Permalink 10:57:45 am, by dacare, 412 words, 142 views   English (US)
Categories: News of China

Chinese SMEs confidently join global competition

With increasing manufacturing capability and desires to expand their business, more and more Chinese manufacturing companies, especially small and medium-sized enterprises (SMEs), are looking beyond Chinese boundary to join global competition confidently.

At the ongoing Hanover Fair, the world's biggest industrial trade show, nearly one sixth of the exhibitors, came from China.

"With years of investment in technology innovation and improvement in product quality, we feel that we have gained enough strength to compete with foreign companies. So we decided to get out and broaden market overseas," said Li Wenguang, sales chief of a 400-employee manufacturer of reduction drives in China's central Hubei province.

According to Li, the company, Hubei Planetary Gear Boxes, was founded in 2004 and had earned a strong market position in China. But it was not satisfied with the status quo and wished to gain more business.

It was the first time that his company attended a foreign trade fair.

Compared to Li's company, Anyhertz Drive from Shenzhen, which started exporting five years ago, was more experienced in foreign business, as a quarter of the variable-frequency drive manufacturer's total sales come from overseas.

"Our main foreign markets were in Southeast Asia and the Middle East. In Hanover, we wish to get more resources and expand our markets," the company's foreign business chief Ocean Wang said.

For some Chinese SMEs, the purpose of expanding foreign business is not just making money.

"We also wish to help promote our national brand and improve the reputation of 'Made in China'," said Yanbeen Deng, vice president of Sure Instrument from Tianjin.

" 'Made in China' does not mean low price and low quality," Deng said, adding that the competitiveness of Chinese products increased tremendously in recent years thanks to Chinese manufacturers' flexibility in providing services and increasing investment in research and development.

"We see more opportunities as our nation is more and more open to the outside world, and we are confident to join global competition and to win in foreign markets," he said.

At the Hanover Fair, Chinese exhibitors could be seen in almost every exhibition hall.

"I feel that it is a very good strategy of Chinese companies to be here year by year continuously on the trade show," said Jochen Koeckler, a member of the Managing Board of Deutsche Messe responsible for the fair.

"That is a strong signal that China is really willing to be more open, and is willing to be one of the industrial nations of the world."

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Permalink 11:41:58 am, by dacare, 612 words, 91 views   English (US)
Categories: News of China

Realty growth sinks to single-digit level

A man inspects a property model display on June 14, 2014 in Rizhao, Shandong province.

Housing sales remain soft despite several policy easing measures announced by government

First-quarter investment in the real estate industry plunged to the lowest point in nearly six years, according to data released by the National Bureau of Statistics on Wednesday.

Investment in the property sector, a pillar of China's fixed-asset investment, expanded by 8.5 percent year-on-year, dipping from 10.4 percent in the first two months.

The pace of growth was the weakest since July 2009, which was the aftermath of the global financial crisis, and a far cry from the 30 percent-plus rates recorded just four years ago.

In the previous property downturn, which occurred in the second and third quarters of 2012, growth rates remained above 15 percent.

"China's property sector is still in a bad way. Prices continue to slide. Without a turnaround in loan growth, it's difficult to see a rebound in real estate," said Tom Orlik, chief Asia economist of Bloomberg.

Statistics suggest that investment growth in the sector is set for further slowdowns, which would drag down overall economic growth.

For example, funds raised by developers in the first quarter contracted 2.9 percent year-on-year, while new housing starts plunged 18.4 percent.

Yu Bin, a leading scholar with the Development Research Center of the State Council (cabinet), told a news conference earlier that real estate investment growth will decelerate further from 10.5 percent last year to about 7 percent this year. That would be about the same pace as the target for GDP growth.

In the longer term, property investment growth will stabilize in the 7 to 8 percent range, he said.

Investment is a lagging indicator that usually runs about three months behind changes in actual home sales, experts said. Given that relationship, last month's sales performance implies that investment will stabilize in the second half of this year.

First-quarter housing sales by area fell 9.8 percent, the NBS said. That was a big improvement from the whopping 17.8 percent contraction in the first two months.

Calculations by China Daily show that in March, home sales were just marginally below the year-earlier levels: 0.9 percent down by area and 0.2 percent lower in value.

The NBS does not provide single-month data.

However, policy loosening in late March failed to ignite sales, to the surprise of many observers. After a soft patch in the first week of April, sales in the second week continued to fall.

According to the China Index Academy, the research branch of SouFun Holdings Ltd, sales in the 38 cities it monitors fell 11.2 percent last week, compared with the previous week.

In late March, the central bank said that commercial banks could reduce their minimum down-payment requirements to 40 percent from 60 percent for buyers of second homes who have outstanding mortgages on their first homes.

Separately, tax authorities said that individuals selling an ordinary home would be exempt from the usual 5.5 percent tax if they had owned that unit for more than two years, down from five years previously.

