Archive for ‘Economics’

20/09/2014

China approves plan to combat climate change – China – Chinadaily.com.cn

The Chinese central government on Friday approved a plan that maps out major climate change goals to be met by 2020.

The State Council, China’s cabinet, gave a green light to the plan, which was proposed by the National Development and Reform Commission (NDRC), the country’s economic planner. A statement released on the State Council’s website urged the NDRC to carry out the plan.

China has pledged to reduce its carbon emission intensity, namely emissions per unit of GDP, by 40 percent to 45 percent by 2020 from the 2005 level. It will also aim to bring the proportion of non-fossil fuels to about 15 percent of its total primary energy consumption.

Other targets include increasing forest coverage by 40 million hectares within the next five years.

The government will speed up efforts to establish a carbon emission permit market, under the plan, which also calls for deepened international cooperation under the principles of “common but differentiated responsibilities,” equity and respective capability.

The State Council said local governments and departments at all levels should recognize the significance and urgency in dealing with climate change and give higher priority to action on this issue.

China’s release of the action plan came just before a climate summit to be held at UN Headquarters in New York on Tuesday. Chinese Vice Premier Zhang Gaoli will attend.

Xie Zhenhua, deputy chief of the NDRC and the country’s top official on climate change, told a press conference that the plan was concrete action by China to participate in the global process to tackle climate change.

By the end of last year, China had reduced carbon dioxide emissions per unit of GDP by 28.56 percent from 2005, which was equivalent to saving the world 2.5 billion tonnes of carbon dioxide emissions, Xie said.

At the end of 2013, China’s consumption ratio of non-fossil energy to primary energy stood at 9.8 percent. Forest growing stock had increased by 1.3 trillion cubic meters from 2005 to two trillion cubic meters, seven years ahead of schedule, according to the official.

In the first nine months of 2014, China’s energy consumption per unit of GDP dropped by 4.2 percent year on year and carbon intensity was cut by about 5 percent, both representing the largest drops in years, he said.

As a developing country, China is the world’s largest greenhouse gas emitter. With the plan, the country has showed its confidence in achieving its green goals.

via China approves plan to combat climate change – China – Chinadaily.com.cn.

20/09/2014

Huawei: The great disrupter’s new targets | The Economist

“THE last time there were so many people down by here, the Rolling Stones were in town.” So declared one of those attending an unusual gathering this week in a vast auditorium along the shores of Shanghai’s Huangpu River. The music was blaring, the coloured lights flashing and the ceiling shimmering, but this was not another rock concert. Astonishingly, the enthusiastic throngs—10,000 squeezed into the venue and another 13,000 joined in via streaming video—had gathered for a technology conference.

The gig was organised by Huawei, a Chinese maker of telecoms equipment, which used the occasion to unveil a new business strategy. As they strode across the stage in front of a video screen nearly as wide as a football pitch, Huawei’s bosses declared their aim of making their firm the world’s leading information-technology (IT) company. In the first stage of this, Huawei plans to increase its sales of servers, storage and other data-centre equipment by a factor of ten by 2020. Last year such products brought in only about $1 billion of Huawei’s total revenues of $39 billion.

It is an audacious goal. It pits Huawei against such titans as IBM, Cisco and HP—innovative giants with deep customer relationships and comprehensive offerings that Huawei cannot yet match. Then again, a decade or so ago Huawei faced a similar challenge in telecoms equipment and has grown to become one of the world’s dominant vendors. It has also become big in smartphones. Evan Zeng of Gartner, a consulting firm, says Huawei starts with an edge in China’s fast-growing market, where state-owned firms favour domestic suppliers. That said, it has some strong local rivals, notably Lenovo and ZTE.

Bryan Wang of Forrester Research, another consulting firm, says Huawei is taking on this daunting challenge because the telecoms-equipment market has become saturated and is set to grow only sluggishly. The IT business is also crowded. But it is a far bigger market than telecoms equipment, and Huawei, since it has such a small share of it, has enormous scope for growth.

In an attempt to keep the company nimble, Huawei recently introduced a system in which three of its bosses take turns, six months at a time, at being the chief executive. Guo Ping, who is in charge at the moment, argues that the telecoms operators that are now his firm’s main customers are embracing cloud computing, so it makes sense for Huawei to make sure it can provide all the gear they need to do so.

