Posts tagged ‘United States’

19/10/2014

China, Vietnam pledge to ‘address and control’ maritime disputes | Reuters

China and Vietnam have agreed to “address and control” maritime disputes, state media said on Friday, as differences over the potentially energy-rich South China Sea have roiled relations between the two countries and other neighbors.

Chinese coastguard ships give chase to Vietnamese coastguard vessels (not pictured) after they came within 10 nautical miles of the Haiyang Shiyou 981, known in Vietnam as HD-981, oil rig in the South China Sea July 15, 2014. REUTERS/Martin Petty

Ties between the Communist countries sank to a three-decade low this year after China deployed a $1 billion-oil rig to the disputed waters which straddle key shipping lanes.

Vietnam claims the portion of the sea as its exclusive economic zone, and the rig’s deployment sparked a wave of violent protests in Vietnam.

The two countries should “properly address and control maritime differences” to create favorable conditions for bilateral cooperation, Chinese Premier Li Keqiang told Vietnamese Prime Minister Nguyen Tan Dung on Thursday on the sidelines of the Asia-Europe Meeting (ASEM) in Milan.

“Thanks to efforts from both sides, China-Vietnam relations have ridden out the recent rough patch and gradually recovered,” the official Xinhua news agency cited Li as saying.

Xinhua said Dung agreed and endorsed boosting “cooperation in infrastructure, finance and maritime exploration”.

The comments were a reiteration of earlier pledges by leaders from the two countries.

China’s Defense Minister Chang Wanquan held talks with his Vietnamese counterpart, Phung Quang Thanh, on Friday in Beijing, Xinhua reported, during which both sides agreed to “gradually resume” military ties.

The two leaders vowed that the countries’ militaries would “play a positive role in properly dealing with their maritime disputes and safeguarding a peaceful and stable situation”, the news agency said.

China claims almost the entire South China Sea, believed to be rich in deposits of oil and gas resources. Brunei, Malaysia, the Philippines, Taiwan and Vietnam also have claims in the waters where $5 trillion of ship-borne goods pass every year.

Alarmed by China’s military rise and growing assertiveness, Vietnam has broadened its military relationships in recent years, most notably with Cold War-era patron Russia but also with the United States.

Beijing has told Washington to stay out of disputes over the South China Sea and let countries in the region resolve the issue themselves.

via China, Vietnam pledge to ‘address and control’ maritime disputes | Reuters.

19/10/2014

A pocket guide to doing business in China | McKinsey & Company

A pocket guide to doing business in China

McKinsey director Gordon Orr goes behind the trends shaping the world’s second-largest economy to explain what companies must do to operate effectively.

October 2014 | byGordon Orr

China, a $10 trillion economy growing at 7 percent annually, is a never-before-seen force reshaping our global economy. Over the past 30 years, the Chinese government has at times opened the door wide for foreign companies to participate in its domestic economic growth. At other times, it has kept the door firmly closed. While some global leaders, such as automotive original-equipment manufacturers, have turned China into their single largest source of profits, others, especially in the service sectors, have been challenged to capture a meaningful share of revenue or profits.

This article summarizes some of the trends shaping the next phase of China’s economic growth, which industries might benefit the most, and what could potentially go wrong. It also lays out what I believe it takes to build a successful, large-scale, and profitable business in China today as a foreign company.

via A pocket guide to doing business in China | McKinsey & Company.

17/09/2014

Survey shows 10 problems of Chinese society – China – Chinadaily.com.cn

Twenty-four percent has cited the credibility deficit of the government as a main reason behind the lack of trust in Chinese society, according to a survey conducted by People’s Tribune, a magazine of People’s Daily.

Survey shows 10 problems of Chinese societyThe survey finds more than 80 percent of respondents think of Chinese society as “sub-healthy” and 40.4 percent  believe that a crisis of credibility is sickening society.

The “symptoms” are, in order, distrust in “whatever the government says”, “distrust between people’, “doubt over food and medicine safety” and distrust in “doctors’ professional ethics”.

A lack of faith is the most recognized problem in the survey. When asked to choose which group suffers the most from the symptom, more than half of the respondents chose government officials. In a report of the People’s tribute, the choice was referred to a recent case of the self-styled “qigong master” Wang Lin, who claimed to have supernatural powers. He has been put under the spotlight after his photos with many government officials and celebrities were published online last summer.

The superstition in officialdom mirrors corruption in the government, the report said. In terms of the reason behind the loss of faith, some 50 percent of netizens cited “unethical behaviors have gone unpunished”, while 20.8 percent blame the “mercenary” market economy.

