Category: "News of China"
Career development main reason for job-hopping
January 22nd, 2014Career development and more room for personal growth are the primary reasons that Chinese change their jobs, global recruitment consultancy Robert Walters reported on Tuesday.
Eighty-one percent of the 400 Chinese respondents surveyed said they will change jobs in 2014. Of those, 47.1 percent said the reason was to seek more room for personal growth, while 20.2 percent of them sought promotions in new companies, according to the Robert Walters 2014 Global Salary Survey.
Salary increase, though not weighing as much now as in the past, is still a significant driver of job-hopping. People who stay in their current position can expect a salary increase of between 8 and 10 percent. But for those who change jobs, salaries can jump 15 to 25 percent.
Arthur Wang, managing director of Robert Walters China, said employers should help their employees to map out a clear career path. "If promises are not kept, employees will definitely leave the company," he said.
Lenovo said to be eyeing IBM’s server unit
January 22nd, 2014
China's Lenovo Group, the world's largest personal computer vendor by shipment, said Tuesday that the company was in preliminary talks about a potential acquisition, which some insiders said would be International Business Machines Corp (IBM)'s server division.
A filing posted on the Hong Kong Stock Exchange on Tuesday showed that Yang Yuanqing, Lenovo's chairman, refused to disclose detailed information of the third party as well as the deal.
"The company has not entered into any definitive agreement in relation to the potential acquisition," Yang said.
Unnamed sources familiar with this matter was quoted by Reuters as saying that Lenovo has restarted negotiations of purchasing IBM's low-end (X86) server business after the two failed to reach a deal in early 2013 due to their divergence on the cost.
According to media reports in May last year, IBM expects to offer the unit for sale for between $4 billion and $6 billion while Lenovo was only willing to put in $2.5 billion.
Lenovo refused to comment on the possible acquisition when reached by the Global Times on Tuesday. IBM did not reply to the Global Times' e-mail inquiry by press time.
In pursuit of high profits, IBM is very likely to sell its lower-end server operation at a satisfactory price, largely because this segment has become increasingly mature, leaving little room for robust growth, Cao Yujie, director of consultants for Beijing-based IT market research agency CCW Research, told the Global Times Tuesday.
According to Morgan Stanley's estimates as quoted by media reports Monday, IBM's X86 server unit generated around $4.9 billion of the total $15.4 billion in its overall server business in 2012.
Data from the US IT research firm Gartner released in December indicated that in the third quarter of 2013, worldwide X86 servers saw low levels of growth at 2.1 percent year-on-year in shipments, with revenue rising 4.4 percent. The whole server revenue declined 2.1 percent year-on-year in the third quarter.
Despite the low margin, an acquisition of a server business run by market veterans like IBM would significantly boost Lenovo's market share and enable it to stand out from domestic competitors as well as better compete with foreign peers, said Cao.
Lenovo bought IBM's Thinkpad PC unit in 2005 for $1.75 billion, which helped it leap to the top of the worldwide PC market.
In the fourth quarter of 2013, the company accounted for 18.1 percent of worldwide PC shipments, ranking first, according to Gartner.
The company has already dipped its toe into the server market in an attempt to diversify its product range beyond PCs.
In early January 2013, it set up a joint venture with the US computer storage service provider EMC Corp to further develop its X86 server business.
However, it does not perform well in this sector due to its lack of advanced technology and brand recognition, Zhang Yi, CEO of Shenzhen-based Internet research firm iiMedia Research, told the Global Times Tuesday.
According to Gartner, Lenovo ranked seventh with a market share of 2.3 percent by worldwide server shipments in the third quarter of 2013, while HP topped the rankings with 26.9 percent and IBM was in third with 7.9 percent.
Zhang believed that Lenovo could win more customers if the acquisition of IBM's low-end server unit can be finalized successfully.
But he was concerned that the deal may invite scrutiny from US authorities, as servers pose a more important security issue than PCs and handsets due to their being used by governments and enterprises for data storage and processing.
In October 2012, Huawei and ZTE, China's two leading telecommunications equipment makers, faced charges by a US congressional panel of posing a national security threat to the US.
ZTE aims to sell 60m smartphones in 2014
January 21st, 2014ZTE Corp, China's second-largest telecom equipment maker, said it aims to sell more than 60 million smartphones this year and to become the world's third-largest smartphone vendor by 2016.
Zeng Xuezhong, ZTE's executive vice-president, said the company sold more than 40 million smartphones last year and that it expects a significant increase in sales this year.
Zeng took the helm of ZTE's terminal business 20 days ago, after the Shenzhen-based company announced a major restructuring move.
"The Chinese market will likely become a global focus this year and will probably see the fastest growth rate among all the markets," Zeng said at a news briefing in Beijing on Monday.
He also said ZTE will launch affordable smartphones costing about 1,000 yuan ($165) per unit, in the Chinese market this year.
Demand for next-generation smartphones will surge in the near future, since Chinese telecom carriers are stepping up efforts to set up fourth-generation networks and offer 4G services, said Xiang Ligang, a Beijing-based telecom expert.
China Mobile Ltd - the world's largest telecom operator by subscriber base - plans to buy about 100 million 4G smartphones from all of its handset partners this year.
Meanwhile, even though Apple Inc recently signed a multiyear agreement with China Mobile to sell its iPhone devices in the Chinese carrier's stores, analysts said that Apple may only get a small share of China Mobile's business.
"Apple's iPhone handsets are too expensive for many Chinese customers," Xiang said.
Domestic mobile phone players, such as ZTE andLenovo Group Ltd, are more capable of attracting low to mid-end 4G phone buyers, which account for the most important part of the Chinese market.
Ni Fei, head of ZTE's Nubia smartphone unit, said in a recent interview with The Wall Street Journal that Apple surely will not eat all of China Mobile's 4G cake.
"There will be big pieces for major Chinese vendors like ZTE," Ni said.
ZTE launched the Nubia smartphone brand in 2012. The brand relies on online channels to distribute its products and targets high-end smartphone buyers.
Zeng said on Monday that ZTE fully supports Nubia's development and expects the brand to see much faster growth this year.
He added that because the majority of smartphone users are people under age 35, ZTE said its mobile team should be led by young managers.
"More young people, mostly from the post-1980s generation, will emerge in the high-level management space of ZTE's terminal sector," Zeng said.
In addition, the company will pay more attention to mobile phone design, user interfaces and applications, instead of merely focusing on good hardware, he added.
On Monday, ZTE also said its net profit in 2013 ranged between 1.2 billion yuan and 1.5 billion yuan, after it recorded a net loss of 2.84 billion yuan in 2012.
ZTE said stringent controls over low-margin contracts, improved margins for global projects and cost-control measures helped it to improve its performance.
First-tier cities draw capital into offices
January 17th, 2014First-tier cities, led by Beijing and Shanghai, remain preferred sites for office investment in China despite rather low net yields, CBRE concluded after tracking 15 major Chinese cities.
Boasting stable returns with a low level of risk, underpinned by a well-developed market and resilient demand from foreign and domestic clients, first-tier cities rank higher in CBRE's MarketScore system, a strategic framework to evaluate real estate investment potential according to their risks and returns.
The key challenge for most first-tier cities, however, is aggressive pricing as net yields for office investments in these cities range from 4 percent to 5 percent.
"As economic and social development varies significantly across different Chinese cities, it can be challenging for investors to choose where to invest and where to buy," said Frank Chen, executive director and head of CBRE Research China. "The scoring exercise aims to identify the most attractive real estate market from an investor perspective, based on fundamental drivers."
Beijing topped the MarketScore ranking due to its strong historical rental performance, low vacancy rate and limited future supply.
Shanghai was second due to a strong net take-up and the highest investment liquidity.
Wuhan was third although abundant future supply will curb rental growth in the near term, CBRE said.
Sanofi to expand into small cities
January 16th, 2014French drug maker Sanofi will expand into small cities to meet the growing market demand for health products, the company's top management said on Thursday.
According to Fabrice Baschiera, general manager of commercial operations of Sanofi Greater China, demand for high-quality health care products and services is growing.
"So, we decided to go out from those big cities to counties to reach more patients, bring our know-how with physicians through training and the latest training materials — especially in the cardiovascular and diabetes areas, the areas where Sanofi has already built up a strong foundation and knowledge, where we can make a real difference and have the most impact," Baschiera said.
The company, together with the Medical Services Standard Specialized Committee of the Ministry of Health, National Institute of Hospital Administration and Chinese Medical Doctor Association, launched the Basic Medical Standard Enhancement Project to offer more medical services to customers in towns and counties.
Huawei's revenue set to rise 10 pct annually over 5 years
January 16th, 2014Huawei Technologies expects revenue to grow 10 percent annually over the next five years as it taps the booming consumer, enterprise and software business as well as reap the benefits of its huge investment in research and development.
Its revenue in 2013 may hit 238-240 billion yuan (US$39.4-39.7 billion), a year-on-year growth of 8-9 percent, the Shenzhen-based company said yesterday.
Profit may reach 28.6-29.4 billion yuan last year, up 40 percent from the previous year, Chief Financial Officer Cathy Meng said in Beijing.
All the financial figures were unaudited.
Meng also predicted a 10 percent annual rise in Huawei's revenue over the next five years.
The country's No. 1 telecommunication equipment maker invested 33 billion yuan in research and development in 2013, up 9.6 percent from a year earlier.
It plans to invest US$600 million on 5G technology by 2016, according to Meng.
Huawei said in October that it planned to invest US$2 billion in Britain within five years.
In the global telecom equipment market, Huawei ranks second after Ericsson.
WB projects global economy to grow 3.2 pct in 2014
January 15th, 2014The global economy is estimated to expand at 3.2 percent this year from 2.4 percent in 2013, with growth picking up in developing countries and high-income economies, the World Bank said Tuesday.
But growth prospects remain vulnerable to U.S.tapering, the global lender said in its semi-annual Global Economic Prospects report.
The firming of growth in developing countries is being bolstered by an acceleration in high-income countries and continued strong growth in China, it said.
However, global growth outlook will be sensitive to headwinds from rising global interest rates and potential volatility in capital flows, as the U.S. Federal Reserve begins withdrawing its massive monetary stimulus, the report noted.
Growth in developing countries will pick up from 4.8 percent in 2013 to a slower-than-expected 5.3 percent this year, reflecting a cooling off of the unsustainable turbo-charged pre-crisis growth.
For high-income economies, the drag on growth from fiscal consolidation and policy uncertainty will ease, helping to boost economic growth from 1.3 percent in 2013 to 2.2 percent this year.
Among them, the recovery is most advanced in the United States, as it is projected to grow by 2.8 percent this year after expanding for ten quarters.
The Euro Area, after two years of contraction, is projected to grow by 1.1 percent this year board.
Expats in top demand for Chinese state-owned enterprises
January 13th, 2014There has been a significant increase in the demand for foreign professionals to represent Chinese state-owned enterprises abroad as the nation gears up its global commercial activities and plans listings of its domestic companies on international bourses.
Robert Parkinson, founder and CEO of RMG Selection, an international recruitment firm with offices in the China, says that the job market started picking up in the second half of 2013, and ended the year with strong indications of good hiring activity continuing into 2014 on the back of growing optimism and confidence. One the areas that is seen robust recruiting is for foreigners who can represent Chinese interests abroad, and have specific knowledge of capital markets and listings regimes.
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RMG recently published the results of a survey of the China job market, done in conjunction with academics from the University of Nottingham. The research report, 2013 China Talent-flow Survey Report 2, tracked several trends such as the rate of ‘job-hopping’ in various industries, including financial services and professional services.
Of the 4,000 participants in the survey, more than a quarter had changed jobs in the previous 12 months compared to about a fifth in the previous survey period (end 2012/early 2013). Parkinson says candidates demand – and get – increases varying from 20% to 50% each time they move.
Most of the ‘job-hopping’ activity was concentrated among candidates who earned 50,000 RMB (over US$8,000 per month), while the age demographic most likely to change jobs was the so-called “millennials” – candidates born in the early 1990s – with 43% reporting they had changed employer in 2013.
“Many Chinese graduates will take pretty much any job they can find because the job market is so competitive. But once they have settled, and a better offer comes along, they will move quickly.”
RMG is seeing a flood of ethnic Chinese to China – either nationals who have worked abroad moving home, or people with Chinese ancestry and family connections wanting to seek opportunities in what Parkinson described as a very ‘hot’ market.
But Chinese companies were also seeking out foreigners who could represent their interests abroad – especially people with a strong understanding of and experience in international capital markets – skills that many Chinese nationals currently lack due to the country’s historically closed economy.
But for expats, finding a job in China and even looking for another role when already working in the country is challenging. Many channels available to finance professionals in other parts of the world, such as company recruitment portals, job boards, newspaper listings, and internet sites are practically non-existent.
One of the reasons, says Parkinson, is cultural. “Candidates, especially senior people, regard it as beneath them to look for jobs – they expect employers and headhunters to come to them.”
This supports one of the key findings for the research: that using headhunters is still the preferred channel for Chinese companies to find candidates. In the recent survey, the researchers found that the percentage of Chinese companies using headhunters had increased from 35% to 57% in the past year.
Lenovo challenges Apple, Samsung
January 10th, 2014
Yang Yuanqing was never afraid of declaring war on the strongest enemies.
After beating Hewlett-Packard Co to take the No 1 position in the global personal computer industry, Yang, the chairman and CEO of Lenovo Group Ltd, can't wait to challenge Apple Inc and Samsung Electronics Co Ltd.
"Traditional PC vendors are no longer our top rivals nowadays," said the engineer-turned-executive. "Our next step is to challenge Apple and Samsung in the portable consumer electronics sector."
Over the past five years, Lenovo eroded other PC manufacturers' market share bit by bit, reaching the top position in China first and then in the rest of the world. Yang is determined to copy this strategy on a new battleground.
The biggest campaigns Lenovo launched in 2013 were for its smartphone and tablet series.
The Beijing-based company invited basketball sensation Kobe Bryant and Hollywood star Ashton Kutcher to endorse its high-end smartphone and tablet products in a bid to lure young Chinese buyers.
The company came out with most of its flagship gadgets just before Apple unveiled its iPhone 5S and iPad Air devices.
Lenovo has sold 1 million Yoga-branded tablets since the product's launch in October, according to Yang, who also plans to bring Lenovo's consumer electronics to developed markets such as the United Kingdom and the United States.
The company sees the smartphone market as a stepping stone to enter other mobile consumer electronics markets because of its popularity in both emerging and developed markets.
According to a Gartner report, Lenovo was the world's third-largest smartphone manufacturer in terms of market share as of the third quarter of 2013.
The company sold nearly 13 million smartphones around the world, taking more than 5 percent of global market share.
Yet the Chinese company still lags far behind Apple and Samsung in terms of shipments.
Asia-Pacific markets are poised to post huge increases in smartphone sales as more buyers abandon feature phones for lower-end smartphones.
"Consumers in China and Latin America are rushing to replace their old models with smartphones," said Anshul Gupta, principal research analyst at Gartner.
About 48 percent of Chinese mobile phone owners will use a smartphone by the end of 2014, Forrester Research Inc estimated. The figure is expected to increase to 64 percent by 2017.
In China, Lenovo is the second-largest vendor after Samsung, according to local research firm Analysys International.
Among the 93 million smartphones sold in the third quarter, Lenovo controlled 11.4 percent of market share, while Samsung had 18.1 percent.
Liu Jun, vice-president of Lenovo, said the company is eyeing an even bigger market share outside China.
Lenovo sees the rise of emerging markets as a golden opportunity for its business in the post-PC era. It's quickly expanding operations in Southeast Asian nations including Malaysia, Indonesia and Singapore.
Antonio Wang, associate director at industry consultancy IDC China, said that Lenovo's advances were mostly made via overseas M&A deals at the beginning of 2013.
"The company was able to use its own research and successful marketing strategy in the mobile devices sector to create huge profits later on," Wang said.
Yang, Lenovo's CEO, recently announced the opening of a brand-new assembly plant in Wuhan, Hubei province.
Located in the southeast part of the city, the factory is the world's largest manufacturing facility for Lenovo and a hub for the company's mobile product line, Yang said.
It will build more than 30 million smartphones and tablets in 2014, representing 40 percent of the company's total output in the mobile sector.
The plant will also recruit another 4,000 employees this year and will ship out more than 100 million mobile devices once put into full operation.
"We will largely rely on our own plants to feed global demand for mobile devices," said Liu, Lenovo's vice-president.
Unlike Apple, which outsources its production, Lenovo makes nearly 70 percent of its mobile devices itself.
"The company plans to turn the Wuhan plant into the world's largest facility for developing, testing and manufacturing mobile devices," Liu said.
Johnson & Johnson trademark revoked in China
January 9th, 2014China's top industry and commerce watchdog recently ruled that the trademark "OneTouch" for a line of blood glucose meters and test strips produced by LifeScan, a Johnson & Johnson company, violates Chinese trademark laws, and should be revoked.
According to Chinese laws, if Johnson & Johnson doesn't file a lawsuit against the ruling in 30 days, or if a verdict isn't reached within 60 days after the ruling was made, the Trademark Appeal Board of China's State Administration for Industry and Commerce has the right to remove all of the company's OneTouch products from the market.
Public security authorities can also confiscate the company's illegal income from the product line in the past years, said Huang Yunzhong, an attorney from Beijing Peiwen Law Firm.
Huang is also the legal counsel of Guilin Zhonghui Biotechnology Co in the Guangxi Zhuang autonomous region, which has been under criminal investigation since 2007 for allegedly producing counterfeits of Johnson & Johnson's OneTouch blood glucose test strips used by patients with diabetes.
In 2005, Johnson & Johnson recalled its OneTouch glucose meters, because instead of providing a warning, the meter turned itself off when it read a dangerous blood glucose level of 1024 mg/dL or above.
But later in 2006, Johnson & Johnson announced that it found a large amount of counterfeit blood glucose test strips from Zhonghui in China, which caused previous machine failures in its blood glucose meters.
Huang Yunzhong, the attorney, filed the dispute on the "OneTouch" trademark to the Trademark Appeal Board in late 2011, and the board reached the decision to revoke the trademark on Dec 27, 2013.
The recent ruling said "one touch" falls into a category of medical subject headings, so "OneTouch" cannot be trademarked.
Huang believes the ruling would bring about a favorable investigation result for Zhonghui on the accusations the company was making counterfeits.
Johnson & Johnson told China Daily it would comment on the ruling when the company had prepared a response.
BEA and DBS open FTZ outlets
January 8th, 2014Bank of East Asia and DBS Bank were the first among overseas lenders that officially opened their sub-branches in the Shanghai free trade zone yesterday, as they were attracted by potential opportunities in China's latest financial reform test bed.
In addition, at least six foreign banks have received the nod from the China Banking Regulatory Commission to prepare for a new outlet in the FTZ. They include Citi, HSBC, Hang Seng Bank, Deutsche Bank, United Overseas Bank and ANZ. The FTZ will allow overseas banks to introduce new services and expand more rapidly in the country, said Geoffrey Choi, assurance leader of financial services at Ernst & Young for China.
Apple opens new online store on tmall.com site
January 8th, 2014Apple, the maker of iPhones and iPads, opened an online store Tuesday on tmall.com, China's largest business-to-consumer online marketplace.
The store on Tmall was launched by Apple on Tuesday, providing an online selling platform in addition to the company's online store, a customer service staffer with the online store said Tuesday.
The layout looks similar to Apple's official online store for China, except for the logos and additional information of Tmall.
The price tags for Apple products on the Tmall store are exactly the same as those on Apple's online store. It remains unknown whether special discounts will be offered on days such as November 11, known as Singles' Day in China - similar to the Black Friday shopping bonanza in the US, according to the customer service staff member.
There has been no official announcement from Apple, and the Global Times could not reach Apple for comment by press time on Tuesday.
Yan Qiao, Tmall's PR director, confirmed to the Global Times on Tuesday about the launch of the Tmall store by Apple.
The move came a few days after Apple unveiled its long-rumored deal with China Mobile, the world's largest telecom operator by subscribers, which analysts believe will serve to prop up Apple's market share in the country, where the US mobile gadget maker was losing ground to not only its nearest rival Samsung, but also an array of cheaper Chinese brands.
"With the Tmall store, Apple is set to embrace a broader customer base, as top online marketplaces have picked up steam in the country as an alternative to brick-and-mortar outlets," Wang Jun, an industry analyst with Beijing-based Analysys International, told the Global Times Tuesday.
Handsets sold online in the market are estimated to represent 11 percent of the total in 2013, according to sales monitoring data from market research firm GfK China.
But Wang noted "the new store is unlikely to give a big impetus to Apple's sales in the market."
Only revolutionary new products from the company are likely to ignite the flame of consumers' buying passion, he commented.
Mengniu agrees nutrition products tie-up with US firm
January 7th, 2014China Mengniu Dairy Co Monday announced that it has signed an agreement with leading US consumer food and beverage company WhiteWave Foods Co to jointly expand into the Chinese nutrition market.
In order to produce and sell nutrition products in China, a joint venture will be set up with the Chinese dairy producer holding a 51 percent stake and 49 percent to be held by WhiteWave, according to a statement filed by Mengniu on Hong Kong Stock Exchange on Monday. The venture formation is expected to obtain approval from Chinese authorities in the first half of this year.
Meanwhile, the venture has agreed to offer 376.7 million yuan ($62.2 million) to purchase Chinese infant formula maker Yashili's nutrition plant, which is still under construction currently in Zhengzhou, Central China's Henan Province, said the statement.
Mengniu is Yashili's majority owner.
Mengniu has to diversify its product range, as the company's core business - liquid milk - does not have much room for growth amid fierce competition from imported brands, Chen Lianfang, an analyst from Beijing Orient Agribusiness Consultant Ltd, told the Global Times Monday.
"China has seen a fast annual growth rate of more than 100 percent in imported liquid milk amounts in the past two years, as domestic consumers tend to prefer foreign dairy brands in the wake of the powdered milk scandal in 2008," Chen said.
The latest financial information about Mengniu's operation is not available to the public on the company website, but its mid-term financial results ending June 30, 2013 showed that the company gained 20.7 billion yuan, while its major rival Yili raked in more money over the same period, totaling 24 billion yuan.
According to the two companies' mid-term financial reports, the sales of liquid milk products contributed to 88.3 percent of Mengniu's overall revenues, with the rest mainly coming from ice cream.
Yili got about 75 percent of its revenue from liquid milk, but also makes money from products such as ice cream, milk powder and mixed animal feeds.
Mengniu also has been in the domestic milk powder market since 2006, but the company does not have a fairly satisfactory performance in this segment, resulting in its embrace of the country's nutrition market this time, Yan Qiang, a researcher from Beijing-based Hejun Consulting, told the Global Times Monday.
An April report by Shenzhen-based market research firm China Competition Information stated that sales in the domestic nutrition industry reached 113 billion yuan in 2012, 32 percent growth year-on-year, forecasting the amount will surpass 430 billion yuan in 2018.
As China's aging population is getting larger and the central government will implement the new second-child policy announced last November around the country in the near future, the demands for high-quality, especially foreign-branded or -invested, nutrition products will spike, said Yan.
Gregg Engles, CEO of WhiteWave, also sensed the potential boom in China's nutrition market, as he expects that the tie-up with Mengniu could help his company access China, a promising market "with a rapidly growing, multi-billion dollar nutritious products segment," according to a press release issued Sunday.
Mengniu could benefit a lot from the cooperation with WhiteWave in terms of technology as well as establishing its brand in the nutrition sector, Yan noted.
WhiteWave sells various goods such as plant-based foods and beverage as well as dairy products throughout North America and Europe.
However, Chen held a wait-and-see attitude toward the prospect of Mengniu's nutrition operation, as the sector in China is faced with loose regulations and fairly chaotic competition.
"Mengniu, widely known as a liquid milk giant, will have to spend a fairly long time and lots of vigor in gaining consumers' trust in the nutrition market," Chen said.
Time for Xiaomi to end hunger game
January 6th, 2014Last week, Xiaomi Inc revealed its major achievements for the past year. In 2013, the tech up-and-comer sold 18.7 million handsets, up 160 percent year-on-year and well above the 15 million unit production target it set at the beginning of last year.
Based on its recent successes, Xiaomi founder Lei Jun promised to turn out 40 million handsets in 2014.
Enhancing productivity is now a top priority for Xiaomi, according to internal e-mails which also state that the company can't keep up with demand.
Xiaomi appears to be breaking away from the starvation marketing strategy it has employed so skillfully to build a name for itself over the past three years. At this juncture, this is a wise move for the company.
In the beginning, Xiaomi could have made a convincing case that its limited output was the natural result of its limited production capacity. But now that Xiaomi has earned billions and is one of China's largest tech brands, such a lame argument would only hurt the company's reputation.
Moreover, scarcity is no longer a useful tool now that the market is overflowing with inexpensive, feature-packed smartphones.
Pudong Development Bank earns $6.7b in 2013
January 6th, 2014Shanghai Pudong Development Bank's net profit jumped 19.8 percent year on year to nearly 41 billion yuan ($6.7 billion) in 2013, according to a filing to the Shanghai Stock Exchange late Friday.
The financial institution is the first listed commercial bank in China to disclose its 2013 results, Shanghai Securities News reported on Saturday.
Earnings per share stood at 2.195 yuan, up 19.8 percent from a year ago, according to the statement. Operating revenue stood at just over 100 billion yuan, up 20.61 percent year on year.
The lender's total assets reached 3.68 trillion yuan, up 17 percent from a year earlier. Its total liabilities stood at 3.47 trillion yuan, up 17.1 percent from a year ago.
The lender's non-performing loans ratio was at 0.74 percent, 0.16 percentage points higher than that at the end of 2012.
Its outstanding deposits totaled 2.42 trillion yuan by the end of 2013, up 13.41 percent from a year earlier. Outstanding loans reached 1.77 trillion yuan, up 14.37 percent from the end of 2012.
Tsingtao Brewery accelerates expansion
January 3rd, 2014Tsingtao Brewery acquired a local beer producer in North China's Hebei province, and launched a joint venture with another in Shijiazhuang, wrapping up a storm of expansion in 2013.
In a press release, Tsingtao said it would acquire Xinzhonglou, a 64-year-old brewery in Zhangjiakou on Dec 29.
Huang Kexing, president of Tsingtao, said the company will integrate and reengineer Xinzhonglou's branding and distribution network. In addition Tsingtao will work with Xinzhonglou to invest 400 million yuan ($65.57 million) in a new brewery with an annual production capacity of 600,000 kiloliters.
Earlier, on Dec 16, Tsingtao entered a joint venture with Jiahe Brewery in Shijiazhuang to integrate Jiahe's marketing network and seek mutual success. Tsingtao and Jiahe will each have a 50 percent interest in the joint venture.
The two projects will enable Tsingtao to enhance its competitiveness in North China by connecting its network across the northern and southern parts of Hebei province and increasing its exposure in neighboring Shanxi province and the Inner Mongolia autonomous region.
Huang said the company now puts more focus on the market network and is striving to ensure continued quality growth and innovation.
"Only with market expansion can we build more factories to expand production capacity," he said. "As we uphold the principle of rational investment and value investment, the company's strategic expansion has been yielding delightful market performance."
In March, Tsingtao broke ground for a new brewery with a capacity of 600,000 kiloliters in Luoyang, in Central China's Henan province. It began operations in December.
A 400,000 kiloliter brewery started in August in Jiujiang, Jiangxi province. Three relocation projects in Suqian, Wuwei, and Harbin were also completed before the end of 2013. Its breweries in Qingdao and Jinan have increased production capacity to meet strong market growth.
China's beer industry slowed in the past two years. According to the National Bureau of Statistics, China produced 24.98 million kiloliters of beer in the first half of 2013, a 5.85 percent increase from the same period last year. The growth from January to June 2012 was 4.85 percent while the same period in 2011 saw growth in beer production of 11.4 percent.
Despite the countrywide slowdown, Tsingtao's yield hit 7.53 million kiloliters from January to September 2013, up 11 percent from the same period in 2012. Net profits jumped 28.7 percent in the first three quarters from last year.
Tsingtao's stock price at A shares and H shares also hit record highs, according to the company's Q3 financial report for 2013.
Alibaba's 'Leftover Treasure' hits 43 mln users
January 2nd, 2014Yu'ebao (Leftover Treasure). an Alibaba personal finance product, had 43.03 million users with aggregate deposits of 185.3 billion yuan (30.4 billion U.S. dollars) at the end of 2013.
Yu'ebao is an online fund established by Alipay, China's largest third-party payment platform and subsidiary of Alibaba, part of China's biggest online shopping mall, togetheer with the private Tianhong Fund.
"Investments" in the fund have brought 1.79 billion yuan in profits to users since its launch in June 13 this year, according Alipay on Wednesday.
Yu'erbao allows Alipay customers to invest any balance in thier accounts with the Tianhong Fund and has already become the largest fund of its kind in China.
Its users come from all over China: more than 2,000 counties and cities in 31 provincial-level administrative regions with an average deposit of 4,307 yuan per user.
