21/04/2020
- Israeli medical equipment firm IceCure Medical, with an initial US$4 million sales and marketing effort, will open its first Chinese office in Shanghai
- English shopping outlet company Value Retail sees the chance to lure consumers who have been under lockdowns aimed at halting the spread of the coronavirus
Foreign firms, including Israeli medical equipment maker IceCure Medical and English shopping outlet company Value Retail, still see opportunities in China despite the coronavirus. Photo: AFP
Not only has the coronavirus pandemic not watered down one company’s expansion plans for China, it has given it even greater reason to push forward into the Chinese market.
Israeli company IceCure Medical is forging ahead with opening its first Chinese office in Shanghai, with plans to spend up to US$4 million for the initial sales and marketing effort for its non-surgical breast cancer treatments.
Chief executive Eyal Shamir said he has seen an uptick in Chinese interest in the company’s ProSense product, which allows the freezing of tumours outside a hospital environment, because it can free up facilities badly needed for Covid-19 patients.
The government approval of the company’s Chinese subsidiary is now only days away following a successful product console registration, according to Shamir, and it has already sold two units to the Fudan University Shanghai Cancer Centre for a clinical study.
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“We are planning a full launch of the product in China for both breast cancer and breast benign tumours as well as other organs,” Shamir said.
“Post Covid-19, there will be a backlog of many surgeries and not only for breast cancer patients.”
IceCure Medical, though, is not the only foreign company eyeing expansion into China despite the risk of secondary outbreaks of coronavirus.
West of Shanghai, English shopping outlet company Value Retail is also expanding its retail space, banking on Chinese shoppers re-emerging from lockdowns to begin
After being cooped at home for weeks, people want to be outdoors to enjoy the beautiful spring weather – Value Retail
Value Retail is proceeding with plans to enlarge its Suzhou Village shopping centre from 35,000 square metres (378,000 sq ft) to over 50,000 square metres, while also increasing the number of shops from 120 to 200, which will make it the largest of the 11 venues its controls globally.
It is working closely with the Yang Cheng Lake Peninsula government on a date for construction to start, after seeing a surprising increase in retail sales at its centres in early April. The company’s Chinese subsidiary, Value Retail China, attributed the rise to an increasing number of consumers wanting to “get outside” of their homes after being isolated for several weeks.
Suzhou Village sales have increased 40 per cent each week since the start of April, the company said.
“Thanks to the positive recovery [in spending] over the past several weeks, we are going ahead with the Suzhou Village expansion,” the company said in a statement. “After being cooped at home for weeks, people want to be outdoors to enjoy the beautiful spring weather. We provide a shopping experience for guests in an outdoor environment … the motivation for such an experience after isolation is huge. [Being] outdoors is seen as a luxury now.”
In addition, customers are flocking to both its Suzhou and Shanghai Village centres as a form of domestic tourism because of the curb on overseas travel, Value Retail China said.
Despite the economic destruction that the
coronavirus pandemic has caused in China, it also is opening up expansion opportunities for entrepreneurial firms in several industries, such as e-commerce and online delivery, life sciences and infrastructure construction, said EY Asia-Pacific transaction advisory services leader Harsha Basnayake.
However, while businesses within Asia-Pacific expressed a desire for opportunistic expansions, most companies still held a pessimistic view of economic recovery that would drag on into 2021.
American companies already operating in China were even less optimistic with over 70 per cent of businesses surveyed by the American Chamber of Commerce in March saying they were reluctant about expanding in the coming year.
Although it is too early to say if retail property will rise – particularly when we are seeing new habits forming, going from shopfronts to online and how far this new behaviour will stick. China will gives us lots of lessons on this. – Harsha Basnayake
“We are expecting opportunities in real estate, particularly in commercial property and logistics, and we think industries in life sciences, some parts of health care and infrastructure will be interesting,” Basnayake said.
“Although it is too early to say if retail property will rise – particularly when we are seeing new habits forming, going from shopfronts to online and how far this new behaviour will stick. China will gives us lots of lessons on this.”
The Chinese government’s move to increase infrastructure spending to boost the economy will also benefit certain industries, such as cement production.
Despite suffering a 24 per cent drop in sales in the first quarter due to virus-related delays in construction activities, China’s largest cement manufacturer, Anhui Conch Cement, is likely to move forward with plans to expand in part due to its participation in the Belt and Road Initiative, according to analysts at S&P Global.
