Asia Manufacturing News February 2011

ASIA MANUFACTURING NEWS • FEBRUARY 2011 1

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2 ASIA MANUFACTURING NEWS • FEBRUARY 2011


CONTENTSFebruary

2011

NEWS❒❒❒❒❒❒

44444 DEMAND FOR MOTORCYCLES TOAPPROACH 55 MILLION UNITS IN2014

44444 LARGE GROWTH IN EQUITIES FORCHINESE HIGH NET WORTHINDIVIDUALS

55555 GOODMAN SIGNS MOU TODEVELOP PREMIER BUSINESS ANDLOGISTICS HUB IN CHINA

66666 A GOOD STORY FOR GOOGLE INCHINA HARD TO FIND

77777 HYPERTHERM Q&A: METAL-CUTTING TRENDS IN ASIA

88888 A*STAR MUSTERS A LINE-UP OFINDUSTRY PLAYERS

1010101010 JAPANESE VISIONARY BOOSTEDNEW ZEALAND’S TECHNOLOGY

1414141414 KIWI MANUFACTURING INFLUXINTO THAILAND

99999 FLYDUBAI SECURESAIRCRAFT FINANCING

TTTTThe financing will take careof the next nine aircraftflydubai is due to receive

and secures all the airline’sfinancing requirements until June2011.

Through all the economic turbulence thathas occurred in the world of late, Asiancountries and businesses continue to forge

ahead.

In our part of the world we suffer the storms andtsunamis, rising food prices and inflationarycircumstances common to today’s globalisedworld.

Asia Manufacturing News will this year bring youthe stories of the manufacturing heroes acrossAsia. The companies which are continuing todream the dream, develop the new products andfind new markets for them.

And there are opportunities everywhere as youcan read about in our story on the demand formotorcycles in China over the next few years.Who wants to manufacturer 55 million motorcy-cles by 2014? Come on, put your hand up, this isa golden opportunity and your time has come!

Even the web brings its consternations and issues.Google isn’t popular in China and the competitionbetween Google and Chinese internet operators isno different from a lot of the competitive issuesbetween China and the USA when it comes tobusiness.

Take, for another example, the Chinese currency.Will it go global? Is this idea realistic? Is it anotherarm wrestle with USA or a natural growth path?

In 2011 we want to hear of your success stories –the technology your company has made, the newidea which is going to change the world. Yourcompany is important we want to know whereyou are going in 2011.

– Doug Green

2011 a goodyear formanufacturers



1515151515 CROSS-SELLING PROVIDES AGROWTH OPPORTUNITY FORRETAIL BANKS IN SINGAPORE

1515151515 FUTURE PLANNING FOR HIGH NETWORTH IN HONG KONG

1616161616 NET NEUTRALITY: WHAT’S ALL THEFUSS ABOUT?

1818181818 TRIBRID MODELLING PRODUCES“WAFFLE” PHONE FIRST AT LG

1919191919 PRODUCTION CAPACITY FORLARGE-SCALE MACHINESEXPANDED

2020202020 ONLINE BANKING CHANNEL MOREPOPULAR IN ASIA-PACIFIC

2121212121 CHINA ATTRACTIVE AT PRESENT

2121212121 SINGAPORE MOST TAX-FRIENDLYFOR ENTREPRENEURS

2323232323 APPETITE FOR RISK INCREASESFOR WEALTHY INDIVIDUALS INSINGAPORE

NEWS❒❒❒❒❒❒

1212121212 ICONA SOLUTIONSADDRESSES CHINESEAUTOMOTIVE INDUSTRY

2727272727 ARE YOUR PRODUCTSGETTING TO THEIRMARKET?

Asia Manufacturing News is published bi-monthly and offers the readerbusiness information and news. Asia Manufacturing News welcomeseditorial contributions and encourages readers to share their reflectionsand views with us. Asia Manufacturing News uses information providedin good faith. We give no guarantee of accuracy of the information. Noliability is accepted for the result of any actions taken or not taken onthe basis of this information. Those acting on the information andrecommendations do so entirely at their own risk.

Managing Editor: Doug Green phone: 0061 06 870 9029Advertising Manager: Max Farndale phone: 0061 06 870 4506Web Master: Dan Browne.

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NNNNNew partners will help Chineseautomotive manufacturersincrease the perceived quality of

their vehicles.

DDDDDespite the best efforts of aninternational naval police forcepatrolling the Gulf of Aden and

nearby seas, gangs of ruthless criminalscan still capture highly valuable cargoships and hold them to ransom.

2424242424 TRADE SHOWS

2525252525 PENANG PORT’S MAIN LINE VISIONSHARED BY KONECRANES GROUP

2626262626 POWER LIFTING PARTNERSHIPPROVIDES ENERGY GENERATORS

2828282828 CAMBODIAN ROOT SERVER TOSPEED INTERNET ACCESS



news

These comparatively newproducts will account for overthree-fourths of aggregatemotorcycle market growth. Gas-powered internal combustionengine (ICE) motorcycles will alsorecord solid growth, helping tostrengthen China’s position as byfar the world’s largest motorcyclemarket. ICE motorcycles andelectric motorcycles, whilecollectively referred to as“motorcycles,” tend to appeal todifferent types of consumers.Different factors drive growth foreach type of motorcycle.

These and other trends arepresented in Motorcycles inChina, a new study from theBeijing office of The FreedoniaGroup, Inc., a Cleveland-basedindustry research firm.

Sales of traditional gasmotorcycles will increase 3.9

percent annually to 23.3 millionunits in 2014.

Gains will be driven by increasingeconomic activity and risingpersonal income levels in thecountry’s rural and semi-ruralregions, which are and will remainthe most important markets forthese vehicles. Governmentrebates for purchases of ICEmotorcycles by rural residents aspart of the “Automobiles andMotorcycles to the Countryside”program will also stimulatedemand. However, restrictionsand even outright bans on ICEmotorcycles in many Chinesecities will prevent sales fromexpanding at a faster pace.Cruisers are the most popularmodel type among Chineseconsumers, representing 43percent of gas motorcycle sales in2009. However, their position in

the ICE segment has beenundermined in recent years by thediversification of motorcycleofferings in China. Going forward,trikes and sidecars will seedemand expand at the fastest rateof any ICE motorcycle model type.

The market for electricmotorcycles in China is expectedto grow 11.0 percent per annumthrough 2014 to 31.6 millionunits. Demand for these newerproducts will continue to expandat a rapid pace through theforecast period, as increasingnumbers of urban dwellers turn toelectric motorcycles for theirtransportation needs.Improvements in vehicledurability and in battery powerand longevity have allowedelectric motorcycles to meet animportant need among urbandwellers seeking to upgrade frompedal bicycles but unable toafford automobiles.

nextSTEPVisit: www.freedoniagroup.com.The Freedonia Group, Inc.

CHINA The share of total fundsthat Chinese high net worthindividuals hold in equities is setto increase strongly, according tothe latest research.

Chinese high net worthindividuals (HNW) currently holda lower proportion of fund inequity compared to peers in theAsia-Pacific region. Datamonitorresearch* shows that this willchange, with strong growth inequity holdings forecasted overthe next two years.

“Chinese HNWs have a largeproportion of their wealth as cash

or near-cash products. This willchange over the next two years,with equity holdings becomingthe most important component ofChinese HNW portfolios instead.This movement of funds willprovide opportunities for thefinancial services industry,” saysPetter Ingemarsson, seniorfinancial services analyst atDatamonitor.

Equities currently constitute a fifthof Chinese HNW portfolios, butwill in two years have reached aproportion of 46%. This is ahigher percentage than in othercountries in the region. The

Datamonitor survey was carriedout in China, India, Taiwan,Singapore and Hong Kong.

The main driver for the growth inequity holdings is a growingnumber of Chinese HNW lookingfor higher risk investments.Chinese HNWs are becomingmore polarised in their riskattitudes. Around half of HNWs inChina will have a significantlyhigher appetite for risk in twoyears, which contrasts stronglywith the broader APAC area.However, a fifth of Chinese HNWsare expected to have asignificantly lower appetite for risk

Demand for motorcycles to approach55 million units in 2014

Demand for motorcycles in China will increase 7.6percent annually to 54.9 million units in 2014. Electricmotorcycles are expected to surpass gas motorcycles to

become the leading motorcycle type sold in China.

Large growth in equities forChinese high net worth individuals



news

The key points relating to theMOU are:

➠ Significant mixed usedevelopment project overfive square kilometres, whichis expected to be deliveredover the next seven years

➠ Goodman will participate asco-ordinator and masterplanner for the project andwill take a fee for service role

➠ Goodman expects togenerate fee income over thelife of the project and willalso consider making furtherinvestments for itself and itsinvestment partners in thedevelopment of logistics andbusiness park product on thesite on a case by case basis.

Over the next seven yearsGoodman will work jointly withits affiliates to develop a fivesquare kilometre parcel of landinto an international standard,environmentally friendly mixeduse business park. This willconsist of offices and modernlogistics facilities and will beco-located with residentialhousing and associatedamenities to create a sustainablecommunity.

Mr Greg Goodman, GoodmanGroup CEO said, “As thestrategic partner of Langfang andthe master planner of the park,Goodman will use its worldwideexpertise in business parkdevelopment, master planningand property management to

develop a comprehensive andsustainable logistics andbusiness hub to cater to theneeds of modern day business. Itwill also provide tremendousopportunities for local jobcreation.”

“Goodman will draw upon itsglobal partners to introduceinternational investors andbanking groups to provide fullscale financing support. Thisprovides the Group importantaccess to development land in acapital efficient manner andallows Goodman to promote theproject and development inChina to internationalcustomers,” he added.

Langfang occupies a keyposition between Beijing andTianjin and is within the HebeiProvince. Its proximity totransportation networksincluding rail, airports and roadunderscores its importance as alogistics hub. Often called“China’s Silicon Valley”,Langfang is set to further benefitfrom plans for a high-speedrailway link between Shanghaiand Beijing, with the travellingtime between Beijing andLangfang reduced to 10-15minutes. Extensions to theBeijing ring road network willfurther enhance Langfang’sability to support continuedeconomic growth in northernChina.

The MOU with Goodman willstrengthen the delivery of

international best practice inproject development, planning,sustainability and logisticsmanagement in China. Itsignifies a concrete step towardsenhancing the expansion of thelocal property development andlogistics industry. Goodman’sapproach to sustainability wasone of the key factors whichattracted the LangfangGovernment to Goodman asthey considered the Group to bewell positioned to help themdeliver on their vision ofcreating a model sustainablecity.

Goodman’s Chief ExecutiveOfficer, Greg Goodman said,“This announcement, which hasbeen made possible through thestrength of our cooperation withthe China InvestmentCorporation (CIC), marks animportant step in the continueddevelopment of our Asianbusiness and is a furtherindication of our growing andlong-term commitment to theChina market. Goodman expectsto generate fee income over thelife of the project and will alsoconsider further investments foritself and its investment partnersin the development of logisticsand business park product at thesite on a case by case basis.”

The MOU builds on Goodman’ssuccessful track record inGreater China, where it managesa total portfolio value of aroundUS$1.6 billion in the keylogistics hubs of Pearl RiverDelta, Yangtze River Delta andBohai Rim Regions.

nextSTEP

Visit: www.goodman.com

Goodman signs MOU todevelop premier business and

logistics hub in China

Goodman Group has announced that it has signed aMemorandum of Understanding (MOU) with theLangfang Municipal Government to participate in the

development of a premier business and logistics hub for thegreater Beijing-Tianjin area in northern China.



news

His comments follow on the backof Baidu’s results. These show itcontinues to dominate the searchengine landscape in China. Baidualso reported its advertisernumbers have increased byalmost 26% on 2009 levels,reaching 272,000 - a clear sign ofthe deep chasm in the paid searcharena between it and its nearestrival, Google.

Since June, Google has curtailedits searchable Web index tocomply with China’s censorshiplaws. According to Pouros, as itnow provides fewer results, itcannot post as manyadvertisements as it hadpreviously. Furthermore,research earlier this year fromleading media-focused research,publishing and consultingcompany, Screen Digest,indicates almost two thirds ofsearch users are happy to useBaidu or smaller Chinese searchengines.