Philips opens lighting center in Chengdu
December 31st, 2013Philips has officially opened its center for the development and production of advanced lighting technologies in Chengdu, providing it with a second regional base of operations in China.
The Philips LED Lighting Demonstration Park was opened in the Chengdu Hi-Tech Development Zone in the Sichuan provincial capital city, with the formal opening ceremony taking place on Dec 20.
Covering an area of about 40,000 square meters and with an investment of about $34 million, the park includes a manufacturing center for LED lights and a lighting application center.
The manufacturing center will mostly produce professional outdoor and indoor lights and be focused on providing local and global customers with highly customized lighting solutions.
The lighting application center covers 7,000 square meters and boasts Philips' most advanced lighting technologies and solutions.
It is modeled on "a mini smart city", exhibiting the effects of lighting through real-life scenarios, both outdoor and indoor. It recreates urban environments such as the home, office, hotel, supermarket, clothing store, street and urban landscape.
All lighting systems in the center can be smartly controlled and managed with an advanced lighting control system, with the aim of simultaneously achieving optimal visual effects and energy efficiency.
"The park reflects our commitment to Chengdu as the second regional headquarters of Philips in China. It is also a part of the execution of our 'home market' strategy — establishing China as one of the key innovation and operation hubs for Philips' global value creation," said Patrick Kung, CEO of Philips Greater China, at the opening ceremony.
In June 2011, Philips signed a memorandum of understanding for strategic cooperation with the Chengdu Hi-Tech Development Zone management committee, agreeing the establishment of the company's second regional headquarters in Chengdu.
The company's aim was partly to extend its operations further into central and western China, part of a plan to implement a localization strategy in China, including the deployment of talent and the creation of marketing channels.
In 2011, when the deal was signed, Yuan Zongyong, deputy director of the Chengdu High-Tech Development Zone's management committee, praised the decision to establish an operations center in Chengdu.
"Against the backdrop of China's Go-West Strategy and global industrial restructuring, the Chengdu High-Tech Development Zone is attracting increasingly more internationally famous companies with its advantage in technology, skilled workers, its regional position, market, transportation and costs," Yuan said.
Philips, which has its international headquarters in the Netherlands, opened its first regional headquarters in China in Hong Kong, but later moved operations to Shanghai.
Shenzhen to Hike Minimum Wage Levels
December 31st, 2013Shenzhen human resource officials announced last week that the city will raise its monthly minimum wage level by 13 percent to RMB1,808 from February 1, 2014, while its hourly minimum wage will be adjusted from RMB14.5 to RMB16.5.
The new minimum wage standards are expected to benefit about 936,000 workers in Shenzhen, according to the city’s human resources and social security bureau.
In China, local governments are required to raise their minimum wage levels at least once every two years as a matter of State policy. Shenzhen last updated its minimum wage levels in March 2013, raising the monthly minimum pay by RMB100 to RMB1,600.
In 2013, twenty-seven regions in China have adjusted their minimum wage levels including: Shenzhen, Shanghai, Guangdong, Xinjiang, Tianjin, Jiangsu, Zhejiang, Beijing, Shandong, Fujian, Jilin, Liaoning, Hubei, Ningxia, Shanxi, Yunan, Anhui, Henan, Jiangxi, Guangxi, Gansu, Sichuan, Shaanxi and Guizhou. Detailed information can be found in the chart below.
After the latest round of adjustments come into effect, Shenzhen will have the highest minimum wage in the country at RMB1,808, followed by Shanghai at RMB1,620. Shenzhen will also have the nation’s highest hourly wage rate at RMB16.5, followed by Beijing and Xinjiang at RMB 15.2.
The country’s Employment Promotion Plan provides that the minimum wage levels in China should grow by at least 13 percent annually through 2015, and the minimum wage levels in most areas should not be lower than 40 percent of the average local salary. Under such policies, minimum wage levels across the country have registered an average 12.6 percent annual growth rate from 2008-2012.
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EMS withdraws IPO application
December 30th, 2013China Postal Express and Logistics Co Ltd, China's largest integrated express and logistics service provider by geographic coverage, also known as EMS, announced on Friday that it has withdrawn its IPO application.
To enhance competitiveness facing dramatic changes in the express delivery market, the firm has decided to fine-tune its original parent and subsidiaries structure to a more effective headquarters and branches management model, the firm said on Friday in a statement. The statement also said that the restructure might affect the firm's IPO process.
Founded in June 2010, EMS had filed an IPO application August 2011 and gotten approval from the China Securities Regulatory Commission in May 2012. But it did not get listed upon approval due to a sluggish equity market in 2012. EMS might try to enter the capital market after the restructuring is done, it said.
Pilot e-commerce platform launched
December 30th, 2013The country's first pilot cross-border e-commerce platform was launched in the China Shanghai (Pilot) Free Trade Zone (FTZ) Saturday, a move that will make it more convenient for consu-mers from the Chinese mainland to purchase products overseas.
Five types of goods - bags, fashion accessories, skin care and cosmetic products, food and beverages, and maternal and children's products - are already on sale on the online platform, which is called kuajingtong.com.
The operator of the platform, Shanghai Kuajingtong International Co, has already signed agreements with companies from the payment, logistics and retail sectors, and is negotia-ting -coo-peration deals with around 30 -global e-commerce websites including eBay and Amazon, Shanghai Morning Post reported Sunday.
Since the demand for products imported from overseas by Chinese consumers has been growing fast in recent years, the pilot cross-border e-commerce website "will have a bright future if its operator can offer pro-ducts with high quality and reasonable prices, as well as convenient services," Zhang Yi, CEO of Shenzhen-based Internet research firm iiMedia Research, told the Global Times Sunday.
Currently in China, consumers have limited ways to buy products overseas via the Internet. Some of them buy products directly from eBay and Amazon and then pay a third-party express delivery enterprise for transportation of the goods, a method that can sometimes allow them to evade customs duties.
Other consumers purchase pro-ducts overseas via individual vendors on e-commerce platforms such as taobao.com. But many consumers have complained that the products they bought from the individual vendors are fake.
"Kuajingtong.com will have many business opportunities as the demand is huge," Zhang said.
But Zhang also noted that it will take at least one to two years for kuajingtong.com to grab a large market share.
Chinese consumers said they will hold a wait-and-see attitude toward the new platform.
"The types of products on kuajingtong.com are limited so far. I will wait until there are more choices," Xia Tian, a 30-year-old white-collar worker in Beijing who has a one-year-old daughter, told the Global Times Sunday.
Xia has bought maternal and -children's products via websites such as amazon.com and paid third-party express delivery companies for transportation. "This type of purchasing model is already very common among young mothers," Xia noted.
"I still prefer to buy goods via vendors on taobao.com, from whom I have purchased products for two years," Wang Yujing, a 26-year-old white-collar worker in Beijing, told the Global Times Sunday.
Wang said the luxury bags and clothes she buys are 40 to 50 percent cheaper than those sold in domestic shopping malls, mainly because they are tax-free.
Consumers will have to pay tax if they buy products via kuajingtong.com.
But Yan Jing, executive vice-president of Shanghai Kuajingtong International Co, was quoted by Xinhua News Agency as saying Sunday that "the prices for international brands sold at kuajingtong.com will still be 30 percent lower compared with those sold in domestic offline stores."
"Although the consumers have to pay duties via kuajingtong.com, their purchasing activities will be legal," Yan noted.
A recent trial involving a former air stewardess who smuggled in products and re-sold them to Chinese consumers via taobao.com has raised discussions about the legality of cross-border purchasing.
The Beijing No.2 Intermediate People's Court found the former air stewardess guilty last month and sentenced her to three years in jail for smuggling.
Shanghai starts simulated trade in equity options
December 27th, 2013The Shanghai Stock Exchange has started simulated trading in equity options, part of a drive by regulators to expand investors' risk-hedging options.
Simulated trading began on Thursday morning, the SSE confirmed to China Daily, and more than 60 securities firms took part.
The shares of Ping An Insurance Group Co of China Ltd, SAIC Motor Corp Ltd, the China 50 ETF and the Shanghai SSE180 ETF were used in the exercise.
The exchange-traded funds track the top 50 and top 180 yuan-denominated stocks on the SSE.
In early December, SSE Chairman Gui Minjie told a forum that preparations "are almost complete" for launching options on individual stocks.
Single-stock options are essentially equity derivatives, giving buyers the right - but not the obligation - to buy or sell a stock at a fixed price within a certain period or on a set date, said Tony Sun, a strategist with Shanghai Tebon Fund.
The options "will allow investors to hedge their positions more effectively. We have limited financial instruments now, but as reform continues and China's financial markets become more global, innovation is a necessity," said Sun.
China introduced equity index futures in 2008, and those instruments remain the only equity derivatives in use. The regulators expanded a pilot program in August 2012 to boost margin trading.
In February, a new pilot was launched to enable securities lending and short-selling of blue chip stocks.
"Individual stock options can be seen as a form of insurance that reduces trading risks. However, options trading prices can be very volatile. Investors still have to be aware of the risks caused by leveraging and volatility," said Xiong Jinqiu, an independent financial commentator.
The China Securities Journal reported earlier this month that the SSE may officially introduce formal equity options trading in April. Some analysts believe the move is meant to stimulate investment in China's blue chips, which have been trading at depressed valuations.
The average price-earnings ratio for the SSE, where most of China's blue chip companies are listed, stands at only 11 times 2012 earnings. On the Shenzhen exchange, which is dominated by small-cap companies, the average ratio is 28.
Change for WMPs
Another development involving the liberalization of the financial markets took place on Wednesday, this one involving wealth management products.
WMPs will be allowed to invest directly in fixed-income products on domestic securities markets, the China Securities Depository and Clearing Corp announced.
The notice said that WMPs will be allowed to open accounts at the Shanghai or Shenzhen stock exchanges. Investment will be confined to fixed-income products, including exchange bonds, credit-backed securities and preferred shares. The latter are often classified as fixed-income products because of their fixed dividend.
Analysts said that the move on WMPs is intended to provide a bridge "linking" interbank market liquidity with the nation's stock exchanges, even though WMPs can't make direct stock investments at this stage.
The outstanding balance of WMPs stood at 9.92 trillion yuan ($1.63 trillion) as of Sept 30, the China Banking Association said earlier this month.
The figure has more than doubled since the end of 2011, and it's up from 7.1 trillion yuan at the end of 2012.
ZHAOPIN.COM BEST EMPLOYER SURVEY: CHINESE COLLEGE GRADUATES FIND BEIJING, SHANGHAI AND GUANGZHOU LESS APPEALING THAN BEFORE
December 25th, 2013Zhaopin.com Announces China’s Top 10 Most Popular Employers for Graduates. (PRNewsFoto/Zhaopin.com)
BEIJING, Dec. 13, 2013 /Emag.co.uk/ — The Zhaopin.com China Best Employer Award 2013 (best.zhaopin.com), co-organized by Zhaopin.com, China’s largest recruitment site, and Peking University’s Corporate Social Responsibility and Employer Brand Communication Research Center, successfully came to a conclusion in Sanya, Hainan province’s capital, also known as China’s Deer City. Zhaopin.com CEO Evan Guo said in his speech at this “Academy Awards” of China’s human resource industry, that he believes that 2014, with the number of graduates spilling out of China’s colleges and universities during the year expected to reach 7.27 million, will be an even more difficult year for job seekers than 2013, a year that had already been considered the most difficult year for employment so far.
(Photo: During 2013, Zhaopin.com joined hands with CCTV in organizing a public-benefit event, Graduates Seeking Employment 2013, with the aim of building China’s largest public platform for the job prospects of university graduates and with the goal of improving social awareness of the plight of college students, in the hope of helping more graduates find suitable positions. “Although the event was purely for the public good, during it we were rewarded for our faith and accomplished the lofty mission of helping thousands of graduates step into society,” Guo said. In the summer of 2013, the “Graduates Seeking Employment” platform ran announcements for 117,389 jobs seeking Chinese college graduates, and one in 100 graduates on average found a job via the platform. In 2014, Zhaopin.com looks forward to working with more companies to offer jobs in an even more difficult employment environment, and expects China Best Employers to play a leading role in the effort.
In China, college students are known as the “favored.” They not only shoulder the hope of the nation, but also are of extraordinary importance to the country’s human resources sector. Today, as China’s HR market shifts to a seller’s market and the population ages, the group of college graduates mainly consisting of the post-90s becomes the vital workforce. Compared to the post-70s and the post-80s, the post-90s generation brings a different perspective to the best employers, and these perspectives will provide important reference points for leveraging the experience of these employers in building leading brands. These factors were the key data points in determining the winner of Zhaopin.com’s China Best Employer Award 2013.
The Zhaopin.com “China Best Employer” report showed that Chinese undergraduates now no longer consider the salary and benefits package as one of the primary factors when looking at all the data points in a prospective employer’s profile. The survey data revealed that “Organizational Management” with 20.6 percent of votes overtook “Salary and Benefits Package” for the first time as the top criterion. This demonstrated that under the growing pressure from the increasingly competitive job market, the undergraduates considered self-improvement as a priority rather than exclusively focusing on material conditions, in a move to be more competitive in the future job market. These findings sound a warning to any employer who is still consider offering competitive salary and benefits packages as the solution to attract top talent rather than improving the quality of their organization.
The report also signaled that there were significant changes in what different types of companies considered their priorities, with one of the obvious trends being that young undergraduates are trying to compete based on their family background. According to the 2013 survey findings, state-owned enterprises (SOEs) are falling in attractiveness, with the number of undergraduates willing to work at an SOE declining by over 8 percent from the 2012 results, although undergraduates are more willing to work in state-owned and foreign-funded companies. Foreign-funded companies are becoming more popular among Chinese undergraduates.
Another interesting finding is that under the growing stress of both life and work, undergraduates now no longer prefer to work exclusively in the most developed cities, including Beijing, Shanghai and Guangzhou. Less than 40 percent of undergraduates surveyed expressed their willingness to work in these three cities, much lower than the percentage in previous Zhaopin.com “China Best Employer” reports. Chinese companies need to pay attention to the high housing prices, long work hours, traffic congestion and air pollution in Beijing, Shanghai and Guangzhou that are forcing more than just undergraduates to want to avoid and get away from these cities.
These findings revealed the obvious changes in criteria that undergraduates apply to the decision making process as they choose what they consider to be the best place to work. The focus on non-material factors among young and sensible undergraduates when considering job opportunities shows the positive trend in the human resources sector across China and in Zhaopin.com’s brand building achievements. Zhaopin.com “2013 Top Employers Gaining Most Attention from Undergraduates” survey is expected to offer more successful brand building cases.
Graduates increasingly willing to work in second and third-tier cities
December 25th, 2013More undergraduates are willing to leave Beijing, Shanghai and Guangzhou to seek work in second and third-tier cities, says a report by a Chinese employment website, the Nanfang Daily reported.
But demand for labor remained strong in 2013, especially in the financial and real estate industries, according to the "Change, Leading Trend; Mission, Boosting Growth" report released by Zhaopin on Monday.
More college students are willing to leave Beijing, Shanghai and Guangzhou to work in second and third-tier cities, different from 1970s and 1980s trends, the report noted.
About 46 percent of students were willing to go to second and third-tier cities in 2011. The 2013 figure rose to 61 percent. The proportion willing to work in Beijing, Shanghai and Guangzhou was 53.8 percent in 2011, plunging to 38.7 percent in 2013.
Vacancies grew 26 percent in central China, 29 percent in western China and 25 percent in eastern China.
Vacancies in the first 10 months of this year increased 26 percent over the same period last year, according to Zhaopin data, with recruitment rising rapidly in the finance and real estate sector.
The financial industry saw the most growth in vacancies, rising 91 percent from the same period last year. Employment opportunities in real estate grew 53 percent. New manufacturing job positions increased 9 percent. Foreign investment companies saw the weakest growth in recruitment of 3 percent.
Demand for labor and talent on the market was large, summarized Zhaopin chief executive Guo Sheng, but undergraduates often could not find jobs to match their majors. Companies didn't always need university undergraduates' skills, but relevant jobs skills.
Companies were more willing to employ workers with experience in society. People born in the 1990s were unwilling to accept a job below expectations, Guo claimed.
"This report for the first time uses the data from the job-hunting Internet, analyzing the relationship between the labor market and macro economy," Guo said. "The year 2013 is a reform year, but also the biggest year of change in the human resources and labor markets."
Job center focuses on helping expatriates
December 24th, 2013Moving your entire life to a foreign country can be hard. Finding housing, schools, medical care, not to mention a decent job, are just a few of the hurdles expatriates face.
Now China hopes to entice more skilled experts to its shores by making the task of relocating and securing a dream job a little bit easier.
The newly revamped Shanghai Employment Promotion Center has been modeled as a one-stop shop for foreign job seekers.
With more than 430 of the world’s top 500 companies now with offices in Shanghai, one step is to attract experts in short supply.
Shanghai is home to more than 160,000 expats. In 2013, they again ranked Shanghai as the most attractive city in China.
But while Shanghai may wow with its good looks, it’s the overall package that entices expats.
The Shanghai pilot free trade zone, launched on September 29, is China’s latest move in expanding economic dealings with the outside world.
Once upon a time, Chinese bureaucracies like the SEPC were little more than a rubber-stamp department, drowning applicants in mountains of paperwork.
But, at its base in Shanghai, staff here are now trying to woo workers from all corners of the world with the benefits of grabbing a job in the city.
Utilizing networks
Ding Feng, the center’s director, said they are the first port of call for companies seeking a recruitment permit, a requirement for hiring foreign workers in China.
“Foreign job-seekers could get work visas with the recruitment permit and then apply for a foreigner employment permit,”Ding said.
Documents here are in English, allowing foreigners with little knowledge of Chinese to register for employment or extend their visa.
“This is my first time and so far it seems to be very efficient,”one American job seeker said.“The staff are very helpful.”
Beyond the paperwork, the center has now extended its scope to helping expats utilize educational, medical and social networks.
It’s all part of the government’s recent endeavor to make their departments more service-oriented. Foreign employees, who are referred to as“foreign experts”in China, are among the target population of such services.
Rose Oliver from Britain is one of them. The 49-year-old works as a professor at Shanghai University.
“I found it to be more than just a bureaucratic-like agency,”Oliver said.
“It is more than an office that facilitates visas. They are actually concerned with expats’working lives, their lifestyles and the quality of life they have in China.”
Oliver said it’s the center’s personal touch that has helped her to“have real exposure to Chinese culture.”
This includes the cultural events run by the center that provide foreign experts with knowledge about living in China.
According to Huang Weimao, deputy director of the Shanghai Foreign Experts Affairs Bureau, streamlining all-important social security services is another vital role. The SEPC is under the bureau’s jurisdiction.
“We have close contact with expats, to give them help with obtaining child education, medical care and even housing,”Huang said.
The help is appreciated by expats like Oliver.“They provide a lot of security.”
“When we have problems, I contact Huang. We don’t necessarily have daily contact. But at least there is the knowledge that they are there if you need them,”Oliver said.
Health care concerns
Besides basic medical insurance, the bureau has coordinated with a state-owned company to offer tailored medical services for expats.
“Foreigners tend to have higher requirements,”Huang said.
The offerings of assistance have been expanded as part of the Expats Residence Law. The law, which took effect on July 1, grants foreign workers with a bachelor degree or above, equal access to investment, government jobs, schooling, and an all-important driver’s license.
Russian biologist Philip Khaytovich works in a joint scientific research center established by the Chinese Academy of Sciences and Germany’s Max Planck Society.
“Before it was not clear what to do with us, because there was no legal framework to deal with foreigners, like how to provide social insurance,”Khaytovich said.“Now it has all changed.”
Khaytovich is part of China’s“1,000 Foreign Talents”program used to recruit scientists from around the world.
“I was fortunate to get into the talent program, as it provides generous support for our work. I think this can make China a very attractive place for research.”
The bureau is responsible for the program’s talent recruitment. With the top 500 companies on the look-out for executives and managerial experts, the bureau is right there helping.
Huang is especially seeking experts in the ship building, automobile, electro-mechanics and new materials industries.
Long-term visa
As part of luring and securing expat workers, China has plans to introduce a long-term visa. It will replace the working visa, which must be renewed annually.
“A lot of expats are willing to stay for a long time,”said Oliver.“They aren’t just coming for a year or two. They are coming to make a life here.”
Huang also just put another improvement in the pipeline.
“Foreign experts require a flexible visa policy," Huang said.“The creation of the Shanghai free trade zone provides a chance for change.”
Khaytovich, 40, said he has already considered retiring in China.
The new residence law for expats allows foreigners to collect a pension, but Huang still admits new provisions may take some fine tuning.
How to apply for a foreigner employment permit
Requirements:
1. Applicants should be in good health with no infectious diseases such as leprosy, AIDS, STDs or pulmonary tuberculosis. They should also have no other disease according to specific job requirements.
2. An assured work unit.
3. Professional skills, proper educational degrees and over two years of work experience related to the job.
4. No criminal record.
5. Valid passport or other international travel identification that can substitute.
6. Men between 18 and 60 years old and women between 18 and 55, under common situations.
7. Other requirements required by laws and regulations.
Application materials:
1. An application form.
2. Copies of valid business licence or other legal registration certificates and organization code. Foreign enterprises should also provide a copy of the approval certificate.
3. The applicant’s resume including the highest educational degree and complete experience. The resume should be printed in Chinese with the employer’s seal.
4. Related certificates of applicant’s skills (certificates should be issued by related organizations or by the applicant’s former employers.)
5. Copy of related educational diploma to the job in China.
6. Copy of the applicant’s valid passport.
7. Other materials required by issuing authorities.
Where to submit
? Shanghai Employment Promotion Center
Address: 4F, 77 Meiyuan Road
Phone: 12333 or 3251-1585
Opening hours:
9am to 11:30am and 1:30pm to 5pm from Monday to Thursday
9am to 11:30am and 1:30pm to 3:30pm on Friday
Closed at weekend.
? Foreigners in Huangpu, Xuhui, Jing’an, Changning, Jiading and Putuo districts and the Pudong New Area can go to district employment promotion centers to apply for the permit. Foreigners in other districts must go to the Shanghai Employment Promotion Center.
Huangpu: 525 Nanchezhan Road
Xuhui: 1F, 9118 Humin Road
Jing’an: Counter 5, 2F, 241 Wuning Road S.
Pudong: 3995 Pudong Road S.
Changning: 1F, 517 Wuyi Road
Jiading: 1F, 119 Jiajian Road
Putuo: 1F, 1036 Wuning Road
Bankers concerned over credit risks of SMEs
December 24th, 2013Chinese bankers are concerned about credit risks connected to enterprises that are affected by the nationwide campaigns to eliminate outdated industrial capacity and curb local government financing vehicles, said a report released on Monday.
The report, based on a survey by the Chinese Banking Association and Pricewaterhouse Coopers, which polled 1,604 bankers across 31 provinces and municipalities, said 54.5 percent of the surveyed bankers said they believe adjusting the nation's industrial structures may increase credit risks to China's banking system.
Also, 31.6 percent said they believe that nonperforming loan risks are most likely to involve micro-sized and small enterprise loans. Among the bankers, 61.3 percent said the Yangtze River Delta is most likely to face the pressure of increasing NPLS, since the region is host to micro-sized and small company enterprise hubs, which face systemic risks.
Market insiders said loans to micro-sized and small enterprises have been increasingly disputed in the banking industry. While some lenders think such loans may offer new growth opportunities, others have shunned applications for such loans.
"Leaders of banks are torn over the risks of loans" to smaller companies, said a source with a Shanghai-based, State-owned bank.
On the one hand, governments at various levels encourage support from the financial sector to small enterprises to help them grow, and such loans may indeed help them out during hard times.
On the other hand, it is quite risky to make loans under current conditions. In many cases, the applicants do not have guarantees, and they are seeking unsecured loans, said the source, who declined to be identified due to the sensitivity of the matter.
NPLs have been rising in recent months, and they climbed by the largest amount in the third quarter, according to data from the China Banking Regulatory Commission.
Bad bank loans outstanding increased by 24.1 billion yuan ($3.96 billion) to 563 billion yuan at the end of September. But due to swift overall loan growth in the third quarter, Chinese banks' NPL ratios ticked up only slightly.
The system-wide NPL ratio reached 0.97 percent, compared with 0.96 percent at the end of June, the commission said.
About 43 percent of polled bankers said they have been closely watching the risks exposed to debts of local government financing vehicles.
On Dec 10, the central government announced that the performance evaluation of local government officials will no longer be based primarily on economic growth, but rather on sound financial management.
"The change is credit-positive for local governments as well as the central government, because reduced incentives to promote economic growth at all costs will instill fiscal discipline and curb the rapid rise in contingent, quasi-government debt," said Debra Roane, vice-president and senior credit officer of the sub-sovereign group at Moody's Investors Service in a note.
The new evaluation criteria should lead to greater discipline in borrowing. Local officials will be held accountable for their investment and borrowing decisions, including those related to LGFVs, and their handling of these decisions will be a key factor in promotions, said Roane.
The National Audit Office's initial survey of government debt revealed that LGFV debt alone amounted to 10.7 trillion yuan at the end of 2010, or 27 percent of GDP, of which 6.7 trillion yuan was classified as direct debt of local governments.
Moreover, estimates by the International Monetary Fund show a much greater increase and level of debt operationally outside the general government budget.
Foreign firms downsize in China amid slowing growth
December 20th, 2013Foreign companies may soon axe jobs in China given the slowing growth in the country, according to a report on Sina's news portal.
Hewlett-Packard CEO Meg Whitman has already announced intentions to cut 27,000 jobs worldwide by the end of next year, and the decision may affect 20% of its employees in China, the report said.
Sources from the American IT giant dismissed the 20% claim however, saying only a small percentage of Chinese workers will be affected.
In addition to HP, IBM may also cut its workforce soon due to global declining sales, which reports that it will let go between 6,000 and 8,000 employees, including those in China.
IBM said in October that demand in China had slowed. Executives from IBM China said the restructuring of the workforce will continue as the company pursues transformation in a changing industry.
Meanwhile, consumer goods giant Unilever has decided to cut 2,000 jobs in emerging markets including China to reduce labor costs as a result of sliding sales in the third quarter.
Aon Hewitt from Korn/Ferry International, the world's leading headhunting firm, said recruitment by multinationals in China has slowed greatly this year compared with last year. Figures from Chinese job bank Zhaopin also showed that the number of newly created openings by Western enterprises has dropped 5% this year, despite an overall 30% increase in new job offers on its site.
AVIC unveils plan for next-generation regional aircraft
December 20th, 2013China's major aircraft manufacturer announced on Thursday the launch of its new regional turboprop program, an indication that the country is investing heavily to grab a bigger share of the civil aviation market.
Dong Jianhong, chief designer of the aircraft at Aviation Industry Corp of China, the nation's largest aircraft manufacturer, said at a news conference in Beijing that the next-generation turboprop, the 78-seat MA-700, will serve regional air transportation within an 800-km range and be able to fly at high altitudes and in high temperatures.
He said the AVIC turboprop will have a cutting-edge design, low operation and maintenance costs, eco-friendly technology and rigorous safety standards.
"The safety standards we adopt will be even stricter than those of civil aviation authorities in China and other nations," Dong added. "We also designed a spacious place for each passenger that is larger than that of other aircraft of its kind."
The aircraft will have the most advanced flight control system — fly-by-wire technology — its first use on a turboprop aircraft.
The designer said the MA-700 will be able to carry a payload of up to 8.6 metric tons and fly 610 km per hour.
The plane's design is expected to be finalized next year, and its maiden flight is set for 2016.
The aircraft will be delivered to buyers in 2018, he said.
Before the new aircraft, AVIC developed the MA-60 turboprop regional airliner and its upgrade variant, the MA-600.
Eighty-eight MA-60s or MA-600s have been delivered to 24 buyers from 16 nations in Asia, South America and Africa, said Pang Zhen, head of AVIC's civil aircraft development.
The rising cost of aviation fuel has put airlines under heavy pressure, making turboprop aircraft, which consume less fuel than turbofan jets, more attractive.
Pang said the global market will need at least 2,900 turboprop regional airliners in the next 20 years, and China will need nearly 350 during this period.
China has nearly 2,000 airliners, 92 percent of which are large aircraft that have more than 100 seats. The situation forces carriers to use large planes to conduct short-distance flights or even abandon short-haul routes, leading to economic losses, Pang said.
Liu Jieyin, executive vice-president of Beijing-based Okair Airlines, echoed Pang's remarks on the need for more turboprops. Airlines are usually reluctant to use large aircraft to perform short-distance flights because it accelerates wear and tear on engines and other costly equipment while making only small profits, Liu said.
Meanwhile, taking regional aircraft for short trips is more convenient for travelers than other forms of transportation, which plays into the huge demand for such planes, he said.
"Say you want to travel from Yantai in Shandong province to Dalian in Liaoning province. An MA-60 makes the flight in 45 minutes, but it takes six to seven hours if you go by ship."
Liu said his company has signed an agreement with AVIC to procure 50 MA-series aircraft, including the MA-700 and its variants.
