Recruiting in China

Moving 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

Chinese 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 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.

China'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.

British 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, 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.