GMT), according to Chinese media reports.

Singles Day, which started as an "anti-Valentine's" celebration for single people in China back in the 1990s, was adopted by China's e-commerce giant Alibaba in 2009 and has since become the world's biggest online shopping day.

Last year, Chinese consumers bought 14 billion dollars of goods from Alibaba's Taobao and Tmall in just 24 hours, which resulted in 467 million parcels being delivered after 710 million payments were made, said Telegraph.

The sheer scale of the market combined with the acute Chinese appetite for British goods has opened a significant new sales venue, the Guardian said in a report.

Topshop, a British multinational fashion retailer of clothing, shoes,make-up and accessories, saw its sales surge by over 900 percent in 2015, it said.

"These results clearly indicate how impactful this online calendar moment has become, and as a key focus market for the brand we see 11.11 as a great way to raise brand awareness and conversion in China," a Topshop spokesperson was quoted as saying by the Guardian.

Fung Global expects sales of British brands to surge this year, driven by a tailwind from Chinese online shoppers' demands for overseas goods, said Telegraph.

The Hut Group, which owns beauty sites and Protein World, said it expects sales to double compared to 2015 with brands offering 40 percent off haircare products, it said.

Vitamin retailer Holland & Barrett is hoping to make 1.2 million dollars from the event alone this year, it added.

Waitrose, a chain of British supermarkets, partnered with Chinese marketing and logistics company and has started exporting to China in April, selling through the Royal Mail shop on Tmall, said the Guardian.

"Singles Day is a big occasion for consumers and businesses in China and has the potential to give the products we offer more exposure and provide another opportunity to test demand for our brand," Nigel Roberts, Waitcose B2B growth and development manager, was quoted as saying by the Guardian.

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Permalink 10:58:33 am, by dacare, 315 words, 383 views   English (US)
Categories: News of China, Banking & Financial Services

China's finance industry embraces change

Bank of China chairman Tian Guoli speaks at the Bank of China - Bloomberg Global M&A Summit on Tuesday.

Mergers and acquisitions have accelerated the transformation of China's financial industry, according to leaders in the field.

Vice chairman and president of China Investment Corporation, Tu Guangshao told the Bank of China – Bloomberg Global M&A Summit on Tuesday that the sector was changing.

"The expansion from trade finance to acquisition finance will provide a strategic opportunity for development of the Chinese financial sector," Tu said.

"Acquisition finance requires financial institutions to adjust the content of services they provide, improve their product systems, increase the effectiveness of their organizational structures and put risk management well in place," he continued.

Zhu Min, former deputy managing director of the International Monetary Fund, said M&A is a crucial engine for post-crisis economic growth.

He said it will lead the global economy out of the gloom through supply-side restructuring.

In the first half of 2016, the volume of cross-border mergers and acquisitions led by Chinese buyers reached $149.2 billion, exceeding the total volume in 2015. The amount accounted for 23 percent of the total volume of global cross-border M&A, up from 6 percent in the same period last year, according to Tian Guoli, chairman of Bank of China.

"As the cross-border M&A by Chinese companies has entered a new stage, it is pushing forward the transformation and upgrading of China's financial sector," he said.

Bank of China has established an investment and loan linkage mechanism via diversified platforms and has 600 branches in 47 countries and regions.

"During the process of promoting industrial upgrade through cross-border M&A, Chinese companies should also pay close attention to potential risks to avoid shortsighted, irrational acquisitions that are seeking instant benefits," Tian said.

Certain M&A projects were overpriced and had problems with post-acquisition integration of businesses, he added.

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Permalink 10:35:35 am, by dacare, 146 words, 286 views   English (US)
Categories: News of China

Ad market reverses sales drop

China's overall advertising market edged up 0.1 percent in the first three quarters of this year, reversing from a 3.5 percent drop over the same period a year ago.

Traditional ad spending in the first nine months fell 5.5 percent, narrowing from the loss of 7.3 percent a year ago and a 6.2 percent drop in the first half of this year, CTR said in its quarterly report yesterday.

TV ad grew 1.4 percent in September, the biggest monthly gain since the start of this year, due to rising spending from key industries such as transport and real estate.

Newspapers saw worsening ad income which plunged 40 percent in the first three quarters, with property, commercial services and entertainment companies all cutting spending. Magazines also suffered a 29.9 percent loss in ad income from a year earlier.

Ad spending in movie theaters was the fastest growing sector in the first three quarters, jumping 57 percent.

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Permalink 10:45:41 am, by dacare, 161 words, 261 views   English (US)
Categories: News of China

Double-digit growth in Hangzhou

Hangzhou's gross domestic prod-uct for the first three quarters was 778.07 billion yuan ($116.13 billion), up 10 percent from a year earlier. The economy remained in the double-digit figures for six consecutive quarters, faster than the national average of 6.7 percent and the provincial aver-age of 7.5 percent, according to official statistics.

The city's service industry reported 475.19 billion yuan in added value, a year-on-year increase of 13.4 percent. The manufacturing industry achieved 281.54 billion yuan, up 5.4 percent while agriculture edged up 1.5 percent to 21.34 billion yuan.

The information sector, a key industry in the city's economic re-structuring, expanded 23.1 percent year-on-year to 186.58 billion yuan, and accounting for 24 percent of the city's GDP.

Retail sales rose 10 percent to 369.5 billion yuan, online retail sales jumped 29.3 percent to 210.7 billion yuan, and online consumer spending expanded 30 percent to 92.63 billion.

From January to August, the city registered 59,100 new companies, 26.3 percent more than the same period of last year. The average in-come for urban and rural residents reached 42,225 yuan and 21,404 yuan, respectively, up 8 percent and 8.4 percent.

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Permalink 10:43:18 am, by dacare, 427 words, 235 views   English (US)
Categories: News of China

Baidu executive resigns due to economic problems: media reports

Baidu Inc Vice President Li Ming-yuan resigned after he was reportedly accused of "economic corruption," said media reports.

The domestic Internet titan sent its employees a public letter via e-mail on Friday night, confirming "three blames" about Li.

First, it said, when Li participated in one of Baidu's acquisition projects, he had a "private economic exchange" worth an enormous amount, with the head of the company being taken over, the Beijing Youth Daily reported Sunday.

Second, within Li's business management scope, he had huge private economic exchanges with some partners in the game sector, the report said.

Also, Li didn't inform Baidu when other companies he held stakes had business links with Baidu.

"Li is a senior employee of Baidu and has made great contributions to the company … but nothing can be accomplished without norms and those who violate Baidu's rules will be strictly dealt with," the company was quoted as saying in the letter.

Li started his career in Baidu as an intern in 2004 and became the youngest vice president of the company nine years later in 2013 when he was 29.

Media speculated that Li was possibly involved in Baidu's acquisition of mobile application store 91 Wireless in 2013 and had since started to have economic exchanges with the latter.

After the acquisition, Li was assigned to be in charge of the Baidu mobile application distribution team, said media reports.

"The fact is that Li broke the company's rules, but the violations are not so serious that he will not be handed over to judicial organs," Li Chengdong, a Beijing-based independent analyst, told the Global Times on Sunday.

Currently, there is no firm evidence of which acquisition cases should be designated as those accounting for Li's private economic exchanges, said Li, the analyst.

Lots of netizens expressed doubts about the term "economic exchanges" mentioned in Baidu's letter and guessed that it meant Li was involved in corruption.

"I am not involved in corruption … do not underestimate Baidu's determination to tackle corruption. No matter who is involved in corruption, the company will call the police and discharge him and will never tolerate the mistake. No one can be an exception because this is the rule and the law, and it cannot be changed by someone's preference," Li was quoted as saying in his WeChat account on Saturday.

Li also said that the "economic exchanges" were normal economic exchanges and were not improper.

This kind of rule-breaking is often seen in Internet companies, noted Li, the independent analyst. "The vice president might have become a victim of political struggles in Baidu."

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Permalink 01:13:09 pm, by dacare, 360 words, 265 views   English (US)
Categories: News of China

Traditional retail business faces recession in China

Traditional retailing business is facing a severe recession in China as the Japanese department store Ito-Yokado closed another outlet in Beijing on Nov. 1.

On Oct. 31, only the first floor and the underground supermarket of the six-floor department store in the Shilipu neighborhood of Beijing were open for service. And the two floors closed early at 7:00 p.m.

The closing of the Shilipu outlet is of great significance to Ito-Yokado, as it was the group's first outlet in Beijing.

Cheng Ning, head of the publicity department of Ito-Yokado's Beijing branch, said that the outlet was closed mainly because its sales remained low even after business adjustments.

After the closure of the Shilipu outlet, Ito-Yokado only has two outlets and one food store in Beijing, and Cheng said Ito-Yokado will "try all means to ensure the smooth operation of the stores."

In the past three years, Ito-Yokado has closed seven outlets in Beijing without opening any new ones.

The situation is no better for other department stores nationwide.

So far, 29 listed department stores, supermarkets and chain stores have released their Q3 financial reports, and 16 of them registered decline in sales as compared to the same period of last year.

The Dalian-based Friendship Group and the Wuhan-based Zhongbai Holding Group reported bigger declines among the 16 companies.

The Friendship Group, mainly engaged in the retail, hotel operation and real estate development, reported quarterly revenue of 492 million yuan (U.S.$72.79 million), down by 23.67 percent yearly. In the first three quarters, its shareholders saw a total loss of 162 million yuan (U.S.$23.96) in net profits, down by 799.02 percent yearly.

The Zhongbai Holding Group, mainly engaged in retail and logistics businesses, registered a total revenue of 11.64 billion yuan (U.S.$1.72 billion) from January to September, down by 6.07 percent yearly. Its shareholders saw a loss of a loss of 174.82 million yuan (U.S.$ 25.86 million) in net profits, down by 201.39 percent year on year.

In contrast to the sluggish situation in traditional retail sector, China's e-commerce industry is booming.

China's e-commerce powerhouse Alibaba posted robust revenue growth for its second fiscal quarter ending Sept. 30. Its revenue growth rose 55 percent yearly to 34.3 billion yuan (U.S.$5.07 billion) for the quarter.

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Permalink 01:51:44 pm, by dacare, 456 words, 214 views   English (US)
Categories: News of China

Farmers use e-commerce to maximize profits

After harvesting potatoes on his plot, Hao Jinde saved some for his family to eat and sold the rest, over 500 kg, making 600 yuan (88 U.S. dollars).

Instead of peddling on the street as in the past, this year Hao sold them to a store belonging to the online shopping platform, Lecuntao, at his village in Jingle County, a potato growing region in northern China's Shanxi Province.

"Compared with selling to the local guys, I got about 50 yuan more," Hao said.

Lyu Yaofeng, manager of the platform's Jingle County branch, said the platform could purchase the potatoes at a higher price, as they would sell them for a much higher retail price to villages about 100 km away where they do not produce potatoes.

At the same store, Hao and other villagers now have direct access to pears and other produce that can be delivered to their village at lower than market price.

"Most of the produce online come straight from where it is grown, which ensures lower prices," said Li Erping, manager of the store in Hao's village.

Lecuntao is an e-commerce platform aimed at the rural market, which sets up physical stores in rural villages. Since it was launched in 2014, its physical store network has grown to over 70,000 villages in China's 25 provinces. Rural customers can either order online or make their purchases at the physical stores in their village.

While the Chinese government is advocating e-commerce in rural area as part of poverty reduction efforts, online shopping platforms, including Alibaba's Taobao and JD, are also expanding their services to rural villages, which have helped with sales of agricultural produce.

In late October, Chinese authorities for the Internet, national planning and poverty alleviation jointly released a plan on poverty reduction using the Internet, encouraging e-commerce in rural areas and promising to expand broadband coverage to 90 percent of China's poverty stricken villages by 2020.

According to the Ministry of Commerce, the number of online shops selling agricultural produce exceeded 1 million by September this year, bringing sales to 170 billion yuan, and they are expected to hit over 220 billion by the end of the year; that is 6.3 percent of total online sales, and a 35 percent increase year on year.

When farmers have difficulty selling produce, the Internet is now a major channel to turn to.

According to an official in Linxian County, a date growing area in Lyuliang, dozens of online platforms were used to sell slow-moving date stocks last year. Thanks to the online sales, date sales increased by 30 to 40 percent, saving local farmers from financial losses.

"The 'Internet+' concept has changed rural China," said Fan Wusheng, director of the poverty alleviation office in Jingle County. "With their produce sold online, farmers are now able to make maximum profits."

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Permalink 01:53:26 pm, by dacare, 145 words, 184 views   English (US)
Categories: News of China

Self-made chip rivals foreign ones

A Shanghai-based company yesterday unveiled China's first self-developed chips used in computers and servers and in the process broke the dual monopoly held by US chip giants Intel and AMD.

Cooperating with industry partners Lenovo Group and other domestic personal computer vendors, Shanghai Zhaoxin Semiconductor Co plans to sell 1 million computers with the new chip by 2018, said Ye Jun, chairman and chief executive of the developer.

"We don't want to replace Intel and AMD immediately at the current stage. But it does make sense that we have another choice from a Chinese chip designer," Ye said during an interview at the company's booth at the China International Industry Fair yesterday.

The advantage of the self-developed chip is its high-level security, which will be used in government bureaus, state-owned firms and the military. Lenovo desktops featuring the chip are already used in some local government bureaus.

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Permalink 01:41:07 pm, by dacare, 185 words, 176 views   English (US)
Categories: News of China

Rail-sea cargo service to slash costs

The new Taiwan-Pingtan-Europe rail-sea transport route will slash cargo costs between China's Taiwan province and Europe, an official from Pingtan in Fujian province said.

Once the services on the connected routes become regular, it will cut transport costs, said Qian Peng, deputy director of the transportation and construction bureau of Pingtan, which is part of the China (Fujian) Pilot Free Trade Zone established in 2014.

The trial run of the rail-sea link took place in November in 2015, which saw cargo transported from Taiwan Island to Pingtan, and eventually to Hamburg in Germany.

Pingtan is applying for the normal operation of the new link after the trial run.

Sea transport between Taiwan Island and Europe takes about 32 to 45 days. Air transport takes seven days but costs at least 10 times more than via the sea route. By comparison, the sea-rail link takes only around 13 days, Qian said.

Compared with the airlines, transport costs using the combined route are cut 80 percent for heavy cargo and 30 percent for light cargo.

The main products to be transported on the route will include electronics, seafood, hardware, and consumer goods from the island.

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Permalink 02:09:21 pm, by dacare, 223 words, 606 views   English (US)
Categories: News of China

China's electric carmaker BYD debuts budget light train

BYD, China's leading new-energy vehicle manufacturer, unveiled its first light train Thursday, a low-cost overground metro system suitable for hundreds of medium and small cities.

The train system, "Yungui," which when translated means Cloud Rail, costs one-fifth of a regular metro line and cuts the construction time by two-thirds, according to BYD chairman Wang Chuanfu.

He said compared to metro lines in Beijing and Shanghai, Yungui has been tailor-made for smaller cities or the tourist and commercial zones of big cities where a full-developed metro system is not viable.

BYD is one of at least five Chinese companies capable of producing urban light trains, said Zhong Jianhua, deputy director of the experts committee for China Association of Metros. The other manufacturers include China Railway Engineering Corp. and CRRC Changchun Railway Vehicles Co. Ltd.

Zhong said the light train was essentially "made in China" as about 90 percent of the equipment was produced locally and is expected to become a new driver for growth of China's rail transport sector.

More than 20 Chinese cities have subscribed to building such light trains with a combined rail length of 3,000 kilometers, Zhong said, adding that demand would boost the country's rail transport sector.

He said the China-made light rail had been equally welcomed in the developing world, particularly in Southeast Asia. Exports may begin when the market is mature.

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Permalink 11:48:36 am, by dacare, 298 words, 406 views   English (US)
Categories: Comp, Salary & Benefit


Real wages in China saw an annual average growth of 10.6% in the last 8 years, the highest among the G20 countries, according to a research report by Korn Ferry Hay Group.

China’s salary growth was followed by Indonesia (9.3%), and Mexico (8.9%). The worst were Turkey (-34.4%), Argentina (-18.6%), Russia (-17.1%), and Brazil (-15.3%). Growth averages for all other developed nations fell in between these figures.

“In the countries that are seeing tremendous salary growth, the issue is supply and demand,” Benjamin Frost, Korn Ferry Hay Group Global Product Manager, said. “With countries like China seeing a whopping 75.9% GDP growth since the beginning of the recession, universities and corporations simply can’t train people fast enough. This leaves an acute talent shortage and points to the reason skilled employees are seeing steep pay increases.”

The firm’s research focused on the G20, nations with the world's leading economies, and compared inflation-adjusted pay and GDP in each. The US fared poorest in pay recovery among Western developed nations. Canada’s recovery was the best, with 7.2% real salary growth on average and a GDP gain of 11.2%. Other developed nations experienced flat to modest real salary growth, with Australia at 5.9%, France at 5.2%, Germany at 5%, Italy at 2.4%, and the UK down 0.1%.

“While global economists point to this recovery overall as one of the worst in history, there are political, economic, and social reasons for the disparate salary fluctuations in different countries,” Frost said. “It examined how salaries have fluctuated globally since Lehman Brothers fell eight years ago, marking for many experts the start of the worst economic crisis and recession in generations.”

The Korn Ferry Hay Group pay data was drawn from the firm’s PayNet database, which contains salary and job data for more than 20 million workers in more than 25,000 organizations across 110 countries.

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Permalink 01:58:28 pm, by dacare, 656 words, 330 views   English (US)
Categories: News of China

Third-party payment licenses become increasingly valuable

Some see activity as way to expand overall business

The market value of third-party payment licenses, which help companies expand their business beyond online payments, will continue to grow in the short term in China, analysts said.

The People's Bank of China (PBOC), the country's central bank, stopped issuing new licenses in March 2015, and it has been enhancing its regulations of the third-party payment market. There are likely to be different impacts on different types of licenses, Mu Chu, an analyst from, a Shenzhen-based mobile payment intelligence provider, told the Global Times on Sunday.

"For example, a license for bill collection via bank cards will not be as valuable as before, as the profit margin in the bill collection business has been shrinking since the government lowered the bank card transaction fee," he said.

The PBOC cut commission charges and fees for bank cards on September 6, according to its website.

Under the new policy, card-issuing banks can't charge merchants more than 0.35 percent of the transaction amount for debit cards or more than 0.45 percent for credit cards, the PBC's document showed. Previously, the transaction fee varied among sectors.

The move will drive out some small online payment companies that make profits through counterfeiting point of sales (POS) machines with different categories to avoid transaction fees, according to an article published on domestic news portal in September.

A license that has multiple functions will be scarce but the most in demand, Mu noted Sunday.

"For example, a license that covers online payments, mobile payments and bill collection via bank cards that can be used nationwide will become more and more valuable," he said.

At present, 269 third-party payment companies have licenses, and authorities have come up with more severe measures to crack down on illegal online transaction activities since 2014, according to a report by Beijing-based market consultancy Analysys International.

"Regulators will become more and more cautious in controlling existing licenses, but considering the added value that third-payment licenses can offer companies, their value will continue to increase," Ma Tao, research director of the finance study at Analysys International, told the Global Times on Sunday.

A license cost about 50 million ($7.5 million) to 80 million yuan at the beginning of 2015, but it now costs more than 400 million yuan, the China Business Journal reported on Saturday.

Many licenses have been bought and sold repeatedly as supply is limited but demand remains high, the journal said, quoting anonymous industry insiders.

"It's not a surprise that licenses are becoming so expensive, as they help companies access the online payment market initially then expand their business," Li Chao, a senior analyst at Beijing-based research firm iResearch, told the Global Times on Sunday.

More and more companies are willing to pay more for licenses as they see the importance of the online payment market, and mergers between companies are aimed at offering a complete line of payment services, Li Zijian, vice president of Beijing-based third-party payment provider, told the Global Times on Sunday.

"Online payments enhance the connectivity between companies and customers and increase customer loyalty, which implies marketing opportunities," Li said.

Since the beginning of 2016, 14 merger and acquisition deals have been undertaken to get online payment licenses, according to the journal. For example, Midea Group Co spent 300 million yuan to buy Shenzhen-based third-party payment service provider Shenzhou Tongfu in August, a way to enter the online payment market, reported in August.

However, the growth of China's third-party payment market will slow in the near future. Total transactions in 2016 are expected to be 23 trillion yuan, representing a year-on-year growth of 52.8 percent, compared with 800 percent growth in 2013, the Analysys International report showed.

Companies should not look at obtaining online payment licenses and providing related services as an end in itself, as the market is close to saturation, Li noted. "To get more profit from the license, they should do more than offer online payment services," he said.

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Permalink 01:53:47 pm, by dacare, 452 words, 578 views   English (US)
Categories: News of China

China pledges to streamline administrative approval, ease rules for foreign investors

The Chinese government on Saturday decided to streamline administrative approval, delegate more power to lower government levels and loosen rules on foreign investment in an attempt to revive the economy.

Premier Li Keqiang called for efforts to cut red tape and simplify procedures for new investment projects, according to a statement issued after an executive meeting of the State Council.

Provincial governments will approve investment projects related to container terminals, vehicle engines, urban transit systems and inland water transportation, according to the new regulations.

The China Railway Corporation will be allowed to make decisions regarding railways, bridges and tunnels, the statement said.

More private investment will be encouraged in various sectors, including medical care, education, culture and sports.

China will prohibit new projects related to industries struggling with overcapacity, such as steel, coal and electrolytic aluminum sectors.

In principle, no new gasoline-powered vehicle factories will be allowed to open.

In 2013 and 2014, the central government moved a raft of administrative approval procedures, and delegated approval power, to lower government levels.

The meeting stressed measures to improve the country's business environment. More efforts are needed to create a level playing field for both domestic and foreign companies, the statement said.

Following China's revisions to four laws regulating inbound investment last month, the meeting agreed that some administrative approvals will no longer be necessary for foreign investors setting up businesses on the Chinese mainland.

Such investors are now only required to report business plans to local regulators, as long as their business is not on a "negative list." The government estimates that this means more than 95 percent of procedures will be cut.

The practice has been proved satisfactory in pilot free trade zones in Shanghai, Guangdong, Tianjin and Fujian.

Despite an economic slowdown, China remains an attractive destination for foreign companies due to the country's continued opening up as well as the improving business environment.

Foreign direct investment in the mainland during the first eight months of 2016 increased 4.5 percent year on year to 85.9 billion U.S. dollars, up from 4.3 percent in the first seven months, according to the Ministry of Commerce.

Altogether 18,538 new foreign-funded enterprises were established in the country over the same period, up 10.2 percent on a year earlier.

The government will continue to improve services and supervision to expand the country's opening up, the statement said.

In addition, the meeting pledged efforts to modernize agriculture, encouraging diversified business models and the mechanization and informatization of the sector. Financing support will also be increased.

China will also curb agricultural pollution by adopting strict rules on the use of fertilizers and additives, and strengthen the supervision of farm produce.

The government will work to enhance farmers'incomes and guarantee their urban housing demands, the statement said.

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Permalink 02:25:17 pm, by dacare, 423 words, 542 views   English (US)
Categories: News of China

Second Life in China English Teacher Recruitment Consultants Reveal The 4 Steps to Teach English In China

Any occupation that is associated with the learning, grooming and education of people is always highly rewarding, but along with the high rewards comes great responsibility. An English teacher in China job is similar; it involves interacting with people using engaging techniques to teach non-English speakers the English language. This is a reason why people looking to have a career as an English teacher should take a proper start to ensure a positive and rewarding career. The English teacher recruitment consultants at Second Life in China shared the 4 steps to teach English in China.

China is full of tremendous opportunities for English teachers “Demand for English teachers all over the world is growing quickly. As more countries interact with each other through business and other types of communication, the need for English speakers in foreign lands is growing. And nowhere is this need greater than in China.” - explained Second Life in China expert.

The first step of any major life altering step is to arrive to a decision about wanting to do something, similarly, when someone wants to teach English in China they should make up their minds and get ready to take a life changing plunge. By choosing to work in China, people will have an amazing chance to travel abroad and immerse themselves in the rich Chinese culture, also have the opportunity to learn new things including Mandarin Chinese and a new way of life. Additionally, English teachers in China are able to earn enough money to lead a comfortable life and also travel in China. According to experts, the salary benefits of teaching English in China include: A monthly salary of between 8,000-22,000RMB. The benefits include free flights, free housing, bonuses, airport pickup, and a Z visa, among other perks.

The second step of the process is to learn about the requirement and arrange all the necessary documents and make sure to fulfill all the requirements aid out by the Chinese State Administration for Foreign Expert Affairs before moving ahead with the plan. At this point, in the 3rd step is to contact Second Life in China, as one of the best recruitment agencies of the regions the company works with English teachers and schools to find a good fit for both parties. The consultants provide guidance and help in finding the right English teaching jobs in china and in settling down in China upon arrival.

The fourth and final step is to start enjoying the unique experience of living and working in china as an English teacher.

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Permalink 11:02:00 am, by dacare, 542 words, 392 views   English (US)
Categories: News of China

Huawei sees AI as mainstream strategy for solving problems

Won't duplicate Google's emphasis on consumer products

Chinese telecommunication giant Huawei Technologies Co sees artificial intelligence (AI) as an effective way of solving its own problems, which is a different path compared with other companies such as Google, experts said on Tuesday.

Huawei is focusing on how to apply AI to its own network to establish a global technology service to ensure network maintenance and breakdown diagnosis, which is different from what Google is doing, Xiang Yang, an industry expert at Beijing-based CCID Consulting, told the Global Times on Tuesday.

"For example, by using AI, Huawei could solve a network problem in Africa via tele-control," he said, noting that the disruptive technology will become the company's troubleshooter and help it increase its effectiveness.

Xiang made the comment after Ren Zhengfei, CEO of Huawei, said that the company will use "American bricks to build a Chinese Great Wall." He made the comment during a speech at Noah's Ark Lab, the company's research lab, in August, according to a transcript of the speech posted on the company's unofficial WeChat account on Sunday.

A huge global market of the network inventory is the best "stage" for AI, Ren said in the speech, noting that the company's trillion-dollar market requires more skillful and experienced staff in maintenance. And given this situation, AI has much potential, the transcript showed.

AI could help experts save time and focus on 10 percent of all problems, leaving the rest to automation, Ren noted.

The global market scale of the AI sector will reach nearly 119 billion yuan ($17.9 billion) by 2020, and the Chinese market will reach 9.1 billion yuan, according to a report published by Beijing-based industry consultancy iResearch in February.

So far, nearly 100 start-ups are focusing on this disruptive sector, which covers industries like industrial robots, service robots, intelligent hardware and cognitive technology, the report said.

And BAT - the domestic technology trio of Baidu Inc, Alibaba Group Holding and Tencent Holdings - have already entered the AI field but with different focuses.

Huawei will focus on "a mainstream course" and not come up with some "consumer products to earn some money," Ren said during the speech.

Applying AI to a product designed for the public is not in line with the company's core business, Zhao Ziming, an industry expert at Beijing-based consultancy Analysys International, told the Global Times on Tuesday.

"The company is striving to use AI technologies to improve the user experience," he remarked.

Huawei holds a positive attitude toward working with other companies in the AI sector, not only Chinese counterparts but also those overseas, Zhao said, noting that foreign companies have more advantages in this type of technology.

There is no need to compare Huawei with US tech companies like Google in developing AI, Xiang said, as the Chinese company is more focused on the application of some technologies in its own field. Meanwhile, the US company is stepping up efforts to make technological breakthroughs.

"But the two, along with many others in this field, should make AI fit into their own corporate strategies," he noted.

"For example, Google sold its robotics division Boston Dynamics to Toyota a few months ago, which showed that the company has to first figure out the purpose of working on AI," Xiang explained.

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Permalink 11:03:26 am, by dacare, 556 words, 364 views   English (US)
Categories: News of China

Domestic car manufacturers aim to become more premium than peers

A Borgward BX7 is displayed at an auto show in Haikou, Hainan province, on Sept 10.

More domestic car brands have demonstrated their eagerness for recognition as premium, although none of the Chinese peer group have yet revealed a strategy that will lead them to the top. Although there are previous failures that serve as lessons from which the industry can learn, some of them might still not find the keys to customers' hearts.

Geely Automobile Holdings Ltd expressed its ambition to build premium lineups on its first universal platform. Meanwhile, Beijing-based Beiqi Foton Motor Co Ltd is offering an SUV carrying the originally Germany Borgward badge at a price of up to 300,000 yuan ($44,979).

When companies talk about "premium", they usually mean a "premium pricing strategy", setting the price of a product higher than similar products, as an attempt to seek maximum profit in a segment where customers are willing to pay extra.

Theoretically, a customer would settle the bill when he or she perceived the difference between the product and other similar ones, when there are limited alternatives, or when production costs could not be lowered.

But Geely and Borgward, which are looking to climb up the premium ladder, need a halo effect to persuade customers during their decision-making process. In the automotive field, customers' feelings and thoughts reverse primarily due to trend-setting designs and cutting-edge technologies.

A well-known example of this comes from Volkswagen's China business. The company shifted its mass models well away from its peers after boasting its unique "T&D" powertrain, which consists of a turbocharged engine and direct shift gearbox.

Chinese customers perceived the difference, as T&D doubled the vehicle's fuel economy and so halved its petrol consumption. There is no comparable function in the market, at a time when the gasoline price has hit 8 yuan a liter. So, customers are willing to pay a higher amount for a compact Golf or Sagitar, as high as some other international brands' mid-size models.

There were of course other factors that helped Volkswagen move upward, as these models and the DSG feature stepped down from the altar. But can we name one or two factors helping Geely go premium? Does Geely possess any superior difference from other premium rivals to convince customers to pay much more?

Geely's jointly developed compact modular architecture platform and the input from a Swedish design lead team are impressive, thanks to its connection with Volvo Cars. Looking back, Geely Automobile has successfully become far more premium than it used to be. But, when we look around in the overall premium segment, at least in the eyes of the Volkswagen fans, Geely today remains in need of something new to match Volkswagen's T&D offering.

As for the revived Borgward brand, it is already a success for Beiqi Foton, a business vehicle maker who might not have expected much. The automaker could apply a strategy to enter the passenger car market, to become as high profile as possible. After it has attracted enough potential customers that understand the brand, a later downgrade could be possible to achieve greater volumes.

Also, Borgward could learn from the Sino-Israeli joint venture Qoros Automotive Co Ltd, which cut its suggested retail prices by as much as 50,000 yuan last year after claiming to be premium since it was established in 2007.

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Permalink 03:02:28 pm, by dacare, 678 words, 439 views   English (US)
Categories: News of China, Opinion and View

Chinese graduates should intern instead of job-hopping

Amid the massive enrollment expansion of Chinese universities since 1999 and the global economic downturn, finding a desirable job in China is not easy for most new graduates.

Statistics show that only 62 percent of 177,000 graduates in Shanghai found jobs upon graduation in 2015, resulting in high unemployment rates in the city.

Ironically, more than half of all recent Chinese graduates in first-tier cities end up quitting their new jobs within the first two months, according to the figures released by recruitment platform

A large percentage was said to be dissatisfied with their salaries while others sought work that would allow them to better improve their skills. A small number ultimately decided it would be easier just to return to higher education or go travel.

Analysts are trying to uncover the real reasons behind this bizarre trend of graduates giving up so soon after entering China's job market.

Some say that post-1990s and millennial-generation Chinese are notorious for being quick to quit, and others are outright criticizing them for being spoiled, immature and impatient - hallmark personality traits of today's young Chinese.

As a university student in my senior year, I can offer some perspective into this perplexing trend. You see, after spending our entire childhoods preparing for gaokao (the national college entrance exams) followed by four years in a university, it's understandable that many Chinese grads would prefer time off to play, travel, party or simply rest before diving into a lifelong career.

Additionally, as my fellow intern, Zhang Qin, here at the Global Times Metro Shanghai wrote in a recent TwoCents article, "Chinese students tend to sacrifice their personal interests in order to get accepted by a better-ranked university that may not offer their first choice of majors ... the decision of which major to pursue is usually influenced or wholly decided by our parents or teachers."

This, then, is also why so many Chinese grads find themselves feeling dissatisfied or downright depressed about their new jobs. It doesn't help that we are pushed by our families into a profession for which we may have no passion, leading to compromising our personal happiness.