Geng Ruguang, AVIC deputy general manager, said the company has commissioned consulting agencies to survey 112 potential users and will consider their requests and suggestions in the design process.
The MA-700 platform will also be refitted to serve multiple purposes such as medical service, search and rescue, maritime surveillance and scientific experiments, he added.
GSK revamps sales reps' compensation
December 19th, 2013British pharmaceutical giant GlaxoSmithKline announced on Tuesday it will on longer reward its Chinese sales representatives based on their sales volume, a vast change after the company became embroiled in a series of bribing scandals.
The new system applies to all of the GSK sales employees, including sales representatives and sales managers, who interact with prescribing healthcare professionals, according to GSK's Tuesday announcement.
Under the new system, all customer service employees will be evaluated on technical knowledge, quality of service and adherence to the company values of transparency, integrity, respect and patient focus.
GSK is the first pharmaceutical company to publicly implement such changes in China. The company said the new system allows it to put patients' needs above everything else it does.
The Chinese government initiated an anti-corruption campaign for the medical industry in July after conducting a bribery investigation into GSK.
According to China's public security authorities, the company allegedly used travel agencies to funnel at least 3 billion yuan ($489 million) in bribes since 2007.
The scandal widened across an industry in which other multinational pharmaceutical companies also faced scrutiny in China over claims they bribed medical staff to prescribe their products.
GSK denies that the new move is directly related to the probe by Chinese authorities, saying the changes are part of its efforts to evolve their business model, build trust in the markets and improve transparency.
Experts said GSK and its sales team face a difficult transition.
"It will take some time for GSK to find out how to improve the effectiveness of its incentive system and how to encourage its salespeople to pay attention to their service quality for more income," said Bruce Liu, partner and co-head of the Pharma & Healthcare practice at Roland Berger Strategy Consultants.
Liu said GSK's former payroll was based on objectives, which translates to sales volume, but it now is focused on process management.
"It is helpful to improve employees' academic level in order to provide professional information to doctors," he added.
"Our medical representatives are the gateway to our customers, and it is important that we inspire, coach and ultimately reward people working within the organization to focus on behaviors that reflect our values," said Herve Gisserot, senior vice-president and general manager of GSK Pharmaceuticals and Vaccines China.
But Liu cautioned that GSK's changes "will not get instant results."
In the third quarter that ended Sept 30, the company reported a 61 percent year-on-year slide in its China pharmaceuticals and vaccines business.
But the crisis, Liu said, could be a blessing in disguise.
Since the government is encouraging private investment in the medical sector and prioritizing support of nonprofit hospitals run by private investors, and as experts are calling for the separation of medical services and drug sales in hospitals, Liu said GSK's prompt action will help the company grab market share ahead of its peers.
GSK also announced it will stop paying individual healthcare professionals to attend medical conferences and instead will fund education for them through independent grants.
The transition to the new sales compensation model will start in January in China as well as in other markets around the world.
China Mobile set for 4G services in 340 cities
December 18th, 2013China Mobile, the nation's biggest telecom operator by subscriber numbers, will offer commercial fourth generation (4G) telecom services in 340 Chinese cities next year.
Xi Guohua, chairman of China Mobile Ltd, said on Wednesday that the company will build 500,000 4G base stations across China in 2014, constituting the world's largest 4G network. Xi was speaking during the China Mobile Global Partner Conference in Guangzhou.
"China Mobile's marketing focus next year is in terminal sales, since mobile terminals are the foundation for mobile Internet development," Xi pointed out.
Xi predicted that the total number of TD-LTE mobile phone models will pass 200 and entry-level 4G smartphones will hit the market in 2014.
China Mobile is targeting sales of 190 million to 220 million mobile terminals running on its wireless networks by 2014, Xi said.
In order to attract more users, China Mobile will offer generous subsidies. The company plans to invest 2.7 billion yuan ($442 million) in handset subsidies next year.
Banks to sink or swim with removal of rate caps
December 18th, 2013Deposit and loan margins will likely narrow, though not as much as expected, after the central bank removed a cap on deposit rates as part of its interest rate liberalization, central bank governor Zhou Xiaochuan told Caijing magazine on Tuesday.
Zhou said loan rates likely will rise, along with deposit rates, but uncertainties remain as to whether the rate margin will widen or narrow.
What is certain is that after the liberalization, risk premiums will stay little changed across sectors, and money will be spent more efficiently.
Zhou's comments came after Beijing wrapped up its annual Central Economic Work Conference. A communique issued in the wake of the meeting listed interest rate liberalization as one of the six top economic priorities for next year. In its 60-point blueprint guiding China's reforms over the next decade, Beijing promised the liberalization will be completed by 2020.
The People's Bank of China, the central bank, has been loosening its control over interest rates in recent years as a key part of China's broader market-oriented financial reform. The last remaining control is a ceiling on deposit rates, which analysts believe distorts fund pricing and shelters banks from competition.
The average interest rate margin at Chinese banks was 2.63 percent at the end of September, according to China Banking Regulatory Commission data.
The rate was up slightly over the 2.59 percent seen in the previous quarter.
Zhang Qi, an economist with Haitong Securities Co Ltd, predicted lenders would struggle in the post-liberalization era.
"For lenders, making money will not be as easy," he said.
Zhou said that, barring a crisis, the central bank has no incentive to give financial institutions any special treatment, indicating that it won't shelter banks that are struggling to compete. "In normal times, we hope banks will provide better financial services to the society through competition."
A thinner interest rate margin likely will take a toll on Chinese lenders, whose balance sheets already are laden with bad loans stemming from China's 4 trillion yuan ($654.12 billion) stimulus to save the economy at the height of the financial crisis in 2008.
Chinese banks' share prices already had dropped last year, despite their healthy earnings, as investors feared the effects of interest rate liberalization.
The bank shares' average price-to-earnings ratio, a key measure of valuation, is about 6, compared with 11 in the entire A-share market.
To help the State-owned lenders get through a rough patch, Beijing has been making efforts to strengthen its balance sheets.
In August, Premier Li Keqiang promised to extend a pilot plan to sell bonds backed by bank loans. The bonds will be traded for the first time on exchanges. The move is expected to help banks unload problematic loans.
Last week, China Cinda Asset Management Co Ltd raised 2.5 billion yuan at its listing in Hong Kong, and a bulk of the money will be spent buying up bad assets from the banking industry.
Cinda is one of the four bad debt managers founded in 1999 by Beijing to clear up bad loans from China's State-owned banks. The other three also are expected to raise funds in the near term.
Production to slow down: HSBC
December 17th, 2013Workers assemble heavy equipment at a factory in Qingzhou, Shandong province. A preliminary reading of the Purchasing Managers' Index for the manufacturing industry edged down to 50.5 in December from 50.8 in November, the lowest level since October, HSBC Holdings Plc said in a report.
Preliminary manufacturing PMI shows weaker growth in December
China's manufacturing sector will likely see the slowest expansion in three months in December because of lower output growth, HSBC Holdings Plc said on Monday.
A preliminary reading of the Purchasing Managers' Index for the manufacturing industry edged down to 50.5 in December from 50.8 in November, the lowest level since October, the bank said in a report.
The production output sub-index slipped to 51.8 in December from 52.2 in November, pressuring the index.
Meanwhile, the new orders sub-index hit a nine-month high of 51.8 in December, compared with 51.7 in November, while the new export orders sub-index rose to 50.3 from 50.2 last month, suggesting stable market demand.
A reading above 50 indicates expansion, while one below that level signals contraction.
The official PMI data for December will be released on Jan 1 by the National Bureau of Statistics and the China Federation of Logistics and Purchasing. HSBC will release its final PMI data on Jan 2.
Qu Hongbin, chief economist in China at HSBC, said that although December's preliminary manufacturing PMI reading slowed marginally from November's final reading, it still stands above the third quarter's average reading of 49.7.
The latest reading implies that the manufacturing sector's recovery, which started in July, is still holding up, Qu said.
He believes that China's GDP growth will stabilize at about 7.8 percent year-on-year in the fourth quarter.
Zhang Zhiwei, chief economist in China at Nomura Securities Co Ltd, said that the slowdown in the PMI data "suggests that growth momentum has started to weaken".
"This trend is likely to continue in the first half of 2014, as market interest rates keep rising and pushing up financing costs for enterprises," said Zhang.
Figures from the central bank showed that new loans came in at 625 billion yuan ($103 billion) in November due to stronger retail and short-term corporate loans, rebounding from 506 billion yuan in October. Off-balance sheet lending saw a broad-based recovery to 377.9 billion yuan in November from 184 billion yuan in October but was still below the August-September levels.
A report from Barclays Capital said that short-term bill issuance has increased, as rising funding costs have probably led companies to rely more on short-term financing.
According to the NBS, industrial output growth in November slowed to 10 percent year-on-year from 10.3 percent in October, which may indicate that the GDP growth rate in the last quarter may be at 7.6 to 7.8 percent, compared with 7.8 percent in the third quarter and 7.5 percent in the second, analysts said.
Growth in Recruitment Needs of China's SMEs Closely Follows Those of Country's Large Conglomerates
December 16th, 2013The selection process for the China Best Employer Award 2013 (best.zhaopin.com), an event hosted by Zhaopin.com (www.zhaopin.com), China's largest recruitment website, came to a successful conclusion recently in Sanya, China. At this HR industry event, co-hosted by Zhaopin.com and the CSR and Employer Brand Communication Research Center of Peking University, China's top 500 and other large companies were the biggest winners. Noticeably, though, small and medium sized enterprises (SMEs) nationwide have made great strides in brand building, and despite their gap with larger companies, their excellent performance deserves a closer look.
The development of Chinese SMEs has become a hot topic. SMEs, constrained by their smaller size, have paid increasing attention to brand building. Relative to large Chinese companies, SMEs may be better situated to play to their strengths through brand-building efforts to survive in a competitive market. For SMEs, a good brand image not only enhances their market share and customer loyalty, but also attracts the most qualified job seekers. The latter is especially vital for Chinese SMEs wishing to eliminate bottlenecks that stand in the way of development, and even survival.
At the award ceremony, Guo Sheng, CEO of Zhaopin.com, explained his firm's analysis of the growth trends in employment during 2013 among companies of different sizes. It was inferred that in comparison with conglomerates with 10,000 or more employees, in 2013, China's SMEs experienced significant growth in recruitment needs. They expect to boost their brand image as an employer by building a good brand and, in doing so, attract the best that the job market has to offer, accelerating their development.
According to Zhaopin.com's best employer survey, the opportunity for self-improvement ranked first among the key characteristics of the best SME employers, this mainly being driven by the relatively extensive division of labor and the simple structure of Chinese SMEs. Employees expect to have more opportunities and a larger platform to demonstrate their personal abilities and to further enhance those abilities. Furthermore, employees of SMEs also attach importance to the respect they get from superiors, to the fulfillment of employers' promises and to the provision of a proper employment contract and social insurance package. It is clear that China's SME employees have reasonable expectations of the best employers and are well aware that despite no hard indicators, SMEs have their own unique model in terms of "soft power", giving SMEs unique advantages in attracting talent.
The survey revealed that the prospective growth in salary ranks second only after the opportunity for self-improvement among the characteristics of best employers. After getting a few years of experience, employees will have higher income expectations and hope to receive better treatment as a reward for their contribution, something that is undoubtedly a weak point for SMEs that lack competitive advantage when it comes to what they can offer as compensation. It therefore behooves Chinese SMEs to start thinking about and planning ahead on how to retain employees and stimulate the initiative and cohesiveness of their workforces.
Given the aggressive momentum of large well-established companies, maintaining a delicate relationship between "humanity" and "human" is key for Chinese SMEs wishing to enhance brand image. Numerous Chinese SMEs offer excellent examples on how they "fought back" by taking the high road to enhance their brand image. Zhaopin.com, through the China Best Employer Award program, looks forward to bringing more publicity to lessons gleaned from the success stories of SMEs that made the effort to enhance their brand image.
Apple sends in experts to probe employees' deaths
December 13th, 2013Electronics giant Apple Inc said on Thursday it has sent independent medical experts to one of its major contractors in China amid accusations that bad working conditions led to several workers' deaths.
"We are deeply sad about the deaths of laborers at Pegatron and have commissioned independent medical professionals from the United States and China to conduct probes since last month," Apple said in a statement.
"While they have found no evidence of any link between the deaths and working conditions there, we realize that is of little comfort to the families who have lost their loved ones."
It added that Apple has a "long-standing commitment to providing a safe and healthy workplace for every worker in our supply chain", and the company has formed a team to work with Pegatron Technology Co at the contractor's plants to ensure that "conditions meet our high standards".
Pegatron, a Taiwan-based manufacturing company that supplies Apple, Sony and Dell, confirmed on Wednesday that four workers at its Shanghai factory, which has nearly 100,000 employees, had died of diseases.
The announcement came after New York-based advocacy group China Labor Watch said on Monday that several workers at Pegatron's Shanghai plant "passed away in a short period of time", Bloomberg reported on Thursday.
Bloomberg cited a statement from the labor rights group as saying that among the dead was a 15-year-old worker who died of pneumonia on Oct 9 at a Shanghai hospital.
The Taiwan company said in a statement that "Pegatron has strict measures in place to verify workers' ages before and after they are hired, and we work with health and safety experts to provide a safe working environment for each and every worker".
The young worker who died in October used his 21-year-old cousin's identification to apply for the job, Pegatron said, adding that the factory did not know he was underage.
This is not the first time Pegatron has been targeted by China Labor Watch.
In July, the organization said it found at least 86 violations at the Pegatron factories in Shanghai and the neighboring city of Suzhou.
The violations included demanding employees work 66-69 hours a week, beyond the legally required 49-hour maximum, without overtime being paid.
Pegatron was also accused of using underage workers as interns who worked the same long hours at the factories.
However, Feng Xiliang, a labor rights expert at Capital University of Economics and Business, told China Daily that many workers at electronics companies are willing to work overtime because they want to earn more money.
"Regular wages at most plants that manufacture electronics products are usually low so those young workers must work longer to earn more," Feng said, adding that the younger generation of migrant workers has stronger awareness of its rights and is calling for a more powerful labor union to protect its interests.
"Consequently, Apple and its suppliers have been improving their performance in the labor rights field because they don't want to project a negative image to consumers."
Wang Kan, a researcher in labor rights at the China Institute of Industrial Relations in Beijing, added that working conditions at Apple's contractors are much better than those at many other electronics factories.
"Compared to the time when Steve Jobs managed the company, Apply now is paying more attention to its image in consumers' eyes when it comes to labor rights," Wang said. "I am not saying it is perfect, but it is fair to say that the company has improved substantially in this regard."
Wang said most underage young people working at manufacturing plants are students sent by vocational schools as interns, and are prone to working with hazards due to loopholes in laws.
"Education laws and regulations do not cover their internships at factories, while labor codes do not categorize them as employees," Wang said.
Agency releases 2014 holiday plan
December 12th, 2013The national body responsible for deciding China's holiday dates has released the national holiday schedule for 2014, provoking mixed reactions from the public.
The schedule, issued by the General Office of the State Council on Wednesday, links official holiday periods with weekends, thus extending the number of consecutive days workers can take off.
The new arrangement means that Spring Festival and National Day holidays will be extended to seven-day breaks. Meanwhile, the Chinese Tomb Sweeping Day, Labor Day, Dragon Boat Festival and Mid-Autumn Festival will become three-day holidays. However, New Year will be celebrated as a one-day holiday.
Excluding the attached weekends, there will be 11 official days of holiday through 2014, a figure similar to previous years.
"I was hoping the total number of national holidays would increase. It is really disappointing that it didn' t go up at all," said Cheng Jia, 30, from Beijing.
Another Beijing resident, Wei Bo, 59, said: "I do not see much difference between the schedule for 2014 and previous years, except for the arrangement for Spring Festival holidays. According to the new schedule, we will still have to work on Chinese Lunar New Year' s Eve — the time we are supposed to have our family reunion. This is so inhumane."
Also on Wednesday, the State Council released amendments to the National Annual Leave and Memorial Days regulation dealing with national holidays. Enacted in 1949 and amended several times, it stipulates the specific days and lengths of national holidays.
This year' s amendment changed the Spring Festival to the first three days of the first lunar month of each year. According to a previous amendment to the regulation made in 2008, the three-day Spring Festival started on the last day of the lunar year.
Cai Jiming, director of the Center for Political Economy at Tsinghua University, who leads a team researching holiday system reform, was also involved in the 2008 amendment.
He said the change will bring inconvenience to people who are asked by employers to work till the last minute.
His team had proposed to expand the Spring Festival from three days to four days, but the proposal was not adopted by the government.
ManpowerGroup Inc. : Promising Signs for Global Hiring Heading into 2014, According to Manpower Employment Outlook Survey
December 11th, 2013Fewer Indications of Retreat in Employer Confidence; Hiring Pace in G7 Countries Expected to Improve or Remain Relatively Stable
Employers across the globe expect a cautious yet positive approach to hiring for the start of 2014, despite ongoing economic uncertainty and disruption. Upticks in payrolls are anticipated by varying degrees, according to the first-quarter Manpower Employment Outlook survey, released today by ManpowerGroup (NYSE: MAN).
This quarter's research of over 65,000 hiring managers across 42 countries and territories reveals:
* Encouraging New Year Signs for Global Labor Market: Employers in 34 of 42 countries and territories expect to increase payrolls in the next three months, compared with 29 in Q4 2013. Hiring plans strengthen in exactly half of countries and territories, weakening in 15 quarter-over-quarter. Outlooks are stronger in 21 countries and territories compared with one year ago at this time, and decline in 17.
* Where First Quarter Hiring Plans are Strongest: Employers in Taiwan, India, New Zealand, Colombia and Singapore report the most optimistic outlooks, while the weakest - and only negative - outlooks are reported in Italy, Ireland, Finland, Spain, Slovakia and Belgium.
* Japan Outlook Strongest in Nearly Six Years: Japanese employers report the most optimistic hiring intentions since Q2 2008, with Tokyo's outlook the strongest since Q3 2008, while their Chinese counterparts anticipate no change in hiring plans - a steady Net Employment Outlook of +13% for the coming quarter.
* Brazil Slows Back to the Pack: Brazilian employers forecast their weakest hiring climate since the survey began in Q4 2009, but still expect favorable hiring. Elsewhere in the Americas, US employers report steady hiring activity and the region's least optimistic hiring plans are reported in Argentina.
* Europe Fragile but Greece Makes Strides: As in the previous quarter, Europe's strongest hiring plans are reported in Turkey. Greek employers forecast the strongest hiring pace since Q4 2008, improving by 6 and 17 percentage points from Q4 2013 and Q1 2013, respectively. Hungarian employers report their most optimistic hiring plans since the survey began there in Q3 2009. Modest payroll gains are anticipated in France. Hiring prospects remain relatively stable quarter-over-quarter in Germany, but are three percentage points weaker year-over-year. Irish, Italian and Spanish employers continue to predict weak labor markets.
"Employers in many parts of the world anticipate mostly modest payroll gains, which may nevertheless be a sign of some gathering hiring momentum as we head into 2014," said Jeffrey A. Joerres, ManpowerGroup Chairman and CEO. "However, whether you view labor market growth as steady or stagnant may well depend which side of the interview table you're sitting on. Employers will see these gains as a sensibly cautious approach to ongoing certain uncertainty, while job seekers may interpret the results as a sign of labor market stasis."
"With some exceptions - notably Brazil and, to some extent, mainland China - the report indicates few signs of a general retreat in employer confidence. When compared quarter-over-quarter, employer hiring intentions in the G7 countries improve or remain relatively stable and many employers tell us that they intend to add to their payrolls, but at far more modest rates than in the pre-recession years. It may well be that varying levels of marginally positive hiring intent is as good as it gets."
Employer hiring intentions remain positive in all 10 countries ManpowerGroup surveys in the Americas. However, the first-quarter forecasts are mostly weaker in both quarter-over-quarter and year-over-year comparisons. Colombian employers expect the strongest hiring pace with three out of 10 employers expecting to grow first-quarter payrolls. A steady hiring pace is also expected in Brazil, but the country's outlook has weakened by varying degrees for nine consecutive quarters and now stands at its weakest point since the Brazilian survey was launched in 2009. The U.S. outlook remains upbeat and is relatively stable in both quarter-over-quarter and year-over-year comparisons.
"Despite fears that the recent government shutdown might dent hiring confidence and the multitude of outside factors that contribute to an uncertain landscape, American employers continue on the five-year pattern of steady jobs growth," said Jonas Prising, ManpowerGroup President. "Hiring has been particularly robust in wholesale and retail, and our survey tells us that is likely to be the case into the new year."
Regionally, employers throughout Asia Pacific continue to report positive Net Employment Outlooks. Job seekers in Taiwan are likely to benefit from the most robust hiring pace in the region, with more than one of every three employers indicating they plan to add to their payrolls in the first quarter. First-quarter prospects are also bright for India's job seekers with a brisk hiring pace expected in most industry sectors and all regions. Japan's outlook stands at its strongest since the second quarter of 2008 following more than four years of steadily improving forecasts. Hiring plans also remain positive in China, but the outlook continues to rest at a position below the more optimistic forecasts of late 2010 and early 2011, adding further evidence that the country's growth track may be leveling off. The region's weakest forecast is reported in Australia despite moderate quarter-over-quarter improvements in both the Mining & Construction and Finance sectors.
"Chinese employers are increasingly concerned that they will experience managerial shortages in the future. To continue on its path of sustainable growth, China needs to build a home-grown cadre of globally minded, savvy business leaders," said Darryl Green, ManpowerGroup President. "The situation is similar in Japan; the needs of corporate Japan are not met by the young people that are being produced by Japanese education and society. Unless actions are taken to address these problems, the country's competitive edge will continue to erode."
Europe paints a very mixed picture. The region's strongest hiring plans are reported in Turkey and weakest in Italy where for the 12th consecutive quarter employers report negative hiring intentions. Conversely, opportunities for job seekers in Greece are expected to noticeably shift to the positive in the next three months as the outlook climbs for the sixth consecutive quarter and employers report the strongest hiring intentions in over five years.
"The Eurozone recovery remains tepid but employers in the region continue to show signs of cautious optimism. Crucially, Germany shows stability but talent shortages there are a recurring theme and recruitment strategies need to be adjusted accordingly to embrace flexibility," added Green. "The Republic of Ireland's impending exit from international bailout is a positive step. Meanwhile, the UK unemployment rate has fallen to its lowest level in more than three years but the high number of people in part-time work means that serious challenges remain."
The Manpower Employment Outlook Survey Explorer tool, a new interactive way to examine and compare ManpowerGroup's data, can be viewed at http://www.manpowergroupsolutions.com/DataExplorer/. The tool includes at-a-glance maps and graphs that plot historical and current global hiring trends. The next Manpower Employment Outlook Survey will be released on 11 March 2014 to report hiring expectations for the second quarter of 2014.
About the Survey
The Manpower Employment Outlook Survey is the longest-running, most extensive, forward-looking employment survey in the world, commencing in 1962 and now polling over 65,000 employers in 42 countries and territories to measure their intentions to increase or decrease the number of employees in their workforce during the next quarter. The survey serves as a bellwether of labor market trends and activities and is regularly used to inform the Bank of England's Inflation Reports, as well as a regular data source for the European Commission, informing its EU Employment Situation and Social Outlook report the Monthly Monitor. ManpowerGroup's independent survey data is also sourced by financial analysts and economists around the world to help determine the health of labor markets.
About ManpowerGroup
ManpowerGroup™ (NYSE: MAN) is the world leader in innovative workforce solutions that ensure the talent sustainability of the world's workforce for the good of companies, communities, countries, and individuals themselves. Specializing in solutions that help organizations achieve business agility and workforce flexibility, ManpowerGroup leverages its 65 years of world of work expertise to create the work models, design the people practices and access the talent sources its clients need for the future. From staffing, recruitment, workforce consulting, outsourcing and career management to assessment, training and development, ManpowerGroup delivers the talent to drive the innovation and productivity of organizations in a world where talentism is the dominant economic system. Every day, ManpowerGroup connects more than 630,000 people to work and builds their experience and employability through its relationships with 400,000 clients across 80 countries and territories. ManpowerGroup's suite of solutions is offered through ManpowerGroup™ Solutions, Manpower®, Experis™ and Right Management®. ManpowerGroup was named one of the World's Most Ethical Companies for the third consecutive year in 2013, confirming our position as the most trusted brand in the industry. See how ManpowerGroup makes powering the world of work humanly possible at www.manpowergroup.com. Follow ManpowerGroup Chairman and CEO Jeff Joerres on Twitter: Twitter.com/manpowergroupjj
SOURCE ManpowerGroup
Chinese graduates encouraged to work in private firms
December 10th, 2013Chinese graduates are being encouraged by the government to work for non-public companies to boost employment and promote the private economy.
The Ministry of Education on Friday promised to break down barriers so graduates can find jobs in private firms. It said it would also improve the welfare of employees working for private companies, according to a ministry statement.
China has been under increasing pressure to create more white-collar jobs with more people attending college.
Many graduates are trying to grab a position in public offices because of better health care and housing welfare, and slim chances of being laid off.
Statistics showed that applicants taking the civil servant exam this year totaled 1.52 million. However, on average 77 applicants competed for one position, and the enrollment ratio was 7,192:1 for the most wanted government post.
The latest move is also aimed to help spur the private economy's development in the country, which has developed mixed ownership while keeping the dominant role of public ownership.
According to a decision issued last month by the Central Committee of the Communist Party of China, the country decided to lift the status of the private economy and allow more non-public capital into the market.
The central authorities acknowledged the market's "decisive" role in allocating resources.
In Friday's statement, the ministry also asked colleges to encourage graduates to work in small- and middle-sized cities rather than big ones like the provincial capitals.
Graduates are also encouraged to go to the less-developed west parts of China or start a business of their own.
The ministry also said it will establish an employment quality report system, under which various colleges and universities must gradually publicize the employment conditions of their graduates.
Hot on the recruitment trail
December 10th, 2013Bringing in international students is a bonanza or provinces... so where is Manitoba?
CHENGDU, China -- Sandy Prentice is the international program administrator for the Kootenay Lake School Division. The name rang no bells for me. It helped, however, when Sandy explained Kootenay Lake is the school division that serves Nelson, a town of 8,000 in southwestern British Columbia.
What on earth are you doing here? I asked.
"What everybody else is doing," she responded. "I'm recruiting students."
We were in a great exhibition hall at the impressive Shangri-la Hotel, built on park-like grounds at the forks of the Jin and Funan rivers in downtown Chengdu. The hall was filled with neat rows of booths, like streets along which thousands of students, many with their parents, window-shopped for an "international" school where they might study in English.
The largest "district" in this booth city was occupied by American institutions, but there were strong representations from the U.K., France, Italy, Spain, New Zealand, Ireland and on and on.
Canada occupied a couple of blocks, where, not surprisingly, B.C. and Ontario had the most storefronts. Quebec was there, Nova Scotia and Saskatchewan... but not Manitoba.
They were all recruiting students, evidence not so much of a desire to spread "international" know-how, but of the vast amounts of money spreading know-how can earn.
"International education brings into B.C. about $2.1 billion a year," Colin Doerr, a director with the B.C. Council for International Education. "It's right up there with coal development."
B.C. attracts about 23,000 students a year, about one-quarter of the 80,000 international students who arrive in Canada annually. Extrapolating from B.C.'s experience, that makes the sector worth more than $8 billion a year to the Canadian economy.
Not all of those students arrive from China, although a great many of them do.
Sending children abroad to be educated has long been the practice for China's elites. But its popularity is growing as the middle class grows.
Recent Chinese government data indicate 20 per cent of Chinese families are middle-class, meaning 30 per cent of income is available for uses other than necessities. Given China's one-child policy (changed to two-child at the Communist party's recent third plenum) and a culture of saving, it means there are tens of millions of families that can afford to send their child abroad, and they are doing so in ever-greater numbers, and at ever-younger ages.
"Studying abroad is very popular," Ivy Zhang, my Canadian-educated translator said. "People realize that English is a very strong skill, even if you work in China."
Which brings us back to Sandy Prentice, an exemplar if ever there was of how even the smallest Canadian jurisdictions can benefit from reaching out to China, and in particular to the huge, largely untapped second-tier markets such as that offered by Winnipeg's sister city, Chengdu, population 14 million.
Prentice said Nelson realized some time ago there were benefits for both sides in recruiting international students, especially in recent times when Chinese families saw additional benefits in sending their children abroad at high school (and even younger) ages to prepare for university entrance.
Kootenay Lake today teaches 150 foreign students from 11 countries, the biggest contingent from Germany (for whom skiing is a big attraction) followed by Korea, Brazil and China.
Each student earns the school division $12,000 in tuition, a total of about $1.8 million a year, a lot of money for a division that serves a total population of 20,000 -- the 8,000 residents of Nelson and 12,000 more in its catchment.
Then there are economic spinoffs in payments to host families and to the wider B.C. economy as a result of family visits, usually in Vancouver during school breaks. Often families will buy a second residence in Vancouver to facilitate visits over periods that can span six years and more (three high school years and at least three years of postsecondary study).
