Archive for ‘Affluence’

05/09/2012

* Guangzhou Moves to Limit New Cars

NY Times: “It is as startling as if Detroit or Los Angeles restricted car ownership.

The municipal government of Guangzhou, a sprawling metropolis that is one of China’s biggest auto manufacturing centers, introduced license plate auctions and lotteries last week that will roughly halve the number of new cars on the streets.

The crackdown by China’s third-largest city is the most restrictive in a series of moves by big Chinese cities that are putting quality-of-life issues ahead of short-term economic growth, something the central government has struggled to do on a national scale.

The measures have the potential to help clean up China’s notoriously dirty air and water, reduce long-term health care costs and improve the long-term quality of Chinese growth. But they are also imposing short-term costs, economists say, at a time when policy makers in Beijing and around the world are already concerned about a sharp economic slowdown in China.

“Of course from the government’s point of view, we give up some growth, but to achieve better health for all citizens, it is definitely worth it,” said Chen Haotian, the vice director of Guangzhou’s top planning agency.

Nanjing and Hangzhou in east-central China are moving to require cleaner gas and diesel. Cities near the coast, from Dongguan and Shenzhen in southeastern China to Wuxi and Suzhou in the middle and Beijing in the north, are pushing out polluting factories. And Xi’an and Urumqi in northwestern China are banning and scrapping cars built before 2005, when automotive emissions rules were less stringent.

“There’s a recognition finally that growth at all costs is not sustainable,” said Ben Simpfendorfer, the managing director of Silk Road Associates, a Hong Kong consulting firm.

Facing public pressure to address traffic jams and pollution, municipal governments from across China have been sending delegations to Guangzhou. But the national government in Beijing is pushing back against further car restrictions because of worries about the huge auto industry, said An Feng, a senior adviser in Beijing to transportation policy makers.

“This has really become a battle,” Mr. An said.”

via Guangzhou Moves to Limit New Cars – NYTimes.com.

See also: 

27/08/2012

* Car plate applicants exceed 1m in Beijing

China Daily: “A record 1-million-plus people in Beijing competed for fewer than 20,000 registration certificates qualifying them to buy cars through a lottery system on Sunday.

With a fixed number of car registrations issued each month and a lengthening waiting list, many potential car buyers are losing hope.

Some 1.05 million qualified applicants entered the registration lottery in August – 110,000 of them for the first time – and only 19,926 registrations will be issued, the city office in charge of the lottery system said on Saturday.

One in every 53 applicants will get the registrations, 80 percent fewer than in January last year, when Beijing introduced the lottery system to cap new car ownership at 240,000 a year.”

via Car plate applicants exceed 1m in Beijing |Society |chinadaily.com.cn.

07/08/2012

* DreamWorks Plans Studio in Shanghai

WSJ: “DreamWorks Animation SKG Inc. on Tuesday signed plans with Chinese partners to build a $350 million movie studio in Shanghai to capitalize on the success of its Kung Fu Panda film franchise as the studio looks to build up its presence in a fast-growing Chinese movie market.

The studio will be 45% owned by the California animation company, with the remainder held by media-related companies controlled by the Shanghai government. The partners also plan an entertainment zone that could bring the total investment to 20 billion yuan (US$3.14 billion) to be largely funded in China.

The foundation of the project is the animation studio, DreamWorks CEO Jeffrey Katzenberg said in an interview. “The talent must exist here in China if only they had the knowledge, training and opportunity,” he said.

The partners said the film “Kung Fu Panda 3″ will be co-produced in Shanghai for a 2015 or 2016 release. The Shanghai studio plans its first film by 2017 and would build toward one to three major films a year, with an aim to build an animation base in China that can produce films for a world-wide market.

The joint venture said on Tuesday that it plans to build a tourism and entertainment complex that it calls the Dream Center with an opening date of 2016 in Shanghai’s Xuhui district. The facility near an abandoned airport will include tourist attractions, restaurants and commercial space, the joint venture said. Mr. Katzenberg said his company will help design that aspect of the business but be a small minority partner in the park, which represents the largest share of the investment plans.

The moves—which were announced in part earlier this year—come as rival Walt Disney Co. also looks to build up its presence in Shanghai. The U.S. entertainment company last year began construction of its own $4.4 billion theme park with Shanghai-government partners that will also include hotels, restaurants and other amenities.

Western entertainment companies are looking for ways to tap the fast-growing Chinese entertainment market. China’s box-office revenue surged 42% in the first half of the year to $1.28 billion as increasingly affluent consumers head to the movies. But the domestic industry is still underdeveloped, with foreign productions dominating the business. Mr. Katzenberg said American movies have represented 70% of the Chinese box office so far this year.”

via DreamWorks Plans Studio in Shanghai – WSJ.com.