Choosing a vocation and dedicating our lives to it is not as easy today as it was for our parents and grandparents. More options, along with more educated, eligible candidates, mean that most of us will have to enter a job at the very bottom, settling for minimal salaries.

Nonetheless, a few uni students I know are one step ahead of the rat race. There's a girl in my grade who has attended six internships throughout her undergrad years in order to identify a career she will be most competent in, then narrow down which specific company she'd most prefer working for. She is a true inspiration not just to our generation but to me personally.

This leads to my own internship here at the Global Times. Originally hailing from North China, I came to Shanghai to study because it is an ever-evolving metropolis full of opportunities.

Over the past three years I have tried to take advantage of all my spare time; instead of lazing around my dorm room, I have worked a number of part-time jobs and internships. I originally wanted to be an English interpreter, but my current internship as a journalist has allowed me to expand my horizons.

Quitting a salaried job right after starting is a permanent blight on your dossier; prospective employers will see how unreliable and irresponsible you are and probably not want to take a chance spending time and money on training you if they think you are just going to jump ship.

Indubitably, more than high scores or skill sets, what recruiters seek in young candidates are loyalty, persistence and strong character.

Yes, older companies may want to consider altering their archaic business models and outdated recruitment practices to better suit the impatient mind-sets of millennials; after all, it is us who will soon be taking over those companies.

But until then, it is wholly up to undergrads to prepare themselves for today's uncertain job market.

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Permalink 10:52:29 am, by dacare, 349 words, 338 views   English (US)
Categories: News of China

City acts to find jobs for college graduates

HUMAN resources authorities in Shanghai signed a contract yesterday with 51 local state-owned enterprises to help unemployed college graduates to find jobs.

Public employment agencies around the city will use the cooperation scheme to help the participating enterprises, including Shanghai Municipal Investment Group Corp, Bright Food Group Co, Shanghai Shendi Group Co and Shanghai Airport Authority, with recruitment as well as providing graduates high-quality job opportunities.

“The program is an addition to our regular recruitment methods,” said Song Haiwen, director of the human resources department of Shanghai International Airport Co.

“Students who graduated without jobs are not necessarily all incapable,” he added. Some might not have found suitable positions and some might have lost their jobs through no fault of their own. “We hope to offer them one more chance.”

The event also kicked off the month-long activities organized by Shanghai Human Resources and Social Security Bureau this month on the theme of “service for college graduates.”

The bureau’s branches in 16 districts will register students’ details and their needs, such as recruitment ads, internships, training and even psychological consultation to provide targeted services.

A total of 110 job fairs will be held this month, offering 16,000 jobs.

The annual event serving college graduates is organized to improve their employability. By the end of last June, nearly 75 percent of the 187,000 graduates of local colleges this year would have found jobs, according to local education authorities.

Xu Hongjue, director of the employment promotion center in Putuo District, said college students faced a number of problems in finding jobs.

“Many students lack the right self-positioning. They have to realize the situation that college students are no longer so rare as decades ago,” she said.

Many employers also complained that young people were less loyal than in times past and were quicker to switch jobs, she added, while some students were not skilled at communication.

Xu also pointed out that some students lacked career planning development as well as a passion for working.

Further information is available on the website of Shanghai Human Resources and Social Security Bureau. (

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Permalink 11:14:56 am, by dacare, 525 words, 348 views   English (US)
Categories: News of China, Manufacturing & Industry

Baoshan, Wuhan Steel merger to create 2nd-largest manufacturer

China's top steelmakers will merge to create the world's second-largest steel entity, it was announced yesterday.

Baoshan Iron and Steel Co, Baosteel's listed company, will issue new stocks to the shareholders of Wuhan Iron and Steel Group to complete the merger, the two state-owned companies said.

Baoshan is ranked fifth in terms of world production capacity. Wuhan is 11th. After the takeover, Wuhan Steel will delist from the A-share market on the Shanghai Stock Exchange.

Baosteel Group is China's second-largest steelmaker, and along with Wuhan Steel will have a joint annual production capacity of more than 60 million tons, making it the second-biggest producer behind ArcelorMittal.

The new entity will be called China Baowu Iron and Steel Group. China Business News reported yesterday that the state asset watchdog had given its nod and submitted the merger plan to the State Council for final approval. Once approved, the market value of the new group will surpass 108.5 billion yuan (US$16.3 billion), and its total assets will be worth 700 billion yuan.

The merger is in line with Chinese government's efforts to overhaul its steel sector, upgrade quality and cut overcapacity. Chi Jingdong, deputy director of China Iron and Steel Association, said the central government wants to consolidate 60-70 percent of the nation's steel output into 10 giant groups to enhance their competitiveness.

Chinese steel demand slumped as the global industry has been battling overcapacity. The crisis has seen manufacturers in Asia, Europe and the US suffer huge losses and led to accusations of dumping.

Shanghai-based Baosteel's net profit plummeted 83 percent to 1 billion yuan last year, while Wuhan Steel lost 7.5 billion yuan, compared with a 1.3 billion yuan net profit in 2014.

An analyst said the merger between Baosteel and Wuhan Steel was "merely the beginning" of more such acquisitions in China's steel industry.

"Restructuring in China's steel industry is the trend and it's an unstoppable one," Chen Bingkun, an analyst at Minmetals and Jingyi Futures, told AFP.

Restructuring of another two Chinese steel giants, both based in northeastern province of Liaoning, Ansteel and Benxi Steel Group, is next on the agenda, Shanghai Securities News reported yesterday.

Ansteel is the world's seventh biggest mill, and Benxi Steel ranks 21st. The listed arms of the two groups suspended trading in Shenzhen yesterday pending statements on the report. Investors in Hong Kong cheered the news, with Ansteel shares jumping 2.81 percent yesterday afternoon.

"China is now trying to cut down its steel production through policy. Restructuring is another way. Once the merged giants form a monopoly, it will start to control production," said Minmetals' Chen.

"The result of this restructuring is to integrate China's steel industry and pave the way for China to export its steel capacity."

However, another analyst did not see China having an edge over global competitors like ArcelorMittal and US Steel.

"I don't think these mergers will be able to change the current market status of the world's steel industry," said Qin Jiawei, a Hangzhou-based analyst with Xinhu Futures. "China's high-end steel products don't have the competitiveness in the international markets. It's not the size of the company that counts. You cannot change the global steel market by just adding them up."

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Permalink 04:44:51 pm, by dacare, 307 words, 278 views   English (US)
Categories: News of China

China launches cyber security talent training nationwide

Authorities from Wuhan, capital of Central China's Hubei Province on Monday pledged to increase the number of scholarships to attract students pursuing cyber security, and run special recruitment for "maverick geniuses," which constitutes a part of nationwide efforts to train cyber security talent.

Li Shuyong, Wuhan government publicity department head, told the Cybersecurity Technology Summit during China Cybersecurity Week that the city government will cooperate with companies to cultivate the world's top cyber security talent.

Li said the local government will double the number of scholarships for cyber security majors and recruit top cyber security graduates in Chinese and overseas schools as well as from competitors at cyber security contests. She added it will also open a class for minors and run special recruitment for "maverick geniuses."

She also said the city government will establish an innovative evaluation system. Instead of taking exams, cyber security majors will be evaluated based on their performance and given priority to practical and entrepreneurship training.

The Wuhan government will also offer twice the salary and research funds to the best cyber security experts than those from other fields. They will also receive 2 million yuan ($299,823) in subsidies and a high of 100 million yuan in funding if they have typical technologies and can create a significant impact on the economy. China needs at least 500,000 cyber security talents, but only about 8,000 such majors graduate each year, said an education official at the 4th China Internet Security Conference in August.

In January, a training center for cyber security and communication talent was established in Sichuan Province, aiming to provide training for students and faculty in Sichuan and Hong Kong.

In February, China launched its first special fund for cyber security with an initial capital of 300 million yuan. The fund will be used to provide financial assistance to experts and teachers who specialize in cyber security.

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Permalink 01:24:29 pm, by dacare, 418 words, 287 views   English (US)
Categories: News of China

Demand rises for graduates

Domestic service majors from the first university in China to launch the course are so popular that many are approached by potential employers even before they graduate.

Jilin Agricultural University in Changchun, the capital of the northeastern province, which established the major in 2003, recruits about 60 students a year.

The employment rate for domestic service graduates has reached almost 90 percent and many earn decent money while still students, according to Li Lei, director of the university's domestic service laboratory. "As interns in the last semester before graduation, many have been able to earn 3,000 to 5,000 yuan ($450 to $750) a month."

According to a report published by MyCOS, an educational data and consulting company, the average monthly salary for graduates of the class of 2014 reached 3,487 yuan just six months after graduation.

"There is still a shortage of talent in the booming industry, so some companies come to our university to recruit," Li said.

However, only about 40 percent of graduates choose to work in the domestic service industry. That's because many of the original students were transferred to the major when they failed to gain entry to their preferred major, so they have no interest in the sector. However, the proportion has declined and the major is now the first choice of 50 to 60 percent of the students, Li said.

The university's domestic service department employs 13 teachers who are experts in a range of fields, including sociology, medical science, nutrition and management science. Half of them hold doctorates. About 60 percent of courses on the major are practical subjects, including designing and making clothes.

The university receives many visitors from other universities, and at least one university in Guangdong province and another in Hunan province have also established the major, Li said.

Li Juanhui, a junior student, said she chose the course because it is "a distinctive major--new, but promising" and there is "a shortage of talent in the industry".

She said many people still make "incorrect assumptions", and "it will require the efforts of several generations of teachers and students to overcome prejudice against the major".

The 21-year-old said she may begin preparing for exams for postgraduate study or to become a civil servant in the second semester.

Fellow student Dong Jian said he has come to enjoy the major, even though it was not his first choice.

However, the 21-year-old said he is confident about the sector's future so he may undertake postgraduate study or look for work at a primary or junior school as a teacher of courses related to family life.

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Permalink 11:06:31 am, by dacare, 158 words, 251 views   English (US)
Categories: News of China

China's express delivery sector sees strong growth

China's express delivery sector has grown steadily in the first eight months despite a slowing economy, according to the State Post Bureau.

Revenue for Chinese express delivery businesses hit 234.36 billion yuan (about 35.5 billion U.S. dollars) in the first eight months of 2016, up 43 percent year on year, said the bureau in an online statement.

A total of 18.27 billion deliveries were made during the same period, up 55 percent year on year, according to the bureau.

Despite a slowing economy, express delivery services have grown steadily as online shopping gains popularity in China.

China aims to nearly quadruple revenues of its express delivery market by 2020 in a move to boost consumption and services, as the economy slows with softening trade and investment.

The express delivery industry will have a target annual revenue of 800 billion yuan by 2020, according to a policy document released by the State Council last October.

The amount is nearly four times the 2014 revenue, which reached 204 billion yuan.

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Permalink 11:51:37 am, by dacare, 298 words, 322 views   English (US)
Categories: News of China

Baidu sets up venture capital firm for innovation in artificial intelligence

Baidu Inc announced Tuesday that it will set up an independent venture capital firm to focus on investing in early-stage high-tech innovative projects related to artificial intelligence (AI), augmented reality and virtual reality, according to media reports.

The company, named Baidu -Venture, has received the first round of funding of $200 million, reported on Tuesday.

Baidu CEO Li Yanhong will serve as chairman of the firm and of its investment committee. He will participate in the review and assessment of the projects, said the report.

Baidu Venture will operate independently from Baidu, with innovative assessment mechanisms to accelerate the decision-making process and boost the company's investment efficiency, domestic news portal reported on Tuesday.

Leading AI scientists, including those in Baidu, will be invited to serve as consultants, noted.

It is another milestone in Baidu's strategic move into the AI sector, which Li said "will be a core tool for remarkable changes in daily life, just as electricity was over a century ago."

He spoke at the Baidu World -Conference on September 1, the Xinhua News Agency reported the same day.

Allen Zhu, managing director of GSR Venture, said the AI sector "has already attracted investment from the capital market."

Zhu predicted that it will be "the next promising investment opportunity after the Internet."

In 2015, China's market for AI amounted to 1.2 billion yuan ($179.65 million), according to consultancy iResearch Consulting Group.

The sector is expected to reach 9.1 billion yuan in 2020.

Baidu is one of the pioneers in the field. Earlier this month, the company unveiled its AI system called Baidu Brain, which is able to recognize and process speech, images and words, as well as build user profiles, said Xinhua's report.

It launched the Institute of Deep Learning in 2013 to develop AI technology, noted.

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Permalink 11:59:26 am, by dacare, 537 words, 222 views   English (US)
Categories: News of China

Firms need to step up efforts on standardization, says official

Chinese enterprises should make more efforts to participate in international cooperation in standards to promote their overseas development, said Zhang Xiaogang, president of International Organization for Standardization (ISO).

"Chinese enterprises should pay more importance to international standards and increase awareness in participating in international standardization affairs," Zhang said in an exclusive interview with China Daily ahead of the 39th ISO General Assembly. "They should increase their familiarity of the rules on the formulation of international standards."

The 39th ISO General Assembly will open on Monday in Beijing, and delegates from all of the ISO's 163 members are expected to attend the meeting. This is the second time that the general assembly of the world's biggest organization for standardization has been held in China.

"The meeting will expedite China's participation in international standardization affairs, and play a role beyond measure in facilitating integration between China and the international community in economy, trade, science and technology, and other fields," Zhang said. "It will also greatly contribute to China's economic upgrade."

The technical standards, such as those for measurements and units, and industrial standards issued by the ISO have been widely adopted and have had far-reaching influence in global technological and economic development, Zhang said.

Participation into international standardization can help enterprises to master international rules, familiarize themselves with the latest technological development, increase their competitiveness and brings them economic benefits, he said.

China has made remarkable progress in international standardization in recent years. China led in the formulation of 182 international standards between 2001 and 2015. The figure was 13 between 1947, when the ISO was founded, and 2000, Zhang said.

Despite this progress, China still lags far behind developed countries in international standardization. Around 95 percent of international standards are made led by Western countries, he said. Only 0.7 percent of international standards were led by China, and these standards are mainly limited to industries in which China enjoys traditional advantages, such as fireworks, he said.

To reduce the gap, China needs intensified participation in the formulation of international standards, and the government should consider national plans for internationalization of Chinese standards, he said.

Meanwhile, the government should foster an incentive mechanism to encourage enterprises to cooperate with standardization research institutes to promote advantageous technical standards held by enterprises to become international standards, Zhang said.

In addition, enterprises should make more efforts to cultivate employees who excel in foreign languages, master certain fields of technology, and are familiar with the rules of international standards formulation, to improve international cooperation and exchanges in standardization, he said.

Meng Yongye, deputy director of the Center for International Language Service and Management, at the University of International Business and Economics in Beijing, said with more Chinese enterprises investing overseas, more Chinese technologies will also go overseas, and they should aim to internationalize their standards if they want to become world-class enterprises.

Less than 5 percent of Chinese standards have English versions, far below countries such as Japan and Germany.

China will take a series of measures to encourage internationalization of Chinese standards, such as encouraging enterprises and experts in the formulation and revision of international standards, and carry out mutual recognition of standards with China's major trade partners, Tian Shihong, director of China's Standardization Administration, said at a news conference in August.

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Permalink 10:59:41 am, by dacare, 478 words, 339 views   English (US)
Categories: News of China, Banking & Financial Services

Tens of Thousands of Jobs Go as China’s Biggest Banks Cut Costs

China’s four biggest banks reported that staff numbers fell by the most in at least six years in the first half, highlighting the possibility that employment has peaked at the firms that are the world’s biggest providers of banking jobs.
A decline of 1.5 percent from the end of last year left 1.62 million workers at Agricultural Bank of China Ltd., Industrial & Commercial Bank of China Ltd., China Construction Bank Corp. and Bank of China Ltd., earnings filings showed. Agricultural Bank, the No. 1 bank employer, saw its number of employees slip below half a million.
While a fall in the first half is not unusual, the 25,000-job decline is the biggest since at least 2010 and analysts at firms including BOC International Holdings Ltd. and DBS Vickers Hong Kong Ltd. say changes to how banking is done will limit prospects for increases.
“Chinese banks went through years of expansion, adding physical outlets that helped to push their staff numbers to a peak,” said Polar Zhang, a Beijing-based bank analyst at BOC International. He expects the workforce to “dwindle” on technological advances and cost cutting.

Chinese lenders take four of the top five slots for employment by listed banks around the world, ahead of the likes of Wells Fargo & Co., HSBC Holdings Plc, JPMorgan Chase & Co. and Citigroup Inc., data compiled by Bloomberg show. Russia’s Sberbank PJSC is in the top five.
Economic Slowdown
Lenders from Citigroup to Deutsche Bank AG have cut staff and costs in revamps since the global financial crisis.
While Chinese banks have avoided the multi-billion dollar fines for compliance breaches that have weighed on their international counterparts, they’re under pressure from an economic slowdown and a rising quantity of bad loans. Margins are falling as the government deregulates the industry and online and mobile players like Zhejiang Ant Small & Micro Financial Services Group -- also known as Ant Financial -- and Tencent Holdings Ltd. eat into their businesses.
Chinese lenders have generally reduced numbers by not replacing staff who leave, according to Shujin Chen, a Hong Kong-based analyst at DBS Vickers Hong Kong. Workers are departing in search of better pay, she said, adding that banks would need less staff as artificial intelligence and online and mobile transactions played a bigger role and lenders developed robots that would interact with customers.
Besides a reduced number of workers, the first-half data also pointed to pressure on pay. The big four banks’ combined staff compensation costs -- including salaries, bonuses, allowances and post-employment benefits -- fell 2.6 percent from a year earlier. At the mid-sized China Minsheng Banking Corp., the decline was 22 percent.

Flat revenue and rising pressure on asset quality means “banks have been pushing even harder in cost optimization,” Wei Hou, a Hong Kong-based analyst at Sanford C. Bernstein & Co., wrote in a note.
— With assistance by Jun Luo

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Permalink 11:30:28 am, by dacare, 384 words, 346 views   English (US)
Categories: News of China, Banking & Financial Services, Comp, Salary & Benefit

Banking Layoffs Continue in China as Salaries Slashed in First Half

The departures come as the banking industry struggles against strong financial headwinds.

China’s biggest banks have eliminated thousands of jobs in the past six months to June 2016, as the nation’s banking industry, despite avoiding the huge fines for compliance breaches that weighed on their Western peers, has seen a challenging year amid a sluggish economy, lower interest margins and top-down financial reforms.

Big banks in China have announced almost 1.62 million new job cuts this year, and thousands more are expected, as the wave of lay-offs that began in 2013 shows no sign of abating.

So far, 10 out of the 16 listed mainland banks have reported a headcount drop. The top six listed banks, which reported their weakest profit growth in a decade, have cut a combined total of 34,691 jobs in the first half of the year, the semi-annual reports of the banks showed. This marks the biggest scale of employee departure ever recorded in China’s banking sector, which has expanded uninterrupted over the past 10 years.

Salaries are also going down
According to several media reports, many banks have been easing staff for different reasons, with China Merchants Bank scaling back the most, cutting 10 per cent of its workforce. Bank of China said its headcount at the end of June 2016 had decreased by 6,881 to a total of 303,161 employees. Agricultural Bank, the nation’s biggest bank employer, lost 4,023 staff while Industrial and Commercial Bank of China cut back by 7,635. China Construction Bank also shed 6,721 staff to 362,462.

Besides a reduced number of workers, salaries are also going down as Chinese banks’ profits slid 3.5 per cent on the year, while the four state-owned banks reported profit growth below one per cent. In addition, the first-half data showed that Industrial and Commercial Bank of China, Agricultural Bank of China and China Construction Bank reduced their salary expenses, including salaries, bonuses, allowances and post-employment benefits, by 1.6 percent, 2.9 percent, and 2.18 percent respectively.

Compensation structures are generally different in Chinese banks compared to their Western peers. For example, the average annual income for a mid-level banker can typically range between $100,000 to $125,000 while similar international counterparts offer more than double those salaries. They also offer longer holidays and fewer travel curbs, while Chinese staff can only get five days annual leave and must request approval from authorities before being allowed travel abroad.

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Permalink 11:59:04 am, by dacare, 875 words, 261 views   English (US)
Categories: News of China

China's Belt and Road Initiative to stimulate Asian, global economic growth: Bangladesh economist

Belt and Road Initiative proposed by China could stimulate sustainable Asian and global economic growth, a leading Bangladeshi legal economist told Xinhua.

In an exclusive interview recently, MS Siddiqui, a professor at Dhaka's Daffodil International University, said the Belt and Road Initiative will connect countries that represent 30 percent of world gross domestic product (GDP), 63 percent of global population, and most of known energy reserves.


In particular, countries along the Belt and Road routes, especially those with underdeveloped infrastructure, low investment rates, and low per-capita incomes, could experience a boost in trade flows and benefit from infrastructure development, said Siddiqui.

The Belt and Road Initiative refers to the Silk Road Economic Belt and 21st Century Maritime Silk Road, in a bid to revive the historic trade routes by boosting cooperation between China and other nations.

The Silk Road Economic Belt revival project could involve more than 60 countries and regions.

According to the economist, Chinese investment in large infrastructure projects constitutes the basis of the China-led initiative, which consists primarily of infrastructure that facilitates east-west trade over land, such as railways, roads and pipelines.

China has committed a total of about 100 billion U.S. dollars to a trio of new infrastructure funds, allocating 40 billion U.S. dollars to the Central Asia-focused Silk Road Fund, 50 billion U.S. dollars to the new Asian Infrastructure Investment Bank (AIIB), and 10 billion U.S. dollars to the BRICS-led New Development Bank, he mentioned.

The vision document for the Belt and Road Initiative, goes well beyond just infrastructure, and envisions closer coordination of economic development policies, harmonization of technical standards for infrastructure, removal of investment and trade barriers, establishment of free trade areas, financial cooperation and "people to people bonds" involving cultural and academic exchanges.

Personnel exchanges and cooperation, media cooperation, youth and female exchanges, and volunteer services, are also major components of the initiative, he said.

"China would be able to better secure its energy and raw materials supply, which now predominantly gets shipped through the Strait of Malacca and the South China Sea as China is gradually becoming more influential economically and diplomatically. Eventually it will shift geo-strategically from a 'low-profile' international strategy and take on a far greater role in global affairs."

With the Belt and Road Initiative, Siddiqui said China as "a new great power is trying to supplement the international economic order."


"Bangladesh is in a strategic location between China, India and ASEAN countries and hence is well placed to be a trading and manufacturing hub. Bangladesh needs such increased connectivity with other economies in this region and China's Belt and Road Initiative will see the realization of this economic area."

He added that Bangladesh should seek more Chinese support to help develop more mega infrastructures and develop other facilities related to finance and technology.

"Following China's construction here of the multipurpose road-rail Padma Bridge bridge, we are expecting China to help develop a deep sea port," the economist said.

Bangladesh also needs Chinese support on regional and global issues and has invited China to be involved in regional issues with other relevant countries, he said.

Siddiqui went on to explain that the current infrastructure and energy sector projects bottlenecking in Bangladesh transpired mainly from a shortage of long-term investments.

The Bangladeshi government's budgetary allocations and long-term financing from local and foreign enterprises including banks, non-banking financial institutions and insurance companies, were not sufficient for maintaining the required investment for these sectors, he said.

"Bangladesh will have to spend between 7.4 billion and 10 billion U.S. dollars a year until 2020 to bring its power grids, roads and water supplies up to the standard needed to serve its growing population. In total, the country will require between 74 billion and 100 billion U.S. dollars between 2011 and 2020, or between 7.38 to 10.02 percent of its gross domestic product to improve infrastructure."

BCIM (Bangladesh, China, India and Myanmar) economic corridors will increase trade, transport, tourism and investment for Bangladesh, due to its strategic location between India and China, he said.

"The availability and affordability of workers and its geographical location are important aspects of Bangladesh developing into regional hub, yet it urgently needs a port, and related infrastructure to boost connectivity with other nations through ocean and land routes. The Belt and Road Initiatives will open up numerous opportunities for Bangladesh," said Siddiqui.


He said Chinese investment in large infrastructure projects constitutes the basis of the Belt and Road Initiative and emphasizes the commercial and open nature of the modern version of this network, he said.

He further explained that the ambitious programs of infrastructure construction along the main Asia-Europe shipping route will also result in connecting the world more efficiently.

"Firstly, China is gradually becoming more influential economically, diplomatically and geostrategically in regions close to Europe, therefore stronger investment and trade relations between China and countries in Africa, the Middle East and Central Asia are increasing China's stake in regional affairs, as friendly relations with Beijing increase," Siddiqui said.

"Secondly, the Chinese government has an increased ability to influence routes trade between China and the European Union. And in the long term it is likely that transport and supply chain routes involving Asia and Africa will increasingly bypass those of Europe," the economist concluded.

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Permalink 11:49:23 am, by dacare, 145 words, 252 views   English (US)
Categories: News of China

Chinese Job Recruitment App Raises RMB200 Million

Shanghai-based online recruitment app HunterOn says it has raised RMB200 million to expand its recruitment services to more sectors, including finance, healthcare and consumer.

UOB Venture Management, an investment arm of Singapore's United Overseas Bank Group, led the series C round, and existing investor IDG Capital Partners also participated in the round.

Founded in 2012, HunterOn provides a platform connecting recruiters and headhunters. Its web and mobile apps aggregate 20,000 headhunting companies and 60,000 headhunters, providing services to 30,000 companies.

The company previously raised US$10 million in a series A round from IDG and China Growth Capital in 2014. It completed a US$20 million series B financing led by Sequoia Capital with participation from IDG Capital in the same year.

The hiring of senior level professionals is mostly conducted via headhunters in China, and HunterOn is creating an Alibaba-like platform for human resources, UOB Venture Management said in a statement.

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Permalink 02:07:58 pm, by dacare, 435 words, 196 views   English (US)
Categories: News of China

Tencent is top Asian company

Gets big boost from mobile Internet services

Internet giant Tencent Holdings has become the company with the highest market value in Asia at HK$1.99 trillion ($255.8 billion), overtaking domestic rival Alibaba Group Holding and many time-honored brands in China, media reports said Monday.

It is also the first time that Tencent surpassed China Mobile, which is valued at $254 billion, to become the top company in Asia, domestic news portal noted.

Alibaba ranked third at $250.2 billion, followed by South Korea-based tech company Samsung Electronics Co at $229.4 billion, according to the report.

"Tencent's market value is based on its current and previous good financial situation, which is driven by the company's core businesses including advertisements, games, e-commerce and financial services," Li Chengdong, a Beijing-based independent e-commerce strategy -analyst, told the Global Times on Monday.

Tencent's first-half revenue reached 67.7 billion yuan ($10.21 billion), up 48 percent year-on-year, said the financial report released by the company on August 17.

Gross profit rose 40 percent year-on-year to 39 billion yuan, the report showed.

Tencent has benefited from China's fast-developing mobile Internet industry, which tops the world with 700 million to 800 million users, noted Liu Dingding, an Beijing-based independent industry analyst.

Li said that Tencent has a large base of active users who spend a long time on its products such as online chat tools QQ and WeChat, which makes its products unique in the era of mobile Internet.

Apart from its robust mobile game business, the growth of Tencent has been fueled by other activities such as video, digital reading, music, streaming media and Web ads, domestic news portal reported Monday, citing an industry study from JPMorgan Chase & Co.

Tencent's mobile game revenue will approach 40 billion yuan in 2016, up 89 percent year-on-year, the JPMorgan report said.

It also forecast that the revenue of Tencent's social network will increase 30 percent this year and 25 percent in 2017.

"Tencent's WeChat business also reported a great performance in recent months," Liu told the Global Times on Monday.

For WeChat, including Chinese version Weixin, monthly active users reached 806 million in the first half of 2016, up 34 percent year-on-year, said Tencent's interim report.

Weixin further penetrated into communication scenarios at work, with more than 20 million registered users of -Weixin enterprise accounts, which facilitate internal office automation operations, the report noted.

"The company will continue to boost such businesses as WeChat, cloud computing and big data," Liu said.

Tencent has much scope for growth in businesses like finance and e-commerce, experts noted.

"Tencent has become the biggest shareholder of Inc and will join forces with to further develop its e-commerce business, posing tougher competition for Alibaba," Liu said.

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Permalink 12:12:27 pm, by dacare, 333 words, 413 views   English (US)
Categories: Manufacturing & Industry

Manufacturing PMI slips as heavy flooding dents output

CHINA’S manufacturing sector weakened in July as heavy floods hit output, but private manufacturers did better than market expectations to record their first activity growth in 17 months, data showed yesterday.

The manufacturing Purchasing Managers’ Index fell to 49.9 last month, below June’s 50, according to the National Bureau of Statistics and the China Federation of Logistics and Purchasing.

The weaker pace of manufacturing growth reflected the impact from the recent massive floods along the Yangtze River Economic Belt, Australia and New Zealand Banking Group said in a research note yesterday.

It added that industrial production will be sluggish in the near term as the area’s output has been disrupted.

Factory output fell to 52.1 in July from 52.5 in June, and total new orders hovered just inside the expansionary territory at 50.4, but a dip from June’s 50.5, the PMI showed.

Meanwhile, the Caixin China General Manufacturing PMI, which reflects private and export-oriented manufacturing conditions, rose to 50.6, a better-than-expected performance and was up significantly by 2 points from its June reading.

This was the first growth in activities since February 2015, with sub-indexes of output, new orders and inventory all surging past the 50-point mark that separates growth from decline.

“The Chinese economy has begun to show signs of stability due to the gradual implementation of proactive fiscal policies,” Zhengsheng Zhong, director of macroeconomic analysis at CEBM Group, said in a note after the PMI report. China said last week that industrial profits rose at the fastest pace in three months in June, though gains were seen in electronics, steel and oil processing.

Economic data for the second quarter were slightly stronger than expected due to a housing boom and government infrastructure spending that boosted demand for materials from cement to steel.

“But the pressure on economic growth remains,” Zhong warned.

Analysts also viewed that July’s data “do not bode well for GDP growth” in the second half of this year, as the real estate sector which fueled growth in the first half may have peaked.

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Permalink 01:55:23 pm, by dacare, 216 words, 185 views   English (US)
Categories: News of China

Salary rise of 8-15% for skilled talents

SKILLED professionals in China are receiving an average pay rise of 8-15 percent this year as demand for talents continues in the information technology sector, ZW HR Consulting said in a report yesterday.

However, those “with desired skills such as leadership capabilities, on-the-job experience and language proficiency can receive up to a 25 percent rise in salary,” said Frank Yu, chairman of ZW HR Consulting.

He added that candidates are now getting 8-15 percent increase in salary.

The pay rise and growth in recruitment this year will continue to be as active as last year as employers pursue a small pool of workers with strong technical and business skills, the firm said from analysis of job placements and interviews with firms and job seekers.

The IT sector will continue to outperform and drive growth in 2016 as demand will be particularly high for specialists, mobile engineers and software developers, ZW said, adding that engineers in research and development are also highly sought-after.

“We anticipate high levels of hiring activity will continue throughout 2016. Many companies are still positive when it comes to their hiring activities,” said Yu .

Demand for professionals in digital marketing, client relationship management and e-commerce continues to exceed the supply of candidates as online businesses in China are set to grow rapidly, according to the report.

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Permalink 04:20:47 pm, by dacare, 111 words, 232 views   English (US)
Categories: News of China

GlobalSportsJobs works with China’s Alisports

GlobalSportsJobs, a specialist digital media and talent acquisition platform for the international sports industry, has entered into a partnership with Alisports to support the Chinese online sports marketing firm’s domestic and international expansion plans.

Under the terms of the agreement, GlobalSportsJobs will provide Alisports, owned by Chinese e-commerce giant Alibaba, with a range of digital talent acquisition solutions including the rights to advertise career opportunities across its multi-language platforms.

The partnership also sees GlobalSportsJobs help Alisports develop its international corporate branding through a range of content aimed at educating and inspiring professionals who are looking to further their careers in sport or make a transition into the industry from outside.

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Permalink 02:07:48 pm, by dacare, 303 words, 296 views   English (US)
Categories: News of China, Comp, Salary & Benefit

Survey: Shanghai salaries up 6.7% in 1st half of 2016

SHANGHAI employees saw their salaries increase 6.7 percent on average in the first half of the year, but the raise was the lowest of all China’s first-tier cities, according to a survey.