Prentice explained Nelson is a "white-bread valley" that has few connections with the increasingly international tenor of globalization.
Part of the foster-parent program is designed to change that, if only a little, by requiring families to prepare Chinese meals and share Chinese entertainments. Relationships between foster and Chinese families often become permanent, as do bonds between students and "Mama Bears and Papa Bears."
Colin Doerr, of the B.C. council, said the one-to-one relationships 80,000 international students a year forge over their time in Canada are perhaps the most significant enduring benefit of international education programs... for both sides.
"They provide the single most important partnerships of all that we do," he said.
In the swirl of bodies, I was often stopped and questioned by students, who assumed because of my age and white beard, I must be a professor. Others would stop me for no other reason than to chat in English. One young man followed me for a time eavesdropping on my conversations. "I find it very interesting to listen to what you say," he explained.
At the Saskatchewan booth, we stopped an older woman, thinking she might be considering a career change, but found instead she was an "auntie" picking up brochures for a niece whose mother was at work and could not attend.
The involvement of extended family in educational aspirations is common in China, where traditional family fealty is now more narrowly focused.
The auntie said she was instructed to collect information about Saskatchewan because "it is safe and has clean air."
It was a recurring theme. Hosa, a strapping 6-2 Grade 12 student accompanied by his much shorter parents, said he was looking at Canada because of its "harmony."
His parents, however, were less philosophical.
"Definitely it will be Canada," his father said. "It is a good country with good air quality."
"Saskatchewan has become pretty aggressive about recruitment," said Ian Morrison, a recruiter for the Saskatchewan Institute for Applied Science and Technology. "Saskatchewan's population has grown 10 per cent in the last five years and will grow by 10 per cent again in the next five years, mostly from Asia. Traditionally, we never pursued them (international students) but now we have to. We need them."
He said the Moose Jaw institute has about 350 students from China and is seeking more.
"Most of them are using us for immigration purposes," Morrison said.
For the most part, Chinese students enrol in programs that also earn university credits. After three years, they graduate and are eligible for permanent resident status, which allows them to work. It also makes them eligible for resident tuition fees, which are about one-third of the $10,000 to $15,000 they had been spending as international students.
If all goes well from Saskatchewan's point of view, the students will remain in the province and became highly trained members of the workforce.
We stopped an intense-looking young woman with large, round owl glasses and short pigtails tied above her ears, her clothing and Ugg boots showing a meticulous fashion sense.
Rebecca said she was a Christian and had chosen her name from the Bible.
I confess an inability to guess women's ages in China, perhaps because they are, for the most part, petite.
I asked her if she was looking for a school to which she might go after graduating from high school.
"I am a master's student in linguistics and I'm looking for a school to purse a doctorate," she replied.
Ah, yes, of course.
Rebecca said she was looking for a school in Canada because "I have lots of friends there."
Her English was flawless, but her accent, like so many accents in China where English teachers might be from anywhere in the global village -- from England to India -- was impossible to describe.
She said, however, that the accent of the country in which she studied mattered -- she wants to sound mid-Atlantic.
I asked if she planned to remain in Canada, return to China, or go elsewhere.
"Maybe, it depends," she said.
Which struck me as an extraordinary thing to say. That a young Chinese woman in Chengdu confidently could contemplate a career path that would take her anywhere in the world of her choosing struck me as evidence of how quickly China has changed.
But when I said so, she responded instantly.
"It has always been this way for some people," she said. "Now there are just more of them."
China's returnees focus on career development rather than salary expectations
December 9th, 2013China's maturing economy is creating enormous job opportunities and attracting more overseas students to return home. We hear many stories about lower-than-expected salary offers to people returning from study abroad - some believe the expectations and demands of these returning students are excessive. However, many returnees are already re-aligning their expectations on the basis that starting salary is of secondary importance to career prospects.
The 2013 Beijing autumn job fair for returning students was held on Nov 22, attracting 117 domestic enterprises and over 3000 applicants. Job seekers and employers confirm that there is a new emerging trend in the job market: many applicants are more realistic and have a more reasonable sense of their own value, while employers are willing to offer attractive benefits to recruit overseas-trained talent.
Mr. Xiao Wei is one of the ‘realistic’ job hunters at the fair. He holds a Masters degree in commerce from the Netherlands and has overseas work experience. When asked about his salary expectations during an interview with an auto company at the job fair, he proposed a discreet figure which the employer considered acceptable. Xiao explained that in the first years after returning to China it is vital to accumulate experience and improve all-round abilities and working skills; he is more concerned about whether a job is relevant to his major and offers promising prospects, rather than the salary.
Fei Fei is a young woman who holds a Master degree in legal science from America and has no work experience. She returned to China six months ago. Like Xiaofei, Fei Fei is also keen to find a job which is related to her major, and agrees that the starting salary is not a priority. It is more important to her that she proves herself worthy of a decent salary through work.
On the other side, the cry of “We need talent” was to be heard from employers at the fair. Many of them are willing to offer the best conditions to attract talent, but they are not finding it easy to find the right person who can meet their job requirements.
Bai Zhangde, chief of the Chinese Service Center for Scholarly Exchange (CSCSE) said that more than half of returning students have majored in economics, finance, or a related commercial specialty - they have put themselves into a very competitive environment. Meanwhile, in China more large-scale enterprises need staff who are specialized in new materials, new energy, and environmental protection. There is an imbalance in supply and demand in the job market resulting in returnees complaining that there are no jobs for them, while employers struggle to find people who can meet their requirements. Bai suggested overseas students should consider their future career when choosing majors; restricting their focus to today's "hot subjects" is not a smart decision.
Those responsible for recruitment from the employer side consider that returning students have good personalities and decent communication skills.
Zhang Xiaotang, chief of HR from Beijing Technology and Business University commented that they receive many CVs from applicants coming back from various countries, such the UK, the US, Australia, Japan and others. “We welcome people with different backgrounds to join us.” He suggested people who have just returned to China need to adapt to a new environment.
Although many overseas-educated student have advantages in understanding the international way of thinking and have global vision, once they come back to China it is important that they reacquaint themselves with China and adapt themselves to society and to current career requirements.
Cloud brings knowledge to the fingertips of ambitious techies
December 9th, 2013Many a Chinese company has found the going tough when doing business in Africa, so local entrepreneurs are grabbing the initiative by forming partnerships that will benefit both parties.
Tekeste Sebhat Negga, chief executive officer of Vingu Co Ltd, which deals in cloud technology, is one of them.
Africa often leapfrogs outdated technologies to catch up. It has done that with mobile phones. Cloud computing may be next in line.
"We believe that this is the right time for Africa to move to the future of computing," says Negga, an Ethiopian who is studying electrical engineering and automation at Tsinghua University in Beijing.
"These advances are key for Africa in not only leveling the playing field but also in staying ahead of the curve. Although there are challenges we are very optimistic and are working passionately to achieve our vision of 'Computing for All'."
His partner is VCN Corp of Beijing, which specializes in PC computing technology.
Negga says access to computing will drive the development of Africa. Computing and the Internet are now the foundation of the global knowledge economy but, unfortunately, most Africans do not have any access to the Internet or to computing.
"We started this company because we believed increasing access to computing and the Internet is something that is vital for the development of Africa. We believe that getting affordable and efficient computing in the hands of schools and enterprises in Africa will unlock a new dimension of application - of human potential, creativity, productivity and change."
A promising method is utility computing, he says, whereby computing resources are delivered as a metered service.
"This could be achievable in the future. Today we see cloud computing and virtualization technology as stepping-stones to utility computing. To deliver the future today, we have developed small islands of utility computing devices that will increase access while delivering affordable computing to users in schools, small enterprises and governments."
The word Vingu in the company's name is a hybrid of the English word virtual and the Swahili word wingu, meaning cloud.
The company's services are perfect for universities, Negga says, because they can ensure that all students have access to powerful computing very cheaply. That means they can easily connect to the school network and access files from anywhere on campus at home.
Zhou Tao, chief executive officer of VCN Corp, says the two companies had a common vision before forging their partnership.
"Negga brought some Ethiopian officials to my company for a visit and they became very interested in the desktop cloud technology, which may greatly strengthen the government's information security and centralized management capability," Zhou says.
"Then his team found this technology could be applied to nearly all business sectors, including finance, education, telecommunications, energy and manufacturing."
Given the huge potential of the African market and the relatively low connectivity in the region, Negga and Zhou agreed to share this technology and bring it to Africa.
"The vision is to set up at least one cloud access point in every African village to help them improve their education and information channel at a very low cost," Zhou says.
VCN, as the core technology and products provider, would work with Vingu to sell their technologies and products in Africa.
"I regard Africa as a significant market and my personal interest in and ties with Africa add a lot of non-commercial affection to my business in Africa," Zhou says.
"I believe if the virtual PC or cloud PC technology could be properly promoted, Africa could leapfrog directly to the cloud computing era. The technology VCN is developing is world-class and is as good as, if not better, than anything that is made in the US."
Negga says African technology companies have a lot to learn from their Chinese counterparts - for instance how to strike a balance between advanced technologies and a price point that is manageable for most people.
"Ultimately, we should not forget that technology is not an end in itself but a means to an end. Therefore, to achieve the desired and necessary impact, developing products in a way that is accessible to as many people as possible is crucial."
Chinese companies have managed to satisfy consumer demand in their own country and many may shift their focus to Africa, Zhou says.
VCN says it had had approaches from African companies on possible alliances but had never taken up the idea because it was focused on its home market, and it sees partnership with Vingu as something of a test run.
FTZ may get international board to lure yuan for gold
December 6th, 2013The Shanghai Gold Exchange plans to launch an international board in the pilot free trade zone to attract offshore yuan capital to invest in the Chinese mainland's gold market, a senior official said yesterday.
"We want to tap the opportunity from Shanghai's pilot free trade zone and launch an international board to attract offshore yuan to invest in the mainland," Xu Luode, chairman of the bourse, said at a precious metals forum in Shanghai yesterday.
The board will ensure that the onshore gold market correlates with the global market, said Xu, without disclosing a timetable for the launch.
Financial reforms in the free trade zone will allow free fund transfers between the zone and offshore markets for the first time, according to a directive issued by the People's Bank of China on Monday.
The Shanghai exchange will establish a system that publishes daily rates at which selected market participants are willing to lend gold in the mainland interbank market, which is similar to the Gold Forward Offered Rates by the London Bullion Market Association, according to Xu.
The world's biggest exchange for physical gold in Shanghai will also offer custody for the metal to retail investors.
China issues 4G licenses
December 5th, 2013China's Ministry of Industry and Information Technology (MIIT) on Wednesday issued 4G licenses to three Chinese telecom operators, marking the beginning of a new era in China's high-speed mobile network.
China Mobile, China Telecom and China Unicom received permits to offer fourth-generation (4G) mobile network services employing homegrown TD-LTE technology.
The ministry said the three companies have conducted large-scale tests of TD-LTE, or Time-Division Long-Term Evolution, one of two international standards, and their technology is ready for commercial service.
Zhang Feng, the MIIT's spokesman, said 4G technology will lower bandwidth costs and promise faster mobile broadband.
The ministry's figures showed that the Internet speed of 4G networks is 10 times that of 3G services, and allows mobile users to download a 7-megabyte music file in less than one second.
China Mobile said the rates for 4G services will be cheaper than those for 3G. In some cities where the company has launched the 4G network for trial commercial use, the tariff is 20 percent less than similar 3G network plans.
Li Yue, president of China Mobile, said the price of 4G smartphones will go down quickly following the approval of the 4G network for commercial use.
Now only a number of smartphone models in China are equipped with modules that support home-grown 4G TD-LTE technology, with their prices ranging from 350 U.S. dollars to 800 U.S. dollars.
Li said 4G terminals for as little as 150 U.S. dollars will be available on the market by the end of this year.
The MIIT also said Wednesday it will test a converged TD-LTE/LTE FDD network at a later date.
China is the major promoter of the TD-LTE standard and is also a major owner of the standard's core patents. LTE FDD is the other international 4G
standard and is popular in Europe.
The MIIT said the convergence of the two standards is gaining momentum in the global telecom industry. A total of 10 converged TD-LTE/LTE FDD commercial networks have been established so far worldwide.
"China will issue licenses for LTE FDD when the condition is ripe," said the ministry.
Experts believe the commercialization of TD-LTE will create a new impetus for China's economic growth, as the country is home to the largest number of mobile phone users in the world.
The ministry's statistics showed that the 3G network contributed 211 billion yuan (34 billion U.S. dollars) to China's GDP in its first three years of commercial use.
"The 4G industry chain, which involves terminal manufacturing and the software sector, will further improve the services of China's telecom sector," said spokesman Zhang Feng.
Why do most Chinese dislike their jobs?
December 5th, 2013Judging by the survey data, many Chinese workplaces are black holes of misery and despair.
Only 6% of Chinese employees said they are "engaged" in their jobs, according to a global Gallup survey released this month. China's numbers equal the numbers out of war-weary Iraq.
Workers across all income levels and industries were surveyed by Gallup in China, defined by Gallup to mean they were "psychologically committed to their jobs and likely to be making positive contributions to their organisations".
Out of 94 countries polled, only six countries scored lower rates of job engagement than China, including Tunisia, Israel and Syria. Unsurprisingly, 0% of Syrians admitted to being engaged at work.
In a related survey, China ranked near the bottom in a poll measuring job satisfaction among 22 Asian countries. Only 49% of Chinese respondents said they were happy in their jobs.
Part of the problem, I suspect, is that very few in China have the luxury of pursuing a career that truly interests them.
Even university graduates often feel they have no choice but to opt for positions with the government or state-run enterprises, since those jobs are thought to be stable and recession-proof.
That makes those who are happy at work in China a rare find indeed.
The BBC's ongoing My Day series tracked a typical day in a selection of people across Asia who are immersed in rewarding jobs, including some from China - a maternity nurse and a jack of all trades designer.
The latest instalment in the series tracks the work of a Chinese genealogist. Huihan Lie runs the company My China Roots in Beijing, which traces family histories and tries to put them in the context of the time.
"With every project, you find things you weren't expecting to find and the client wasn't expecting to find," he says. "Really, every person has their own little quirks and personal stories."
We'll continue to add to this series over the next few months. If you have any suggestions of interesting careers you think we should track, please add your comments below.
Online retailers seeking to change Made-in-China tag
December 4th, 2013E-commerce is considered an effective way to build a new competitive edge and avoid trade protectionism as it directly ships goods to consumers
As China's foreign trade faces rising costs at home and sluggish demand abroad, flourishing e-commerce services are expected to boost cross-border trade and change the image of Made-in-China products, experts said.
China's cross-border e-commerce companies are being confronted with challenges of credibility, varying standards, talent shortage and insufficient intellectual property rights protection.
Wang Kaiyuan, deputy director of the China International Electronic Commerce Center of the Ministry of Commerce, said at a forum on Nov 2 that the country should pay more attention to cross-border e-commerce services, which are developing in line with China's economic restructuring process.
"China's foreign trade is now facing a difficult time, not only because of a reduction in global demand but also because of rising trade friction and trade segmentation due to regional economic integration," Wang said.
Overall trade rose 6.2 percent year-on-year in 2012 and went up 7.6 percent year-on-year in the first 10 months of the year, compared with double-digit growth in the past decades, according to the General Administration of Customs.
The autumn session of this year's Canton Fair - a barometer of China's exports - posted the lowest export volume since the fair's autumn session in 2009, suggesting weak overseas demand and a grim outlook for the world's largest exporter.
"Cross-border e-commerce will be an effective way for China to build a new competitive edge as it will directly ship goods to consumers and avoid trade protectionism," Wang said.
Li Xiaogang, chief engineer of the customs agency, said that cross-border e-commerce has great significance in expanding overseas demand and transforming the country's trade developing model, as well as upgrading China's economy.
"Boosting cross-border e-commerce, especially under the current circumstances, will help small- and medium-enterprises reduce costs and solve urgent challenges such as tax rebates," Li said.
In late August, the State Council, China's cabinet, issued policies to support the development of cross-border e-commerce. Those measures include increasing payment services, easing customs inspections and improving the tax rebate regulations.
Planning for the China (Shanghai) Pilot Free Trade Zone also took into account the acceleration of cross-border e-commerce services as well as the trial of a supportive system including customs supervision, inspection and quarantine, tax rebates, and cross-border payment and logistics services.
Data from the ministry showed that the trade volume of China's cross-border e-commerce rose 25 percent to 2 trillion yuan ($328.4 billion) from 2011 to 2012. Experts estimated that the trade volume will hit 3.1 trillion yuan in 2013 and 6.5 trillion yuan in 2016, with annual growth of about 30 percent and accounting for nearly one-fifth of the country's overall trade volume.
Surging business
Zhang Guofang, chairman of Qingdao Mingyue Seaweed Group Co Ltd, said that overseas orders for the second half of the year were significantly lower than in the first half due to rising costs for raw materials, labor and fees and taxes.
"We started our cross-border e-commerce services a couple of years ago, and the new business has brought us rewards and will be our major business model in the future," Zhang said.
"We've long been a processor and supplier of seaweed products for big overseas buyers. Good quality and low prices were the major competitiveness factors, but now we're becoming a manufacturer of new products, such as cosmetics made of seaweed and we directly sell them to consumers with the help of e-commerce services.
"As the company grows, we must have our own consumer products, our own brands and sales networks. It's not easy, but e-commerce is the way forward," he added.
Xu Cheng, administrative deputy director of Bosideng International Holdings Ltd and Shanghai Bosideng International Fashion Co Ltd, said that the down clothing producer started its e-commerce services in 2008. Sales surged from around 30 million yuan in 2008 to about 400 million in 2012 and are expected to hit 500 million yuan this year.
"Cross-border e-commerce is still at an initial stage in China, but it will develop very fast as long as the trust problem is resolved," said Zhang Tianran, senior manager of Global Market Group, a global platform that connects Chinese manufacturers with overseas buyers and consumers.
A survey made by the company that polled 20,000 buyers showed that they spent more than 85 percent of their time on the platform sorting out the right suppliers as China has more than 42 million companies, according to Zhang.
"Overseas buyers don't lack information, but their main issue is sorting. The key is the credibility of domestic suppliers. The credibility issue is the most important one to change the Made-in-China image," Zhang Tianran said.
In 2005, the group launched a standard known as the Global Manufacturer Certificate, joining hands with T0 5V Rheinland AG and Underwriters Laboratories Inc. The standard evaluates Chinese manufacturers on eight areas including effective quality control, standard social and environmental responsibility and professional research teams.
"As for the M2B business, which connects Chinese manufacturers with overseas buyers, we now have 30,000 domestic manufacturers, mostly SMEs, and 1.08 million overseas buyers. The manufacturers are all the leading suppliers of different industries. When the buyers send us their full-year orders, we can get them the right suppliers within a week," Zhang said.
Challenges
Unlike China's overall trade performance in the past two years, the trade volume of Chinese companies, especially small ones, engaged in cross-border e-commerce services has maintained fast growth, said Yang Jianzheng, director of the Institute for Economic and Trade at the School of Commerce of the University of Shanghai for Science and Technology, noting a survey of 1,009 trade companies in the spring session of this year's Canton Fair.
But most companies engaged in cross-border e-commerce services have low-level logistics capabilities and poor ability to use e-commerce platforms for effective network marketing, while they remain unfamiliar with electronic customs clearance procedures, Yang said.
"We don't have enough professional talent for cross-border e-commerce, which is a big challenge. In addition, it's more difficult to protect our IPR during online transactions," Xu from Bosideng said.
Li Wenkai, director of Ecovacs Robotics (Suzhou) Co Ltd, added that the advertisement costs on e-commerce platforms are also becoming higher.
Also, Ni Zugen, chairman of Lexy Electric Appliances Co Ltd, noted that consumer loyalty is not solid for brands that made their name in the e-commerce space.
China helps expats climb the corporate ladder
December 3rd, 2013Moving your entire life to a foreign country can be hard. Finding housing, schools, medical care, not to mention a decent job, are just a few of the hurdles expats face.
Now China hopes to entice more skilled experts to its shores, by making the task of relocating and securing a dream job that little bit easier.
The newly revamped Shanghai Employment Promotion Center (SEPC) has been modeled as a one-stop-shop for foreign job seekers.
With more than 430 of the world's Top 500 companies now based in Shanghai, one step is to attract experts in short supply.
China's economic hub Shanghai is home to more than 160,000 expats. In 2013, they again ranked Shanghai as the most attractive city in China.
But while Shanghai may wow with its good looks, it's the overall package expats are looking for.
The Shanghai pilot free trade zone, launched on Sept. 29, is China's latest move in expanding economic dealings with the outside world.
Once upon a time, Chinese bureaucracies like the SEPC were little more than a rubber-stamp department, drowning applicants in mountains of paperwork.
But, at its base in Shanghai, staff here are now trying to woo workers from all corners of the world, with the benefits of grabbing a job in the city.
Ding Feng, the center director, said the center is the first port of call for companies seeking a recruitment permit, a requirement for hiring foreign workers in China.
"Foreign job-seekers could get work visas with the recruitment permit and then apply for a foreigner employment permit," Ding said.
Documents here are in English, allowing foreigners with little knowledge of the language to register for employment or extend their visa.
"This is my first time and so far it seems to be very efficient," one American job seeker told Xinhua in the bustling service hall of the center. "The staff are very helpful."
Beyond the paperwork, the center has now extended its scope to helping expats utilize educational, medical and social networks.
It's all part of the government's recent endeavour to make their departments more service-oriented. The foreign employees, who are referred to as "foreign experts" in China, are among the target population of such services.
Rose Oliver from Britain is one of them. The 49-year-old works as a professor at Shanghai University." I found it more than just a bureaucratic-like agency," Oliver said.
"It is more than an office that facilitates visas. They are actually concerned with expats' working lives, their lifestyles and the quality of life they have in China."
Oliver said it's the department's personal touch which has helped her to "have real exposure to Chinese culture".
One such personal touch are the cultural events run by the center which provide foreign experts with knowledge about living in China.
Huang Weimao, vice director of the Shanghai Municipal Bureau of Foreign Experts Affairs, said streamlining all-important social security services was another vital role. The SEPC is under the jurisdiction of the bureau.
"We have close contact with expats, to give them help with obtaining child education, medical care and even housing," Huang said.
Its help is appreciated by expats like Oliver. "They provide a lot of security."
"When we have problems, I contact Huang. We don't necessarily have daily contact. But at least there is the knowledge that they are there if you need them," Oliver said.
Besides basic medical insurance, the bureau has coordinated with a state-owned company to offer tailored medical services for expats. "Foreigners tend to have higher requirements," Huang said.
The offerings of assistance have been expanded as part of the Expats Residence Law. The law, which took effect on July 1, grants foreign workers with a bachelor degree or above, equal access to investment, government jobs, schooling, and an all-important driver's license.
Russian biologist Philip Khaytovich works in a joint scientific research center established by the Chinese Academy of Sciences and Germany's Max Planck Society.
"Before it was not clear what to do with us, because there was no legal framework to deal with foreigners, like how to provide social insurance," Khaytovich said. "Now it changed."
Khaytovich is part of China's "1,000 Foreign Talents" program, used to recruit scientists from around the world.
"I was fortunate to get into the talent program, as it provides generous support for our work. "I think this can make China a very attractive place for research."
The Bureau is responsible for the program's talent recruitment. And as the Top 500s are on the look-out for executives and managerial experts, the Bureau is helping them to do that.
Right now Huang is head-hunting experts in the ship-making, automobile, electromechanics and new materials industries.
As part of not only luring but securing expat workers, China has plans to introduce a long-term visa, to replace the working visa, which must be renewed annually.
"A lot of expats are willing to stay for a long time," said Oliver. "They aren't just coming for a year or two. "They are coming to make a life here."
Huang put it just another improvement in the pipeline. "Foreign experts require a flexible visa policy," Huang said. "The creation of the Shanghai Free Trade Zone provides a new chance for change."
Despite being the tender age of just 40, Khaytovich has already considered retiring in China. "How to deal with foreigners when they retire?" Khaytovich said. "If someone like me works here for a long time, maybe they will stay in China for the rest of their life."
The new residence law for expats has allowed foreigners to collect a pension, but Huang still admits new provisions may take some fine-tuning.
"Old-age services for elderly foreigners may prove to be new challenge for the bureau in coming years," Huang said.
Majority vote for longer Oct vacation in national poll
December 3rd, 2013Over 50 percent of respondents in an online poll have voted to keep the seven-day Spring Festival and National Day holidays.
This shows that there is a strong desire in China for people to have longer holidays than currently, a tourism expert told the Global Times Monday.
Nearly 3 million people voted online to choose from three different holiday proposals for 2014 from China's holiday authorities.
The schemes, while leaving the total number of 11 public holidays unchanged, offered options for the October 1 National Day Holiday of three, five or seven days, while leaving the Spring Festival break unchanged.
Fifty-four percent voted for the seven-day October holiday, while 27.9 percent preferred the five-day break and 18.1 percent voted for three days.
"The survey results reflect the public's desire for longer holidays," Zhang Shangzheng, a tourism professor with Anhui University said Monday.
"People prefer longer holidays for family visits or tourism to faraway destinations."
China's public holidays are too short compared to more developed countries, he noted.
Some of those who chose to keep the seven-day October break said that it was simply because there was no better choice.
Others want a return to the seven-day May Day Holiday, which was dropped in 2008 in favor of the current system of several shorter holidays throughout the year.
Many appealed to lengthen the Spring Festival holiday and to increase the total number of public holidays, the Legal Mirror reported.
The paper claimed to have an "anonymous insider" that said the final results of the holiday scheme will be published a week later.
China manufacturing exceeds market forecasts
December 2nd, 2013Manufacturing on the mainland grew more last month than analysts estimated, indicating the economic recovery is sustaining momentum amid government efforts to rein in credit growth.
The purchasing managers' index was 51.4, the National Bureau of Statistics and China Federation of Logistics and Purchasing said yesterday.
The reading was the same as in October, which was an 18-month high, and exceeded 24 out of 26 estimates in a survey.
Stability in manufacturing growth in the world's second-biggest economy may give Premier Li Keqiang more room to implement policy changes laid out after a key meeting of top Communist Party leaders last month.
While industrial investment is picking up and retail sales have increased 13 per cent so far this year, the mainland faces headwinds that include industrial overcapacity, excessive corporate debt and slower export demand.
"This is good news for policymakers, as the expected slowdown in growth appears pretty mild," said Shen Jianguang, the chief Asia economist at Mizuho Securities Asia in Hong Kong.
"As policymakers can be assured of growth over 7.5 per cent, the attention is now firmly on reform."
The stock market's Shanghai Composite Index rose 3.7 per cent last month, the biggest monthly gain since August, on optimism that the reform package outlined on November 15 will bolster the economy and corporate earnings.
Economists estimate growth in gross domestic product will slow to 7.5 per cent next year from 7.6 per cent this year. The government set a target for 7.5 per cent expansion this year, and Li said in October annual growth of 7.2 per cent was needed to keep unemployment stable.
The PMI figure contrasts with a decline to 50.4 from October's 50.9 in the preliminary reading of a separate gauge from HSBC and Markit Economics released on November 21, the final number for which is due tomorrow.
Numbers above 50 signal expansion in manufacturing, while those below point to a contraction.
The PMI for large companies in the official report rose to 52.4 from 52.3 in October, the highest level in 19 months, while the gauge for small companies slid to 48.3 from 48.5, the statistics bureau said.
"It's clear that the improvements are coming from the big enterprises, and there's little improvement in the structure" of demand, said Hu Yifan, the chief economist at Haitong International Securities in Hong Kong.
"Small companies will only recover when the overall macroeconomic situation recovers, once the economy starts to push from the bottom."
The PMI survey from the statistics bureau is based on responses from purchasing managers in 3,000 manufacturing companies. The HSBC survey is based on responses from managers at more than 420 businesses, and is weighted towards smaller private companies.
A gauge of output in the official survey rose to 54.5 from 54.4 in October, and an index of employment rose for a second month to 49.6, the highest level since March.
A measure of new orders declined to 52.3 from 52.5, and a gauge of new export orders increased to 50.6 from 50.4.
Tycoon Li Ka-shing denies pulling out of China
November 29th, 2013Hong Kong businessman and Asia's richest man Li Ka-shing denied speculation that he is withdrawing investments from markets in Hong Kong and the Chinese mainland, a media report said Thursday.
"It's a big joke that I am withdrawing capital" from Hong Kong and the Chinese mainland markets, Li Ka-shing was quoted by Guangzhou-based Nanfang Daily as saying.
Li's group sold an office building in Shanghai in October and a shopping plaza in Guangzhou in September with a combined value of around 10 billion yuan ($1.64 billion).
Commenting on these sales, Wang Shi, chairman of China Vanke Co Ltd, the largest Chinese real estate developer in terms of market value, said in his personal Weibo, the Chinese equivalent of Twitter, in September, that "it is a signal to be wary," raising market expectations about a downturn in China's commercial property market.
Hong Kong media reports said in October that Li's company will possibly sell 70 percent in equities of Hong Kong Electric Co Ltd and seek an independent listing, adding to public concern that the business tycoon is withdrawing money from Hong Kong.
