Euro Biz: Revving Up

Open ROad

Journal of the european Union Chamber of Commerce in China

Buying Chinese stocks • Insurance markets • Better beer

China’s car market puts its foot on the gas

aug 2009

Journal of the european Union Cham

ber of Comm

erce in China

aug 2009

� August 2009 | EuroBiz

contentsaugust 2009

14

18

12 President's Foreword

In ChIna

14 Business

14 Macro

15 Europe

ChaMBEr UPdatEs

1� In Focus

• This month in the Chamber

• Lobbying highlights

19 Chamber Diary

• Welcome new members!

IntErvIEws

20 Chamber Interview

A conversation with Hans-Joerg Probst of Ergo

Insurance

22 new Generation

Greennovate's Mihela Hladin on promoting

environmentalism

15

8 August 2009 | EuroBiz

COLUMns

24 Market Intelligence Laura Michelson

Foreign firms need better information on

domestic competition

2� Management Bill Dodson

Expat GMs still like China, it's headquarters

that's bothering them

28 Corporate training gabor Holch

Getting more bang for the same training buck

30 wealth Management anthony noto

Is it time to put your money in Chinese markets?

FEatUrEs

32 Cover story automotive

The expansion of the Chinese car market is good

for domestic and foreign manufacturers alike

38 regions Hangzhou

Entrepreneurial Hangzhou is clustering

information technology

30

contentsaugust 2009

38

34


contentsaugust 2009

41LIFE

41 Golf

Roving golfer Ty Webb assesses the Jian Lake

Golf Club in Zhejiang

42 drinking

Is it last call for China's brewpubs?

48 Chamber Board

50 advisory Council

52 China dining

54 Business toolkit

5� Company Index

58 Out of the Box

Certification bodies are busy as Chinese organic

food producers attempt to go global

58

42

EuroBiz | August 2009 11

EuroBiz is free of charge. For extra copies please e-mail: [email protected] For editorial enquiries please e-mail the editor: [email protected]

European Union Chamber of Commerce in ChinaBeijing Office: Lufthansa Centre, Office C412, 50 Liangmaqiao Lu Chaoyang District, Beijing 100016Tel: 010 6462 2066 Fax: 010 6462 2067 E-mail: [email protected] Office: Unit 2204, Shui On Plaza, 333 Huai Hai Zhong Road, Shanghai, 200021Tel: 021 6385 2023, 6385 2133 Fax: 021 6385 2381 E-mail: [email protected] Office: Unit 3005, 30t/F, Tower A, China Shine Plaza, No.9 Linhe Xi Road,Tianhe District, Guangzhou 510613 Tel: 20 3801 0467 Fax: 20 3801 0275 Email: [email protected] Office:Rm. 308, 3/F Chinese Overseas Scholars Venture Building, South District,Shenzhen Hi-Tech Industry Park, Shenzhen 518057Tel: 0755 8635 0920 Fax: 0755 8632 9785, E-mail: [email protected] Nanjing Office: E1, 30/F Zhujiang No.1, 1 Zhujiang Lu, Nanjing, Jiangsu 210009Tel: 025 8362 7330 Fax: 025 8362 7331 E-mail: [email protected] Office: Garden City Hotel, Room 811, No. 8 Daye Lu, Chengdu, Sichuan 610016 Tel: 028 8671 0577 Fax: 028 8666 5844 E-mail: [email protected] Office:Room 2-1105, Office Tower 1, City Plaza, Shenyang 110001Tel: 0024 8681 1888 Fax: 024 8107 7521 E-mail: [email protected] Office:Room 15A17, Suite 17, Magnetic Plaza, Binshui Xi Lu, Tianjin 300381Tel: 22 2374 1122 Fax: 22 2741 8822 E-mail: [email protected]: www.europeanchamber.com.cn

ProductionEditor: Pete SweeneyDesigner: Tony WanDesign Manager: Ricky DengDistribution Manager: Vivien WangCirculation Manager: Rebecca CaoContributors: Laura Michelson, Gabor Holch, Anthony Noto, William Dodson, Orlando Crowcroft, Mark Andrews, Matt Koon, Mark Godfrey

AdvertisingDirector of Sales: Patrick LinehanDeputy Director of Sales: Caroline FontaineSales Managers: Jason Yan, Matthew Sumner, Juliana Piedrahita, Obie Gao, Fabien Bouhier, Karen LoDirector, Industrial Zones & Investment Bureaus: Seth JacobsAccounts Administrator: Ivril HuangTel: 021 5385 9063

EuroBizEuroBiz magazine is the journal of the European Union Chamber

of Commerce in China, published monthly by SinoMedia Ltd.

For reservation or enquiries,please contact us at +86 20 87372988-7085/7086

9, Mingyue Yi Road, Guangzhou Main Road Central

Guangzhou, Guangdong 510600, P.R.C.

Email: [email protected]

Website: www.ramadagz.com / www.ramada.com

Welcome the delegates to attendthe 106th Chinese Import & Export Fair!

Benefits:• Welcome drink• Complimentary High Speed Internet Access • Complimentary shuttle bus service to and from the

Pazhou Complex • Complimentary shuttle bus pick up from

Guangzhou-Kowloon railway station• Complimentary domestic call & local call (except

Hongkong, Macau and Taiwan) • Complimentary use of gym, indoor and outdoor

swimming pool • Earn Wyndham Rewards points or airline miles

Exhibition Period:Oct.14-18 & 22-26, Oct.30-Nov 3, 2009Business Room: RMB1200 net Enjoy a 25% Early Bird discount, reservation made beforeAugust 31, 2009

Break Period: Oct.19-21 & 27-29, 2009Business Room: RMB 630 net


na's exports to EU GDP growth: a 1 percent de-cline in EU GDP growth induces an 11.5 percent decline in Chinese exports.

China is the clear winner from globalisation and has reaped benefits from its accession to WTO in 2001. FDI has played a crucial role in China's three decades of reform and growth. In-vestment by EU companies has introduced new technology and business experience to the Mid-dle Kingdom, and it has powered China's rise from about 3 percent of global market share for high-tech goods in 1995 to 15 percent in 2008.

The Chinese government itself believes that about 40 percent of technology transfers into China originate in Europe through European exports or investment. Surprisingly, European FDI in China only represents 3 percent of total EU investment abroad. Certainly the quality of European greenfield investment in manufactur-ing is very important in China compared with many other locations – portfolio investment in the financials sector in Wall Street for in-stance – yet the data indicate that more could be achieved.

There is still a sense among European busi-nesses that despite big achievements, condi-tions for investors are still subject to too many serious restrictions. This was voiced clearly in the recent European Chamber Business Confi-dence Survey published last month. European investors in high-tech and branded goods are interested in the Chinese market, but they fear the theft of intellectual property if they transfer technology. They face a relatively unpredict-able mergers-and-acquisitions policy. The bar-riers to market entry – the establishment costs in capital requirements, licensing, forced joint ventures and ownership caps – make it difficult for European companies to choose China as an investment destination. Europe matters a lot to China, but the economic openness of China matters to us even more.

Joerg WuttkePresident

prEsidEnt's forEword

China matters a lot for European business. But does Europe matter to China?

EU exports to China rose to €78 billion in 2008 compared with only €26 billion in 2000. As a result, China was the EU's fourth most important export market in 2008, behind the US (€249 billion), Russia (€105 billion) and surprisingly even behind Switzerland (€98 bil-lion). China accounts for 6 percent of exports from the 27 EU countries, but this translates to a share of just 0.7 percent of EU GDP.

So what about the other direction, China to Europe? Imports from China into the EU rose to €248 billion, turning the EU into China's big-gest export market. Chinese products account for 16 percent of all EU imports.

The flow of competitively priced goods from China benefits Europeans by restraining infla-tion, contributing to the well-being of European consumers – particularly those of modest in-come – and reducing the cost of supplying Eu-ropean consumers' basic needs, thereby increas-ing the balance of disposable income available to purchase high-end, locally produced goods and services. Europe is now China's most im-portant customer, taking 20 percent of all Chi-nese exports in 2008 (the US takes 17 percent and Japan takes 9 percent).

