Posts tagged ‘China’

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26/01/2014

The party is over for SOEs conferences – Chinadaily.com.cn

\”Best employee\” got a Porsche. The \”excellent\” few scooped 500,000-yuan stocks and trips to Hong Kong. \”Good\” employees won cool gadgets like NOTE2 and IPhone 5s.

The party is over for SOEs conferences

Generosity indeed at the year-end dinner of Qihoo 360, an NYSE-listed Chinese Internet company, which wowed netizens and left many public sector employees somewhat slightly envious.

A female employee with a private petroleum company in Yantai, Shandong province poses after winning a car as a year-end bonus on Jan 15, 2014. The affluent company gives away 52 cars worth 6.5 million yuan ($1.07 million) to employees with outstanding performance in the last year. [icpress.cn]

Traditionally, Chinese companies host \”annual conferences\” in the last lunar month of the year to celebrate their success by thanking staff and clients.

In previous years, the most lavish of such extravaganza were often the headline grabbing spectacles staged by China\’s mammoth state-owned enterprises (SOEs) featuring sumptuous banquets in five-star hotels, swanky gifts and wall-to-wall celebrities. This year, it was private firms which stole the show, while the otherwise high-profile SOEs had little to celebrate.

LET THE GOOD TIMES ROLL

Employees of a number of big SOEs in Beijing have told Xinhua that \”annual conferences\” would either not be held at all, or would be receptions made \”as simple as possible\”.

The gifts for staff and clients have morphed from MacBooks, IPads and IPhones to chocolates, towels and even toothpaste, they said.

Tian, who works in a state-owned Beijing bank, told Xinhua that his bank won\’t be hosting any annual conference at all this year, for the first time in many years.

He recounted the good old days when the winner of the prize draw at the annual conference received a 60-gram gold bar and he, together with hundreds of colleagues, won a MacBook.

This new austerity SOEs have suddenly adopted is a direct result of a campaign to cut extravagance and reduce red tape which has been in full swing since the Communist Party of China (CPC) leadership election in 2012.

The CPC has sworn to reduce waste, promote frugality and banned CPC officials from pomp, ceremony, bureaucratic visits and unnecessary meetings.

These annual dinners, often attended by government officials, evolved into nothing more than wining and dining away public funds, and an opportunity of buying gifts and trips, said Yu Nanping, a professor at the East China Normal University.

Many companies turned the year-end dinners into public relations events and a tool for cozying up to government officials, he added.

An annual conference can cost hundreds of thousands yuan, including planning, lighting, venue hire, catering, services and gifts.

A state-owned building material company in Beijing used to host annual conferences for officials, employees and clients not justin Beijing, but often flew guests to Yunnan or Fujian provinces, costing about 2 million yuan each time, according to the firm\’s public relations manager.

This year they canceled such trips and held a conference call with staff and clients in other cities, said the manager.

via The party is over for SOEs conferences – Chinadaily.com.cn.

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26/01/2014

* Poverty relief to become priority for poor counties – Xinhua | English.news.cn

The Chinese government seems to appreciate the management axiom that “you don’t manage what you don’t measure”. When implemented, this new ruling should be good for the poor as well as ensure that some local authorities don’t jack up their debt any further to increase their GDP.

“Chinese officials in poverty-stricken counties can stop worrying too much about regional GDP figures from now on, as the central authorities have moved to make poverty relief the priority for their work.

The country will reform the evaluation system for officials from poor counties by prioritizing the work of poverty reduction rather than the regional GDP, according to a guideline released Saturday jointly by the Central Committee of the Communist Party of China and the State Council, the Cabinet.

GDP figures will no longer be a standard for counties with fragile ecology or where development is restricted by the government to ensure sustainable growth, the guideline said.

\”The country will take improving the livelihood of people in poverty and reducing poor population as major indicators\” to guide officials in poor regions to put their work priority on poverty relief, it said.