Li was quoted by the Nanfang Daily as saying that his Cheung Kong (Holdings) Ltd has businesses in over 50 countries and regions, and it is a normal and strategic commercial acts for him to sell or buy assets in any of these places.
Li also noted that the registration locations for his Cheung Kong (Holdings) and Hutchison Whampoa Ltd will always be in Hong Kong, denying rumors saying Li will leave Hong Kong and transfer its investments to other global markets.
Industry watchers had optimistic attitudes about the outlook of China's commercial property markets.
"Li's selling move was just a strategic activity to cash in once he thought the return for his capital investment had hit a margin of safety," Yang Song, national director and head of commercial services at Knight Frank, a global real estate consultancy, told the Global Time Thursday.
Yang noted that buyers purchasing commercial properties sold by Li at relatively high prices also indicated that investors have confidence in prime properties in China's major cities such as Shanghai, Beijing and Guangzhou.
"Both the rents and asset prices of scarce office buildings in major Chinese cities such as Shanghai still have a room for growth," said Yang.
The number of inquires for rents of office buildings in Shanghai have increased in the third quarter, as some multinational enterprises restarted their plans of expansion in China, which is seeing an economic recovery, according to a report by Jones Lang LaSalle, a global commercial property consultancy, that was e-mailed to the Global Times Wednesday.
Talent drawn to local firms
November 28th, 2013Chinese companies are increasingly attractive to professionals: Study
China's workforce is maturing and giving priority to different aspects of corporate culture, a new survey shows.
The 2013 MRIC Talent Report by recruitment firm MRIC/MRI China Group surveyed more than 5,000 Chinese professionals and managers on the Chinese mainland, and in Hong Kong, Singapore and Taiwan.
It found that Chinese professionals were "increasingly being lured" by local corporations, as State-owned enterprises and domestic private-sector companies expand within the nation and abroad.
Chinese companies are "increasingly attractive when compared with Western (multinational corporations) in terms of career growth and development," wrote Christine Raynaud, chief executive officer of MRIC, and Angie Eagan, managing director of MRIC in China.
Chinese companies may be able to "draw on strong nationalistic sentiment" with workers because there is "pride associated with working for a Chinese company - especially one that is seen as progressive and technologically sophisticated with good career opportunities," the authors wrote.
China's economy is no longer expanding at a double-digit pace, and MRIC found that foreign companies are not investing as aggressively as previously.
Therefore, Chinese workers are realizing that "foreign companies do not necessarily offer broader roles or great job security", according to the report.
Respondents in the survey said they valued companies with clear visions for the future, which helps clarify workers' career paths.
During times of fast economic growth, companies developed "fast-track promotion" programs, but "people now realize that a title change does not necessarily mean a broader role or greater job security".
Chinese professionals are now looking for companies with effective business strategies in China that allow for long-term growth.
As businesses in China mature, MRIC noted that leadership needs have also evolved.
"When we look at the most important aspects of culture to employees (and see) the belief in fairness and promotion on merit, we begin to build a picture of the expectations that are placed on leaders in China today," MRIC said.
Asked how their company culture rates in terms of fairness and promotion on merit, 18.9 percent of workers at Chinese companies rated their companies as "poor," compared with 15.4 percent of foreign firms.
In the area of work-life balance, professionals are facing more travel and time spent working away from home, as Chinese businesses expand.
Female respondents (42 percent) said that flexibility in work is the most important aspect of work-life balance, compared with 36.3 percent of male respondents.
Among women, 25.8 percent said it is important to have regular working hours with little or no overtime, compared with 17.4 percent of male workers.
Baoshan, Shanghai set to build Asia Pacific's largest professional cruise terminal
November 28th, 2013As Shanghai builds out the Shanghai International Shipping Center and the China (Shanghai) Pilot Free Trade Zone, the city's Baoshan district is pushing ahead with the construction of its own two development zones, the Chinese Cruise Tourism Development Pilot Area and the Shanghai International Cruise Industry Development Comprehensive Reform Pilot Area.
Baoshan, the heart of which is the Wusongkou International Cruise Terminal, is developing its own cruise industry, in a move to pour new vitality into the transformation and development of Binjiang New Area.
In September of this year, the Ministry of Transport of China and the Municipal Government of Shanghai jointly published their opinions concerning the implementation of the Overall Scheme for the China (Shanghai) Pilot Free Trade Zone as a means to accelerate the establishment of the Shanghai International Shipping Center. In the document the two authorities mentioned for the first time that they encourage the development of the cruise industry and support the establishment of a port of call for cruise ships in Shanghai.
Baoshan is presently considering the proposed ways to connect the Chinese Cruise Tourism Development Pilot Area to the Free Trade Zone, including setting up cruise service firms in the Free Trade Zone jointly with foreign cruise companies; partnering in ventures such as cruise travel agencies, cruise staff training, cruise staff recruitment agencies and cruise ship materials supplies; using the experience of foreign cruise service firms in market operation; and actively extending the cruise industry chain to enhance the growth and development of Shanghai's cruise industry.
Policies such as "allowing the establishment of bonded exhibition and trade platforms in certain areas" clearly specified in the Overall Scheme for the China (Shanghai) Pilot Free Trade Zone can be applied to Binjiang New Area in Baoshan, allowing the area to set up duty-free showrooms and trade centers specially for cruise ship passengers.
Baoshan aims to become the flagship cruise terminal in China and even in Asia, by proactively connecting to the Free Trade Zone, by furnishing all the services necessary for a cruise ship's port of call as well as by building out the infrastructure needed to encourage cruise companies to choose Baoshan for their headquarters. The district plans to actively develop ancillary markets related to the cruise industry and attract cruise liner, yacht and pleasure-boat firms whose main businesses are the offering of cruise-related services.
Ultimately Baoshan intends to expand the definition of what is meant by "cruise industry", by making Binjiang the pioneer in the development of the industry in China, so that the area can rightfully become known as the "Long Beach of Shanghai" and serve as the beachhead for the development of the sector across China and even Asia. The district will also explore the best ways to set up convenient customs clearance facilities in the demonstration area, including 48-hour visa-free transit and the set-up of duty-free shops and refund offices within the area. In addition to existing routes to Japan, South Korea, Hong Kong and to Southeast Asia, long-haul routes –including some to Europe and the United States- should be launched in the future from Wusongkou terminal. Wang Hong, secretary of the CPC Shanghai Baoshan District Committee, said Baoshan is actively seeking to become a core part of Greater Shanghai in line with Shanghai's urban development planning.
The Wusongkou Interational Cruise Terminal was approved for trial operation on March 1, 2012. The design of the terminal includes 1,500 meters of frontage facing the water, two large cruise ship berths which have already been completed as part of the 774 meters of frontage that were part of the first phase of the project. The two berths can simultaneously accommodate two 200,000 tonnage cruise ships. A 514-meter approach bridge connects the terminal with its rear clearance platform. The 23,000-square meter terminal with an annual passenger throughput of 608,000 people provides comprehensive entry and exit facilities for tourists, including the passenger terminal, boarding corridor and boarding equipment and other supporting passenger service facilities.
A second phase will add two more berths and extends the terminal by 736 meters to address the berthing demands of two large cruise ships. The Wusongkou International Cruise Terminal is the largest specialized cruise terminal in terms of capabilities, the size of cruise ships served and passenger traffic. By 2014, the terminal is expected to serve 239 cruise ships and 1.15 million passengers. Wusongkou International Cruise Terminal chairman Chen Xiqi advocates the development of marine tourism, cultural and leisure activities as well as high-end hotels to create a true cruise terminal "portal" in China and a global cruise hub port.
Skype announces new partnership in China
November 27th, 2013Microsoft Corp’s online chatting arm, Skype, announced a new joint venture in China after ending its six-year partnership with Li Kashing-controlled media conglomerate Tom Group.
Skype’s new partner will be GMF, an Internet communications company co-created by Founder Group and State-owned newspaper Guangming Daily.
Details of the partnership deal were not disclosed.
The lesser-known GMF will help Skype build a good relationship with the Chinese government because of its parent companies’ backgrounds, said Judd Harcombe, head of Skype’s global market development.
He added that Skype, which specializes in online instant messaging and video call services, will launch more localized services for Chinese users in order to boost its user base.
Chen Jiandong, vice-president of Guangming Daily’s flagship website, said the joint venture will help GMF to better engage the mobile Internet market and develop new-media business.
Established in 2003, Skype has more than 300 million active users globally. It entered the China market in 2004 and achieved a sizeable user population among high-end customers.
Microsoft acquired Skype in 2010 for $8.5 billion to replace its Windows Live Messenger instant-messaging service.
Local services such as WeChat and QQ have been mounting a strong threat to the United States company since 2010. QQ is said to be the most-used online chatting service in China based on customer count. The company declined to provide a figure.
Toronto is world's most youthful city; Shanghai ranks 20th: survey
November 27th, 2013Toronto has been named the “most youthful city” in the world, while Shanghai ranked No 20, according to a new survey released on Monday.
The Canadian city was followed by Berlin and New York in the first YouthfulCities Index, a ranking of 25 global cities based on 80 indicators within 16 categories of urban life, including youth employment, financial access, economic status, civic participation, food, sports, music and art.
Toronto scored among the top five in more than half of the 16 categories and ranked No 1 for diversity.
Shanghai, which was the only Chinese city on the index, ranked fifth overall in the category of public space, sports and gaming and had the lowest youth unemployment rate among all surveyed cities.
Other youth-friendly Asian cities included Tokyo, which ranked ninth but came in first for economic status.
Seoul, the 10th most youth-friendly city, ranked first for environmental sustainability.
Some 1,600 young people aged 15 to 29 were surveyed for the index.
The aim of the survey was to “measure cities from a youth perspective”, said Youthful Cities, an organisation that helps youth and civic leaders to build better cities.
“We want to transform the insights that we gather through the Index to inspire a programme of action that allows young people to make their cities more attractive places to live, work and play,” it said.
Real estate developers hit back at claims of unpaid tax
November 26th, 2013Chinese real estate developers owed at least 3.8 trillion yuan (US$623 billion) in land appreciation tax between 2005 and 2012, according to a China Central Television report.
However, property companies hit back, with one saying the report was based on a “misunderstanding.”
Another threatened to sue.
In a weekly consumer program on Sunday, CCTV said the firms should have paid more than 4.6 trillion yuan in land taxes, but authorities collected just 800 billion yuan.
The CCTV report cited Li Jinsong, a Beijing-based lawyer and also certified public accountant and tax agent. Li had tracked data released by the National Bureau of Statistics, Ministry of Finance and State Administration of Taxation.
The CCTV report did not say how many firms were alleged to have failed to pay taxes, but said they included 45 listed Chinese property developers, trading both domestically and overseas.
In China, developers must pay tax on the increase in the value of their land when they sell properties on the land or transfer the lease.
Developers which failed to pay the tax included China Vanke Co, SOHO China Ltd, Agile Property Holdings Ltd and Guangzhou R&F Properties Co, CCTV said.
Its report said the Beijing Huayuan Group owed around 540 million yuan, SOHO China 6.4 billion yuan, and China Vanke, the country’s largest homebuilder by sales, 5.8 billion yuan.
Huayuan President Ren Zhiqiang threatened to sue CCTV.
“I only know the stupidity and ignorance of CCTV after seeing this report,” said Ren on his widely followed microblog. “It wrongly assumed company’s provision for the tax as an immediate obligation for payment of the tax. The LAT will be due after developers complete the project.”
He added: “I’m studying how to publicly prosecute CCTV.”
Li, the lawyer cited in the report, defended his claims on his microblog.
“I only know your stupidity and ignorance in the field of taxation after reading your posts,” he shot back at Ren.
“Please consult your chief financial officer before posting.”
China Vanke said yesterday that it obeyed all laws and regulations in its business operations and remained an honest taxpayer.
“The CCTV report was probably based on a misunderstanding,” Vanke told netease.com. “It mistook ‘provision’ for ‘obligation.’”
Gemdale Corp, which was said to owe 2.6 billion yuan, told the website it was “inappropriate” to use the word “owe.”
It also questioned the accuracy of data used in the CCTV report.
Last night, more than 10 real estate developers named in the CCTV report, including Gemdale, Huayuan and COFCO Property, filed statements with the country’s two stock exchanges saying that they did not owe tax.
China to see sharpest rise in salaries during 2014
November 25th, 2013Salaries across the Asia-Pacific region are set to rise an average 7% in 2014, with China and Vietnam leading the way in East Asia, after allowing for inflation and Japan seeing the smallest raises, according to an American global professional service firm, Towers Watson.
According to the survey, salaries in China are forecast to rise 8.5% and in Vietnam 11.5%, before inflation is taken into account, the global risk management and human resource consulting firm said.
It added that taking inflation into consideration both countries are set for 4.9% increase on an average. Meanwhile, the figure stands at 4.5% for Hong Kong and Singapore, 11% for India and only 2.3% for Japan.
What could be further interpreted from the findings is that many companies in the Asia-Pacific region are finding it harder to find and retain suitably skilled staff, as more than 80% of the companies surveyed say a larger portion of their salary budget increase allocation would go to high performers in 2014. Moreover, less than 1% of the companies anticipate a pay freeze, compared to nearly 4% in 2013.
Sambhav Rakyan, Global Data Services practice leader, Asia-Pacific at Towers Watson said that overall the data for 2013 and 2014 shows great similarity, which is assumable that companies should be budgeting for salary increases much in the same manner as last year.
However, he indicated that it depends on the affordability for the company. If the company is growing at a fast rate and revenue exceeds the cost by a huge margin, it is easier to be aggressive on salary budgets than low growth companies. He also noted that Employee Value Proposition (EVP) is strongly significant.
“People may say ‘it’s not about the money’, but the reality is that base pay is the number one drive for attraction and retention globally based on the Tower Watson 2012 Global Workforce Study. However, we also believe that a well-defined employee value proposition plays a very important part too”, said Rakyan.
Among the many areas that the survey looked into, the pharmaceutical sector is expected to see the biggest pay rises at 7.3% on average in 2014 for the region. While retail and media sectors are expected to see about 5.4% - 5.7% rise, down a touch from 2013.
Meanwhile, the anticipated salary rises in financial services are considered to be in an area of particular interest, given the sector has just come out of several years in the doldrums. The survey suggested that those working in the financial services sector could look forward to increases region-wide averaging 6.2%, compared to 5.7% in 2013.
The biggest raises are anticipated in China (8.8%), India (10%) and Indonesia (9%). Whereas, the major regional financial centers; Singapore, Hong Kong and Japan will see more modest raises – respectively 4%, 4.5% and 2.3%.
It is also important to note that Asia’s emerging economies, such as Indonesia, Sri Lanka and parts of Indochina, are the standard bearers for high pay increases, as these countries tend to have the highest economic growth rates of around 6%-8.5%. However, they also have the strongest inflationary pressures which take up much of those pay rises.
According to Jeffrey Tang, director of Towers Watson’s Talent and Rewards practice in Hong Kong, there are several factors that drive behind the increase of salaries throughout the region. The major ones are such as the great increase in demand for compliance staff to meet with the increased regulations and also the regional expansions by local players that seek to go beyond their domestic shores.
Hotel group IHG looking to recruit 110,000 new staff in China
November 25th, 2013Intercontinental Hotels Group (IHG) is looking to double the number of hotels it has in China in the next two years and recruit more than 110,000 employees in the country.
This is according to UK newspaper City AM, reporting comments of chief executive officer Richard Solomons yesterday (19 November) ahead of meeting with investors.
The company has already doubled Chinese hotels to 200 in the last five years.
Earlier this year the firm announced a major recruitment drive in India – albeit quite not on the scale of its Chinese plans – and last year talent manager Claire Guberg spoke of IHG’s plan to “look at internal talent first of all” as expansion continued.
Alcatel pins hopes on China 4G
November 22nd, 2013Alcatel Lucent SA's CEO says the company's selection by China Mobile Ltd as a primary supplier for the Chinese telecom operator's rollout of the world's largest high-speed wireless technology system "proves we are fulfilling the needs and requirements of Chinese telecommunications companies".
"We are proud to be part of the development of the telecommunications industry in China," Michel Combes told China Daily on the sidelines of the company's 2013 technology symposium.
Under the contract, announced during the conference in Basking Ridge, New Jersey, about 35 miles west of New York, Paris-based Alcatel-Lucent will supply Evolved Packet Core, or EPC, a framework for providing voice and data services in China Mobile's 4G long term evolution (LTE) network. Terms were not disclosed.
4G LTE is the standard for wireless communication of high-speed data for mobile phones and data terminals. Fourth-generation wireless networks achieve data download speeds of up to 80 megabits per second, four times faster than 3G networks.
The contract announcement - which will give Alcatel-Lucent a dominant 24 percent share of the Chinese telecom operator's 4G LTE network - came as Combes fleshed out a restructuring plan aimed at ending continuing losses at the company, created by Alcatel's 2006 acquisition of former AT&T Inc equipment arm Lucent Technologies.
In what he has dubbed the "Shift Plan", Combes has said he will slash 10,000 jobs globally and sell assets, while reorienting Alcatel-Lucent toward several businesses, such as cloud computing, broadband wireless networks and Internet protocol routing.
"We are all at a turning point in the industry", Combes told an audience of analysts and media at the symposium, held near Lucent's former headquarters in New Providence, New Jersey. It was there that the company's legendary R&D facility, Bell Laboratories, gave the world innovative technologies such as the laser, the transistor, and touch-tone telephone dialing. "What was working five years ago for service providers doesn't work anymore," the CEO said.
Through its ventures with China Mobile, the largest telecom operator in China with more than 750 million, or more than 60 percent, of the country's mobile subscribers, Alcatel-Lucent has played a major role in China's deployment of 4G wireless networks. As the nation moves closer to starting commercial service based on the technology, the number of applicants for 4G services is expected to surpass 100,000 in major cities, a China Mobile official told China Daily last month.
Combes said in the interview that China's leadership - which has said it is "preparing for the release of 4G licences" - has shown "a clear willingness to attract broadband services". Alcatel-Lucent is a major supplier to most of the nation's service providers, supporting such strategic industries as transportation and energy.
Rising demand in China for high-speed mobile services reflects a "clear understanding that there is direct link between investment in telecommunications and GDP growth", Combes said.
"China is keen to structure its own telecommunications industry as it reorganizes telecom as a 'sovereign industry'", he said. That's "not only because of growth in China, but because it gives it the ability to build an industry which allows it to export on a worldwide basis."
A growing appetite for services such as instant messaging also is driving demand, the CEO said.
"When you mix in the change in behavior of customers and also the (influence of) youths who run to this type of technology, that unlocks huge growth," Combes said. "On top of that you have a strong governmental commitment on the speed at which it has to be rolled out. You have all these ingredients to make it work".
China's size poses the biggest challenge in bringing high speed digital services to the country, Combes said.
At the end of the day, "China Mobile, like any customer, is looking for the best, the most talented company for them," Combes said.
Chinese mainland renews duties on Japanese, Taiwanese solvent
November 21st, 2013The Chinese mainland will continue to levy anti-dumping duties on methyl ethyl ketone (MEK), an industrial solvent, from Japan and Taiwan for another five years, the Ministry of Commerce (MOC) announced on Wednesday.
The decision was made after a one-year review and will come into effect on Thursday.
The Chinese mainland started to levy tariffs ranging from 9.6 percent to 66.4 percent on MEK from Japan, Taiwan and Singapore on Nov. 22, 2007.
When the five-year anti-dumping measures expired last year, Singapore was delisted, while the other two regions came under review.
After the review, the MOC said domestic producers may again suffer losses to MEK from Japan and Taiwan if the anti-dumping duties were lifted.
MEK is a solvent widely used in making paints, dyes and lubricants.
iPhone 5s props up Apple's market share in China, but Samsung still leads
November 21st, 2013With the arrival of the iPhone 5s, Apple regained its spot among the top five smartphone makers in China during the third quarter.
But the biggest gains in the period were made by market leader Samsung Electronics, which saw its smartphone shipments soar 156 percent year-over-year.
In China, Apple’s market share reached 8 percent as a result of a 32 percent year-over-year increase in shipments, according to research firm Canalys. Towards the end of the period in September, the company launched both its iPhone 5s and iPhone 5c models in the country.
The shipment growth gave Apple the fifth position in China’s smartphone market. In a first, the country was among the markets to receive Apple’s latest iPhone models the earliest. Previously, Chinese consumers had to wait months before the device officially arrived.
In another sign that demand has been strong, consumers buying the iPhone 5s from Apple’s China website must wait two to three weeks before the device ships out.
“I think the iPhone 5s was the main driver of the growth,” said Nicole Peng, an analyst with research firm Canalys. Demand for the phone has been so high that the gold-colored “champagne” model initially sold for 10,000 yuan (US$1,630) among unofficial sellers in China’s grey market, she added.
In another sign that demand has been strong, consumers buying the iPhone 5s from Apple’s China website must wait two to three weeks before the device ships out.
“The supply still cannot catch up with the demand,” Peng added. But whether or not the slightly cheaper iPhone 5c will catch on the market is still unclear. “I think in Q4 we will have a clearer picture,” she said. “But I expect the iPhone 5s to do very well.”
Unlike the iPhone 5s, the 5c model is readily available for order on Apple’s China website, which ships the device within a day’s time.
Peng, however, said the bigger story in the third quarter was that of Samsung, China’s largest smartphone vendor. The South Korean vendor widened its lead in the quarter to get a 21 percent market share. Trailing at second place was Lenovo, with a 13 percent share.
While Samsung may be best known for its Galaxy brand of premium smartphones, in China the company is seeing more demand for its low to mid-range handsets, Peng said.
In terms of features, many of these lower-end Samsung phones are comparable to other rival devices from local Chinese vendors. But consumers are attracted to the Samsung brand and its reputation for high quality, Peng said. In addition, Samsung has extensive retail channels in the country, and its phones are easy for buyers to find.
“Samsung has been able to stop the local players from growing as fast,” she added. “Even with the domestic vendors selling more phones, these companies have found it hard to challenge Samsung’s position.”
Behind second place Lenovo, was Yulong Computer Telecommunication with 11 percent market share. Yulong is a local handset vendor that sells phone under the “Coolpad” brand. Huawei Technologies was fourth with a 9 percent share.
Nokia China Dongguan factory employees protest their sale to Microsoft
November 20th, 2013Nokia is holding an extraordinary shareholder meeting today, where company management expects to get the approval to sell mobile device unit to Microsoft.
This being a strong emotional issue for Finns, we can expect some sort of protest both outside and inside the meeting venue later today. But there’s a group of people already in the streets and protesting Nokia/Microsoft deal. It’s the employees of Nokia Dongguan factory in China.
Apparently they too are not happy that they are being sold to Microsoft and would like to receive some compensation in the process, like their colleagues in Vietnamese Nokia factory did. Posters saying “Do not sell us, we have dignity and human rights” (according to Google translate), could be seen among protesters.
Nokia China representative confirmed the protests, but says that operation of the plant is not affected.
The Painful Reality Of Investing In China's Hospital Sector
November 19th, 2013China is desperate to draw foreign investment into its healthcare sector in general, and hospitals in particular. But thus far, the country’s need and ability to do so have been poorly aligned, with many observers wondering why it remains so difficult to make investments in China’s healthcare delivery infrastructure. Private equity investors, to name only one interested party, would love to see China’s hospital market fully open to foreign investment. But thus far, foreign approvals have been few and far between, and deal flow has been slower than many anticipated. This has all left industry watchers wondering what to make: why does it remain so hard to deploy capital in China’s hospital sector? Many assumed the process by which the hospital sector opened to foreign investment would follow a similar trajectory as other industries that were previously closed, but then opened to foreign direct investment (FDI). Now, questions are being raised about whether this assumption is accurate; if not, why; and, what a more realistic set of expectations should be about where foreign capital will be allowed to invest in China’s healthcare system.
In 2011, China announced its intentions to revise the country’s FDI catalog to allow for wholly foreign owned entities (WFOE) of hospitals. This move would have relaxed China’s historical stance on FDI into the hospital sector that had previously forced foreign capital into joint-venture agreements with a Chinese counterpart. Investors had long wanted to see China relax limitations on FDI into this part of the country’s healthcare system in particular. Most analysts pointed to this step as the first in a series of changes that would ultimately allow investors to make aggressive moves within China’s burgeoning private hospital space. Coming on the heels of China’s Ministry of Health making it possible for the privatization of public hospitals, it seemed the moment had finally arrived when foreign capital could go to work in the country’s hospital sector.
Overall, most people anticipated the reform trajectory for hospital investments would look a lot like what had occurred with other industries in China: a series of gradual reforms that began by moving hospitals out of the “restricted” FDI category, then allowing Chinese-foreign joint ventures, gradually increasing the equity a foreign company could have, allowing 100% foreign ownership as long as the holding company was from somewhere like Hong Kong, Macao, etc. and then ultimately 100% foreign ownership regardless of country-of-origin. Thus far, the process of gradual opening for the hospital segment has limped along, fostered most recently by the announcement from China’s State Council in mid-October that further relaxed regulations surrounding private investment in Chinese hospitals. The most recent announcement, while reflecting the government’s ongoing aspiration to draw FDI into the market, had little new to say other than allowing greater freedom for privately owned hospitals to set their own prices and that for-profit private hospitals could apply to receive discounted tax rates. Both are helpful adjustments that add further hope to the idea that China is working to make it easier and more attractive for foreigners to invest in the country’s hospital industry.
Yet, it remains incredibly difficult to invest in China’s hospital space. Most people who have been working in the sector for the last several years will express emotions ranging from dismay to anger over how challenging it is to navigate the country’s maze of regulators and approval agencies. What keeps hold on those investors with the stamina to stick it out is the belief that western entrants will bring products, technologies, care plans and service standards that will easily capture meaningful market share, especially in China’s growing middle class. This group also happens to be the demographic cohort the Chinese government would most like to see the private sector play a more significant role helping provide healthcare for. The handful of successful privately-owned entrants in China’s hospital market prove that patience will be rewarded, and that Chinese healthcare consumers understand and value western care; however, the small number of these successful operators also point towards the painful reality that getting deals done in China remains an enormous challenge.
Some of this difficulty has nothing to do with investing specifically in Chinese hospitals, and everything to do with how rules and regulations that allow more foreign investment in any category are interpreted by local authorities. Some municipalities are eager to see foreign investment, while others may be more concerned about political risk. This is not unique to hospitals; it captures a typical frustration on the part of foreigners who do not fully appreciate that in China, “the mountains are high, and the emperor is far away,” a statement the Chinese use to point out how hard it has always been is for any government across China’s history to get local authorities to do what they want. But some of the difficulty foreigners are encountering as they navigate China’s hospital industry is also a reflection of the simple truth that healthcare in China is a politically sensitive area. As such, the government is moving deliberately and slowly, to make sure that it does not destabilize the public hospital system through a series of reforms that, while good in the short-term for private operators and investors, might cause mid-term problems for the government. During a recent conference in Shanghai, I moderated a panel and asked my fellow speakers if there was any analog industry in China that was as politically sensitive that had ultimately gone through a similar process of opening to foreign investment. Every one of the panelists shook their head “no.”
In the aftermath of this summer’s GSK scandal, this point has been made very clear to foreign investors: healthcare in China is going to be an extremely political issue. Yes, healthcare anywhere always has a political dimension to it, as this week’s back-and-forth in Washington DC over the Affordable Care Act makes all too obvious. But healthcare is even more of a touchy issue in China. For years, Chinese have absorbed terrible pollution, tainted food supplies, and contaminated water. They have done this with the knowledge that for many, the result will be cancer and cardiac disease; however, the price was one they were willing to pay. The hope was that all of these costs would be offset with a growing and vibrant economy that, among other benefits, would foster a modern healthcare and pension system. The simple and painful reality that Chinese people are coming to terms with today is that the country’s healthcare system remains badly out of sync with the demands that are already being put on it, not to mention those strains that will soon exponentially increase as China’s demographic dividend comes to an abrupt end, leaving a rapidly growing number of Chinese who need care for long-term chronic diseases.
The Chinese government understands these pressures all too well. They are equally aware, and troubled by, the realization that to-date the bulk of China’s hospital sector has been controlled by the central government. This has an obvious implication: as frustrations mount, the government is going to be the entity that people blame. This realization has no-doubt driven much of the government’s recent policy adjustments that have diligently worked to make it easier to bring FDI into the country’s healthcare delivery system. The painful reality is that China has three factors coming together that are likely to make it more difficult to fundamentally alter the quality of either healthcare outcomes or customer experience. First, the country’s economy is encountering new headwinds that, among other things, threaten to force the central government to take precious resources away from healthcare investments. Second, the government needs to pull two things off pretty much at the same time: increase capacity (as measured by new hospitals, primary care outlets, expanded national insurance coverage, new drugs, devices and diagnostics) and absorb the costs related to a rapidly aging society characterized by long-term chronic diseases. Third, China is opening its healthcare economy to foreign investment relatively late in its economic liberalization and modernization. Consequently, even though the government feels it needs to be very cautious in its approach, it has to address the chorus of voices from foreign operators who want to make investments more smoothly and quickly, alongside the frustrations of average Chinese who want more coverage and better choices now.
