Posts tagged ‘Hong Kong’

17/09/2014

Is China Ready to Step Up and Invest in India? – India Real Time – WSJ

While Chinese companies have been great at peddling their products in India, they have been surprisingly reluctant to invest here. China has invested less in India than even Poland, Malaysia or Canada have.

President Xi Jinping’s three-day visit to India starting Wednesday is likely to include some massive pledges to try to remedy this imbalance.

When Prime Minister Narendra Modi visited Japan recently, Japan pledged to invest $35 billion in India. President Xi is expected to try to eclipse Japan’s promises, possibly pledging $100 billion in investment according to some local reports. His meetings with Mr. Modi are predicted to lay the groundwork for a wave of Chinese money to build industrial parks and bullet trains.

Annual trade between India and China has galloped to $66 billion from $3 billion 14 years ago, something that underscores the rise of Beijing as the global manufacturing hub and India’s growing appetite for everything from phones to machinery from China.

While the trade relationship between the two countries has bloomed, foreign direct investment from China has not. According to Indian government statistics, the country has received a total of around $400 million from China in investment in the last 14 years. Even if you add the $1.2 billion of direct investment India received from Hong Kong, China is still well behind the $22 billion in foreign direct investment from the United Kingdom, $17 billion from Japan, $13 billion from the Netherlands and $1.9 billion from Spain.

It’s not that China doesn’t invest abroad. According to data from United Nations Conference on Trade and Development, China was the third biggest source of foreign direct investment last year, having invested more than $100 billion in other countries. In the seven years to 2012, it invested more than $25 billion in the 10 members of the Association of Southeast Asian Nations alone.

Chinese investment has tended to focus on the resources sector to power its economy. Much of it has gone into getting control of oil, natural gas and coal in Africa, Australia, Indonesia and elsewhere. India has not attracted much of this investment as it is a net importer of resources and has a heavily regulated energy sector, said Rajiv Biswas, economist for IHS.

“China wants to increase investment in India and wants Chinese companies on the ground there,” Mr. Biswas said. “Most of it will be in manufacturing and infrastructure space.”

Chinese companies may also be looking to move some of their manufacturing to India as they struggle with rising wages at home, said Ajay Sahai, director general and chief executive at Federation of India Export Organization.

If India can’t find better ways to fix its trade imbalance with China, New Delhi may want to increase taxes on some imports such as auto-components and pharmaceuticals to encourage Chinese companies to set up factories in India, he said.

“This will not only raise Chinese investment in India but also help in fixing the trade imbalance,” said Mr. Sahai.

via Is China Ready to Step Up and Invest in India? – India Real Time – WSJ.

16/09/2014

Almost Half of China’s Rich Want to Emigrate – Businessweek

Even as the number of Chinese millionaires grows, the number of those aiming to leave China is getting ever larger.

A shopper at Lee Gardens mall in the Causeway Bay district of Hong Kong

About half of China’s wealthy are considering moving to a new country within five years, says a just-released report by U.K.-based bank Barclays. The survey of more than 2,000 individuals around the world, all with personal wealth over $1.5 million, showed Chinese are more eager to emigrate than the very well-off in any other region.

Forty-seven percent of rich Chinese planned to move abroad in the next half-decade. That compared with 23 percent in Singapore and 16 percent in Hong Kong. One-fifth of rich Brits intended to emigrate, while only 6 percent of Americans and 5 percent of Indians had that plan, reported the South China Morning Post today, citing the report.

Not surprisingly, given China’s high-pressure, exam-based school system, bettering children’s education and improving their future job prospects were named as the main reasons to emigrate by 78 percent of respondents. A better economic situation was mentioned by 73 percent, while health care and social services were cited by 18 percent; the U.S. and Europe were the favored destinations.

“The reality is that most ultra-high net worth individuals in China are probably making money in China right now,” noted Liam Bailey, head of residential research at London brokerage Knight Frank, in the report. “So, for business reasons, they need to be relatively close. That might prevent some of them going further afield.”

via Almost Half of China’s Rich Want to Emigrate – Businessweek.