In the media, the EU's trade deficit of €170bn in 2008 with China catches headlines. As staggering as this figure is, its significance is overrated. The European Chamber does not believe that a perfect balance of trade between the EU and China would in itself be desirable or normal. What matters are the barriers to trade and investment in China, which in 2006 were estimated to cost EU businesses €21 billion in lost trade opportunities every year. That is the equivalent of the total GDP of Bulgaria.

In other terms, it equals fully one-quarter of all current EU exports to China. China appears to have put out the welcome red carpet for for-eign trade and investment, but to some the door seems only half-open. In some cases, it appears to be swinging shut. Action is required to cor-rect that, otherwise European concerns about the trade imbalance and market access will only grow.

Europe's economic development matters more to China at this stage than the other way around – for many certainly a surprising find-ing. There are estimates of the elasticity of Chi-

Joerg wuttke President

European Union Chamber of Commerce in China

Dear readers,

vote of confidence


in chinAin chinA

BUsInEss

ChemChina to restart bid-ding for dow unit China National Chemical Corp (ChemChina), the mainland's largest chemicals maker, has resumed bid-ding for Dow Chemical's agricul-tural chemical unit. Dow restarted an auction for Dow AgroSciences, which could command a price of up to US$7 billion (€5 billion), pitting ChemChina against Monsanto and Switzerland's Sygenta, the world's biggest farm chemicals maker. ChemChina has previously rejected offers of a minority stake in the unit, favoring a takeover or joint venture.

China tightens controls on dairy imports The Ministry of Commerce an-nounced that it is tightening controls on imported dairy products to protect a domestic dairy indus-try that has struggled to rebound from last year's contaminated milk scandal. The new rules stipulate that importers of fresh milk, milk pow-der and whey will need to obtain an import license and provide detailed information on products each time they import, starting in August.

rio tinto evacuates China research staff Australian mining firm Rio Tinto has evacuated its entire staff in Chi-na involved in research of the iron ore and steel industries. The move

was made in response to the deten-tion of Rio Tinto's Stern Hu, who heads iron ore marketing in China, on suspicion of stealing state secrets along with three other members of the company's iron ore team. Other "foreign groups" are following Rio Tinto's lead and moving employees out of China.

China on course to become world's largest auto market Chinese auto sales increased at the quickest rate this year in June, put-ting the country on course to top the US as the world's largest auto market, according to figures released by the China Association of Auto-mobile Manufacturers. Sales rose 36.5 percent year-on-year in June to 1.4 million units, the fourth month in a row that volumes have topped 1.1 million units. Meanwhile, US car and light truck sales dropped 28 percent year-on-year to 860,000. The jump in Chinese auto sales is attributed in a large part to govern-ment subsidies and tax breaks on the purchase of smaller vehicles.

MaCrO

Exports, imports fall sharply in MayChina's imports and exports both fell in May, but some analysts said the worst is likely over as investment rose sharply. May exports decreased by a record 26.4 percent from the same month last year, while imports were down 25.2 percent, according to China's customs agency. Despite a year-on-year import decline, demand for

foreign raw materials is increasing as Beijing's stimulus spending takes hold.

China's second quarter GdP up 7.9% China's annual GDP growth jumped in the second quarter to 7.9 percent from 6.1 percent last quarter. The 7.9 per-cent jump, announced by the National Bureau of Statistics (NBS) was made possible by heavy stimulus, and beat economists' predictions of a second-quarter growth rate of 7.5 percent. Urban per-capita incomes increased 11.2 percent and real rural per-capita incomes increased 8.1 percent.

world Bank revises China growth forecast to 7.2% The World Bank said China's economy would grow 7.2 percent in 2009, in an upward revision from its previous forecast of 6.5 percent. In its latest quarterly report, the bank pointed to high levels of lending and a loose monetary environment in making the change. The massive monetary influx is expected to fuel economic growth in coming quarters.

GaQsIQ to establish product safety blacklist China's product-quality watchdog is set to establish a publicly avail-able blacklist of companies that fail to meet acceptable standards. The move was made in an effort to halt the string of product safety scandals

REJECTED: MofCom suspects foreign milk

HALF-EMPTY: Imports declined in May

HOME-MADE: An Airbus A320 rolls off the lines

PTX

IC

IC


airbus delivers first China-produced plane European aircraft maker Airbus delivered its first middle-distance aircraft to be entirely assembled in China last month. The A320 air-plane, which was made at a factory in northern Tianjin, was delivered to Dragon Aviation Leasing and will be flown by regional carrier Sichuan Airlines. The delivery of the A320 coincides with an order

signed in June by China Eastern Airlines for 20 Airbus A320s to be delivered by 2013. Aviation analysts expect China to surpass the US to become the world's larg-est market for civil aircraft over the course of the next few decades. China is expected to buy 2,800 new planes over the next 20 years valued at €232 billion.

that have hit China over the past year. The General Administration of Quality Supervision, Inspection and Quarantine (GAQSIQ) said that a na-tional network would be established to provide information on supervi-sion, food, measurements, standards, approval, quarantine and inspection.

Indian sMEs call for China trade investigations India's Federation of Chambers of Commerce has called for New Delhi to accelerate anti-dumping investiga-tions on imported Chinese goods. The industry body, which represents small- and medium-sized enterprises

in India, said that inexpensive Chinese products had damaged the market share of two-thirds of the companies it surveyed due to "typi-cal Chinese predatory pricing."

EU-ChIna

PetroChina may invest in UK refinery PetroChina is involved in discus-sions to make its first investment in a European refiner. If the state oil firm, which is involved in both oil produc-tion and refining, were to invest in the Ineos refinery, it would be the latest in a string of energy-related investments by Chinese firms. In May, PetroChina spent US$1 billion (€700 million) to acquire a 45.5 percent stake in Singa-pore Petroleum Co from Keppel Corp.

Xinhua to launch tv program in Europe State-run news agency Xinhua will launch a television program in su-permarkets and outside Chinese em-bassies in Europe to bring Beijing's view of the world to a Western audi-ence. Beijing will offer US$4.4 bil-lion to US$6.6 billion (€3.1 to €4.7 billion) to media groups to carry the programming in Brussels and other European cities. The Xinhua TV offering is part of a larger move by Beijing that has also included overseas circulation for China Daily and an English-language edition of the Global Times newspaper.

INSATIABLE: PetroChina to invest in the UK

HOME-MADE: An Airbus A320 rolls off the lines

IC

1� August 2009 | EuroBiz

chAmBEr UpdAtEs

this month in the Chamber Financial Forum Conference The first ever European Union Shanghai International Financial Forum took place on June 25, 2009 at the Grand Hyatt Hotel, Shanghai, attracting more than 200 attendees. The event was jointly organised by the European Union Chamber of Commerce in China and the Shang-hai Municipal Government Financial Services Office with the objective of examining the implementation of the plan to develop Shanghai into an in-ternational financial centre by 2020.

In his keynote address, Dr Fang Xinghai, director-general of the Shanghai Municipal Government Fi-nancial Services Office, emphasised that the greater internationalisation of Shanghai would benefit China as a whole. He stated that there needs to be greater decentralisation of the current national financial framework with increased delegation of pow-ers passed from Beijing to the local branches of the regulators.

He further stated that China should be opened up more to compe-tition from foreign firms in order to increase the provision of high-quality financial services, and he announced

that details of new "Financial Talent Awards" will be released soon. These will work to reduce the tax burden on key figures working in the finan-cial sector in Shanghai.

Further speeches were delivered by Dr Zheng Yang, director-general for the Foreign Exchange Adminis-tration of the People's Bank of China Shanghai, on the use of trials and first practices to accelerate the de-velopment of Shanghai as an inter-national financial centre. Dr Zhang Guangping, deputy director-general of CBRC Shanghai, spoke about deri-vates in China. Dr Jun Ma, chief econ-omist of the Greater China region for Deutsche Bank, gave his view on the current global economic climate and what this means for Shanghai's development. Dr Zhu Rongen, presi-dent of Shanghai Brilliance Credit Rating and Investors Service Com-pany, gave his view on the necessity of developing supporting services, and Jackie Wang, global partner at Egon Zehnder, offered her opinions on what Shanghai needs to do to de-velop human capital in the city.