The reform and opening process China is engaged with in its hospital sector is not unique. The stages have thus far roughly followed the sequence of what other previously restricted sectors have gone through. What is different is the pace and timing. In the midst of China’s amazing economic successes, it has only now begun to turn its attention towards making the hospital industry more amenable to foreign investment. While China’s concerns about moving too quickly are understandable, the political and social risks attached to moving too slowly are beginning to mount. Of all the sectors China has moved to open for overseas investment, its healthcare economy in general, and hospitals especially, may need to move more quickly than the authorities would like. The balance between control and flexibility has never been easy in China, but country’s healthcare system cries out for the sort of focused, concerted and expedited effort that China has proven capable of in the past, and must be again today.
Coca-Cola plans more than $4B investment in China
November 15th, 2013Coca-Cola says it plans to invest more than $4 billion in China over three years.
David Brooks, president of Coca-Cola’s Greater China and Korea business unit, told Bloomberg earlier this week that the company plans to invest the money between 2015 and 2017 to build factories and add new products to its portfolio. The company is also investing $4 billion in China between 2012 and 2014.
Coca-Cola has been expanding in emerging markets such as Russia and China. It aims to reach $200 billion in revenue by 2020, in part by catering to the rising middle class in emerging markets.
Shares fell a penny to $39.82 in midday trading. The stock has risen 10 percent since the beginning of the year.
China's crazy property bubble
November 14th, 2013Cui Shufeng is a retired government worker in Beijing. She is one of the lucky homeowners who bought her place long before the housing sector galloped out of reach for the average Chinese salary worker.
"It is ridiculously high," she says pointing to apartments in her neighborhood. "These homes near the school here are CNY 70,000 (USD$11,400) per square meter. It's not even worth 7000 yuan (USD$ 1140) per square meter because it's not even good quality."
Her concern is on the radar of the central leadership that is expected to discuss economic reforms at the plenary session starting Saturday. For Chinese leaders, the property sector is an emotional and political hot potato. The dream to own a home is a far out of reach for tens of millions of Chinese citizens.
In the latest housing data, new home prices for September rose at the fastest pace in almost three years. In Beijing, new home prices were up 16%, Shanghai 17% and Shenzhen 20% from a year ago.
"The problem is Chinese people have very few investment vehicles. They've lost trust in the stock market so they turn to real estate," says Xu Si Tao, China Director of the Economist Intelligence Unit.
Xu says the central leadership needs to make bold steps in financial reforms to give citizens more options to invest their money.
One measure China is considering is to allow banks to set their own interest rates, creating more competition.
I was in Beijing two weeks ago and visited a luxury villa compound. It was a large site with tens of dozens of completed but mostly empty villas. A worker in the sales office told me the average home was priced at CNY 23 million (USD$3.8 million) and most were sold. He said half were owner-occupied (though I saw very little sign of residents) and the other half purchased as investments.
I was told the supermarket in the center of the compound was open and often used by residents. It was clearly still under construction. When I pointed this out, I was then told the grand opening would be next year. Message: The bubble is alive and growing. These villas are a pretty -- and by most appearances, empty -- place to park money.
Cui shakes her head at the dilemma facing the government. She doesn't believe recent curbs will work like a ban on third home loans in Shanghai.
"I don't think home prices will drop sharply because our economy is still doing okay," she says. "Our child bought a home in the U.S. recently. The price was about the same as a flat in Beijing, but the area is a lot bigger and the quality is much better."
Beijing announces list for Nobel-hunting talent recruitment
November 14th, 2013The Chinese government has announced a list of professional elites that it plans to include in its talent recruitment program — the 10,000 Plan — which aims to provide financial, policy and service support to 10,000 science and technology professionals in China, reports the Hong Kong-based Wen Wei Po newspaper.
The 10,000 Plan plans to recruit 100 world-class scientists that have the potential to win coveted Nobel prizes, 8,000 professionals much needed for China's technology sectors such as innovators, entrepreneurs, philosophy and social science majors and educators, as well as 2,000 young people under the age of 35 with great potential in other areas.
The organization department of the Communist Party's Central Committee oversaw the propaganda department, the Ministry of Education and the Ministry of Science and Technology in implementing the program, which had its launch in September last year.
A number of talents have been listed in the program since July of this year, which includes six scientists, 72 technological innovators, 199 "young people with great potential," 201 technology entrepreneurs, 94 philosophy and social science specialists, 101 educators and 98 engineering experts.
Beijing plans to provide 1 million yuan (US$164,000) in financial support to each of the individuals to carry out research, freeing them from administrative hassles such as applying for grants. The central government will also provide policy and service support.
The program is a successor of the 1,000 Plan, also a recruitment program which launched at the end of 2008. The program has successfully recruited 4,000 individuals at home and abroad including 40 top scientists from developed countries.
Six high-profile scientists have been included in the 10,000 Plan: Liu Zhongfan is a researcher with the Chinese Academy of Science who has made a series of breakthroughs in his research on low-dimension carbon materials; Xue Qikun, also a member of the academy known for his research on scanning tunneling microscopy; Wang Yifang, president of the Institute of High Energy Physics of the academy; Zhou Zhonghe, a Chinese Academy of Science researcher who is an expert in bird evolution; Lu Ke, also a researcher with the academy who specializes in applying nanotechnology on metal surfaces; and Ma Yongsheng, a researcher with the Chinese Academy of Engineering who has carried out research on oil and natural gas resources and their exploration.
Chinese internet users were skeptical however that Nobel prizes could be "attacked" in this way and criticized the government for treating the awards like the country's sports program treats the Olympic Games, adding that the six scientists named on the list do not carry out their research with the sole aim of winning a Nobel. One of them, Zhou Zhonghe, said people should not focus on the prestige of winning the awards but rather the overall improvement of China's scientific skills and urged the country's society to avoid seeking the appearance of success in the short term, according to the Chinese-language Beijing Times.
Jobless Growth In China? Employment Stats Say Recession Has Already Started
November 13th, 2013Li Keqiang, in a speech released last week, said a 7.2% annual increase in China’s gross domestic product creates 10 million new jobs a year. The premier, therefore, believes each percentage point of growth produces 1.4 million jobs.
Morgan Stanley’s Ruchir Sharma, writing in the Wall Street Journal just before the release of Li’s speech, told us that each percentage point of growth results in 1.6 million to 1.7 million new jobs.
Beijing’s National Bureau of Statistics reported that last year China’s GDP jumped 7.7%. Applying Sharma’s formula, the economy should have created 12.3 to 13.1 million new jobs in 2012. Applying Premier Li’s formula, the number is 10.8 million new jobs.
So how many jobs were in fact created last year? The Ministry of Human Resources and Social Security reported that 767.04 million working-age Chinese—those aged 15 to 59—were employed in 2012, 2.84 million more than in 2011. In other words, the number of jobs increased 0.37% last year at a time when gross domestic product grew, according to NBS, 7.7%.
What makes this even more interesting is that China’s services sector, an obvious job-creator, is expanding fast according to NBS. Services accounted for 44.6% of GDP last year, up from 41.9% in 2011. Output from services grew 8.1% in 2012, a pace faster than GDP.
These figures are hard to reconcile. How can an economy growing in the high single digits with a quickly expanding services sector create so few jobs? There is no iron correlation between GDP growth and employment creation, but the two cannot be this far out of whack in an economy like China’s that has already passed its initial stage of development. In China, economic growth and employment should more or less move in step.
So how fast did China expand last year? Working back from the Human Resources Ministry statistics, the Chinese economy grew 2.0% last year if Premier Li’s formula is correct. It grew 1.7% to 1.8% according to Sharma’s relationship between growth and jobs.
And how fast is China growing now? In 88 cities surveyed by the Human Resources Ministry, the number of available jobs—termed “demand for workforce”—in the third quarter of this year fell by 139,000 (2.5%) from the third quarter of 2012. In 95 surveyed cities, the number of available jobs in the July-September period decreased by 232,000—4.0%—from the second quarter of this year.
Employment data for the third quarter is still fragmentary, but it is consistent with anecdotal evidence from China’s jobs market. For instance, observers report that this year is the toughest hiring season ever. College graduates have even been hired and fired in the same month as employers realized they did not need new hires.
Of course, job-creation numbers are not the only data points available. They are, however, generally consistent with private surveys, such as the China Beige Book and the widely watched HSBC purchasing managers’ manufacturing index.
The National Bureau of Statistics, on the other hand, has issued Q3 figures showing a robust economy, 7.8% growth in the period. Yet Premier Li Keqiang just-released speech on jobs contains a formula that undermines NBS’s creditability, and job creation numbers from the Human Resources Ministry show an economy that from last year to last quarter is moving from a state of low growth to one of contraction.
Online shopping records beaten in China as new era beckons
November 13th, 2013During a meeting with China's premier, Li Keqiang, two weeks ago, Alibaba's founder and chairman Jack Ma made a bold prediction: "We expect 30-billion-yuan-plus (US$4.9 billion) in online turnover on Nov. 11."
Taobao.com and Tmall.com, key sales platforms under the Alibaba Group, operator of China's biggest e-commerce platforms, offered big discounts throughout Monday, or Singles' Day.
By 1:04pm, after 13 hours of sales, turnover stood at 19.1 billion yuan (US$3.1 billion). The amount was the same for the whole of Singles Day last year.
By 9:19pm, turnover exceeded 30 billion yuan, Ma's stated goal.
"Many products sold out in a flash," said Xu Yun, 24, who stayed up till 3am and spent 2,800 yuan (US$460) on clothes and cosmetics, at a discount of 50%. "I have bought enough for the upcoming winter," Xu said.
Sales surpassed 100 million yuan (US$16.4 million) less than a minute after the sale started at midnight. More than 10 million people like Xu were waiting to start shopping.
Singles' Day, on Nov. 11, became popular after Alibaba tagged it China's version to Cyber Monday.
"Under the surface of buying products at a lower price, the public are actually enjoying the benefits brought by market-oriented progresses in logistics, financial environment and e-commerce," said Ma.
Alibaba saw a whopping 1 trillion yuan (US$164 billion) in turnover last year, more than eBay and Amazon combined.
In 2012, China's online retail sales volume reached 1.3 trillion yuan (US$213 billion). It took only nine months for the country's online shops to break the record this year. China is poised to surpass the US to become the world's largest e-commerce market.
Consumption gained momentum after new guidelines in mid-August. Internet-based consumption is expected to grow at least 30% annually to 2.4 trillion yuan (US$394 billion) by the end of 2015.
This year, shoppers have been attracted by online-to-offline (O2O). Shopping malls have been working with e-commerce giants to allow customers to try products in real stores and then purchase them online, offering a more streamlined shopping experience.
Consumption is expected to grow faster as China will soon issue the fourth generation network mobile communications and technology (4G) license. This will make mobile Internet shopping even more convenient.
Behind the online shopping malls are over 5,000 Alibaba staff and hundreds of other workers in payment, telecommunication, internet maintenance and express service departments trying to provide a slick service.
According to Ma, about 9 million online shops have set up business on their platforms. This has led to thousands of jobs as well as a boost for logistics and express delivery companies.
In late October, China's Cabinet relaxed company registration requirements to ease market access and encourage social investment, giving support to small businesses like those on Alibaba's e-commerce platforms.
Premier Li expressed support for the country's burgeoning private enterprises and advocated reforms for a consumption-driven new economy during a conference, which Ma was invited to late last month.
"It is not only that the government trusts private entrepreneurs, it also relies on them," Li said.
However, it is not only down to trust.
The thriving e-commerce business is made possible by more Internet finance innovations such as third party payment platforms and small loans.
Thanks to increased investment borrowed from renrendai.com, a peer-to-peer (P2P) online lending platform, Yang Zhiming, a razor retailer on Taobao.com, doubled his sales on Monday.
Yang is one of the thousands of small business owners who has benefited from Internet-based micro finance. They had been turned away by major banks due to small scale and insufficient credit record.
More private enterprises are making their foray into the once heavily regulated financial sector, offering small and medium enterprises more financing choices.
"The internet finance boom forced China's state-owned finance giants to rethink their development strategy, putting more focus on small businesses and enhancing the country's credit system construction," said Yang Tao, a senior finance researcher with Chinese Academy of Social Sciences.
Xu Yun said she is looking forward to receiving her products, but is worried how long they will take to arrive and whether they will be in tact.
Last year, an avalanche of deals and parcels almost paralyzed the payment system and logistics, while customer complaints challenged the consumer protection legal system.
"China's logistics sector is small in scale and too fragmented," said He Dengcai, deputy director of China Federation of Logistics and Purchasing.
He encouraged more enterprises to outsource their logistics demands to help reduce costs and improve services.
Online payment services are also reported to falter when there are high numbers of transactions. "More payment channels and a safer purchasing system should be developed to ease online shopping," said Yang Tao.
That may be changing.
Premier Li has said the government will continue to improve public service infrastructures and systems to facilitate market-oriented reform.
"The process of reform may be gradual, but it is determined," he said.
Positive economic growth expected to continue
November 12th, 2013China's stable economic development in October strengthened economists' expectations of a "happy ending" to the year, with industrial and service sectors progressing amid moderate inflation.
The National Bureau of Statistics reported on Saturday that October's industrial output reached 10.3 percent compared with 10.2 percent in September. The increase was higher than the market had expected and was led by manufacturing, which increased 11.4 percent from a year earlier.
Retail sales of consumer goods rose by 13.3 percent - the same rate as in September.
Fixed-asset investment, which has been the backbone of the world's second-largest economy in withstanding the global financial crisis, moderated slightly during the first 10 months to a growth rate of 20.1 percent, compared with 20.2 percent from January to September.
HSBC's Chief China Economist Qu Hongbin said there is no signal hinting at an economic slowdown in the fourth quarter, which departs from earlier expectations.
"The economic situation will not be worse in the last two months," he said.
Meanwhile, consumer inflation in October increased at a rate of 3.2 percent, compared with 3.1 percent in September. The rise was mainly caused by the 6.5 percent increase in food prices, the NBS reported.
In the first 10 months, the Consumer Price Index average was 2.6 percent, which is lower than the 2.7 percent during the same period last year.
The Producer Price Index, an indicator of industrial inflation, dropped faster in October, by 1.5 percent. It declined by 1.3 percent year-on-year in September.
Industrial Bank's Chief Economist Lu Zhenwei said consumer inflation is expected to remain moderate for the last quarter, and there is no need to worry about inflation pressure this year. However, industrial enterprises still face great pressure from excess production capacity, indicated by the continually softening out-the-factory-gate prices.
"Maybe the upward turning point of the economy still has to wait," Lu said.
As overall inflation has remained at a relatively low level, the current monetary policy is expected to remain unchanged, economists said.
"But some fine-tuning of the open-market operation may be needed to hedge capital inflows into the country," said Qu from HSBC.
In addition to positive short-term economic growth expectations, economists greatly anticipate the long-term balancing of development and structural reform.
They agreed that a 7 to 8 percent GDP growth will be a "normal speed" for China in the next decade - a shift away from the previous double-digit rates.
On the same day the NBS released the October economic indicators, a meeting of the country's top leaders to discuss the reform agenda for the next five to 10 years began in Beijing.
The leadership will try to push more sustainable growth and find ways to smoothly transform the development mode into a consumption-driven model.
UBS' Chief China Economist Wang Tao said: "We expect more tangible progress in service-sector deregulation, social welfare-system reform and financial-sector reforms in the next couple of years.
"But we think major breakthroughs in fiscal, land and State-owned enterprise reforms will be unlikely in the near future."
Over 100,000 apply for army civilian posts
November 11th, 2013More than 100,000 people, most holding bachelor's degrees or higher, applied online for army civilian posts during the October 22 to November 5 window for applications, the Chinese People's Liberation Army (PLA) said on Sunday.
One out of every 38 candidates will be recruited, the PLA General Political Department said, with the test to be held on December 15.
This is the PLA's first unified recruitment of army civilian personnel from the public, a move to attract talents and improve employment transparency.
The army civilian posts cover professional and technical stations, including teaching, scientific research, engineering, health, culture, sports and libraries, as well as non-professional posts such as management and logistics services.
Shoppers warned about sale scams
November 11th, 2013The city's consumer rights advocate warned shoppers to be wary of tricks that online stores might employ Monday during the annual Singles' Day sales on the shopping websites taobao.com and tmall.com.
The Shanghai Consumer Council issued the warning ahead of what has become one of the busiest online shopping days of the year in China, the equivalent of "Cyber Monday" in the US. Taobao.com and tmall.com sold more than 19.1 billion yuan ($3.14 billion) in goods on November 11, 2012, up about 72 percent from the previous year's sales, according to Alibaba Group, which owns the two websites.
In its warning to consumers, the consumer council said that some online stores on the sites might raise their prices in advance of the sale so they can claim to be offering larger discounts Monday.
Consumers should also be on the lookout for stores that replace products with poorer quality items, according to a press release from the Shanghai Consumer Council. The counsel stressed that consumers need to pay more attention to the quality of the products, as opposed to the size of the discounts.
The consumer council also warned shoppers that some stores might sell more goods than they have in stock and then tell buyers that they can't fill their orders unless they pay more money. The stores usually offer excuses such as computer problems or employee negligence.
The council said that it isn't easy for stores to accidently oversell a product because their inventory is computerized.
Consumers should also expect delivery delays for the items they buy Monday as most courier services will be running at near capacity. After last year's sale, some customers complained that it took a week or longer for their purchases to be delivered. The council advised consumers to shop elsewhere if they need something immediately.
The city's commerce authority advised consumers to call its 12315 hotline if they run into any online shopping scams. The Shanghai Administration for Industry and Commerce said it will send officials to monitor advertisements and will punish stores that try to trick consumers.
China Needs 7.2% GDP Growth for Jobs, Says Premier
November 6th, 2013Thanks to the Workers’ Daily, we now know a little bit more about how Chinese economic growth translates into jobs creation—or at least how top Chinese officials view that crucial equation.
Speaking at a national congress for China’s official trade union two weeks ago, Premier Li Keqiang said that China needs economic growth of at least 7.2 percent in order to ensure adequate employment, the Beijing-based newspaper reported on Nov 4. “The reason why we want to stabilize growth, in the final analysis, is to preserve jobs,” Li said at the union meeting on Oct. 21.
Li’s comment contrasts with the once oft-intoned rallying cry of “bao ba” or “protect eight,” meaning China must ensure growth does not fall below 8 percent in large part to ensure adequate employment. That mantra was common among Chinese policymakers until just a couple of years ago.
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Now with gross domestic product growth of 7.2 percent, China can create 10 million new jobs annually and ensure that registered urban unemployment is around 4 percent, Li said. (Keep in mind that the official figure is of limited value in measuring China’s true unemployment rate, given high numbers of migrant workers and others that aren’t counted in the official rate. We wrote about that earlier here.)
Li also pointed out how important the rest of the world remains for ensuring adequate employment in China. All told, China has some 30 million workers who are directly dependent on China’s export industries, and an additional 100 million serving in supporting industries, Li said. “If exports fall rapidly, it will create an employment problem,” he said.
Li said however, that the Chinese economy today is doing better at making jobs. While in the past, one percentage point of GDP growth created about one million new employment opportunities, today the same gain in China can create from 1.3 to 1.5 million new jobs.
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That’s because of economic restructuring—and particularly, the development of the job-producing service sector, Li noted. Over the last decade, China has grown its service industries from 41 percent of the economy to about 45 percent now. And China has an official goal of raising it to 47 percent by 2015. Still that’s probably too low. “Compared to countries with a similar income level, the proportion of GDP made up by the service sector lags by probably 10 percentage points,” Li said. “As a big country, in China we still must rely the most on domestic demand.”
Overseas degree no guarantee of higher salary in China
November 6th, 2013Chinese students possessing a degree from an overseas university do not necessarily receive a similar wage when seeking jobs at home, with a huge gap of up to 100,000 yuan (US$16,400) existing between them, a recent survey shows.
Their salaries are instead determined by their work experience during their time abroad, a survey conducted by the Beijing-based EIC International Education revealed.
The survey found that a Chinese job seeker with less than five years of overseas work experience receives an annual salary of 165,000 yuan (US$27,100), while individuals with at least five years working experience abroad can command a salary of up to 267,100 yuan (US$43,900) a year.
Most of the positions offered by Chinese companies do not specify a requirement for a domestic degree or a foreign degree, the EIC International Education said, while 62% of recruiters placed greater emphasis on a candidate's professional skills when hiring rather than merely whether they hold a foreign diploma. Around 84% of the Chinese firms polled stated that they considered job seekers who had overseas experience, innovative abilities and proficiency in a foreign language.
It is not an easy task for Chinese students to find work overseas, however. A total of 38.9% of the respondents said the major obstacle they faced while looking for jobs in a foreign country was the prevailing local economic situation. Moreover, their possession or lack of cross-cultural social abilities also affected their chances of working abroad, accounting for 33.6% of the total polled respondents.
Meanwhile, the dropout rate of Chinese students at Ivy League schools in the US, including Harvard, Yale, Cornell and Columbia was as high as 25% this year, according to Li Zhu, president of EIC International Education. Li said that some Chinese students are unable to adapt to the educational system and the language requirements in western countries.
The survey was conducted over a nearly six-month period. A total of 9,173 valid responses were collected from industries, such as finance, education, healthcare, real estate, tourism and science in 23 cities across China, including Beijing, Shanghai, Guangzhou and Shenyang.
Online jobs marketplace used by China’s web giants gets $2.5 million funding from Innovation Works
November 5th, 2013Chinese IT job listing website Neitui today announced it received RMB 2.5 million ($410,000) investment from Innovation Works, bringing the company’s total valuation to RMB $10 million ($1.64 million). The funds will be used to expand the current three-member team.
The website lists IT jobs from China’s most high-profile tech companies: Alibaba, Baidu (NASDAQ:BIDU), Tencent (HKG:0700), Sina (NASDAQ:SINA), Sohu (NASDAQ:SOHU), Renren (NYSE:RENN), and dozens more.
Neitui was founded by two former Shanda Games (NASDAQ:GAME) employees. It features an internal recommendation system that verifies headhunter profiles and limits the number of job posts to avoid spam and scams. It also let’s users contact potential employers through the company’s WeChat account, email, and private messaging to lessen its own role as the middle man.
Neitui has about 20,000 registered users with 4,000 to 5,000 unique veiws per day. More than 1,700 job seekers have posted their resumes, and the website has done very little marketing or promotion.
Recruitment services targeted at specific verticals are a growing trend in China, exemplified by websites like Nashangban, Lagou, and Renren Headhunting.
More students back from abroad
November 5th, 2013The number of Chinese students returning from overseas is set to exceed those going abroad within the next five years, a survey released on Monday shows.
The report by the Chinese Academy of Social Sciences on Chinese talent returning home said the number coming back has continued to increase since 2004.
By 2018, the balance is likely to tilt in favor of the returnees.
Last year, about 2.6 million Chinese went overseas for education, training or on exchange programs, compared with more than 1 million who returned from abroad.
The most popular cities where those returning chose to stay were Beijing, Shanghai and Guangzhou.
To attract more talent from abroad, many cities have offered favorable policies on housing, children's education and spouses' jobs.
The report says more than 60 percent of those returning found jobs within six months. Some 25 percent were hired by foreign companies and their branches in China, with the finance sector being the biggest attraction.
"The younger generation feels comfortable living in China after studying overseas, because it would be very difficult for them to merge into mainstream society in a foreign country," said Xia Yingqi, 64, chief adviser at the Beijing Overseas Chinese Talent Center.
Xia was among the first batch of students sent overseas by the government. He studied in Canada from 1978 to 1987, gaining a doctorate degree in engineering. He said there were only 5,000 Chinese students in Canada then, compared with at least 500,000 now.
Liu Yuxuan, 28, a PhD candidate at a university in the Netherlands studying the pathogenesis of hematological cancer, said, "It feels so good to be back home." She wants to return to Beijing after graduating in December.
She said students returning from overseas enjoy many preferential government policies in China, and she, as a medical researcher, can make the best use of her knowledge at home.
But despite the increasing number of students returning from overseas, the cream of them — those with doctorate degrees in science or engineering — are still unwilling to come back.
Statistics from the Organization for Economic Cooperation and Development show that from 1990 to 1999 nearly 90 percent of overseas Chinese students falling into this category chose to stay abroad. The situation shows no sign of changing.
The Chinese Academy of Social Sciences' report said more than half of the Chinese who returned from overseas in 2012 were undergraduates.
They studied mostly in Britain, where the requirements for overseas graduates who want to stay are stricter than in many other countries, including the United States.
Rui Zi, 30, whose husband gained a doctorate degree in engineering in the US, said: "I think I will stay in the United States for at least the next decade. I enjoy the free social benefits and better public services. At least we have fresh air here and not so many people."
Xia said that most of his younger friends who went overseas as the country's top students are staying aboard.
His 34-year-old son gained a master's degree in Britain. "But he loves Beijing. I persuaded him to stay in the UK, but then he insisted on coming back because he could not stand the sense of loneliness in a foreign country."
Li Wei, a professor at Arizona State University, said more Chinese parents want to send their children to study in the United States for a bachelor's degree. She said the number of Chinese students studying for such degrees in the US increased from 8,000 in 2000 to 30,000 in 2010.
"The number of those seeking postgraduate studies is growing slowly," she said.
Britain, the US and Australia are the top three destinations for Chinese students going abroad, the academy's report said.
Alcatel-Lucent to lay off 10,000 workers by 2015
November 1st, 2013Telecom equipment maker Alcatel-Lucent unveiled plans Oct.8 to cut about 10,000 jobs worldwide by end-2015 in a cost-cutting drive to save 1 billion euros ($1.36 billion) and reverse years of losses.
The company intends to axe 4,100 posts in Europe, the Middle East and Africa, 3,800 in Asia Pacific, and 2,100 in the Americas, it said ahead of a meeting with its European works council Oct.8.
Alcatel announced in June the “Shift Plan” to focus on networking products and high-speed broadband and lower fixed costs by more than 15 percent, but it had yet to detail job cuts.
“The Shift Plan is about the company regaining control of its destiny,” Chief Executive Michel Combes said in a statement.
Shares in Alcatel rose 2 percent in early trading and were up 1.4 percent at 2.927 euros by 0712 GMT. The stock has almost tripled in value this year, with hopes that Combes can turn around the business.
The group, which employs 72,000 staff worldwide and competes with larger rivals Ericsson, of Sweden, China’sHuawei and Finland’s Nokia, has posted five straight quarters of net losses.
Last year it swung to a net loss of 1.2 billion euros - the biggest since 2008 - largely because of a writedown on its mobile unit and restructuring costs from an earlier plan to lay off 5,000 workers.
Alcatel confirmed it would dedicate 85 percent of its research and development budget in 2015 to next-generation technologies, up from 65 percent today. Spending on older technologies would be cut by 60 percent.
By the end of 2015, Alcatel will halve the number of its business hubs globally, it added.
The layoff plan is the latest in a series at Alcatel-Lucent. In autumn 2012, it announced moves to trim 5,000 workers from its base of 76,000 at the time, with the heaviest burden falling in France.
Vancl to follow Xiaomi's model, laying off 20% of staff
November 1st, 2013Vancl has faced a rough two years. Now Lei Jun, founder of Xiaomi, may take over Vancl and could even replace its current CEO and founder, according to Tencent's technology news portal.
The trouble began when the online retailer started cutting inventory last year. Now it has become one of the main platforms to dump excess inventory.
In May, Vancl tried to introduce third-party brands into its channels. In September, it tried to become its own brand. The industry began to wonder: is Vancl a product brand or a channel brand?
Since June, major investors in Vancl's board meetings have repeatedly questioned its direction and strategy, with CEO Chen Nian finally deciding to stick with starting its own brand of apparel, the report said, citing unnamed insiders.
Chen has consulted with Lei several times since June, whose ideas and his unqiue way to run Xiaomi have been stimulating to Chen, the Vancl CEO told the tech site. "Lei's advice has a direct impact on Vancl's following adjustments," Chen said.
Vancl recently moved headquarters to a Beijing suburb from the downtown district, cutting rent from six yuan per square meter to just one yuan. Along with the move, Chen integrated the company's three business units into one — resulting in the layoff or early retirement of 20% of its staff. During the process, Vancl delayed payments to its suppliers, the report said.
Chen said investors have given him pressure on him, but not to the point of replacing him. Vancl will soon get new financing to cover its delayed payments to suppliers, according to the report.
Chen emphasized that Vancl's operations remain normal, but it will begin restructuring based on Xiaomi's model, which focuses on simple, attractice products and continuously improving product quality. Vancl aims to be profitable and cleared of inventory, Chen said.
After meeting with Lei for a total of 60 hours, Chen decided to adopt his advice wholesale, simplifying management levels and focusing on making a few products well.