Second, Mr Guo argues, the long-predicted convergence of the telecoms and IT businesses is finally happening. The switching of telecoms and internet traffic will no longer require so much of the costly, specialist hardware that Huawei now makes. Increasingly, the job will be done by software, which will run on cheaper, standard IT equipment—what is known as “software-defined networking”. Huawei is seeking to get ahead of this disruption of its core business by being a disrupter itself.

There are good reasons to think Huawei may be up to the challenge. As a privately-held company, “its managers don’t have quarterly pressure, and can invest for the long term,” notes Mark Gibbs of SAP, a German software firm that works closely with Huawei. Ryan Ding, Huawei’s head of product development, recalls that his firm stuck with its efforts to penetrate the markets for routers and LAN switches—two important bits of telecoms gear—despite losing money on each for more than a decade. Likewise, this year it is pumping $600m, or more than half of its entire revenues from IT products, into researching future ones.

Huawei is a proven innovator entering a bloated industry, ripe for change. Its bosses speak clearly and compellingly about what innovation is for: not to win Nobel prizes, or plaudits in the media for the “coolness” of its products, but to create value for customers. To this end, Huawei stations armies of engineers at 28 “joint innovation centres” at customers’ sites around the world. “My guys don’t just ask the customer what he wants: they go to the field site together, do the installation together, and figure out together how to increase efficiencies,” boasts Mr Ding.

The American and European giants of IT have been put on notice. Mr Wang of Forrester says Huawei has already shown it can deliver a potent combination of price, service and customisation. That is why he feels sure it will disrupt the IT business just as it did with telecoms.

via Huawei: The great disrupter’s new targets | The Economist.

20/09/2014

Modi Uses Another International Visit to Raise His Local Profile – India Real Time – WSJ

Prime Minister Narendra Modi’s meetings with Chinese President Xi Jinping this week once again showed that Mr. Modi is a master of media management.

The summit of the heads of the world’s two most-populous countries produced mixed results. A lot of agreements were signed, but the $100 billion in Chinese investment pledges that some local media had predicted did not materialize. And just as the leaders were shaking hands, there was an embarrassing faceoff between Chinese and Indian troops along the countries’ disputed boundary.

That didn’t stop India’s prime minister from again using photo opportunities and body language to broadcast his confidence, an impression that is likely to remain long after local media stop discussing the border tension and whether China had promised enough money.

Indians watching the visit wouldn’t have missed some of the symbolism. Mr. Xi flew into Mr. Modi’s home state, on the Indian prime minister’s birthday. Mr. Xi wore an  Indian vest that Mr. Modi gave him. Video of the two showed Mr. Modi walking in front of Mr. Xi at one event and swinging on a swing with him. At one point it even looked like Mr. Xi was carrying an umbrella for Mr. Modi.

Reuters Xi Jinping looked like he was carrying an umbrella for Narendra Modi during a recent visit to Gujarat.

The Indian prime minister has used the same charisma in photo ops during other international summits, most recently in Japan where he gave Prime Minister Shinzo Abe a big bear hug and later performed a solo on traditional Japanese drums.

All of this has been beamed into Indian homes and marks a major change from the demeanor of the country’s previous prime minister, Manmohan Singh, who was soft- spoken and slow-moving.

Mr. Modi’s multimedia skills are one of the things that made him prime minister.  Whether it is his controversial selfies, the sight of hundreds of supporters wearing Modi masks, campaign speeches delivered through hologram, his stylish outfits or his willingness to put on almost any kind of regional headwear, Mr. Modi knows how to make an impression.

via Modi Uses Another International Visit to Raise His Local Profile – India Real Time – WSJ.

18/09/2014

Trade, investment hopes as China’s Xi visits India – Businessweek

Chinese President Xi Jinping landed in the Indian prime minister‘s home state of Gujarat on Wednesday for a three-day visit expected to focus on India’s need to improve worn out infrastructure and reduce its trade deficit.

Xi was greeted on the tarmac by state officials carrying fringed umbrellas to guard him from the sun in Gujarat’s main financial city of Ahmedabad.

Prime Minister Narendra Modi is expected to court Chinese business and seek investment to upgrade creaky infrastructure, banking on China’s track record at building highways, railways, and industrial zones. India is also eager to address the imbalance in their annual trade, which now totals around $65 billion but is skewed toward imports of Chinese electrical equipment and parts.

Modi and the Gujarat government are staging a lavish welcome for Xi, with billboards across Ahmedabad showing a smiling Modi and Xi. A banquet dinner was being held Wednesday night on the banks of the Sabarmati River in Ahmedabad. Modi was also celebrating his 64th birthday.