Chinese leaders have recently set new standards for local officials, stressing that their performance cannot be simply based on regional GDP growth rates, but should include resource and environmental costs, debt levels and work safety.”

via Poverty relief to become priority for poor counties – Xinhua | English.news.cn.

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25/01/2014

Global hunt for top skills accelerates – Chinadaily.com.cn

China will speed up the exploration of immigration policies this year to attract skilled foreign workers, a senior official said on Thursday.

However, Zhang Jianguo, head of the State Administration of Foreign Experts Affairs, did not give details on when the policies will be introduced.

Experts said Zhang\’s remarks show that China may, for the first time, single out skilled workers as a special category in its general immigration polices, as the country faces a shortage of such workers.

Wang Huiyao, director of the Center for China and Globalization, said the government urgently needs to revise its immigration policies to attract more highly skilled foreigners.

\”China\’s population is aging quickly and we also need more skilled workers for our economic upgrading,\” he said. China needs to loosen its immigration policies, including giving citizenship to skilled foreign nationals, he added.

Such immigration policies are common in Western countries, which roll out favorable measures for the skilled foreign workers they lack.

China has experienced a talent \”deficit\” for years. In 2012 alone, more than 148,000 Chinese obtained overseas citizenship, while just 1,202 expatriates were granted permanent residency in China, according to a report by Wang\’s center on Wednesday.

China usually grants its version of green cards to foreigners in certain categories: Businessmen who have invested at least $500,000 in the country; technical personnel such as managers; people with skills \”needed by the State\” and spouses of Chinese nationals, providing their marriage has lasted at least five years and they have lived in China for at least nine months in each of those years.

via Global hunt for top skills accelerates – Chinadaily.com.cn.

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25/01/2014

* Shinzo Abe’s visit a signal to China, others – The Times of India

English: Japanese Prime Minister Shinzo Abe at...

With economics as the bedrock of a growing partnership, India and Japan are ready to move to the next level. When Japanese Premier Shinzo Abe meets Prime Minister Manmohan Singh on Saturday, the two sides are likely to kick off a top-level political-security dialogue between the two national security advisers, Shivshankar Menon and Shotaro Yachi.

Coming on the heels of the visit of the Japanese Emperor and Empress in December, the Abe visit will send a whole new set of signals to many in Asia and beyond – particularly the elephant in the room, China. Abe will not only be the first Japanese prime minister to be India\’s Republic Day chief guest, his presence at India\’s annual civil-military parade, an integral part of Indian life, will signal that the a pacifist Japan can be comfortable with a show of military strength.

The two sides are expected to announce more maritime exercises even though there will be no agreement on civil nuclear energy. Discussions on that have been stuck on non-proliferation commitments, finding a happy medium between the Japanese and Indian positions. India and Japan have started negotiations for the purchase of Japan\’s amphibian aircraft, US-2, which Japan plans to sell to India as a civilian aircraft, though it has military uses as well. The first set of discussions took place in the end of December, a second meeting is scheduled in the coming weeks.

The stepping up of defence and security cooperation between India and Japan has increased even as Japan\’s relationship with China and South Korea has plummeted in recent months. In what is being seen as an unprecedented war of words, Chinese and Japanese envoys around the world are waging a battle on the op-ed columns of newspapers regarding bilateral tensions on the Senkaku/Diaoyu islands.

via Shinzo Abe’s visit a signal to China, others – The Times of India.

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25/01/2014

China’s Latest GDP Numbers Are Under Scrutiny From Xinhua – Businessweek

This article ends on a high note: “Finally, and perhaps most important, China’s top leaders announced after a key meeting in December that from now on local officials’ performance will be evaluated on several criteria, including controlling debt and maintaining a better local environment, rather than just achieving high GDP growth.”

As China released gross domestic product and other economic statistics earlier this week, a perennial question has once again been raised: To what degree can the numbers be trusted?