11/09/2014

Can Jack Ma’s Alibaba Fortune Jump-Start Chinese Philanthropy? – Businessweek

Harvard just announced its largest-ever donation: a $350 million unrestricted gift to its School of Public Health. The donor is Hong Kong-based Morningside Foundation, led by two brothers who earned their fortunes in real estate, private equity, and venture capital. One brother, Gerald Chan, earned a graduate degree from Harvard. The school will be renamed in honor of their late father as the Harvard T.H. Chan School of Public Health.

Jack Ma on July 15

Greater China is home to 358 billionaires (including 64 Hong Kong billionaires), according to the 2014 Hurun Global Rich List. Yet with a few exceptions—including the Harvard gift and Chinese tech titans’ recent fondness for the ice bucket challenge—a culture of domestic philanthropy has been relatively slow to take root. Bill Gates and Warren Buffet hosted a lavish 2010 dinner in Beijing intended to encourage the Chinese elite to embrace philanthropy, but several tycoons snubbed the Americans’ invitations and declined to open their wallets.

Now, at last, China has a powerful homegrown evangelist for philanthropy: Jack Ma. As co-founder and executive chairman of Alibaba Group, which filed paperwork last week to raise as much as  $21.2 billion in an initial public offering on the New York Stock Exchange, he is one of China’s most respected and closely watched tycoons—and he’s publicly embracing a culture of giving.

Ma joined Alibaba co-founder Joe Tsai earlier this year in establishing a personal philanthropic trust to be “funded by share options granted by Alibaba … for approximately two percent (2%) of Alibaba’s equity,” according to a statement. The trust will focus on the “environment, medicine, education, and culture.” In Ma’s words, “Alibaba was founded 15 years ago with a mission ‘to make it easy to do business anywhere’ and a set of principles and values that emphasize our responsibility to society. Giving back to society is deeply embedded in Alibaba’s culture.”

The total value of the fund will depend on the performance of Alibaba’s upcoming IPO. If the company is valued at $120 billion, or more, the charitable trust will be worth at least $2.4 billion.

via Can Jack Ma’s Alibaba Fortune Jump-Start Chinese Philanthropy? – Businessweek.

04/09/2014

Democracy for Hong Kong: Unyielding | The Economist

PRO-DEMOCRACY activists announced the start of a “new era of civil disobedience” on the night of August 31st, after China’s top legislature laid down restrictive guidelines on the kind of elections that are allowed in Hong Kong, a semi-autonomous territory. Officials in Beijing had promised to allow the election of Hong Kong’s next leader, in 2017, through universal suffrage. With the announcement China has clarified that there is a catch, a big one: the government sees itself as being under no obligation to allow open nominations for the election’s candidates. Before the announcement, Chen Zuoer, one of the officials who helped negotiate Hong Kong’s handover to mainland China back in 1997, had warned that “blood will be shed” if their opponents refuse to back down.

In a show of defiance, an alliance of activists who support fully open elections held a rally on Sunday night to declare that it would launch waves of protests, culminating in the occupation of the city’s main financial district. Their movement has been many months in the making; they call it “Occupy Central with Love and Peace”. It was first proposed nearly two years ago by Benny Tai, an associate law professor at the University of Hong Kong, in anticipation of a disappointing official interpretation of “universal suffrage”—just like the one that the central government has now given them.

Police arrested at least 22 people during protests that began on Sunday night and carried through Monday morning. The student-union president at the Chinese University of Hong Kong has announced a strike; students there will have a rally of their own on September 4th around a replica of the “Goddess of Democracy” statue that became famous for its appearance in Tiananmen Square in 1989. Other universities are expected to see strikes of their own announced in the next few days.

Many of the participants at Sunday’s rally despair at convincing the bureaucrats in Beijing to change their position—but they feel they need to put up a fight anyway. “Normal protests are no longer useful,” in the words of Agnes Chow Ting, a student protester. She led a failed attempt after the rally to “ambush” a delegation of officials from the central government.

Such actions may attract international attention but indeed, they are less than likely to sway decision-makers in Beijing. Li Fei, a deputy secretary-general of the National People’s Congress Standing Committee, told local politicians on September 1st that the committee believes Hong Kong’s police will be capable of handling any disturbance that might be caused by “a small group of people seeking to undermine Hong Kong”, as he characterises the Occupy movement.