According to Cyrine Amor,advertising analyst at ScreenDigest, Google is losing marketshare with the problems itencountered lately with thegovernment. Moreover, Googleis also about to end its contractswith seven adwords resellers inChina. No reason has beenprovided for this but Ms Amorsays this will likely see Googleísshare slashed by up to 10-12%.

Screen Digest’s figures fromearlier this year show Googleaccounted for 33% share of theChinese search market, behindBaidu.

In paid search, Baidu has beenenjoying a healthy lead. In early

2010, Screen Digest estimatedtotal online advertising revenuesin China would reach almost 1.5billion in 2010, with Baiduaccounting for the lionís share($945 million), then Googlewith $472 million.

“By having over 60% share ofthe search market in China, hasBaidu reached the tipping pointmuch as Google had in westernEurope, where its growth from60%-90% share was incrediblyrapid, with its competitorslargely incapable of closing thegap? Perhaps it has”, saysPouros.

What is certain, according toPouros, is that Google needs anew game plan if it is to achievethe momentum required to catcha clear home grown marketleader.

Pourous is also an experiencedconference speaker and deliverssearch marketing trainingcourses with the IDM and NMA,as well as carrying out in-houseconsultancy.

Greenlight is a leadingindependent, award winningsearch specialist marketing andtechnology firm, the largest of itskind in Europe and the fastestgrowing. With over 100 blue-chip clients including Santander,Vodafone UK, New Look,Interflora, Co-operativeFinancial Services,

Nespresso and ghd, Greenlightis a leader in the searchmarketing space, and isrecognized worldwide for itscommitment to delivering recordROI for its clients and investingin the future of search.

Greenlight publishes widely readindustry reports, original research,speaking at trade events, anddelivering a highly respectedsearch training programme inconjunction with the IDM.Founded in 2001, Greenlight isheadquartered in London, withoffices in New York.

Andreas Pouros is Chief OperatingOfficer at Greenlight. He has beeninvolved in search marketing foreleven years, working for some ofthe biggest and most prestigiousblue chip companies in the world.Andreas is responsible for aninternational team of Searchconsultants, developers,programmers, and copywriters. Inhis role, he provides guidance to amultitude of well-known brands,including Santander, Monarch,Vodafone UK, Thomas Cook, NewLook as well as a number ofgovernment bodies.

Andreas is an established searchmarketing commentator whoseopinions have been published inNMA, Marketing, B2B Marketing,Media Week, Investors BusinessDaily, Media Post, Wall StreetJournal and Journalism.co.uk.

nextSTEPVisit:www.greenlightsearch.com

A good story for Googlein China hard to find

By Andreas Pouros,Chief Operating Officer,

Greenlight

Finding a good story for Google in China is going to betough, says Andreas Pouros, chief operating officer atGreenlight, a leading independent search specialist

marketing and technology firm.



How would you say the metalcutting industry fared in 2010,globally and regionally?

There definitely has been animprovement over 2009 withrecovery in the Asian region, butless so in the international scene.Re-stocking of inventories mayhave contributed in part to theimprovement in our business.

Where did Hypertherm see thegreatest growth in the region, andwhat were some notable trendsthere?

China, which recovered quicklyafter the 2008 financial crisis, is inthe forefront of growth. This is notunexpected as China has been themain engine propelling the Asiaregion onto the recovery path. Theconstruction and agriculturalequipment segments haverebounded strongly, fuelled byinfrastructure development. Theshipbuilding industry, however, isstill languishing due to a recordnumber of ships beingdecommissioned, and marinetransportation suffering from theslowdown in US and Europe.

What about other Asian marketsthat you serve?

The entire ASEAN region did wellin recovery with some notableexceptions like Thailand thatfaced political unrest. India,which is more insulated fromexport orientation andinternational banking, almostdidn’t skip a beat and maintainedits contribution to the industry.

Which industries have impactedthe metal cutting business themost this past year?

Construction and infrastructure-related developments have both

the interview

made significant contribution toour business in 2010.

What significant technologicaladvances did the industry enjoyfrom Hypertherm this year?

We introduced a number of newtechnologies in 2010. With oneof the advancements, businessesare now able to improve cut-to-cut cycle time and consumablelife, enhancing productivity andoperational cost-savings. Withanother development, the uniquecombination of our power supply,motion control systems andsoftware help to produce highbolt-hole quality. And mostrecently, we launched a new high-powered plasma system featuringa patent-pending technology thatenables both piercing and cuttingof very thick stainless steel andaluminium.

How widespread is the use ofoxyfuel, plasma and laser in metalcutting applications across Asia?

Oxyfuel is still the dominantmetal-cutting method in mostemerging markets in Asia andthese present significantopportunities for plasma forproductivity reasons. With lasers,the market is niche withapplications specially designed forprecision. But where there aresome overlaps between laser andplasma, especially when metalthickness increases, plasmatechnology has gained an edge.This is because recenttechnological advancements haveenabled cost-savings whilepreserving cut quality.

What can metal cutting usersexpect from industry suppliers likeHypertherm in the next fewyears?

Our users can expect greaterperformance, reliability and easeof use with new-to-marketapplications that will furthersimplify the intricacies oftechnological integration.

What sustainability andenvironmentally-friendlyinitiatives, if any, doesHypertherm undertake, and what’sthe impact to-date, as well as theexpected effects in upcomingyears?

As a company, Hypertherm iscommitted to sustainability withgreen efforts as one of ourcorporate priorities in 2011.Product-wise, we will continueintroducing new plasmatechnologies that offer higherperformance with lower powerconsumption, enabling users to domore with less impact onenvironmental resources.

Hypertherm Q&A:Metal-Cutting Trends in Asia

Soo KT, General Manager,Hypertherm Asia

Asia Manufacturing News recently conducted a Q&A sessionwith Soo KT, General Manager, Hypertherm Asia.



report

Four companies, namely, RollsRoyce, Vestas, SP PowerGrid andCEI Contract Manufacturingentered into strategic partnershipswith the Agency for Science,Technology and Research(A*STAR) to develop smart gridand distributed energy solutions.This was announced at thegroundbreaking ceremony of itssmart grid research facility of theExperimental Power Grid Centre(EPGC) by Guest-of-Honour, MrRavi Menon, Permanent Secretary,Ministry of Trade & Industry.

The technologies and solutionsbeing jointly developed will formthe key components to beintegrated into the intelligent gridsystem. Said Mr. Lim Chuan Poh,Chairman, A*STAR: “Smart gridR&D is critical to transformingSingapore into a smart energyeconomy and EPGC is animportant enabling infrastructurethat will bring us a step closer torealising an intelligent nationalenergy grid. With thisinfrastructure in place, Singaporewill be well-positioned to takeR&D in energy solutions to thenext level.”

He added: “Innovation anddevelopment of energytechnologies are vital to thegrowth of the global smart gridindustry, which is expected to beworth US$187 billion by 20151.As Singapore moves towards itsgoal of becoming Asia’sInnovation Capital, the EPGC willprovide an innovative researchplatform for public-privatepartnerships in the emerging areaof energy technologies. We arepleased to have garnered stronginterest from a mix of MNCs andlocal enterprises to collaboratewith us in this endeavour. This is a

strong endorsement of thepotential of EPGC. We hope toanchor more companies to furthershape the R&D agenda and totranslate research into usefulapplications for economic goals.”

About the EPGCWhen completed in 2011, theEPGC research facility will be thefirst experimental smart gridresearch facility of its kind inSouth-east Asia. It will be built bya consortium led by MeidenSingapore. Together with theCommand and Control Centre inFusionopolis, the EPGC will be aworld-class research centre tousher in new smart gridtechnologies for intelligent anddecentralised power distribution,interconnection and utilisation.

Commenting on the R&Dconducted at the centre, AssociateProfessor Ashwin Khambadkone,Programme Director, EPGC said:“Our activities will be positionedupstream, towards the researchand development of newtechnologies with a view tocommercialisation in the future.By leveraging on the widespectrum of existing researchcapabilities across A*STAR’sresearch institutes, from materialsengineering and packaging toinfocomms, data communications,and high performance computing,the centre is able to accommodatea wide range of R&D activities inareas such as intelligent grids,integration of renewable powergeneration and vehicle to gridsystems, and the development ofnew generation energymanagement systems.”

Dr Keith Carpenter, ExecutiveDirector of A*STAR’s Institute ofChemical and Engineering

Sciences (ICES), where the facilityis located, added: “The EPGC isproof of the Singaporegovernment’s serious effort tocontribute to the future of smartenergy systems. Locating thefacility at Jurong Island will notonly spur research activities due tothe proximity to available sourcesof energy such as natural gas andhydrogen, it will also complementongoing research programmes atICES on energy, including biofuelsand solid oxide fuel cells.”

Making Singapore a LivingLaboratoryBy working with partner agencies,namely the EconomicDevelopment Board (EDB), EnergyMarket Authority (EMA), JTCCorporation (JTC) and NationalEnvironment Agency (NEA), EPGCis able to participate in this whole-of-government approach to makeSingapore a ‘living laboratory’ forcompanies around the world todevelop, test-bed and implementnew energy technologies.

Professor Low Teck Seng, DeputyManaging Director for Research,A*STAR commented: “EPGC, withits focus on upstream R&D, is anintegral part of the entire smartgrid value chain. With EPGC, wewill be able to attract companiesseeking to carry out smart gridRD&D in this region to anchortheir activities in Singapore.Being the first experimentalresearch facility in the South-eastAsian region, EPGC has acompetitive advantage in beingable to provide companieswishing to have a foothold in thesmart grid sector, either locally orglobally, the opportunities toparticipate in ‘live’ demonstrationof power grid-related projectsright here in Singapore.”

– Clement Ng

1 According to Global IndustryAnalysts, April 2010

A*Star musters a line-up ofindustry players

Groundbreaking A*STAR’s Experimental Power GridCentre (EPGC) on Jurong Island has paved the way forcutting-edge R&D to develop Singapore as a ‘living

laboratory’ for smart grid solutions.



focus

flydubai, Dubai’s first lowcost airline, has announcedaircraft financing worth

more than US$750m in dealswith GECAS (General ElectricCapital Aviation Services) andBBAM.

The financing will take care ofthe next nine aircraft flydubai isdue to receive and secures allthe airline’s financingrequirements until June 2011.

Ghaith Al Ghaith, CEO offlydubai, said: “I am delighted tobe able to announce this aircraftfinancing today. These deals arevery significant for flydubaibecause this committed moneysecures the next nine aircraft weare due to receive and mean allour financing requirements untilJune next year are taken care of.

“We already have agreements inplace with both GECAS andBBAM and it is clear from theirwillingness to enter into furtherties with us that they have beenpleased with what flydubai hasdelivered so far. These are someof the largest aircraft financers inthe world and their faith inflydubai is a huge endorsementof us and our success since ourlaunch.

“When we went out to themarkets this time to seekfinancing for our aircraft wewere overwhelmed by theresponse. At the end of the daywe received offers for far moreaircraft than we needed tofinance, which is a very niceposition for a young andambitious airline to be in. Ibelieve this is a reflection notonly of our position but also ofthe confidence the financialcommunity around the worldhas in Dubai.”

Both deals are eight year termsale and leaseback agreements.

The agreement with GECAS isfor six aircraft, taking the totalnumber of flydubai aircraftGECAS finances to 10. BBAMare adding another three aircraftto make their total commitmentsix.

Norm C. T. Liu, President andCEO of GECAS, said: “During itsfirst 15 months of operations,flydubai has worked to build asolid foundation for futuregrowth. GECAS is pleased tocontinue our partnership withthis rapidly expanding airline,and provide the financialsupport they need to continuetheir impressive growth.”