In 2011, Vancl expanded excessively in anticipation of an IPO, which failed. The quick expansion pushed up Vancl's inventory to 1.445 billion yuan (US$237 million) by the end of 2011, with a total loss of nearly 600 million yuan (US$98 million), while its 2011 sales reached only 3.8 billion yuan (US$623 million), far below its goal of 10 billion yuan (US$1.6 billion) set in early 2011.
When Vancl was full steam ahead between 2007-2010, it was capitalizing on a high profit margin thanks to its empty inventory. Vancl's inventory level now is just one-fifth of its level a year earlier after it practically gave it away for dirt cheap prices, Chen said.
Taiwan asked to cooperate with free trade zone
October 30th, 2013The mainland and Taiwan adopted 19 joint proposals at the Ninth Cross-Straits Economic, Trade and Culture Forum, one of which encourages the island to cooperate with the new Shanghai Free Trade Zone.
The proposal, announced by John Chiang, vice-chairman of the Kuomintang, calls for cooperation between a pilot free economic area in Taiwan and the Shanghai Free Trade Zone as well as with three other pilot economic areas in eastern Fujian and Jiangsu provinces.
The free economic zones established by the two sides should cooperate and learn from each other to achieve common development, according to the proposal.
The Shanghai Free Trade Zone, which began operating in late September, is a 28.78-square-kilometer district billed as a test site for deepening market-oriented reforms.
Wu Poh-hsiung, KMT honorary chairman, said during his speech at the closing ceremony on Sunday he was delighted that both Taiwan and Shanghai have planned or established free trade zones and pilot free economic areas.
"We anticipate that the mainland and Taiwan will also consider cooperation opportunities in this field to give us more power to create a prosperous future," he said.
The forum, a key platform for communication between the mainland and Taiwan, ended on Sunday in Nanning, Guangxi Zhuang autonomous region.
With closer cross-Straits economic cooperation, the two sides should explore ways to keep pace with the Asia-Pacific region's economic integration, participants at the forum said.
The 19 proposals, which also cover cross-Straits cooperation in technology, finance, agriculture, education and tourism, are important and achievable, said Zhang Zhijun, the mainland's Taiwan affairs chief. The proposals reflect an urgency from both sides of the Taiwan Straits to stay competitive within international economic and scientific fields. The proposals will also provide a useful reference point for policymakers, said Zhang, head of the State Council Taiwan Affairs Office.
Zhang said both sides should seize opportunities to cooperate in order to increase advantages in global economic, scientific and technological competition.
"I truly hope relevant authorities from both sides turn these proposals into feasible policies and measures," Yu Zhengsheng, chairman of the National Committee of the Chinese People's Political Consultative Conference, said at Sunday's closing ceremony.
Yu urged both sides to overcome difficulties and seek opportunities to promote the peaceful development of cross-Straits ties and realize China's rejuvenation through cooperation.
Sun Zhaolin, deputy head of the Department of Taiwan, Hong Kong and Macao Affairs under the Ministry of Commerce, said it's advisable for the mainland and Taiwan to first reach a consensus on cooperation within the free trade zones before discussing details of cooperation.
In the proposals, participants urged both sides to expand financial cooperation by further opening their financial markets, jointly maintain stability in markets and build financial institutions on both sides to enhance exchanges. Participants also called on the two sides to promote cooperation in such sectors as culture, film, publishing, education, agriculture, medicine, as well as tourism and youth exchanges.
Discontent grows among doctors
October 29th, 2013Nearly 80 percent of the 3,700 doctors surveyed by the Chinese Medical Doctor Association said they don't want their children to work in medicine. Many of the doctors surveyed cited the growing tension between patients and doctors as well as the escalating violence in hospitals across the country in recent years.
In 2009, 62.5 percent of the 3,200 doctors the associated surveyed expressed the same opinion, according to the Chinese Medical Doctor Association.
"We conducted similar surveys around the country in 2002, 2004, 2009 and 2011, and we found that the proportion of doctors who want to see their children become doctors keeps dropping," said Deng Liqiang, an official from the association.
An overwhelming majority of doctors also said that their salary didn't match how much work they put into their jobs, and that tense doctor-patient relationships and enormous amounts of pressure at work are creating a negative attitude toward their jobs.
"The survey results showed that doctors are not positive," Deng said.
A survey conducted by one of China's most popular medical websites, Dingxiangyuan, or dxy.cn, showed that many doctors are not in good health, with more than a quarter of those surveyed are at high risk for cardiovascular diseases. The incidence of hypertension among male doctors older than 35 is two times the normal rate.
Heilongjiang Establishes Domestic Service League to Boost Industry
October 28th, 2013The Heilongjiang Provincial Longmei Domestic Service League was founded in Harbin, capital city of northeast China's Heilongjiang Province, on October 23, 2013, to boost the province's domestic service industry.
The launch ceremony was attended by more than 50 members from domestic service agencies under the Heilongjiang Women's Federation.
Attendees discussed the league's development plans for the next three years as well as the industry's development trends, national policies and local regulations and standards.
Women's federations of all levels in Heilongjiang Province have achieved great progress in promoting the industry. There are now 57 domestic service agencies in the province and several brands have been launched.
There are about 20 million domestic workers and 600,000 domestic service agencies in China. As average income increases, the demand for domestic help continues to increase. Forty percent of urban Chinese families have a need for domestic help, indicating an additional 15 million potential job opportunities.
Approximately 90 percent of domestic workers in China are female, and ages range from 16 to 48 with the majority being 30 to 40 years old. These workers are primarily less-educated rural migrants and urban
laid-off workers.
Several government agencies share the responsibility of overseeing, regulating, and enforcing aspects of domestic work. The Ministry of Human Resources and Social Security (MOHRSS) is responsible for issuing policies, laws and regulations related to labor relations, employment, and vocational training. The Ministry of Commerce (MOFCOM) is in charge of monitoring domestic service associations at different administrative levels. The State Administration for Industry and Commerce (SAIC) issues business licenses and monitors market activity.
Domestic workers are more likely than workers in other sectors to use formal recruitment services. These services often include training, and are available from labor bureaus, and the All-China Women's Federation (ACWF). The ACWF runs 465 domestic service agencies in 16 provinces and cities, and cooperates with labor bureaus at different levels to provide vocational training and issue certificates to trained domestic workers.
The Rise Of Self-made Billionaire Entrepreneurs In China, And What It Means For The Future Of Chinese Corporations
October 28th, 2013Anyone who has followed China’s business billionaire lists in recent years will probably have noticed an encouraging trend: self-made entrepreneurs are climbing the charts. Six out of the ten billionaires topping this year’s list are genuine entrepreneurs.
There is, for instance, Baidu ’s (NASDAQ:BIDU) founder Robin Li, Tencent’s founder Ma Huateng, and Alibaba’s founder Jack Ma. They all developed true enterprises that parallel those developed by American, European, and Japanese entrepreneurs—they began with consumers and their needs, and came up with innovative products and services to accommodate them, amassing wealth in the process.
Baidu’s CEO Robin Li, number 3 in this year’s list, is a case in point. He made his billions by building a pioneering company in China’s brutal Internet market, where most companies fail to monetize their business model. Baidu’s revenues have been growing by leaps and bounds; reaching $4.17B in 2013, up from $515 million in 2008. Most notably, revenues come from several sources: Internet search, video stream (iQiyi),on-line travel services, on-line recruitment, and on-line payment systems (BaiduPai).
Baidu’s Financials
Forward PE Operating Margins (%) Qtrly Revenue Growth (%) Qtrly Earnings growth (%) Total Revenues Debt Cash
24.66 43.11 38.60 -4.50 4.17B 1.88B 5.43B
The rise of self-made billionaire entrepreneurs who build true enterprises which serve the interests of consumers is a significant departure from the old days, when entrepreneurs were government-made entrepreneurs who build “units” that served the interests of bureaucrats rather than the interests of consumers. This is true for three reasons.
First, it is a sign that China is making good progress in allocating its resources better, having entrepreneurs rather than government bureaucrats make important economic decisions. Second, it is a sign that Chinese corporations are making progress in moving from imitation to innovation, to catch up with their overseas counterparts.
Third, it is a sign that the government is loosening up its grip on the economy, releasing the ingenuity and creativity of the Chinese people.
To be fair, the government may be loosening its grip on the economy, but it continues to be on the driver’s seat, as guanxi –connections with government bureaucrats — continue to be a determining factor in who will get in what business, and for how long.
Nonetheless, this cruel reality doesn’t undermine the success of the self-made entrepreneurs – rather, it supports and re-enforces that success.
Hopefully, this trend will continue in the future.
Overpriced and surprisingly popular over here, say expat coffee lovers
October 25th, 2013The world's largest coffee chain, Starbucks, has come under fire in China for reportedly charging locals higher prices than in other markets, including the United States.
China Central Television (CCTV) analysts compared the price of a Starbucks Grande Latte (16 ounces) in four major cities around the world. Beijing came out as the most expensive at 27 yuan ($4.43), followed by London at 24.25 yuan, 19.98 yuan in Chicago and 14.6 yuan in Mumbai, India.
The CCTV report also pointed out that mugs sold in Starbucks in China are more expensive than in the US, even though they are made in China.
Starbucks responded to the report and said that the price gap between its drinks in China and the US is a result of different costs in the two markets and not because of unreasonable price settings.
Starbucks has more than 1,000 stores in the Chinese mainland and it keeps expanding rapidly. China is set to overtake Canada as its second-biggest market next year.
The issue became one of the most popular talking topics on Sina Weibo.
What do Shanghai expats think about the city's coffee prices and the prices of other foreign products in the city?
Robin Poulet, from France, designer
"We all know that Starbucks coffee is overpriced, and not only in China. The problem here is the unfairness. I don't think it is fair that Chinese customers need to pay more for their coffee when their average salaries are much lower.
It is interesting though that the Chinese customers don't seem to mind the prices; most of the Starbucks' shops I have been to in Shanghai are always full of local customers. Starbucks coffee has become something of a trend, a fashion statement, a sign of luxury for many fashion conscious Chinese while I know that many of my expat friends in Shanghai refuse to pay the higher prices here.
I splurge sometimes on a nice cup of coffee, not necessarily from Starbucks, and on other foreign products here, although I know they are much more expensive than they should be."
Laura Grossman, from the UK, manager
"Coffee in Shanghai, not only from Starbucks, is very expensive bearing in mind the average salary in China. It is pretty outrageous that Chinese customers have to pay extra for a cup of coffee considering that pretty much everything else, rent, cost of living, labor, is much cheaper in China comparing with other markets like the UK.
What surprises me is that Chinese are still willing to pay that much for their coffee. The majority of Starbucks' customers in Shanghai, Beijing, or any other Chinese big cities are locals. Considering the fact that China doesn't really have a coffee culture, this really dazzles me every time I walk into a local Starbucks.
As for me, I often pay that little bit extra to get a good quality coffee, be it in Starbucks or any other foreign coffee shop in the city. I have got used to the fact that almost any foreign product in Shanghai is way overpriced."
Grace Hamilton, from Canada, events planner
"This is not groundbreaking news for most of us. I'm aware, as are other Shanghai expats, that foreign products, including coffee, alcohol, food, clothes, shoes, or makeup, are more expensive in China than they are back home. I usually prefer to shop in local supermarkets, buy my veggies from a local wet market and eat out in local restaurants, as I know that everything that's foreign in Shanghai is usually overpriced. I would also prefer to sit in a nice small independent coffee shop and enjoy my coffee there instead of a crowded Starbucks, but unfortunately Shanghai doesn't have that many of them yet as the coffee culture here is still not that developed.
I still pay high prices for foreign products, from time to time, when I get homesick for a taste of home. As for clothes, makeup and perfumes, I shop in bulk when I go back home so that I don't have to pay these ridiculous prices when I come back to Shanghai.
But surprisingly Starbucks is filled with Chinese customers. For them, it is a luxury item and they don't mind paying the high prices."
Returnees are 'seed capital' for startups
October 25th, 2013Wen Xuejun's budding dream in the United States blossomed in China.
After staying in the US for 16 years, and holding an endowed chair professorship at Virginia Commonwealth University, Wen returned to China and set up Ryan Nanomedicine Co Ltd in Suzhou, East China's Jiangsu province.
"I have an ambition to transfer my achievements in the lab into useful medical products, and I chose to realize this ambition in China, after careful consideration,"said Wen, who now serves as the company's president.
Wen is one of dozens of people who took part in the latest 1,000 Plan Entrepreneurship Competition in Suzhou. The contest is especially designed for experienced entrepreneurs who have an overseas background.
It's part of a project known as the One Thousand Talent Plan, which has been administered by the central government since 2008.
The program is China's most ambitious specialist recruitment program in recent years. It aims to attract top international specialists in fields such as science and technology, finance and corporate management to start companies in China.
For decades, going overseas for further study was a relatively rare opportunity, and a highly desirable move for bright and ambitious people. Many of them put down roots abroad, obtaining permanent residence and building a life in a new country.
But studying abroad is becoming easier for ordinary people, and more graduates — as well as established professionals — are thinking of coming back to China, with its fast-growing economy that has become the world's second largest.
For Wen, who had an established career and a family in the US, the biggest attraction of China was strong financial support.
After winning the championship, he received 10 million yuan ($1.6 million) in strategic funding from venture capital investors, as well as 300,000 yuan in prize money.
Wen's lab in the US mastered a core technology to make collagen-coated medical catheters, which are more resistant to bacteria and cost less.
But the cost of commercializing the technology in the US would have been too high, Wen said.
The US Food and Drug Administration certification process is an expensive and complicated procedure, and hiring a team for the project would have cost at least 1 million yuan a year.
"However, I am much more familiar with the certification process in China, although the paperwork is much more time-consuming. What's more, human resources are cheaper,"Wen said.
Poon Hak Fei had a similar experience. He joined Nanosolar in Silicon Valley in California after getting his doctorate in chemical engineering at Princeton University. He then co-founded an energy storage solution startup, but he still chose to set up his first wholly owned company in Suzhou.
"To be fair, the working and living environment is very nice in the States, as well as the pay. But I do not want to miss the market opportunities in China,"he said.
Poon set up a company to make conductive nanofilm last January, with $2.2 million in strategic investment from Northern Light Venture Capital. He said he expects the company to be profitable by the end of 2013.
"The logic is to make world-class products at a lower cost in China. Meanwhile, the local government is quite efficient, and the managers from the venture capital company are very helpful,"he added. He added that a cluster of nanotechnology companies has formed in the Yangtze River Delta region, which is another plus.
Talk about China losing its labor advantage is widespread these days. According to a recent report by the Boston Consulting Group, "Made in America, Again”, the cost advantage China has over the US is shrinking fast.
"Within five years, rising Chinese wages, higher US productivity, a weaker dollar, and other factors will virtually close the cost gap between the US and China for many goods consumed in North America,"the report said.
There are also reports of manufacturer such as vehicle producers moving back to the US from China.
But people like Poon believe that for technology-intensive sectors, China still has its advantages.
"China has very smart technicians and skilled workers. They are very willing to learn, very good at solving problems. They just lack some systematic training, but they cost half as much as their US peers,"he said.
So it's possible that some blue-collar industries formerly outsourced to China will leave, but skill-intensive ones won't, he added.
Government funds earmarked for universities and research-and-development centers were used over the past couple of decades to cultivate the first wave of entrepreneurs in China.
Banks, local governments with technology zones and industrial parks later became technology investors.
Today, the rise of China's venture capital sector is supporting the entrepreneurial environment.
Media reports have said that VC investment in China peaked at $6.3 billion with 362 deals in 2011.
VCs are still keen on the Chinese market, although they've become more cautious because of a freeze on initial public offerings since late 2012, which blocked a common exit mechanism.
"You've got to go to the early stage to find good opportunities,"said Deng Feng, founder and managing director of Northern Light.
"In recent years, venture capitalists were like hunter-gatherers picking the low-hanging fruit.
"Now, we have to become peasants who labor together with the enterprises that we've invested in, to make a profit,"he said.
But that also means more opportunities for people with "hard"technology such as Wen and Poon to attract capital for their innovations.
"China has a solid base in its manufacturing industry. It's very easy to combine the hard technology and undertake mass production here,"Deng said.
Deng himself is a "returnee executive”, who was born and grew up in China. He studied and worked in the US before returning to China and setting up his VC firm in 2005. Northern Light focuses on early-stage, technology-enabled business opportunities.
"Talented returnees are displaying explosive creativity and energy in China, and becoming fresh troops in leading China's strategic emerging industries,"a central government said.
The report said that revenue generated by enterprises under the One Thousand Talent Plan has reached 63.2 billion yuan, generating profits and tax revenues of 3.5 billion yuan.
Even beyond this program, more young Chinese are returning home to find economic oppotunities.
"It is easier to achieve fast growth for companies in China due to the thriving economy. I plan to go back and start up my own business, although I am reluctant to leave the great technology atmosphere in the US,"said Wang Pu, 32, who works as an engineer for Google Inc in the US.
The Ministry of Human Resources and Social Security said 272,900 overseas students came back to China in 2012, up 46 percent from the previous year.
Although many returned students complain that it's hard for them to find jobs, high-end talent is in great demand everywhere in China. Besides the One Thousand Talent Plan, local governments at all levels are wooing well-educated specialists.
For example, Pudong New Area in Shanghai released a five-year plan late last year under which it earmarked 300 million yuan to attract world-class talent in finance, shipping and other strategic emerging industries.
C China Boosts Female Entrepreneurship with Agriculture Bases
October 23rd, 2013The women's federation of Zhengzhou, capital city of central China's Henan Province, has selected 17 new women's agriculture model bases to help female college graduates start their own businesses.
According to the federation, the women can seek internships or find jobs at the 17 bases. The Zhengzhou Women's Federation has also allocated 310,000 yuan (US$ 50,871) to provide technical and business skills training for the graduates and assigned mentors for their entrepreneurships.
A record high of 6.99 million Chinese students are leaving universities in 2013, a 2.8 percent increase year on year, to hunt for jobs at a time when employers are cutting down on recruitment, according to government figures.
The number of jobs for new hires this year has dropped about 15 percent year on year amid slowing economic growth in China, according to a Ministry of Education survey carried out among nearly 500 firms in February 2013.
In the midst of China's toughest job market to date, women university graduates are finding that they are at a disadvantage due to various factors, including gender discrimination. According to several universities in central China's Hunan Province, such as the Hunan Women's University and Hunan Agricultural University, nearly half of their women graduates have not landed jobs as of press time.
A campaign to help women college graduates find employment and get involved in entrepreneurship was jointly launched by the Women's Development Department under the All-China Women's Federation (ACWF), the Beijing-based Hua Mulan Foundation and the China Federation of Hua Mulan at the beginning of 2013 and women's federations across the country have been working out new ways to boost employment prospects for women graduates.
China to recruit 19000 national-level civil servants
October 22nd, 2013China's national-level government agencies, their affiliated public institutions and local branches will recruit over 19,000 civil servants in 2014, a slight decrease from 2013.
The 2014 public service exam for national-level governments will open to applications on Wednesday, the Organization Department of the Communist Party of China Central Committee and the Ministry of Human Resources and Social Security (MOHRSS) announced on Monday.
In 2013's exam, 20,839 positions were open to application.
According to authorities, the 2014 public service selection will continue favoring candidates who have worked in grassroots communities.
Most positions in government agencies above provincial level will require two years of grassroots working experience. About 10 percent of all vacancies will be set aside for college graduates-turned-village-heads.
A civil servant role remains the most sought-after jobs in China, despite the country's efforts to cool public service "fever," such as encouraging young people to start their own businesses or to work in grass-root communities.
Statistics show that qualified applicants in the 2011, 2012 and 2013 annual national-level public service exams totaled 1.3 million, 1.23 million and 1.38 million respectively. They stood a slim chance of securing a job in the public service.
Officials and scholars attributed popularity of the public service exam to people favoring a stable job, worship of officialdom and benefits civil servants enjoy.
Yin Weimin, MOHRSS minister, said employment pressure contributed to the exam's popularity, besides the public service exam provides an open and fair channel for job hunters.
Also, civil servants usually enjoy a stable job, social respect and handsome welfare, Yin said.
Ma Qingyu, professor with the Chinese Academy of Governance, said as many jobs become more competitive and less stable, a civil service job stands out for its stability and welfare benefits.
Chi Fulin, executive president of the China Institute for Reform and Development, believed Chinese people's traditional worship for officialdom also plays a role behind the high popularity of civil service jobs.
The growth of the market economy has created considerable job opportunities, broadening the space for personal development, Chi said. However, if people still covet power and the benefits it brings along, it signals regression of society.
Ma said even today, many people regard climbing up the official ladder as the one sure path to success.
Zhang Yuan, a civil servant who was recruited by the Ministry of Finance two years ago, said, "To my farmer parents, being a civil servant is a glorious job. The day when I received recruitment notice, my father who never drinks gave me a toast."
Additionally, scholars argued that extra benefits attached to a civil service job also makes it appealing, such as government-covered health care, subsidized housing, high pension rates, among other benefits.
Chu Jianguo, public management professor with Wuhan University, said only when the current health care and pension reforms for civil servants prevail and they enjoy the same welfare benefits as other social groups, will people's career choices diversify.
Chi Fulin suggested stricter evaluation and exit mechanisms be established for civil servants so as to destroy the "iron rice bowl", byword for stable jobs.
Shanghai Metro glitch delays morning rush hour crowds
October 21st, 2013THOUSANDS of commuters were delayed this morning as a passenger's foot was stuck in the platform gap on the Dongchang Road Station of Metro Line 2.
Metro operator is handling the emergency and expects at least 30-minute delay for the operation between the Century Avenue Station and the People's Square Station.
Crowds swelled at the People’s Square Station that is a hub for transfer to other lines.
It's the second breakdown on Metro Line 2 in a week as a system glitch caused trains on Line 2 to drive at a slower speed during the rush hour last Wednesday morning.
Shanghai Disney Resort emerges from underground
October 18th, 2013The building of the Shanghai Disney Resort saw a milestone Thursday with the installation of the first steel column, company officials said.
This marks the completion of the majority of the foundation work and the official beginning of the vertical construction, said Howard Brown, senior vice president and project development executive of Shanghai Disney Resort.
"The construction team has been working very hard at the build site since groundbreaking and we are excited to see the progress every day," Brown said.
Construction of the resort began on April 8, 2011.
With the majority of foundation work complete, work has shifted to substructure construction to support the construction of buildings and infrastructure, the company said.
Over 23,000 concrete piles have been installed, and the amount of structural steel needed for the overall resort could reach 72,000 metrics tons, Disney said.
The resort will initially include Shanghai Disneyland, a Magic Kingdom-style park, two themed hotels, a large retail, dining and entertainment venue, recreational facilities, a lake and parking and transportation hubs, the company said.
"This is a really exciting moment for everyone working on this project, and for Shanghai," said Mike Crawford, general manager of Shanghai Disney Resort.
The resort is scheduled to open at the end of 2015.
China regulates TCM ingredients
October 18th, 2013China's drug watchdog has acted to regulate the 17 markets of traditional Chinese medicine ingredients(TCM) and banned the opening of new markets.
At Wednesday's press conference, the China Food and Drug Administration (CFDA), the Ministry of Agriculture and the Ministry of Industry and Information Technology, among eight central departments announced joint regulation on TCM ingredients.
Supervision of growing, processing and market management for medicinal herbs should be stepped up, said Li Guoqing, director of the CFDA's department of drug and cosmetics sales supervision.
According to the CFDA, improper use of pesticides and fertilizers has caused harmful substances to remain in TCM ingredients. Dyeing and counterfeiting problems have seriously affected TCM quality and harmed public health.
According to a CFDA inspection in Anhui, Gansu, Guangdong and Sichuan provinces, 22 batches of TCM, including saffron, of nearly 400 batches examined have the dyeing problem.
The announcement prohibited planting in inappropriate areas and the use of certain pesticides, antibiotics and fertilizers, especially animal hormones, plant growth regulators and herbicides.
It also banned fumigating herbs with sulfur, adding the amount of sulfur dioxide residue should accord with national standards.
China rich club swells despite slowdown
October 17th, 2013China’s super rich only got richer despite the mixed news on the economic front with numbers up a record high, Forbes magazine said in Shanghai yesterday.
The magazine yesterday released the 2013 Forbes China Rich List, a ranking of the top 400 wealthiest Chinese.
Based on calculations as of September 26, the number of Chinese mainland residents with personal assets of more than US$1 billion rose to 168 — an increase of nearly 49 percent from last year’s 113.
The combined net worth of those on the list surged 35 percent to 3,475 billion yuan (US$570 million), or 8.7 billion yuan each on average.
For the top 100, the wealth growth was even faster, reaching a pace of 44 percent.
Though the rapid rise in the numbers of the wealthy individuals seems a little out of sync with the current slowing economy, it is a reflection of the earning power of some entrepreneurs, and the money-spinning power of some hot industries like the Internet, automobiles, entertainment and real estate, said Russell Flannery, Shanghai bureau chief of the magazine.
On top of the list is property tycoon Wang Jianlin, chairman of Dalian Wanda Group, with 86 billion yuan.
Last year’s richest man, beverage king Zong Qinghou of Hangzhou Wahaha Group, was second with 68.3 billion yuan.
Robin Li, founder of Baidu, China’s biggest search engine provider, was third on the list with 67.7 billion yuan.
The IT industry was led by Pony Ma of Tencent with 62.2 billion yuan, and Jack Ma of Alibaba with 43.4 billion yuan — both ranking in the top 10.
There are 87 new faces on the list.
Among the newcomers, the biggest heavyweight is Li Hejun of Hanergy, one of the world’s biggest solar panel makers, with 66.5 billion yuan in personal assets.
“Despite the continued economic slowdown, China’s current urbanization level can still bolster the pace of development of consumer products and services, pharmaceutical and health care, culture and entertainment as well as mobile Internet, making these industries key players in China’s wealth creation movement,” Zhou Jiangong, editor-in-chief of the Forbes magazine’s Chinese version, said.
Aircraft leasing business booms at N China port
October 17th, 2013The aircraft leasing industry at China's largest free trade port in northern Tianjin Municipality has witnessed booming trade with strong business volume and market share, authorities said Tuesday.
The Tianjin Dongjiang Free Trade Port Zone is the base for five headquarters from home and abroad, as well as 242 SPV (special purpose vehicle) companies in the aircraft leasing business, the zone's management committee said.
The zone started operating in 2007 and is China's largest free-trade harbor area.
Since then, aircraft leasing companies registered in the zone have contracted out 246 jets, about 90 percent of the domestic market share, with business worth 10.6 billion U.S. dollars.
The committee said the development of the sector was due to preferential policies in the zone. In August 2012, China announced a pilot scheme in the zone to offer tax rebates on exports of financial leasing companies.
College ordered to revise student internships at Foxconn factory
October 16th, 2013The education authority in Shaanxi province has ordered a college that sent student interns to Foxconn to revise its cooperation agreement with the company to better protect students.
Hui Chaoyang, director of the provincial education department, said the department has found problems with the management of the work experience activities of Xi'an Technological University's North Institute of Information Engineering.
They alleged the college forced students to take internships in one of the Taiwan-based electronics giant's factories in Yantai, Shandong province. Some interns were made to work overtime on the assembly line.
Hui said the college did not offer other work experience options for students.
Some of the work was not in line with the objectives of the students' professional training, Hui said. For instance, students majoring in finance and accounting were also put to work on assembly lines.
The official added that some students were also required to work much harder than expected.
The college decided on Sunday to suspend its cooperation agreement with Foxconn and around 1,000 students working for the factory will return to school by Wednesday, said Zhang Jun'an, president of the college.
Zhang said the school started cooperating with Foxconn's Yantai plant in 2010 and has sent students there every summer vacation.
Zhang acknowledged the school received 100 yuan ($16) per student from Foxconn as a management fee if the student worked in the factory for two months.
"The amount of the management fee in 2012 was some 70,000 to 80,000 yuan and in 2013 reached more than 100,000 yuan. Our school used the money for student activities such as teaching contests and sports games," Zhang said.
Students also earned some wages for their work.
In the past three years of cooperation with Foxconn, the school also received financial support from the company to establish scholarships and teaching awards to encourage excellent students and teachers, and for the construction of a laboratory. The financial support totaled more than 300,000 yuan, Zhang said.
This summer vacation, more than 5,000 students from the institute were sent to Foxconn's Yantai factory from late July to late September.
A student surnamed Li told China Daily she had to work more than 10 hours a day on the assembly line pasting labels on recording pens.
"The work was hard and boring, and we do not think such so-called work experience made any sense," the student said.
Another student surnamed Wang said they were required to take part in the work experience activities as this gained them six academic credits toward their diplomas.
Foxconn admitted last week that its Yantai factory forced the students to work overtime and on night shift, which broke the company's rules, and vowed to resolve the problem.
From 2009, cases of students from Chongqing and Jiangsu, Shanxi and Shaanxi forced to work in Foxconn have been reported regularly and people suspected the students are used to tackle the company's labor shortage.
Shi Ying, deputy director of Shaanxi provincial academy of social sciences, said such work experience for students was justified and essential but arranging overtime for the students broke Chinese labor law.