Hong Kong’s current chief executive, Leung Chun-ying, was picked for the role in 2012 by a 1,200-member “election committee”. A reliable majority of that committee were Hong Kongers who will ever be glad to demonstrate loyalty to their counterparts in Beijing.

via Democracy for Hong Kong: Unyielding | The Economist.

26/08/2014

China Says Celebs Have to Actually Try the Products They Endorse – China Real Time Report – WSJ

Celebrities who endorse ads for products they don’t try may need to start being a guinea pig in China.

On Monday, an updated draft of the Central Party’s advertisement law submitted to lawmakers said that celebrities who are paid to be spokespeople for products, should try the product before they represent it, according to state media. The goods and services celebrities endorse need to be “based on facts,” the draft says.

False endorsements have been a big problem in China and across Asia. In 2006, Hong Kong actress Carina Lau was sued after she endorsed a luxury Japanese skincare cream, which she said could reduce wrinkles by 50% after a month of use. Later, it was discovered that the cream contained harmful chemicals, including toxic metals chromium and neodymium, and that some consumers had adverse reactions to the cream. (The Japanese skincare brand, SK-II, was fined 200,000 yuan, or about $32,500, for false advertising.)

More recently, Jackie Chan endorsed one of Bawang International’s anti-hair loss herbal shampoos. After a Hong Kong-based magazine revealed that the shampoo contained a substance that may cause cancer, Mr. Chan responded. “I have always been very careful with what products I endorse. But there are some media who are specifically gunning for me and a few other artistes, I am not sure why, as though it is better that we all just died.” .(For its part, Bawang said its products had passed quality tests and that many shampoos and cleaning products contain small traces of carcinogens.)

The revision comes on the heels of last year’s revised Law on Protection of the Rights and Interests of Consumers, which states that celebrities who appear in misleading commercials, and the media that broadcast the ads, are legally liable.

Monday’s updated law reinforces celebs’ legal liability and says their “illegal income” can be confiscated if they stump for false advertising. They could also face hefty fines.

But it isn’t exactly clear how the law will be enforced or whether the government can actually monitor whether celebrities actually try out the products they promote.

via China Says Celebs Have to Actually Try the Products They Endorse – China Real Time Report – WSJ.

21/08/2014

Bosses at China’s state-owned enterprises face pay cuts of up to 50pc | South China Morning Post

Officials in charge of China’s state-owned enterprises face pay cuts of up to 50 per cent and new job descriptions under a reform plan approved by President Xi Jinping.

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Xi said at a meeting on Monday that China needed to speed up reform targeting the salaries of top executives at SOEs. He also approved a seven-year overhaul of their management structure.

Sources say the reform plan involves two steps.

The first is to cut the salaries of top executives at major SOEs, particularly those in finance and banking. Some may have to take a 50 per cent pay cut.

The second step is to gradually change their job responsibilities. The government-appointed officials will probably join the board of directors. The day-to-day operations will be handled by senior managers recruited from outside, with salaries in line with international standards.

The new model will be similar to that of the MTR Corporation in Hong Kong. As the major shareholder, the Hong Kong government appoints three representatives to the board of directors to ensure the firm follows its policy direction. The day-to-day operations, however, are run by top managers hired through an open recruitment process.

The reform is to address public discontent over the ambiguous status of top SOE managers, particularly those in charge of the so-called central enterprises directly under the State Council. Most of these top executives carry a vice-ministerial or ministerial-level ranking that comes with perks and privileges. At the same time, they are paid like top Western business executives and earn many times more than their fellow officials.

There has been criticism that the high salaries are unwarranted because many SOEs operate as monopolies or near-monopolies.

An executive of an energy industry SOE said the head of a central enterprise in his field could make one million yuan (HK$1.26 million) a year. Those working for banking and finance central enterprises could earn more.

Jiang Jianqing, the chairman of the Industrial and Commercial Bank of China, was paid nearly two million yuan in 2013. In comparison, the annual salary of some ministry-level party cadres is about 200,000 yuan. Yet some top executives point to their counterparts in the West and complain their incomes are too low.

via Bosses at China’s state-owned enterprises face pay cuts of up to 50pc | South China Morning Post.