We would like to thank our kind sponsors and supporters of this im-

portant Chamber event:• Primary sponsors: EU-China Trade

Project and the City of London• Sponsors: China Treasury Online• Supported by: American Chamber of Commerce in Shanghai

President of turkey meets with Chamber membersThe European Chamber and Turk-ish Industry & Business Association (TÜSİAD) had the honour of hosting the President of Turkey, Abdullah Gül, for a unique dialogue session with Chamber members during the President's recent trip to China.

Arzuhan Doğan Yalçındağ, presi-dent of TÜSİAD, several Turkish state ministers, the Turkish Ambassador to China, and the president of The Union of Chambers and Commodity Exchanges of Turkey attended the ses-sion, which was moderated by Cham-ber President Joerg Wuttke.

Following introductory remarks by Iraz Turhan, TÜSİAD Beijing of-fice director and European Chamber SME Forum business manager, and by TÜSİAD president Yalçındağ, dis-cussion shifted to the challenges and opportunities facing European busi-nesses in China and the similarities with the Turkish experience.

Wuttke provided President Gül with an overview of the business en-vironment in China for foreign com-panies, drawing on findings from the Chamber's recently published Business Confidence Survey 2009 to support his assertion that European businesses remain confident in Chi-na's future, but want to see a further opening up of the country's economy to improve competitiveness.

Tarhan Feyzioglu, deputy rep-resentative with the International Monetary Fund (IMF) in China, then spoke on China's broader economic and investment climate, the govern-ment's macro-economic policies and their impact on investment growth, Dr Fang Xinghai addresses the Chamber Financial Forum Conference


and China's progress on the road to economic recovery.

Finally, Jens Ruebbert, head of Deutsche Bank China, introduced the issues facing foreign enterprises in the financial services sector in China, focusing on recommendations from the Chamber's position paper on market access and transparency.

Afterwards, President Gül dis-cussed his meetings with his Chinese counterparts, which had focused heavily on cooperation on economic issues. "Faced with the challenge of the current financial crisis, mutual understanding and cooperation are the priorities," he said.

dinner with tianjin's vice-Mayor The Vice-Mayor of Tianjin, Ren Xuefeng, joined with members of the Tianjin chapter of the European Chamber for an exclusive dinner on June 12th. More than 50 top execu-tives from key European businesses in Tianjin met with Ren, who is a key figure in the Tianjin Municipal Government and manages the city's commerce, economic cooperation and foreign affairs. In his address, Mayor Ren spoke about Tianjin's economic climate, provided statistics

on FDI to Tianjin in the first quarter of the year, and outlined the strate-gies the government is developing in response to the crisis.

wise investments in emerging leaders Are there ways to maximise returns on leadership investment and reap valuable returns? On June 4 and 5, the European Chamber held a semi-nar in Shenzhen and Guangzhou, inviting Dr Sarah Chan, Dr Karen Steadman and Dr Dirk Baxter from Leadership Insights International to

share their insights with members on "Unleashing Potential: Growing Your Emerging Leaders". They of-fered bold advice for investing wise-ly in emerging leaders, such as mi-nimising risk by selecting leaders on the correct fundamentals, requiring committed, consistent performance, introducing challenges to maximise growth, providing feedback from the environment, and measuring gains and re-investing dividends.

Chengdu Business Guide The European Chamber Chengdu

Attendees at a Financial Forum roundtable


chAmBEr diArY

Chapter will soon publish the Cheng-du Business Guide 2009 to provide an overview of the Chengdu busi-ness environment. Compared to the 2008 version, the 2009 guide will include more detailed information on Chengdu and its economic attrac-tions, covering tax policy, real estate, HR, IPR, expatriate services, logistics, and legal guidelines. The guide will also feature case studies of European Chamber member companies from a variety of sectors. The 2009 guide

will have a print run of more than 5,000 copies and will be distributed through the Chamber's extensive networks in China and Europe.

second annual Chamber Basketball tournament in nanjingFor the second year in a row, hoops fans from across Nanjing's Europe-an business community took to the courts last month for the European Chamber Nanjing Chapter's hugely

popular basketball tournament. Ten teams representing member compa-nies from a range of industries faced off in the round-robin group stages, after which just five were left stand-ing: Home Caught, Nanjing Interna-tional School, BASF YPC, and Sie-mens Numerical Control. But only two – Home Caught and Nanjing International School – would prog-ress to the final, with Home Caught finally emerging as champions of the 2009 tournament. ■

Lobbying highlights in MayThe EU Ambassador Abou Briefingwas held on May 12, addressing EU-China economic issues. Ambassador Serge Abou met with around 140 Eu-ropean Chamber members in Beijing during this event. The discussions touched upon a range of issues af-fecting EU businesses, including the financial crisis and trade relations.

The NDRC – EUCCC Joint Forum was held in Beijing on May 25 and 26. The joint high-level forum with the National Development and Re-form Commission (NDRC) was titled "Building sustainability within the petrochemical and chemical indus-try through energy savings, industry clustering and environment footprint reduction". The PCR Working Group has been working for two years to organise such a forum to create an exchange platform between Chinese authorities and the European chemi-cal industry in China.

A range of issues was discussed, including interpretations of the stim-ulus plan for the petrochemical and chemical industry, developments and trends, and energy savings and the promotion of a "circular econo-my". Attendees included delegates from several prominent Chinese in-stitutes, academies and government

bodies, as well as a large gathering of European Chamber members.

The Deputy Director General of the Ministry of Industry and Informa-tion Technology (MIIT) met with the European Chamber Lighting Working Group on May 14. During this meet-ing, the two sides exchanged views on waste of electrical and electronic equipment (WEEE), restriction of haz-ardous substances (RoHS) and issues of common interest.

The Deputy Director General of the Centre of Science and Technology of Ministry of Housing and Urban Rural Development (MOHURD) met with the European Chamber Con-struction Working Group in Beijing on May 14 to receive the Position Paper 2008/2009. During the meeting, the two sides exchanged views on issues relating to the construction industry, including recent developments, laws and regulations imposed upon for-eign investors in China, and the over-all future outlook for the construction industry in China. The Centre of Sci-ence and Technology also showed a great interest in participating in proj-ects like the SWITCH project, an EU initiative to promote sustainable de-velopment and alleviate poverty.

The Director General of the Nation-al Tourism Administration (CNTA) met with the European Chamber Travel Working Group as a follow-up meeting to further discuss the imple-mentation rules for the new law on Travel Agency Regulation, which came into effect May 1. The two sides exchanged views on how to improve the overall travel market in China, the outlook for 2009 and further co-operation opportunities. CNTA also presented the plan of the pilot proj-ects for the outbound travel market.

Cosmetics WG EU-China Workshop on Application of Standardization in China: On May 26 and 27, mem-bers of the Cosmetics and Lighting working groups in Beijing took part in a standards workshop organised by the EUCTP and European Chamber, which also featured several represen-tatives from the SAC and AQSIQ.

