News

U.S. Companies In China Flourishing Despite Trade Dispute

Filed under: General, Trade — Edward @ 6:24 pm

Despite ongoing bilateral trade disputes, U. S. companies in China are profitable according to an American Chamber of Commerce survey released Feb. 16.

About three-quarters of companies surveyed were making a profit. The companies are gaining more access to domestic markets and are finding it easier to set up wholly foreign-owned enterprises, according to the survey of half of the chamber’s 900 member companies. Sixty percent of the companies surveyed last year said they had a wholly foreign-owned enterprise in China, compared with just 33% in 1999, reflecting loosening restrictions that required firms to have joint ventures, according to the survey.

Companies in recent years have also been able to introduce more products and services to the Chinese market, according to the survey.

Additionally, companies surveyed noted improvements in China’s bureaucracy, regulations, transparency and consistency in regulatory interpretation, although they noted there were still problems in these areas.

Difficulty finding skilled workers, especially management-level workers, and the rising cost of human resources, was instead cited as a top challenge. Some 41% of companies report being negatively affected by increased wages.

More than 80% of respondents now cite the Chinese market as their main reason for doing business in China, compared to 6% in 1999.

Poor intellectual property rights, however, caused 44% of the companies surveyed to slow or reduce investment in research and development in China.

By Cindy Sui, Agence France-Presse

China’s diplomacy must seize historic moment

Filed under: General — Edward @ 4:22 pm

China’s diplomacy is now functioning in an environment very different from before.

Since the founding of New China, we have never been in such an important position as we enjoy today. Mao Zedong once said that the Chinese nation should strive for a footing among the world’s forest of ethnic groups, a goal that energized Chinese diplomats for decades. Today we are not just any tree in the forest; we are growing into a great oak.

Yet this does not mean that we should go wherever our desire dictates.

Although our economy and negotiating power are fast expanding, when calculated in per-capita terms, they are still very small. While our influence on the outside world is rising, so is our dependence.

China’s economy is built on large imports and large exports, with foreign trade accounting for 10 per cent of GDP in 1978, 30 per cent in 1990 and 70 per cent in 2004. The country houses half a million foreign-equity enterprises, including 400 multinational corporations, forming a network of manufacturing, sales and development that links China with the outside world. With large-scale movements in materials, funds, technologies and human resources, we are more sensitive than ever to international politics and market changes.

At the same time, our reliance on the outside world for strategic resources is also increasing. This includes 36 per cent of our need for oil, 47 per cent for iron ore and significant amount of our aluminium, copper, precious metals and wood. With the current stage of economic growth, these figures will continue to rise, and herein lies our potential vulnerability.

Of course dependence is mutual. The world economy has shown growing dependency on China and the Chinese market. Now, when people study global economic trends, they not only look at the United States, but also watch growth in China. In 2004, when Premier Wen Jiabao announced plans for macroeconomic adjustment, it sent shockwaves around the world. Even the international stock markets responded to the announcement. This is a sign of the increasing acknowledgement of China as an important economic entity, which some have termed a “wake up call” for the world economy.

On the other hand, we have become more sensitive to the stability of international political and security situations. The stability of the international market and the shipping lanes are also highly important to us.

Each year we trade heavily with the world to a value exceeding US$1 trillion, most of which passes through the West Pacific shipping lanes. As time goes by, this issue will require more attention, and a greater need for co-operation with other countries. In 2004, China had a total of 29 million outbound travellers and 100 million inbound tourists. Such a huge flow of cross-border traffic demands a sound international environment.

Against such a background, China’s diplomacy is faced with constantly evolving tasks, details and objectives. They call for the protection of regional and world peace, and the preservation of opportunity through maximum collaboration, following the direction of the Chinese leaders’ statement that China pursues a foreign policy of peace, development and co-operation. This is a development and extension of the policy of independence, self-reliance and peace.

The report of the 16th National Congress of the Communist Party of China proclaimed that the first 20 years of the new century constitute an era of strategic opportunity for China, which we must grasp. The ninth section of the report, which dwells on foreign policy, alludes to “common development,” “common promotion,” “common interests,” “common efforts,” “common prosperity,” “common consultation” and “common preservation.” The seven mentions of “common” is a manifestation of China’s emphasis on international co-operation.

The top priority for our national interests is to guarantee the strategic goals for the third step of our development plan: growing into xiaokang shehui (a moderately developed country) in the years of 2020-50, and fulfilling the mission of revitalizing the Chinese nation. Whilst we may have missed several important historic opportunities, we are now faced with a new opportunity that came only after generations of Chinese had fought hard with sweat and blood. To grasp this opportunity, we need not only diligence and hard work, but also cool-heads and intelligence.

China needs to maintain this opportunity. There are many external challenges, but the biggest challenges may lie with ourselves: to adapt to a new environment in the shortest possible time, and to accurately gauge and evaluate our own interests and make good use of our resources.

China’s development is not only a major event for China, but is also unprecedented for the world. Western countries took about 200 years to industrialize, consumed a large amount of the world’s resources and inflicted hardship upon many other countries. Yet their development resulted in the achievement of a modern lifestyle for only 500 million people. China will have a population of 1.5 billion people by mid-century. The impact on the world for such a mammoth process of industrialization, within such a short timeframe, is inconceivable. Therefore it is quite understandable that the world is watching China closely, and some even express concern over what China’s development will mean to them.