14/08/2014

Chinese Buyers Are Driving a Boom in Australian Real Estate – China Real Time Report – WSJ

Australian house prices are rising quickly and demand from China is increasingly driving the boom, according to a report by Hong Kong-based brokerage CLSA.

The report, based on interviews with 50 industry participants in Australia, including major realtors, finds Chinese are now “driving the residential property market Down Under” adding that the “phenomenal investment” will continue for at least three more years.

CLSA says China is now the top source of foreign-capital investment in Australian real estate and anecdotal evidence indicates that foreign investment from China has continued to increase in 2014, having slowly accelerated over the last 5 years. The stock brokerage did not attempt to put a value on the investment.

CLSA said good education and a clean environment were driving demand from China.

“Australia offers both and we see no reason why its fundamental appeal will diminish,” it added.

There are currently only limited curbs on foreign buying of Australian property. Any newly built Australian property can be bought by foreigners . The purchase of existing properties needs the approval of Australia’s Foreign Investment Review Board.

Government data this week showed house prices nationally grew by 10% in the year-to-June 30, with Sydney prices racing at 15% over the same period.

The issue of Chinese investment in Australian housing investment has prompted concern among Australians about the potential to be frozen out of the housing market, especially the highly desirable inner city markets of Sydney and Melbourne.

A government investigation into the issue of foreign investment in Australian property is underway and will report its recommendations in October.  One of the limitations of the debate over the issue is that there is not reliable data on how much money is coming into property from overseas.

Australia’s central bank has been watching the rise in house prices but has so far downplayed the role Chinese money has had on prices growth. If house prices continue to climb, the reserve Bank of Australia might have to raise interest rates at a time when the economy is weak and unemployment at more than decade highs.

via Chinese Buyers Are Driving a Boom in Australian Real Estate – China Real Time Report – WSJ.

05/08/2014

Samsung Loses Top Spot to Micromax in India – India Real Time – WSJ

Samsung Electronics Co.005930.SE -0.08% was dethroned as the top cellphone seller in India last quarter as local rival, Micromax Informatics Ltd., undercut and outsold the Korean company for the first time in Asia’s third-largest economy.

Micromax which was launched only five years ago, has taken the pole position in the Indian market—the second largest in the world in terms of handset sales—by undercutting the prices of Samsung and other international brands.

In the April-through-June quarter Micromax’s market share reached 17% of the Indian market compared to Samsung’s 14%, according to Counterpoint Technology Market Research, a research and consulting company based in Hong Kong.

Samsung, the world’s largest cellphone company by sales, is facing tough competition from Micromax and other Indian handset sellers. The South Korean company lost its top spot in terms of handset volumes as it has shifted its focus to smartphones and away from the less-expensive feature phones, said Neil Shah an analyst at Counterpoint.

Micromax has been more successful than most at targeting the Indian consumer. In the past five years it has come out of nowhere by investing heavily in advertising, distribution and developing a portfolio of relatively inexpensive handsets for Indians.

Samsung may be trying to claw back some of its market share. The company, last week, added three more smartphones to its “affordable” category of handsets priced below 10,000 rupees.

via Samsung Loses Top Spot to Micromax in India – India Real Time – WSJ.

17/07/2014

Chinese Searchers Are Rallied After Giant Yellow Duck Goes Missing – China Real Time Report – WSJ

Lost: one giant yellow rubber duck, last seen on a river in southwestern China.

A 54-foot tall inflated duck, the trademark creation of Dutch artist Florentijn Hofman, is on the run after disappearing from a river in China’s southwestern Guiyang city, where it was being displayed for locals.

On Wednesday evening, after floating peacefully for a couple weeks, the duck was lashed by a heavy storm. “The duck flopped over and was flushed away really quickly by the torrential flood. It disappeared right in front of me in several seconds,” Yan Jianxin, who helped coordinate the duck exhibition on behalf of a local company, told China Real Time.

In recent days, floods have hit cities in central and southwestern China, killing at least 32 and displacing tens of thousands. Still, given the size of the duck, some were surprised it too was susceptible.

“The duck itself weighed around one ton, together with its over 10-ton floating metal platform, and several steel wires fixing it to the bottom of the river,” said Mr. Yan. All those preparations, though, “didn’t stop it from being flushed away by the flood.”