Extreme, violent and anti-social behaviors have been chosen by nearly one third of the netizens as another major illness of society, with the “disadvantaged groups” as the most obvious example. “The growing social inequality and feeling of deprivation” have been cited as the main causes.

The full list of responses of the survey

1 Lack of faith

2 “Bystander attitude”or being indifferent

3 Anxiety over work, life and future

4 Habitual distrust

5 Ostentatiousness

6 Reveling in scandals

7 Hedonism

8 Extreme, violent and anti-social behaviors

9 Addiction to the Internet

10 Masochism, complaints about the Party and state system

via Survey shows 10 problems of Chinese society – China – Chinadaily.com.cn.

17/09/2014

Africa’s Ebola Should Be China’s Problem – Bloomberg View

China may be Africa‘s biggest trading partner and one of its biggest investors, but you wouldn’t know that from the size of its contribution toward fighting West Africa’s Ebola outbreak.

China: big on investing, not so much on humanitarianism. Photographer: Dominique Faget/AFP/Getty ImagesIn fact, the contrast between its assistance and that of the U.S. is instructive: Today, President Barack Obama announced that the U.S. would raise the total of U.S. personnel now in Africa dealing with Ebola to 3,000; the U.S. has committed more than $175 million in aid. With much fanfare, China has said it will increase the number of its medical personnel in Sierra Leone to 174 and raise its total amount of assistance to roughly $37 million.

I know, I know: Relative to the U.S., China remains a poor country, and its growing willingness to extend humanitarian assistance outside its borders is a good thing. But consider this: China has close to 20,000 citizens working and living in Guinea, Liberia and Sierra Leone. Setting aside U.S. money flowing into Liberia’s lucrative shipping registry, China’s investment in those three countries dwarfs that of the U.S. (In fact, China’s trading relationship with Africa overall is twice that of the U.S.) It recently signed deals for iron ore mining in the region that collectively run into the billions of dollars.

via Africa’s Ebola Should Be China’s Problem – Bloomberg View.

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.

12/09/2014

Soft power: Confucius says | The Economist

“HARMONY is the most valuable of all things,” said the Chinese philosopher Confucius two and a half millennia ago. There is little of it in evidence in the frosty relationship between the woman who was the founding director of the Confucius Institute at the University of Oregon, Bryna Goodman, and her fellow historian, Glenn May. Their offices are separated by a ten-second walk, but the scholars do not exchange visits. Their palpable ill feeling reflects growing discord among Western scholars about a decade-old push by China to open government-funded cultural centres in schools and universities abroad. Intended to boost China’s “soft power”, the centres take the name of the peace-espousing sage. They tap into growing global demand for Chinese-language teaching. But they are also fuelling anxiety about academic freedom.

In America the Confucius programme has been widely welcomed by universities and school districts, which often do not have enough money to provide Chinese-language teachers for all who need them. But critics like Mr May believe China’s funding comes at a price: that Confucius Institutes (as those established on university campuses are known) and school-based Confucius Classrooms restrain freedom of speech by steering discussion of China away from sensitive subjects.

In June the American Association of University Professors called for universities to end or revise their contracts with Confucius Institutes (America has 100 of them) because they “function as an arm of the Chinese state and are allowed to ignore academic freedom”. Mr May has been asking the University of Oregon to close its institute, to no avail. Ms Goodman (who is no longer the institute’s director) says that in funding its interests China is like any other donor to American universities. She says that the institutes have become lodestones of what she calls a “China fear”.

When China opened its first Confucius Institute in 2004 in Seoul, it hoped the new effort would prove as uncontroversial as cultural-outreach programmes sponsored by Western governments, such as the British Council, the Alliance Française and Germany’s Goethe-Institut. The idea was to counter fears of China’s rise by raising awareness of a culture that is often described by Chinese as steeped in traditions of peace.

Through the Hanban, a government entity, China provides the centres with paid-for instructors and sponsors cultural events at them. Its spending is considerable, and growing rapidly. In 2013 it was $278m, more than six times as much as in 2006. China’s funding for Confucius Institutes amounts to about $100,000-200,000 a year on many campuses, and sometimes more (Oregon received nearly $188,000 in the last academic year). By the end of 2013 China had established 440 institutes and 646 classrooms serving 850,000 registered students. They are scattered across more than 100 countries, with America hosting more than 40% of the combined total. There are plans for another 60 institutes and 350 classrooms to be opened worldwide by the end of 2015.