Steve Zissis, President of BBAM,said: “We signed our firstfinancing deal with flydubai atthe same time the airlineannounced its historic aircraftorder for more than 50 Boeing737-800NGs at Farnborough inJuly 2008. We’re very pleased to

flydubai secures aircraftfinancing

be able to strengthen ourrelationship with flydubai andlook forward to many moreyears of partnership. Ourpartnership with flydubai is anexcellent example of BBAM’sexpansive global footprint andability to provide solutions forairlines in every stage ofdevelopment.”

flydubai began commercialflights on June 1, 2009. Sincethen the airline has grown to afleet of nine B737-800NGaircraft operating to 22destinations within a five hourflight radius of Dubai. Four moreaircraft are due to be receivedbefore the end of this calendaryear. These will be the newBoeing Sky Interior 737-800NGand will be fitted with therevolutionary new type of in-flight entertainment system fromLumexis that the airlineannounced earlier this year.

Passengers disembarking from one of flydubai’s low cost flights



profile

Scollays, as the firm was called inthose days, was to make a namein electronics via its work withNEC. In the its early days, though,the firm was a commodity trader,especially in scrap, and it was inthis role that the firm made itsearly contact with Japan and withNEC, the company that was verysoon to dominate the high-endelectronics sector.

Dr. Kobayashi devoted his entireworking life to NEC. He served asthe president of NEC from 1964until 1976 and then as chairmanuntil 1988, overseeing thecompany’s expansion from itsinitial business of telephoneequipment into computers andcomputer chips.

Though his background wasentirely technical, Dr Kobayashiwas an evangelical public speakeron the place of electronics in theworld. He spoke in fluent,idiomatic English.

Amazingly, for a scientist, he hadthe ability to relay his message inhuman terms - quite literally.

In Wellington, in the very early1980s, he was asked if there wasany special formula behindJapan’s near-dominance of theworld electronics market.

“You can start by looking at me,”he exclaimed. “After the war Iweighed seven stone. The onlydirection I could go was up. Therewere no alternatives. There weremillions like me. So that was whatwe did.”

There are elements here of courseof Asian, and especially ofJapanese, self-effacement

There is also the hard-core truththat a focus on sheer survival doesconcentrate the human purpose.

Today, NEC is the largest supplierof personal computers in Japanand is the second largestsemiconductor manufacturer inthe world behind IntelCorporation of the United States.

Dr. Kobayashi is best known in theglobal telecommunications andcomputer industry for coiningNEC’s watchword, ‘’C & C,’’standing for computers andcommunication, a reference to hisbelief that the products of thecomputer and of thetelecommunications industrieswould merge.

Curiously, in New Zealand, at thistime in the early 1980s, this wasby no means the conventionalwisdom. Many believed that theinformation industry would hewto a very sectored structure inwhich the key entities wouldproceed in parallel, or evendiverge.

This view was born out by thefailure of several early attempts toblend desktop computing and thetelephone. One such failure wasInternational Computers Ltd’s flopwith the One Per Desk, whichcombined a phone with acomputer.

Early experiments in similarblendings by Datapoint of the USalso failed.

So Dr Kobayashi’s determinationto bet NEC on convergence was atthis time viewed as a risk.

His convergence clarion call inWellington came not long after he

had originally coined theapproach. He had first used theexpression at atelecommunications conference inAtlanta in 1977.

Now, of course, the computer andcommunications industries, aswell as consumer electronics areall converging in the form of theinternet.

Dr Kobayashi was a scientist whoblended a love of the ultra bigpicture with a diligent interest inhow it was to be carried out. Withthe Scollay interests he broughtabout New Zealand’s firsttelecommunications research anddevelopment company, TSSC.

This was a joint venture formed in1982 by Telecom, NEC andScollay Holdings Limited. TSSCprovided local and overseassoftware development, installation

Japanese visionary boostedNew Zealand’s technology

Dr Koji Kobayashi of NECwas a decisive figure in

the technologicaldevelopment of New

Zealand.

Bill Scollay, a big gruff, friendly trader who can now beviewed as a pioneer of New Zealand’s businessglobalisation, introduced him to New Zealand in the post

war years.



profileservices, and technical support forNEC’s NEAX 61 public digitalswitching systems that form thebackbone of the nation’s publictelephone network.

The benefit to New Zealand ofthe TSSC joint venture was that itgave this country a hand in thedominant electronic technologyof its time, which was storedprogramme control telephoneexchanges. Until that timeexchanges had been mechanicalconnection junctions. Understored programme control theybecame entirely digital and themoving parts were gone.

Koji Kobayashi, who died in 1996aged 89 was born in YamanashiPrefecture, near Mount Fuji, andearned a degree in electricalengineering in 1929 from TokyoImperial University, now knownas the University of Tokyo. Helater earned a doctorate based onresearch he did at NEC.

After graduation he immediatelyjoined what was then known asNippon Electric Company andwas involved in designing andinstalling underground coaxialcable transmission systems. Oneof his first jobs was to install sucha system to connect Japan toManchuria, which Japanoccupied in the 1930’s.

He played a key role in restoringNEC to health after the companywent through a bleak periodduring World War II and itsimmediate aftermath. In thosedays, the story goes, Dr.Kobayashi carried the company’scash receipts in a bandana andwould leave by back exits andtravel by back roads to pay

employees before creditors couldseize the funds.

Displaying an independentstreak, Dr. Kobayashi pushed tofree NEC as much as possiblefrom the Sumitomo Group, thecollection of companies centredaround Sumitomo Bank

He understood a now widelyacknowledged truism about theelectronics industry. This is tothe effect that if companies wereto succeed in it, they had tospecialise in it to the exclusionof any diversions.

Not so well known, in the West,anyway, was his earlyidentification of anotherhallmark characteristic of thissector. He was among the first todiscover that in electronics andIT innovation, it is the challengeof the new that attracts andkeeps star performing personnel.

Thus, given the Japanese payrate subordination to that in theUS, he compensated bydeliberately arranging NEC’semployment structure so that itpresented constant freshopportunities to those thatthrived on them.

Until the end of his life, heconstantly remonstrated againstthe notion that financial rewardstriggered discovery. In contrast,he insisted, and this was at thepeak of the Japan Inc era, it wasthe opportunity to innovate thatwas the spur.

Similarly, he always modifiedthe West’s conception of thevaunted Japanese employment-for-life.

Nobody was ever forced to stay

at NEC, he insisted. They stayedthere because it remained thebest place to exercise theirtalents, and obtain recognitionfor them.

Another example of Kobayashi’sability to see around cornerswas to understand how a capitaltechnology-manufacturingsupplier such as NEC couldlever off the business-to-business market and intoconsumer products. Here again,he pointed out the trail forothers to follow

He personified too theconvergence of the scientist andwhat we would now describe asthe entrepreneur. Prior to WorldWar 11, Japan had pretty muchcopied US technology. Exceptfor some SCADA developments,Japan was a follower. Not aleader. There was though oneexception in which Japan had anearly application base, and thiswas microwave, which wasspecially suited to themountainous terrain of the Japanarchipelago.

It was this lead which NEC wasto build upon in the post waryears, and which was to provideit with the pre-eminence itenjoys now. Much of the earlytest-benching of its storedprogramme control, fullycomputerised switches was donein New Zealand via the TSSCjoint venture personallysanctioned by Dr Kobayashi

This development in turn addedgreatly to the baseload ofexpertise which was to prove soimportant when Telecom in NewZealand was itself globalised.



focus

Icona Solutions, Ltd., whichdevelops, supplies and supportsthe innovative perceived qualitysimulation and visualisationsoftware solution, aesthetica, hasappointed its first two value-addedresellers in China. Beijing-basedSili-Tech Co. Ltd. (www.sili-tech.com) and Shanghai-basedShanghai RPT AutomotiveEngineering Co. Ltd. (www.rpt-auto.com) will be responsible forselling and supporting aestheticain the rapidly growing domesticChinese automotive design andmanufacturing industry.

“The Chinese automotive industryis a key growth market for us,”stated Tim Illingworth, chiefexecutive, Icona Solutions. “With3.5 million cars sold in China inthe first three months of 2010 – a76% increase over the same threemonths last year – and 42%growth in 2009 over 2008 as awhole, forecasts indicate that salesof cars and light trucks will reachsome 25 million annually by2014, with an estimated totalownership of 130 million vehiclesby that time.”

“However,” he noted, “thedomestic Chinese automotivemanufacturers realise that in orderfor them to succeed in this rapidlygrowing marketplace, one of theirmajor tasks is to increase theperceived quality of their vehicles.That’s where we see majoropportunities for Icona Solutionsand aesthetica.”

Commenting on their appoint-ment, Jason Li, managing director,Sili-Tech, which is a CAEconsulting and systems integrationspecialist and Siemens PLMSoftware CAE solutions partner in

China, with customers in theautomotive, aerospace and shipbuilding industries, said, “We areproud that Icona Solutionsselected us to be their partner inChina and we are excited by theopportunities that exist in theChinese automotive industry for aunique software solution likeaesthetica.”

Meanwhile, Fang Ming, generalmanager, Shanghai RPTAutomotive Engineering, whichcounts Chinese automotivecompanies including SAIC, JAC,NAVECO, Chengfeng and GWamong its customers and is aleading reseller of DassaultSystémes’ full line of CAD/CAM/CAE and PLM software solutions,said, “Icona Solutions’ aestheticasoftware is an ideal complementto the mainstream vehicle designand engineering solutions that ourcustomers use on a day-to-daybasis, so we see majoropportunities in helping them toimprove the perceived quality oftheir vehicles through the use ofaesthetica.”

“Both Sili-Tech and RPT have thetechnical expertise and the marketknowledge that will enable

aesthetica to make its mark on theChinese automotive industry”,said Illingworth. “We are lookingforward to working with them intaking Icona Solutions to the nextlevel in the worldwide automotiveindustry.”

Icona Solutions’ aestheticasoftware provides an accurate,visual simulation of the effects ofcomponent variation, assemblyvariation and componentdeformation in manufacturedassemblies to enable full perceivedquality reviews using digitalmodels in order to resolve issuesof fit and finish quality. The use ofaesthetica gives greater insightthan has previously been possibleinto the impact of manufacturingvariation on perceived quality byenabling the user to visualise a‘virtual’ product at different stateswithin its geometric tolerancerange, in real-time, and preciselyas the customer will see the final,manufactured product. It helps toimprove perceived quality whilesaving time and improvingcommunication in the designprocess.

Icona Solutions Ltd. develops andprovides innovative and uniquesolutions to audit and improveperceived quality in manufacturedmetal and plastics products. Itssoftware can form an integral partof a product design andmanufacturing company’s overallproduct lifecycle management(PLM) software environment andis supplied and supported globallyboth directly and throughqualified, specialist resellers.Icona Solutions is a member ofboth Dassault Systèmes’ CAA V5Adopters and of Siemens PLMSoftware’s JT Open programs.

nextSTEP

Visit: www.iconasolutions.com

Icona Solutions addressesChinese automotive industryNew partners will help Chinese automotive manufacturers

increase the perceived quality of their vehicles throughthe use of Icona’s aesthetica software.

One of the Chinese producedsmall acrs



focus

DieselGas, specialising in dual fueltechnology, have developedelectronic conversion kits that allowvehicles to switch between usingdiesel and gas, while baggage-handling specialists Glidepathprovide design, manufacture andimplementation services – useful asThailand upscales airportinfrastructure.

Glidepath and DieselGas’srespective partnerships with Thaicompanies aren’t surprising givenThailand’s heavy concentration onautomobile manufacturing forexport in the ASEAN (Association ofSoutheast Asian Nations) market.The manufacture of electronicgoods is another huge area.

Other New Zealand companiesconsidering Thailand need onlylook to the country’s projectedcontinual growth for 2010. ForeignDirect Investment here increased toNZ$9.85 billion in the first half, andthis is set to accelerate in 2011.

From an economic standpoint,Thailand hit a 15-year high with 12percent growth in the first quarterfor 2010, while GDP growth for thesecond quarter was equally strongat nine percent year-on-year. In fact,Thailand’s first half of 2010 alonesaw its best two consecutivequarters of growth since 1995,despite political turmoil. Thoughdisruptive, the roads, ports and mostbusinesses remained unaffected andin September, the Thai financeministry raised its 2010 forecast forthe third time in six months. Thispresents further opportunities forNew Zealand manufacturers.