The most important thing for China is to promote a more stable environment for co-operation so that we can grow. In other words, in addition to ensuring our own security, we need to take a step forward to create an external atmosphere and environment that is favourable for co-operation between us and other countries, rather than restriction or containment against us. We need to keep the world updated about our intentions, to advertise what is really going on in our country and let the world know us better and accept us. That is why we

need to move to a more proactive diplomacy that involves taking more initiatives.

In the eyes of the world, China is no longer a remote, mysterious and backward country, but one that stands among the major powers and plays its own role. Will China be a constructive or destructive new member of the new order?

That is a question raised by many countries. But we may also see that no country has so far formed a preconception, either positive or negative, about us. It will be very much our own attitude, our performance and what we make of this historic opportunity that will determine our future.

We now have more diplomatic resources at our disposal and we can do many things. For example, in the neighbouring region, we have worked for and participated in multilateral co-operation, including East Asia co-operation, Shanghai Co-operation Organization and Korean Peninsula nuclear talks. We have worked to stabilize relations with the United States and other Western nations and provided more support to developing nations.

The author is China’s ambassador to Australia. The article is an excerpt from her speech at Peking University.

Source: China Daily 20 February 2006

Most comprehensive material engineering series published in China

Filed under: General — Edward @ 4:16 pm

China published its most comprehensive material engineering series Saturday, in which many important technique parameters are released for the first time, to facilitate research in the field.

The series, dubbed the “China Materials Engineering Canon”, is the country’s most complete material engineering reference to date, marking a milestone in China’s science and technology publishing history.

“The reference series is conducive to China’s innovation capability enhancement, manufacturing competitiveness upgrade and industrial restructuring,” said the director of the book’s compiling committee Lu Yongxiang, also president of the Chinese Academy of Sciences (CAS) and chairman of the board of directors of Chinese Mechanical Engineering Society, at Saturday’s press conference.

The 70-million-character, 26-volume series was compiled by 39 academicians of the CAS and the Chinese Academy of Engineering, China’s two think-tanks, and more than 1,200 university professors and leading experts in the field through five years of strenuous work, covering 15 subjects of material engineering.

Zhou Lian, chairman of the board of directors of Chinese Materials Research Society, said the book series summarizes China’s research in material engineering during the last decade and integrates advanced foreign material technologies to help domestic product research and development, energy-saving and environmental protection.

Machines and equipment in some Chinese factories are big and clumsy, many based on technologies from the former USSR. Some vital domestic-manufactured machinery have failed to reach the market due to problems with material-selection.

The canon offers the latest technique parameters, graphs and practical scientific research applications for sectors like manufacturing, metallurgy, information industry, shipping, weaponry, aeronautics and automobiles to refer to, Zhou said.

Source: Xinhua 19 February 2006

World Bank sees robust growth rate for China

Filed under: General — Edward @ 6:21 pm

THE World Bank assessed China’s economic outlook for this year as “benign,” with increasing growth coming from the domestic side and the trade surplus shrinking.

The gross domestic product generated by Asia’s second-biggest economy is expected to rise 9.2 percent this year from last year’s revised growth figure of 9.9 percent, the bank said in its quarterly update, released yesterday in Beijing.

In its report, the bank said domestic demand has been “firmly taking” the lead over China’s net trade since the second half in 2005. Greater consumption - though still lagging GDP growth - was supported by strong income growth, especially in urban areas, and increasing consumer credit.

The World Bank also said China will benefit from solid export demand, while profits and credit growth suggest that investment remains robust.

The report, however, said China faces significant challenges such as over-reliance on investment and insufficient growth in consumer spending caused by a slow rise in rural incomes.

The report said it will “take time” for China to change the composition of its domestic demand.

About 60 percent of the nation’s 1.3 billion people earn a living from agriculture. China last year abolished its long-standing farm tax - one of the central government’s steps to encourage citizens to spend more and break a current economic cycle that relies heavily on exports and fixed-asset investment.

The World Bank report also said that rising domestic consumption will help China narrow its trade surplus this year.

The surplus tripled to a record US$102 billion last year in annualized terms amid surging export volume. That led to record foreign-exchange reserves of US$818.9 billion at the end of December, according to the People’s Bank of China.

The World Bank report, however, said China’s current account surplus is set to narrow this year. Among the indicators, the value of the country’s net exports as a proportion of economic growth fell to near zero at the end of last year on higher demand for services such as medical treatment and education. The report also forecast that China’s inflation rate in 2006 would be unchanged at 1.8 percent.

(Fu Chenghao in Shanghai Daily news Feb.10 2006 page A2  )

More oil, gas reserves verified in Xinjiang

Filed under: Energy — Edward @ 5:48 pm

The Turpan-Hami Oilfield Co., a major oil and gas producer in northwest China’s Xinjiang Uygur Autonomous Region, made advances in both resource prospecting and oil and gas production last year.

Last year, the company verified 16.12 million tons of oil deposits and 5.18 billion cubic meters of natural gas reserves, of which 3.08 million tons and 3.04 billion cubic meters, respectively, are workable, company sources said.

According to the sources, last year the Turpan-Hami Oilfield increased its annual oil and gas production capacity by 200,000 tons and 270 million cubic meters, respectively.

In 2005, the company produced 2.09 million tons of crude oil, 1.53 billion cubic meters of natural gas, 186,000 tons of liquefied natural gas and 84,000 tons of methanol.

The company’s sales revenue totaled 7.62 billion yuan (939 million U.S. dollars)last year, the sources added.

According to China’s economic development strategy, Xinjiang will become an important energy supply base for the nation.

Source: Xinhua

Next Page »