Xi has been equally effusive in expressing excitement for the visit.

China-India relations have become one of the most dynamic and promising bilateral relations in the 21st century,” Xi wrote in an article published Wednesday in The Hindu newspaper.

via Trade, investment hopes as China’s Xi visits India – Businessweek.

18/09/2014

Chinese Well-Being Is Low, Global Survey Shows – Businessweek

Despite years of rapid economic growth and rising incomes, Chinese aren’t feeling so great about themselves. And Chinese from the countryside are feeling even worse. That’s revealed by a new survey focusing on global well-being, released yesterday for the first time by polling agency Gallup and Healthways (HWAY) in Franklin, Tenn.

The Global Well-Being Index is designed as an alternative to traditional objective measures, such as GDP, life expectancy, and population size, the report explains. Instead, the index, which canvassed 133,000 people in 135 countries and regions, serves as “a global barometer of individuals’ perceptions of their well-being.” It’s important because people with higher well-being are “healthier, more productive, and more resilient in the face of challenges such as unemployment,” the report notes.

To find out just how people feel, the survey looked at five categories of perceived well-being, including financial and physical well-being, but also social well-being (“having supportive relationships and love in your life”), community well-being (“liking where you live, feeling safe, and having pride in your community”), and purpose well-being (“liking what you do each day and being motivated to achieve your goals”).

So where did the Chinese reveal themselves as particularly glum? On purpose, or feeling motivated every day, 35 percent of Chinese characterized their well-being as low, and 56 percent said it was moderate, while just 9 percent rated it as high. That compared with 13 percent of respondents in Asia who said they had high well-being, and twice as many, or 18 percent, globally.

On social and community well-being, the Chinese also lagged the rest of Asia and the world. And among rural Chinese, far fewer people expressed high satisfaction with their communities than urban Chinese— just 14 percent for those in the countryside, compared to 23 percent in cities. “With better access to education, entertainment, and employment opportunities, it’s not surprising that urban Chinese are more likely to be satisfied with their communities,” the reports says.

That split within China shows up when it comes to financial security, as well. Overall, the Chinese scored highly (Chinese overall also scored well in physical well-being), with 25 percent expressing high financial well-being, the same as the regional and global average. Yet the rate of those with low financial well-being among rural Chinese was twice that of those in Chinese cities, “speaking to China’s ongoing struggle with income inequality that has resulted from rapid growth,” according to the report.

via Chinese Well-Being Is Low, Global Survey Shows – Businessweek.

18/09/2014

India to hold talks with China on civil nuclear cooperation | Reuters

India will open talks on civil nuclear energy cooperation with China, Prime Minister Narendra Modi said on Thursday after summit talks with Chinese President Xi Jinping in New Delhi.

The announcement, part of the new government’s push to broaden its nuclear energy sector, comes on the heels of a deal India struck this month to buy uranium from Australia to increase its fuel supplies.

“We will begin the process of discussions on civil nuclear energy cooperation that will bolster our broader cooperation on energy security,” Modi said in a statement, with Xi beside him, at a news conference.

Ahead of Xi’s visit, Chinese Assistant Foreign Minister Liu Jianchao told reporters that China had a “positive attitude” towards nuclear cooperation with India, but offered no details.

Behind the scenes, China has been pressing India hard to begin talks on civil nuclear cooperation, said W.P.S. Sidhu, a senior fellow at Brookings India.

Any deal for India to buy civil nuclear reactors from China may take years, but both countries benefit by starting the conversation, said Sidhu.

“It’s a way for India to explore other options,” he said.

via India to hold talks with China on civil nuclear cooperation | Reuters.

18/09/2014

India’s rice output, exports to climb on revival of monsoon | Business Standard News

India’s summer-sown rice output is likely to cross the previous year’s level due to a pick up in monsoon rains, raising prospects for higher overseas sales in 2015 by the world’s biggest exporter of the grain, trade officials said.

Robust exports from India could keep a lid on global prices that have surged 12% in the past three months and help cut bulging government stockpiles built as a result of bumper harvests over the past several years.

“There were concerns over production due to poor rainfall in June. The pick-up in rains from mid-July changed the situation. Now, the crop is in good shape,” said B.V. Krishna Rao, managing director of Pattabhi Agro Foods Pvt Ltd, a leading exporter.