Chinese officials express satisfaction. In June Liu Yunshan, who is in charge of the Communist Party’s vast propaganda apparatus, said Confucius Institutes had “emerged at the right moment”. He described them as a “spiritual high-speed rail”, promoting friendship by connecting Chinese dreams with those of the rest of the world.

Others are less sanguine, however. In America criticism has recently grown stronger. Earlier this year more than 100 members of the faculty at the University of Chicago complained that Confucius Institutes were compromising academic integrity. In an article published in 2013 by Nation magazine, one of the university’s academics, Marshall Sahlins, listed cases in several countries involving what appeared to be deference to the political sensitivities of Confucius Institutes. These included a couple of occasions when universities had invited the Dalai Lama to speak and then either cancelled the invitation or received him off-campus.

In one case, at North Carolina State University in 2009, the provost said after the cancellation of a Dalai Lama visit that the Confucius Institute had indicated the exiled Tibetan’s presence could cause problems with China. This year Steven Levine, an honorary professor at the University of Montana, wrote to hundreds of Confucius Institutes around the world asking them to mark the 25th anniversary in June of the violent suppression of the Tiananmen Square protests. None of them agreed. Global Times, a Beijing newspaper, recently called the protests of foreign academics “a continuation of McCarthyism”.

Ms Goodman argues that the study of China needs all the funding it can get, even if that means taking money from countries with vital interests at stake—whether China, Taiwan, or the United States. She says that if China were ever to meddle politically in Oregon’s institute, the Confucius programme would be quickly shut down.

Such assurances do not address a big concern of critics—that the political influence of Confucius programmes is often subtle and slow-acting. If the critics are right, it is very subtle indeed. Surveys suggest that in many countries China’s image has not markedly improved over the past decade. The Pew Research Centre, an American polling organisation, says 42% of Americans viewed China favourably in 2007. Last year only 37% did. The political dividends of China’s soft-power spending are far from obvious.

via Soft power: Confucius says | The Economist.

05/09/2014

Australia to sign uranium export deal with India – Businessweek

Australia’s Prime Minister Tony Abbott met with his Indian counterpart Friday on a two-day state visit during which they are expected to sign a deal to allow the export of Australian uranium to India for use in power generation.

The agreement is expected to be signed Friday evening. Australia, which has almost a third of the world’s known uranium reserves, imposes strict conditions on uranium exports and India’s failure to sign the Nuclear Non-proliferation Treaty had long been a barrier to a trade deal.

Australia and India have been negotiating a nuclear safeguards agreement with verification mechanisms since 2012, when a former Australian government agreed on civil nuclear energy cooperation with India that would eventually allow the export of Australian uranium to the energy-starved South Asian nation.

India faces chronic shortages of electricity and about 65 percent of its installed power generation capacity comes from burning fossil fuels including oil, coal and natural gas. India is eager to expand its nuclear power capacity.

Australia’s decision to sell uranium to India follows a civil nuclear agreement with the United States. The deal with the U.S. was signed in 2008 and allowed Washington to sell nuclear fuel and technology to India without it giving up its military nuclear program.

India is seeking a similar agreement with Japan. The two sides have claimed “significant progress” but failed to reach a last-minute agreement on safeguards sought by Tokyo when the Indian Prime Minister Narendra Modi was in Japan earlier this month.

via Australia to sign uranium export deal with India – Businessweek.

05/09/2014

The U.S. Trade Deficit Shrinks—Except With China – Businessweek

The good news? The overall U.S. trade deficit unexpectedly shrank a bit less than 1 percent in July from June. It was the smallest gap in half a year, and exports broke a record. The bad news? The U.S. deficit in manufacturing set a monthly record, and the deficit in goods traded with China also broke a record.

China Shipping Container Lines containers sit stacked at the Port of Los Angeles in San Pedro, California on April 8

Alan Tonelson, a trade analyst who blogs at RealityChek, dwelt on the negative in an interview today. “There’s no doubt that major barriers to U.S. exports remain,” he said. “China is case in point No. 1. It’s still one of the most protectionist economies in the world.”

Boston Consulting Group has argued in a series of reports that the U.S. has a bright future in manufacturing because the high productivity of American workers makes it an affordable location for production, while China is slowly pricing itself out of the market through rising labor costs. It calls the U.S. a “rising global star.”

But that stardom isn’t showing up yet in the trade data. Says Tonelson of Boston Consulting’s view: “If they’re just premature, they seem wildly premature.”