The China-EU Round Table Meeting and Dinner was held on May 19. The Chairman of the Tianjin board met with prominent local figures to discuss issues including the recycling industry, economic and social rights in the EU and China, and combating the financial crisis in terms of potential solutions for the EU, China and Tianjin. ■


welcome new members!The European Chamber extends our warm welcome to all new member companies in all chapters who joined us during the past two months:

BeijingAbbott Laboratories Trading (Shanghai) AgropromotionArreon Carbon British Sugar Bureau VeritasClifford Chance Double Dragon Travel Ethical EdgeIci Caldaie Spa (Beijing)Links Moving Nestle (China)Nord Anglia Consulting (Beijing) Pacnet Business Solutions (China)Siemens VDO Asia Pacific (Shanghai)The St Regis (Beijing)Western Academy of Beijing

ChengduAlliance Francaise de ChengduAngel Obstetrics and Gynecology HospitalGerman EAVN Group GMBHRieter Automotive Sound-Proof Parts (Chongqing) Sofitel Forebase ChongqingYaFei Dental Group

NanjingHuurnink Indoor Environmental ServicesMa An Shan Spanesi Car Repair Equipment Pearl River DeltaArvato Logistics Services China DecathlonGoodrichJiangmen Emak Outdoor Power Equipment JW Marriott Hotel ShenzhenOn LimitedPacnet Business Solutions (China)Raiffeisen Zentralbank Osterreich

AG, Zhuhai Representative OfficeRoyal CargoTucano ShanghaiAgropromotionAker Projects (Shanghai) Bansard InternationalDanone Dairy Sales Gazeley Investment Consulting (Shanghai) HuthwaiteJaguar Land Rover ChinaNovosana (Taicang) Pacnet Business Solutions (China)Schrader ElectronicsSeco Tools (Shanghai) Wenfei Business Consulting (Shanghai) ShenyangWuerth Holding (China) TianjinBetatafence Wire and Mesh Products (Tianjin) Mdexx Magnetronics Tianjin

China by Numbers is the most comprehensive

guide to the figures that are shaping China.

OUT NOW Only US$40/RMB280

China by Numbers 2009

Tel: +852 3175 0322, or +86 21 5187 9633 ext. 864and +86 10 5166 2335 ext. [email protected] www.ChinaEconomicReview.com/book/cbn

CONTACT US TO ORDER

The 2009 edition is fully updated and revised.


chAmBEr intErViEw • ErGo

risk avoidancehans-Joerg probst of Ergo insurance on spreading coverage

Hans-Joerg Probst came to China for the first time in 1970 as a young student on an intern-ship as a press officer. He studied Chinese language and economics in Berlin, and was lucky enough to make a career of his passion for China. This January, Ergo Insurance Group asked Probst to help them run their operations in China. He currently serves as Ergo's chief representative in Beijing. EuroBiz talked to Probst about Ergo's approach to spreading in-surance awareness throughout China.

Q: Ergo is a relatively recent arrival to China. Can you tell us about the company's background?A: Ergo was founded 11 years ago as a hold-ing company by Munich Reinsurance Com-pany [Munich RE], the largest reinsurance company in the world, to bundle together all their insurance products. But it's really im-portant to emphasise that the companies in-side Ergo, the operational entities, have a re-ally long history. Now Ergo is also looking at emerging markets in Asia, focusing on China and India, and it opened a representative of-fice in China in 2007.

Q: What makes Ergo think it can succeed in China after showing up so late?A: I think this is a valid question, but first of all the insurance density is still pretty low, even by standards of other emerging markets. Because the market is far from saturated, there is still huge potential for newcomers. Also, Ergo will not be starting in large cities like Beijing and Shanghai. We have set up op-erations in second-tier and third-tier cities in areas like Liaoning, Shandong, Henan, Hebei and Sichuan. They all have tremendous po-tential because they have large populations, but insurance penetration is quite low. Q: Are there any differences in approach?A: We focus on professional training of in-surance agents and this is definitely different from what China has at the moment. The cur-rent standard is, you recruit agents and after one year you only have maybe 30 percent of

who you started with. There's very high vola-tility. In addition, insurance agents do not have the image of being very professional. There is a lot of mis-selling where people are just badly trained and lack sufficient knowl-edge to explain to consumers what they are actually selling. Sales teams are relying on relationship sales where people are buying insurance because they know the person who is recommending it. What the agent should be doing is explaining what the product is and why they should be buying it. We want our agents to act as a sort of financial advisor – although we won't call them that – but they need to be able to act that way to a family. Most of our competitors are focusing on ban-cassurance: bank tellers offering insurance to their walk-in customers. Bancassurance in terms of depth of advice is very superficial, so we don't think this is a good channel for increasing insurance awareness.

Q: What is the central government doing to encourage foreign insurance firms to ex-pand into lower-tier cities?A: Basically it boils down to political appeals, but there are some minor incentives. Local authorities are allowed to reduce rental rates and provide local tax incentives when you set up a company in their region. But the main incentive is the speed with which you can set up an office. If you are trying to set up an office in Beijing, Shanghai, or Guangdong, your waiting time could be longer. This wait-ing period is basically the political lever the government has created through the regula-tory authority to direct insurance compa-nies towards the underdeveloped markets. But when these firms go into the provinces, CIRC [China Insurance Regulatory Commis-sion] wants them to contribute to education and professionalisation of the markets. CIRC does not want to see us poaching from other local insurance companies. I think this is rea-sonable.

Q: How is the product mixture changing?A: The market in China is shifting away from

hans-Joerg Probst, chief representative in Beijing for Ergo insurance


heavy reliance on investment-linked insurance projects – that's how life insurance started here – into more risk-focused long-term provision. In the past, Chinese people bought insurance as an alternative to bank deposits, because insurance prod-ucts in the 90s were offering similar interest rates. In the long term, this is not a feasible approach. People need to create their own capital base for longer-term provision. For ex-ample, in European life insurance, you pay relatively small amounts to cover against the risk of death, but there's no capital return, no savings component. But the upside is you are protected against the death of the breadwinner. We think this is more appropriate for China.

Q: Ergo and its competitors are try-ing to import Western ideas about insurance into China. Given your

experience in both markets, what are some aspects of Western insur-ance that should not be imported?A: What needs to be left behind, in my view, is over-selling. The West is a saturated market. You are inundat-ed by offers, and some offers are not transparent. This is particularly true in critical areas like health and acci-dent insurance. In a saturated mar-ket, agents still want you to buy even though you are adequately covered. Second, agents are trying to buy you out of your previous insurance en-gagements to make a sale. This is all eating up the same pasture.

Q: What needs to be fixed on the Chinese side in terms of regula-tion?A: The issue is enforcement. In terms of managing a market, China is migrating from administrative methods – requesting reports etc.

– to looking at capital adequacy ra-tios. If someone buys a 1 million RMB life insurance policy, you need to have a technical reserve in your pocket so you can pay out if he dies the next day. This seems to be a problem with some Chinese compa-nies, because they don't have suffi-cient capital. It was workable for a certain period of time. These new medium-sized insurance companies in China were growing so quickly, so they had sufficient growth in new premium receipts to cover their payouts. Since the financial crisis, however, they have had less premi-um growth, and now their capital is insufficient. This really concerns the regulators. But the major political goal is expanding coverage, so they tolerate solvency problems. It's a difficult balance between enforcing solvency and helping the market to grow quickly. ■


intErViEw • GrEEnnoVAtE

Greennovate launched its environmental con-sultancy in Shanghai in 2007 and since then has worked on a variety of high-profile proj-ects. EuroBiz spoke with Mihela Hladin, found-er and director of Greennovate, in her office – furnished using recycled and renewable ma-terial and lit by energy-efficient fluorescents – about the burgeoning environmental move-ment in China.

Q: What inspired you start an environmen-tal consulting firm in China?A: I'm from Slovenia. I was born in a beau-tiful country with a beautiful environment, and I never knew I was lucky until I came here to China. I was transferred here while I was working with an environmental engi-neering company. We were focused on de-veloping wastewater treatment facilities for the metallurgical sector. I travelled to the most interesting places in China, but I didn't see where the whole thing was going. I was working with great people who were pushing industry forward very fast but compromis-ing on the environment. It wasn't an issue of financial resources; it had to do with basic awareness with how long the consequences of industrialisation will last. At dinner in one town, I asked an older resident if he thought his kids would come back and live in the area, and he was shocked. He had probably never thought beyond providing them with financial stability.

Q: What are you trying achieve and who are you working with?A: We are developing unique, green ser-vices with a measurable impact. We are a green hub for innovative people and re-sponsible companies, so when a company wants to do something related to environ-mental awareness, you are most probably going to bump into us. We want to work with companies that really care and see us as more than something to put in their CSR report. We want people to understand that the issues aren't too big for them and that

Greennovate's mihela hladin on promoting environmentalism

Green gold

Mihela hladin is founder and director of Greennovate (www.greenovate.org)

everyone has a role in making China a bet-ter place to live.