Or as the Xinhua News Agency put it on Jan. 23: “One plus one equals two. But it’s not always the case, especially when you are talking about the calculating of local and national gross domestic product GDP data in China.”

What raised eyebrows was that the national GDP number came in below the figure one gets from totaling all the provinces’ GDPs. That presents, as Xinhua said in its unusually acerbic piece, “a somewhat peculiar math problem.”

While China’s official GDP in 2013 amounted to 56.9 trillion yuan ($9.4 trillion, up 7.7 percent from the previous year), the aggregate of all the provincial figures was about 2 trillion yuan more. And that’s not including three provinces (of 31 regions reporting), which have yet to publish their GDP numbers, according to Xinhua.

While this has “aroused suspicion among Chinese netizens that some growth-obsessed local officials have cooked the books,” (quite likely, Xinhua says later in its piece) there are other reasons for the discrepancy, the article explains.

One important reason: overlapping calculations, particularly when companies have businesses extending across different provinces. “Unlike the calculation of the nations’ GDP, where you have customs to clearly define the attribution of added value, it is very difficult to define which part of added value belongs to which provinces,” explained Cong Liang, an official with China’s state planning agency, who spoke at a press conference in Beijing on Jan. 22 and was quoted in the article.

via China’s Latest GDP Numbers Are Under Scrutiny From Xinhua – Businessweek.

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24/01/2014

Chinese consumers: Doing it their way | The Economist

IN THE the heart of old Shanghai is a magnificent villa that serves as the workplace of Guo Jingming, a provocative young film-maker. “Tiny Times”, his recent blockbuster, follows the travails of some fashionable college girls (pictured, in the walk-in closet of one of them). Its depictions of the high life, rarely shown in Chinese films, have set social networks ablaze; they have also been attacked by the People’s Daily for “unconditional hedonism”. Mr Guo says: “So what? Materialism is neutral, neither positive nor negative.” After all, he goes on, China’s cosmopolitans know at any given moment what movies are playing in New York and what fashions are on the Paris runways.

China’s once-drab and Mao-suited interior is not so far behind. In Mianyang, a middling city in the province of Sichuan, an enormous billboard featuring Miranda Kerr, an Australian supermodel, draped in Swarovski crystals welcomes shoppers to the Parkson shopping mall. It is one of half a dozen high-end malls in town. Luxury sales are exploding there. Local Audi and BMW dealers sell more than 100 cars each a month; Land Rover, Jaguar and Cadillac have just muscled in on the market.

 

Thirty kilometres (20 miles) away in Luxi, a town of 57,000 people, online shopping is hot. The first express-delivery office opened only three years ago, and handled perhaps ten packages a day; today, there are five, each handling 100 packages a day. Even 60km away, in rural Santai county where farm-workers are the customers, one modern shopping mall has sprung up and another is being built. “Customers are evolving very quickly from the low-end market to the middle and high-end,” says Yang Shuiying, proud general manager of the Zizhou shopping centre.

In the 1950s and 1960s the world economy was transformed by the emergence of the American consumer. Now China seems poised to become the next consumption superpower. In all likelihood, it has just overtaken Japan to become the world’s second-biggest consumer economy. Its roughly $3.3 trillion in private consumption is about 8% of the world total, and it has only just begun.

“The future of the world will be profoundly shaped by China’s rush toward consumerism,” says Karl Gerth, an expert on Chinese consumption at the University of California, San Diego. Although investment made the biggest contribution to China’s growth last year, and although private consumption’s share of output, now at 36%, fell between 2000 and 2010, that trend is unlikely to last, for several reasons.

First, boosting the people’s desire to consume is a stated goal of China’s leaders. Higher government spending on health care and pensions may encourage households to save less for such things. Higher interest rates may, paradoxically, discourage thrift if people reach their savings goals faster. Rising wages and an ageing population will also shift the balance towards consumption rather than saving. And although household debt is growing fast, China still has relatively little.