20/07/2012

* Rural Chinese get online as mobile overtakes desktop

BBC News: “Mobile phones are now the most common way for people to connect to the internet in China, a report has said.

For the first time, desktop computers are no longer the leading method for the country’s 538 million connected citizens to get online.

The report from the China Internet Network Information Center (CINIC) said over 50% of the year’s new internet users were from rural areas.

A fall in smartphone costs has been the key cause of growth, experts said. “Mobile phones are a cheaper and more convenient way to access the internet for [residents in] China’s vast rural areas and for the enormous migrant population,” said the report from the state-linked CINIC.

Mobile internet users now number 388 million, up almost 10% since the start of the year. “Mobile phone prices continued to drop,” the report said.

“The emergence of smartphones under 1,000 yuan [$157, £100] sharply lowered the threshold for using the devices and encouraged average mobile phone users to become mobile web surfers.”

The total number of those online has risen 5% since the end of last year, many of whom are very active in cyberspace.”

via BBC News – Rural Chinese get online as mobile overtakes desktop.

See also: https://chindia-alert.org/economic-factors/information-technology/

19/07/2012

* In China, wait leads to standoff with officials

San Jose Mercury News: “The Chinese sometimes display a remarkable tolerance for those who cut in line but such forbearance apparently has its limits when queue-jumpers are government officials.

Thousands of people threw water bottles and blocked traffic at a popular nature preserve in northeastern China on Sunday after word spread that the arrival of top Communist Party leaders was causing an hours-long wait to visit a scenic lake. It was one of a string of brash confrontations in recent months between the authorities and Chinese citizens.

The infuriated crowd surrounded the vehicles carrying the government entourage and refused to let them pass, according to scores of microblog posts sent out by those waiting to ascend Changbai Mountain in Jilin Province. The three-hour standoff drew police officers and soldiers, some of whom reportedly beat recalcitrant protesters.

According to one witness, thousands of people chanted for a refund of the $20 entry tickets and later demanded that the officials leave their besieged vehicles and apologize. “Fight privilege!” the witness wrote.

The accounts, posted on Sina Weibo, a Twitter-like service, were later deleted by the company’s in-house censors but many postings were saved and reposted on overseas websites like Ministry of Tofu and China Digital Times whose servers cannot be reached by Chinese censors.”

via In China, wait leads to standoff with officials – San Jose Mercury News.

See also:

14/07/2012

* Wuhan airport to build new terminal

China Daily: “A new terminal will be built in the Wuhan Tianhe International Airport before 2015 to meet increasing passenger demand in Central China’s Hubei province, local media reported on Friday.

The project will cost about 16 billion yuan ($2.5 billion), and will occupy an area of 370,000 square meters with a 3,600-meter long and 60-meter wide runway, the Chutian Metropolis Daily reported.

The new runway can guarantee the safe takeoff and landing of the Airbus A380, the report said.

The project, already approved by the National Development and Reform Commission, will start construction before October. The terminal will be built in a flying-phoenix shape, representing local culture.

A parking apron with capacity for 60 planes will also be built, the report said.

According to airport data, more than 12 million domestic and foreign passengers arrived at, or left from, the airport last year, only 1 million less than the airport’s capacity of 13 million.

The airport is expected to receive about 14 million passengers this year.”

via Wuhan airport to build new terminal |Society |chinadaily.com.cn.

The current Wuhan airport was only opened in 1995, and a new one is planned for2015 – looking to the future.

London Heathrow was built in 1929 and expanded to its modern configuration after WW2. It is limited by its two main runways. Yet, after years of debate, neither has a decision been made to build a third runway nor has an alternative solution been discussed seriously – there being so many contenders ranging from expanding Gatwick or another nearby airport or even expanding provincial airports like Manchester or Birnmingham; plus a proposed contentious new airport in the Thames Estuary favoured by London Mayor Boris Johnson. Case of looking to the past?

See also: https://chindia-alert.org/economic-factors/chinas-infrastructure/

11/07/2012

* Socialist market economy turning point for China

Xinhua: “Good education, housing, medical care and insurance are within the reach of more Chinese since the adoption of a market economy, according to a Tuesday commentary in the People’s Daily, the flagship newspaper of the Communist Party of China (CPC).

The formation and improvement of China’s socialist market economy has reshaped the lives of 1.3 billion people and exerted an influence on the future of the whole world, wrote Ren Zhongping.

In the past 20 years, the most populous nation has become the world’s second-largest economy and has stood among middle-income countries in terms of its per capita gross domestic product, Ren said.

China turned itself from a seller’s market to a buyer’s market and became the world’s biggest exporter and a member of the World Trade Organization, Ren said.