Q: And how have these goals been imple-mented through your programs?We started modestly on our own funding, developing a programme called GECKO to help high school students in more rural areas to start thinking about the environment. The programme has expanded from teaching high schools in rural Guizhou and Hubei province to training Fudan University students here in Shanghai to go out and teach the programme themselves in Qinghai and Yunnan. Training these university students has really allowed us to broaden our impact at time when no one can support the programme. In Shanghai, we started the Reuse.bag programme when the government banned plastic bags, and it received a lot of press coverage. Then we de-signed our green office as an example of how simple it is to be green. We used sustainable resources like bamboo and reused old materi-als like saw boards for tables. last October. We also teamed up with Eno, an indepent fashion design company, to reach out to young people with a simple message that "Green is the New Gold". Chinese designers have been making t-shirts to convey our message through fashion. This year we have a new series called NETI with them, communicating energy, waste and water messages on shirts.

Q: What have you been able to do with your corporate clients?A: We just finished a big project with FedEx. We worked with their team in the Wuhan of-fice for about six months on environmental topics from environmental footprints, energy and population challenges to green innova-tions. Each time we were there they went to schools in the area and taught what they learned. Our next challenge is to start tailor-ing our services to SMEs, which are crucial for environmental awareness, and offer them affordable projects that they can get involved in.


Q: How do your services create value for your clients beyond im-proving the environment and their public image?A: Companies put us in the CSR sec-tion when maybe we don't belong there. Our programmes go beyond environmental impact in many ways. The environment touches and affects everyone, and when employees see that a company cares about the envi-ronment, it increases company loyal-ty. I would argue that the team build-ing skills we provide aren't included in CSR programs, and I believe that basic environmental awareness should be part of regular training too. Of course we are able do things like save money on energy costs and supply chains, but this should just be a consequence. Certifications and checklists in the supply chain are one thing, but getting employees to understand why they are doing these

things creates long-term success in a corporation.

Q: With state media expressing concern for the environment, have you had any support from the gov-ernment at any level?A: The government and environ-mental communication have really changed in the last few years. They are becoming very open to environmen-tal issues in the media. Things change much more quickly here than in the West. Wherever we go, we have re-ceived their support. We always work with local governments because we want to have their blessing before we do anything. We talk a lot with them about environmental career opportu-nities with things like green-tech. We tell them, "It's real, it's here, it could be your next step." The Centre for En-vironmental Education and Commu-nications has also recognised us, and

we are in talks now to become a part of the Green School Programme.

Q: Why have you reached out to youth and businesses in lower-tier cities? A: Industries in cities under 5 million people usually have had the largest environmental impact in China. We wanted to teach high school students because the older factory owners probably won't change their minds. Most of these students will stay in these communities and work, so even-tually the change will come. We chose fashion as our medium for environ-mental activism in the cities because – lets face it – fashion is cool. Every teenager wants to be cool. We also use social networking sites as a powerful tool. If you can get kids to connect en-vironmentalism with being cool, then we don't just have to push it and it happens organically. ■


coLUmn • mArKEt intELLiGEncE

Until very recently, foreign businesses in China have been able to sell their prod-

ucts due to superior quality; their Chinese competitors were satis-fied with the lower-price end of the market. This has been conventional wisdom for quite some time, but the conventional wisdom is increasingly dated.

The growing strength of Chinese competition is changing consump-tion trends. At the same time, the vol-ume of new, foreign products hitting the shelves is lower and the range of products being promoted as "new" in China is also narrowing. As a result of these two trends, it is becoming more important for multinationals to understand and track their Chinese competitors. Less market research and more market intelligence is now required.

rate of decayUnfortunately, gathering market in-telligence in China is no easy task. One of the main challenges for man-agers is predicting the moves of com-petitors. There is no complete Dun & Bradstreet service in China, very limited statistics on demographics, almost no sophisticated business re-search panels and very low customer loyalty program penetration. In addi-tion, there is very little detail of com-pany strategy or much else listed on the websites of most Chinese compa-nies. Even if a company has data on the internet, business data in China decays at a rate of at least 6 percent per year.

The scale of the problem is also a challenge. According to the State Ad-ministration for Industry and Com-

Laura Mitchelson is managing director for Amber, a shanghai-based business intelligence consultancy. Laura has 15 years experience in china, advising companies on operations and marketing strategy and managing in-depth market studies. As director on all key projects at Amber, she has delivered more than 100 international client research projects in mainland china.

Competing with Chinaforeign firms need better information on domestic competitionBy Laura Michelson

merce, there are around 9.7 million companies registered in China. One client recently was trying to keep track of what they described as their "key 125 competitors in China". Obvi-ously, the scope of such a project is massive.

There are a number of ways to combat the inherent difficulties of gaining market intelligence here. Given China's limited information infrastructure, foreign companies should consult a wider range of in-formation sources during secondary research than they would in a more developed market. This means go-ing beyond basic Google searches to Chinese language news aggregators, commercial databases and deep into the web.

don't trust, verifyBut even if such searches yield data, how reliable is it? To mitigate the risk of garbage-in, garbage out, take advan-tage of experts to validate your data. Use researchers either internally or externally who have first-hand experi-ence with primary research in China, and who can read between the lines and accurately interpret what they are hearing, seeing or reading. Find people who can ask the questions that solicit concrete answers and who sys-tematically cross-check and triangu-late information.

Always keep in mind the timing of your data and what it is telling you about the market. The time lag in the release of even the most basic infor-mation and statistics in China means that you are often behind the curve. There is a delayed reaction to market information in many industries in China, meaning it's essential to dou-


ble-check the official growth or trend figures against the predictions of those within the industry and among your competition.

With a generation shift every 3-4 years, also bear in mind that some of your younger team members are not old enough to bring any historical perspective to the analysis they do on industry or competitor develop-ments.

Furthermore, there are alterna-tives to gathering market intelligence through programs that are designed primarily for that end. Using a sales team seems to be the solution of choice for many businesses trying to keep track of their Chinese competi-tors.

A sales team has to keep you ahead of your local competitors through understanding and predicting their moves. They are on the front lines of the market, and vital information

about your competitors will simply not be finding its way back to deci-sion makers unless you open this channel.

Internal biasOn the other hand, sales teams may not be the best filter of key informa-tion about market trends or competi-tors. They are incentivised to sell, not inform policy, yet many businesses gather most, if not all, of their com-petitor information from their sales teams. This is the easiest and often ap-pears to be the fastest route to infor-mation, but risks internal bias.

If your business is dependent on internal sources of information on the way markets move and on your competitor's plans, there are many methods for maximising output. En-sure information flows from man-agement down, and reward upward intelligence providers. Offer concrete

examples of where improved busi-ness intelligence and knowledge sharing within the company have led to improved sales or to better cus-tomer retention.

Make sure everyone knows how to use the web to maximum effect – this is not a given in an environ-ment where cultural values and back-ground play into ideas of what is strategically important. Include busi-ness intelligence gathering in the job descriptions of all your middle- and senior-level managers.

If your firm employs the strate-gies suggested above, it will have a much better chance of keeping, or gaining, market share. If, on the oth-er hand, you are content to rest on your laurels, confident that being for-eign alone is enough to protect your brand and revenue streams indefi-nitely, you may be in for an unpleas-ant surprise. ■

2� August 2009 | EuroBiz

There's a lot of uneasiness in the ex-pat community in China today, but it's not because China has lost its

charms. It's the corporate situation that seems to be making a whole generation of expat general managers grumpy.

By "generation", I mean those who came here three or four years ago to establish a Chi-na operation from scratch. They were chosen specifically because task was Herculean and required an uncommon collection of experi-ences, attitudes and skills. But today, some of them feel distinctly under-appreciated.

Arnold is just such a general manager. Sent by his UK-based company to set up an operation to manage supplier networks in China, he was able to successfully ship a profitable product back to the UK within two years of establishment.

But in the late spring of 2008, when time came for performance reviews, Arnold be-lieved he deserved a raise and a stake in the China company, which had surpassed ex-pectations. What he heard was: "Well, you know we've got a downturn in the econo-my, let's delay that discussion for a bit."