In June, monsoon rains were 43% lower than the 50-year average, raising concerns about output of the rice crop that guzzles a lot of water. But rains picked up in the past few weeks, narrowing the rainfall deficit to 11%.

“Overall rice production will definitely be higher than last year but it is a little early to quantify by how much,” said Rajen Sundareshan, executive director of the All India Rice Exporters Association.

via India’s rice output, exports to climb on revival of monsoon | Business Standard News.

18/09/2014

N. Korea, China to open major bridge next month

North Korea and China are set to open a major suspension bridge across the Amnok River in October, paving the way for closer economic relations between the allies, China’s state media reported Thursday.

The 3-kilometer, 2.2 billion yuan (US$357 million) bridge links the North’s border city of Sinuiju to the neighboring Chinese city of Dandong over the river, also called the Yalu River in China. Dandong handles more than 70 percent of bilateral trade with North Korea.

The official China News Service, without citing any sources, reported that the bridge will be opened in October, when the two nations hold a joint trade fair in Dandong.

If the Chinese-funded bridge opens, the report said, “Dandong will become more important in China-North Korea trade.”

The bridge illustrates the view in China that economic engagement with North Korea is a prerequisite to persuading it to abandon its nuclear weapons program, and its resistance to U.S. calls to exert more economic leverage to restrain the regime.

A series of provocations by the North, including last year’s nuclear test, have strained political ties with its last-remaining ally, China. Still, many analysts believe that Beijing will not put strong pressure on Pyongyang due to the risk of aggravating the current situation.

via N. Korea, China to open major bridge next month.

18/09/2014

Despite the Xi-Modi bromance, Indians and Chinese don’t actually like each other

One in two Indians thinks China is a major threat.

In the last two days alone, Chinese President Xi Jinping has called India an ancient, magic, enchanting, and beautiful land. And Indian Prime Minister Narendra Modi has reciprocated with syrupy adjectives, reminding visiting journalists how ancient Chinese technology was responsible for sugar being called cheeni in India.

The pictures of the two leaders’ bonhomie on Wednesday went even further. By the time you get to the sight of Modi and Xi sitting on a swing by the Sabarmati, most would imagine that India and China are steadfast allies who support each other through thick and thin.

Which is why it might be worth pointing out that we don’t actually like each other very much, and that Indians and Chinese people have very different intentions for the bilateral relationship. And it’s not just about the trade deficit and the border disputes. Ordinary Indians and Chinese people simply aren’t sure whether they like each other.

via Scroll.in – News. Politics. Culture..

17/09/2014

Could India Edge Out China? – Businessweek

China’s President Xi Jinping is due to arrive in India tomorrow, and for a change he’s the one with an economy heading in the wrong direction, not Indian Prime Minister Narendra Modi. After several dismal years, growth in India is rebounding, and the stock prices of companies selling to Indian consumers are benefiting from the surge in optimism that accompanied Modi’s landslide election victory in May. Britannia Industries (BRIT:IN), the Kolkata-based maker of cookies and other food products, is up 55 percent so far this year and today hit a 52-week high. “The Indian consumption story is back,” Credit Suisse analysts Neelkanth Mishra and Ravi Shankar wrote in a report published today.

Electronic ticker boards at the National Stock Exchange in Mumbai, India

Meanwhile, China is struggling as the troubled banking system and property markets put a damper on the economy. Hit by a slump in the property market, the Chinese economy expanded at an annual rate of 6.3 percent in August, a dramatic slowdown from the 7.4 percent growth in July and nowhere close to the government’s target of 7.5 percent. So far this year, the area of new property under development has declined 14.4 percent. The data from last month “made depressing reading,” Bloomberg economist Tom Orlik wrote in a report published yesterday.

The role reversal could lead to a world-turned-upside-down moment as early as 2016. That’s when India, always the laggard, may pull ahead of China and became the fastest-growing of Asia’s giants. India is likely to enjoy 7.2 percent growth in 2016, says Rajeev Malik, senior economist in Singapore with CLSA, compared with China’s 7.1 percent. Given the structural problems Xi faces and the slack Modi inherited, “China has to slow down, and India can do much better,” he says.

India has suffered from a chronically high inflation rate, but there are signs that pressure is easing, albeit slowly. Consumer prices last month rose 7.8 percent, a slight improvement from July’s 7.96 percent. Yesterday, the government reported wholesale prices rose 3.74 percent in August. That’s the best result in five years.

via Could India Edge Out China? – Businessweek.

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