Like most of Asia, Thailand is alsolooking to reduce greenhouseemissions and is keen to identifylow-carbon projects that may beeligible for the Clean Technology

Fund, one of two ClimateInvestment Funds, which helpsdeveloping countries transform theirindustries to produce less carbonemissions.

DieselGas’s entry into the Thaimarket has been timed well. Withthe ability to help Thailand becomemore environmentally friendly andenable vehicle operators to enjoycapital cost pay-back in around sixto nine months, they are wellplaced here.

While Thailand presents a host ofmanufacturing prospects for NewZealand, it is essential to dobackground work. Companies keento follow the lead of Glidepath andDieselGas into Thailand must keepseveral considerations in mind.

Firstly, tendering for Governmentcontracts requires a Thai partnerand building a close relationshipwith this partner is key. The Thaiprivate sector is well disposed andoften experienced in internationaljoint ventures and partnerships.

It is worthwhile visiting regularlywhen negotiating with Thaicounterparts and having someonewho is familiar with the businessculture. While English is commonlyspoken at senior levels, bringingsomeone who is conversant in Thaiwill smooth the process and ensurethere are no misunderstandings.

Thailand has huge automotive,plastics and electronicsmanufacturing industries, and it isimportant to remember thatThailand has been working withforeign manufacturers for manyyears. Japan is the largest foreigninvestor in Thailand, primarily inthe manufacturing sector. Despitethis, do not assume that Thailandwill be familiar with the materials,

compounds and short-run processesused in New Zealand. It isimportant to research the localknowledge of the materials usedand be prepared to educate themarket, especially if your product orservice is more costly than in-market competitors.

The Global Competitiveness Report2010-2011 released by the WorldEconomic Forum ranks Thailand60th out of 139 countries evaluatedfor production processsophistication and 64th foravailability of the latesttechnologies. It rates 12th globallyfor strength of investor protection,even ahead of economies such asJapan, India, Indonesia, Australia,Italy and Sweden.

Most importantly, it is crucial toestablish how your product orservice fits into Thailand’s overallscheme of things – whether or not itwill satisfy certain needs orcapitalise on a trend in market be itchanging the face of cargo togreening the future.

Karlene Davis is New ZealandTrade and Enterprise’s TradeCommissioner for Thailand,Cambodia, Laos and Myanmar andis based in Bangkok, Thailand.

nextSTEP

Visit: www.nzte.govt.nz

Kiwi manufacturing influx into Thailand

By Karlene Davis, NewZealand Trade and Enterprise

Thai airports will soon experience a smoother, moreefficient flow of baggage and cargo handling, whilegreener vehicles will run on the country’s roads in the near

future, thanks to two Kiwi companies who have securedpartnerships in Thailand.



buiness news

The research reveals that over50% of HNWs in Hong Kong willlook for financial planning in thenext two years.

“High demands for financialplanning could be attributed tothe large proportion of 31-50years old HNWs in Hong Kongwho have long-term investmentobjective,” says Harry Senlitonga,senior analyst at Datamonitor.

However the biggest shift in assetallocation will be seen in thewithdrawal of funds from fixedincome. Indeed, more HNWs willleave fixed investments and cashor near-cash products by shiftingto equities and real estateinvestments due to an expectedhigher level of risk tolerance.

According to a report by theindependent business analystDatamonitor, this provides agreat growth opportunity forretail banks to derive revenuefrom customers through productbundling offers and incentivesthat will create a win-winsituation for financial serviceproviders and consumers.

“An average Singaporean holdsa huge number of financialproducts, especially on creditcards. Indeed, 80% of customers

accesses to product or servicediscounts on specific retailoutlets.

“Credit card exclusive discountsoffers have been proven as aneffective acquisition methodwith the side effect that manySingaporeans now have morecards in their wallet than before.As a result, the main financialinstitutions of these customersare missing out on the potentialto increase revenue percustomer” says Harry based inSydney.

Financial institutions shouldtherefore revisit their approachto consumers. Indeed,Datamonitor believes thatproduct bundling offers, whichhave been successful in manyother countries, will helpstrengthen MFI relationshipswith customers.

“A low product holding withinthe MFI shows cross-selling stilloffers plenty of growthopportunities for Singaporeanfinancial providers. Incentiveschemes aiming to encouragemultiple product uptakes withinthe same institution may createa win-win scenario for bothfinancial service providers andconsumers” concludes Harry.

“Equities and real estateinvestments are expected toincrease in popularity, alongwith the expectation forinvestors to return to considerriskier investment options byleaving conservative investmentoptions such as fixed incomeand cash or near-cash products,”adds Senlitonga, based inSydney.

Given the age profile of HNWs inHong Kong wealth managersshould focus more on providing awider range of services to cater fordifferent investment needs as intwo years from now, more thanhalf of HNWs will have a higherappetite for risk than they dotoday.

Future planning for HighNet Worth in Hong KongFinancial planning will be among the products and services that High

Net Worth (HNWs) in Hong Kong will most demand, according toresearch from independent business analyst Datamonitor.

Cross-selling provides agrowth opportunity for retail

banks in SingaporeDespite the average Singaporean holding many financial products,

only a few of these are with their main financial institution(MFI).

have at least one credit card and42% of them hold three ormore” comments HarrySenlitonga, senior analyst atDatamonitor.

Consumer demands and manyattractive offers from cardproviders, such as credit cardexclusive discount offers havecaused diverse credit cardproduct holding in Singapore. Asits name suggests, exclusivediscount offers providecardholders with exclusive

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It also has its share of critics andprotestors, all of who perceive suchan arrangement as going againstthe ethic of Net Neutrality. AndreasPouros, Chief Operating Officer atGreenlight, a UK-basedindependent search and socialmarketing agency, examines theextent to which it can be claimedthat what currently exists is truly inkeeping with the ethos of neutrality.According to Pouros, Google hastwo challenges, one of which islegislative, the other reputationaland the search industry is watching.

Net neutrality, or Internet/networkneutrality is the principle thatpeople simply shouldn’t mess withthe magic of the internet andshould take a hands-off approachwith its administration; morespecifically that governments andinternet service providers (ISPs)should not place any restrictions onthe internet’s content or means ofaccessing that content – two usersshould essentially have access tothe same content in the same way.

According to Google, “networkneutrality is the principle thatinternet users should be in controlof what content they view and whatapplications they use on theinternet. The internet has operatedaccording to this neutrality principlesince its earliest days...Fundamentally, net neutrality isabout equal access to the Internet.The broadband carriers should notbe permitted to use their marketpower to discriminate againstcompeting applications or content.Just as telephone companies are notpermitted to tell consumers whothey can call or what they can say,broadband carriers should not beallowed to use their market powerto control activity online.” (Guide toNet Neutrality for Google Users)

However, Google and Verizonhave put forward a proposal to theFederal CommunicationsCommission (FCC), to essentiallyretain this net neutrality on thepublic internet but to allowbroadband operators and networkoperators to offer new services thatmight be discriminate in terms oftheir price and speed. They areproposing that broadband providerscan allocate bandwidth for suchdiscriminatory projects, workingwith other application or serviceproviders as they see fit. Theymention a few specific examples tohelp illustrate their thinking,examples like health caremonitoring, advanced educationalservices, or new entertainment andgaming options. Essentially, theyare proposing they be permitted tocreate a two-tier system wherebynetwork capacity could be sold tocompanies willing to pay for thatservice to in turn provide a higherquality service to their opt-in users.

Whilst Verizon has said it has nointention of selling bandwidth fromthe ‘public’ network, it wants tomake certain it could providededicated bandwidth-basedservices to third parties if it wantedto. Verizon CEO, Ivan Seidenbergsaid:

“Verizon is standing tall. We saidwe agree that there should be nopaid prioritization of traffic over thepublic Internet. Google (and others)will continue to innovate, and wehave to feed that cookie monster.All we have asked is that we areallowed to offer services like Fios.”

Fios is a bundled homecommunications service Verizonoffers that makes use of an end-to-end fibre optics network, offeringinternet, telephone and television.Verizon cannot offer it over the

Internet, given neutralityrequirements, so it is offered as anetwork separate from the internet.

The proponents of net neutralityclearly don’t like this one little bit,as creating a two-tier system, evenif it means legislating neutrality inone of the tiers, results in thefragmentation that they fear andstill discriminates in their eyes.

Given that Google’s unofficialmotto is ‘Do no evil’, the backlashin some quarters has been brutal.On the ominous Friday the13August, internet users fromacross the Bay Area convergedoutside Google’s offices in protest.The rally was organized byColorofChange.org, Credo Action,MoveOn.org, Free Press and theProgressive Change CampaignCommittee.

SavetheInternet.com summarisedthe sentiment as follows:

“Google previously had been achampion of policies such as NetNeutrality — the fundamentalprinciple that keeps the Internetopen and free from discrimination.Its decision to team up withVerizon, long an opponent of suchpolicies, has drawn the ire of publicinterest advocates.”

So who are pro / against netneutrality legislation?

Many Internet giants areproponents of net neutrality, andalso supporters of the USgovernment’s involvement inregulating it to ensure the internetstays ‘open’. The likes of Amazon,Craigslist, Google (kind of),Facebook, Sony, IAC, and Twitterfall into this camp. PresidentObama himself does too:

“I am a strong supporter of netneutrality… What you’ve been

Net Neutrality: WhatNet Neutrality: WhatNet Neutrality: WhatNet Neutrality: WhatNet Neutrality: WhatSearch Engine Google and Verizon, a leading internet service provider and formerly one of the

AT&T Bell companies, are close to finalising a deal which would facilitate Verizon’s being ableto speed online content to internet users more quickly, if the content’s creators are willing to

pay for it. The idea that some sites, through paying a fee (or other) to Verizon, can gain priority andrun faster than others has backers.



focus

seeing is some lobbying that saysthat the servers and the variousportals through which you’regetting information over theinternet should be able to begatekeepers and to charge differentrates to different Web sites… Andthat I think destroys one of the bestthings about the Internet—which isthat there is this incredible equalitythere… Facebook, MySpace,Google might not have been startedif you had not had a level playingfield for whoever’s got the best ideaand I want to maintain that basicprincipal in how the internetfunctions. As president I am goingto make sure that that is theprinciple that my FCCcommissioners are applying as wemove forward.”

In the against net neutrality campare a number of large hardware andtelecommunications firms, whowould invariably benefit frombeing allowed to redefine the waythe Internet works as they controlthe means of accessing it. Inaddition, opponents also includeheavyweights such as Bob Kahn(inventor of TCP – “net neutrality isa slogan that would freezeinnovation in the core of theInternet”*) and David Farber(Professor - “The Internet needs amakeover”**). Robert Pepper,senior managing director of globaladvanced technology policybelieves all the pro-net neutralityhype, is just that, hype.

What does the Law say?

The law that affects net neutralitydiffers globally. In the US there isconsiderable debate around thetopic, with the FCC being involvedin trying to legislate around thisarea, and sometimes not by choice.For instance, a court case againstComcast was the first to seriouslytouch on this aspect, with Comcastwas accused of unlawfullythrottling BitTorrent traffic in a classaction suit. Comcast settled for$16m, with the FCC stating

Comcast needed to comply withtransparent network managementpractises.

In Europe, there has been a fairlycomplex process underway todecide whether to legislate in thisarea and to what degree. In 2006there were mixed conclusionsfrom a number debates. One,sponsored by AT&T, concludednet neutrality legislation wouldbe unattractive. Other debates atthe Royal Society and Institute ofPublic Policy Research, in thesame year, reached conclusionsthat were in favour of it.

In 2009, as part of the TelecomsPackage (to be implemented inMay 2011 by all EU memberstates), service providers were tobe held to a higher standard oftransparency, making itcompulsory for service providersto inform customers whether theservice they are subscribing toincludes any traffic managementtechniques and what the impactof those would be on servicequality or any other restrictions.AT&T put forward 5 revisions tothis, of which it successfullyachieved 2 of them. The tworevisions essentially leave thedoor open for discriminationagainst websites and users.

Are we truly net neutral todayand if so, how long can it besustained?