Arnold still has his current management role, but he's uncertain about a lot of things: whether he has a job to return to in the UK; whether he'll be adequately compensated for his string of successes; and whether headquarters will even keep the Chinese operation running.

Mads, the former GM of a Danish sales and design office in China, had started lob-bying for a new post a year before his con-tract had come due for renewal. The China operation he had established had surpassed its sales goals and was actually one of the bright spots in the company's balance sheet during the downturn.

But after the CEO was replaced by anoth-er individual, who subsequently replaced top management with his own people, Mads realised he may actually lose his own

coLUmn • mAnAGEmEnt

Bill dodson has been managing, advising and writing on china business and economics since 2000. he has been quoted on china-related issues in a variety of international publications, and speaks regularly at china industry conferences. he writes the popular blog this is china! (thisischinablog.com). You can contact him at [email protected].

the discontentedExpat Gms still like china, it's headquarters that's bothering themBy Bill dodson

job in the company, despite returning stel-lar results. Active lobbying for clarification of his next role in the company led to an offer of a "global advisory" position - code words for gradual layoff.

re-enchantmentThis is, to put it mildly, short-sighted. Stra-tegic adjustments are sometimes necessary, but companies that plan to be in China for the long haul have a lot to lose by removing or demoralising the one person who under-stands their Chinese operations best. Replac-ing them, as a rule, is not easy.

Sending in fresh blood in the form of a troubleshooter has its advantages, but only if the troubleshooter has deep busi-ness experience in China. Ditto for promot-ing domestic management, which can save money on the bottom line but can also lead to severe communications problems. Also, unlike seasoned foreign managers, most Chinese managers have never experienced a down business cycle before.

So assuming there is a business case for keeping the first-generation GM around, how can firms motivate them? The key to re-enchanting the disenchanted China lead-er is to give him a stake in the China opera-tion he put so much sweat into, and to let him know the operation is still important.

Martin, for example, a Danish GM, is thrilled at how his operation is doing in China and the strategic role it will be play-ing in the development of the company globally. As a major shareholder in the China operation, he knows what the lead-ership in the home office is planning for the China operation because the CEO of the company came to China personally for a week to meet customers and to discuss the overall company plan with Martin. Af-terward, they hit the Shanghai nightlife together for an evening neither could re-member. ■


coLUmn • corporAtE trAininG

As the economy recovers, firms are once again looking to recharge em-ployee skills and morale for the road

ahead. But such preparations cost money, and many of our clients have slashed training by 40-50 percent. Some companies have frozen training altogether. Others try to deliver ev-erything internally, which usually means dumping the job on HR personnel who are frequently overworked, unenthusiastic and unqualified to deliver real value in the train-ing room.

The question is, can you deliver similar value from a reduced budget? In most cases, the answer is yes. While training budgets in the past may have been more generous, much of the money was wasted. To illustrate the point, here are a few ways that companies of-ten waste training cash.

Provide training employees don't needIgnoring the needs and expectations of your trainees is a general pitfall. It results from poor vertical communication between levels, as well as poor horizontal communication be-tween HR and other departments. You may find yourself sending a well-trained group of top managers on a skills-based programme, only to find out they actually needed a laid-back session where they could brainstorm. Conversely, mid-managers or frontline peo-ple hungry for guidance and problem-solving tools may complain about the lack of sub-stance at an experience-based session. The solution is to define in detail desired training outcomes and delivery methods.

Ignore staff turnoverLabour in China is a famously volatile re-source, and it is not rare for firms to spend money training for their competition. You can solve this problem by carefully planning where the training content will enter your organisational chart, and how the knowledge

it's time to start training more efficientlyBy Gabor holch

Get back in shape

Gabor holch is a management consultant, trainer and co-founder of campanile Group, a group of business consultancies advising clients on cross-cultural business strategy, leadership and communication. campanile's clients are multinational companies and public institutions in china, southeast Asia and Europe. contact Gabor at: [email protected]

will be shared. If turnover at the bottom of the pyramid is high, train the supervisors, who can share the skills and tools in a trickle-down manner. You may also want to assess the retention value of the training you deliver. As a rule of thumb, customised programmes work better for retention, as the knowledge gained is more specific to the particular job.

Give contradictory messagesLet's say you will deliver Six Sigma, project management and leadership skills courses this year. All of these courses address qual-ity issues, but they approach them from dif-ferent angles. However, if different training programmes use different standards to define and manage quality, the result is confusion. Make sure that each programme delivered follows the same values and guidelines as de-fined in your company's mission statement or strategy.

Leave paid services unusedThis is where I see the greatest amounts of cash going down the drain. Companies are often impressed by the added value that training providers deliver, such as evaluation tools, refresher sessions, feedback reports or support tools like online learning. However, many of these added services are never used. Refresher sessions are forgotten or postponed indefinitely. Participants do not log into their online learning accounts. Forms on feedback results are neatly filed in a box somewhere.

The best approach is to plan realistically and keep participants, training providers and HR accountable for making every penny work for your organisation. Ask yourself the essen-tial questions: Is it a realistic expectation that your busy top managers will log on twice a week and spend 2 hours learning online? If it is, create incentives so that they really do. Simi-larly, if you spend hours collecting and analys-ing feedback, make sure you get the feedback you need, and use it. ■

Food Safety China Enhancing food quality in China

28th of August, Shanghai

In the last year, food safety has become one of the hottest topics in China. With the launch of a new food safety low on June 1, the topic has been given new urgency. How do we enhance food quality, and what kinds of standards should we follow?

China Economic Review has invited specialists from the food safety supervisory authority, as well as leading food industry experts and food industry service providers who possess a unique mainland China perspective on the issues.The conference features an interactive and case-study-oriented panel discussion that will provide valuable knowledge and practical advice on how to maximize company value through food safety and risk assessment.

Speakers includeJ. Chris Harreld, Institute for Business Value, IBMEdison Chen, Ph.D. SBS/Asset Leader, Global Business Service, IBMFDA, ShanghaiProf. Xiaosong Hu, VP. China National Food Industry Association

Who should attendFood safety directors and managers, quality managers, supply chain managers, procurement managers, general managers from all Food and relative industries and all Food and Beverage industry.

RatesEarly Bird Rate (Before August 10): RMB2200/USD327 Standard Rate: RMB2500/USD373

Book Now @ www.chinaeconomicreview.com/conferenceor contact Grace TAN | Tel: +86 (0) 21 5187 9633 * 851Fax: +86 (0) 21 5385 8953Email: [email protected] Economic Review, and its local agent Shanghai Yanran Advertising Ltd

Conference Agenda08:00 - 09:00 Registration

09:00 - 09:15 Opening remarks

09:15 - 10:00 Session I: Food safety major concerns in China • What are the emerging management trends • Developing criteria and objectives

10:00 – 10:30 Session II: Analysis the Food Safety Issues in China• The new methods that help to produce efficiently, safely and more economically

10:30 – 11:00 Tea break

11:00 – 11:45 Session III: Full Value Traceability Food Related Products• A strategic imperative for food related product companies to empower and protect their brands

11:45 – 12:30 Session IV: Business impact of traceability solutions• How to properly use traceability solution in food related industry

12:30 - 14:00 Lunch

14:00 - 14:45 Session V: Develop in Food Safety and how it turn to business growth• What are the new prevention and detection methods that effectively improve food safety in the supply chain• How does training & education can help developing food safety and help business growth

14:45 - 15:30 Session VI: Compliance and impact of China’s food safety law• Complying and keeping updates on Chinese and international regulations

15:30 – 16:00 Afternoon tea

16:00 – 17:00 Session VII: Panel discussion: Case Study in Food Safety • Crisis Management: The efficient way to dealing with Crisis• How do use risk assessment to void safety issue.

17:00 -- 17:10 Closing Remarks

Special Consulting Service Partner

Food Safety China Enhancing food quality in China

28th of August, Shanghai

In the last year, food safety has become one of the hottest topics in China. With the launch of a new food safety low on June 1, the topic has been given new urgency. How do we enhance food quality, and what kinds of standards should we follow?