Pay rises in Shenzhen, Beijing and Guangzhou ranged from 7.1 percent to 8.8 percent, while the average level in second-tier cities was 7 percent, according to the survey by China International Intellectech (Shanghai) Corp.

It said 64 percent of Shanghai companies said they had increased pay for all employees, second only to Guangzhou, and no decreases were reported.

The state-owned human resources agency said the Shanghai increase was no surprise given that city pay levels were already high.

“The cost of employing people in Shanghai is very high after decades of fast growth,” said the CIIC survey center’s Pang Limin.

“The result matches our prediction of from 5 to 7 percent at the beginning of this year.”

Across the country, average pay rises dropped to 7 percent from 8.7 percent in the same period last year.

Pang attributed to the downward trend to China’s slowing economy.

Real estate replaced the Internet industry at the top of the pay rise list with an increase of 8.6 percent following a surge in house prices.

Pang said companies in Shanghai were entering a period of low pay rises as they had more mature human resources management systems with multiple staff incentives and flexible benefits, such as stock shares and allowances.

“Employers in other cities are learning such practices but they depend more on salary adjustment at this moment,” she said.

There were also more foreign ventures in Shanghai while Guangdong had more local private companies, which had the highest increase in the survey, Pang said.

Only 39 percent of companies surveyed in Shanghai said they would expand recruitment with budget increases for recruitment of 22 percent, both lowest of the four first-tier cities.

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Permalink 02:53:08 pm, by dacare, 1048 words, 332 views   English (US)
Categories: News of China

China Billionaires Chasing Electric-Car Talent Power Salaries

China’s biggest iPhone maker, largest e-commerce company and leading internet-video producer are all in the hunt to build electric cars -- and to grab the small pool of available talent to build them.
All of this is great news for marketing professional Ronan Lu, 32. The bidding wars see some workers earning double their peers’ salaries and others landing jobs with minimal experience, according to recruiters.

Jia Yueting Photographer: VCG via Getty Images
“Many companies offered me job opportunities with good payment, but I chose LeEco because I believe it has great potential,” said Lu, who left Toyota Motor Corp. to join LeEco’s auto division in Beijing last month. “Startup EV companies usually can offer a higher salary than traditional automakers. You can get good rewards from stock holdings in such companies.”
More than 200 Chinese companies -- with backers including Terry Gou, Ma Huateng, Jack Ma and Jia Yueting -- are developing 4,000 models of new-energy vehicles and unveiling prototypes at motor shows and home-electronics expos. Traditional automakers and a bevy of startups see opportunity in the government’s commitment to boost yearly sales of NEVs by a factor of 10 in the next decade.
China surpassed the U.S. last year to become the world’s biggest market for new-energy vehicles, a fleet comprising electric vehicles, plug-in hybrids and fuel-cell cars. Domestic automakers sold 331,092 units in 2015, according to the state-backed China Association of Automobile Manufacturers.

An electric car charging station in Beijing. Photographer: Qilai Shen/Bloomberg
In a country with some of the worst urban air pollution on the planet and a rapidly urbanizing populace, the government has set a sales target of 3 million units a year by 2025. China also is accelerating construction of charging stations to serve 5 million electric vehicles by 2020.
‘Prying Talents’
“Internet companies that want to make cars are prying talents from us, and other rival automakers are also trying to lure them away,” said Wang Jun, vice president of Chongqing Changan Automobile Co. “It’s not only bolstered human-resource costs but also changed people’s expectations about their future.”
For QuickTake explainer on cleaner cars, click here.
The positions in top demand include designers, software developers and engineers focusing on systems architecture and creating “smart cities,” said Shirley Xia, an auto-industry recruiter in Beijing for Aimsen & Company.

Recently, Xia and seven colleagues suspended all projects for 45 days to search for an engineer to design charging poles for electric vehicles. Their client, an auto parts maker, wanted someone with at least three years of experience but settled for a candidate with half that.
“For some positions that only emerged over the past couple of years, there aren’t that many talents in the market,” Xia said. “It’s challenging for us to find candidates.”
Salaries for key research-and-development workers have risen 30 percent this year, with some reaching 1 million yuan ($151,000), said Jennifer Feng, chief human resource expert at Shanghai-based 51job Inc. That’s almost 16 times the national average for urban Chinese, based on data from the National Bureau of Statistics.
DeLorean Doors
Park Piao left Changan Automobile to run the R&D department for startup Zhiche Auto in Shanghai. Zhiche’s chief executive officer is Shen Haiyin, who formerly worked for Chinese e-commerce company
“I received quite a lot of offers from all kinds of companies before I decided to join Zhiche,” said Piao, 38. “A startup company can be more focused on EV products and thus can achieve innovations more quickly.”
Zhiche displayed a concept electric SUV before the Beijing Auto Show this year, complete with DeLorean-style doors that flip up. Zhiche plans to release the car next year.
There’s also strong demand for branding and marketing specialists to help make household names out of startups with sights on initial public offerings.
Foxconn, Tencent
“Part of this EV startup bubble can be explained by hot money,” said Jochen Siebert, managing director of JSC Automotive Consulting in Singapore. “It reminds me a bit of the 1990s, when almost everything with internet or e-commerce was supported by private equity, and the stocks went through the roof.”
A lot of that money is being spent on recruiting for the corporate suite, with companies backed by some of Greater China’s richest people hiring top executives from rivals and from Silicon Valley to help distinguish themselves.
Take Future Mobility Corp., an EV-maker backed by Gou’s Foxconn Technology Group and Ma’s Tencent Holdings Ltd. The company hired Daniel Kirchert, who was president of Dongfeng Infiniti Motor Co., and Carsten Breitfeld, project manager for BMW AG’s i8 plug-in sports car. Then it lured more managers from BMW.
“It is such a huge opportunity and advantage to start from zero,” Kirchert said. “Our company offers a really big platform for talented people to reach their goals without hitting the glass ceilings they would have hit at traditional automakers.”
Tesla Challengers
Internet entrepreneur William Li’s NextEV Inc. hired Padmasree Warrior, Cisco Systems Inc.’s former technology chief, to lead its U.S. operations.

The Faraday Future FFZero1 concept vehicle. Photographer: Qilai Shen/Bloomberg
Jia’s Faraday Future Inc., an electric-car startup planning a $1 billion factory in Nevada to challenge Elon Musk and his Tesla Motors Inc., recruited Porter Harris from Musk’s Space Exploration Technologies Corp. Harris left Faraday earlier this year.
The presence of those high profiles usually attracts workers who can actually build cars. Only about a quarter of the 4,000-plus NEVs approved by the government are in production, according to a National Development and Reform Commission survey. Ma’s Alibaba Group Holding Ltd. is partnering with SAIC Motor Corp. on an internet-connected SUV called the Roewe RX5.
Yet public subsidies that can total 60 percent of an EV’s sticker price are helping fuel a manufacturing boom. For the first half of this year, China produced 177,000 NEVs, more than double the same period a year ago, the manufacturers’ association said.
“Talent is one of many things these EV startups need to get right,” Robin Zhu, a Hong Kong-based analyst at Sanford C Bernstein, said in an e-mail. “It may even be the most important, given how early stage many are at this point, and particularly given the realities of fund raising (investors back the best people).”
— With assistance by Yan Zhang, and Tian Ying

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Permalink 01:17:29 pm, by dacare, 329 words, 326 views   English (US)
Categories: News of China

Apple to build first R&D center in China by the end of the year

Reuters reports that Apple is to build its first research and development center in China, citing a statement by the official Chinese state broadcaster.

Tim Cook reportedly made the commitment to Vice Premier Zhang Gaoli, stating that the center will be built by the end of the year.

The pledge comes after the head of China’s industry and technology regulator in May told Cook he hoped Apple could deepen its cooperation with the country in research and development and stressed information security.

Apple likely has two reasons for investing in R&D within China …

First, Apple wants to be able to recruit the best research staff worldwide, not all of whom are willing to relocate to the USA. It has established – or is establishing – R&D centers in a number of locations around the world, including France, Israel, Japan, Sweden and the UK. A center in China has long been rumored.

Second, the company is seeking to establish closer ties to protect its interests in what is currently its second-largest market.

Apple has long had a somewhat precarious relationship with the Chinese government. China has in the past questioned the security of iPhones and banned government purchases of Apple products. More recently, China has said that Apple will be subjected to greater security scrutiny, its iBooks and iTunes Movies services were shut down by a government agency, and a Beijing patent office has ruled that the iPhone 6 copies a Chinese phone.

Reuters even suggests that Apple’s $1B investment in Chinese Uber competitor Didi Chuxing – key to Uber abandoning its own operations in the country – may have been partly motivated by political considerations.

Before Cook’s charm offensive in Beijing in May, Apple announced a $1 billion deal with ride-hailing app Didi Chuxing, a move many experts saw as an attempt to curry favor with Beijing.

Apple’s Q3 earnings report revealed that the company’s sales in China were down 33% year-on-year as it battles local brands.

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Permalink 01:29:09 pm, by dacare, 483 words, 304 views   English (US)
Categories: Opinion and View

Recruiting the right way in the digital economy

Managers seeking to meet the demands of the digital economy need to radically rethink how they recruit and develop their workers.
They should concentrate less on trying to fill vacant jobs or searching for prospective employees with particular academic or professional qualifications. Instead, they should focus more on attracting candidates with the skills the organisation needs – even if jobseekers come from different industries or lack some of the skills required.
These are some of the findings of the World Economic Forum’s 2016 Human Capital Report. The report makes compelling reading and offers valuable insight into how organisations can align their human capital requirements with the fast-changing digital economy. It examines how 130 countries around the world are developing and deploying their human capital. For the first time, the report’s authors have drawn on workforce information provided by digital employment exchanges and platform businesses. Contributors include LinkedIn, Upwork, in the US and Chinese firm Didi Chuxing. They’ve combined this information with a wide range of public sector data to produce a fascinating analysis of global skills and work trends.
Important findings for businesses include:
• Skill-sets are often a more accurate and consistent indicator of a recruitment candidate’s ability than job titles or qualifications, and can frequently be transferred from one industry to another. While data analysts in the market research and energy industries might have little in common there are strong similarities, for example, in the skills required for this role in the financial services and consumer retail sectors.
WEF report examines how 130 countries around the world are developing and deploying their human capital. Photo: Reuters
• Focusing on skills broadens an employer’s pool of prospective recruits and increases development opportunities for its workers. For example, only 84 000 of LinkedIn’s 430 million members record their job title as “data scientist” or “data analyst.” However, 9.7 million LinkedIn members possess one or more of the primary or sub-skills required by data scientists and data analysts. Around 600,000 have at least five of these skills. A modest investment in training could equip many of them for the role of data scientist or data analyst.
• Businesses can no longer act as consumers of “ready-made” human capital. They have a social responsibility to work closely with educators and governments to develop education systems that keep pace with an increasingly digital and dynamic labour market. Greater in-house development and training are also needed to enable workers to adapt to constantly changing skills requirements.
• Digital work platforms are accelerating the growth of the global “on-demand” workforce. However, most workers currently using these digital services were freelancing before they joined. Digital talent platforms still account for a very small proportion of the “own account” work performed in major economies.
• High talent mobility is shifting key digital skills between countries. Australia, Chile and the United Arab Emirates, for example, are gaining technology skills while Greece, Canada and Finland are losing them.

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Permalink 11:00:20 am, by dacare, 237 words, 285 views   English (US)
Categories: News of China

Pre-opening costs at Shanghai Disney drag down earnings

A general view of Shanghai Disney Resort.

Higher pre-opening costs at Shanghai Disney Resort partly contributed to a lower operating income of Walt Disney's international operations, according to a recent quarterly earnings report of the U.S.-based media conglomerate.

The lower-than-expected income of Walt Disney's international segment, dented by the costs of opening Shanghai Disneyland and lower attendance and higher operating costs at Disneyland Paris, was offset by an increase in domestic operations due to guest spending growth and lower costs, the report reveals.

Parks and Resorts revenues for the past fiscal quarter increased 6 percent to US$4.4 billion and segment operating income increased 7 percent to US$994 million, against staggering total quarterly earnings of US$2.6 billion, up by US$114 million over the prior-year quarter.

Disney's newest park in Shanghai, with a cost of approximately US$5.5 billion, has received close to a million visitors during less than a month after its opening, Disney Chief Executive Officer Robert Iger said last month.

Wang Jianlin, China's richest man and chairman of Dalian Wanda Group, a real estate and entertainment conglomerate, made a uncharacteristically bold remark prior to the theme park's opening, saying that "Wanda would make it impossible for Disney China to make profit in the next 10 to 20 years."

He also expressed doubt over the high cost of building such a theme park in China and believed that it would have to charge high prices in order to be profitable.

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Permalink 02:04:51 pm, by dacare, 466 words, 227 views   English (US)
Categories: News of China

BHP launches Shanghai app hub

City widely recognized as a global center for mobile application development

BHP Billiton Ltd, one of world's largest mining companies by market capitalization, has launched its new Mobile Applications Hub in Shanghai, in order to help its global operations enhance their productivity, increase efficiency and reduce costs.

Diane Jurgens, BHP Billiton chief technology officer, said the new hub is one example of the potential for technology innovation to improve the way the company works and benefit people and the company.

BHP Billiton's mobile apps hub in Shanghai will also support the company to work closely with its China partners, such as steelmakers, to improve visibility of the entire supply chain.

"About 70 percent of BHP Billiton's iron ore is exported to the Chinese market, so it is important to stay connected with Chinese clients, particularly the visibility of supply chain, from pit to railway, from ports to yard. Now we have technology team in China and we can stay better connected to our marketing team to meet clients' demands," said Jurgens.

One of the key issues for enterprises that want to move up the value chain is to attract talent to develop automation and innovation to improve proficiency, she said.

The company's $5 million apps hub will initially employ 50 technology applications designers. Shanghai is an ideal location for the hub as it is widely recognized as a global center for mobile apps development and has highly experienced, skilled workers and leading universities offering excellent programs in technology and engineering, she said.

Mobile apps in the field have helped the company reduce its costs.

A solution that allows files and data to be managed securely on a shared device in mines located in South America and Australia with 350 users sharing 85 devices and another 1,000 devices deployed to 5,000 workers will help BHP Billiton save $6.5 million.

Analysts said as prices of commodities such as iron ore and gasoline have been experiencing wild fluctuations in recent years, players in the resources sector have been making various efforts to reduce costs and improve productivity by using better technologies, a key move for companies to survive difficulties and grow.

"Many players have suspended investments to open new field. Instead, they seek to exploit potential by using better exploration technologies to increase productivities, or optimize the supply chain, manufacturing flows, or human resources deployment to reduce costs," said a research note from Guolian Securities Co Ltd.

BHP Billiton has not approved new investment in iron ore since 2011, while resources will be deployed more extensively in copper mining, according to the company's disclosure materials.

Jurgens said technologies will not only help reduce costs but also will significantly boost productivity, such as by using sensors to identify copper from waste in mines. Big data emerging from the process will help geoscientists better analyze information and improve exploration results.

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Permalink 01:35:40 pm, by dacare, 740 words, 265 views   English (US)
Categories: News of China

Making money in the home property boom

Real estate agents in Hangzhou are reaping the benefits of a boom in existing home sales, turning their occupation into one of the best paid this summer.

During the first half of this year, 52,889 existing apartments were sold, up about two-thirds from a year earlier and almost equal to total sales for the whole of 2105. Property agents, who normally get bonuses when they complete a sale, are earning an average of 12,326 yuan ($1,852) a month nowadays, according to industry analysts.

"I work almost every day," said Jason Huang, an agent in a real estate office in the Jianggan District. "I don't take breaks because that can mean money slipping away from my pocket."

In downtown areas, the average price of an existing apartment has risen to 19,652 yuan per square meter. In residential communities near sought-after primary and middle schools, prices have surpassed 20,000 yuan.

Brokerage fees vary according to the size of a transaction. Homebuyers typically have to pay 1-3 percent of the value of the apartment if a deal is concluded. On average, a real estate agent earns from 10,000-20,000 yuan on each flat sold.

"The income is much better than that of a typical white-collar office worker in Hangzhou," said Huang, who declined to reveal his earnings. "However, I do have to sacrifice weekends and leisure time for my job."

As a relative newcomer to the business, Huang said he has to familiarize himself with surrounding neighborhoods and find as many people as possible who want to sell their homes. He said he makes hundreds of calls every day to potential buys and sellers.

The most time-consuming part of his job is taking potential buyers to view apartments. On weekends, the number can triple from weekdays

"Sometimes, I take a buyer to visit a dozen flats in a day and all of them are rejected," said Huang.

"Selling a flat can take months or even a year. But once you are successful, if means money in your pocket."

Hangzhou's real estate prices have been rising for 14 months, influenced perhaps by the city's hosting of the G20 summit next month and the Asian Games in 2022.

Real estate activity in the Jianggan District has climbed 32 percent, according to Kanfang, a local real estate transaction website. That is followed by a 20 percent increase in Xiaoshan District and 19 percent in Yuhang.

In the Tier 3 city of Jiaxing in northern Zhejiang Province, the increase in real estate prices this month ranked first in the nation, according to the China Index Academy.

Veteran real estate agent Will Li said the ranking is not surprising.

Jiaxing sits at the border of Zhejiang and Shanghai, putting it only 30 minutes by bullet train from either city. In May, the government announced that Shanghai residents could use their housing accumulation funds to buy homes in Jiaxing.

"The new policy stimulated the local market," Li said. "Many sellers called to tell me they wanted to raise their prices. That means potential brokerage fees also rise."

Li owns a private real estate agency, operated out of a residential community. His track record in selling homes has made the agency popular with locals.

The boom in property is both gratifying and stressful for Li.

"It's really labor-intensive work," he said. "In addition to shuttling between houses, we have to deal with piles of contracts and sometimes resolve disputes between buyers and sellers. Yes, it means high incomes, but many of the younger agents burn out within three years.

Last month, two of his agents quit.

"More real estate agency chains are starting to open branches in the city, which means more competition and more stress for agents," Li added.

For his part, Huang said he plans to leave his current job next year and return to his hometown of Lishui in western Zhejiang, where he will open his own real estate agency.

"Hangzhou is saturated with agencies at present, so newcomers like me have to go elsewhere if we want to strike out on our own," he said. "However, the existing home market in Lishui is still full of potential. It's a great chance for me."

Huang is a young man with big dreams.

"I sell homes, but I can't afford my own house yet," he said. "I'm told that top agents can earn something like 600,000 yuan in just six months. I don't know if that's true or not. I am just saving my money to invest in my own business in Lishui."

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Permalink 01:55:53 pm, by dacare, 247 words, 233 views   English (US)
Categories: News of China

China’s 51job sees 10.2% revenue boost

Integrated HR services provider 51job, based in China, has seen revenues increase 10.2% amid “stable” growth in the country’s white-collar recruitment market.

The results were announced in unaudited financial results for the second quarter of 2016 ended 30 June 2016.

The results, published yesterday, reveal total revenues increased to RMB559.8m (£64.1m) on Q2 2015, with gross margin of 71.8% compared with 72.8% in Q2 2015.

Commenting on the results, Rick Yan, president and chief executive, said: “With the white-collar recruitment market exhibiting relatively stable, modest growth in this time of economic transition in China, our strategic focus remains on increasing online customer spend and improving cross-selling of our other value-added HR services.

“Our sales efforts to deepen customer engagement are bearing fruit as average revenue per unique online employer has increased on a year-over-year basis for five consecutive quarters.

“We will continue to execute our initiatives in a disciplined manner. We are making important investments to strengthen our sales and customer service infrastructure, expand our new targeted job seeker platforms and capture additional HR-related opportunities, all while maintaining a track record of sustained profitability.”

51job results at a glance:

Total revenues increased 10.2% on Q2 2015 to RMB559.8m
Online recruitment services revenues increased 11.2% over Q2 2015 to RMB373.1m
Other human resource related revenues increased 9.1% over Q2 2015 to RMB186.6m, which reflected the impact of a value-added tax policy change effective 1 May 2016
Gross margin of 71.8% compared with 72.8% in Q2 2015
Income from operations increased 4.7% over Q2 2015 to RMB128.2m
Fully diluted earnings per share were RMB2.9

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Permalink 12:10:05 pm, by dacare, 93 words, 265 views   English (US)
Categories: News of China

Northern Gas & Power launches radio recruitment drive

Energy firm Northern Gas & Power has taken to the airwaves to launch a recruitment drive for business account managers.

Radio Airtime Media, the radio advertising division of Media Agency Group, has launched a new North-East campaign on Capital FM to promote working at Northern Gas & Power. The 30-second radio commercials can be heard this summer as the energy supplier seeks to expand its businesses across new global offices.

The Newcastle-focused radio ads are targeting potential account managers, who will be interested in working at NGP’s North-East office on Gateshead Quayside.

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Permalink 10:58:07 am, by dacare, 314 words, 293 views   English (US)
Categories: News of China, Banking & Financial Services

KPMG listens to graduates and changes hiring process

Streamlining its recruitment processes for millennials makes good business sense for KPMG, as it proves the professional services firm has listened to feedback, says a spokesperson.

The comments come after news that KPMG has cut back on its recruitment processes for millennials, as Recruiter reported earlier this week. The firm has condensed its traditional three-stage recruitment process of first interview, assessment centre and final interview into a single day.

KPMG’s new streamlined approach, known as Launch Pad, also enables students to gain new skills, network with existing KPMG staff and partners, as well as their peers.

The firm’s move follows research carried out with market research company High Fliers Research that showed millennials were frustrated by lengthy recruitment processes (34%) and poor communication from their potential employer (43%), with over half complaining they did not receive any feedback when applying for a role.

A KPMG spokesperson told Recruiter in a statement it made good business sense for the firm to listen to views and feedback about graduate recruitment, and transform its practices to show graduates of all ages the firm listens to their feedback and adapts processes.

This is especially important, the spokesperson added, due to the “fierce” competition for the very best graduates, “even more so now big businesses are competing with smaller start-ups as well as their traditional competitors”.

The spokesperson said the new process provides more certainty to candidates about what will happen and when.

“Successful candidates will receive a job offer more quickly so that they can then focus on their studies and university life without needing to attend further interviews.

“There’s also the opportunity to learn a new skill. This will help them to determine whether KPMG is the right fit for them.”

The programme is being rolled out now for 2017 graduate trainees, while the firm will be running Launch Pad recruitment events around the country from October 2016.

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Permalink 11:33:47 am, by dacare, 705 words, 280 views   English (US)
Categories: Opinion and View

Are going-out companies paying too much?

In the late 1980s, Japan had over-inflated stock and property markets. Its companies, fleeing the lack of opportunities in Japan itself, vastly overpaid for all manner of U.S. assets. I often dreamed that some Japanese investor would overpay for the house I owned at the time.

The rate of Chinese companies making overseas investments has more than doubled since last year. They often have a business model designed to bring technology and foreign business practices to the huge domestic Chinese market?a much better-defined plan than the Japanese, who were mostly purely financial investors, ever did. But, still I worry that they are paying too much.

Let's take a look at a recent deal. Beijing-based LeEco Global Ltd announced last Tuesday that it agreed to pay $2 billion cash for Vizio Inc, a California-based manufacturer of inexpensive television sets and sound bars. This at a time when the dollar is high relative to the yuan. LeEco argued that Vizio will enable it to gain market share in the coming internet-of-things technology that links all kinds of smart products together. And, it certainly may turn out in that LeEco made a smart move in the long run. But, I still wonder about the pricing.

Vizio filed initial public offering papers with the U.S. Securities and Exchange Commission in July of 2015, but never actually carried out the IPO. According to accounting data in the SEC filing, Vizio's profits were $44.96 million in 2014 and $31.35 million in the first half of 2015.

Since Vizio is privately held and decided not to go through with the IPO, subsequent data are not available. But these numbers imply a profit of roughly $56 million in 2015, assuming that Vizio makes slightly more than half of its profits in the first half, as it did in 2014. Vizio has not been a growth company?its sales and profits in 2014 were about the same as in 2010 and were lower in the years in between.

Vizio's business in the U.S. is in brutally competitive markets. Most consumers in the U.S. consider television sets to be almost undifferentiated commodities?they buy the cheapest one. Vizio has become the biggest-selling brand of TVs in the U.S. by following a low-price strategy. But, this strategy leads to very low margins?profits have averaged less than 3 percent of sales.

Vizio's TVs are connected to the internet, so the company receives potentially valuable data on what shows its customers are watching. But, the company so far has not been able to reap profits from this information. In any case, William Wang, the current CEO and majority owner of Vizio, will retain 51 percent ownership of the Insight division, which will own this data.

The bottom line is that LeEco has agreed to pay about 35 times earnings for a producer of near-commodity products in a highly competitive business. This compares with Apple Inc, which currently trades for 11 times earnings, Google Inc at 30, and Samsung Electronics Co at 3.3.

If Vizio had completed its IPO and received 10 times earnings, which seems about right for a low-margin company, it would have had a market value of $600 million. Even at the current historically high average Dow Industrials price-to-earnings ratio of about 20, which is too high for a company in such a competitive market, Vizio would be worth $1.2 billion.

China Daily reported that Jia Yueting, founder and CEO of LeEco, said that the purchase of Vizio is part of a "big bang plan" to enter the U.S. market.

It may get access to Vizio's distribution channels to sell its phones and other products?but, Vizio sells its TVs through big box stores, such as Best Buy Co Inc, which insist on paying low-margin prices to their suppliers.

It may be able to use its LeEco system to add value to the TVs, but Vizio made its name through low prices?proving that customers are reluctant to pay more for sophisticated TVs. Just about every merger or acquisition is justified on the basis of "synergies", but few actually pay off.

Companies spending their own money have more incentive to get it right than does an outside analyst like myself. But, I do hope the current wave of Chinese companies going-out are not paying too much.

(By David Blair)

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Permalink 02:59:59 pm, by dacare, 188 words, 210 views   English (US)
Categories: News of China

Uber China team to get 6 months base salary and equity vesting as bonus

After China's ride-hailing market leader Didi Chuxing confirmed Monday that it will acquire Uber's business in China, Uber China held a staff meeting in the evening, announcing that the company will pay a cash Close Bonus in recognition of Uber China team's contribution, according to a report by technology media site,

The bonus will be valued at 6 months base salary and 6 months equity vesting that includes new hire grants, performance bonus and referral bonus.

The company said half of the bonus will be paid in cash within one week after the merger closes and the remaining half will be paid to employees one month after the closes.

Only employees who have worked with Didi or Uber for at least 30 days after the signing of the deal are qualified to receive the remaining half of the bonus.

Didi's acquisition of Uber China's business will give Uber a 5.89 percent stake in Didi, and Didi will also gain a stake valued at $68 billion in Uber's global business.

Apart from Uber's chief executive officer Travis Kalanick's blog post, Uber China officials have not commented on the acquisition yet.

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Permalink 11:27:37 am, by dacare, 513 words, 295 views   English (US)
Categories: News of China, Investing in China

Low private investment, high debt weigh down growth

Beginning with the second quarter of the year, China will be in the do-or-die battle of its economic transition, according to Hong Kong-based researchers.

The country's transition will undergo its most difficult stage, although it will probably maintain around 6 percent growth in GDP in the second half of the year, according to economists and financial analysts recently surveyed by China Daily.

According to the National Bureau of Statistics, the economy saw year-on-year growth of 6.7 percent in the second quarter, slightly above market expectations. The second quarter's growth rate was the same as in the previous quarter.

The growth was powered by retail sales, industrial output and new loans directed to fixed-asset investment.

But several things are at the center of concern, said Sun Mingchun, senior partner and chief economist of China Broad Capital Co Ltd, including an excess of industrial capacity, a large total social financing and a high leverage ratio, meaning a high level of debt.

Private investment was 15.9 trillion yuan ($2.39 trillion) in the first half of 2016. Its annualized growth rate fell from 3.9 percent in the first five months to 2.8 percent in the first half of the year, which means there was quite a dip in June alone.

Private companies are not seeing encouraging returns from their investments in most industries. And they probably still will not see a good profit in the next two to three years, Sun said.

By contrast, the State sector investment rose an impressive 23.5 percent in the first half of the year, concentrating mostly on infrastructure development in the less-developed areas.

But so much investment is still not as powerful a driver of growth as consumer spending, especially that on services, said Fielding Chen, Asia economist for Bloomberg Intelligence. If investment sees a further decline in the second half of the year, which he expects, the economy's growth engine will remain weak.

According to Cui Li, managing director and director of macroeconomic research at CCB International, the economy will be in its difficult period because it is facing an "unprecedented balancing risk", including "weaker-than-ever global demand, need for a sharper-than-expected capacity cut for the industry, and a round of bond defaults that weigh on investor sentiment."

Ding Shuang, head of China research at Standard Chartered Plc, said that although the hard landing scenario is less likely to happen, the mainland economic situation will remain complex, with questions about how to deal with its mounting debt and avoid the threat of capital outflow.

Ding expects that in the coming months of the year, China's fiscal policy will keep expanding while its monetary policy will be neutral. Cutting the reserve requirement ratio for banks may be the best way to enlarge the credit supply. But before the RRR is cut, the government may use reverse repos and lower interest rates on the medium-term lending facility.

Debt is a particularly ugly spot, the researchers said. As measured by Fitch Ratings Inc's Adjusted Measure of Total Social Financing, credit to companies, local governments and households rose as much as 15 percent in 2015 in the Chinese mainland, more than double its GDP growth.

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Permalink 01:37:44 pm, by dacare, 125 words, 312 views   English (US)
Categories: News of China, Banking & Financial Services

Insurers, banks post sharp drops

Shanghai stocks ended nearly flat yesterday, with falls seen in financial and insurance firms.

The Shanghai Composite Index edged up 0.1 percent to close at 2,994.32 points.

Banks were vulnerable following investor concerns that curbs on their investment in wealth-management products might restrict capital flow.

China Everbright Bank lost 1.55 percent to 3.82 yuan (57 US cents), and China Merchants Bank shed 1.32 percent to 17.14 yuan.

China Life Insurance Co fell 1.35 percent and Ping An Insurance Group lost 1.04 percent after the China Insurance Regulatory Commission said local insurers' combined profits plunged more than 54 percent in the first half due to lower investment return despite growing premium income.

Airlines gained as oil prices declined, with China Eastern Airlines adding 1.29 percent to 7.01 yuan and China Southern Airlines jumping 1.85 percent to close at 8.54 yuan.

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Permalink 11:25:58 am, by dacare, 647 words, 303 views   English (US)
Categories: News of China

Yuan to join world’s top three currencies for payments

Key challenges persist in internationalization process, experts warn

The yuan is expected to become the third-largest payment currency after the U.S. dollar and the euro by 2018, an expert said during the 2016 International Monetary Forum in Beijing on Sunday, while noting that the currency's internationalization still faces key challenges.

"The yuan is expected to surpass the Japanese yen and the British pound to become the third-largest payment currency," said Xiang Songzuo, a vice director of the International Monetary Institute (IMI) under Renmin University of China.

The yuan's internationalization has progressed steadily in recent years, according to the 2016 Renminbi Internationalization Report, which was released by the institute during the forum.

As of the end of 2015, the Renminbi Internationalization Index (RII) stood at 3.6, a year-on-year increase of 42.9 percent and an increase of more than 10-fold over the previous five years, said the report.

The RII is used by the institute to measure the internationalization of the yuan. It takes into account the currency's status in international trade and finance and in official foreign reserves.

A currency's internationalization can range from zero to 100.

The yuan ranked sixth in terms of payments as of June 2015, Chen Yulu, a vice president of the People's Bank of China (PBC), the country's central bank, told the forum on Sunday.

Chen noted that 36 countries and regions had signed currency swap agreements with China as of June this year, with a total volume of 3.3 trillion yuan ($494.3 billion).

The factors driving the yuan's internationalization are the steady performance of China's economy, its orderly pursuit of financial reform and its enhanced financial infrastructure and support mechanisms that are in line with international standards, the report said.

China's GDP grew by 6.7 percent in the first half of 2016, after expanding 6.9 percent in 2015, according to data released by the National Bureau of Statistics on July 16.