There are a number of centralarguments used in opposition toany kind of net neutralitylegislation. Firstly, that the abilityto charge users/sites differentrates for differing levels of accesswill provide the revenues to ISPsand other network operatorsnecessary for them to recouptheir investments in broadbandnetworks. Verizon has said thereis no current incentive for it todevelop and deploy advanced,super-fast fibre optic networks ifit can’t charge more for access to

such networks. Verizon and anumber of ISPs have often referredto firms like Google and Skype as‘freeloaders’ for making moneyusing networks that they haveprovided at a cost of billions.

Secondly, many suggest what wehave right now isn’t in fact netneutrality at all. The biggest firmscan invest in higher bandwidthdeals and server replication toprovide faster access for its users incomparison to smaller sites thatwouldn’t be able to afford suchinfrastructure, for net neutrality isn’teven something that exists touphold.

Thirdly, the increase in rich mediameans infrastructure providers havefar more pressures on theirresources than was once the case.Bret Swanson of the Wall StreetJournal suggests Youtube streams asmuch data in 3 months than theworld’s radio, cable and broadbandtelevision channels stream in oneyear, i.e. 75 petabytes. By extensionhe believes telecommunicationsfirms are simply not ready for theera of ‘exabyte’ delivery andsomething needs to give.

What next?

The ball is in the FCC’s court.Given the FFC is facing powerfuland influential pressure on bothsides, it won’t be able to pleaseeveryone. The next few weeks willbe very interesting as we see thedebate unfold in the commercial,political, and invariably in the pressworld. Of further interest to ussearch people is what impact itmay have on Google generally.Wired called Google a “netneutrality surrender monkey” thismonth, which means it has twochallenges, one of which islegislative and the otherreputational.

nextSTEP

Visit:http://www.greenlightsearch.com

’s all the fuss about?’s all the fuss about?’s all the fuss about?’s all the fuss about?’s all the fuss about?



products

It is expected to be the first of anumber of new models that willuse the Delcam software to createthe distinctive designs needed tobuild market share in the highlycompetitive and fashion-conscious mobile phone market.

Tribrid Modelling is Delcam’sunique, patented approach todesign that adds trianglemodelling to the solid and surfacemodelling options that areavailable in hybrid modellingsystems. It gives the ability to addtriangle files of logos, branding,textures or other 3D decorationsonto the surfaces of CAD models.This effect is rather like sliding atransfer over the surface ofan object, with the addedadvantages that thedecoration can be scaled orstretched to fit any givenarea, and that the result isfully three-dimensional.

Tribrid Modelling also allowsBoolean operations to becarried out between trianglemodels and either surfacesor solids. For many years,PowerSHAPE was one ofvery few CAD systems ableto perform Booleanoperations between solidsand surfaces. The ability toperform similar addition,subtraction and mergeoperations with triangles aswell makes the softwareeven more flexible.

LG Electronics has become aglobal leader through morethat 50 years of technical

innovation in consumerelectronics, mobilecommunications and homeappliances. The company, whichis based in the Korean capitalSeoul, employs more than 80,000people, working in over 115operations around the world. Lastyear, its global sales topped US$43 billion.

Staff from Delcam’s Korean jointventure, Hankook Delcam, hadtheir first contact with LG inAugust of last year. An initialpresentation on the potential forTribrid Modelling was followed bya longer meeting with a largegroup of designers from the

The LG Waffle phone is the first from the companyto be designed with Delcam software.

Tribrid Modelling produces“Waffle” phone first at LG

Korean manufacturing giant LG Electronics has recentlyintroduced its first mobile phone designed with Delcam’sTribrid Modelling software. The Waffle phone features a

surface texture created in the ArtCAM artistic CADCAMprogram, wrapped around the body of a phone design producedwith the PowerSHAPE CAD software.

company. Subsequently, HankookDelcam produced a series of rapidprototype models to furtherdemonstrate how the uniqueDelcam technology couldproduce sophisticated designsquickly and easily.

The presentations were soimpressive that LG decided topurchase the Delcam software inthe following month. This wasboth pleasing and surprising forHankook Delcam as mostpotential customers in Korea insiston a comprehensive evaluationperiod before making anypurchasing decisions. Apart fromthe design capabilities of theDelcam software, the staff at LGwere impressed with the full rangeof Delcam programs that couldcover the whole design andmanufacturing process for thephone cases. In particular, theywere pleased to see how quickly

the software could generatemachining data for toolingonce the product designswere completed.

Of course, thecomprehensive training andsupport available fromHankook Delcam were alsoan important part of thedecision. The value ofthese services was seen inthe speed with which LGwas able to introduce itsfirst design with the newsoftware. Following thisinitial success, HankookDelcam is nowapproaching other parts ofthe LG organisation toinvestigate furtheropportunities to introduceits software.

nextSTEP

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The fast revival of the Chinesemarket after the economic crisisand rapid growth of the Asianlarge-scale machine marketrelevant to Engel and the growingmarket share of Engel large-scalemachines have this year resultedin an extremely high utilisationrate of the Chinese facility.

Currently two large-scalemachines are being manufacturedweekly in Shanghai for delivery toAsian customers. By summer 2011the plant capacity in Shanghai isto be increased to 200 machines.This expansion is driven by theneed to satisfy in particular thegrowing demand for Engel duolarge-scale machines in South-EastAsia and India.

“Production in Shanghai is

meanwhile close to capacitylimits,” says Dr. Peter Neumann,CEO of Engel Holding. “Our goalis to manufacture two hundredlarge-scale machines annually inShanghai. The rapidly growingdemand for our Engel duomachines is encouraging becausewe are competing daily with Asianmanufacturers and in the past fewmonths were able to win over alarge number of new customerswith our Engel duo machines‘Made in China’.”

“Specifically, we are now planningto expand the Shanghai plant by9,000 qm to a total of 17,500 qm.This will double our productionarea. Besides doubling the floorspace, our plans include theoptimisation of existing processes.”

Engel capacities for the production of duo two platen injectionmoulding machines with between 350 and 5500 tonnes clampingforce are to be further augmented. Following the 6,000 qm

extension to the St Valentin plant to a total of 68,000 qm in June 2009,production capacities in Shanghai are now being expanded.

For example, a separate dispatcharea will be built to guaranteeefficient packaging and shipping ofthe large-scale machines. This willboost the efficiency of the finalassembly stations.

nextSTEPVisit; www.techspanonline.com

A duo two platen injectionmoulding machine

Production capacity for large-scale machines expanded



business news

Globally, access to the online channel has grown at a rapid pace, presenting huge opportunities forFinancial Services providers to access the global community. Data from the InternationalTelecommunications Union (ITU) show that 45% of the world’s internet users are currently from Asia or

Africa compared to 40% in North America and Europe combined. However Datamonitor’s Financial Services(FS) Consumer Insight survey reveals very different consumer appetites for FS products within these regions.

In terms of day-to-day managementof current accounts, consumers inthe Asia-Pacific region have keenlyadopted these online technologies.Registration levels for online currentaccounts are higher in Asia-Pacificoverall than in France, Spain orItaly. The situation in India is evenstarker – whilst having one of thelowest levels of internet penetrationas a country, over a third (37%) ofthose with a current account areregistered online for it.

One the whole, Asia-Pacificconsumers are far more engagedwith the online banking channelthan those in the rest of the world.They also perform a broader rangeof tasks, and are more inclined toseek a somewhat closer relationshipwith their bank through the onlineplatform - 26% of Asia-Pacificconsumers have used the onlinechannel to set up email or SMSalerts in the last six months,compared to only 10% in theEurozone and US, for example.

Mobile banking is expected to takethe same upwards trajectory asonline banking and is expected togrow faster, and has becomeespecially popular in some Asia-Pacific countries in providing basiccurrent account tasks for both theunbanked (e.g. in India) and moreremote consumers who may not beinternet users.

Security of online banking is aconcern for consumers in Asia-Pacific

However, there remains a significantproportion of internet users notregistered for their current accountonline. Security concerns are themain deterrent to consumers’ use ofthe online channel – and suchconcerns appear to be far higher in

Online Banking Channel morepopular in Asia-Pacific

AP. When asked why they don’tbank online, 75% and 61% inChina and Japan respectively sitedsecurity concerns as a factor (59%of Asia-Pacific consumers overall),in comparison to 39% of Eurozoneand US consumers.

Savings products a key growthopportunity in Asia-Pacific

The popularity of the online channelin Asia-Pacific is not restricted today-to-day banking activities.

Asia Pacific also holds a higher rateof online saving activity than anyother region in the world, taking thetop three spots in Datamonitor’srecent Financial Services ConsumerInsight survey. Japan shows thehighest level of online savingsactivity with rate of 72%, followedby China at 65% and Australia at57%. Singapore follows closely infifth place on 50%. These rates aresignificantly higher than many otherWestern regions, including the US at45%, Germany at 39% and Italy at13%.

This shows that there is still a lot ofroom for growth through growinginternet access in regions such asChina, or by focusing on reachingthose not yet saving online inAustralia and Singapore.

Online savers tend to be affluentand prepared to make their ownfinancial decisions, making them ahighly profitable market for financialservice providers to target.

Online borrowing levels restrictedby cultural forces

Online borrowing products providean interesting and surprisingopportunity for lenders in theregion. Overall, despite anunwillingness to borrow amongst

some consumers in the regiononline appetites are high. Overallconsumers in Japan are the mostconservative in the world when itcomes to borrowing: 5% currentlyhave a loan, compared to 28% onaverage worldwide and 23% acrossAsia Pacific as a whole. In completecontrast, 34% of Chinese onlineconsumers are borrowing atpresent.

Australia and Singapore both liewithin these extremes, on 19% and24% respectively. Despite this,attitudes towards online uptake inthis area of personal finance yieldsurprising results. Japaneseconsumers are highly averse toborrowing, but when they decide toborrow, they are very happy toapply online. Consumers inAustralia, too, are relatively willingto take out loans online should theyfeel the need to borrow.

However in Singapore, a very lowproportion of borrowers haveproved willing to exploit the onlinechannel, instead preferring to usemore traditional channel methodsthat involve at least some degree ofpersonal contact.

The future lies in personalising theonline experience

The rise in Web 2.0 technology andinteractive communication hasallowed banks to provide a far moreeffective 2-way interface forconsumers. In doing so, banks havesucceeded in shifting preferencesand quelling some consumers’concerns. Use of social media in theFS industry is fast gaining paceparticularly in Asia-Pacific, andbanks such as UBank in Australiahave pioneered its use as a keycustomer retention tool, customerservice and feedback platform.



business news

China attractive at presentIn a comprehensive review of the wealth management markets across

the leading Asia-Pacific countries China is rated as having the mostattractive market for international players at the present time.

Singapore most tax-friendlyfor entrepreneurs

A comparison of the taxes burden faced by start-ups in sixeconomies reveals significant variation with Singapore coming out

as the most tax-friendly jurisdiction.

China is the smart choice forinternational private banks, due toits burgeoning wealth levels andlow service levels. While themacro business environment inChina is still difficult for foreignplayers, there is a vast and everexpanding pot of wealth in thecountry which currently is notparticularly well serviced.

The market challenges in Chinashould not, however, beunderestimated, with real issuesaround market entry, availabilityof talented personnel and theattraction of HNWs in the country.

The attractiveness of the wealthmanagement markets in Australia,Hong Kong, Singapore, India andChina were evaluated using theproprietary Wealth ManagementOpportunity Index. This market-

leading index scores the overallattractiveness of country marketsas well as their customer andcompetitor features, all from thepoint of view of internationalprivate banks.

Australia is rated as being thesecond most attractive market forinternational players because itoffers many of the comforts ofhome to Western players: a welldeveloped economy, an attractivebusiness environment andsignificant numbers ofsophisticated high net worthindividuals (HNWs). However, forall of its obvious appeal, highlevels of competition and certainHNW characteristics makeAustralia’s wealth managementmarket a dangerous one forinternational players, explaining

why so many of the internationalprivate banks have chosen to giveit a wide berth

Perhaps controversially, India placesthird in the rankings. It is let downby key macro and institutionalvariables and by the fact that itspool of wealth is still relatively smalland concentrated compared to othercountries in APAC.