The housing authorities also said that the government would curb land supplies in second-and third-tier cities in an effort to rein in oversupply there.

Ding Zuyu, president of China Real Estate Information Corp, said that several factors had undermined the effectiveness of the policy changes.

For one thing, the Qingming (tomb-sweeping) festival is considered an inauspicious time to buy a home. The holiday fell from April 4 to 6.

Another factor, according to Ding, is that the implementation of the support policies is taking time to trickle down to the local level. Further, supplies of new apartments dwindled during the festival.

As the policies take effect nationwide, their impact will be fully felt starting from the second half of April, he said.

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Permalink 02:04:34 pm, by dacare, 229 words, 92 views   English (US)
Categories: News of China, Comp, Salary & Benefit

Chinese household income continues to grow in Q1

The average per capita income of Chinese households continued to rise in the first quarter of the year, the National Bureau of Statistics (NBS) said Wednesday.

Average per capita household income rose 9.4 percent year on year to 6,087 yuan (992.30 U.S. dollars), recording 8.1 percent growth after inflation.

The household income growth rate for 2014 was 8 percent.

Per-capita disposable income for urban people hit 8,572 yuan, up 8.3 percent. The growth rate was 7 percent in real terms.

Disposable income for rural residents stood at 3,279 yuan, up 10 percent. In real terms, it climbed 8.9 percent.

The income gap narrowed with urban residents earning on average 2.61 times more than their rural counterparts, down from a calculation of 2.66 in the same period last year, according to the NBS spokesman Sheng Laiyun.

Income growth surpassed gross domestic product (GDP) growth in the first three months, which clocked in at 7 percent, down from the 7.3 percent registered in the fourth quarter of 2014.

This still meets the official annual growth target of around 7 percent for 2015.

China created 3.2 million new jobs in urban areas in the first quarter, said Sheng, adding an NBS survey showed that China's urban unemployment rate was "stable" at around 5.1 percent, unchanged from the rate in 2014.

The consumer price index, the main gauge of inflation, in the first quarter averaged 1.2 percent, the lowest since the fourth quarter of 2009 and lower than the government target of 3 percent, NBS announced Friday.

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Permalink 01:13:30 pm, by dacare, 357 words, 87 views   English (US)
Categories: News of China

Huawei aims high with innovation, entrepreneurship

From a company on a shoestring budget at the time of its founding to a world renowned telecommunications giant, Huawei Technologies proves that commitment to entrepreneurship and innovation pays off.

"The only reason why Huawei exists and flourishes is its aim to better serve customers," said rotating CEO Hu Houkun.

"The only way for Huawei to win the market's trust and respect is through diligence," Hu said.

Founded in 1987 with a registered capital of 21,000 yuan (3,400 U.S. dollars), Huawei took only eight years to achieve an annual sales of 1.5 billion yuan.

In 2004, Huawei launched a subsidiary in Britain. Within three years, it had orders from Germany, France, Italy and Spain.

At the end of March, the company reported a 32.7 percent increase in profits in 2014 to 27.9 billion yuan. Its revenue grew to 288 billion yuan, up 20.6 percent.

The growth was due partly to Huawei's development of consumer business, mainly smartphone sales. Consumer business revenue hit 75.1 billion yuan last year, up 32.6 percent.

A close look at the company's track record reveals the main driver behind its growth is its attention to innovation and research and development (R&D). In 2014, 40.8 billion yuan went on R&D, 29.4 percent more than in 2013 and 14 percent of revenue.

In the past decade, Huawei has spent more than 190 billion yuan on R&D. Among its 150,000 employees, more than 45 percent are engaged in innovation, research and development.

Huawei has been granted 36,511 patents and currently holds over 170 key positions in major international standards organizations, driving the improvement of industry standards.

"Huawei endeavors to offer the people of the whole world, especially in developing countries, fast and convenient connections at an affordable price." Hu said.

Huawei's ascent has not been free from obstacles: popularity breeds suspicion. Security forces in the U.S. and the UK accused the company of spying, but Huawei has been cleared through lack of evidence.

The UK's Huawei Cyber Security Evaluation Center, which includes representatives of the British government and intelligence services concluded in a report published at the end of last month that "any risk to UK national security from Huawei's involvement in the UK's critical networks have been sufficiently mitigated."

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Permalink 11:45:58 am, by dacare, 508 words, 164 views   English (US)
Categories: News of China

Beijing seeks new private investment to expand subway

Move comes after construction costs soar in past few years

Beijing plans to attract more nongovernment funds to fuel the rapid expansion of the subway network, the company responsible for providing finance and planning new projects has revealed.

Construction costs have almost doubled in the past six years, the Beijing Infrastructure Investment Co said.

The technical and economic performance index, which reflects construction costs, increased to 1 billion yuan ($161 million) per kilometer in 2014 for subway lines in the downtown area, according to figures released by the company. The corresponding figure in 2007 was 571 million yuan.