The yuan's internationalization has moved forward in steps. For example, in October 2015, China launched the first phase of the yuan's Cross-border Interbank Payment System, which provides clearing and settlement service to domestic and foreign financial institutions for cross-border and offshore yuan businesses, according to a statement on the PBC's website at the time.

Then in November 2015, the IMF announced it would include the yuan in the basket of currencies for its Special Drawing Rights reserve unit.

That move is scheduled to take effect in October 2016.

However, the yuan's internationalization still faces big challenges amid a complex, volatile and cloudy international monetary environment, Xiang warned.

One challenge is investors' confidence in the country's economy, Tu Yonghong, a professor who specializes in international currencies at Renmin University of China, told the Global Times on the sidelines of the forum.

Since the global financial crisis in 2008, many structural obstacles have emerged in China's economy.

These include weak innovation abilities, an unbalanced economic structure, difficulties in channeling finance to small and medium-sized companies, said the report.

Xia Le, chief economist for the Asia research department of Banco Bibao Vizcaya Argentaria, told the Global Times in an interview during the Beijing event that China may have to further liberalize the yuan's exchange rate.

But he said this process should be slow, as it may lead to capital outflows if the yuan sharply depreciates.

The core task of China's monetary authorities when it comes to macro financial management is to establish comprehensive, targeted strategies to achieve financial stability, concluded the report.

China should also communicate with private companies in Western countries including the US, the UK and Europe to understand how their policies are formulated, rather than communicating only on a government-to-government level, Alistair M. Michie, secretary-general of the British East Asia Council, told the Global Times in an interview on the sidelines of the financial forum.

"With the rapid pace of China's economic upgrading and reform, the yuan's inclusion in the SDR basket and the country's 'Belt and Road' initiative, the yuan will be needed more by the market," Chen said.

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Permalink 11:29:26 am, by dacare, 476 words, 244 views   English (US)
Categories: News of China

110 of nation's firms on Fortune Global 500 list

A record 110 Chinese companies have squeezed onto the latest Fortune Global 500 list, 13 of which made their debut, including manufacturing powerhouse China Railway Rolling Stock Corp, e-commerce juggernaut, home appliance maker Midea and property developer Wanda.

Experts said that it is not surprising for more Chinese companies to be listed, because of the country's relentless efforts to upgrade manufacturing, boost innovation and drive consumption.

"We will see the continued rise of Chinese companies to capture that tremendous growth of the local economy," said Adam Xu, partner of Strategy&, which is PricewaterhouseCoopers' strategy consulting business.

As more technology and commerce companies leverage and benefit from China's tremendous market potential in e-commerce, entertainment and real estate segments, they will make the Fortune Global 500 list, Xu added.

Three of the top five companies on the list are from China. State Grid rose to second place from seventh last year, surpassing the State-owned energy giants China National Petroleum Corp and Sinopec Group.

State Grid, generating $329.6 billion in sales last year, attributed its performance to successful investment strategies and research and development input.

Among the 13 debut Fortune Global 500 companies from China, ranks at 366, with revenue reaching $28.85 billion last year.

"It is not a surprise, given how quickly China e-commerce has been growing and how advanced China is for digital and mobile commerce," Xu said. positions itself as a self-managing e-commerce giant. Alibaba acts more like a service provider to numerous online shops, which is why Alibaba's revenue is not as huge as's.

China Railway Rolling Stock Corp, which ranks 266, has grown into a leading global supplier of bullet trains and subway cars.

It is widely expected that China will become the largest e-commerce and consumption market and will nurture a new consumer-centric ecosystem, Xu said.

State-owned companies topped the Chinese companies on the list, because the ranking is based on the companies' revenue instead of their profitability, said Han Xiaoping, an independent energy analyst.

"All State-owned energy enterprises are large enough to compete from a global perspective. But they are facing huge pressure when it comes to financial performance amid falling oil prices," he said.

China Vanke debuted on the list at 356, with annual revenue of $29.33 billion, followed by real estate giants Dalian Wanda Group at 385 and Evergrande Real Estate Group at 496.

Wanda, headed by China's richest man, Wang Jianlin, said after the list was released that this was the first time the conglomerate had registered for the Fortune Global 500, even though it could have secured a place before.


Thirteen Chinese companies have appeared on the Fortune Global 500 list for the first time

102 China South Industries Group

266 CRRC

349 China State Shipbuilding

356 China Vanke


381 China Aerospace Science and Industry

385 Dalian Wanda Group

408 China Electronics Technology Group

427 New China Life Insurance

473 CK Hutchison Holdings 481 Midea Group

495 WH Group

496 Evergrande Real Estate Group

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Permalink 11:00:47 am, by dacare, 169 words, 199 views   English (US)
Categories: News of China

Chinese brands lead smartphone sales

Chinese smartphone brands, including Huawei, Oppo and Vivo, posted double-digit growth in the second quarter, compared with a 3.2 percent year-on-year rise in sales globally, a report said yesterday.

The combined sales of Chinese brands hit 139 million units, up 13.8 percent year on year. The high growth rate of Chinese brands is set to remain in the third quarter, according to market watchers.

Comparatively, sales of overseas brands grew slowly and even fell.

Huawei's sales grew 7.4 percent to 29 million units, cementing its No. 3 ranking globally. Sales of Oppo and Vivo jumped about 15 percent in the second quarter.

The global smartphone sales hit 320 million units in the second quarter, led by the top-five market leaders Samsung with a 24.5 percent share, Apple with 15.1 percent, Huawei with 9.2 percent, Oppo with 5.6 percent and LG with 5.4 percent, according to TrendForce, a Taiwan-based research company.

Sales of iPhones in May shed 1.2 percent year on year in China's mainland after they fell 26 percent in the first quarter from a year earlier, said Hong Kong-based market researcher Counterpoint Research.

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Permalink 01:48:38 pm, by dacare, 621 words, 261 views   English (US)
Categories: News of China

COFCO cuts operations after merger with Chinatex

After taking control of competitor Chinatex Corp, the giant grain and oil processor and trader China National Cereals, Oils and Foodstuffs Corp (COFCO) announced on Monday it will close six departments at its headquarters and establish professional operating platforms to manage some of its businesses.

The State-owned Assets Supervision and Administration Commission (SASAC) approved the merger of the two State-owned enterprises (SOEs) on Friday.

COFCO said the combination will help increase its market share in the edible oil processing sector to 18 percent, which will make it No.1 nationwide, according to an e-mail COFCO sent to the Global Times on Monday.

The company's cotton business will further develop and eventually hold 10 percent of the global market for the crop, COFCO noted in the e-mail.

Chinatex will become a subsidiary of COFCO, according to an announcement posted on the website of the SASAC on Friday.

Combining two former competitors is in line with China's SOE reform -guidelines, which encourage the creation of giant, highly competitive entities in various industries, Feng Liguo, an expert at the Beijing-based China Enterprise Confederation, told the Global Times on Monday.

"However, COFCO has little experience in operating the textile and cotton-spinning businesses of Chinatex, which is likely to be challenging after the merger," Feng said.

The companies have similarities, however, in grain and edible oil processing, as well as trade and logistics, and the tie-up will improve Chinatex's competitiveness as well as its probability, COFCO Chairman Zhao Boya told a meeting held Monday morning.

Further streamlining operations and transforming the company into a "pilot investment firm" are the next steps that COFCO will take in restructuring, the company noted in the e-mail.

The number of staff at its headquarters will be downsized from 610 to less than 240, according to the e-mail. However, COFCO did not specify whether those employees will be transferred to other positions or be laid off.

COFCO had planned to reduce losses by more than 50 percent in the next three years and had identified 65 subsidiaries for improvement and 91 subsidiaries for intensive management, according to a statement posted on the website of the SASAC on June 13. Also, the company would restructure 102 subsidiaries through mergers and acquisitions (M&As), the post showed.

M&As are not enough, though and companies shouldn't see them as crucial to SOE reforms. Building a modern corporate structure including an effective board of directors and an appropriate staff recruitment system has to be further emphasized, noted Liang Jun, a research fellow with the Guangdong Academy of Social Sciences.

"We are paying too much attention to downsizing the State sector now," Liang said, noting that some media reports said the motivation behind the merger is that SASAC intends to reduce the number of SOEs to less than 100.

The shrinkage of the sector has been wrongly seen as part of the SOE reforms.

COFCO noted in the e-mail that the company will assign responsibility for asset allocation, production, research and development, employee evaluations, payroll and recruitment to 18 professional operating platforms.

By 2020, the company will develop two or three platforms that generate 100 billion yuan ($14.91 billion) in annual revenue and four or five that generate 50 billion yuan, the e-mail said.

COFCO will hire more professional managers and establish an incentive-based compensation system, it said.

However, the company didn't give details about how those platforms will operate or what the hiring process will be, Liang noted.

"It's still vague in terms of how COFCO will be transformed into an investment firm or a modern company," he said.

As the next step in SOE reforms, COFCO should also separate its two major sectors. One is for edible oil and grain products traded in the market, the other is foodstuffs production and management for State reserves, Feng said.

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Permalink 11:49:43 am, by dacare, 334 words, 350 views   English (US)
Categories: News of China

Apprentice program to foster high job skills

Following a series of pilot projects, China is expected to promote a new model of apprenticeship to foster high-end skilled workers.

"Apprenticeship is an essential means to promote skill development and realize successful transitions from school to work," said Yin Weimin, minister of Human Resources and Social Security.

"The initiative is for building high-quality apprenticeships and developing a workforce that possesses strong capabilities in both theory and practice and meets the needs of the labor market," Yin said after the G20 Labor and Employment Ministerial Meeting on Wednesday.

Yin said skill development has always been a key topic of the G20 Labor and Employment Ministerial Meeting.

In August, the Ministry of Human Resources and Social Security promoted a new model of apprenticeship that combines company training with vocational schools. Every one of the total 13 provinces or municipalities chose three to five enterprises involving about 7,000 people. Everyone under the pilot project was a worker as well as a student.

Yu Zhiwei, vice-president of LinkedIn China, said the mismatch of the labor market has two aspects.

"On one hand, we have an excessively large group of medium- and low-skilled workers who cannot find proper jobs; on the other hand, we have an acute shortage of professionals, innovative talent and high-end talent."

According to The Human Capital Report 2016 released by the World Economic Forum, approximately 25,000 new workers will enter the labor market in developing countries every day until 2020, while more than 200 million people globally continue to be out of a job. Yet, simultaneously, there is expected to be a shortage of some 50 million high-skilled job applicants over the coming decade.

Li Shanxiang, deputy head of human resources at Linyi Mining Group in Shandong province, said the company has signed a contract with Shandong Coal Technician College, aiming to leverage the skill level of 100 medium-skilled workers in two years.

"We are very keen to cultivate our workers into high-skilled ones. The new apprenticeship model provides one teacher for three to five apprentices and provides special training for them."

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Permalink 02:03:57 pm, by dacare, 292 words, 206 views   English (US)
Categories: News of China

Baosteel prepares to slash capacity through 2018 in supply-side reform

Baosteel Group, China's second-biggest steelmaker, plans to cut its production capacity over the next two years as it pursues supply-side reform, it said on its website on Tuesday.

Baosteel's announcement comes as the Chinese government works to reduce capacity gluts in the steel and coal sector.

The government has earmarked 27.6 billion yuan ($4.12 billion) to pay for closures in the sectors as the country has pledged to cut up to 150 million tons of steel capacity and 500 million tons of coal output in the next three to five years.

Overcapacity in China's steel sector has also created trade tensions as India, Australia and the U.S. have imposed duties on Chinese steel exports amid allegations of dumping.

Baosteel pledged to cut 9.2 million tons of crude steel capacity between 2016 and 2018, the company said, equivalent to about one-quarter of its 2015 production.

The capacity shutdowns will include facilities in its flagship plant in Shanghai and branches outside of the city. The company will not resume production after the closures, it noted.

Baosteel's cutbacks follow a statement by the State-owned Assets Supervision and Administration Commission on Friday that China's government-run steel and coal companies will cut capacity by about 10 percent in the next two years and by 15 percent as of 2020.

The listed units of Baosteel and Wuhan Steel Group, the country's sixth-largest mill, separately said in June they would restructure, without specifying details.

Baosteel Chairman Xu Lejiang told a government meeting on July 8 that large State-owned steel companies should use mergers and acquisitions to improve the concentration level of the industry and urged the government to step up efforts to close inefficient capacity, the company said on its website on Monday.

In April, a Chinese government official said the country has 1.13 billion tons of crude steel production capacity.

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Permalink 11:49:37 am, by dacare, 208 words, 222 views   English (US)
Categories: News of China

Domestic FMCG sales post faster rise

Sales of domestic fast moving consumer goods grew 4.4 percent last year, twice as fast as global brands in China, according to a latest report yesterday.

The domestic brands, unlike their global counterparts, managed to capture more effectively trends such as consumers pursuing higher-end products, the OC&C Strategy Consultants' annual Global 50 report said.

"Increased average household incomes and a growing middle class boost consumer demand for better-quality products, which explains why many FMCG categories are going after high-end products, especially those related to health and quality of life," said Jack Chuang, partner of OC&C Strategy Consultant in China's mainland, Hong Kong and Taiwan.

"Domestic players have better relationships and expertise managing distributors and it is easier for them to tailor to local tastes and innovate faster," he added.

Two Chinese companies, WH Group and Tingyi, took the 18th and 47th spots respectively in the top 50 ranking, the report said.

Switzerland's Nestle was No. 1 by grocery sales, followed by Procter & Gamble, PepsiCo and Unilever.

The slowdown in the Chinese economy is having an impact on the whole industry, with alcoholic drinks falling 6.1 percent in 2015 in China.

Annual sales grew for 70 percent of all domestic FMCG brands, compared with 50 percent of global brands operating in China.

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Permalink 11:09:23 am, by dacare, 876 words, 225 views   English (US)
Categories: News of China

Dalian Talent emerges as leading candle supplier

A man makes scented candles shaped in the form of pine trees at Dalian Talent Gift Co Ltd's exhibition hall in Dalian.

Dalian Talent Giftis peddling its decorative candles across the globe even as it brightens the domestic market

At the exhibition hall of Dalian Talent Gift Co Ltd, visitors are treated to sights of scented candles in various forms like yellow lemons, chocolate pine nuts and reindeers carrying gifts.

Wang Lixin, chairman of Talent, said every year the firm makes billions of candles at its factories at Dalian in Northeast China's Liaoning province, Chiang Mai in northern Thailand, and Zabno in southern Poland?the world's only candle maker with a global footprint.

One of China's top three candle makers, Talent said the overseas market contributes 90 percent of its annual sales.

Now, it is establishing a global R&D center at Cannes in France, aiming to recruit top perfumers for the design, research and development of fragrant products like scented candles.

"France boasts the world's best manufacturing bases and human resources for perfumes. It is easier to find seasoned perfume makers to work with us," said Wang.

The R&D center is expected to better serve the company's mission to produce fragrant products and high-end candles to beautify homes and signify evolved lifestyles. Wang said Talent is committed to environmentally friendly and sustainable growth.

So, although Dalian is an important petrochemical base in China, and Talent is only 60 kilometers away from its paraffin supplier, the company decided to avoid dependence on fossil energy, and turned to vegetable oil.

Vegetable oils such as soybean oil and palm oil have superseded paraffin wax as the main raw material in Talent's candles. It buys only certified ISPO (Indonesia Sustainable Palm Oil) and rejects those that may cause illegal deforestation.

The renewable oil now accounts for more than 85 percent of its raw materials. "If making money is at the expense of environment, it is worthless," Wang said.

With its high-quality products and pro-green policy, Talent has established long-term and stable cooperation agreements with global retail giants such as Germany's Metro AG, Sweden's Ikea Group and America's Wal-Mart Stores Inc.

That is commendable for a company that was established as a craft workshop in 1997 at a village in Dalian. Ever since, overseas markets have been key to its success.

But the United States and the EU imposed anti-dumping sanctions on China's candle manufacturers in 2006 and 2009 respectively.

China's candle industry was hit seriously as sanctions continued for several years. More than 1,500 Chinese candle makers used to export to the EU before the sanctions. No less than 100 of them had annual export volume exceeding 1,000 tons. However, when the anti-dumping measures were lifted last September, their number had dwindled to only 10, said Wang.

Amid all this, Talent thrived. Wang believes sanctions helped Talent grow by leaps and bounds. For, it adopted a creative response to them.

"Thanks to the allocation of global resources, we not only avoided (the adverse impact of the sanctions) but upgraded our products," he said.

That's not all. It opened new plants in the ASEAN region and the EU, changing unfavorable factors into advantages.

First, the subsidiary in Chiang Mai was founded in 2007. As an ASEAN member, Thailand offers its handicraft industry convenient logistics. More importantly, it is immune from the trade barriers of European and American markets, said Wang.

Next, in the same year, Talent imported advanced automated assembly lines from Germany. The annual output soared to 25,000 tons and exports reached $60 million, ten times that of 2002.

Then, in 2009, in response to the EU's sanctions, Talent took over a candle factory in Poland, a major European candle manufacturing base.

It hired more than 200 local workers and made it one of the biggest manufacturing firms in Zabno. It is now expanding the facility.

It is not easy to set up a factory in another country due to challenges like different languages and cultural backgrounds. But buying out an existing firm worked well for Talent.

"We need not stick a label of our nationality. International vision and international attitude will help a lot to participate in local economic and social development and life," said Wang.

This year, sales volumes are expected to increase by 20 percent, said Wang. What's more, the European and American markets are stable.

According to the National Candle Association of the US, candles are used in seven out of 10 US households. Annual retail sales of candles in the US are estimated to be around $2 billion.

The domestic market is not exactly thriving. But it is growing with more Chinese people starting to use fragrant products like scented candles.

For instance, Shang Wanning, 29, has been using scented candles for several years now. When she comes home from work in the evening, she usually lights a candle and plays some light music.

"The room becomes more comfortable and cozy. It's really a good choice for relaxation and stress reduction," said Shang.

She usually buys candles from Ikea, online stores or from stores abroad.

"There's no difference. Wherever I come across beautiful candles, I bring them home," she said.

Wang of Talent said attempts to satisfy the olfactory sense are innate to human physiological needs. When people are satisfied with vision and taste, the demand for fragrance arises, he said.

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Permalink 11:46:48 am, by dacare, 197 words, 488 views   English (US)
Categories: News of China, Investing in China

Chinese office buildings draw international investors

International investors have a growing appetite for office buildings in China's key cities like Beijing and Shanghai due to bullish demand, a survey from international real estate service provider CBRE showed on Thursday.

About 35 percent of investors surveyed showed their interest in office buildings in the country's first tier cities this year, compared with 20 percent in 2015. A total of 25 percent showed their interest in the residential sector, 25 percent in the logistics sector and 12 percent in the retail sector.

"Though international investors have more competition from domestic ones, China remains one of the most popular investment destinations in the Asia-Pacific region, following Australia and Japan," said Gran Ji, executive director of capital markets for northern China at CBRE Group,

Meanwhile, with public awareness of environmental protection increasing and green building initiatives on a clear government agenda, the green building concept is increasingly gaining the spotlight in China's commercial building market.

In the 10 select cities CBRE observed, rental premiums of LEED-certified Grade A office space in most cities is in the range of 10-30 percent, compared to non LEED-certified samples. LEED-certified office projects enjoyed higher average rental performance and were in a better position in a weak downward market.

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Permalink 04:44:17 pm, by dacare, 404 words, 185 views   English (US)
Categories: News of China

Tencent opens up big data platform to boost sharing economy

Tencent Holdings Ltd has announced that it will fully open up its big data platform and machine learning technology in a move to build a "sharing economy" based on cloud services.

Enterprises will be able to use a set of big data analysis tools developed by Tencent, helping them gain a better understanding of their clients and improve their products.

The Shenzhen-based internet giant, which owns instant messaging tools QQ and WeChat, has years of experiences storing and analyzing huge amounts of data.

The opening of its core technologies is part of Tencent's efforts to develop cloud services, an area which many other big companies including Alibaba and Baidu are also tapping into.

"Development of a sharing economy is closely related to cloud services" said Ma Huateng, chairman of Tencent. "Like transportation, accommodation and many other areas, cloud services are also a kind of sharing economy."

He said cloud computing has become one of the key areas Tencent focuses on and the company is dedicated to opening its IT resources and technological capabilities to outsiders.

"In the past, enterprises were only users of internet technology. Now, as they engage themselves in the cloud, they are becoming a part of the internet ecosystem," Ma said at the 2016 Tencent Cloud Summit held in Shenzhen this week.

Cloud technology has achieved greater importance in recent years as more and more Chinese enterprises integrate themselves deeper with the internet. However, it remains difficult for companies, especially smaller ones, to build their own data center because it involves large capital investment and a waste of resources, said Dowson Tong, senior executive vice-president of Tencent.

Cloud services help enterprises get access to more resources while reducing their operating costs, Tong said.

According to the 2016 Internet Trends report, services provided by Tencent are the most commonly used by Chinese internet users. More than 50 percent of their time on the internet is spent on Tencent services.

"We are not offering cloud services as a separate business. Instead, it is a part of Tencent's entire strategy. Enterprises will be able to get access to all Tencent platforms by using its cloud services," Ma said.

Joe Weinman, a leading cloud computing strategist, said Tencent has a good background in offering cloud services. The company owns a huge amount of consumer data and knows what consumers need. This will enable it to do better in user experience and improve availability of its products, he said.

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Permalink 11:25:49 am, by dacare, 62 words, 226 views   English (US)
Categories: News of China

China service sector growth expands slightly in June

Business activity in China's service sector expanded slightly in June, a private survey showed Tuesday.

The Caixin China General Services PMI (Purchasing Managers' Index) came in at 52.7 in June, up from 51.2 in May, according to the survey conducted by financial information service provider Markit and sponsored by Caixin Media Co. Ltd.

A reading above 50 indicates expansion, while a reading below 50 represents contraction.

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Permalink 11:51:58 am, by dacare, 242 words, 280 views   English (US)
Categories: News of China, Manufacturing & Industry

China's manufacturing sector remains the 'most competitive' for now, report says

China remains the most competitive country in the manufacturing sector, but it will be replaced by the U.S. by 2020 because of shortcomings in human resources, innovation, resources policies and infrastructure, a report released on Saturday noted.

Considering its relatively low labor costs and strong infrastructure policy, China was ranked No.1 in manufacturing competitiveness, according to a global survey of more than 500 companies, Guangzhou-based newspaper 21st Century Business Herald reported during the weekend.

The survey was part of a report released jointly by Chinese think tank ChinaInfo100 and multinational professional services provider Deloitte.

The report said China has established an ecosystem to encourage innovation, partially because research and development spending has increased significantly in recent years, according to the media report.

In some areas, China has already surpassed the U.S. -- for example, the Tianhe-2, a supercomputer developed by China's National University of Defense Technology, is the world's fastest supercomputer, it said.

However, global economic growth will continue to slow in 2016, which will depress industrial output. China is lagging behind the U.S. in several aspects such as human resources, innovation and the legal environment, the report said.

By 2020, the U.S. will become the most competitive country in manufacturing, followed by China, the report predicted. Germany will remain No.3.

In China, labor costs have increased about 150 percent in the past decade, which has become a major concern for manufacturers, the report said, adding China's aging society also worries many investors.

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Permalink 04:53:23 pm, by dacare, 609 words, 287 views   English (US)
Categories: News of China

Chinese company Hisense reaps benefits from Euro 2016 sponsorship

Chinese electronics giant Hisense appears to have gotten its money's worth out of its sponsorship of the Euro 2016 soccer championship.

Hisense signed as the 10th global partner for the UEFA EURO 2016 finals on Jan. 14, joining top brands Adidas, Carlsberg, Coca-Cola, Continental, Hyundai-Kia, McDonald's, Orange, SOCAR and Turkish Airlines to complete the tournament's sponsorship program.

Hisense kept its sponsorship fee a secret, while reports said it spent 370 million yuan (about 50 million euros) for its debut in the top European soccer event, a sum amounting to about 25 percent of last year's net profit.

As the first-ever Chinese company to endorse the 56-year-old tournament, Hisense announced that its Euro 2016 exposure in China alone meant that returns exceed its investment after only the group stage.

"It has been the most successful brand marketing in the company's 47 years of history," said the company's brand director Zhu Shuqin.

Hisense said its logo appeared not only on the LED screen on site in the 36 group matches, but also on the tickets and the interview backdrops.

"Hisense's logo was caught by the cameras during the matches and seen by millions of TV viewers all over the world," Zhu said.

In China, Hisense's logo exposure through the live broadcast of China's Central Television amounts to some 300 million yuan worth of advertisement on TV, Zhu said, adding that 35 million Chinese fans followed the tournament and watched the matches on TV.

Pleased with the results of their sponsorship at Euro 2016, Zhu revealed that the company may go on to sponsor the 2018 Russia World Cup while its endorsement for other UEFA national team competitions will run until the end of 2017. The competitions include the European Qualifiers for the 2018 FIFA World Cup, UEFA Futsal Euro 2016, the 2017 UEFA European U-21 Championship and UEFA Women's Euro 2017.

European soccer's ruling body UEFA also seems happy to have Hisense on board.

Guy-Laurent Epstein, the marketing director of UEFA Events SA, told Xinhua that the sponsorship "is something between football and the Chinese brand. As we provide a great commercial platform, I am sure that this sponsorship will give Hisense a great opportunity to grow their brand in Europe and internationally."

"We look forward to working closely together with them in a mutually beneficial partnership that will also further promote the best of European football to millions of fans in China," he added.

While Hisense added the first-ever Chinese flavor to the European Championship, other Chinese enterprises are also seeing potentially enormous returns from sponsoring high profile sports events.

In December last year, Alibaba E-Auto, an "internet car" brand owned by Chinese e-commerce giant Alibaba Group, reached an eight-year presenting partnership of the Club World Cup with soccer's world governing body FIFA.

Alibaba thus became the first Chinese company to have presenting partnership with the FIFA tournament.

Months later, Chinese real estate and entertainment giant Wanda Group inked a partnership deal with FIFA which runs through the 2030 World Cup. The contract grants Wanda the highest level of sponsorship rights in the next four FIFA World Cup editions.

But Wanda's ambition did not stop at soccer. It also ventured into basketball, becoming the exclusive partner of the Federation of International Basketball (FIBA) for their worldwide sponsorship, including the sale of licensing rights and global marketing.

"It was not a mindless splurge. We are buying our way out because the key international sports industry resources, including the marketing rights and broadcast rights can only be redistributed in this way," said Wanda chairman Wang Jianlin. Last year, Wanda nailed a 20 percent stake in Madrid Atletico at 45 million euros, merged with World Triathlon Corp. (WTC) for 585 million euros, and acquired Swiss sports marketing group Infront Sports & Media for 1.05 billion euros.

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Permalink 03:34:51 pm, by dacare, 558 words, 224 views   English (US)
Categories: News of China

Suning takeover of Inter Milan to enhance growth of Chinese soccer

The advent of China's retail giant Suning Group as the majority shareholder of Inter Milan offers an opportunity for China to enhance its national soccer project, according to the management of the Italian club.

"Suning has already agreed to build its second academy in China, because now we only have one in Italy which is one of the best in Europe," Inter president Erick Thohir said. "It is interesting to build a second project in China, which hopefully can be done by March or April next year," he added.

The new academy, Thohir explained to Xinhua, will help talents from China become high-quality soccer players to be able to play in the Chinese national team and also in other parts of the world. "I really believe that China has the potential with its 1.3 billion population," he stressed.

A news conference was held in Italy's business capital Milan on Tuesday to officially unveil the Chinese shareholder to the local press.

Suning Sports, a newly established company under Suning Group, on June 6 announced the deal for 270 million euros (nearly 300 million U.S. dollars) sealing the acquisition of 68.55 percent stake of Inter Milan.

Indonesian businessman Thohir, who had previously owned the majority stake in the club, was staying on as the president with a 31.05 percent stake.

Suning, Thohir told Xinhua, will further help the financial restructuring of Inter Milan after "the debt that we had previously has being going down in the last two years, while revenues have been going up."

Thohir explained to Chinese media on the sidelines of Tuesday's news conference that a key reason why he chose a Chinese shareholder was because he was looking for a partner "with an entrepreneurial background, but who also loves soccer."

He noted that Suning has already proved to be able to build a good quality soccer, when it bought Jiangsu Sainty last December and poured in more than 100 million euros (over 110 million U.S. dollars) during the winter transfer window to create a star-studded squad in the Chinese Super League (CSL).

"Suning chairman Zhang Jindong believes in the project, and this is a new era that we can take off with the new partnership," Thohir pointed out.

The second reason why Thohir chose China was that "from 264 million fans, we have 194 million in Asia Pacific, and China is more than 100 million. It is a reality that we have to be there."

Inter Milan, Thohir went on saying, is the number one Serie A team in China in terms of fan number. Yet, "the philosophy of Inter Milan is not only business" so that "to be present in China also means be open to work with China to develop a healthy soccer environment in China," he added.

Inter Milan vice president Javier Zanetti also defined the entry of the Chinese shareholder as a great opportunity. "We have now to work all together in an aligned way to build a competitive team able to return to the highest level," he told Xinhua.

Founded in 1908, Inter Milan has won 18 domestic titles and three UEFA Champions League trophies.

Zanetti told journalists he was particularly hit by the enthusiasm of Inter Milan fans during his trips to China.

"China's football is developing and becoming increasingly important, and the relation with our club will further contribute to the growth of a sector with great potential," he highlighted.

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Permalink 02:56:51 pm, by dacare, 343 words, 210 views   English (US)
Categories: News of China

China's local consumer brands gain more market share

Workers pack dog food at a factory in Qingdao, Shandong province. The growth rate in the value of fast-moving consumer goods in China was 3.5 percent in 2015.

The growth rate in the value of fast-moving consumer goods in China reached a five-year low of 3.5 percent in 2015, according to an industry report.

The fifth annual China Shopper Report, issued by Bain & Company and Kantar Worldpanel, suggests that the rise of the service sector in China and its higher paying jobs has helped boost growth among brands in premium categories, such as yogurt and pet food. It also says that foreign brands are continuing to lose battles to local brands in this sector.

Brands in categories that traditionally cater to blue-collar workers are suffering as many manufacturing jobs move to lower-cost countries. For example, in 2015, sales of instant noodles declined by 12.5 percent and beer by 3.6 percent.

Last year, local companies' sales grew by nearly 8 percent and continue to gain share over their foreign rivals. Their biggest advance occurred in skin care, baby diapers, hair conditioners, toothpaste and shampoo.

Foreign companies generated their greatest share increase in fabric softener, infant formula, instant noodles and beer. However, foreign brands overall declined by 1.4 percent in 2015.

"Local companies have wider distribution networks particularly in lower-tier cities where growth is higher. They can make faster decisions and are more adaptable in the digital environment than their foreign peers, achieving a higher growth rate," said Jason Yu, general manager of Kantar Worldpanel China.

For example, Shanghai Jahwa uses its knowledge of Chinese herbal beauty therapy to win over consumers.

The country's retail landscape has also evolved with smaller formats continuing to gain momentum. Notably, convenience stores generated 13.2 percent growth in value last year, catering to cash-rich and time-poor urban consumers.

Online shopping continues to define the modern retail environment in China. Over the last four years, e-commerce in China has grown at an annual rate of about 37 percent and generated revenue of nearly 4 trillion yuan. The report has found that baby-related categories and skin care continue to dominate the e-commerce market.

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Permalink 10:36:43 am, by dacare, 352 words, 222 views   English (US)
Categories: News of China

Deloitte to open more offices around China

Deloitte opens more offices around China to seek greater share of lucrative market

Deloitte, a global audit and advisory firm, will continue to set up new offices and build new partnerships with companies in China's central and western regions as the country is undergoing an industrial upgrading boom, said Gary Coleman, Deloitte's global industry and senior client advisor, on Monday.

Eager to enhance its earning ability, the company set up two new offices in Changsha and Hefei in the first half of this year, after establishing offices in Wuhan, Chengdu and Chongqing over the past few years.

Coleman said China's fast growing 4G network would build a solid foundation for its manufacturers. This in turn would benefit greener, more efficient and sustainable development.