Though no one would be able to tell exactly what will happen when the Covid-19 uncertainties are not completely gone, signs of recovery in China have brought encouragement to us – Justin Channe
Desires to expand are also not limited to these industries, and even the hard-hit hotel industry is starting to show green shoots.
International hotel chain IHG said that the coronavirus would not derail its new Regent-branded hotel project in Chengdu, which is expected to start construction later this year.
“Though no one would be able to tell exactly what will happen when the Covid-19 uncertainties are not completely gone, signs of recovery in China have brought encouragement to us,” said Regent Hotels & Resorts managing director Justin Channe.
“While we saw business pickup across China over the past Qing Ming Festival holiday, Chengdu and its nearby destinations were among the leading ones. In the long run, we stay confident of the outlook for the China hotel industry, including the luxury segment.”
Analysing how coronavirus broke China’s historic economic growth run
Beyond the crisis, there will be ample opportunities for new merger and acquisitions (M&A) amid business restructures and failures, particularly in China, Basnayake added.
A new EY survey found 52 per cent of Asia-Pacific businesses planned on pursuing M&A in the next year.
“While the crisis is having a severe impact on M&A sentiment, there’s evidence from the survey that M&A activity intentions remain steady in the long term. There are many who recognise this is a time where valuations will be reset, and there will be stressed and distressed acquisition opportunities,” Basnayake said.
“For example, from our interviews with corporations in China, a majority said that Covid-19 has not impacted their M&A strategies, noting that the situation has not led to any cancellations or withdrawals from deals, but only in delays in closing deals.”
Source: SCMP
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02/04/2020
- 36-hour exercise simulates countering enemy planes during wartime, report says
- People’s Liberation Army placing increasing emphasis on airborne early-warning and control aircraft, observers say
The Eastern Theatre Command’s latest exercise follows joint air and naval drills near Taiwan in February. Photo: Handout
The Chinese military command responsible for patrols around
Taiwan stepped up its drills by staging a long-endurance early-warning exercise in March, the official
PLA Daily reported on Wednesday.
A warplane conducted tactical acrobatics, which were not specified, immediately after taking off, the report said. The move had not been common during previous drills, and was intended to simulate quickly countering enemy planes during wartime, the report quoted the plane’s captain Liu Yin as saying.
The plane performed reconnaissance, early-warning and surveillance work, tested airborne strikes, and an unspecified number of fighter jets in two groups staged a confrontation in a combat scenario.
The drill lasted for about 36 hours, the report said.
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Zi Kun, an officer from the division’s training unit, said the drill was a test for both pilots and equipment because it involved planning and coordination to meet actual combat requirements.
The exercise came after the Eastern Theatre Command in early February launched joint drills featuring naval and air forces near Taiwan and a combat-readiness drill in which its warplanes encircled the self-ruled island.
It also came after the United States sent EP-3E Aries electronic warfare and reconnaissance aircraft to fly near Kaohsiung, in southern Taiwan, and Hong Kong in late March.
Beijing may step up drills in South China Sea amid US military tensions
Beijing views the self-governed Taiwan as a renegade province that must be united with mainland China by force if necessary.
Experts said the drill was designed to enhance China’s intelligence-gathering capabilities to better monitor activities at sea and in the air.
Taiwan’s re-elected president Tsai Ing-wen meets US and Japanese envoys to call for closer ties
“The People’s Liberation Army’s Air Force used to rely only on ground-based early-warning radar. Only in the past two decades, it started to acquire airborne early-warning and control aircraft, which could allow the air force to extend their radar coverage beyond the limits of ground-based radars,” said Collin Koh, a research fellow from the S Rajaratnam School of International Studies at Singapore’s Nanyang Technological University.
“The problem with ground-based radars is they are often limited by line of sight and Earth curvature, whereas the airborne early-warning assets can help to address these radar gaps and also have a better ability to pick up low-flying targets and those obscured by terrain,” Koh said.
Taiwan military stages exercise to fight off mock invasion
Zhou Chenming, a Beijing-based military expert, said that China did not have enough early-warning planes to support its expanding military ambitions and needed to maximise its capabilities through various exercises to act as a credible deterrent.
The command’s ongoing drills in recent months would be intended to send signals to the outside world on two fronts, according to Koh.
“The Eastern Theatre Command’s primary area of responsibility would cover Taiwan. And by extension, it also means targeting US forces concentrated not just in the nearby bases in Japan but also further afield beyond the First Island Chain, especially Guam,” he said.
Source: SCMP
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