On the plus side, India has anumber of wealth managementmarket features which are veryattractive to international players:it does not have prohibitiveregulatory obstacles, the market isfragmented, the investmentinfrastructure is well establishedand the nature of HNWs isfavorable to international privatebanks. Indeed, the significantlevels of activity by internationalplayers in the market and theirevident success testify to its meritsthe report concluded.

GuideMeSingapore.com releaseda report that compares the taxpolicies of six countries: UK,USA, India, Australia, Russia, andSingapore. Using the tax rates forthe year 2009, the report performsa comparative analysis of the taximpact on a new firmincorporated in each of thesecountries.

Among the six countries consid-ered, the report finds that the taxburden imposed on new firms isthe smallest in Singapore while itis the highest in India. Ifmaximisation of take-home profitswere the main objective, for anentrepreneur who has theflexibility to incorporate his or herbusiness in any of thesejurisdictions, Singapore offers the

most rational choice — the reportconcludes.

To illustrate its findings, the reportconsiders the case of a hypotheticalstart-up firm that expects to makean annual income of US$300k.Such a firm will have a total tax billof only US$34k in Singapore whileit would face an approximate taxbill of US$60k in Russia, US$63k inUK, US$90k in Australia, US$100kin US, and US$102k in India.

The authors of the study cautionthat each country’s tax policiesdiffer from those of the others inthe exemptions, incentives, anddepreciation allowances that theypermit. The major exemptionsavailable to companies have beenconsidered in this analysis but their

esoteric nuances have been ignored.

Jacqueline Low, the Director ofCorporate Services at JanusCorporate Solutions — a leadingSingapore corporate services firmthat runs theGuideMeSingapore.com site —further emphasised the long-termattractiveness of the Singapore taxpolicies by adding, “The historicaltrend of corporate tax rates inSingapore over the last 5 yearsshows consistent reduction. Pergovernment’s stated policies, thistrend is likely to continue inSingapore whereas in most othercountries this trend is pointingupwards due to the rising budgetdeficits that these governmentsface.”

nextSTEPVisit:www.guidemesingapore.com



profile

Most vessels hijacked by themodern pirates in the busyshipping lanes off the coast ofSomalia have to be “reclaimed”by their owners for an average oftwo million US dollars each.

In an attempt to prevent that, animaginative private security

company in the UK has developeda new product that it believes canhalt or hamper today’s pirates whouse small fast boats to board thelarge vulnerable and slow-movingvessels.

The novel defence system consistsof a simple but strong net that canbe draped over the stern or sidesof a possible target vessel -creating a safety zone - andfloated clearly on the surface forsome distance to prevent thepirates getting their speed-boatsclose to the big ships they seek tocapture.

In the years of anarchy thatSomalia has suffered since itsgovernment was overthrown in

1991, thousands of pirates nowoperate off its coast. Somalia’s3,000-kilometre coastline - thelongest in Africa - has become oneof the world’s most dangerouswaterways. No ship is safe. Pirateshave hijacked aid shipments,kidnapped crews, and have evenfired rocket-propelled grenades atcruise ships.

The idea for the naval safety netcame to Nick Davies, founder ofthe Anti-Piracy Maritime SecuritySolutions company - based inPoole, south-west England - afterhe noted the way in whichpowerboat propellers can bebadly fouled by fishing nets.

He said: “In essence it [the anti-pirate system] is a fishing net thatis deployed, then it floats on thewater all around the ship andsnags the propellers of any boatscoming near it.” Sounds basic but

Are your products getDespite the best efforts of an international naval police

force patrolling the Gulf of Aden and nearby seas, gangsof ruthless criminals can still capture highly valuable

cargo ships and hold them to ransom.

Below: Hooking the pirates: inattempts to prevent hijackerscapturing valuable cargo ships onthe high seas, a security companyhas developed a trailing net systemthat it believes can stop or hampertoday’s pirates who use fast boatsto board vulnerable slow-movingships such as tankers.

Image by Anti-Piracy Maritime SecurityServices



profile

tting to their market?By Richard Mainoeffective? – “Yes, some times the

easiest things are the things thatdo work.”

Davies believes the counter-piracydevice will turn the tables on thehigh-seas criminals because anyship with the trailing nets is notgoing to be a target they wouldwant to get close to for fear ofending up with a disabled boat.

The nets can be fitted to anyvessel from the bow to a line levelwith the stern gear down the sideswith six-metre steel boomsholding the net away from thevessel. The stern net attachesacross the full width of the sternand trails for 50 metres behind thevessel.

When not in use they can besafely stored on deck in their owncontainers. They can be deployedand recovered in fewer than 20minutes. All the nets are fittedwith orange warning buoys to actas a visual deterrent and to warnof danger.

Anti Piracy Maritime SecuritySolutions (APMSS) of Poole,Dorset, England, is a UK companyestablished in 2008. Its director isNick Davies, a former army pilot.The company says its goal is toprovide for the safety and securityof merchant ships as they makepassage through the MaritimeSecurity Patrol Area in the Gulf ofAden.

The APMSS team members haveprior experience in a variety offields, including UK SpecialForces (Special Boat Service, anti-terrorist units), navy, army andpolice. Its interim deck-watchteam provides non-lethal shipsecurity through known high-riskpiracy areas, using necessaryequipment, including long-rangeacoustic device. APMSS providesearly warning of a potential pirateattack.

More than 90 ships were attackedoff the coast of Somalia in 2008and many vessels - and crews -

still remain in the hands of Somalipirates who are prepared to waitfor months or longer whilenegotiating their ransom demands.

Tankers are an obvious target ofopportunity, with an averagecargo of 110 million dollars’ worthof crude oil. They are run with asmall crew and a fully ladentanker is relatively easy to get onboard from smaller fast boats,often sent out from a mother shippatrolling the seas to find victims.Experts estimate that the piratesand the warlords who run themhave “earned” some 30 milliondollars in ransom money in 2008.

Currently, the Nato alliance, theUS Navy’s Fifth Fleet, and a hostof other countries have shipspatrolling the coast of Somaliaand the Gulf of Aden - an area ofabout 2.84 million squarekilometres (about 1.1 million sqmiles) - to prevent piracy.

SINGAPORE High net worth (HNWs) in Singaporeare anticipated to have a somewhat higher appetitefor risk in two years compared to today, accordingthe latest research from independent market analystDatamonitor.

The research reveals that within two years inSingapore, fixed income will see the biggestreallocation among HNWs’ portfolios.

Indeed, more HNWs in Singapore will leave fixedinvestments and cash/near-cash products, shifting toequities and alternative investments due to a higherlevel of risk tolerance.

The change of investors’ conservative mindsets dueto the recent global economic crisis is one of thefactors causing this shift in asset allocation amongHNWs’ portfolios. HNWs in Singapore will focusmore on equities and alternative investments, and

move away from cash and near-cash products andfixed income.

However, one of the main challenges for manywealth managers in Singapore is to convince HNWsto invest in riskier products. Without a doubt, therecent global crisis has made HNWs more cautious inmaking investment decisions.

The research also explains that an evidence of duediligence on the part of clients into recommendedproducts is among the most successful means ofgetting HNWs in Singapore back into riskier products.

In the next two years, wealth managers will have toaddress this issue in anticipation of HNWs demandsin moving to riskier products. Wealth managers needto provide not just some assurances through evidenceof due diligence, but also evidence of returns fromhigher risk products.

Appetite for risk increases forAppetite for risk increases forAppetite for risk increases forAppetite for risk increases forAppetite for risk increases forwealthy individuals in Singaporewealthy individuals in Singaporewealthy individuals in Singaporewealthy individuals in Singaporewealthy individuals in Singapore



calendar

TRADE SHOWSFebruary 2011Australasian Oil and Gas Exhibition,23-25 February Perth Convention Exhibition Centre, Perth, Australia

March 2011Asia Pacific Sourcing 9-11 March, Koelnmesse Cologne

Central Districts Field Days 11-19 March, Manfeild Park, Feilding, Wanganui

interzum guangzhou 2011 27-30 March, China Import and Export Fair Pazhou Complex, Guangzhou�

Macao Int�l Environmental Co-operation Forum & Exhibition 2011, 31 March, The Venetian Macao-Resort-Hotel�

April 2011Macao Int�l Environmental Co-operation Forum & Exhibition 2011, 1-2 April,The Venetian®Macao-Resort-Hotel�

5th Metals Industry Conference, 14th-15th April 2011, Wellington

May 2011SouthMach 11-12 May CBS Canterbury Arena, Christchurch(Asia Manufacturing News will be previewing SouthMach in April issue)

Australian International Engineering Exhibition (AIEE) 24-27 May, Melbourne Convention and Exhibition Centre.

CHINAPLAS 2011 � The 25th International Exhibition on Plastics and Rubber Industries 17-20 May, ChinaImport & Export Fair Pazhou Complex (Area A & Area B), Guangzhou, PR China

June 2011BuildNZ 26-28 June ASB Showgrounds, Auckland

Designex-Auckland 26-28 June, ASB Showgrounds, Auckland. July 2011

July 2011Speedshow 23-24 July, ASB Showgrounds, Auckland

September 2011Rugby World Cup, New Zealand



logistics

PenangPort has ongoingmaintenance arrangements withthe global Konecranes Group toservice its ship-to-shore cranes asit invests RM 1.10 billion ($US340million) from 2007-2012 toexpand elevate its status to amain line port capable of handlingmore than a million TEUs (Twentyfoot Equivalent Units) a year.

The nine existing ship-to-shorecranes – with three electricoverhead travelling (EOT)maintenance cranes for whichKonecranes is also responsible atNorth Butterworth ContainerTerminal – are integral to theport’s performance as it aims toultimately achieve craneproductivity of 30 TEUs an hour.

Another seven ship-to-shorecranes are scheduled for deliveryby the end of this year, withservice and parts supply alsoprovided by Konecranes throughits nearby Singapore headquartersand worldwide network of 485locations in 43 countries withmore than 366,000 cranes of allbrands under service contracts.

The current NBCT expansionPhase 3 consists of Segment A1and A2. Segment A1 involved theextension of a new 600 metreberth at the Northern end of theexisting 900 metre wharf. SegmentA2 involved the construction of a771 metre length of stacking areafor export containers behind thewharf. The stacking area iscapable of handling 465,000 TEUswith 2640 ground slots. The totalinvestment of this project inclusiveof the handling equipment is aboutRM900 million.

“We are a 24/7,365 days a year

operation, so prompt and reliableservice of cranes of all brands isvery important to us,” saysPenangPort Senior MaintenanceEngineer, Engineering Services –SBU Container Services,Muhammad Asri Bin Md Isa.

“It is definitely very important thatwe have no interruptions, andreliability will be increasinglyimportant also as we expand ourcurrent fleet of STS cranes overthe coming year.

“This is one of the reasons whywe appreciate the global expertiseof the Konecranes organisation,which can source parts promptlyand advise on a wide variety oftechnical issues that it is familiarwith worldwide. And weappreciate too the expertise of thelocal Konecranes people whounderstand our operations,” saidMr Asri, who is assisted byKonecranes Sales Engineer,Maintenance Services, Malaysia,Puah Boon Kheng.

Mr Boon Kheng, whose office inPenang is backed by the resourcesof the regional Konecranesheadquarters in Singapore, isresponsible for the maintenanceagreement covering the 10-ton

Konecranes XL EOT crane, andthe 8-ton CXT and 3-ton XLcranes in the maintenance facility.He also provides assistance for theship-to-shore cranes, working withthe port’s own maintenanceteams, and for the mobile RTGcranes that move containersaround the port’s yards.Konecranes is involved inrepairing and upgrading the gantrycranes, as well as the quay cranesserving customers globally as wellas those in Malaysia, Thailand andIndonesia.

Recent jobs in which they havebeen involved include a trolleyrail and wheels replacement onSTS Crane No 4, completedwithin three weeks, andrebuilding of the bogie on an RTGcrane to repair the expected wearand cracking resulting from heavyservice in the container yard.

Mr Boon Kheng says such jobsillustrate the time-saving ongoingpartnership with PenangPorts’ ownstaff, who draw on Konecranesservices to enhance reliability,safety and efficiency by obtainingparts and service promptly and atcompetitive pricing.