Indeed, manufacturing will be a key factor in determining competitiveness. Many countries have identified digital, intelligent and green sectors in the drive to develop high-end manufacturing.

China has been implementing a plan titled "Made in China 2025", aiming to enhance the country's manufacturing capacity under the guidance of technological progress, knowledge-based transformation and green development. This will help the Chinese economy grow at a faster speed.

"Connected industrial operations will consume less energy, since they are organized to optimize machine usage, labor, and product and service delivery," Coleman said. "Large Chinese manufacturers are already in an upgrading boom, while small and medium-sized companies also have the chance to benefit from this transformation."

He said that to achieve these goals, advanced software and internet applications in the field of big data analysis have to be established so that all parts of the value chain can communicate with each other.

Deloitte will deploy more resources in China to meet fast-growing demand for these services, focusing on the country's central and southwestern regions.

Supported by more than 13,000 employees, the financial and industrial service provider currently has 24 offices in China including Beijing, Guangzhou, Shanghai and Shenzhen.

"Such a major shift in manufacturing philosophy will affect global industry for years to come, and China will not be immune to this development," said He Jingtong, a professor specialized in modern manufacturing management at Tianjin's Nankai University.

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Permalink 02:01:23 pm, by dacare, 458 words, 249 views   English (US)
Categories: News of China, Manufacturing & Industry

Geely opts to sell interests in micro carmaker

ZD's fully-electric two-seaters roll off the production line in the Lanzhou plant in Gansu province, Jan 11, 2015.

Geely Automobile Holding has opted to sell its interests in micro-sized electric carmaker Zhidou, to enable the company to operate as an independent entity as a prerequisite to get listed in the nation's new energy vehicle catalog.

The Hongkong-listed Geely Automobile said in the news release on Friday that getting its products listed under the brand ZD is imperative for Zhidou's future, and will allow it to compete independently in the market. Under current regulations and conditions, the product can only be referred to as Geely ZD.

Geely Automobile announced a framework agreement on June 22 to sell part or all of its 45 percent interests held by two subsidiaries, Zhejiang Jirun Automobile Co and Shanghai Maple Guorun Automobile Co, in Ninghai Zhidou Electric Vehicles Co to a China-listed company. Detailed terms of the agreement have yet to be determined.

Jia Xinguang, senior analyst with the China Automobile Dealers Association, said: "The move could be a strategic adjustment made when Geely found the mini-sized electric car project might not be in line with its long-term plan. Another possibility is that Zhidou is growing stronger and seeking independence."

Zhejiang Geely Holding Group Co planned for new-energy vehicles to make up 90 percent of its sales by 2020, and about two-thirds of Geely's new-energy vehicle sales will come from plug-in hybrids and gasoline-electric hybrids by the end of the decade, with the rest coming from battery-electric vehicles.

Geely Automobile joined with Taizhou Xindayang Group Co to establish Xindayang Electric Vehicle Technology Co in January 2015 to manufacture ZD-branded electric cars in Lanzhou, capital of Gansu province in northwestern China.

Local media reports cited industrial data which indicated that the ZD brand failed to close a single deal in the first four months of this year, after registering 25,300-unit sales in 2015.

The ZD brand was expected to achieve an annual sales volume of at least 500,000 by 2020, 20 times that of ZD's 2015 sales, according to Hu Hesong, a partner in the venture capital fund GSR Ventures, one of the investors in Xindayang EV.

There are now two mini-sized two-seater models being offered by the ZD brand, the D1 and D2, with prices ranging from around 30,000 to 50,000 yuan ($4,600 -$7,700) taking national and local subsidies into consideration. The ZD car models are eligible for an NEV plate in cities where gasoline car sales and usage are restricted.

ZD brand's annual production capacity totaled 300,000 units, a figure that also accounts for the integration of Xindayang Electric Vehicle Technology Co and the earlier establishing of Shandong Xindayang, according to the company.

Xindayang EV took over Geely Automobile's Lanzhou plant after a 300 million yuan-plus upgrade in 2014, with the aim of obtaining a permit to manufacture passenger vehicles.

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Permalink 10:54:41 am, by dacare, 449 words, 263 views   English (US)
Categories: News of China

Huawei 'plans to create proprietary OS' to lower reliance on Android

Telecommunications giant Huawei Technologies Co is undertaking a confidential project to develop its own operating system (OS), domestic news portal reported on Thursday, a move expert said aims to reduce its reliance on Google's Android OS and capture overseas markets.

Technology news sites have reported rumors circulating in the industry that Google might strengthen its control of the Android system over third-party devices or restrict original equipment manufacturers' (OEMs') use of functions and supporting services within the Android system.

Android OS has been a free, open-source software for years, and Google allows OEMs to customize and adjust its functions as they wish.

If Google is changing its policy on Android, then Huawei should come up with an alternative to avoid being plunged into an embarrassing situation, the report noted.

That's a major reason for Huawei's reported pursuit of its own OS, and it also explains why South Korea-based Samsung has released a mobile OS called Tizen.

Also, Huawei is pursuing expansion in overseas markets, especially in the US and Europe, where it faces strong competitors like Apple and Samsung in the mobile industry, expert said.

"Huawei's increasing revenues give it the capital to develop a unique OS that is resembles neither Android nor [Apple's] iOS, while meeting the demand of Western consumers," Wang Yanhui, secretary-general of the Mobile China Alliance, told the Global Times on Thursday.

In line with the company's development goals, former Apple creative director, Abigail Brody was hired by Huawei in 2015 as the chief user experience designer.

Huawei didn't respond to an interview request from the Global Times as of press time.

Media reports indicate that the OS project is still in its infancy, with a team in Scandinavia that includes former Nokia engineers.

Although innovative strides made by Huawei make the project's future a bright one, Wang also warned that it will take time to develop an entirely new OS.

"Any mobile OS relies heavily on its ecosystem. Currently, almost all the mobile applications have two versions - Android and iOS. But are they willing to develop a new and unique version for Huawei?" Wang said.

"So Huawei will opt to apply the OS first on its smartwatches and bands, and then gradually to other consumer electronic products like set-top boxes and finally to its mobile," Wang noted.

In 2015, Huawei's research and development spending increased 46.1 percent year-on-year to 59.6 billion yuan ($9.2 billion), accounting for 15 percent of its sales revenue, its financial statements show.

The company also leads in terms of international corporate patent filings with a record of 3,898 filings in 2015, topping the global list for the second consecutive year, according to the Xinhua News Agency, which cited the World Intellectual Property Organization.

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Permalink 11:54:09 am, by dacare, 516 words, 264 views   English (US)
Categories: Manufacturing & Industry

Manufacturing holds key to Industry 4.0

Fuyao Group boss says firm has long aimed at smart production

Industry 4.0 can only be successful when an enterprise has a solid manufacturing capacity, said Cao Dewang, chairman of Fuyao Group, the largest automotive glass supplier in China.

"Industry 4.0 is quite a popular concept at the moment. But my concern is that manufacturers may face the risk of failure if they don't have a strong manufacturing capacity. China's manufacturing industry is still not very advanced," said Cao.

The vision of Industry 4.0 is for "cyber-physical production systems" in which smart embedded devices work together wirelessly directly or through the internet of things. It is seen as the Fourth Industrial Revolution following the first three driven by steam engine, electricity and the personal computer.

Fuyao has adopted a slogan of "Make Industry 4.0 Take Root in Fuyao". The reason that Fuyao is ready for Industry 4.0 is because it has more than 20 years of developing strong manufacturing competence under a vision on intelligent production, according to Cao.

"I first came to the realization that intelligence is the future when one of my engineers reminded me that software would one day be more valuable than human power in 1988 when I first bought equipment from overseas," said Cao. "I have been aiming at a smart production process ever since."

Founded in Fuzhou in the eastern part of China in 1987, Fuyao Group (Fuyao Glass Industry Group Co Ltd) now has a 65 percent share of the domestic market. The company has manufacturing bases in nine countries, including the United States, Russia, and Germany.

Cao was named as manufacturing pioneer in China by Forbes magazine in 2015. It was the first on the 14-member list, followed by Dong Mingzhu, chairwoman of Gree Electric Appliances Inc, Liang Wengen, chairman of Sany Group, and Zhang Ruimin, chairman of Haier Group.

Fuyao's information technology and automation system have taken the lead among its counterparts in the world, according to Forbes.

It has formulated a sophisticated data system in purchasing, logistics, services and other value-added production links.

Fuyao's average use of robots is more than 200 robots per 10,000 workers. The level is 300 in Japan and 100 in the U.S. in automotive glass manufacturers, according to Cao.

"The key to success for Industry 4.0 is to design a system that suits the enterprise' production process. If you don't know the details in production like the back of your hand, how can you design the system that works the best?" said Cao.

Other factors for the success of Industry 4.0 include large production capacity, good management, the employees' quality, and high demand for the product. The demand for high value added automotive glass that is more environment-friendly, energy saving, intelligent and integrated is rising fast.

Fuyao is moving up along the value chain by developing intelligent glass of sound proof rate of 90 percent, heat insulating, low energy consumption and auto light adjustment.

It is also developing a windshield that can function as a dash board.

Fuyao realized revenue of 13.6 billion yuan ($2.1 billion) in 2015, a 5 percent increase from the same period in 2014. Its net profit stood at 2.6 billion yuan in 2015, up 17 percent from the end of 2014.

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Permalink 11:06:46 am, by dacare, 279 words, 190 views   English (US)
Categories: News of China

Chinese e-commerce giant,Wal-Mart partner to expand business

China's second largest e-commerce platform partnered with global retail giant Wal-Mart with the latter trading its China online unit for's stakes, a strategic step expected to expand Wal-Mart's reach to more Chinese customers.

Under the deal, JD will take ownership from Wal-Mart Stores of the Yihaodian brand, website and app while giving about a 5 percent equity stake to Wal-Mart, worth about 1.5 billion U.S.dollars at JD's current valuation, the company announced Monday night.

The deal is expected to give Wal-Mart access to JD's online traffic and bolster its presence in the extraordinarily lucrative, but increasingly competitive, online marketplace.

Wal-Mart Sam Club China will open a flagship section on, and both companies will leverage their supply chains and broaden the range of imported goods to meet the growing demands from increasingly affluent and quality-oriented Chinese consumers.

In a statement issued Monday, Wal-Mart CEO Doug McMillon said JD had "complementary business and was an ideal partner."

Yihaodian has a strong presence in eastern and southern China, selling food and beverages, home goods and electronics.

JD chief executive Richard Liu expects the alliance to help improve the customer experience and boost business for Yihaodian thanks to JD's logistics capabilities and wide range of products.

JD has nearly 6,000 delivery and pickup stations in about 2,500 counties and districts across China, with a huge customer base and an outstanding same-day delivery network.

The company launched a 20-day long online shopping promotion campaign starting from June 1 to June 20, which received orders worth over 100 million yuan, about 85 percent of transactions were on mobile devices.

The NASDAQ-listed Chinese online retailer saw its shares surge nearly 8 percent before trading was halted Monday.

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Permalink 10:31:03 am, by dacare, 95 words, 170 views   English (US)
Categories: News of China

Volkswagen to produce more electric cars in China

Volkswagen China said on Monday that it expects electric vehicles to account for up to 25 percent of its total auto production by 2025.

Vehicles driven purely by electricity will sell two to three million units by 2025 as Volkswagen expands its electric vehicle line to over 30 models in the next 10 years.

Batteries for electric vehicles could emerge as a new source of income, the automaker said, adding it is evaluating the research needed and potential income.

The automaker will continue to expand its business in China, such as customized auto services either through in-house research or acquisition.

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Permalink 01:32:50 pm, by dacare, 568 words, 283 views   English (US)
Categories: News of China, Investing in China

Large shareholders selling spree spooks retail investors

A number of companies listed in Shanghai and Shenzhen have been reducing their holdings since the beginning of May, according to disclosures to the bourses concerned.

Market observers said this paring of holdings may dent small investors' confidence and hurt prices of the stocks concerned.

In the first seven trading days this month, large shareholders sold 543 million shares worth 14.02 billion yuan ($2.13 billion) in various companies, according to the China Securities Journal.

This almost matched similar selling through all of May, which saw big shareholders' sales of 435 million shares worth 14.43 billion yuan.

Each large shareholder holds more than five percent in a company's stock.

According to the Journal, 45 companies, through 52 filings, disclosed large shareholders' plans to sell 1.216 billion shares worth 29.14 billion yuan or $4.43 billion.

They will sell these shares gradually in three months to a year as per regulations. A big shareholder is required to disclose any substantial paring of its holding and complete such sales within a given timeframe.

Since the beginning of May, big shareholders in nine companies listed in Shanghai and Shenzhen disclosed that they are going to sell all their holdings. Among them, three firms will see big shareholders selling shares worth more than 1 billion yuan within 12 months.

Many of the companies that are seeing selling by large shareholders are small- to medium-cap enterprises in emerging sectors such as biochemicals and high-tech.

For instance, Shanghai Hile Bio-Pharmaceutical Co Ltd, a drugmaker, has seen heavy selling in their counters.

On May 3, the first trading day of the month, shares in Hile Bio-Pharma closed at 42.97 yuan in Shanghai. But by June 1, they fell to 16.37 yuan. They closed at 15.22 yuan on Friday, marking a 65 percent decline since May 3.

Although the meltdown is attributable to the automatic price shrinkage due to the company's 13-for-10 stock split on May 4, the large shareholders' selling is also believed to be a major factor.

A research note from Ping An Securities said quite a number of companies in emerging sectors listed recently, suggesting that large shareholders may be exiting to secure their gains.

Citing filings, analysts attributed the selloff to big shareholders' desire to stay liquid.

A research note from Chang Xin Asset Management said recent paring of holdings had a limited impact on the A-share market so far, given the small size of sales relative to the whole market. But small investors holding shares in these stocks may feel the pinch due to falls in prices.

Zhang Shaofen, 56, a Shanghai-based small investor, said it is understandable if big shareholders like institutional investors reduce their holdings to boost their liquidity. But, if individuals such as company founders or senior executives, or their family members, are behind such sales, it could mean they are cashing out or eager to get rid of the company's shares for some reason.

"Usually, individual large shareholders have close knowledge of a company's profitability, operations and financial situation. If such individuals sell shares in bulk deals, small investors may interpret the move as a sign of erosion of confidence in the company's future."

But brokerages said block deals do not necessarily mean big shareholders are giving up on the company or that they are cashing out or exiting for good.

A research note from Guangfa Securities said some block deals could well be in anticipation of possible mergers and acquisitions. M&A activity usually stands a better chance of success when the equity structure is clear and simple.

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Permalink 12:00:30 pm, by dacare, 175 words, 239 views   English (US)
Categories: News of China

Didi Chuxing nets $4.5b to fight off rivals

China's most popular ride-hailing application Didi Chuxing said yesterday that it netted $4.5 billion in fundraising in its latest financing round to help it fight both foreign and domestic rivals.

The investors included Internet giants, state-owned enterprises and private firms such as Apple, China Life and Ant Financial, together with existing investors Tencent, Alibaba, China Merchants Bank and SoftBank.

The proceeds will be used to upgrade technology, Big Data research and operations to improve rider and driver experience, as well as exploring new businesses and opportunities.

"Didi is prepared to continue this momentum of growth with advantages in technology and platform synergies," founder and Chief Executive Officer Cheng Wei said in a statement.

This marked the second financing round after Didi and Kuaidi, the two former leaders in the ride-hailing sector in China, merged to form Didi Chuxing in early 2015.

Didi Chuxing raised over US$3 billion in a previous fundraising exercise in September.

Didi said it handles an average of 14 million rides through its platform daily, serving close to 300 million users in more than 400 Chinese cities.

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Permalink 11:25:07 am, by dacare, 428 words, 226 views   English (US)
Categories: News of China, Manufacturing & Industry

Shanghai Zhenhua bets on automation

Shanghai Zhenhua Heavy Industries Co Ltd's booth at the China International Offshore Oil and Gas Exhibition in Shanghai.

ZPMC sees high-tech port terminals as the key to its long-term growth prospects

In less than 24 years, Shanghai Zhenhua Heavy Industry Co Ltd has developed into the world's largest port machinery manufacturer. Its plan for the next decade is to make automated container terminals a new growth engine of the company.

"ZPMC is now trying to focus a great amount of resources on automatic terminals, and we expect this sector to bolster our development in the coming decade," said Song Hailiang, chairman of ZPMC and vice-president of China Communications Construction Co Ltd.

According to Song, the future of terminals lies in unmanned technology. Through remote control, intelligent container terminals will have better performance and lower operational costs than traditional ones.

"ZPMC won't miss this great revolution. The development of automated terminals will be able to combine ZPMC's existing core business of steel cranes and related services with more diversified development," he said.

The Shanghai-listed company has already made its mark in the automated terminal sector as it is currently constructing the automated terminal project of Qingdao Port and the fourth phase of the Yangshan Deep-water Port in Shanghai.

In addition, the nation's first automated container terminal built by ZPMC at Xiamen Ocean Gate Container Terminal is under trial operation.

Furthermore, the company also received orders for automated terminals from Rotterdam World Gateway in the Netherlands and the Italian port of Vado Ligure, while 36 sets of port equipment went into service at the automated Long Beach Container Terminal in California in the United States in April.

"All the lifting equipment of the $1.2 billion investment LBCT automated port, including 14 quay cranes (shore bridges), 70 automated rail cranes, and five automated railway crane, will be delivered by ZPMC around 2019," said Song.

The firm's first order from Hamburg terminal CTA in 2000 for four cranes is regarded by Song as a landmark of the company.

All the achievements were made through persistent research and development. For more than two decades, ZPMC has kept allotting more than 3 percent of its revenue to its R&D department which now has expanded to more than 2,000.

ZPMC's reputation hit a peak during Premier Li Keqiang's trip to the China (Shanghai) Pilot Free Trade Zone in November 2015. The premier encouraged the group to realize breakthroughs and marketing promotion in automated port technology and grasp the opportunity of the national plan "Made in China 2025" issued to upgrade the country's industry.

In 1992, ZPMC was founded in Shanghai as a heavy-duty equipment manufacturer.

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Permalink 10:16:36 am, by dacare, 608 words, 205 views   English (US)
Categories: News of China

Baidu alters crowdfunding pay-for-performance search services

May drive small players out but help sector's development: experts

Search engine giant Baidu Inc is altering its pay-for-performance service for crowdfunding platforms to favor larger, better-financed participants with significant shareholders, a move that experts said Tuesday will benefit the industry in the long term.

"We've gotten a notice from Baidu that the company won't open new accounts for crowdfunding platforms that offer pay-for-performance services," an employee of Shanghai-based crowdfunding platform, who preferred to be anonymous , confirmed to the Global Times on Tuesday.

Pay-for-performance services allow companies to be featured more prominently in Baidu's search results.

The notice said that crowdfunding platforms will only be eligible to use pay-for-performance services in Baidu if they meet at least one of five criteria, which include membership of the Payment & Clearing Association of China, having shareholders from banks or having the support of State-owned enterprises, according to the employee.

Platforms that don't qualify were supposed to be dropped from pay-for-performance services as of Tuesday, the employee said, although the account of was still active because Baidu probably still needs time to deal with the issue.

Baidu didn't respond to the Global Times' request for comment as of press time.

The five conditions are basic requirements, and further metrics will be used to evaluate each platform's financial condition, a person close to the matter told the Global Times on Tuesday, speaking on condition of anonymity.

Baidu's requirements are unfair to small crowdfunding firms that are heavily dependent on the Internet, said the employee.

Crowdfunding is the practice in which new companies or project managers privately raise funds from a large number of investors. In many cases, using the Internet is the best or only way of doing so.

"There's some background to Baidu's action. For instance, government authorities have been calling for controlling financial risks since 2015," Chang Zongfeng, co-founder of, a Shanghai-based crowdfunding platform, told the Global Times on Tuesday. "Also, Baidu needs to improve its public image by reducing risks."

Baidu announced in May it would set aside 1 billion yuan to compensate users who were harmed by fraudulent marketing information on its website.

The government authorities requested Baidu to take several remedial measures in May after the death of a 21-year-old student Wei Zexi who used Baidu to search for the hospital to treat his cancer.

"During the short term, some crowdfunding firms that depend on the search engine to raise user flow will be affected a lot," said Chang, noting that some other search engines may follow Baidu's moves.

However, there are risks in the crowdfunding industry caused by "irregular practices," noted Chang.

For example, some firms lower the requirements for investors and some dubious products are offered on some platforms looking for investors, said Chang.

As of the end of the first quarter this year, there were at least 399 online crowdfunding firms in China, with 132 firms having been closed or transiting to other businesses, according to a report by Beijing-based financial information provider in May .

In the first quarter, online crowdfunding firms raised about 3 billion yuan in total.

"It's good for Baidu to strengthen the regulations, which will benefit the industry in the long term," noted Chang. "In particular, equity crowdfunding should have more stringent requirements for investors as it's riskier than crowdfunding ordinary projects of lower value."

Yu Wenhui, founder of, an equity crowdfunding platform based in South China's Guangdong Province, agreed with Chang.

"Strict regulation is good for the sound development of the industry," Yu told the Global Times on Tuesday.

Baidu could work with government authorities to evaluate platforms' qualifications, said Yu.

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Permalink 11:31:24 am, by dacare, 395 words, 168 views   English (US)
Categories: News of China

Tianjin boosts finance leasing to help small businesses

Technicians check a pilotless helicopter at a startup company in the Binhai New Area of Tianjin.

Finance leasing is becoming the second-largest source of capital, after bank loans, for small and medium-sized businesses in Tianjin, an industrial and logistics hub in northern China, according to the city's financial watchdog.

"The finance-leasing segment is in expansion mode, as it offers much-needed funds to various companies, especially those small and medium-sized ones," said Sun Jingyun, deputy director of the Tianjin Bureau of Financial Affairs.

Small and medium-sized enterprises often have difficulty getting bank loans, so finance leasing provides much needed liquidity because of its more flexible policies, added Sun.

Baolai Precision Machinery Industry Group in the city is a beneficiary of the booming finance-leasing business. In the past decade, the company bought manufacturing equipment through 27 finance-leasing deals worth 60 million yuan ($9.23 million).

Baolai has more than 800 high-end processing machines and 50 quality detection devices. According to company President Cui Yachen, more than 40 percent of its equipment was bought through finance leases, and the value of the company's annual output increased by 20 percent on average over the past 10 years.

Cui said it is more difficult to obtain bank loans, and their repayment periods are comparatively short, placing a big strain on the company's cash flow.

"Although the fee for finance lease is higher, repayment periods can stretch as long as three to five years, granting us more time for product sales and the repayment pressure is much lower," Cui noted.

To cut the costs for firms in finance leasing, the Tianjin municipal government is offering a subsidy to lessees.

"From 2016 to 2017, Tianjin will provide 3 billion yuan in subsidies, to cover about 70 percent of leasing fees for qualified enterprises," said Chen Yu, deputy chief of the Tianjin Bureau of Financial Affairs.

The annual interest rates for finance leasing range from 5 percent to 8 percent. The government subsidy will help cut the rate to less than 3 percent for Baolai, which is heading for a stock market listing in August.

In contrast, a local bank loan's average annual interest rate is about 5.16 percent.

Cui said Baolai plans to spend 10 million yuan buying new equipment through finance leasing this year, and another 30 million yuan to 50 million yuan next year.

Statistics from the Tianjin government show there are 773 finance leasing institutions in the city, and the overall value of leasing on asset has hit 680 billion yuan.

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Permalink 01:48:25 pm, by dacare, 141 words, 1142 views   English (US)
Categories: News of China, Banking & Financial Services

Central bank drains 220 bln yuan from market

China's central bank drained 220 billion yuan (33.85 billion U.S. dollars) from the market this week to ensure stable money supply.

This follows a drain of 290 billion yuan from the financial system last week.

The People's Bank of China (PBOC) conducted 360 billion yuan in seven-day reverse repurchase agreements (repo) this week, a process in which central banks purchase securities from banks with an agreement to resell them in the future.

With 580 billion yuan's worth of repos maturing this week, the PBOC ended up draining a net 220 billion yuan from money markets.

On Friday's interbank market, the benchmark overnight Shanghai Interbank Offered Rate (Shibor), which measures the cost at which Chinese banks lend to one another, was down by 0.1 basis points to 2 percent.

The Shibor for seven-day loans fell 0.3 basis point to 2.326 percent. The Shibor for three-month loans dropped 0.2 basis point to 2.894 percent.

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Permalink 02:39:36 pm, by dacare, 369 words, 235 views   English (US)
Categories: News of China

Lenovo sets up fund for startups

Yang Yuanqing, chairman and CEO of Lenovo.

Lenovo Group Ltd announced on Wednesday the establishment of a $500 million investment fund, seeking new growth points as the world's largest personal computer maker is wrestling with a declining global demand for PCs and a faltering smartphone business.

The fund, solely financed by Lenovo, will be used to finance startups in cloud computing, big data, artificial intelligence, robotics, Internet Plus and other emerging sectors.

Yang Yuanqing, chairman and CEO of Lenovo, said the new investment unit, Lenovo Capital and Incubator Group, will help the company find the biggest commercial opportunities in the next decade.

"We won't place a limit on the size of our investment in innovation as long as startups' products fit with Lenovo's broad strategies and really boast cutting-edge techs," Yang said.

According to Yang, Lenovo is also encouraging its employees to work on innovation projects, which can grow into independent firms, become the company's units and leverage capital from other investment firms to scale up.

He Zhiqiang, Lenovo's senior vice president in charge of the new investment unit, said the company will invest in 10 to 20 startups every year and help spin off at least 10 companies from Lenovo's internal incubation projects this year.

"We value quality over quantity, with focus on early-stage startups," He said, adding the company is also eyeing overseas investment opportunities.

Lenovo's intensified efforts to boost innovation came as the company is facing mounting pressure in the PC and smartphone businesses, two of its major revenue sources.

In the first quarter of 2016, Lenovo failed to make its way into global top five smartphone vendors for the first time, according to the research firm International Data Corp.

The company is having difficulty in reviving its appeal to consumers who are willing to buy more expensive handsets while its Chinese peers Oppo Electronics Corp and vivo Mobile Communication Technology Co Ltd leap forward.

In the same period, the global demand for PCs hit a nine-year low, despite that Lenovo maintained its leading position in terms of quarterly shipments.

Di Jin, a research manager at IDC China, said Lenovo's products are facing fierce competition, so it makes sense for the company to look beyond smartphones and PCs for new opportunities.

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Permalink 02:02:12 pm, by dacare, 227 words, 215 views   English (US)
Categories: News of China

Frasers Hospitality plans ambitious expansion in China

Frasers Hospitality, an international serviced apartments and hotel residences owner and operator, will continue to vigorously expand its portfolio in China as it remains confident in the country's rise as a global economic powerhouse.

The Singapore-headquartered company plans to open 10 more properties in China's key cities within the next couple of years, apart from its existing China network which currently stands at 14 properties.

The new launches will be located in Tianjin, Wuxi, Chengdu, Shanghai, Shenzhen, Nanchang, Dalian and Changsha, and will cover three of its brand offerings including Fraser serviced residences, Modena by Fraser serviced residences and Capri by Fraser hotel residence brand.

"With the exponential growth that we have witnessed over the last 11 years, there is no question that China is, and will continue to be an integral growth market for Frasers Hospitality," said Choe Peng Sum, chief executive officer of Frasers Hospitality. "Our growth strategy is very much parallel to that of China's plans to develop new infrastructure and master planned cities as they present tremendous growth opportunities."

The strengthening of Frasers Hospitality's portfolio in China, which is right on track to reach its goal of 30 properties with 7,000 units by 2019, is a significant contributor to the company's global expansion target of 30,000 units by 2019.

The company's portfolio worldwide, including those in the pipeline, stands at 139 properties, or 22,800 units, across more than 80 cities, according to the company.

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Permalink 12:05:30 pm, by dacare, 205 words, 356 views   English (US)
Categories: News of China

Commodities cool after Dalian exchange moves

Steel and iron ore futures in China steadied on Thursday, while other commodities fell as a key exchange stepped up measures to combat speculation behind a recent market surge.

Financial investors have charged into Chinese commodities futures this year, driving up contracts including iron ore, rebar, cotton and even eggs, leading many to warn of similarities with a boom in the country's stock markets, which reversed into a sharp crash last summer.

This week has seen a marked pullback as exchanges raised the cost of trading to avoid mirroring the outcome in stocks.

Coking coal futures were the hardest hit on Thursday, falling by the downside limit of 6 percent, after the Dalian Commodity Exchange imposed higher transaction fees for the fourth time in a week.

Dalian doubled the transaction fees on key steelmaking raw materials, coking coal and coke futures, from Thursday. It will also widen the trading limit for both contracts to 7 percent from 6 percent from Friday and increase the minimum margin to 9 percent from 8 percent

Steel rebar on the Shanghai Futures Exchange, the leader of last week's big spike, closed up 0.8 percent at 2,539 yuan ($391.8) a ton.

Cotton on the Zhengzhou Commodity Exchange fell 3.8 percent, Shanghai aluminum dropped 2.8 percent and Dalian soybeans fell 2.7 percent.

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Permalink 03:38:23 pm, by dacare, 724 words, 274 views   English (US)
Categories: News of China

Future mobility in global talent grab

Tesla Model X attracts visitors at Auto China 2106 in Beijing, which runs through May 4. Smart and electric cars are becoming more popular in China as young customers favor greater connectivity in vehicles.

Move signals company's drive to take smart and electric car market by storm

Future Mobility Corp Ltd, a Chinese startup aspiring to make electric and smart cars and which has the backing of Tencent Holdings and Foxconn Technology Group, has hired two senior managers from Tesla Motors Inc in its latest hunt for global talent, according to sources familiar with the company's moves.

Marc Duchesne, director of Tesla's supply chain manufacturing and assembly engineering, will join the Hong Kong-registered company as vice-president of manufacturing, said the sources, who asked for anonymity.

Paul Thomas, Tesla's senior vehicle engineering manager, is moving to Future Mobility as vice-president of engineering, according to the sources.

A spokesperson from Tesla China declined to comment on the matter.

The two hires from Tesla come less than 10 days after Bloomberg reported that three managers from BMW's i brand joined Future Mobility as vice-presidents of software and connectivity, design, and marketing.

In addition to the three BMW managers, Future Mobility has hired Carsten Breitfeld, the former project manager for BMW's i8 electric sports car, as its chief executive officer. Daniel Kirchert, the former president of Infiniti China, also joined Future Mobility as chief operation officer.

Duchesne managed Toyota's production in Canada for more than two decades before he joined Tesla in September 2011. Thomas worked at Aston Martin for over 16 years before June 2014.

Future Mobility, launched in February, said it plans to create "a premium brand with roots in China and a global reach". Its other parent company is China Harmony New Energy Auto Holding Ltd, a major auto dealership group. Tencent is the largest internet firm in Asia and Foxconn is a major assembler of Apple Inc products such as iPhones and iPads.

Yale Zhang, managing director of consultancy Automotive Foresight (Shanghai), said Future Mobility, which he called a "new but ambitious entrant" will continue to seek more talents from established global carmakers.

"It appears more reliable than other electric and smart car startups because it could have strong backing from three shareholders in terms of capital, internet technologies and manufacturing know-how," Zhang said.

Marc Duchesne (left) and Paul Thomas.

Future Mobility plans to assemble cars in China. It will have its research and development base in Shenzhen, Guangdong province, but will also have research and development units in Europe and Silicon Valley to concentrate on powertrain and autonomous driving. It has yet to reveal details for its product plans.

COO Kirchert said on Wednesday through WeChat that "demand and experience for individual mobility will witness profound changes globally. Connectivity, autonomous driving and environmental friendliness will redefine the future of cars. We will combine internet thinking and solid car manufacturing quality. This is our unique advantage."

Popularity is growing in China for smart and electric cars as young customers favor more connectivity in vehicles and become more environmentally conscious. The government is also boosting innovation in the auto industry and sales of new-energy cars to help alleviate pollution.

The government is subsidizing buyers of new-energy cars, including fully-electric and plug-in hybrid models.

As a result, many startups are emerging to produce smart and electric cars in collaborations with traditional carmakers.