China Economic Review has invited specialists from the food safety supervisory authority, as well as leading food industry experts and food industry service providers who possess a unique mainland China perspective on the issues.The conference features an interactive and case-study-oriented panel discussion that will provide valuable knowledge and practical advice on how to maximize company value through food safety and risk assessment.

Speakers includeJ. Chris Harreld, Institute for Business Value, IBMEdison Chen, Ph.D. SBS/Asset Leader, Global Business Service, IBMFDA, ShanghaiProf. Xiaosong Hu, VP. China National Food Industry Association

Who should attendFood safety directors and managers, quality managers, supply chain managers, procurement managers, general managers from all Food and relative industries and all Food and Beverage industry.

RatesEarly Bird Rate (Before August 10): RMB2200/USD327 Standard Rate: RMB2500/USD373




09:15 - 10:00 Session I: Food safety major concerns in China • What are the emerging management trends • Developing criteria and objectives

10:00 – 10:30 Session II: Analysis the Food Safety Issues in China• The new methods that help to produce efficiently, safely and more economically

10:30 – 11:00 Tea break

11:00 – 11:45 Session III: Full Value Traceability Food Related Products• A strategic imperative for food related product companies to empower and protect their brands

11:45 – 12:30 Session IV: Business impact of traceability solutions• How to properly use traceability solution in food related industry

12:30 - 14:00 Lunch

14:00 - 14:45 Session V: Develop in Food Safety and how it turn to business growth• What are the new prevention and detection methods that effectively improve food safety in the supply chain• How does training & education can help developing food safety and help business growth

14:45 - 15:30 Session VI: Compliance and impact of China’s food safety law• Complying and keeping updates on Chinese and international regulations

15:30 – 16:00 Afternoon tea

16:00 – 17:00 Session VII: Panel discussion: Case Study in Food Safety • Crisis Management: The efficient way to dealing with Crisis• How do use risk assessment to void safety issue.

17:00 -- 17:10 Closing Remarks

Special Consulting Service Partner


coLUmn • wEALth mAnAGEmEnt

Many expatriates move to China because they and their compa-nies are firm believers in the

future of China and its role in the global economy.

Once on the ground here, expatriates ex-perience the progress and see the dramatic changes firsthand. The level and pace of growth is unprecedented in scale, and many people working here naturally want to invest part of their savings in China to get a bigger piece of the action.

Countless books have been written on the reasons to be optimistic about China's future. Economic liberalisation is spurring massive wealth creation, and some are fore-casting China's economy to overtake the US as the world's largest in less than 20 years. China has a high savings rate, large reserves, and plenty of opportunity.

In addition, the Chinese economy has shown itself to be resilient through dif-ficulties such as the Asian crisis and even

is it time to put your money in chinese markets?By anthony noto

wading in

anthony noto, CFa is a fee-only financial planner at shanghai-based noto financial planning, a division of diacron. noto financial planning provides personal financial planning and investment advice to expatriates living in mainland china and hong Kong

the current debt crisis, with the Shanghai Composite up over 80 percent year to date.

how to investInstitutional investors and high net worth individuals have a wide range of choices for investing in China – such as China-focused private equity funds, hedge funds, venture capital funds and individual stocks.

For the majority of expatriates, however, these investments are unsuitable as they typically have high minimums, poor liquid-ity and/or a very high level of risk. Therefore, low cost mutual funds and Exchange Traded Funds (ETFs) are the best options for most expatriates that would like to invest in Chi-na. An ETF is a security that tracks an index, a commodity or a basket of assets (like an index fund), but trades like a stock on an ex-change.

Ironically, foreign investors that want to invest here are best served by funds based outside China. Hong Kong offers a num-

DUE CAUTION: Expatriates should be wary of investing too much in one market

PTX


ber of China-focused ETFs and is a more mature market than Shanghai or Shenzhen. China-focused ETFs traded in Hong Kong are made up of H-shares and Red Chips.

The difference between H-shares and Red Chips is that H-shares are mainland-registered while Red Chips are not. China-focused funds are also available in Europe.

For example, Deutsche Bank of-fers a FTSE/Xinhua 25 Index ETF in Italy, Germany and Switzerland. Lyxor, a unit of Société Générale, of-fers the China Enterprise Index ETF available in France, Spain, Italy, Ger-many and Switzerland.

how much to investAs a global citizen looking at a global investment environment, determin-ing the proper amount to invest in China should be based on a number of factors.

The current weighting in terms of global market capitalisation is a good starting point to consider in deciding how much to invest in any given coun-try. To put this in perspective, China's weighting in the world markets was 2.1 percent in May 2009 according to S&P. The majority of Chinese shares are still not freely traded.

Aside from technical elements such as China's current weighting in world markets, the proper amount to invest is also based on personal fac-tors such as investor needs and risk tolerance.

For example, an expatriate that plans to retire here might choose to hold more Chinese equities to better address currency risk.

Diversification is another impor-

China-Focused exchange-traded funds listed in hong Kong

Code Fund Name2801 iShares MSCI China Tracker2823 iShares FTSE/Xinhua China 50 Index ETF2827 W.I.S.E. CSI 300 China Tracker2828 Hang Seng H-Share Index ETF2838 Hang Seng FTSE/Xinhua China 25 Index ETF3024 W.I.S.E. SSE 50 China Tracker

tant factor to keep in mind. China's prospects are attractive, but it is im-portant to recognise that it is still an emerging economy with its share of issues to work through, such as its banking system, a massive overhang of state-owned shares, possible com-modity shortages and exposure to in-flation, to name but a few.

Use cautionDespite perceived risks, diversify-ing geographically can lower overall portfolio volatility – particularly as China's economy grows to be less de-pendent on exports. This means that a portfolio that includes Chinese stocks could be less risky than one without such stocks.

Expatriates captivated by the growth occurring around them some-times want to invest a significant por-tion of their savings in China. When deciding to move here, expatriates have already invested their greatest income generating asset in China – themselves. Putting too much sav-ings in Chinese stocks on top of liv-ing and working here leaves income and savings in an unnecessarily vul-nerable position, as they share too many interrelated risks.

As an example of how dangerous this can be, when the American energy company Enron imploded in late 2001, many employees lost their jobs and, at the same time, watched their savings held in company stock collapse.

Diversification is a fundamental principle in growing and maintain-ing personal wealth. Emerging mar-kets like China can be a valuable ad-dition to a portfolio, but expatriates should not get carried away. ■


Revving up

IC

The expansion of the Chinese car market is good for domestic and foreign manufacturers alikeby Mark Andrews

covEr story • AUtoMotIvE


It was only a decade ago private car ownership seemed like a dream for Chinese consumers,

but today the dream has already been realized by much of the Chinese mid-dle class. The explosive growth of car ownership in China led analysts to predict China would soon become the world's largest auto market, and in January they were proven right.

"China's growth has been well ahead of forecast for several years, but nobody expected China to take the lead until sometime in the middle of the next decade," says William Russo, president of Synergistics, a business consultancy specialising in the auto sector. Even allowing for the impact of the downturn in the US, it is still amazing how quickly the Chinese market has grown, he says.

China's unofficial celebration of its new stature was marked by the 13th biennial Shanghai Auto Show

held last April. More than 600,000 people attended the show, many of whom were actually shopping. Jason Shen, for example was a postgradu-ate student looking to buy his first car. "For me it's a family purchase," he said. "If I have a car it is very con-venient for me to take my wife to work, my child to school, and look after my parents."

Solidly middle-class consumers like Shen are the future of the do-mestic car market. Sales in the first half of 2009 amounted to 6.1 million units, compared to 4.8 million in the US. "Since 2003 China's vehicle mar-ket has more than doubled in size from 4.56 million units to 9.67 mil-lion units [in 2008]. Of this total, 61 percent, or 5.91 million units, repre-sent passenger vehicles," says Russo.

This is good news for foreign manufacturers; two-thirds of all pas-senger cars sold in China are

"The Chinese are natural savers and have liquid cash in troubled times, which coupled with government incentives has boosted the Chinese car market ahead of the US" ASH SUTCLIFF, CHINA CAR TIMES

➤➤


produced by foreign brands or their joint ventures.