The municipal government has annual allocations to fund subway construction projects, and these reached 15.5 billion yuan in 2014.

Most of the money is provided by the company, which has invested more than 251.3 billion yuan in the network in recent years?enough to build 110 Bird's Nest stadiums or 246 Water Cube aquatics centers.

Now the capital's municipal government has released a guideline designed to attract more funds from private sources to finance large public projects, including the subway.

Yang Xuhui, an official at the Beijing Municipal Commission of Development and Reform, the city's top economic planner, said companies can invest either alone or as a part of a consortium.

"More than one company has shown an interest," he added.

Beijing was the first city on the Chinese mainland to build a metro system, and there are now 18 lines covering a total distance of 527 kilometers. The total is scheduled to reach around 1,000 kilometers by 2020 to meet the huge demand from the capital's population of more than 21 million. The expansion should ease traffic congestion and reduce air pollution.

The cost of materials, labor, machinery and land acquisition and resettlement has also continued to rise, and this has pushed up the amount of investment needed, the company said.

Metro construction projects in other cities have also been affected by rising costs. It is estimated that at least 3 trillion yuan will be invested nationwide in networks that will cover a total distance of 6,000 kilometers by 2020, official Li Guoyong told China Business Times. Li works in the infrastructure projects section of the National Development and Reform Commission, the country's top economic planning agency.

There are currently two companies involved in running the capital's network?city-owned Beijing Mass Transit Railway Operation Corp, and Beijing MTR Corp, a public-private joint venture with Hong Kong's MTR.

On Feb 8, Beijing MTR Corp paid 15 billion yuan for the right to operate Line 16 for 30 years. It already runs Line 4 and Line 14.

Safety is a major concern both during the construction process and after new lines open.

Le Guiping, a spokesman for Beijing MTR Construction Administration, which is in charge of building the company's projects, said: "We have a safety and emergency command center that monitors the whole process from construction of the facilities to test runs."

The center came into operation in January.

A second monitoring center is designed to ensure that lines operate safely. This supplies information about passenger flows and other data to the government to help it reach decisions on the future development of the network.

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Permalink 11:51:11 am, by dacare, 546 words, 100 views   English (US)
Categories: News of China

Intel offers olive branch of investment for growth

Intel Corp said on Wednesday that it will invest 120 million yuan ($19.3 million) to promote grass roots technology innovation in China amid deepening mistrust over information security between the United States and China.

Chief Executive Officer Brian Krzanich has sought to placate the Chinese authorities by pledging wider collaboration with local institutes and universities.

The moves came as the US added three major partners of Intel in the supercomputing sector to a technology embargo list.

Krzanich said that the vibrant atmosphere of innovation in China will help Intel find new business opportunities beyond personal computers and other traditional information technology sectors. "There is a huge opportunity for Intel to continue to grow together (with China). This growth is being driven by the public cloud, network transformation, big data and new IT services," he said.

About 80 million yuan of the investment will be used to set up an angel investment fund. It will be the first seed-stage fund for Intel, and it will focus on companies preparing for going public.

The investment is evidently an attempt to butter up the Chinese officials. Earlier this year, in a move to boost the slowing economy, the central government encouraged individuals to start their own businesses. Ian Yang, president of Intel China, said that the newly announced investments are in line with that strategy.

Intel said that it is also considering deeper research ties with local universities. Chengdu-based Southwest Jiaotong University and Tsinghua University in Beijing are the first partners of the Intel innovation project.

"It is not good enough to bring products that we already developed or already used elsewhere. A real partnership means you bring it first to China," Krzanich said. "We want to share pioneering ideas up front with China."

Antonio Wang, an analyst at consultancy International Data Corp, said a good relationship with the government is becoming critical for Intel and other overseas technology companies because of the "panic" over IT security.

Intel may have to cut loose some of its top research partners in China because of a new order from the US government. Supercomputer centers based in Guangdong province and Tianjin municipality and one at a military academy?the National University of Defense Technology in Hunan province?have been added to a US "Denial List" that bans advanced technologies from being sold to these organizations, US-based technology Website vrworld.com reported on Tuesday.

The report said the ban may damage sales of Intel's Xeon Phi accelerator because the institutes are making the world's fastest supercomputers and will need vast volumes of high-end Intel devices.

Multiple sources at Intel confirmed to China Daily that the US had blacklisted these customers, but they said it was unlikely to harm Xeon products' sales.

"The ban only covers research cooperation that may pose threats to the US. On-market product sales will not be affected," one of the sources said.

China and the US have stepped up information security in the past year, with both claiming to be victims of online espionage.

China is also seeking to ensure IT security by imposing new industry standards. Some foreign technology providers have said these moves are intended to oust foreign companies from the government procurement sector.

Chinese regulators have denied that accusation, saying that local companies must also abide by the regulations.

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