At the beginning, China’s transformation faced many obstacles, including domestic prejudice and doubts of foreign countries, Ren said.

However, the “China miracle” surprised everyone, Ren wrote.

“It is said that everything happened in the past 20 years could not be planned in any plan,” Ren said.

Focusing on developing productivity, adhering to the common development of public-owned and private economies and integrating market allocation with the government regulation helped make China successful, Ren said.

However, the problems that have emerged after development are no smaller than those that existed before China’s prosperity, Ren said.

It’s imperative to enhance the quality of economic development, eliminate factors that hamper economic growth mode and smash the administrative monopoly so as to further free development of the private economy, Ren said.

The author called for a sound insurance system that can relieve social anxiety and narrow the income gap, as well as stark government reforms.

Unswerving reform is the only way to realize the goal of “establishing a sound social market economic system by 2020,” Ren said.

Changing China’s economic growth mode, promoting transformation of government functions and boosting equality in public services will allow China to shoulder a sea of challenges both now and in the future, Ren wrote.”

via Socialist market economy turning point for China: People’s Daily – Xinhua | English.news.cn.

A fair summary of the past 20 years and a good prognostication of the next twenty.

Related articles

24/06/2012

* Ikea Applies for Big Indian Investment

WSJ: “Swedish housewares giant IKEA Group asked India for permission to invest €1.5 billion ($1.9 billion) in the country to set up 25 retail stores in coming years, a commitment that provides some relief for New Delhi policy makers who have been trying to boost sagging foreign-investor sentiment.

IKEA’s foray into India, made possible by a policy change last year that allowed some retailers to own 100% of their Indian units, could help transform India’s largely unorganized, $500 billion retail sector. But the company will face significant challenges, including meeting the government’s mandate that it source 30% of inventory from local small-scale industries.

IKEA, which has 290 stores in 26 countries and is known for selling affordable, modern-looking furniture and housewares, said that if the Indian government approves its application it could have a significant effect on the country’s retail sector, “vastly improving availability of high-quality, low-price products not available in India.”

The company announced its decision after its chief executive, Mikael Ohlsson, met with Indian Commerce Minister Anand Sharma on Friday at a conference in St. Petersburg, Russia.”

via Ikea Applies for Big Indian Investment – WSJ.com.

See also: Consumerism grows in India

21/06/2012

* Imagine if every resident of Mumbai had a car?

IT Decisions: “Professor Stéphane Garelli of IMD Business School and the University of Lausanne delivered one of the opening keynotes, describing the future of the world economy. One of the key points he made related to consumers in emerging economies creating ‘needs’ from what were previously ‘wants’.

“In China, everybody is buying a fridge. How many times have you bought a fridge? Once you have one then it lasts a long time before you replace it. You are living in a replacement economy where you are just upgrading what you already have. In China, you have no fridge, you want one. You have no TV set, you want one. You have no telephone, you want one…” he said.

The idea that enormous tranches of humanity are about to start consuming items they have never used before, such as cars, washing machines, fridges, and air conditioning, is a scary thought for environmental campaigners. Economic growth benefits those who are lifted from poverty, but how can the world really cope with billions of new drivers all expecting their own car?

Professor Garelli said: “The problem for the environment is that the infrastructure is not following [consumption].  For example in China, in 2020 they will buy 30m cars and only 15m will be sold in the USA. So everybody wants a car, but there are not enough roads for all of them. You need growth, you need traffic control, etc – the infrastructure has to grow in parallel.”

Professor Garelli went on to explain: “This means there is an enormous environmental impact and I think that this growth has to be checked. At a certain stage they will have to slow down some access. There are some countries where people can perhaps wait for a car – can you imagine if every single person in Mumbai has a car?”  …  “

via Imagine if every resident of Mumbai had a car? | IT Decisions.

10/06/2012

* China Passenger-Car Sales Pick Up

WSJ: “Passenger-car sales in China accelerated in May, a positive sign for the world’s second-largest economy and the largest auto market. Strong auto sales in China, a signal consumers are still buying big-ticket items, could reassure markets concerned that the country is heading for a sharp economic slowdown.

Sales in May were up 23% from a year earlier, to 1.28 million vehicles, the semiofficial industry group China Association of Automobile Manufacturers said in a statement Saturday. That’s faster than Aprils 13% pace—which was itself an encouraging turnaround from the decline in the first quarter, when sales were down 1.3% from a year earlier.”

via China Passenger-Car Sales Pick Up – WSJ.com.

One small positive indicator amongst lots of negatives.  See: https://chindia-alert.org/2012/06/10/chinese-economy-shows-a-second-month-of-anemic-growth/

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