China's output growth eases in both manufacturing and service sectors: HSBC
October 16th, 2013The HSBC China Composite PMI data, which covers both manufacturing and service sectors in the country, signaled a further expansion of output in September, and the rate of expansion remained modest, with the index posting at 51.2 in September, easing from 51.8 in August, HSBC said in an emailed press release here on Tuesday.
Manufacturers reported a further increase in order book volumes last month, however, the rate of increase was unchanged from August's marginal pace, the report said. Meanwhile, at service providers, new order growth slowed from August, but was nonetheless marked.
Employment levels at Chinese manufacturers declined for the sixth month in a row in September, and the rate of job shedding was moderate and broadly unchanged from August. In contrast, staffing levels increased at service providers, following a reduction one month previously.
The input costs faced by manufacturers increased at the fastest rate since February. Service providers also reported higher input costs, though the rate of inflation was modest and below-trend. Both manufacturers and service providers passed on higher input costs to clients by raising their output prices in September. The rates of increase were modest across both sectors.
Service sector firms operating in China expected activity levels to be higher in one year's time. However, the degree of positive sentiment was the second-weakest in the series history.
Qu Hongbin, Chief Economist, China and Co-Head of Asian Economic Research at HSBC said China's services activity growth appears to be stabilizing at a faster pace than in the second quarter and this led to a renewed expansion of employment from the contraction in August.
"Combined with the gradual improvement of the manufacturing PMI, the Chinese economy is still on the way to a modest recovery. But a more consolidated and sustainable recovery requires structural reforms," he said.
116 medics involved in Dumex milk bribe scandal
October 15th, 2013SOME 116 medical staff from 85 institutes in north China’s Tianjin Municipality were involved in a bribery scandal with French infant formula producer Dumex, the city government said yesterday.
From 2011, staff collected personal details of newborn babies for the company, gave presentations, distributed publicity materials and offered free introductory cans of Dumex.
In return, they received kickbacks from Dumex, part of French food group Danone, an investigation found.
Staff involved every month received sums ranging from hundreds to tens of thousands of yuan.
The cash has been recovered, the government announced on its official Weibo.com micorblog.
Thirteen people have either been sacked, had operation licences revoked or been transferred to other positions.
And another six people, who had supervisory duties, received administrative punishments, the statement said.
Tianjin government did not give details on the remaining 97 staff involved in the scandal.
It said three names published in earlier media reports — Li Yue, Wang Zi and Lu Xuezhi — were Dumex employees, rather than hospital workers.
Dumex China launched an internal investigation after media reports in September.
Over the weekend, it said the investigation has now been “substantially completed.”
Dumex blamed the scandal on shortcomings in a company-sponsored mother-and-child health education program.
These led to “practices that contradicted the purpose of the program, which violated companywide policies,” said Dumex.
In some cases, the program was not appropriately managed, said the company.
Dumex said the program has been suspended, new management would be appointed, and training carried out.
Last month, a China Central Television program claimed doctors and nurses in Tianjin were feeding babies with Dumex in return for cash payments.
Babies developed a taste for Dumex and rejected their mothers’ milk, it was claimed.
It also gave Dumex an advantage in the fiercely competition formula milk market, said the report.
Last week CCTV claimed that the bribery scandal extended to other cities, including Beijing.
In 2011, the former Ministry of Health ruled that producers were not allowed to promote formula to babies up to six months old, unless mothers suffered from serious conditions.
In 2008, the Supreme People’s Court and Supreme People’s Procuratorate said that medical staff using their positions to make money would be considered to be taking bribes.
China to recruit 19,000 national-level civil servants
October 15th, 2013China's national-level government agencies, their affiliated public institutions and local branches will recruit over 19,000 civil servants in 2014, a slight decrease from 2013.
The 2014 public service exam for national-level governments will open to applications on Wednesday, the Organization Department of the Communist Party of China Central Committee and the Ministry of Human Resources and Social Security (MOHRSS) announced on Monday.
In 2013's exam, 20,839 positions were open to application.
According to authorities, the 2014 public service selection will continue favoring candidates who have worked in grassroots communities.
Most positions in government agencies above provincial level will require two years of grassroots working experience. About 10 percent of all vacancies will be set aside for college graduates-turned-village-heads.
A civil servant role remains the most sought-after jobs in China, despite the country's efforts to cool public service "fever," such as encouraging young people to start their own businesses or to work in grass-root communities.
Statistics show that qualified applicants in the 2011, 2012 and 2013 annual national-level public service exams totaled 1.3 million, 1.23 million and 1.38 million respectively. They stood a slim chance of securing a job in the public service.
Officials and scholars attributed popularity of the public service exam to people favoring a stable job, worship of officialdom and benefits civil servants enjoy.
Yin Weimin, MOHRSS minister, said employment pressure contributed to the exam's popularity, besides the public service exam provides an open and fair channel for job hunters.
Also, civil servants usually enjoy a stable job, social respect and handsome welfare, Yin said.
Ma Qingyu, professor with the Chinese Academy of Governance, said as many jobs become more competitive and less stable, a civil service job stands out for its stability and welfare benefits.
Chi Fulin, executive president of the China Institute for Reform and Development, believed Chinese people's traditional worship for officialdom also plays a role behind the high popularity of civil service jobs.
The growth of the market economy has created considerable job opportunities, broadening the space for personal development, Chi said. However, if people still covet power and the benefits it brings along, it signals regression of society.
Ma said even today, many people regard climbing up the official ladder as the one sure path to success.
Zhang Yuan, a civil servant who was recruited by the Ministry of Finance two years ago, said, "To my farmer parents, being a civil servant is a glorious job. The day when I received recruitment notice, my father who never drinks gave me a toast."
Additionally, scholars argued that extra benefits attached to a civil service job also makes it appealing, such as government-covered health care, subsidized housing, high pension rates, among other benefits.
Chu Jianguo, public management professor with Wuhan University, said only when the current health care and pension reforms for civil servants prevail and they enjoy the same welfare benefits as other social groups, will people's career choices diversify.
Chi Fulin suggested stricter evaluation and exit mechanisms be established for civil servants so as to destroy the "iron rice bowl", byword for stable jobs.
Work Or You Can’t Graduate: Chinese College Students Forced To Labor Illegally In Foxconn Factory To Make PlayStation 4 Console
October 14th, 2013Foxconn, the electronics contract manufacturing firm that supplies products to Apple Inc. (NASDAQ: AAPL) and many other companies, is facing yet another controversy over its labor practices.
The Taiwan-based company has recently admitted to violating its own rules by employing student interns for overtime and night shifts at their factories.
Students from a university in Yantai, located in the northern coastal province of Shandong, have come forward to Chinese media claiming that more than a thousand of their classmates have been working illegal overtime hours at a nearby Foxconn factory helping in the production and packaging of the soon-to-be debuted Sony (NYSE: SNE) PlayStation 4 gaming console. Sony has confirmed that Foxconn is manufacturing the PlayStation 4, but did not confirm if they were made at the Yantai location.
“There have been a few instances where our polices pertaining to overtime and night shift work were not enforced,” Foxconn said in a statement. “Immediate actions have not been taken to bring that campus into full compliance with our code and policies.”
The students were essentially forced to work at the factory in order to fulfill their credit requirements to graduate. According to a report by Hong Kong’s Oriental Daily newspaper, the class of engineering students at the Xi’an Institute of Technology was told that participation in the internship at Foxconn was “necessary” if they wanted to receive six credits that would make them eligible to graduate on time. Foxconn said that the company has internship programs set up in various locations in China, but insisted that the experience is intended to give students an “opportunity to gain practical work experience and on-the-job training that will support their efforts to find employment following their graduation.” According to Quartz, the “internships” included performing such tasks as gluing parts together, applying stickers and boxing up accessories, earning students the same wage as entry-level employees.
Foxconn has a long and troubling history of labor woes. Just last year, the same factory that the university students have come forward about admitted to temporarily hiring under-age interns, some of whom were as young as 14 years old.
In 2010 Foxconn was under investigation after a string of factory-worker suicides (largely due to overwork and poor working conditions) drew attention from labor rights activists and the global media.
The latest allegations came just days after Foxconn CEO Terry Gou made a statement about the lack of young people interested in factory jobs. Talking to a delegation at the Asia-Pacific Economic Cooperation (APEC) Forum in Bali, Indonesia, Gou lamented on how China’s young workers were no longer lining up to work on an assembly line and instead were more interested in finding jobs in the technology or service sectors.
Doubts over accuracy of data on pay rises
October 12th, 2013Newly released official data about pay rises in the 2007-2011 period has stirred online debate over the figures’ accuracy, with many believing the increases are not remarkable enough considering inflation and surging housing prices.
The Chinese Academy of Personnel Science on Thursday published a report on the development of human resources in China, showing that the average annual salary of urban employees increased from 24,721 yuan (US$4,022) in 2007 to 41,799 yuan in 2011, up 69.1 percent.
In 2012, the average yearly salary for urban employees in non-private sectors stood at 46,769 yuan, up 9 percent year on year after deducting price factors, according to the report.
The news triggered heated discussion soon after appearing on popular Chinese websites — most netizens questioned the figures in the context of their own lower salaries and deemed the data useless amid surging expenditure.
“I feel ashamed that my salary is again below the average level” was a common comment on Sina Weibo, one of China’s most popular Twitter-like services.
Microblogger “joys” said: “After carefully rechecking my paychecks, I am sure that I was ‘averaged’ with other rich workers.”
In fact, many indicated the high salaries only belong to civil servants and employees at state-owned enterprises and monopolies.
Meanwhile, the debate turned against the relatively larger growth in prices, especially in the real estate businesses.
According to the National Bureau of Statistics, China’s consumer price index, the main gauge of inflation, increased 2.6 percent year on year in August, a slight decline from 2.7 percent in July.
The CPI rose 2.6 percent year on year by the end of 2012, but it was a rise of 5.4 percent in 2011 from the previous year, well above the government’s full-year inflation control target of 4 percent.
On the other hand, driven by rapid urbanization and speculation, China’s property market has taken off in recent years, especially after the economic stimulus policies the government unveiled in 2009 to help the country weather the global financial crisis.
The China Index Academy, a leading property research institution, said the average new home price among 100 cities stood at 10,554 yuan per square meter in September, up 1.07 percent from August and an increase for a 16th consecutive month.
Foxconn admits student interns worked night shifts, overtime in breach of own rules
October 12th, 2013Taiwanese electronics giant Foxconn, which assembles products for companies such as Apple, Sony and Nokia, admitted Friday that student interns had worked night shifts and overtime at one of its plants in China in breach of its owns labor rules.
The embarrassing admission came after Chinese media reported last year that students from a university in the central city of Xian were allegedly forced to join Foxconn’s internship program at its Yantai plant in the eastern province of Shandong.
Instead of doing work related to their major, the information engineering students claimed they were assigned to assembly lines to make Sony’s PlayStation game consoles and were forced to toil for up to 11 hours a day.
More from GlobalPost: Foxconn to open American factories?
They were allegedly told they wouldn't graduate if they quit.
"Regarding the internship program at our Yantai campus, we have determined that there have been a few instances where our policy pertaining to overtime and night shift work were not enforced," the company said Friday.
"Our priority is to protect the rights of all workers and interns, and we will continue to monitor the program closely to ensure that such infractions are not repeated.”
Foxconn, which has been under the spotlight after a series of suicides and labor unrest at its Chinese plants in recent years, previously admitted employing underage interns at the Yantai factory.
Merck’s Job Cuts Highlight A Big Problem Facing Big Pharma Companies
October 11th, 2013Merck (NYSE:MRK) has announced that it will cut its workforce by 20% over the next two years, which could result in the loss of close to 16,000 jobs. This will leave the company with less than 65,000 employees which is in stark contrast to its peak strength of close to 100,000 employees following its acquisition of Schering-Plough in 2009. [1] With this restructuring, Merck intends to save $2.5 billion annually which can boost its free cash flows by almost 20%. However, the impact will be mitigated by the expected restructuring costs of roughly $2.5 billion to $3 billion. [1]
The company’s move highlights the broader problems that Merck and other big pharmaceutical firms are facing today. The R&D (research and development) productivity has declined over the years, and the strategy of developing drugs for major diseases is not working. The landscape of the global pharmaceutical industry is shifting towards more niche, innovative and genetically targeted medicines. In addition, Merck is suffering from the loss of patent exclusivity for some of its major drugs and may look for acquisition of some promising medicines to offset the failure of some of its research projects.
What Is The Problem That Merck Is Facing?
Like other major pharmaceutical companies, Merck is also battling the impact of patent expiry of its several major drugs including Singulair, Propecia, Clarinex, Maxalt, Cozaar and Hyzaar. Out of these, asthma drug Singulair has had the biggest impact and has continually weighed on Merck’s growth for the past few quarters. Worldwide sales of Singulair, a once-a-day oral medicine for chronic treatment of asthma and relief of symptoms of allergic rhinitis, stood at $5.5 billion for 2011. However, this figure declined to $3.85 billion in 2012 following its patent expiry in August same year. Merck expects that within two years following the patent expiration it will lose substantially all U.S. sales of Singulair, with most of those declines coming in the first year.
In addition, Merck’s cardiovascular division has also been hurt by the patent cliff as its drugs Cozaar/Hyzaar, which garnered over $2 billion in revenue in 2010, lost patent exclusivity in large markets including the U.S. and Europe in late 2010. As a result, sales fell by roughly 35% to $1.3 billion in 2012. Additionally, Propecia, Clarinex and Maxalt together accounted for roughly $1.5 billion in revenues in 2012. Due to patent expiries, we expect their combined sales to go down to about $1-1.1 billion in 2013.
While the big drugs are losing their sales, there is little chance for new blockbusters replacing them. The R&D productivity has significantly declined over the last decade. Although the industry’s R&D spend has increased, the number of new drugs approved by the FDA has come down. In fact, Merck is planning to terminate certain drugs in late stage development and intends to focus on acquiring experimental drugs.
What Is Merck Likely To Focus On?
There has to be a shift from developing blockbusters treating major diseases to focusing on niche therapeutic areas where although the patient population is low, pricing is quite high due to high specificity and efficacy. Major therapeutic areas are getting flooded with generics and there haven’t been any major advancements to thwart the competition. Merck has mentioned that it plans to continue investing in vaccines and diabetes, where it already has successful products.
Diabetes
Merck’s type 2 diabetes treatment drugs Januvia and Janumet saw strong volume growth in international markets and retained their market leadership with 70% share in the second quarter. [2] Excluding the impact of currency movement, Januvia saw its sales jump by 7% while Janumet’s revenues surged 17%. [3] In addition, the company is working with Pfizer to develop and commercialize its investigational SGLT2 inhibitor, Ertugliflozin, for the treatment of type 2 diabetes. With obesity on the rise, diabetes is affecting more people globally. In the U.S. alone, roughly 26 million people suffer from the condition. [4] China’s problem is even worse, as a report suggests that 11.6% of Chinese adults have diabetes and around 40% of adults between the age of 18 and 29 are on the verge of developing it. [5] That puts China’s diabetes patient count at 114 million individuals, and this figure is likely to go higher. According to IMS health, China’s diabetes market is expected to grow 20% annually and reach $3.2 billion by 2016. [6]
We currently account Januvia’s revenues under Alimentary & Metabolism drugs division, which constitutes roughly 15% to our price estimate for Merck. Januvia’s importance can be gauged from the fact that the exclusion of the drug’s sales from Merck’s revenue forecast leads to downside of about 5-10% to our price estimate. That’s a lot of value for a single drug in a diversified company like Merck.
Acquisition Strategy
It appears that Merck will trim down its R&D expenses, and instead focus on acquiring drugs externally. This way, the company will assume the role of pharmaceutical private equity/venture capitalist firm to a certain degree. In addition, we believe that it can pursue orphan drugs, and novel therapies including higher focus on gene therapy, stem cell research etc.
Cancer Treatment
Cancer treatment is a growing market for the pharmaceutical industry. The opportunity comes from the fact that global incidence of Cancer is likely to increase from about 12.7 million in 2008 to 21.3 million in 2030. [7] In addition, the number of deaths are likely to show a similar growth trajectory as depicted in the chart below. Cancer is a not a single disease, it has in fact more than 200 types and thousands of subtypes affecting more than 60 organs. That gives an opportunity for Merck to develop novel therapies and capture niche markets.
Our price estimate for Merck stands at $51.60, implying a premium of about 5-10% to the market price.
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Notes:
Merck to Cut Staff by 20% as Big Pharma Trims R&D, The Wall Street Journal, Oct 22013 [?] [?]
Merck’s Q2 2013 Earnings Transcript [?]
ref:1 [?]
National Diabetes Fact Sheet, 2011, CDC [?]
China ‘Catastrophe’ Hits 114 Million as Diabetes Spreads, Bloomberg, Sept 4 2013 [?]
China Diabetes Triples Creating $3.2 Billion Drug Market, Bloomberg, Nov 5 2012 [?]
J&J’s Investor Presentation [?]
Foxconn admits student intern labour violations at China plant
October 11th, 2013Electronics manufacturer Foxconn, which became notorious after a string of workers’ suicides in 2010, has admitted that student interns worked overtime and night shifts at a factory in northeast China in violation of company policy.
Students told Chinese media that more than a thousand of their classmates worked on basic tasks such as putting together and packaging parts for Sony’s forthcoming PlayStation 4 consoles. The college programme at the factory in Yantai, Shandong province, was a graduation requirement, they said.
The admission is a blow to the Taiwanese company most famous for assembling Apple products, and comes in the same week as Terry Gou, its founder and chairman lamented that young Chinese are shunning monotonous, low-paid assembly line jobs.
The same factory last year admitted to having temporarily hired underage interns.
“There have been a few instances where our policies pertaining to overtime and night shift work were not enforced. Immediate actions have been taken to bring that campus into full compliance with our code and policies,” said Foxconn in a statement.
Foxconn have not confirmed or denied that they make the PlayStation 4 at Yantai. Last year, it said the factory did not produce Apple products. Sony confirmed that Foxconn is assembling the PlayStation 4, but did not specify at which factory.
The Taiwanese company, listed in Taipei under the name Hon Hai Precision Industries, last year found that students as young as 14 had been working at the Yantai campus for a few weeks. It pledged at the time to investigate how workers younger than the minimum age of 16 came to be working at the plant.
Foxconn and other contract manufacturers regularly employ students as temporary workers to give the students a chance to gain skills. The programmes are sometimes criticised by labour activists, who say the students often make up for staff shortages and are not offered meaningful training.
Under Foxconn’s policies, interns are not allowed to work overtime or nights and have the right to leave the programme at any time.
As part of its work with the Fair Labor Association – independent inspectors brought in by Apple to audit some Foxconn factories, not including the Yantai facilities – Foxconn has also pledged to ensure that interns’ work matched their educational programmes, according to FLA’s report on its work.
Analysts and news reports in Taiwan and mainland China indicate that other electronics manufacturing companies have been facing staffing shortages as production on new popular products such as the iPhone 5c and 5s ramp up and distributors stock up ahead of the winter holiday season.
Pegatron, which manufactures for groups including Apple and Sony, has been facing “severe” staffing shortages near its Shanghai factories, said analysts at Nomura in a recent note.
Shanghai FTZ starts offering registration services
October 10th, 2013A total of 577 people applied for enterprise registration at the newly-launched Shanghai pilot free trade zone (FTZ) on Tuesday, the first day for registration, according to an official statement.
Meanwhile, 1,480 people visited the zone's service lobby asking for advice and information on Tuesday, according to the statement.
Sun Baohua, a businessman from Wenzhou City of neighboring Zhejiang Province, was the first person to apply for a registration.
Sun, who owns micro-financing company, has rented a 20-square-meter warehouse in the zone as his office. He is expected to get his business license within four days.
"The financial institutions allowed to run businesses in the zone are all big companies," said Sun. "While my company caters for medium and small-sized enterprises with lower interest rates."
The Chinese government officially inaugurated the 29-square-km Shanghai FTZ on Sept. 29.
Testing of a convertible yuan, wider opening of 18 service sectors, a negative list approach in governing foreign investment, among other initial steps, are expected to unleash economic potential in the zone in the coming two to three years.
Beijing to hold next year’s APEC summit
October 10th, 2013The 2014 Asia-Pacific Economic Cooperation (APEC) summit will be held in Beijing. It is viewed as a good opportunity to expedite urban development and pollution control, said a press officer of the Beijing municipal government.
Zhao Huimin, director general of the Foreign Affairs Office of Beijing's municipal government, announced that the 2014 APEC summit will be held at Yanqi Lake, a scenic site in Beijing's northwestern suburbs at a Tuesday press briefing in Bali, Indonesia.
Yanqi Lake was selected to let leaders of the APEC member economies enjoy the beautiful views of Beijing's outskirts, Zhao said, adding that compared with the time when Beijing held the 29th Olympic Games in 2008, the city has become more experienced to curb air pollution.
"Construction work at the site will follow environmentally-friendly principles. The venues will be using 100 percent clean energy, with all sewage and household waste processed, making the site an outstanding example of green and energy saving architecture," Zhao was quoted by the Beijing Youth Daily as saying.
The public expressed their welcome to the summit. However, severe air pollution which haunted the capital during the seven-day National Day holiday and reoccurred recently became the biggest challenge the city is facing.
"Compared with 2008, Beijing is facing greater pressure due to an increasing number of vehicles and more chemical facilities have been seen around Beijing in the past five years," Wang Tao, a scholar at Carnegie-Tsinghua Center for Global Policy, told the Global Times.
"Air pollution is hard to curb within one year unless the government shuts down those chemical plants and takes more tightened restrictions to vehicle usage," Wang noted.
Beijing had launched an ambitious and strict clean air plan, aiming to reduce polluting particulate matter by 25 percent from 2012 by 2017.
The project was designed to be an international conference and exhibition center which takes up 31 square kilometers, with a total investment of 36 billion yuan ($5.9 billion) and is capable of housing up to 20,000 people.
"The construction of the site started several months ago. Many engineering companies have participated in the project, with some of the buildings being close to finished now," a communication officer, surnamed Guo, with a construction company responsible for three buildings of the project, told the Global Times on Wednesday.
Zhao also presented the logo of the 2014 APEC summit, which represents the Chinese government's wish of cooperation with the other member economies by outlining a pattern of the earth with 21 horizontal, colorful lines, each representing a member economy.
The design also shares a similarity with Tiantan, or the Temple of Heaven, one of the most popular historical sites in Beijing.
'Skills list' to attract overseas talent
September 30th, 2013China is to publish a list of work skills most in demand to aid recruitment from overseas, a top official in charge of foreign affairs has revealed.
Speaking ahead of the 2013 Friendship Award ceremony on Saturday, Liu Yanguo, deputy director of the State Administration of Foreign Experts Affairs, said his authority is identifying shortages in the domestic labor market.
"We’ll do research with human resource departments and employers to learn what types of workers they feel are hard to find,” he told China Daily.
The list is scheduled for release next year, and will be updated to keep pace with changes in market demand.
How and where it will be published, as well as other details, are still under discussion, Liu added.
Wang Huiyao, director-general of the Center for China and Globalization, a Beijing think tank, welcomed the move.
"It’s important to have such a list. It can improve the effect of recruitment from abroad,” he said.
By listening to employers’ demands, he said, authorities will be able to pinpoint industries with long-term skill shortages and introduce favorable policies.
Shanghai began publishing a recruitment list for overseas talent in 2011. On the list, nine State-owned enterprises, including Shanghai Electric, provide 72 job vacancies that they plan to fill, with salaries up to 800,000 yuan ($131,000).
China needs foreign talent from all walks of life, especially people with expertise in management, technology and science, Liu said.
He added that China’s efforts to recognize and reward people who have made tremendous contributions to China’s development and bilateral friendship is equally important in attracting high-end talent.
Fifty foreign experts received the Friendship Award this year. The prize is the highest accolade given to foreign citizens by the Chinese government.
Liu said all winners are distinctive foreign experts working in China.
Many recipients this year are leading scientists and scholars, including Israeli biologist Aharon Ciechanover, the 2004 Nobel laureate in chemistry, who is director of Nanjing University’s Institute of Chemistry and Biomedical Sciences.
"Thirty years ago, most foreign experts came to help China solve technological problems, but now China also enables foreign experts to realize their dream and boost their career development,” Liu said.
Noticeably, four recipients, including Ravi Shankar Narasimhan, a senior editor at China Daily, were recognized for efforts in “helping China better tell its stories to the outside world”, Liu said.
"Many foreigners, after they came to China, realized China was not a rising monster but a fascinating country,” Liu said. “We appreciate foreign experts’ efforts can help the outside world better understand China.”
Internships have become a necessity for graduates to secure jobs
September 30th, 2013The job market has become so competitive that even well-qualified graduates need to secure internships to find work
Twenty-three-year-old Baptist University graduate Trista Hon has reason to be excited. She is about to start working at BDO, an international accounting company, after beating many others for the position.
Hon attributes her success to her two-month working experience in Shanghai in the summer of last year. Hon took part in the government's Mainland Experience Scheme, a five-year pilot scheme launched in 2011 to sponsor short-term internships, or learning programmes, in the mainland for about 30,000 students.
"Auditing jobs require frequent travel to the mainland. It helps a lot that I have some understanding of working across the border. I can also adjust to working in the mainland better than other students," says Hon, who will be based in Hong Kong for the near future.
To prepare Hon for her stay in the mainland last year, Baptist University's career centre evaluated her fluency in Putonghua, along with her ability to cope with emergencies when working outside the territory.
In the current competitive economic environment, internships can give potential graduates a head start. Every day, recruiters are flooded with applications from university students who possess stunning academic credentials.
"We come across graduates with impressive academic and extra-curricular credentials all the time," says Sue Kim, founder of LIBBLE, an online platform established two years ago that is dedicated to the development of new graduates, and job matching.
"It's very easy to find a graduate who speaks four languages, has completed more than three internships or won academic scholarships, on our talent database," says Kim. "Competition has indeed become fierce."
In response to this challenging employment landscape, career centres at universities are constantly on the lookout for internship opportunities locally, globally and in the mainland.
Since 2005, Polytechnic University has required students to complete at least one internship before graduation. Every year, an average of 3,000 students from PolyU are engaged in an internship.
This summer, Chinese University placed 570 students in internships in 24 countries, under its global internship programme.
"Employers prefer job applicants with internship experience because they are more mature and more familiar with the corporate world," says Melina Lai, director of the Office of Careers and Placement Services at PolyU. "They tend to have a stronger work ethic and are more adaptable."
"If a new graduate has never done an internship, employers may wonder if the graduate lacks the initiative to look for one," she explains.
The chance of a student being hired is boosted if he or she has international working experience, according to Dr Tim Wong, head of Baptist University's career centre. "Medium to large-sized companies are selective in the recruitment process, and an international internship would improve the chance for a job candidate," he says.
Echoing Wong, Lai says students with international experience had demonstrated better communications skills and flexibility, and were more independent.
Work experience prior to leaving school is especially beneficial for students without a professional degree. For example, an English major with an emphasis on languages and literature has plenty of options other than teaching, including administration, journalism, legal services, sales and marketing, and public relations.
"Employers are looking for people who have been exposed to more than one particular field," Wong says.
Career advisers at the institutes are charged with the task of equipping students with the skills for a smooth transition into corporate life. Training courses and workshops on job hunting skills, interview etiquette, and resume writing, are organised on campus.
Before they start their internship, students are briefed on issues such as foreign culture, if they are heading to the mainland or overseas, and the jargon of particular industries.
The role interns are expected to play has changed over the years. In the past, the youngsters were seen as helping hands to provide support for the regular staff in an office. But now the new entrants are increasingly being integrated into overall manpower planning.
An internship can pave the way for a permanent position in large companies. Banks, in particular, may issue conditional offers to student workers who perform well, before they get their degrees.
Many employers view an internship as an arrangement that is meant to benefit the company as well as the student. "[It is] for the mutual benefit of the students and the employers themselves," says Lai. "We have come across small and medium sized enterprises which offer internships to develop students' interest in their fields.
"Eventually, the employers hope to secure their long-term commitment to the company. This in turn, helps to plug the shortfall from the turnover of regular staff," she says.
While a university degree, stellar academic results and other criteria are often advantageous, employers also take soft skills into consideration to identify the right candidates.
Sectors like banking, asset management, consumer products, retail and technology want to be sure that the young workers have a can-do attitude and are reliable, Kim says. "To impress experienced recruiters, graduates need to be able to show genuine passion and interest for the role. They can do this by having a good understanding of themselves and their interests," she says.
"They are also looking for people who can formulate their own views. Critical thinking and problem-solving skills are useful, as is the ability to construct a sound opinion." Baptist University encourages students to become involved in community projects. They try to get them to help with the co-ordination, rather than just join in. "Students nowadays tend to be less independent. They need to become proactive in finding resources," Wong says.
The recent death of an intern at Bank of America in London, which is believed have been caused by excessive work, raised questions about the exploitation of young graduates.
"We always monitor the situation of our students closely by keeping in touch with them throughout the internship," Wong says.
Staff from the career centre join students abroad to help them settle in, he says, adding that social media is used to share information among students and keep track of their situation.