At the beginning of this month, NextEV Inc, backed by Tencent and Hillhouse Capital, sealed a 10 billion yuan ($1.54 billion) deal with Shanghai-listed JAC Motor to produce new-energy and smart cars. The first electric model will hit the market at the end of 2017.

In February, internet company LeEco, founded by entrepreneur Jia Yueting, set up a joint venture with Aston Martin to manufacture smart electric cars. The first model, the Rapide E, will be launched in 2018 with powertrain and connectivity technologies from LeEco.

LeEco also plans to produce smart and electric cars under its own LeSEE brand. It unveiled a LeSEE concept car during the ongoing Beijing auto show.

LeEco has recruited a slew of executives from traditional car companies since last year, such as Zhang Hailiang, former vice-president of SAIC Motor, China's top auto group. Zhang joined LeEco earlier this month as the company's president and COO in China.

Last year, sales of new-energy vehicles in China more than quadrupled to 331,000 units, according to the China Association of Automobile Manufacturers.

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Permalink 11:42:11 am, by dacare, 211 words, 289 views   English (US)
Categories: News of China raises $1 bln on global bond market at lower cost

An advertisement for e-commerce retailer Inc in Shanghai.

China's second-largest e-commerce platform Inc has made its global bond market debut, securing a relatively low borrowing cost when raising $1 billion in debt.

The company secured a Baa3 rating from Moody's and BBB-from Standard & Poor's, the lowest rating in the investment-grade category. The five-year $500 million tranche was sold at 3.125 percent and the 10-year $500 million tranche at 3.875 percent.

The investment-grade ratings to a loss-making company are due to expectation that its profitability, remaining weak at the moment, would improve in the upcoming months, due to its expanding product offering through direct sales and the marketplace, rating agencies said.

S&P noted that JD's market share has climbed to 56.9 percent in terms of gross merchandise value, from 36.8 percent in 2011. The value of consumer electronics, which usually means low profitability, as a share of gross merchandise value has declined from 80 percent in 2011 to 51 percent in 2015.

However, a number of brokers argued that JD should be considered a high-yield credit because of its unprofitable status and the fact that it is more of a capital-intensive and hence inherently more volatile tech company.

The offering came following rising unease in the onshore bond market as a few default cases pushed yields high.

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Permalink 05:30:16 pm, by dacare, 376 words, 180 views   English (US)
Categories: News of China

J.D. Power projects 7% growth for China auto market in 2016

The vehicle market in China is expected to grow at about 7 percent this year and the low car penetration rate offers great potential, said Geoff Broderick, vice president and general manager of Asia-Pacific Automotive Operations at consultancy J.D. Power.

Compared with developed markets like the US, the car penetration rate is "tiny" in China, especially in lower-tier cities, so the consultancy is very "optimistic" about market growth, Broderick told the Global Times during an exclusive interview on Saturday.

The development of vehicle financing also offers potential, since only some 30 percent of Chinese consumers use financing, while in the US, "very few people buy cars for cash," he said.

Broderick noted that the strong momentum seen in the sport utility vehicle (SUV) sector will continue, as Chinese consumers generally prefer roomier cars. Low oil prices are supporting that trend.

First-quarter vehicle sales in China rose 5.98 percent year-on-year, with SUV sales surging 51.46 percent, data from the China Association of Automobile Manufacturers (CAAM) showed.

Broderick noted that as the base number gets bigger, it will be hard to maintain double-digit growth, so the consultancy views the current growth rate as "healthy."

He said that 2015 was a watershed year for the industry in China.

"Until recently, all car manufacturers could basically sell whatever they could produce [in China], but now there is much better alignment between supply and demand."

Last year, domestic brands accounted for about 41.32 percent of China's passenger car market, up 2.86 percentage points over 2014, CAAM data showed.

J.D. Power experts said these brands will continue to see strong growth, with improving quality.

"The quality of cars made by domestic auto brands is expected to be able to match that of joint venture automakers by about 2018," Wang Qinghua, research director at the Analytical Center of Excellence at J.D. Power, told the Global Times Saturday.

But Broderick noted that Chinese brands still need to build their brand images and improve customers' experience, where they still lag behind joint venture brands.

Broderick also see bright prospects for new-energy vehicles (NEV) in China.

"Chinese consumers are more open to embrace new things," thus the adoption rate for NEVs in China will be faster and domestic brands may take a leading role, Broderick said. "But the challenge is building infrastructure."

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Permalink 10:51:37 am, by dacare, 129 words, 251 views   English (US)
Categories: News of China

Lenovo to increase share in domestic market

Lenovo Group Ltd, which acquired Motorola Mobility last year, aims to increase its share of the domestic smartphone market by unifying brands and launching new phones.

Lenovo has unified independent brands including Motorola and Zuk into Lenovo Mobile, which is expected to become a new growth engine as the personal computer business faces an industry slump. It's time that Lenovo starts to return to its market leader position in the domestic smartphone market, said Chen Xudong, senior vice president of Lenovo, the world's biggest PC vendor.

Most of Lenovo's smartphone sales were overseas. Lenovo will raise investment in brand and distribution to expand into the domestic market, Chen added.

"We will release more game-changing smartphone models, including a new Motorola in June," said Yang Yuanqing, chief executive of Lenovo.

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Permalink 11:07:51 am, by dacare, 427 words, 225 views   English (US)
Categories: News of China

More outside investments flow in mid-range smartphone market

Ni Fei, co-founder and CEO of Nubia Technology Ltd, delivers keynote speech on April 19, 2016 during the brand's new product launch event held in Beijing.

More domestic smartphone makers are seeking out tycoons who are not directly connected to the industry for investments to compete in the mid-range segment.

In February last year, Alibaba Group Holding Ltd invested $500 million in Chinese smartphone vendor Meizu Technology Co Ltd, funding the expansion on retail channels and innovation.

In last December, Nubia Technology Ltd, another domestic smartphone maker originally owned by ZTE Corp, secured 1.93 billion yuan investment from Suning Investment Group, a separate investment arm of Suning Commerce Group, one of China's largest electronics retailers.

According to a report released by research company IDC, the market growth rate slowed down by 4 percent year-on-year in the first quarter, the first decline in six years. Currently, 290 brands are available in the market, while 63 present of the total shipment volume is contributed by the top five players, said China Academy of Telecommunication Research (CATR).

"The profit margins of domestic makers are weak," said CATR.

"The competition in China's smartphone market has come into the value-chain level," said Patrick Wu, senior analyst of GfK China. "Both the frequent launch of products and the integration between manufacturers, supply chains, distribution channels and telecom carriers is becoming a normal trend."

He said that applications and services based on cloud computing services have played an increasingly important role in the sector, and the collaboration based on core competences between the industrial chain's participates will be beneficial to the establishment of innovative systems.

Another trend that is about to catch on is the introduction of small-sized phones that have less than 5.2-inch screens.

By following the footstep of Apple Inc's newly launched 4.7-inch iPhone SE, two Chinese manufacturers, Meizu and Nubia, have just unveiled their 5.2-inch Pro 6 and 5-inch Z11 mini respectively within one month.

Instead of feeding the demands of phablet lovers, the companies are believed to aim at luring more travel photographers or users who remain attached to smaller display and handy experience.

According to Wu, hardware configuration is not considered as the premier factor for distinguishing different segment markets of the terminal devices. Drawing a product roadmap that aims at feeding target consumers is a must in the industry, so the key point for planning the screen size is the consumer demand.

Accompanying the upgrade of China's smartphone consumer market, handsets sold for more than 2,000 yuan ($310) will become a more valuable market. Manufacturers are keen on seeking their own value orientation so as to be competitive.

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Permalink 01:27:31 pm, by dacare, 649 words, 246 views   English (US)
Categories: News of China

Pursuit of innovative tech shifts to China

When Shen Chongfei left China 20 years ago to study for a physics doctorate in the United States, the Silicon Valley was considered the world hub of innovation and technology.

Today, the drive for innovative technologies has shifted to China, along with Shen himself. The company he founded, Magnity Electronics Co, specializes in infrared imaging systems used in areas such as cyber physical system and industrial automation as well as smart city applications.

The technology he developed uses thermal perception in image recognition, rendering it more accurate in darkness or in adverse weather conditions like fog and haze.

Magnity, founded in 2008 in Caohejing High-Tech Park in Shanghai, began with 15 million yuan ($2.3 million) in financing and four technology experts.

Within six years, the company broke even and attracted an additional 35 million yuan investment. The investors included venture capital companies eager to finance promising startups.

Success stories like Shen's are the pride of a nation striving to make its mark on evolutionary trends of the 21st century. They also highlight how many Chinese entrepreneurs who went to the US seeking their fortunes are now finding their best chance of success back home.

According to a US report released in late 2014, the US proportion of global research and development fell from 37 percent to 30 percent in the two years to 2012. China's percentage, meanwhile, jumped from just 2.2 percent in 2000 to 14.5 percent in 2011.

Money, of course, follows talent. The report showed that 31 percent of Chinese undergraduates held degrees in engineering, while in the US, the figure was only 5 percent.

"Graduates majoring in software development and material sciences hired from Shanghai Jiao Tong and Zhejiang University are quite professional in application and innovation," Shen told Shanghai Daily. In the Silicon Valley, it was hard to find the right partners for a niche field because researchers were focusing on their own independent innovation.

Shen's team, which now numbers 30, has developed thermal imaging cameras for industrial and commercial use, unlike in the past when they were used only by the military. His independent research has drastically reduced the cost of such devices. Previously night vision devices for the US military may cost more than US$100,000, but Shen's products for industrial applications in China cost below US$776.

Beginning this year, Shen's company has managed to undercut the prices of competitors such as FLIR Systems, the world's largest thermal imaging camera producer.

The Chinese government is placing great emphasis on creativity at home. This month, 14 model districts of startup incubators have been approved across China.

Magnity owns seven patents for thermal imaging and packaging technologies. It has been invited to participate in the China (Shanghai) International Technology Fair this week as an example of how smaller, innovative companies can develop their potential and find success.

The theme of the fair, to be held from Thursday to Saturday, is "Innovation boosts technology development." The fair adopted the theme from remarks made by Premier Li Keqiang at an executive meeting of the State Council in March, when he urged governmental bodies to do more to nurture innovative startup companies.

"I was right to come back to China," Shen said of the current environment. There are incentives to support innovation here.

"In the Silicon Valley, intense competition squeezes profits and research time. China eases both. We have been able to position ourselves to compete on an equal footing with global competitors."

Lin Zhuo would agree with that. He works for a company called Alien Technology, a world innovator in radio frequency identification.

Cyber Physical System helped Wal-Mart, an Alien customer, to save over US$8 billion annually with a rapid-speed scanner that can read hundreds of items with track tags in under one second.

In December 2014, Chinese technology service provider Rui Zhang Technology Co merged with Alien in a 30 million yuan deal. It helped Alien anchor in the Chinese market through its ties with over 1,500 institutional customers and more than 300 brokers working in system integration.

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Permalink 01:29:46 pm, by dacare, 635 words, 353 views   English (US)
Categories: News of China

Grade-A office and retail rents are rising

The new supply of Grade-A office space in Shanghai decreased 67.8 percent year on year in the first quarter of this year.

While Grade-A office rents in Shanghai increased 2.3 percent quarter on quarter, retail rents rose 0.7 percent to 55.7 yuan ($8.59) per square meter per day in the first quarter of this year, according to a latest report by independent global property consultancy Knight Frank.

In the first quarter, only about 100,000 square meters of new Grade-A offices were launched in Shanghai.

The new supply of Grade-A office space decreased 67.8 percent in the first quarter year on year. Only two office buildings were completed, including UOB Building in the "Little Lujiazui" area, providing 30,000sqm of office space, and Technology Innovation Tower Phase II in Caohejing, which added approximately 70,000sqm of offices to the market. Several office buildings are scheduled to be completed in secondary and emerging business districts in the second quarter, providing approximately 400,000sqm of new supply.

During January-March period, Grade-A office rents rose 2.3 percent quarter on quarter to 9.6 yuan per sqm per day.

With the increasing asking rents and vigorous demand from local financial institutions and consultancy industries, the market saw upward movements in rental values. By the end of 2015, there were about 1,000 domestic financial institutions based in Shanghai, accounting for 70 percent of financial firms in the city. The Little Lujiazui area is preferred by these financial institutions, which became major tenants in the area. Law firms and consultancy enterprises preferred office buildings along Nanjing Road W. and Huaihai Road M.

The average Grade-A office vacancy rate dropped 0.6 percentage point quarter on quarter to 4.2 percent in the first three months. The vacancy rate remained low due to vigorous rental demand in the emerging business districts. In the first quarter, net absorptions in emerging business districts doubled to 150,000sqm compared with the previous quarter.

Relocation activities among multinational corporations are expected to drive up the vacancy rate in core CBD areas in the short term.

The Grade-A office market in core CBDs is expected to face challenges brought about by the increasing vacant space left by relocated companies. Vacant offices in good locations with lower rents were absorbed more easily. For example, a law firm rented two floors in The Centre in the first quarter previously occupied by WPP. Premium Grade-A office vacancies with high rents in core CBD waited longer to be absorbed amid an uncertain economic climate. Architecture consultant AECOM was scheduled to relocate from Wheelock Square on Nanjing Road W. to Hopson International Center in Wujiaochang in the second quarter, due to global economic uncertainties and the slowed local real estate industry. Merck Sharp and Dohme China also relocated from Park Place to Caohejing Business Park.

Co-working pattern continued to emerge, with WeWork from the US entering Shanghai.

With the increasing support to small and start-up businesses from the local government, co-working patterns from abroad have become increasingly popular in China, with its low rents and flexible lease terms attracting start-up companies. A buoyant local co-working market has attracted many mature international brands to enter the Chinese market. WeWork, the first co-working operator in the US, made its debut in China in Jing'an District, renting two floors covering 3,000sqm in WE Creative Park. In the coming years, WeWork plans to set up two more offices in Shanghai to meet the increasing leasing demand from start-ups. Meanwhile, 36Kr, another well-known local co-working operator, also rented 1,000sqm of office space in Yangpu District.

Rental growth in core CBD is set to slow down in the second half of this year.

The Shanghai office market will see more than 2 million sqm of new supply in 2016. Rentals are expected to face pressure due to huge supply. Moreover, many MNCs are scheduled to relocate away from core CBD this year, which will drive up the vacancy rates in core CBD.

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Permalink 12:06:19 pm, by dacare, 251 words, 267 views   English (US)
Categories: News of China

Property investors still keen for Shanghai

Investment appetite for office assets remained strong in Shanghai in the first quarter of this year while retail and logistics properties would also draw growing attention from investors, major international real estate services providers said.

Four key real estate deals valued at a combined 4.3 billion yuan ($662 million) were concluded during the three-month period, with decentralized office accounting for 55 percent of total sales consideration, global property advisor Savills said in its latest quarterly report. Serviced apartments took the remainder.

"Domestic investors played an active role at the beginning of this year, concluding three deals that took up more than 80 percent of the total value," said Chester Zhang, associate director at Savills China Research. "Looking forward, retail and logistics segments are expected to see more portfolio and platform deals, as international investors want strategic interest in these sectors."

Leading international property consultancy JLL also saw continuously robust demand for Shanghai office assets.

"Domestic capital, benefitting from looser regulation and greater access to financing instruments, is seeking stabilized office assets not only in the CBD area but in decentralized and business park locations as well, with a focus on high-quality properties with stable rents," said Johnny Shao, head of capital markets for JLL Shanghai and East China. "Moreover, in the retail sector, both foreign and domestic institutional investors are expected to show greater interest for portfolio deals than single asset transactions while interest in logistics sector will continue to be seen with entity-level deals remaining the sector's major investment activity rather than en-bloc transactions."

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Permalink 01:54:58 pm, by dacare, 138 words, 334 views   English (US)
Categories: News of China, Comp, Salary & Benefit

Shanghai white-collar best paid

Shanghai overtook Beijing to be the best paid city for white-collar workers in the first quarter of this year, recruitment portal said yesterday.

White-collar workers in Shanghai were the best paid on the Chinese mainland with a monthly average salary of 8,825 yuan ($1,362), followed by Beijing at 8,717 yuan.

Shenzhen was third at 8,141 yuan, said in a report based on job positions posted on the website.

The best paid jobs in Shanghai were in professional services such as treasury, legal and human resources drawing an average monthly salary of 13,449 yuan, ahead of 13,049 yuan paid for positions in the energy sector.

Joint ventures and listed companies were the most generous employers, while private companies and government-backed organizations paid the lowest salaries, the report said.

But state-owned companies remained the most popular among job seekers who preferred stability.

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Permalink 11:39:26 am, by dacare, 145 words, 522 views   English (US)
Categories: News of China, Manufacturing & Industry

China's manufacturing activity rebounds

China's manufacturing activity rebounded to the highest level since last August in March, thanks to the government's continued structural reforms, official data showed on Friday.

The purchasing managers' index (PMI) came in at 50.2 in March, up from February's 49, according to the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing.

A reading above 50 indicates expansion, while a reading below 50 reflects contraction.

NBS statistician Zhao Qinghe attributed the rebound to the government's pro-growth measures, as well as the rising demand of manufacturing imports and exports.

The price rebound of major international commodities spurred purchases. Technology upgrades also contributed to improvement of manufacturing sectors, said Zhao.

The sub-index measuring production stood at 52.3, up 2.1 points from a month earlier, with that for new orders settling at 51.4, up 2.8 points.

The sub-index for imports came in at 50.1, up 4.3 points from February, the highest reading since December, 2013.

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Permalink 11:06:11 am, by dacare, 254 words, 238 views   English (US)
Categories: News of China

300,000 clothing merchants relocated from Beijing to Hebei

(ECNS) -- About 300,000 clothing merchants whose factories are based in Zhejiang Province have relocated their business from Beijing to neighboring Hebei Province, part of a broader plan for the integration of Beijing, Hebei and Tianjin Municipality, Beijing Youth Daily reported.

The garment association under the Zhejiang Chamber of Commerce in Beijing said some 500,000 people are expected to move to Hebei as their companies relocate.

The relocation plan aims to promote the coordinated development of Beijing, Tianjin and Hebei, to create new growth sectors and address challenging issues including population control and environmental protection.

Among the companies, more than 70 have set up new headquarters in Yongqing County of Hebei's Langfang City.

The capital city is home to around 800,000 businessmen from the coastal Zhejiang Province, a region historically known for its entrepreneurship, and 300,000 of them work in the garment industry, said Lu Jiansheng, executive vice-chairman of the Zhejiang Chamber of Commerce in Beijing.

These people mainly arrived in Beijing in the 1980s and 1990s, but the businesses face growing costs related to human resources and land, so the relocation will provide a new opportunity, added Lu.

Lunzhuo Clothing Co. Ltd. was based in Beijing's Daxing District and mainly sold clothes wholesale at the capital's most well-known clothing market Dahongmen since 1997.

Zheng Chunfa, a native of Zhejiang province and also president of Lunzhuo, said his company faced difficult conditions in Beijing, including a 27-square-meter dorm crowded with eight employees.

Now the company has moved to Langfang, where it has its own buildings and better conditions for employees.

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Permalink 11:30:25 am, by dacare, 404 words, 211 views   English (US)
Categories: News of China

Le Sports completes 2nd round of funding, valued at 21.5b yuan

A Le Sports stand at a golf merchandise expo in Beijing.

Latest cash injection of $1.23 billion puts company on way to building sports 'ecosystem'

Internet-based company Le Sports has completed a second round of financing, worth 8 billion yuan ($1.23 billion), which analysts said gives it a significant edge over rivals.

Jia Yueting, CEO and chairman of parent company LeEco Holdings Ltd, said on Sunday its sporting offshoot is now valued at 21.5 billion yuan.

The latest cash injection means Le Sports' investors include HNA Capital Group Co, the investment unit of Chinese airline giant HNA Group Co Ltd, and a number of individual investors such as Sun Honglei, a famous actor in China.

Jia said the latest round was "recognition of our broad plan to build an ecosystem, which spans sports, video streaming, electric vehicles and smartphones", adding the company continues to integrate resources from various industries.

No details were given on how the latest investment might affect LeEco's majority ownership of Le Sports, but the firm added in a statement the new cash will be used to enrich its sports-related online content, and develop new smart equipment to meet people's growing desire to stay fit.

Le Sports, which became an independent unit from LeEco's video-streaming service two years ago, is one of the fastest-growing companies in China's sports sector.

In May, it raised 800 million yuan from investors including Wanda Investment Co.

Its second funding round comes as Chinese Internet heavyweights are rushing to branch into the sports sector, an industry that is winning favorable policies from the central government.

Alibaba Group Holding Ltd and Tencent Holdings Ltd, for instance, are both expanding their presence through investment and partnerships.

Jiang Qian, an analyst at Beijing-based Internet consultancy Analysys International, said the deal demonstrated investor confidence in Le Sports.

"Le Sports has won exclusive online broadcasting rights to a series of top-tier competitions in recent years, which is a strong proof of the company's marketing and organizing capabilities," Jiang said.

In February, Le Sports spent 2.7 billion yuan on becoming the exclusive online broadcasting partner of Chinese Super League, the country's top soccer event, after winning the broadcasting rights of the English Premier League and the National Football League in the United States.

"Its abundant sports content is the biggest advantage of Le Sports, from which the company can build a sizable user base and offer other services such as selling sports game tickets and lotteries," Jiang said.

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Permalink 10:51:22 am, by dacare, 250 words, 201 views   English (US)
Categories: News of China

China's industrial profits return to growth

Workers are occupied on a production line at a factory in Xinzhuang industry zone in Shanghai, east China, July 30, 2015. China's economy grew by 6.9 percent in 2015.

Profits of China's major industrial firms rose 4.8 percent year on year in the first two months of 2016, reversing the downward trend of last year, official data showed Sunday.

Profits at industrial companies with annual revenues of more than 20 million yuan (about 3.1 million U.S. dollars) totaled 780.7 billion yuan in the Jan.-Feb. period, the National Bureau of Statistics (NBS) said.

The profits registered a 4.7 percent year-on-year fall in December and a 2.3 percent annual decrease in 2015.

He Ping, an official with the NBS Department of Industry, attributed the latest profit growth to increased sales and a milder decline in factory product prices.

In the first two months, revenues from the firms' primary business climbed 1 percent year on year, improving from a 0.6 percent drop in December 2015 and a 0.8 percent increase for last year.

In the Jan.-Feb. period, China's producer price index, which measures prices of goods at factory gate, slipped 5.1 percent year on year, narrowing from a drop of 5.9 percent in December and 5.2 percent for 2015.

Despite the recovery, part of the industrial profit growth was a result of the lower base in the same period of last year, He noted.

Industrial profits dipped 4.2 percent year on year in the Jan.-Feb. period of 2015, NBS data showed.

Compared with the same period of 2014, the Jan.-Feb. industrial profits of this year only inched up 0.4 percent, said He.

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Permalink 11:02:47 am, by dacare, 400 words, 265 views   English (US)
Categories: News of China

Chongqing, Zhoushan favorites as new free trade zones

Chongqing, and the coastal city of Zhoushan, in Zhejiang province, are being tipped by shipping experts as hot favorites to be chosen as new free trade zones for the third round selection, as the central government devotes more resources to developing the Yangtze River Economic Belt within its 13th Five-Year Plan (2016-20).

Eager to enhance the earning ability of inland regions, China has been keen to support the growth of city clusters in the Yangtze River Economic Belt, which comprises the Yangtze River Delta, the middle reaches of the Yangtze and Chengdu-Chongqing region, as well as encouraging more foreign companies to invest in central and western regions.

The central government is also likely to give priority to restoring the Yangtze valley's ecological conditions, while pressing ahead with efforts to develop an integrated transportation and modern industrial corridor within the country.

China's existing four FTZs offer a range of incentives, including more favorable interest rates, reduced tariffs on goods and trade, the use foreign currencies for payment, liberalized financing agreements, and other offshore financial services.

But with all of those in coastal regions, Dong Liwan, a shipping industry professor at Shanghai Maritime University, said Chongqing especially is seen as a strong likely new FTZ location.

"Selecting Chongqing as a new free trade zone would result in upgraded development of the Yangtze River Economic Belt, where growing shipping activities offer a diversified business platform for 11 provinces and municipalities including Jiangsu, Anhui, Hunan and Hubei," said Dong.

Already officials have expressed an interest in accelerating the developing pace of Wuhan, the inland capital city of Hubei province, Chongqing and Nanjing as regional shipping and logistics centers, which can act as river-ocean and water-railway combined-transportation hubs.

Zhoushan, however, has become a favorite given its existing transshipment cargo and logistics facilities, and strong transport links with the rest of the country, both by water and rail.

The city has rare deep-water port facilities, and is located strategically, close to the T-shape intersection of the Yangtze River and the coastline.

The integration of Zhoushan Port and nearly Ningbo Port was started in 2006, and their throughput has been counted together since.

They officially merged into one in September 2015, and recorded container throughput of 20 million twenty-foot-equivalent units for the first time last year.

Chen Yingming, executive vice-president of the Shanghai-based China Ports and Harbors Association, said Zhoushan already has plans to focus on FTZ-related shipping and finance services.

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Permalink 11:04:11 am, by dacare, 122 words, 179 views   English (US)
Categories: News of China

China's largest land port to expand capacity

Manzhouli, China's largest land port, is expected to see its annual highway cargo handling capacity climb to 10 million tonnes within the year from the current 3 million tonnes.

The improvement will be the result of the first-stage of a project aimed at upgrading road services of the port, which borders Russia to the north and also sits close to Mongolia, according to the government of Manzhouli City, north China's Inner Mongolia Autonomous Region.

The first-phase construction will be finished by the end of October. With an estimated investment of 1.03 billion yuan (about 159 million U.S. dollars), the construction of the overall project started in 2015 and is scheduled to end in 2017.

More than 65 percent of overland trade between China and Russia passes through Manzhouli.

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Permalink 11:17:27 am, by dacare, 155 words, 182 views   English (US)
Categories: News of China

Taiwan jobless rate at 16-month high in February

Unemployment in Taiwan stood at 3.95 percent last month, a new high since October 2014 mainly due to holiday factors.

The jobless rate in February was up from 3.87 percent for January and 3.69 percent in February 2015, said a press release from Taiwan's statistics agency on Tuesday.

The number of unemployed people rose slightly to 462,000, compared with a total of 11.23 million employed. Many people change jobs after the Lunar New Year, which falls on Feb. 8 this year, while some temporary jobs came to an end during the same period, the agency said.

The unemployment rate among the young (aged between 15 and 24) was 11.89 percent, compared with 4.16 percent for the 25-44 age range, and 2.2 percent for those aged between 45 and 64.

The agency also said the monthly average salary of employees in industrial and service sectors rose about 45 percent year on year in January to around 75,321 new Taiwan dollars (about 2,320 U.S. dollars), as many companies handed out year-end bonuses in January.

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Permalink 11:28:47 am, by dacare, 954 words, 211 views   English (US)
Categories: News of China

Athletic apparel makers cash in as domestic consumers become more active

After four years' losses, Chinese leading sportswear Li Ning Co reported on Thursday that it had returned to profitability in 2015. A few weeks earlier, one of its competitors, the German sportswear manufacturer adidas AG, announced its financial results for its business in China in 2015. As sports become a larger part of people's lives in China, both foreign and domestic sportswear manufacturers have been making out. However, they have different strategies to gain market share. Foreign companies such as adidas plan to further expand their presence across the country, especially in lower-tier cities, while domestic companies need to further strengthen their research and development capabilities.

Even though he had just bought a pair of Li Ning athletic shoes, a civil servant surnamed Peng recently decided to pick up a new pair of Nikes for his semiweekly badminton matches in Yichang, Central China's Hubei Province.

"Nike has a better design. When I play badminton, I feel more comfortable wearing their lightweight running shoes," the 48-year-old told the Global Times on Wednesday.

Peng has seen sports become a bigger part of people's lives in Yichang. In his badminton club, a dozen players meet every Tuesday and Thursday to bat the shuttlecock around.

As more Chinese take up sports in their spare time, both domestic and foreign brands of athletic apparel have been gaining momentum in recent years, said Lin Jing, a senior manager at China Investment Consulting Co.

Leading domestic sports brand Li Ning Co announced on Thursday that the company returned to profitability in 2015 for their first time since 2011, according to its annual report.

The company's revenue grew about 17 percent to 7.09 billion yuan ($1.10 billion) in 2015, when it reported 14 million yuan in profit attributable to equity shareholders.

Other sportswear makers including Germany's adidas AG and its Chinese competitor Anta Sports Products Ltd also reported rising revenues and profits in 2015.

Adidas's sales rose 18 percent on a currency-neutral basis on the Chinese mainland, Taiwan, Hong Kong and Macao, according to the financial report Adidas released on March 3.

Adidas said it is confident that its new "Creating the New 2020 Greater China" strategy will allow it to "outpace the competition" and remain the best sportswear brand in the market, Colin Currie, managing director with adidas Group Greater China, said at a press conference on March 4 in Shanghai.

"Adidas and its major rival Nike Inc each reported double-digit growth in China, with both sportswear makers accounting for about 12 percent of the market in China as of September 2015," Lin said on Thursday. "Competition between the brands is likely to further heat up in 2016."

The stakes are rising as more people in China take up regular sports and exercise. That number is projected to hit 500 million people by 2025, creating a market worth an estimated 5 trillion yuan, Lin noted.

Targeting lower tiers

Liao Xuchun is a loyal buyer of Anta basketball shoes, as well as those produced by another Chinese sportswear maker Peak Sport.

"Patriotism aside, the domestic companies make basketball shoes that are less expensive than those produced by Nike and adidas, even though the latter two have the endorsements of NBA stars," said Liao, who lives in Jianshi county in the Enshi Tujia and Miao Autonomous Prefecture in Hubei Province.

Liao said it is also easier to find domestic sportswear brands in his neighborhood, especially after some of the foreign sportswear stores closed in recent years.

"If I want to buy Nike or adidas shoes, I have to go to the downtown shopping malls," he told the Global Times on Wednesday.

Some foreign brands, such as adidas, believe that small and mid-sized cities will remain an important part in their corporate strategies.

Under adidas's 2020 strategy, "60 percent of our growth will come from lower-tier cities," Currie told the Global Times on March 4.

The company says more people in China's lower-tier cities will enter the middle class as their cities urbanize, Currie said. And as their incomes grow, they will be more willing to trade up to buy the adidas brand.

When contacted by the Global Times on Friday, Nike, adidas's biggest competitor in China, refused to comment about foreign sportswear companies' marketing plans for China's lower-tier cities.

On Tuesday, Nike is scheduled to release its financial results for its most recent fiscal quarter.

Although Nike and adidas have immense international profiles, Chinese companies have taken sizable portions of the domestic sportswear market.

According to a survey by FT Confidential Research, Anta was China's third most popular sportswear maker and scored particularly well among lower-income households, the Financial Times reported in February. The Fujian-based company caters to an estimated 520 million people living in China's smaller cities.

Different segments

Considering the prices of their products, foreign sportswear brands such as Nike and adidas will continue to target middle and high-end customers in larger cities, said Zhang Qing, CEO of Beijing Key-Solution Sports Consulting Co.

It is "unlikely" that they will lower their prices when they enter lower-tier cities, Zhang noted.

"One possible solution is that they could further strengthen their positions in promoting athletic lifestyles, especially in lower-tier cities," Zhang told the Global Times on Wednesday.

Also, big foreign sports brands need to work more closely with their franchise owners to come up with more specialized strategies for China's second- or third-tier cities, Zhang said.

Adidas plans to have about 12,000 stores in China by 2020, Currie said. The company will take into account the preferences of customers in small and medium-sized cities.

When competing for a larger market share in China, domestic brands, which started from lower-tier cities, should focus more on branding, which is not the same thing as signing partnerships with star athletes, Lin noted.

"They should invest more in R&D (research and development) to become a more innovative sportswear manufacturer," Lin said.

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Permalink 10:52:59 am, by dacare, 589 words, 177 views   English (US)
Categories: News of China

ZTE in talks with U.S. govt over trade curbs

Beijing calls on Washington to handle the issue 'with discretion' to avoid harming growth of ties

ZTE Corp is in talks with the United States government over the telecom equipment manufacturer's alleged violations of a U.S. trade restriction.

Opinions are split on whether the negotiations could help resolve the dispute, which, if it remains unresolved, could have a negative impact throughout China's IT industry.