Besides, consumption has not fallen in absolute terms. It has, in fact, grown briskly—just not quite as quickly as the economy overall. In dollar terms, China contributed more than any other country to the growth in global consumption in 2011-13, according to Andy Rothman of CLSA, a broker. Moreover, China’s official statistics understate some consumption—spending on housing, for example.

A massive push to urbanise is also under way, which should produce tens of millions of richer citizens seeking retail therapy. McKinsey, a consultancy, forecasts that consumption by urban Chinese households will increase from 10 trillion yuan in 2012 to nearly 27 trillion yuan in 2022

via Chinese consumers: Doing it their way | The Economist.

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24/01/2014

China’s economy: In three parts | The Economist

CHINA’S economy, worth over $9 trillion in 2013, divides opinion. Often it divides it neatly in two: optimists contend with pessimists, apologists with alarmists, bulls with bears. Figures released this month encouraged both camps. China’s economy grew by 7.7% in 2013, a little faster than once feared. But a widely watched index of manufacturing, published by HSBC, a bank, fell for the fourth month in a row.

This binary split in opinion is too crude. To understand China’s economy today, it is more helpful to think in threes. Start, for example, with three forms of growth: in supply, demand and credit. Over the long run, China’s economic might depends on the size of its workforce and its productivity. This combination determines how much stuff China can supply without overstretching itself. Numbers released this week confirm that the supply-side limits on growth are gradually tightening.

 

The country’s urban workforce, which produces most of its output, is growing more slowly. The age group from which this workforce springs is now shrinking outright. The population of working age shrank by 2.44m in 2013, having already fallen by several million the year before.

This demographic turning-point (dubbed “peak toil”) has contributed to a marked slowdown in China’s potential rate of growth from the double-digit tempo of yesteryear. Whether the economy actually fulfils that (diminished) potential depends on a second kind of growth: that of demand. On the one hand, too little spending on goods and services will result in the underemployment of even a shrinking population (witness Japan). On the other hand, too much results in inflation.

By that yardstick, demand in China is still modest. It was enough to increase GDP by just over the government’s minimum threshold of 7.5%. But the economy did not grow fast enough to generate any inflationary pressure. Consumer prices rose by only 2.5% in the year to December. Prices paid to producers fell, for the 22nd month in a row. The Chinese economy is not overheating in any conventional sense.

China’s excesses take a different form. It is not the growth in demand that worries pessimists, but the growth in credit. The stock of outstanding financing for the private sector grew by about 20% last year, according to the central bank’s broad measure (which includes corporate bonds, equity issuance, and a variety of loans by banks and other lenders) even as nominal GDP grew by only 9.5% (see chart). Some of those loans are now turning ugly.

One credit product, sold exclusively through ICBC, China’s biggest bank, on behalf of China Credit Trust, a non-bank lender, is poised to default at the end of this month. It raised 3 billion yuan (over $490m) for Zhenfu Energy group, an ill-fated coal-mining venture, the vice-chairman of which was arrested for taking deposits without a licence. Zhenfu cannot repay its debts. The big question that remains is whether the product’s buyers, sellers or issuers will bear the loss.

China’s credit is not all this bad. And even the bad lending is not all bad in the same way. In fact credit, too, can usefully be divided into three categories, according to how it is spent, argues Richard Werner of Southampton University. Some is spent fruitfully, on new capital and infrastructure, increasing the economy’s productive capacity. Because lending of this kind adds to both demand and supply, it should result in higher economic growth without higher inflation.

Another chunk of credit is spent wastefully, either on consumption or on misconceived projects, such as bridges without destinations or coal mines without markets. These loans add nothing to the economy’s productive capacity, but they do add to demand. They make a claim on the economy’s goods and services, without adding anything to its ability to provide them. Credit of this second kind should, then, result in higher inflation, increasing nominal GDP but not real GDP.