Mr Asri says PenangPort can getparts promptly from Konecraneslocal Penang office, or in a weekor two from Singapore –“Whenever we need someassistance, Konecranes is ready toassist. The price is reasonable –they come to us with a package –and, being an internationalcompany, it is very helpful insourcing spare parts.

“Dealing with an OEM and worldrecognised crane serviceorganisation is very helpful,particularly when dealing with theDepartment of Safety, for example.Our relationship makes it easier toattain regular safety certification,

Penang Port’s main line visionshared by Konecranes groupAs the port of Penang undertakes the biggest expansion in

its history it is employing worlds best practices to ensurethe reliability and efficiency of the craneage system on

which its cargo handling depends.

Continues page 31

The ship-to-shore cranesoperatinmg at PenangPort



news

The country, which has thesecond largest economy in South-East Asia after Indonesia, plans toincrease total generating capacityfrom about 30,000 MW in 2009to more than 50,000MW by 2021.* (Electricity Generating Authorityof Thailand, EGAT)

Of this total, well over a third willcontinue to be provided byIndependent Power Producers(IPPs), private investment vehiclesthat work with the ElectricityGenerating Authority of Thailand,EGAT, to provide the infrastructurecapital needed to build newinfrastructure and ensure thatexisting assets are operated atpeak efficiency and optimumsafety.

The global Konecranes group hasbecome a long-term partner in thisprocess with the Southern ThaiKEGCO subsidiary of TheElectricity Generating PublicCompany, EGCO, which is thefirst independent power producerin Thailand . This public companythat owns and developsgeneration units which coverdiversified fuels such as naturalgas, coal, diesel oil, hydropowerand biomass, in accordance withthe government’s policy on fueldiversification to ensure energysustainability.

One of EGCO’s earliestacquisitions, through KEGCO, isthe 824 MW Khanom powerplant, a major base load generatorin the Nakhon Sri Thammaratprovince in Southern Thailand,where it operates a combined gascycle turbine (674MW) and twobarge-mounted thermal plants(150 MW).

As the first generating station inAsia to achieve IS09002 qualitycertification – and as a winner thisyear of its seventh consecutive EIAenvironmental monitoring awards– Khanom has set out to be amodel of safety and efficiency. Ithas adopted ISO 14001 and TIS18001 OHSAS 18001: 1999 in itsoperating standards. KEGCO hasalso been awarded NationalSafety Awards for eightconsecutive years.

“We are now introducing TotalQuality Management systems in aprogramme extending over thecoming three years,” says KhanomElectricity Generating CompanyElectrical Maintenance SectionManager, Suebsak Choorit.

“As part of our drive to achieveglobal standards of excellence ineverything we do, we activelyseek to focus people to improveeverything we do. We want tohave a continuous process ofreviewing how we did thingsbefore, and seeing what can bedeveloped to improve theprocess,” said Mr Choorit, whoworks with Konecranes ThailandBranch Supervisor SommartChockseareesuwan to ensureworld-best practices are adoptedfor the company’s liftingequipment.

Konecranes has been involved formore than 10 years in achievingoutstanding reliability levels fromthe 39 cranes at Khanom. Thisyear Konecranes Thailand Branch,under the direction of ServiceBranch Manager JirapongKocharack, signed another three-year preventive maintenancecontract for the vital equipment,

ranging in size from overheadcranes up to 65 tons, down torotary and jib cranes, HRSGcranes (heat recovery steamgenerator), gantry cranes,workshop cranes, electricoverhead cranes and chain hoistsand chain blocks.

When involved in an ongoingbasis in assisting with safetytraining and preventivemaintenance, Konecranes uses thecustomer knowledge andexpertise of its Thai team todeliver locally the globalresources of the Konecranesgroup. The group employs nearly9,700 people at more than 485locations in 43 countries and hasmore than 366,000 cranes of allbrands under service contracts.

“This type of support is vital,because we depend on the cranesfor everything from routinemaintenance to the removal of therotors and turbines of our four gasturbines and three steam turbines.We take out turbines every fouryears in a rolling programme, so itthis process is going on much ofthe time and obviously we needcomplete safety and reliability toachieve maximum efficiency,”said Mr Suebsak.

“This is specialised work and youhave to know your suppliers verywell. I am very confident withSommart that if I call him in anemergency he will be on-site veryquickly and know immediatelywhere to go to find and fix things.

“Even with routine work, a globalcompany such as Konecranes cansource parts and technology morequickly than the old ways. Wehave many brands of Japanese andEuropean cranes on-site, inaddition to our Konecranesequipment for heavy lifting. Theyknow what parts we need to haveon-site, what’s likely to be needed.

Power lifting partnershipprovides energy generators

As one of the powerhouses of Asia-Pacific economicgrowth, Thailand invests heavily in electricity generatingcapacity to service its burgeoning major industries,

including automotive and electrical manufacturing and tourism.



news“If a crane ever did break down,they would fix it quickly, becausethey know where to look, whereto get parts and how to get backinto production quickly.

“If change your service peopleoften, you have to start all overagain with them, which is not thecase with Konecranes.

“And the safety and efficiencybenefits are not only in ourroutine contract – we can rely onKonecranes expertise nationallyand internationally when they doload testing and safety testing ofthe cranes.”

All inspections are based onKonecranes ServMan craneinspection and service computerprogramme, with local rulesintegrated (for the Kor Por 1Inspection). The inspection inperformed by qualified andcertified inspectors with aninspection report is given to thecustomer within a week of theinspection, including:• The working condition of the

cranes.• The safety condition of the

cranes.• Any actions needed to improve

the cranes’ safety.• Any actions needed to improve

operator and productionhazards.

• Safety Certificate (Kor Por 1)signed by a 2nd Degree ThaiMechanical Engineer.

The inspections are performedfour times a year, or once everythree months, as required by theInterior Ministry of Thailand foroverhead crane inspectionsinvolving the Safety Certificate(Kor Por 1).

Konecranes also upgrades existingequipment to new efficiencylevels, including Khanom’s largest,65-ton, double girder Konecrane,which is used in the turbinerefurbishment programme. Thiswas brought up to KonecranesCXT standard, with twin motorsand twin motor brakes for

enhanced safety and operatingdurability when dealing with veryheavy equipment. CXT Featuresinclude –☛ High performance hoisting

motors with 60 per cent EDrating, which combine extrapower with superior coolingcharacteristics. The hoistingmotors also have the powerand flexibility for temporarypeak usage situations. Motorsfeature overload limingdevices, disk brakes, andthermal protection.

☛ Inverter control as standard incrane and trolley travels, foreasy and effective load control.Smooth starts and stops reducewear and mechanical stress onstructures and minimises theload sway. Improvedproductivity is achievedbecause moving andpositioning the load is faster,easier and safer.

☛ Fast and accurate loadpositioning with True Lift asstandard, which means thehook moves horizontally only5mm during a one-metre lift.

☛ Ergonomic hook design, whichmakes rigging of the load safer,while the rope drum to ropediameter ratio is more thandouble conventional designs.The innovative design of CXThoists, with a large rope drum

diameter, reduces the stressand wear of the lifting rope.

☛ Special features for Khanomincluding two-step limit switchon the trolley travel (Slow-Stop) and two motors drivewith separated gearbox andoverspeed mechanical brake.

Mr Subesak says KEGCO valuessafety, reliability and efficiency inall lifting operations “So we relyon Konecranes global knowledge,coupled with local expertise, toprovide top standards ofpreventive maintenance. And it isgood that Konecranes can help uswith safety inspections, becausethis is an important and time-consuming job.”

“We get good support all year,with teams of three Konecranespeople out for routine inspectionsand four involved in the annualinspections. They all fit in withour own people very well – weknow them very well and we’rehappy with that and with the craneavailability and reliability rates wehave achieved working together.”

Konecranes is a world-leadingprovider of lifting andmaintenance solutions, with atrack record in pioneering, leadingand shaping developments in theindustry. Annual sales in 2008exceeded 2.1billion Euros.

nextSTEPVisit: www.konecranes.com.sg

A 65 tonne overhead crane



news

As part of the root server launch inPhnom Penh, MekongNet andAPNIC conducted a DNS andDNSSEC (DNS Security) workshopfor interested communitymembers. Mr ChampikaWijayatunga, APNIC TrainingManager said the workshopintroduced the benefits of the newroot server to the Cambodiancommunity.

“We would like to give theCambodian community theopportunity to learn about thebenefits of having a root server inCambodia as well as bestpractices in DNS infrastructuremanagement,” Mr. Wijayatungasaid.

Since 2007, APNIC andMekongNet have collaborated toprovide APNIC Training courses tothe Cambodian Internetcommunity.

Speaking at the launch, Mr.Wijayatunga explained thedynamics of root servers as well astheir strategic benefits, saying,“Launching the first root server inCambodia will bring significantimprovements in both speed andreliability to Internet users inCambodia. This is especially so interms of faster domain resolutionand increased resilience, whichmeans an overall increase in thespeed and reliability of Internetaccess for users.”

APNIC Director General PaulWilson added: “The deploymentof this root server in Cambodia isa positive example of the wayrapid development of the Internet

in the Asia Pacific is beingsupported through collaborativework between APNIC as theRegional Internet Registry andmembers of the Asia PacificInternet community.

“APNIC aims to support thesedeveloping economies by meetingthe increasing demands fortraining and other services,” MrWilson said.

Root servers are a critical part ofthe Internet’s DNS, providinginformation about authoritativeservers for Top Level Domains(TLDs). Computers need thisinformation to support many typesof Internet activities, likeinterpreting URLs and emailaddresses.

As one of five Regional InternetRegistries (RIRs) in the world, theAsia Pacific Network InformationCentre (APNIC) is a not-for-profit,membership-based organizationcharged with ensuring the fairdistribution of IP addresses andthe related numeric resources inthe Asia Pacific region.Responsiblemanagement ofthese resources isvital for the stableand reliableoperation of theInternet.

Internet SystemsConsortium, Inc.(ISC) is a non-profitpublic benefitcorporationdedicated tosupporting the

infrastructure of the universalconnected self-organizingInternet—and the autonomy of itsparticipants—by developing andmaintaining core productionquality software, protocols, andoperations.

Since 1994, ISC has operated F-Root (one of the 13 root DNSservers) as a public service to theInternet.

“MekongNet” is a registeredtrademark under Angkor DataCommunication Group Co., Ltd,established in 2005. It is a fully-fledged Internet Service Provider,with a license for the provision ofInternet Service Provider (ISP) andInternet Exchange Provider (IXP)granted by the Ministry of Postand Telecommunications ofCambodia. “MekongNet” hasinvested heavily in developing theCambodian telecom industry,including more than two yearsspent delivering the latest, high-quality technology at exceptionalvalue. Recognized as a seriousand aggressive technology playerwith the ability to provide a widerange of 24/7 high-speed Wirelessand Optical Fiber last-miletechnology Internet access optionsto residential and corporatecustomers.

nextSTEPVisit: www.apnic.net

Cambodian Root Server toSpeed Internet Access

MekongNet, Cambodia’s largest Internet ServiceProvider, in partnership with the Asia Pacific NetworkInformation Centre (APNIC) and the Internet Systems

Consortium, launched an f-root server in August 2010.Thenation’s first root server, deployed in Phnom Penh, has beenoperational since July. There are a total of 13 root servers in theworld and the f-root server has 49 instances around the globe.

Temple at Prey Kongreach, Combodia



news

Latin America needs to diversify itsexports - away from oil, iron, soya,meat and the like - if it is to growsustainably. Unfortunately, as theregion has focused on selling itscommodities to China, Chinesefirms have been outcompeting LatinAmerican manufacturing exportersat a frightening pace.

In the 1980s and 1990s, LatinAmerica looked to the US as a coreeconomic partner, adopting theWashington Consensus in order toattract US investment and gainbetter access to US markets. Alas, inthe twenty years up to 2002, LatinAmerica grew by barely one percent a year in per capita terms.