Minister of Commerce Gao Hucheng on Tuesday said China is "greatly dissatisfied" with the U.S. decision to ban the Shenzhen, Guangdong-based company from buying parts from U.S. suppliers.

"I hope the U.S. could handle the issue with discretion to avoid harming the stable, healthy development of Sino-U.S. trade ties," said Gao. He added ZTE has sent a delegation to Washington to discuss the issue with the U.S. authorities.

The U.S. Commerce Department confirmed to The Wall Street Journal that negotiations are under way.

"These discussions have been constructive, and we will continue to seek a resolution," said the U.S. newspaper, citing an unnamed senior official at the department. ZTE did not elaborate on the details of the talks, saying no final decision has been made.

The U.S. Commerce Department last week banned ZTE's suppliers in the U.S. from selling components to the Chinese company amid claims that ZTE exported prohibited products to Iran.

The U.S. suppliers, including mobile chip giant Qualcomm Inc, will need to apply for permits from the U.S. government before selling products to ZTE.

ZTE said in a statement its operations were in compliance with the laws and regulations in every local market. The company pledged to cooperate with the investigation.

Hu Lu, an analyst at Changjiang Securities Co Ltd, said the punishment was related to a multi-million-dollar hardware and software export deal ZTE signed with Telecommunication Company of Iran in 2012. The U.S. forbids a long list of U.S.-made IT products from being sold to Iran.

"It was not the first time for the U.S. to investigate Chinese IT companies. Due to strong government interference, ZTE and Huawei Technologies Co Ltd are finding it difficult to penetrate the U.S. market," Hu said. "But considering that talks are taking place, and the obvious negative influence on the trade relationship with China, the U.S. government is likely to ease the punishment."

The export ban on the second-largest Chinese telecom equipment maker quickly unfolded into a diplomatic issue, with Foreign Minister Wang Yi saying the punishment "only hurts others and does not benefit oneself". U.S. component makers rely heavily on Chinese enterprises such as ZTE, Huawei and Lenovo Group Ltd for sales.

But Nicole Peng, research director at research firm Canalys China, said the U.S. may not back off on the case.

"The U.S. Commerce Department will not easily lift the ban on ZTE in order to set an example for other companies," she said. "The uncertainty of the outcome is the factor that will do the most damage to ZTE's business."

Zhu Jinsong, an analyst at Shanghai-based Haitong Securities Co Ltd, said the export restrictions on ZTE will deeply affect the Chinese IT industry.

"The matter is out of ZTE's control. The restriction reflects a battle between the Chinese and U.S. high-tech industries. Although U.S. suppliers could ask for permission to sell products to ZTE, the U.S. authorities will definitely deny such a request," according to Zhu.

Traded in Shenzhen and Hong Kong, ZTE stocks remained suspended as of Wednesday.

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Permalink 02:07:31 pm, by dacare, 140 words, 236 views   English (US)
Categories: News of China

Ctrip made 10.9 billion yuan net revenue in 2015

The net revenues of International Ltd grew to 10.9 billion yuan ($1.7 billion) in 2015, with a 48 percent year-on-year rise, the largest online travel agency in China announced on Wednesday.

It is the only Chinese online travel agency that earned continuous revenue growth during the past years.

Ctrip's net income attributable to its shareholders was 2.5 billion yuan in 2015.

Ctrip's investment last year of 1.2 billion yuan in India's largest online travel agency, MakeMyTrip, as well as a significant minority share purchase of Qunar, another of China's largest online travel agencies, positions the company well for future earnings.

Strong fiscal growth that surpassed analysts' estimates, smart investments and a continually growing middle-class in China with increasing disposable income indicate positive future financial prospects for Ctrip.

Analyst projections for 2016 expect a full year revenue growth of 65 percent, even higher than the growth seen in 2015.

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Permalink 10:54:08 am, by dacare, 229 words, 276 views   English (US)
Categories: News of China, Investing in China

Ping An profit up 38% on life insurance, investment returns

Ping An Insurance Group yesterday reported a nearly 40 percent jump in net profit last year on stellar life insurance sales and investment returns.

Ping An, Asia's second-largest insurance company by market value, said its net profit rose 38 percent to 54.2 billion yuan ($8.3 billion) in 2015, the highest since 2003.

Strong life insurance sales and a surge of investment returns partly from the bullish Chinese stock market in the first half of last year helped drive up the profits.

The company reported that premiums for life insurance rose 20 percent to 299.8 billion yuan, and the gross investment returns jumped 80.1 percent to 114.75 billion yuan last year.

Timothy Chan, the group's chief investment officer, told reporters yesterday that he expected more uncertainties this year and would seek more investment opportunities in blue-chip stocks, preferred stocks and fixed assets, especially logistic infrastructure in first and second-tier cities.

Guotai Junan Securities said in a note that Ping An's investment returns this year is likely to fall but its core insurance business remains in good shape.

The life insurance sector has benefited from greater focus on offering protection type of policies than capital-consuming investment-related ones.

The property and casualty sector has also outperformed industrial average in managing costs, the note said.

Analysts also said the group's more than 10 Internet financing branches spanning wealth management, e-commerce, health care consulting, and home sales will bring more revenue as well as clients.

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Permalink 09:54:20 am, by dacare, 281 words, 340 views   English (US)
Categories: News of China

Working in Disneyland a dream job for many

A prospective candidate facing the interview board in Shanghai in October, 2015. The Shanghai Disney Resort, expected to open early next year, is set to create more new job opportunities in the city.

As Shanghai Disneyland stands 98 days away from unveiling its wonders to the public, employee recruitment becomes the priority this month, Shanghai Morning Post reported Thursday.

The tempting benefit and career development the company provides keep job hunters willingly lining up in the cold. It takes five to six hours to finish the interview.

Ms. Shen, who walked out of the Disneyland recruitment office at 3pm Wednesday, told a reporter that she arrived at 10 am and had just finished the interview. Trying to get a job with the retailing service booth, she didn't make a reservation online and found herself waiting with other 30 people early in the morning.

"If your online application got accepted, you can just walk in and join the next round of interviews," she said.

"Many applicants got denied because of the lack of experience or their age... sometimes they eliminate an applicant within a minute."

The reporter found that few applicants got job offers. Ms. Zhang, a college student, got a job as an intern and could only be hired after she graduated and make through the trial phase of the job.

Ms. Shen was one of the lucky applicants who made it to the final interview. "I was told that all positions are very popular," she said.

Even though all positions are filled at this point, there's still a 'waiting list' posted by the company's HR department. Anyone on the list has a chance to be hired once there's a job opening, the newspaper said.

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Permalink 10:14:09 am, by dacare, 115 words, 181 views   English (US)
Categories: News of China

Taiwan inflation rises on surging food prices

Taiwan's consumer price index (CPI) rose at its fastest pace in three years in February, the island's statistics agency said on Tuesday.

The 2.4 percent year on year rise was mainly due to higher prices for vegetables, fruits, aquatic products and household electricity, the agency said.

The authority said vegetable supply was limited by a cold front that hit Taiwan in January, and meanwhile food demand was higher around the Chinese Lunar New Year holidays.

In the first two months, the CPI rose 1.6 percent year on year.

The wholesale price index declined by 4.93 percent year on year last month, mainly due to the price of metal, crude oil, coal and chemical products falling, the agency said.

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Permalink 11:05:14 am, by dacare, 718 words, 209 views   English (US)
Categories: News of China

Online vendors promote the digital wallet

In the battle for third-party payment users, fees may loom large in artillery.

Internet giant Tencent recently stirred heated debate among netizens by slapping a commission charge on users who transfer 1,000 yuan ($154) or more from their WeChat "pocket money" to debit cards.

The commission amounts to 0.1 percent of the transfer amount once it exceeds the 1,000-yuan life-time free allowance.

Online reaction to the new fee drew comparisons with Tencent archrival Alibaba, whose affiliate Zhejiang Ant Small Financial Services Group operates the popular online payment service Alipay.

In 2013, Alipay started to charge commissions on transfers between Alipay accounts for users on desktop computers. The rate ranges from 0.15 percent to 0.2 percent. Transfers from smartphone users' Alipay balance accounts to debit cards remain free.

Tencent set its threshold at 1,000 yuan because most users' pocket money balances are below that figure. Users who register a separate WeChat account or debit card won't be exempt from the rules.

China had 358 million mobile payment users at the end of 2015, up 65 percent from a year earlier. The proportion of online payment customers among smartphone users grew to 58 percent from 39 percent at the end of 2014, according to a report published in January by the state-backed China Internet Network Information Center.

Walking around downtown Shanghai, it's easy to find convenience stores, coffee shops and snack bars that accept Alipay and WeChat payment services, not to mention the existing point-of-sale machines.

Tencent said its WeChat can be used for payments at more than 300,000 offline vendors nationwide, and Alipay's offline payment network operates on a similar scale.

Market response

Most of my friends say the impact of the new rule is marginal.

"Several hundred yuan of pocket money is really no big deal with WeChat payment services available at so many online vendors and offline merchants," said Shanghai resident Chris Xu, who is in her early 30s.

Others are more pragmatic. "I will ask my friends to transfer money directly to my bank accounts or Alipay accounts since I don't want to pay any additional fees if I wish to move my money from my account to my debit card in case of emergency," said Shanghai office clerk Doris Li said.

Very few consumers have undying loyalty to only one payment service. Most people choose whatever discount is available from either of the payment service providers.

An internal survey of more than 17,000 urban WeChat users by Tencent shows that nearly 30 percent who receive e-Hongbao (or digital "red envelope" money) have transferred their balance into debit cards, while only 12 percent have used their balance to pay for online shopping orders.

More than 78 percent of users passed e-Hongbao on to other friends and colleagues.

Some 200 million people have connected their credit or debit cards to their WeChat accounts.

A Tencent official insisted the new fee is to cover part of the cost of online payment services that connect with banks and to optimize support for small-sum transfers between WeChat accounts, which would be free of charge compared with a daily free-of-charge limit of 20,000 yuan.

Explanations aside, it's obvious that Tencent is hoping to create a de-facto virtual bank account system where one can use pocket money either to pay bills or buy merchandise from offline vendors.

Independent industry watcher Wang Yunhui said the exponential growth of e-Hongbao lands Tencent in the dilemma of transaction sizes and ever-climbing costs to connect its payment service with banks' online small sum payment systems.

"Tencent needs to give users incentives to use their account balance for online or offline payments," he added.

Besides, that would be a boost for wealth management products sold on the WeChat platform, he said. The wealth management platform, which is a stand-alone feature in the WeChat application, currently connects with 10 mutual fund and insurance companies, with combined transaction volume of about 100 billion yuan.

Currently, WeChat's pocket money can be used to pay credit card bills at 23 domestic banks.

Alipay, which is expanding its service network, drew more users during its Chinese New Year campaign last month. Its continuing efforts to team up with offline vendors and wealth management companies and financial institutions ratchets up the battle for users.

Now with Apple's contactless payment service Apple Pay available to Apple's smartphone users, consumers will have even more options. That opens up a wide horizon for more innovative services to be introduced.

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Permalink 10:34:54 am, by dacare, 409 words, 204 views   English (US)
Categories: News of China

Air-conditioner maker Gree to buy electric car company

An outlet of Gree Electric Appliances Inc in Yichang, Hubei province.

Gree Electric Appliances Inc, a leading Chinese home appliances maker, is planning to branch into new-energy vehicles by acquiring a local electric car producer which controls a Nasdaq-listed US battery firm.

It's the latest effort by China's largest air-conditioner manufacturer to diversify its business, as dwindling air-conditioner sales weigh on revenue and profitability.

Gree is planning to issue new shares to buy Zhuhai Yinlong New Energy Co, which itself is the controlling shareholder in Altair Nanotechnologies Inc, a Nevada-based lithium battery company, the company said on Sunday.

Headquartered in Zhuhai, Guangdong province, Gree did not disclose what stake it would take in Zhuhai Yinlong or the possible investment value. A spokesman for Gree said details are sill under discussions.

Zhuhai Yinlong was China's seventh-largest seller of electric buses in 2015, after racking up 7,000 orders and producing more than 3,100 electric vehicles, data from its official website show.

With three production bases across the country, it has the capacity to make 33,000 electric buses and 100,000 electricity-powered SUVs yearly.

Liu Buchen, an independent researcher on the home appliances sector, said its move comes as Gree is under mounting pressure to seek for new growth points.

"Gree generates about 95 percent of its revenue from selling air conditioners," Liu said.

"But over-reliance on a single product is increasing the company's financial risks, especially as the air-conditioner industry is having bad years."

In the first three quarters of 2015, Gree's revenue plunged more than 17 percent year-on-year to 81.5 billion yuan ($12.5 billion) due to overcapacity and weakening demand.

"Undoubtedly, the new-energy vehicle market boasts huge growth potential, but it is difficult to say whether that can be Gree's opportunity, given the fierce competition," he added.

Internet giants Tencent Holdings Ltd and Baidu Inc, as well as e-commerce heavyweight Alibaba Group Holding Ltd are all eyeing the sector through either partnerships or acquisitions, partly stimulated by strong policy support from the government.

Last year, sales of new-energy vehicles more than tripled to more than 331,000 units in China, including more than 247,000 pure electric cars and 83,600 plug-in hybrids, according to the China Association of Automobile Manufacturers.

The central government expects that cumulative sales of new-energy vehicles to reach 5 million units from 2012 to 2020.

Gree's interest in new-energy vehicles is not the company's first step to branch beyond the home appliances sector.

In 2015, it launched a 1,600 yuan smartphone designed to meet consumers' growing demand for quality products, but sales failed to meet Gree's expectations.

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Permalink 10:36:30 am, by dacare, 115 words, 184 views   English (US)
Categories: News of China

Adidas to add 3,000 outlets

Adidas aims to add 3,000 stores in China in the next five years to the current 9,000 nationwide as the German sportswear and apparel group expects emerging cities to contribute to over 60 percent of sales.

"More than 60 percent of our sales increase will be coming from emerging cities in the next five years thanks to an increase in consumer purchases," Colin Currie, managing director of Adidas Group China, said yesterday.

The company's sales in China rose 16 percent on a currency-neutral basis in the fourth quarter. Full-year sales jumped 18 percent to 2.5 billion euros (US$2.75 billion) in China.

The company also aims to open 20 women specialty stores in China by the end of 2020, compared with the current four outlets.

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Permalink 10:48:31 am, by dacare, 401 words, 232 views   English (US)
Categories: News of China

Women driving growth of online-to-offline business in China

Females have become the driving force behind China's booming online-to-offline shopping sector, despite their minority position in the country's overall Internet-using population.

According to a new report from group-buying e-commerce website Baidu Nuomi, women now account for 46 percent of the country's Internet users, but they generate 62 percent of O2O revenues.

Baidu Nuomi claims it now accounts for a fifth of daily O2O sales?a rapidly growing market that enables online customers to pay online for bricks-and-mortar services, such as movie tickets and restaurant bookings.

Tang Lihua, a director at Baidu Nuomi, said the results show that attracting, then retaining, female shoppers has become critical for any O2O platform.

"We plan to provide more baby-related and beauty-related services and products, for instance, in order to further grow our business, as we think that's likely to be strong selling-point for women," she said.

The study showed that since the start of 2015, female O2O spending has far-outstripped that by males, and the gap is growing, particularly during the country's flagship shopping events such as Qixi, Chinese Valentines Day.

As well as the beauty-related sector, women outspent men in other lucrative areas, too, including gyms and leisure, and hotels, said the report.

Gao Shuang, an analyst with China Internet Network Information Center, said the main reason is simple: Women are more decisive when it comes to shopping.

"They are not only buying for themselves, they are also shopping for their parents, their husbands and children," she said, adding their pickiness, too, is also driving up improvements in services and product innovation.

According to the center's statistics, the number of female online shoppers grew to 180 million by the end of 2015, more than double the number in 2010.

They also showed female online shoppers spend 4.17 hours a day surfing the Internet, against a daily average of 3.74 hours by all Internet users in China.

Restaurants, travel spending and movie trips were the top three O2O sellers for women.

Zhou Shu, a senior executive at Yuxiang Renjia, a restaurant chain specialized in Sichuan dishes, said it had certainly noticed that women have the stronger say when it comes to deciding where to eat.

"And they are more willing to try new services and new products," she said.

"Most importantly, though, they are happy to communicate and exchange their feedback after eating at a new restaurant, which makes them more influential in the O2O market."

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Permalink 09:39:02 am, by dacare, 263 words, 153 views   English (US)
Categories: News of China

Foreign businesses positive on Shanghai

Foreign businesses are confident of Shanghai's growth prospect and eager to engage in the city's various development strategies, participants said during a briefing by Shanghai's commerce affairs yesterday.

More than 500 people, including foreign diplomats, executives of foreign-invested companies in Shanghai and local government officials, attended the annual meeting hosted by the Shanghai Commission of Commerce.

"Shanghai will try to maintain a stable economic growth rate and accelerate the industrial restructuring to further raise the city's growth quality," Vice Mayor Zhou Bo told the gathering. "We sincerely hope foreign investors will continue to help us in the process."

Lee Min-ho, director-general of Korea Trade-Investment Promotion Agency (KOTRA) in Shanghai, said South Korean companies are expecting more interaction with China after the implementation of the free trade agreement signed last year between the two countries.

"Our investors are confident that bilateral trade will get a boost this year thanks to the free trade agreement, in particular in areas like fashion, health, cosmetics and tourism," Lee said.

"Shanghai is an important hub for China's trade of consumer goods ... we will enhance our operation here," Lee said.

Indonesia's Consul General in Shanghai, Kenssy D Ekaningsih, said her country was eager to engage in China's Belt and Road initiative.

"We have seen massive scale of operation in place under the initiative in the past two years," Ekaningsih said. "It is of huge importance for us because Indonesia stands at a core geographic location in the maritime Silk Road ... we hope our presence in Shanghai will play a constructive role in bolstering bilateral economic and cultural interaction," Ekaningsih said.

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Permalink 12:58:39 pm, by dacare, 452 words, 192 views   English (US)
Categories: News of China

Manufacturing continues to decline

China's economy continued to weaken in February with activity slowing in both the manufacturing and service sectors, according to the latest figures.

The official Purchasing Managers' Index, a comprehensive gauge reflecting operational conditions in largely state-owned manufacturing companies, fell 0.4 points from January to 49 last month, according to the National Bureau of Statistics and the China Federation of Logistics and Purchasing, below the 50 mark that separates contraction from expansion.

It was the seventh consecutive month manufacturing had been below 50.

The official non-manufacturing PMI, a counterpart for the service sector, fell to 52.7 in February, down from 53.5 a month earlier.

Bureau analyst Zhao Qinghe said factors including production being suspended during the Spring Festival holiday, which also led to less demand, were major reasons for the continuing decline.

The manufacturing PMI's component indexes showed production fell to 50.2 last month, down from January's 51.4. New orders lost 0.9 points to 48.6, staying below 50 for the second straight month. The purchase volume of raw materials lost 1.1 points to 47.9, while employment retreated 0.2 points to 47.6, both worse than a year earlier.

"The overall performance was disappointing," Zhao said. "But there were some positive signs such as a small rebound in the price of crude oil that led to higher sub-index measuring the costs of raw materials. Meanwhile, with the implementation of supportive policies, we have seen strengthened confidence among industrial companies."

The price of raw materials rose 5.1 points to 50.2 last month, above 50 for the first time since August 2014.

Liu Ligang, chief economist at Australia & New Zealand Banking Group Ltd, said the figures suggested policy-makers may take further measures to manage an economic growth target of between 6.5 percent and 7 percent for 2016.

"The proactive fiscal policy will be needed to support investments and we expect the fiscal deficit could be increased to a range of 3 percent to 4 percent of the economic output in 2016, up from 2.3 percent in 2015," Liu said.

Robert Subbaraman, chief economist of Asia (ex-Japan) at Nomura, said earlier that China needed to expand fiscal investments, but should be cautious not to slow industrial restructuring.

In line with the worsening performance of state-owned industrial companies, their private and export-oriented counterparts also reported weakening activity.

The Caixin China PMI, an indicator slanted toward private and export-oriented manufacturing companies, landed at 48 in February, a five-month low that was down from 48.4 in January, according to the Caixin magazine and research firm Markit.

He Fan, chief economist at Caixin Insight Group, said: "The government needs to press ahead with reforms, while adopting moderate stimulus policies and strengthening support of the economy in other ways to prevent it from falling off a cliff."

China's gross domestic product grew 6.8 percent in the fourth quarter of last year, concluding 2015 with a rate of 6.9 percent, the slowest growth in 25 years.

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Permalink 10:52:52 am, by dacare, 461 words, 207 views   English (US)
Categories: News of China

Qualcomm JV to focus on drones and robots

Thundercomm will have access to intellectual patents from U.S. chip giant

Qualcomm Inc on Monday set up a joint venture with a Chinese tech firm to develop technologies used in drones, virtual reality goggles and other "smart devices" that the U.S. chip giant believes will be the next big thing after the smartphone boom.

The new JV, named Thundercomm, will provide products and technologies for local firms which are building the next-generation drones, robots, VR devices and wearables, according to a statement from Qualcomm and its Chinese partner Thunder Software Technology Co Ltd, or Thundersoft.

The registered capital of Thundercomm was 18.74 million yuan ($2.8 million) and the Beijing-based Thundersoft will control nearly 82 percent of the JV, according to a statement from Thundersoft. An investment subsidiary of Qualcomm took the rest of the new company's stake.

The JV will be located at the Fairy Peach Data Valley in Yubei District, southwest China's Chongqing municipality. The inland mega city has become one of the world's largest manufacturing bases of the smart devices in recent years.

Zhang Shutao, general manager of Thundercomm, said the JV will get to use intellectual patents from Qualcomm.

"We will have a lot opportunities to work with Qualcomm in IP, ... the JV will find ways to help customers get access to Qualcomm's IPs," Zhang said.

Frank Meng, chairman of Qualcomm China, told China Daily in an exclusive interview earlier this month Chinese startups are set to lead the world in innovation in an array of emerging sectors.

Chinese tech firms are making technological breakthroughs instead of waiting for ideas imported from overseas companies, said Meng.

"Local vendors are coming up with gigantic amount of ideas that suit requirements of Chinese customers. Qualcomm wants to be a part of this new trend that will unlock another trillion-yuan market," said the 56-year-old.

Ma Longwen, an analyst from Changjiang Securities Co, said the new JV will give an edge to Thundersoft in many areas, including drone making, smart automobile and VR.

"It requires a large number of high-end chips to make a drone, as global orders for drones reaching the highest level on record, the JV is facing a huge market demand because it is endorsed by Qualcomm technologies," according to Ma.

While sectors such as VR and operating system used in automobiles are not big today, they are set to receive huge user base like smartphones did, he added.

The establishment of Thundercomm was also the first major China investment from Qualcomm since it set up a Guizhou-registered firm to manage investments on the Chinese mainland in January.

Qualcomm is moving its investment focus to inland provinces to echo a number of national strategies aimed to boost economy in the less-developed regions taking advantage of the Internet and new technologies.

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Permalink 02:14:25 pm, by dacare, 502 words, 207 views   English (US)
Categories: News of China

New challenges emerge as more workers age

China has a huge number of migrant workers. They usually come from rural areas across the country, and work in cities to seek a better life.

This phenomenon came into being after China's Reform and Opening up policy was introduced in the late 1970s. It meant a larger labour force was needed to meet the demands of the burgeoning economy. Now, as over three decades have passed, this specific industry faces new challenges and changes.

A new landmark for China's capital. This building under construction will be the highest one in Beijing in two year's time. It's another masterpiece straight out of a designer's hands, and a masterpiece by its builders as well.

Li Shaohua, now approaching his 50s, is one of them. He has worked for 20 years as a migrant worke and now he worries about his age.

"As I am getting older now. I would like to spend more time with my family. It's no longer suitable for me to stay in this industry," he said.

It's rare to see a young face like Wu Chunxi at this construction site. There are less young workers in China, as a result of family planning policies. Wu says he won't stay in this industry for long.

"I will stay in this industry for several more years to earn some money. Then I will go back home, start my own family, open a small business, and ensure a happy life for my family," Wu said.

The average age of China's migrant workers is higher than ever before. Of the 270 million across the country, nearly 20% of them are more than 50 years old. And their lack of education means it's difficult for them to acquire new skills.

Li Shaohua graduated from a local middle school in central China's Hubei province. He says, besides old age, he is also concerned about his education level.

"If I got a much higher education level, I would take a job in the management team. However, due to the lack of education, I could only work here as a worker," Li said.

Wu Chunxi is luckier since his college education allows him to take a job as an electrician.

"The knowledge I picked up at school, along with the working experience here, makes me learn new things more quickly than others. I can read the circuit diagram, and I learn quite a lot of new things here," he said.

China's economy has entered a "new normal" development phase. It features slower growth but higher efficiency. Migrant workers, those that usually remain disadvantaged in terms of age and education are the first to be affected.

Starting from the latter half of 2015, many chose to return back home from cities. The number of returnees reached two million in November, 2015.

Li Shaohua is happy to talk about his plans for his retirement. He can either grow crops or start a business of his own. But one thing he is certain of is that he would encourage his son to get a college education....

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Permalink 10:35:33 am, by dacare, 149 words, 251 views   English (US)
Categories: News of China

China to allocate 100 bln yuan for job losses from capacity cuts

China will establish a 100 billion yuan (15.3 billion U.S. dollars) fund to assist those who are made redundant as a result of industrial restructuring, an official said Thursday.

Allocated over two years, the fund will cover training and job seeking, said Feng Fei, vice minister of industry and information technology, at a press conference.

The processes of dealing with poor-performing "zombie companies," and undertaking mergers and acquisitions mean that job losses will be inevitable. Thus, re-employing workers will be a major task, Feng said.

Cutting overcapacity was listed as one of the five major tasks in supply-side structural reform along with destocking, deleveraging, reducing costs and shoring up weak growth areas.

The government has stepped up efforts to slash excess production capacity in saturated sectors, especially steel and coal. From 2011 to 2015, 91 million tonnes of outdated capacity in the iron industry and 94.8 million tonnes in the steel industry were eliminated.

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Permalink 10:36:54 am, by dacare, 260 words, 243 views   English (US)
Categories: News of China

Companies scramble to hire skilled labor

More skilled workers are needed in Dongguan, a traditional manufacturing base in Guangdong province, as local companies begin looking for qualified employees after Spring Festival to help transfer their businesses into the high-tech sector.

CKE-Tech, which focuses on production and sales of precision machinery, is looking for about 10 more engineers this year as the company increases its efforts in research and development.

"We are looking for more skilled workers, but it is really difficult to find the right ones," said Chen Guiping, a human resource manager with the company.

The company will provide about 6,000 yuan ($920) per month for a skilled worker, higher than the previous year.

A growing number of manufacturing companies have increased investment in research and development in recent years, resulting in the need for more skilled workers and engineers, according to Chen.

CKE-Tech is one of the hundreds of businesses ranging from furniture, garments, electronics and toys that are transitioning from traditional manufacturing to more service-oriented models.

By Feb 17, more than 77 percent of Dongguan workers had returned to their jobs, according to the local human resource authority.

In the past, some companies could not begin factory operations after Spring Festival due to a lack of workers.

"But now, a growing number of local companies have introduced high-tech processing equipment, including robots," said Li Guochen, a professor at Dongguan Polytechnic.

Some labor-intensive businesses, however, have still found it hard to recruit new workers.

According to the Dongguan human resources authority, companies involved in shoes, garments and plastics have a relatively larger shortage of labor for their processing lines.

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Permalink 02:35:49 pm, by dacare, 543 words, 205 views   English (US)
Categories: News of China

Workers scramble for day jobs in Hebei

Farmers wait for their potential employers at a roadside labor market in Shijiazhuang, Hebei province.

Wang Shuji is typical of the workers who gather each morning at local labor markets, the self-forming roadside gathering places for those seeking day jobs in Hebei province.

Wang, 43, is a farmer who seek short-term employment in towns or cities near his home. Capable of doing most kinds of odd jobs, he mainly works at construction sites, building walls or carrying materials.

Most mornings, he gets up at 6 o'clock, eats some instant noodles and rides his electric bike the 20-plus kilometers from his home in Dazhaicun village to Shijiazhuang, Hebei's capital.

"I usually rush there, not to punch in like company employees, but to be picked up by employers as soon as possible," he said.

After he gets to the market, he must wait for employers to arrive, then rush toward them.

"When an employer came, there would be a stampede toward him or her, just like fans toward singing stars," Wang said. "But we were not chasing after stars, we were scrambling for jobs the employer was going to provide."

He speaks loudly, trying to be heard over the other job hunters.

"What kind of workers do you need? How many workers do you want? How much would you pay me for a day? I can do it. Take me. OK, where is the workplace? How should I go? I have an electric bikes, so I can go by myself," Wang said, recalling the exchanges.

After the questioning, employers usually decide within five minutes whether someone was suitable for the job.

"There are scores of peasant workers there, so the chance of being chosen would be very low if you are not quick enough," Wang said. "If I came early, I would have more chance to compete for jobs and start a day's work early, which would lead to more money."

Yang Kang, manager of a local construction company, said it's convenient to find temporary employees from roadside labor markets and the pay is relatively low.

"There would be commissions to pay if I find workers through brokerage firms," Yang said.

Last Friday, Wang waited until 10:30 am, but still didn't get a job.

"It was common. I usually wait a whole morning or even a day, but get nothing," Wang said. "The numbers of employers coming here will increase to normal after the Lantern Festival."

When asked why he didn't find a steady job that could give him regular salary and spare him the daily competition for jobs, Wang said he didn't have much choice with only a junior high school education background.

"It's not that I don't want a steady and cushy job," Wang said. "I am very suitable for a stable job like a security guard at shopping malls or factories."

But he always refused such offers because the jobs are not well paid at just 1,500 yuan ($230) or so for a month.

"I can earn about 3,000 yuan a month on average by finding jobs from the market, though I'm more tired," Wang said.

Wang said he dislikes formal labor markets as they are far away and not as convenient as the roadside ones. "Besides, it's complicated for us to register or complete applications," he said.

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Permalink 04:27:56 pm, by dacare, 609 words, 191 views   English (US)
Categories: News of China

Multinationals eye China market as consumption pattern shifts

On its launch day in China, Apple Pay saw over 30 million Chinese bank cards linked to the payment service, an achievement that impressed Apple Pay vice president Jennifer Bailey.

"We think China could be our largest Apple Pay market," Bailey told media last Thursday.

To lure more customers, some of Apple Pay's partner banks worked with Starbucks to offer discounts to customers who pay with Apple Pay.

With wages up and people accumulating wealth, the rising middle class is driving a major shift in China's consumption pattern, making the country a huge market that multinationals can ill afford to ignore.

Increasingly, Chinese are able to afford more than just the bare necessities. Instead, they spend on things they like but don't need, those "discretionary items."

According to data from consulting firm McKinsey & Co., discretionary spending is forecast to grow over 7 percent annually between 2010 to 2020, while seminecessities, including health care and apparel, will expand around 6 to 7 percent, all surpassing the growth rate of actual necessities.

The shift is already seen in satisfying results reported by companies selling high-end products, such as Apple.

While an iPhone costs almost five times the average price of a domestic smart phone, Apple has a substantial consumer base in China that not only pays for the phone itself but for the brand.

"There's an enormous number of people moving into the middle class and I think this provides us with great opportunities to win over some of these customers into the Apple ecosystem," said Tim Cook, Apple's chief executive during an earnings call.

"We remain very bullish on China, and don't subscribe to the doom and gloom kind of predictions frankly." Cook said.

The Chinese middle class for the first time outnumbered those in the United States in 2015, hitting 109 million at the American standard after purchasing power is adjusted, according to a report by Credit Suiss.

And the number continues to climb. In 2015, China's national per capita disposable income rose 7.4 percent from 2014 in real terms, outpacing GDP growth.

Seeing the opportunities of an increasingly well-off society, foreign firms are tapping into China's entertainment industry to monetize on the growing interest in the high-end recreational market.

American film studio 20th Century Fox, for example, told China Daily recently that it had chosen Beijing to be the destination of the world's first ever Simpsons store.