So far, Mr. Yan’s duck hunt hasn’t achieved anything yet. But other locals have also joined in the search, with one local radio station urging people on Weibo to step up the hunt, saying, “If you live along the river and see an 18-meter tall big yellow duck, please call 5961027.”

“This never happened in the duck’s tour history,” said Yu-Mei Sung, marketing specialist from Blue Dragon, a Taipei-based art company which she said is responsible for facilitating the tour of Mr. Hofman’s duck throughout China.

“Mr. Hofman feels very sorry about what happened in Guiyang and he hopes people are safe and all the damage will be repaired very soon,” Blue Dragon added in a later statement.

A back-up duck order from an authorized Taiwan maker is on the way and is expected to arrive in two days, just in case the missing one is never found or is unrepairable when found, according to Ms. Sung.

This isn’t the first time Mr. Hofman’s duck has suffered hiccups in China. Last May, the giant duck deflated into a forlorn yellow puddle during its exhibition in Hong Kong, prompting an anguished outcry across social media around the world.

via Chinese Searchers Are Rallied After Giant Yellow Duck Goes Missing – China Real Time Report – WSJ.

01/07/2014

A dramatic decline in suicides: Back from the edge | The Economist

IN THE 1990s China had one of the highest suicide rates in the world. Young rural women in particular were killing themselves at an alarming rate. In recent years, however, China’s suicides have declined to among the lowest rates in the world.

In 2002 the Lancet, a British medical journal, said there were 23.2 suicides per 100,000 people annually from 1995 to 1999. This year a report by a group of researchers from the University of Hong Kong found that had declined to an average annual rate of 9.8 per 100,000 for the years 2009-11, a 58% drop.

Paul Yip, director of the Centre for Suicide Research and Prevention at the University of Hong Kong and a co-author of the recent study, says no country has ever achieved such a rapid decline in suicides. And yet, experts say, China has done it without a significant improvement in mental-health services—and without any national publicity effort to lower suicides.

The most dramatic shift has been in the figures for rural women under 35. Their suicide rate appears to have dropped by as much as 90%. The Lancet study in 2002 estimated 37.8 per 100,000 of this age group committed suicide annually in 1995-99. The new study says this declined to just over three per 100,000 in 2011. Another study of suicides, covering 20 years in one province, Shandong, found a decline of 95% among rural women under 35, to 2.6 suicides per 100,000 in 2010—and a 68% drop in suicides among all rural women.

Scholars suspect that the number of suicides is underreported in official figures (the official suicide rate nationally was 6.9 per 100,000 in 2012) and they make adjustments for that in their calculations. But in several studies, as well as in official data, the long-term decline in suicides has been marked across the spectrum, in rural and urban areas and among men and women from almost all age groups. The only notable exception is the suicide rate among the elderly, which declined overall but has crept back up in recent years, a worrying trend in a rapidly ageing society.

Two intertwined social forces are driving the reduction: migration and the rise of an urban middle class. Moving to the cities to work, even if to be treated as second-class citizens when they get there, has been the salvation of many rural young women, liberating them from parental pressures, bad marriages, overbearing mothers-in-law and other stresses of poor, rural life. Migrants have also distanced themselves from the easiest form of rural suicide, swallowing pesticides, the chosen method in nearly 60% of rural cases, and often done impulsively. The reduction in toxicity of pesticides has helped as well.

Jing Jun, a sociologist at Tsinghua University in Beijing, notes that the increase in migration to the cities fits with the decline in rural suicides (see chart). Since rural dwellers accounted for most suicides, so the national rate has fallen, too. In 20 years, as the population went from mostly rural to more than half urban, the official national suicide rate dropped by 63%.

Suicides among urban residents are also dropping, suggesting other causes, too. Chinese newspapers frequently carry dramatic photos of suicidal people being rescued from window ledges and rooftops (like the woman in our picture). But the University of Hong Kong researchers found that urban suicides had dropped to 5.3 per 100,000 between 2002 and 2011, a fall of 59%. The simplest explanation is that, in spite of concerns about pollution, food safety and property prices, living standards and general satisfaction with urban life have gone up. Mr Jing also believes that, as in the countryside, the atomisation of extended families has reduced the family conflicts that can lead to suicides.

via A dramatic decline in suicides: Back from the edge | The Economist.

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