The surprising lack of inflation suggests that much of China’s credit is instead of a third kind. It is spent speculatively, on existing assets, real or financial, in the hope they will rise in value. Because these assets already exist, they can be purchased (and repurchased) without adding directly to GDP or straining the economy’s capacity to produce new goods and services. Credit and asset prices can chase each other higher, even as consumer prices remain flat.

Because this third kind of credit adds little to economic growth, curbing it need not, in principle, subtract much from growth. China’s financial authorities have repeatedly stated their desire to shrink overstretched balance-sheets, especially among mid-tier banks, without discouraging the flow of credit to the “real economy”. But although this is entirely feasible in principle, it is a difficult trick to pull off in practice.

via China’s economy: In three parts | The Economist.

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24/01/2014

In India, Abe hopes to conclude Japan’s first defence sale in 40 years | Reuters

Japanese Prime Minister Shinzo Abe visits India this weekend, hoping to wrap up the first overseas sale of military equipment by Tokyo in nearly four decades and open up the world\’s biggest arms market for his nation\’s defence manufacturers.

English: Japanese Prime Minister Shinzo Abe at...

English: Japanese Prime Minister Shinzo Abe at the G8 summit in Heiligendamm. (Photo credit: Wikipedia)

Abe\’s visit to India will underline growing business and political ties between the two nations as they close ranks against mutual rival China, with the initial focus on the sale of amphibious search and rescue aircraft to India.

Japan and India are also trying to finalise an agreement on civilian nuclear energy that would open up the Indian market to Japanese players, officials said, reflecting another shift in Tokyo\’s policy on a sensitive issue. However, a Japanese official said a signing was unlikely during the visit.

Japanese officials say the proposed sale of ShinMaywa US-2i planes would not infringe Japan\’s self-imposed ban on arms exports because the aircraft to be given to India will be unarmed and can be used for civilian purposes.

Still, it will give India considerable aviation reach across the seas and could raise China\’s ire.

via In India, Abe hopes to conclude Japan’s first defence sale in 40 years | Reuters.

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24/01/2014

China retrieves $1.6 billion for migrant workers ahead of Lunar New Year | Reuters

China has recovered more than 10 billion yuan ($1.65 billion) of unpaid wages for its migrant workers in the last two months, officials said on Friday, underscoring a persistent problem that often leaves workers empty-handed before a key annual holiday.

Migrant construction workers gamble with cards after a shift at a construction site in Shanghai August 12, 2013. REUTERS/Aly Song

Many migrants only return home once a year for the lunar new year, which falls on January 31 this year. Gift-giving, including cash in red envelopes, is an important tradition, and theft spikes each year in the run-up to the holiday.

The campaign returned 10.9 billion yuan in unpaid wages to more than 1.5 million workers across China, Li Zhong, spokesman of the Ministry of Human Resources and Social Security, told a news conference.

via China retrieves $1.6 billion for migrant workers ahead of Lunar New Year | Reuters.

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23/01/2014

China must spend $330 billion more to do fair share on climate – report | Reuters

China must increase spending on emission cuts and clean technologies by 2 trillion yuan ($330 billion) to do its fair share to halt climate change, a report by Beijing\’s Central University of Finance and Economics said.

It urged the government to raise money from carbon markets to fund investments.

The report\’s conclusion contrasted with China\’s official policy that the main responsibility for ramping up action against climate change rests with developed nations.

China, the world\’s biggest-emitting nation, has already pledged to spend 520 billion yuan to help prevent global temperatures from rising more than 2C, according to Chen Bo, co-author of the report.

But that is only a fifth of what is needed if China – trailing only the United States on the list of history\’s biggest carbon emitters – is to shoulder a proportionate burden in global efforts to stop climate change, the report said.

The main responsibility for ratcheting up the extra funds should fall on the government, it said.

via China must spend $330 billion more to do fair share on climate – report | Reuters.

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