To be opened in March, the store will offer merchandises related to the American animated sitcom, which has proven to be very popular in China.

The decision followed a similar move by Walt Disney Co., which opened the world's largest Disney store in Shanghai in May 2015 to huge queues of customers.

The domestic entertainment industry is also taking off thanks to this shift. During the Spring Festival holiday, box office sales surged 67 percent year on year to 3 billion yuan.

Spending on recreational activities including travel, dining, sports, and gaming in China still lags behind the developed world, and "fun" has the biggest potential for growth, said a Goldman Sachs report on consumer research.

"There's a perception that China's consumption story has already played out," said Joshua Lu, co-business unit leader of asia consumer research at Goldman Sachs. "In the coming decade, in a way the story is even more exciting as hundreds of millions will see their income doubling and enter the middle class. That migration will continue to be a powerful driver of the China consumption growth story."

In 2015, consumption contributed 66.4 percent to China's gross domestic product, up 15.4 percentage points from 2014.

As China transitions into a more consumption-driven economy, global companies should make smarter, higher-quality products to adapt, too. After all, consumers are what really matter for most of them.

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Permalink 10:39:13 am, by dacare, 254 words, 266 views   English (US)
Categories: News of China

Fosun’s deal for Phoenix ditched

Shanghai-based Fosun has dropped a plan to buy a controlling stake in Israeli insurer Phoenix Holdings because certain conditions for the deal were not met, a statement said yesterday.

Fosun had agreed to buy 52.31 percent in Phoenix from Delek Group in June last year in a deal worth $462 million.

The Chinese company yesterday said the two parties decided to terminate the deal as "certain conditions" have not been "fulfilled or waived," Fosun International said in a statement filed to the Hong Kong stock exchange.

Neither party is obliged to pay a penalty, the statement added.

Shares of Hong Kong-listed Fosun International lost 1.14 percent yesterday, lagging the 1.03 percent fall in the Hang Seng Index.

In a separate statement yesterday, Delek said it is evaluating other options for the sale of its holding in Phoenix to potential investors.

The termination is the first major setback for Fosun after its chairman, Guo Guangchang, was briefly taken by authorities in December last year to assist an investigation as part of the Chinese government's anti-corruption campaign.

The Tel Aviv Stock Exchange suspended trading in Phoenix and its parent company Delek after Guo went missing.

Israeli newspaper Globes said last month the country's Supervisor of Insurance, Capital Market and Savings, Dorit Salinger, was not likely to approve Fosun Group as the controlling shareholder in Phoenix.

Fosun now has over one-third of its total assets invested in insurance, including Yong'an P&C Insurance, Pramerica Fosun Life Insurance, Hong Kong-based Peak Reinsurance, Portugal's Fidelidade Group, US-based Meadowbrook Insurance Group and Ironshore.

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Permalink 10:36:38 am, by dacare, 489 words, 197 views   English (US)
Categories: News of China

Chinese buyers buoy Shiseido sales

A man checks out a Shiseido Co Ltd's beauty products advertisement in Beijing. The Japanese company's China business grew by only 2 percent last year.

One of Japan's leading personal care companies has reported strong demand for its products from Chinese visitors to the country, despite weaker growth in the Chinese market itself.

The latest figures from Shiseido Co Ltd revealed its 2015 annual sales rose 12.6 percent to 763.1 billion yen ($6.7 billion). Analysts said that the increase was helped significantly by Chinese tourist sales.

The group's operating income rose 77.4 percent to 37.7 billion yen, but its China business grew by just 2 percent.

"We have seen a substantial increase, both in sales and income, mainly due to our major brands in the domestic market," said Norio Tadakawa, its corporate officer and CFO, who added both its operations in Beijing and Shanghai struggled last year.

Sales at its Shanghai outlet have been flat for several years, he said, adding the firm is now planning to reverse that with a targeted 10 percent growth this year in China.

In the medium to longer term, he said, "we are seeing more of the middle-class market, so we will keep on expanding consumption and diversification" of products, adding its e-commerce business is expected to grow 20 percent in China.

Tadakawa said Shiseido is also planning a new innovation center in China, which will help the firm grow market share.

He admitted, however, that competition from South Korean brands is intensifying, making its job in China harder.

According to Kantar Worldpanel China, sales of South Korean cosmetic brands are now growing faster than Japanese brands, at 33 percent compared with 11.6 percent, focused mainly on high-end products.

Shiseido's results followed closely on the heels of those from Japanese beauty care rival Kao Corp, which announced net sales increased 5 percent compared with the previous year to 1.47 trillion yen for the year ended Dec 31.

Its profits increased, said officials, due to the effect of increased sales of healthcare products in markets across Asia.

Net income increased 19.3 billion yen compared with the previous fiscal year to 98.9 billion yen, with beauty sales increasing 3 percent, while cosmetics sales decreased 2.3 percent.

Laurie Du, an analyst at Mintel Group Ltd, the United Kingdom-based research firm, said Chinese consumers have gained more awareness of international brands through frequent overseas travel, especially for Japanese goods bought in Japan.

Du said products made in Japan now represented 29 percent of all skincare product sales by Chinese travelers, which is higher than goods from both South Korea and France.

"Chinese consumers strongly believe in the competitiveness, quality and price of Japanese products," she said.

Jason Yu, general manager of Kantar Worldpanel China, said it had also seen a significant rise in demand for everyday Japanese fast-moving-consumer products by Chinese buyers in Japan.

But he added that it remains critical for Japanese marketers to expand their product offerings to avoid missing out on what are likely to be growing numbers of Chinese traveling overseas for goods.

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Permalink 12:43:46 pm, by dacare, 298 words, 192 views   English (US)
Categories: News of China

Dining, shopping and traveling lead in Spring Festival spending

Customers do shopping for the Spring Festival at a supermarket.

(ECNS) -- China UnionPay transactions soared to a record high in the week-long Lunar New Year holiday, with dining, shopping and travelling being the dominant elements, the operator revealed.

The total volume of transactions at home and abroad through China UnionPay cards amounted to 312.1 billion yuan ($47.6 billion), up 31 percent year on year. The total number of transactions reached 307 million, an increase of 15 percent, during the holiday from Feb. 7 to Feb. 13.

Card payments in supermarkets, on large household appliances and general merchandise continued to show robust growth, up 41 percent, 22 percent and 13 percent respectively.

Card spending in restaurants grew by 6 percent while the average spending was 585 yuan during this time. Guangdong, Shanghai, Beijing and Jiangsu led the country in terms of catering expenses, according to the report.

Data analyst Chen Han of China UnionPay said people usually prefer high-end restaurants and spend more during the most important festival in China.

Travelling was also popular in the seven-day holiday, with the volume of ticket purchase transactions in aviation, railway and highway passenger transportation increasing by 39 percent, 39 percent and 98 percent respectively.

One notable change is increased spending at gas stations by cardholders, at a growth rate of 39 percent, while it shows more people chose traveling by driving cars themselves, according to Chen.

An analysis of overseas card use found that more Chinese tourists spend the holiday in countries along the "Silk Road Economic Belt and the 21st-Century Maritime Silk Road," inlcuding Kazakhstan, Malaysia, Vietnam and Cambodia.

Spending witnessed a peak in the run-up to Spring Festival while the daily volume of transactions hit a record of 29.5 billion yuan on Feb 1.

China UnionPay is solely responsible for bank card transactions on the Chinese mainland and has extended its network to 150 countries and regions.

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Permalink 02:07:43 pm, by dacare, 210 words, 190 views   English (US)
Categories: News of China

China's major coal-production region slashes overcapacity

Guizhou, one of the country's major coal-producing provinces, shut down 183 mines in 2015 in a bid to cut obsolete capacity, according to local authorities.

Through closures, mergers and acquisitions, Guizhou has reduced its number of collieries in operation and under construction to less than 800 from about 1,700 since 2013, said a spokesman with the provincial energy administration.

It aims to close more than 80 others this year, said the spokesman.

Guizhou is the largest coal producer in southern China, with the country's fifth largest proven reserves. The province's move is part of a national campaign to cut overcapacity amid dwindling demand in the coal industry.

Earlier this month, the State Council issued a guideline saying no new coal mines would be approved in the following three years and the country will shut down 500 million tonnes of capacity and consolidate another 500 million tonnes into the hands of fewer but more efficient mine operators in the next three to five years.

Another coal-producing giant, north China's Shanxi Province, has decided to keep production under 1 billion tonnes per annum for the next five years. Its production in 2015 amounted to 944 million tonnes.

Shanxi has produced about one fourth of China's coal since 1949. However, the industry had suffered losses for 18 consecutive months by the end of 2015, beginning in July 2014.

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Permalink 12:42:49 pm, by dacare, 144 words, 177 views   English (US)
Categories: News of China

Spring Festival tourism revenue rises in Beijing

Tourists visit the Palace Museum, also known as the Forbidden City, during the Spring Festival holidays in Beijing, capital of China, Feb. 10, 2016.

Tourism revenue in Beijing rose 2.9 percent year on year during the week-long Spring Festival holiday, according to the municipal tourism commission.

Tourism revenue reached 4.92 billion yuan (753 million U.S. dollars) during the holiday, which began on Feb. 7, according to a statement released by the commission on Saturday.

The Spring Festival, or Chinese Lunar New Year, fell on Feb. 8 this year. It is the most important holiday in China for family reunions.

The number of tourists during the Spring Festival holiday topped 9.19 million in the city, up 1.9 percent from the same period last year, the statement said.

Historical sites, including the Forbidden City and the Great Wall as well as ski resorts and traditional temple fairs attracted most of the visitors, it said.

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Permalink 10:01:22 am, by dacare, 973 words, 403 views   English (US)
Categories: News of China

Disney Resort expected to bring realty-and-retail boom to Shanghai

Two sales people introduce a housing project to a potential buyer at a Disney commercial property promotion event.

Shanghai Disney Resort, which will open in June, is expected to transform the metropolis' economy

Lu Jianxin, a real estate agent with Shanghai Huayu Property Ltd, has had some of his busiest business weeks in January since he joined the sector in 2002. Lu receives more than 50 phone calls every day asking him if he can find unoccupied retail properties near Shanghai Disney Resort, the long-anticipated multi-billion-dollar amusement project that is scheduled to open this summer (June).

Typically, Lu tells his callers they should have acted earlier. "Supplies of retail properties are really limited now and prices have more than doubled in the past 12 months. Obviously, investors believe that even a 10 square meter space for a noodle stand will be really profitable if it is close enough to Disneyland," said Lu.

It's not just business-minded people who are all excited about Shanghai Disney. Even 13-year-old Zhang Zihao in Hangzhou, Zhejiang province, can't wait for Disney to open its gates. He has been saving his pocket money for a long time so he could visit Shanghai Disney Resort during the summer vacation.

"The admission ticket price is expected to be announced this week. I have saved 500 yuan ($75.92) so far for the ticket alone, and another 1,000 yuan for dining and accommodation, and another 500 yuan for merchandise like stuffed animals, stationery, T-shirts and gifts for friends. That's about 2,000 yuan in total."

The project has been under construction for more than six years now. Jun 16?that is, 6-16-2016?has been apparently chosen as the date of opening because the three 6s are believed to be auspicious, heralding success.

Real estate professionals believe any success of Shanghai Disney Resort would entail all-round benefits for the area. For example, visitors in huge numbers would likely spark a retail boom in Shanghai.

According to Centaline Property Agency, the average price of commercial properties within a 5 kilometer radius of Shanghai Disney Resort, including shops and restaurants, has grown more than 300 percent in the past five years.

What used to cost some 20,000 yuan per square meter in 2011 would now command a price of more than 60,000 yuan per square meter. Some properties are even priced more than 72,000 yuan per square meter, about 50 percent higher than that of other suburban areas in Shanghai.

The growth rate is among the highest for premier locations such as Nanjing Road, Huaihai Road and Lujiazui.

In comparison, the average price of residential properties in the same area doubled from 20,000 yuan per square meter to 40,000 yuan per square meter in the same period, similar to that of the city's average growth rate.

"Surging prices of commercial properties are a result of limited supply and great demand. We estimate that the prices may grow further but at a more steady pace in the second half of 2016, after the opening of the resort," said Joe Zhou, head of research for JLL East China.

Besides the Disney fever, another reason for the rocketing retail property prices is the expectation that foodfalls will be huge, exceeding 10 million visitors/trips in the first year, and reaching some 30 million in the years to come.

Their annual combined consumption in one year during Disney visits and other locations in the city may exceed 45 billion yuan, according to a report by commercial property services firm RET.

When 70 million visitors visited the May 1-Oct 31 Expo 2010 Shanghai China, their combined consumption exceeded 48 billion yuan, according to data of the city's Statistics Bureau. Spending on dining alone was more than 2 billion yuan.

Property market people expect Shanghai Disney Resort's impact on the retail market to be stronger than that of the 2010 Expo for the simple reason that the resort project is a permanent one, and may attract visitors who wish to stay in the city for a longer time.

Lu Wenxi, manager of Centaline Property Agency, said it is estimated that for every 1 yuan spent on resort admission tickets, another 8 yuan will be spent on retail consumption such as dining, hotels, and franchised products.

"Just consider the more than 10,000 employees who work at Shanghai Disney and their day-to-day consumption in the neighborhood. The combined size is huge, and it will not only benefit the resort but the entire city," said Lu.

Urban infrastructure in the Shanghai Disney Resort area and its neighborhood will further facilitate visitors' traffic, dining, accommodation and shopping, making consumption touch-points more accessible, said analysts.

The metropolis administration has already planned the Shanghai International Tourism and Resort Zone or SITRZ, an international tourism stretch covering 20.6 square km, including 13 square km for hotels, restaurants, entertainment centers, parks and sports facilities, which will be linked by two subway lines that will reach the city center.

Hotel chains have been developing new properties around the Disney project, including budget hotel chains such as GreenTree Inn and Jinjiang Inns. As many as 1,000 bed-and-breakfast rooms may be available in villages that are close to the Disney resort when they pass the safety and other requirements to serve visitors demands, according to Pudong District authorities.

Department stores and outlets are also under development around the resort.

In 2014, retail outlet developers Value Retail and Shanghai Shendi Group, the operator of SITRZ, announced a joint venture to build luxury shopping compound next to the Shanghai Disney Resort covering 50,000 square meters, hosting more than 100 brands.

Siu Wing Chu, head of retail at Savills China, said key retail hubs in Shanghai, including the Yuyuan Garden, the Bund, Huaihai Road and Nanjing Road are all going through brand upgradation and renovations, to sport a new, cheery look.

"We have seen several franchised Disney product stores scattered around Shanghai, and we believe that visitors to Shanghai Disney will also go sight-seeing around the Bund, Nanjing Road and Yuyuan Garden area. We expect rentals to grow in these key locations," said Chu.

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Permalink 02:02:31 pm, by dacare, 188 words, 237 views   English (US)
Categories: News of China

Alibaba says revenue jumped 32% in third quarter, announces strategies for 2016

Chinese e-commerce giant Alibaba Group Holding's revenue rose 32 percent year-on-year to 34.53 billion yuan ($5.25 billion) in the fiscal third quarter ended December 31, 2015, according to an earnings report released by the company late Thursday.

The Internet titan attributed the increase to the continued rapid growth of the domestic e-commerce retail business, its financial report said.

The company is committed to deliver a good consumer experience and help merchants attract, engage and retain buyers, CEO Zhang Yong was quoted as saying in the report.

"We remain focused on our top strategic priorities, including global imports, rural expansion, increasing our footprint in first-tier Chinese cities and building a world-class cloud computing business," Zhang said.

Revenue rose compared with the average analyst estimate of 33.33 billion yuan, helped by holiday shopping during the quarter, Reuters reported Thursday.

Gross merchandise volume, or the total value of goods transacted on its platforms, rose 23 percent to 964 billion yuan, the company said.

The company also announced its plans for 2016. It said it will launch the Alibaba Chinese New Year Shopping Festival.

Alibaba's U.S.-listed shares rose more than 4 percent in opening trading immediately following the company's announcement.

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Permalink 02:14:27 pm, by dacare, 236 words, 198 views   English (US)
Categories: News of China

Whole-year profits of industrial companies stumble

Chinese full-year industrial profit dropped by 2.3 percent last year, raising the risk of a rash of debt defaults amid a weaker economic growth outlook.

In December, the total profit of industrial companies fell by 4.7 percent from a year earlier, after undergoing a 1.4 percent year-on-year decline in November, according to data released by the National Bureau of Statistics on Tuesday.

The last time a full-year profit drop was recorded was 18 years ago, when annual profit plummeted by 17 percent amid the Asian financial crisis.

He Ping, a senior NBS economist, wrote on the bureau's website that weak demand and long-term decline in factory-gate prices - what distributors pay producers for goods - dramatically decelerated industrial production and sales.

"High costs and tight cash flows also constrained industrial companies' production," he said.

Lian Ping, chief economist at the Bank of Communications, said nonperforming bank loans to industrial companies are likely to quickly rise this year, as deflation continues and the government takes more steps to reduce overcapacity, particularly in unprofitable industries.

NBS data show that total profits of State-owned industrial companies fell by 21.9 percent year-on-year in 2015 to 1.09 trillion yuan ($165.7 billion), while private companies gained 2.32 trillion yuan in profits, representing an increase of 3.7 percent.

Mining hit the strongest headwinds among industries last year, reporting a 58.2 percent decline in profit. Such declines were also concentrated in 11 other industries - including coal processing and steel - that struggle with serious overcapacity problems.

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Permalink 12:54:02 pm, by dacare, 338 words, 220 views   English (US)
Categories: News of China

Didi Kuaidi, China Merchants Bank announce partnership

China's top ride-hailing app Didi Kuaidi and leading private bank China Merchants Bank (CMB) on Tuesday announced a comprehensive strategic partnership that includes an equity investment, in-app credit card payments, joint bank cards, automobile financing services and driver recruitment.

The equity investment makes CMB latest addition to the mobile app's powerful backers that already includes Tencent, Alibaba, China Investment Corporation, Ping An Ventures, China International Capital Corporation, CITIC Capital, Beijing Automotive Group and others.

Neither side disclosed the amount of the investment. Didi Kuaidi raised a record-breaking 3 billion U.S. dollars last year.

At a press conference announcing the partnership, Jean Liu, president of Didi Kuaidi, called the CMB investment "a heavyweight", saying its relationship with CMB is "strong and trusting."

Liu said the partnership with CMB would enable the app to connect its financial and mobile online-to-offline platforms to CMB's experience in the banking sector to build the world's largest online ride-hailing platform.

"In the spirit of openness and collaboration, Didi looks forward to building an ever stronger, broader transportation platform with China's leading financial and industry players," she said.

CMB customers will be able to pay fares with CMB credit cards. Both companies will begin accepting applications for joint CMB-Didi credit and savings cards through CMB's sales channels or Didi's app in the second quarter of this year.

Didi drivers and car owners will be able to finance vehicle purchases through CMB, with terms and payments based on a joint review by CMB and Didi. Didi Kuaidi and CMB will share client information in line with regulations.

Zhao Ju, executive vice president of CMB, said the deal with Didi would advance CMB's internet finance strategy in the sharing economy.

China has about 688 million Internet users and most of them spend money through their mobile phones every day, according to data from the China Internet Network Information Center.

With more than 250 million registered app users and 14 million registered drivers, Didi Kuaidi is one of the most popular apps and online payment platforms, recording 1.43 billion rides last year.

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Permalink 01:07:52 pm, by dacare, 480 words, 248 views   English (US)
Categories: News of China

Banks desperate to hire talent with digital skills

People wait for the opening of a China Merchants Bank's recruitment drive in Shanghai.

As digital banking takes hold, Chinese lenders are desperately seeking to hire professionals with skills in nine key fields, including big data analysis, mobile interface development, agile process management, digital user experience design and virtual payments.

They are focusing on management and career development of digital banking talents. Compensation packages, key performance indicators and appraisal criteria for such professional are being formulated anew, to be in line with technology companies, said The Boston Consulting Group in a report earlier this month.

David He, a partner and managing director of BCG, said traditional banks must figure out how to attract, retain and train digital talents, as well as where to deploy them. Top bank executives also have to decide whether to allow these professionals to develop freely or adjust the human resource management system accordingly.

Liu Xinyi, president of Shanghai Pudong Development Bank, said at a financial forum in June, "China deepened the interest rate liberalization in recent years, built a multilateral capital market and relaxed the control of market entry for private banks. These reform measures, along with the booming of Internet finance, brought huge challenges to commercial banks and weakened their appeal to talents."

A growing number of professionals at various levels are being lured away from State-owned commercial banks by Internet companies and privately owned lenders with the promise of higher pay and career advancement.

The exodus of banking talents was also partly triggered by a government-led salary reform effective Jan 1, 2015 to promote equality at State-owned enterprises.

According to the draft plan, the annual pay of top executives in State-owned financial organizations will be cut by around 70 percent to a top annual compensation of 600,000 yuan ($91,560).

After leaving traditional banks, many experienced professionals and senior executives, however, found that it was hard for them to adapt to new culture and work style of Internet finance companies.

WeBank, the country's first online private bank, was jointly founded by domestic Internet giant Tencent Holdings Ltd and two local investment firms in December 2014.

Less than a year after WeBank received regulatory approval to start operations, its president Cao Tong and vice president Zheng Xinlin resigned. Both had many years of work experience at traditional banks.

Analysts cited the clash of corporate cultures of Internet-based companies and traditional banks as one of the reasons for their departure, in addition to a factional fight among the bank brass.

Even digital talents that migrated from Internet companies to commercial banks faced similar adaptability problems.

The BCG report said the two cultures are very different. Internet companies encourage trial and error, horizontal cooperation and open dialogue. They are flexible, client-centric and innovative. On the other hand, traditional banks are rigid, channel-oriented and risk-averse. They develop products based on technologies rather than consumers. Their decision-making process usually goes through multiple layers of management.

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Permalink 02:10:35 pm, by dacare, 127 words, 238 views   English (US)
Categories: News of China

Taiwan jobless rate at lowest level in 15 years

Unemployment in Taiwan was 3.78 percent last year, the lowest level since 2000, the island's statistics agency announced Friday.

This is a decrease from 3.96 percent posted in 2014, showing the job market is generally steady, the agency said in a press release.

There were around 440,000 unemployed people in Taiwan in 2015, compared with 11.2 million employed, it said.

The unemployment rate of the young (15 to 24 years old) was 12.05 percent, compared with 3.95 percent for the 25-44 age range, and 1.99 percent for those aged between 45 and 64.

In December alone, 3.87 percent of Taiwan's residents reported being unemployed, down from 3.91 percent for November.

The agency said in a separate statement that in the first 11 months of 2015, industrial and service sector employees had record high average monthly salaries -- around 48,650 New Taiwan dollars (about 1,445 U.S. dollars).

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Permalink 02:52:45 pm, by dacare, 364 words, 209 views   English (US)
Categories: News of China

Job site Zhaopin receives initial proposal to take firm private

Job hunters seek information at a stand.

Zhaopin Ltd, China's biggest job recruitment site, has received a non-binding offer to take the firm private, a year and a half after debuting on the New York Stock Exchange.

The company said on Wednesday it had received the preliminary proposal from affiliates of CDH Investments and Shanghai Goliath Investment Management LP.

Zhaopin said it considered the acquisition offer a fairly high valuation from the two noted investment institutions.

Officials said its board of directors are currently valuing the offer, but they did not disclose any further details or the time frame for the deal.

The investors plan to acquire all outstanding ordinary shares not owned by Zhaopin's controlling shareholder, Australian investment firm SEEK International Investments Pty Ltd which owns 68 percent of Zhaopin, for $17.50 in cash per American depositary share.

The price represents around a 22 percent premium to the company's closing at $14.35 per ADS on Jan 15, and values the company at $1.1 billion.

Officials did not give any information about whether it plans to relist on the A-share market.

Currently, it had approximately 322,000 unique employers and 105 million white-collar job seekers on its books.

Founded in 1997, Zhaopin was also one of the country's first recruiting websites.

It floated in June 2014, and is still the only Chinese job listing website listed in New York.

According to its latest earnings report, it has seen annual double-digit growth rates consecutively since going public.

Chief Executive Guo Sheng said earlier that its growth has been driven by expanding customer penetration, particularly among China's small and medium-sized companies, at a time of difficult domestic employment conditions and increased competition from career development portals.

The potential delisting would follow other Chinese companies exiting overseas stock markets.

Last year, the number of Chinese companies that received privatization offers exceeded the total number in the past 12 years.

A number of US-listed companies including Chinese leading Internet security company Qihoo 360 Technology Co Ltd and China's largest specialist in airport displays AirMedia Group Inc have now reached final privatization agreements with potential buyers.

FocusMedia Holding Ltd, which used to be China's largest overseas listed advertising firm, has already been privatized and has listed on the A-share market.

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Permalink 01:55:01 pm, by dacare, 145 words, 196 views   English (US)
Categories: News of China

Internet firm Meituan-Dianping raises $3.3b, valuing company at $18b

Chinese Internet company Meituan-Dianping announced on Tuesday that it has raised more than $3.3 billion in a funding round, valuing the company at $18 billion.

The deal is the largest single-round private financing in China's Internet industry up to date and the largest in the online-to-offline business section worldwide, according to Xinhua News Agency.

Leading investors include Tencent Holdings Ltd, Russian investment firm DST Global, and ChinTrust Bridge Partners.

Alibaba Group Holding Ltd, the original investor of Meituan, did not participate in the new round of financing.

Meituan-Dianping is the country's largest online-to-offline company, offering a wide range of services like group-buying, selling movie tickets and food delivery.

The company was formed in October when Tencent-backed Dianping and Alibaba-financed Meituan merged.

With 150 million monthly active users, it can handle 10 million orders every day. In 2015, its online transactions totaled 170 billion yuan ($26 billion), the company said in a statement.

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Permalink 10:09:22 am, by dacare, 109 words, 187 views   English (US)
Categories: News of China's finance arm gets $1 bln in financing

Chinese online retailer said on Saturday that its financial arm will get 6.65 billion yuan (around 1 billion U.S. dollars) in funding from a group of investors.

The NASDAQ-listed online retailer said Sequoia Capital China, China Harvest Investments and China Taiping Insurance are chief among a group investors funding JD Finance, which offers a broad range of financial services including consumer credits, loans, insurance and wealth management products since its launch in 2013.

The funding, set to complete in the first half this year, will value's financial subsidiary at 46.65 billion yuan. said it still holds the majority stakes in JD Finance after the funding completes.

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Permalink 10:02:29 pm, by dacare, 1095 words, 454 views   English (US)
Categories: News of China, Banking & Financial Services, Technical, IT Recruiting

China’s Haier to Buy GE Appliance Business for $5.4 Billion

Updated Jan. 15, 2016 5:17 a.m. ET


BEIJING— General Electric Co. agreed to sell its appliance unit for $5.4 billion to Chinese manufacturer Haier Group, which is looking to expand its products into homes around the world.

GE and Haier announced the deal Friday, saying the companies will cooperate world-wide to expand their reach in health care, advanced manufacturing and the industrial sectors.

The deal will help Haier sell refrigerators, washing machines and other appliances that are already popular in China overseas after years of struggling to gain a stronger foothold in the U.S. and elsewhere. Haier said it will have the rights to use the GE brand for appliances for 40 years.

The acquisition also enables GE to focus on its industrial business—jet engines and power turbines instead of washing machines and even finance.

“Haier has a good track record of acquisitions and of managing brands,” GE’s chairman and chief executive officer Jeff Immelt said in a news release. “Haier has a stated focus to grow in the U.S., build their manufacturing presence here, and to invest further in the business.”

Qingdao Haier Co., a Shanghai- listed company in which Haier owns 41%, will acquire the GE appliance unit, Haier said. It said the deal “establishes a model for cross-border investment and cooperation between China and the United States.”

The deal, which values GE Appliances at 10 times the last 12 months of earnings before interest, taxes, depreciation and amortization, according to GE, was reported earlier by The Wall Street Journal.

It marks the third major overseas acquisition by Chinese companies this week.


China’s Haier Nears Deal to Buy GE Appliance Business
A consortium of investors including China National Chemical Corp. on Sunday agreed to buy KraussMaffei Group for 925 million euros ($1 billion), one of the largest Chinese takeovers of a German company. Two days later, Chinese conglomerate Dalian Wanda Group Co. agreed to acquire production and finance company Legendary Entertainment for $3.5 billion in cash, the largest China-Hollywood deal to date.

GE has been running an auction for the century-old appliance business since it abandoned a $3.3 billion sale to Sweden’s Electrolux AB in December. The U.S. Justice Department had sued to block that transaction, saying the combination of the two companies would hurt competition for cooktops and ranges. Haier is unlikely to face the same antitrust hurdles as Electrolux because of its small presence in the U.S.

In seeking a fresh buyer, GE executives wanted “a better deal” than they had gotten from Electrolux, one person familiar with the matter said. GE also stands to receive a $175 million breakup fee from Electrolux.

The Chinese appliance maker outbid other foreign corporate bidders for the Louisville, Ky.-based business, according to a person close to the deal.

Haier has struggled to compete in the U.S. While it calls itself the biggest appliance maker in terms of unit sales, Haier is mainly known in the U.S. for niche products such as compact refrigerators and window air-conditioning units.

The privately held company has also been expanding its range of products and retail partners in the U.S. Last August, Haier said it would invest $72 million to expand its 15-year-old refrigerator plant in Camden, S.C.

The GE transaction, however, will vault the Chinese company past Electrolux and other rivals in the U.S. market for white goods, which is currently led by Whirlpool. Sales for the GE Appliances and Lighting division, of which appliances is the lion’s share, were $8.4 billion in 2014.

Haier held talks with GE in 2008 to buy the U.S. firm’s appliance unit. In 2010, a Haier executive said the company didn’t buy at the time because the price for the unit was too high. Haier also made an unsuccessful bid for Maytag Corp. in 2004, but lost out to Whirlpool.

Since then, Haier has been vying for more U.S. retail partners, tapping major advertising agencies in an effort to become a household name. Haier held a 29.8% market share of major household appliance sales in China last year, compared with 5.6% in the U.S., according to market research firm Euromonitor.

For Haier, which had $32.6 billion in revenue world-wide in 2014, growth overseas is critical. Profit margins from the company’s refrigerators and washing machines in China are razor-thin due to increased competition at home, where online shopping has sparked price wars, pushing down prices in the electronics and appliances sector.

Another drag on business is that fewer people in China are buying new homes and thus need fewer new appliances.

The deal will broaden Haier’s customer base and distribution channels. It will also sharpen its credibility in the U.S., where “Chinese brands are perceived as low quality,” said Klaus Meyer, a business professor at China Europe International Business School in Shanghai.

Based in China’s northeastern coastal city of Qingdao, Haier is one of China’s legacy state-owned enterprises. Haier’s chief executive, Zhang Ruimin, was the general manager when the company started in 1984 as a successor to a loss-making refrigerator factory that had been opened in 1949, when Chairman Mao Zedong founded modern China.

Mr. Zhang, now 67, has become somewhat of a legend in business circles back home, building a no-nonsense demeanor when he, as newly appointed chairman in 1985, grasped a sledgehammer, smashing a faulty refrigerator to demonstrate zero tolerance for shoddy products at the factory.

Within his first decade as chairman, he transformed Haier, creating China’s largest appliance maker and becoming the first businessman appointed to China’s Central Committee, one of the Communist Party’s highest decision-making bodies.

Mr. Zhang built the brand by investing in a cartoon in the 1990s called the “Haier Brothers,” creating mascots that generations in China came to recognize long after the airing of the more than 200 episodes. Today, Haier has become one of the China most valuable brands, worth $1.9 billion in 2015, according to media agencies Millward Brown and WPP, which calculated the value using the company’s financial data and consumer survey data.

GE Appliances will keep its headquarters in Louisville, Ky, the companies said.

Haier said in a statement to the Shanghai Stock Exchange if the deal ceases due to failure to obtain approvals from antitrust regulators, Chinese regulators or Qingdao Haier’s shareholders, Qingdao Haier will be required to pay $200 million to $400 million to GE as compensation.

GE’s assets Haier is acquiring had a book value of 1.84 billion dollars as of the end of 2014.

—Ted Mann in New York and Rose Yu in Shanghai contributed to this article.

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