As reported by the Bureau of Economic Analysis, the overall U.S. trade deficit in both goods and services was $40.5 billion in July—down from June, but up $1.1 billion from a year earlier. The July deficit with China in goods was $30.9 billion, vs. a previous high of $30.6 billion. The overall manufacturing deficit, at $67 billion in July, is running 11 percent ahead of last year’s record pace, Tonelson calculates.

via The U.S. Trade Deficit Shrinks—Except With China – Businessweek.

05/09/2014

U.S. South Draws Global Manufacturers With Low Taxes, Cheap Labor – Businessweek

Just before the recession hit in 2007, Electrolux (ELUXA:SS), the Swedish home-appliance maker, was trying to decide what to do about an aging plant outside Montreal. The building was more than 100 years old and the line of high-end stoves and ovens produced there needed a refresh. The factory’s 1,300 union workers earned around $20 an hour.

Rather than sink more money into the old plant, Electrolux decided to move where it could operate more cheaply. In Europe, it was shifting work from Sweden, England, and Denmark, to Hungary, Poland, and Thailand, where workers are paid less. In North America, Electrolux settled on another low-cost region: the American South.

Alabama, North Carolina, and Tennessee—along with Mexico—all competed for the plant, offering generous incentive packages. The winner was Tennessee, which together with the city of Memphis and Shelby County, assembled an offer that, according to Electrolux, was worth $182 million, including public infrastructure funds, tax breaks, and, crucially, worker training. The company committed $100 million to build the plant. In December 2010, Electrolux announced that a site just eight miles from Graceland would be home to its most advanced factory. “We don’t just grab at every project that comes through here,” says Memphis Mayor A C Wharton Jr. “But this one was particularly appealing.”

Manufacturing is slowly returning to the U.S.—and much of the action has been below the Mason-Dixon line. With its low tax rates and rules that discourage unionization, the South has for decades been seen as business-friendly, which helped the region attract service companies that rely on low-skilled workers, such as call centers and warehouses. Now industries such as autos and aerospace are moving in. According to Southern Business & Development (SB&D) magazine, which tracks commercial projects valued at more than $30 million, manufacturing made up 68 percent of investments announced last year. The number of projects totaled 410, the most in 20 years.

Changing conditions in the oil market and China have a lot to do with manufacturing’s resurgence in the South. In 2001, when China joined the World Trade Organization, the price of oil was $20 a barrel and the hourly manufacturing wage in China’s Yangtze River Delta was 82¢ an hour. Oil is now more than $100 a barrel and workers in the Yangtze make $4.93 an hour. The once enormous manufacturing advantage of the People’s Republic has in some cases vanished.

An April 2014 study by Boston Consulting Group found that the U.S. now ranks second only to China in manufacturing competitiveness among the top 10 exporting countries. Three years ago, BCG Managing Director Harold Sirkin, co-author of the report, forecast that states such as South Carolina, Alabama, and Tennessee would become “among the least expensive production sites in the industrialized world.” That’s especially true for companies making things for sale in the U.S. The South “has become the cheapest place to make things inside the largest economy in the world,” says Michael Randle, publisher of SB&D.

via U.S. South Draws Global Manufacturers With Low Taxes, Cheap Labor – Businessweek.

04/09/2014

Businessman caught in Colombia is China’s first economic fugitive extradited from Latin America | South China Morning Post

A businessman from Zhejiang province, who was arrested in Colombia over allegations he fled the mainland after leaving debts totalling millions of yuan, was repatriated to China yesterday.

a-yiwu.jpg

The case is the first time the mainland has extradited an economic fugitive from a Latin American country, China News Service reported.

The 35-year-old suspect, whose surname was given as Wu, was arrested in Colombia on August 28, it said.

He owned a trading company in Yiwu city and reportedly fled China on a flight from Shanghai‘s Pudong International Airport on September 9, 2012.

He had allegedly left unpaid debts totalling more than four million yuan (more than HK$5 million).

Zhejiang police launched an investigation into Wu about a month later, and order for his arrest was issued in December 2012.

After cooperating with Interpol, Zhejiang police discovered in July that Wu was in Colombia, said Ding Pinglian, of the Zhejiang provincial police bureau.

Four police officers were then sent to Colombia to assist with Wu’s arrest and extradition.

Wu is expected to stand trial in Yiwu, China News Service reported.

A total of 11 people suspected of economic crime have been repatriated since the Ministry of Public Security launched a campaign to return fugitives in July, the report said.

The ministry said last month that more than 150 mainlanders suspected of economic crimes were in the United States, which had become the “top destination” for Chinese fugitives.

via Businessman caught in Colombia is China’s first economic fugitive extradited from Latin America | South China Morning Post.

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