Enter China. It has served as a newand more dynamic destination forLatin American produce: buying$44bn worth of the region’s exportsin 2009, ten times more than in2000. In addition, Chinese demandfor those exports - 80 per cent ofwhich are primary commodities -played a key role in driving upglobal prices. Thus China hashelped boost economic growth inLatin America.

However, Latin America has lostsight of the need for exportdiversification. In our new book,The Dragon in the Room,Uruguayan political economistRoberto Porzecanski and I calculatethe extent to which Chinesecompanies are outcompeting theirLatin American counterparts.

We draw on the methods of theAsian Development Bank toexamine data for thousands ofsectors and sub-sectors. A LatinAmerican manufacturing exportsector is classified as “under threat”from China, if China’s market shareis increasing while a Latin Americancounterpart’s share is decreasing. A

“partial threat” occurs when LatinAmerican exporters are penetratingglobal markets, but their Chinesecounterparts are doing so at a muchfaster rate.

Our analysis finds that 92 per centof Latin America’s manufacturingexports were under threat fromChina by 2009, representing 39 percent of Latin America’s total exports.

Brazil is heavily exposed. Eighty-four percent of its manufacturingexports are under threat,representing 28 per cent of its totalexports. Forty-three percent ofBrazil’s manufacturing exports go toother Latin American countries,serving as a key anchor market forBrazilian companies. Yet 65 percent of those markets are underthreat from China. As this chartshows, Brazil may already befeeling the effects.

Mexico is also in a grave situation. Ithas the most similar export basket toChina and, like China, relies on theUS as its source of (export) growth.Ninety-seven per cent of Mexico’smanufacturing exports are underthreat from China, representing 71per cent of all Mexicanmanufacturing.

Only in car and truck productiondoes Mexico “threaten” China in theUS market. This is largely due to thefact that cars and trucks are heavy totransport and Mexico enjoys alocational advantage over China.Moreover, NAFTA includes a local-content standard requiring that acertain percentage of cars in NorthAmerica be manufactured there.

As recently as 2001, China andCentral America were on a par, eachselling about $6.5bn worth ofapparel to the United States andeach holding a 12 per cent share of

the American apparel market. In2005 the Central American FreeTrade Agreement (CAFTA) tookeffect. By lowering tariffs andlocking in access to the USeconomy, CAFTA was supposed tosolidify Central America as aclothing hub.

Instead, clothing exports fromCentral America to the US plunged25 per cent from pre-CAFTA days to$5.6bn in 2009. Central America’sshare of American apparel importshas slipped to 8.7 per cent, whileChina now enjoys a commanding38-per-cent share.

Latin America would do well tolearn from China. Unlike its LatinAmerican counterparts, the Chinesestate has been actively enablingChinese firms to expand theirtechnological capabilities and goglobal. For example, Huawei, theChinese telecom giant, received$10bn of credit from the ChineseDevelopment Bank.

So far only Brazil is beginning tothink along these lines. It is thesingle Latin American nation thatspends more than one per cent ofGDP on research and development(as China does) and has an activegovernment policy focused onindustrial competitiveness. Brazilalso bargains hard with China,awarding China an iron mine oncondition it also builds a steel plant.The Brazilian development bankrecently set up offices abroad toassist Brazilian exporters. More LatinAmericans should follow that lead.

© The financial Times Ltd 2010

Kevin P. Gallagher is an associateprofessor of international relations atBoston University and a seniorresearcher at the Global Developmentand Environment Institute at TuftsUniversity. With Roberto Porzecanskihe is co-author of The Dragon in theRoom: China and the Future of LatinAmerican Industrialization (StanfordUniversity Press, 2010).

Latin America must see China as atrade threat, as well as a partner

Financial Times, By Kevin P.GallagherMajor Chinese investment in Latin America is now a regular

event: Sinopec’s $7.1bn investment in Repsol’s Brazilian unitis just the latest example. Such deals are rightly celebrated

with fanfare in Latin America. However, the long-run effects areuncertain - especially given that Latin American exports are losing badlyto their Chinese counterparts in world markets.



focus

The bustling city of 3.5 million hasseen container volumes treble tomore than a million containers ayear over the past decade as theemerging economies of Asia -including neighbouring giant India -power their way into the 21stcentury.

Developments such as the AsianHighway - an international networkof 141,000 km of standard highwayscrisscrossing Asian countries - areexpected to further expand regionalcooperation among the mainlandcountries of Asia and to furtherstimulate development inChittagong, a trading centre whichdates from at least the fourth centuryB.C. when Malayan historychronicles the journey of the sailorBuddha Gupta from Chittagong toMalaya. It has evolved from ancienttimes as a major Arabian port, thenPortugal’s Porte Grande and later asa strategic site of allied operationsduring the Second World War.

Trade is forever the city’s lifeblood,with most of Bangladesh’s exportand imports counted among the 30-plus million tons of cargo handledannually at the rapidly modernisingport, where a window berthingsystem was introduced in 2007 tofacilitate accurate arrival anddeparture times for ship operators.

“We can see container volumeseasily trebling again in thenext five years, reachingtwo,three or four millioncontainers or more” saidlocal business leader andformer Chittagong PortsAuthority senior engineerMr Zahirul Hoq.

“Bangladesh’s own nationalexport growth is sufficient todouble or treble exports byitself over the coming

decade, even allowing for theeconomic slowdown having itsmajor effect in developing countrieslater this year and early 2010. Thenthere is the positive impact of theAsian highway, on which goodpolitical and physical progress isnow being made - and theopportunities opening up withIndia’s seven “sister” states aroundBangladesh seeking an outlet fortheir wares,” said Mr Hoq, who is Director (Equipment) of Allied-Steel(HK) company, Bangladesh agent forthe global Konecranes liftingbusinesses. Konecranes is integrallyinvolved in the expansion of theport through major Bangladeshicompany KDS Logistics Ltd.

KDS Group installed further world-class Konecranes liftingtechnologies as it expands itsoperations, originally founded onthe clothing business but nowextending through KDS Logisticsinto the country’s largest and mostmodern Inland Container Depot(ICD).

This facility is capable of holding20,000 containers at any one timeon a 20-hectare (46-acre) site in acongestion-free area on the outskirtsof Chittagong, on the DhakaChittagong highway 25 minutesfrom the sea port.

With a real-time computerised truck

handling facility, computerisedweighbridge and space for 700trucks inside its secure environment,the ICD features a container FreightStation build to world’s beststandards that can handle 120trucks under cover simultaneously,for loading and unloading (stuffingand unstuffing) of goods such ascotton, jute and food products.

The Konecranes fleet employed onthe site included a fleet of four SMV7/8 ECB 90 empty containerhandlers and three SMV 4531 TB 5reach stackers.

These were based on the latest portshandling technology of Konecranes,which employs more than 9700people at more than 485 locationsin 43 countries and has more than366,000 cranes of all brands underservice contracts.

The company is a world-leadingprovider of lifting and maintenancesolutions, with a track record inpioneering, leading and shapingdevelopments in the industry and anenduring strength in ports andmaterials handling.

Leading the way in the applicationof Canbus technology and electroniccontrols for lift trucks, Konecranesextended its revolutionary system toprovide real time data about thecontrols, hydraulics, engines,

transmissions and spreaders,which can be downloadedremotely and stored foranalysis. Using “Eco DriveSystem” port operators cantrack drivers in terms of fuelconsumption, productivehours, time driving versuslifting, container lifts to namea few.

Swedish-based KonecranesLifttrucks opened its secondproduction facility in 2007, in

Global materials handlingleaders focus on ChittagongThe historic port of Chittagong on the Bay of Bengal is undergoing a renaissance

as infrastructure and economic development in the region drive rapidly expanding tradevolumes through this major export/import centre of Bangladesh.

Swedish-based Konecranes’ Lifttrucks



focusShanghai, China which is now theLifttrucks Production, Sales andTechnical Support hub for the Asia-Pacific region. Singapore isenhanced as a regional sub-hub witha recent relocation to largerpremises.

The Shanghai plant assembles EmptyContainer Handlers and ReachStackers of the type employed byKDS. Key components are importedfrom Europe with emphasis onquality and knowledge transfer fromSweden. Konecranes believes theAsia market is receptive to latesttechnology and has adopted thestrategy of maintaining the brand’sgood reputation of superiorperformance.

Not only is the Konecranestechnology efficient, but the lifttrucks are also well equipped forsafety and environmental aspects,such as minimising noise and carbonpollution.

Environmental concern and safetyare built in with Konecranes. Qualityis built in, right through fromperformance to aesthetics, whichalso can be important, becausepresentation is important in themarketplace.

In association with Allied Steel, KDShas showcased for Konecranestechnology, demonstrating efficiencyand productive capacity to othercompanies in the region that havenot previously been exposed to thebrand. Sales have followed toChittagong Container TransportationCo (two empty container handlers)and Incotrade Limited (reachstacker). More are being negotiated.

The General Manager of KonecranesPte Ltd, Mr Steve Gagnuss, says thecompany’s focus on quality andlocal production in Asia is payingdividends.

“Konecranes as group has adoptedan aggressive growth strategy in Asiawith its China and broader Asianworkforce now exceeding 1000people. Through sales and servicecentres throughout China andthrough the broader south Asiaregion of Konecranes Pte Ltd, wehave been able to rapidly build anenduring market presence in ports,logistics and other markets.

“Our latest generation of reachstackers builds on many years ofdevelopment work and closepartnership with our customers. Thismeans that we can offer a highlymodern lift truck based on carefully

which is very important. All ourcranes have to be certified andsafety is part of our responsibilityas a caring employer with world’sbest practices,” said Mr Asri.

Konecranes has been involvedwith PenangPort since 1994,when the company took over allfacilities and services from thePenang Port Commission, whichlicenses Penang Port. The port -which deals extensively withcargo from countries includingMalaysia, Thailand and Indonesia– aims to be the premier port andlogistics chain integrator in theregion.

The General Manager ofKonecranes Pte Ltd, Mr SteveGagnuss, says PenangPort sharesKonecranes global best practicesemphasizing the importance of

preventive maintenance andcontinuous modernisation ofequipment.

“For these activities, Konecraneshas formed a global division,Konecranes Port Services, whichprovides service around the worldand combines our port servicesresources in all major markets.

“This huge pool of experienceenables us to apply locallythrough our on-site expertise thebenefits of complete service for allmakes and brands of port andharbour cranes.”

Konecranes is a world-leadingprovider of lifting andmaintenance solutions, with atrack record in pioneering, leadingand shaping developments in theindustry.

Konecranes South Asia Pacificregion clients include Alstom,BHP Billiton, General Electric,Hyundai Heavy Industries, LihirGold, Siemens, Samsung HeavyIndustries, Ratchaburi PowerStation, Thaikraft, Toshiba, UncleTobys, Dung Quat Refinery, ShellEastern Petroleum, IHICorporation, Hwa Yew IronWorks, Univac PrecisionEngineering, Schlumberger,Sembawang Shipyard, SysconPrivate Limited, HorizonSingapore Terminal, LandTransport Authority, Changi WaterTreatment Reclamation Project,and Tricaftan EnvironmentalTechnology.

nextSTEPVisit: www.konecranes.com

selected components and a fuel-efficient engine that delivers hightorque even at low rpm.

“Customers also get access to a stringof innovative solutions to simplifytheir work. Konecranes is proud toclaim to be the only company withload-sensing ‘power-on demand’hydraulics on all of our trucks, fromempty container handler to thelargest top-loaders and reachstackers. Unlike conventionalhydraulic system that require highpower output, the load-sensingsystem adapts the engine power theload weight lifted, resulting in betterfuel consumption and less enginewear, along with reduced emissions.

“Konecranes is confident andcommitted to the Asia region as alifting company. One example of thisis the fact that is Konecranes hasbeen rewarded with an order for fournew-generation rubber tired gantry(RTG) cranes from Indonesian portoperator PT Terminal PetikemasSurabaya (TPS).

Konecranes’ strategy is based on thecombination of capitalising theirextensive service network, leadingtechnology, fast paced industrialconsolidation, and a focus onefficient supply chains.

From page 25

Penang Port’s main line vision shared by Konecranes group



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Asia Manufacturing News February 2011

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Transcript of Asia Manufacturing News February 2011