Around the end of last year the market faltered slightly, but the Chi-nese government stepped in with a plan to aid the industry. The plan aimed to boost the sales of more fuel-efficient vehicles, aid development of domestic brands through R&D and ac-quisitions, and promote electric cars.

Since January 20, taxes on vehi-cles with an engine displacement of 1.6 litres or less have been reduced, along with subsidies for purchase of those of less than 1.3 litres. January and February saw a nearly 19 percent increase in sales of such cars.

"The Chinese are natural sav-ers and have liquid cash in troubled times, which coupled with govern-ment incentives has boosted the Chi-nese car market ahead of the US in sheer volume," argues Ash Sutcliffe, author of the popular China Car Times web site. "This cash behind

them has given car buyers a great amount of room to manoeuvre at the negotiating table."

Foreign attentionIn the past, many foreign manufac-turers used the China market as a place to sell old designs. Sutcliffe points to the Volkswagen Santana, Daihatsu Charade and Austin Mae-stro as examples of models that were produced in China long after they had debuted in other markets. Nev-ertheless, some of these models – the Santana in particular – went on to set sales records.

However, today American, Japa-nese and Korean manufacturers' joint ventures are offering their latest designs on the mainland. Porsche's launched its new Panamera sports saloon at the Shanghai Auto Show, the first time Porsche had launched a new car at a non-European or Ameri-can show.


WORK FASTER: Even as foreign markets decline, Chinese car demand remains robust

➤➤

IC


Manufacturers are also now taking into account Chinese tastes and mod-ifying their products to suit. Ford, for example, launched a saloon version of the popular Fiesta hatchback in China this year designed specifically to appeal to the "real men don't drive hatchbacks" market in China. Audi produced a specially lengthened ver-sion of the A4 for China. Lengthened cars, with their greater rear legroom, are popular here as they can accom-modate larger family units or busi-ness partners.

Another leader has been General Motors. In 2006, GM introduced a Chinese version of the Buick La-Crosse. While based on the archi-tecture of its American namesake, the Chinese model has a completely different body and interior designed in Shanghai. The domestic styling of the LaCrosse was so successful that GM's Shanghai subsidiary is now in charge of redesigning the interior and the exterior for its replacement, to be released later this year in both the US and China.

Volkswagen has also got in on the act, launching the VW Lavida and VW New Bora in China last year. With the recent rumours that VW will end production of the Jetta and

Santana in China by 2012, Volkswa-gen's strategy seems to be targeting China with a mixture of its latest international designs and localised versions.

When it comes to the top end, the near-monopoly enjoyed by foreign brands shows no sign of ending. Gov-ernment officials, leading purchasers of luxury vehicles, no longer exclu-sively purchase Audis, but are also buying Mercedes and BMWs.

But some foreign carmakers are looking to get in on the growing, low-price market as well.

LOCALISED: A prototype on display at the Shanghai Auto Show

➤➤

IC



Italian carmaker Fiat created a joint venture this July with Guang-zhou Automobile Group to produce economy cars for the Chinese mar-ket. Beginning in May 2011, the JV will produce 140,000 cars per year and may increase production up to 250,000 units.

Local prideAt a time when the names of Chi-nese manufacturers are being tossed around as potential purchasers for ailing American and European car brands, local brands made a confi-dent showing at the Shanghai ex-hibition, demonstrating their latest models along with concepts and technology.

However, behind the scenes there has been a shift in perception. The original aim behind the joint ven-tures with foreign manufacturers was to help larger state-owned car-makers to create competitive brands

of their own. With the exception of SAIC, with its Roewe and MG brands – which were acquired, not created – this has yet to happen.

The market leaders in sales by do-mestic companies, Chery, Geely and BYD, are all either private compa-nies or were created by state-owned enterprises (SOEs) not previously involved in car production. Beijing has correspondingly started to bet on domestic leaders like Chery and Geely at the expense of the big SOEs, says John Russell, CEO of Manganese Bronze Holdings, which is currently in a JV with Geely to produce Lon-don-style taxis.

One tangible product of this gov-ernment support is Geely's purchase in March of Australian transmission manufacturer DSI. This acquisition may help Geely overcome a signifi-cant technology challenge. Accord-ing to an executive at Great Wall Mo-tors, gearbox technology is one of the

The market leaders in sales by domestic

companies are all either private

companies or were created by SOEs not

previously involved in car production

AMBITIOUS: A Chang'an concept car on display

➤➤


biggest bottleneck areas for Chinese producers.

Cutting edge?Chinese battery manufacturer BYD last year took the motoring world by surprise with its launch of the F3DM, an electric car which also features a small petrol engine to generate elec-tricity when the charge runs out. The F3DM will hit the showrooms two years before projected launch of the much vaunted electric Chevrolet Volt.

At the Shanghai Auto Show, most of the larger Chinese manufacturers also displayed advanced technology featuring hybrids and electric ve-hicles. Unlike the F3DM, these mod-els are mostly "mild hybrids", which store power during the deceleration phase and then reuse it to help with acceleration.

Chinese government targets call for a production capacity of 500,000 electric and hybrid vehicles a year by the end of 2011.

However, market analysts Frost & Sullivan forecast that actual demand by 2015 will be only 100,000. Russo of Synergistics says that manufactur-ers are still cautious when it comes to hybrids. "There has not been any

strong indication of a movement to produce such vehicles on a large scale."

Sales of hybrids have justified their caution. Chinese sales of the Prius amounted to 899 units during 2008 and so far BYD's F3DM has only been delivered in small num-bers to fleet users.

Even with city and central gov-ernment subsidies to reduce initial costs of purchase, electric vehicles are largely unsuitable for the Chinese market infrastructure. Most people live in apartments without private garages and therefore have nowhere

to hook the car up to the electricity grid in the evenings. These target production levels also assume that the grid can generate enough electric-ity for them in the first place.

Sutcliffe and Russo agree that the technology on display at the auto show was more about creating pub-licity for the manufacturers. When it comes down to it, Chinese consum-ers care about price, says Russo. "The vast majority are looking for an over-all cost-effective mode of transporta-tion, and so what the consumer in China will look for is the total cost of ownership." ■

ADVENTUROUS: The "Detroit Fish", a domestic amphibious prototype


rEGIoNs • HANGZHoU

Silicon paradiseEntrepreneurial Hangzhou is clustering information technologyBy Matt Koon

Hangzhou, capital of Zhejiang province, is trying to brand itself as "Silicon Valley in

Paradise". While it's easy to dismiss this as government hype, the city possesses a similar combination of top talent and entrepreneurial drive that made California's San Fernando Valley a fertile ground for informa-tion-based start-ups. Home to the Al-ibaba Group, a new R&D centre for Netease, and recently tapped by Mi-crosoft as the location for its cloud-computing centre in China, the city is competing to become the preemi-nent hub of the Chinese IT industry.

The city's strategy appears to be paying off. It has already attracted a number of Fortune 500 companies and smaller high-profile firms. Es-timates for revenue from software and service outsourcing reached

€36.6 million in 2008 and optimistic government projections put them at €58.9 million in 2010.

Domestic companies have also benefited. Netease, creator of China's 163.com portal and a number of pop-ular online games, began construc-tion on a €31.39 million facility in the West Lake Soyea Software Park last year, which will house the com-pany's R&D centre for development of online gaming and other internet technologies. It is expected to ulti-mately employ up to 4,000 people.

The Hangzhou modelZhejiang province and Hangzhou in particular are well known for spurn-ing Beijing's state-driven develop-ment model in favour of entrepre-neurial firms. In 2008, Hangzhou had 128,200 private enterprises, employ-

ing 1.24 million people and generat-ing 92 percent of its GDP.

A recent study on technology commercialisation published in the journal Technocation, an internation-al journal of technological innova-tion and management, says that the Hangzhou model is more appropri-ate for most Chinese cities than the traditional university-owned technol-ogy enterprise (UOTE) model, also known as the "Tsinghua Model".

According to the study, entrepre-neurial initiated spin-offs have re-placed the formerly dominant UOTE model for development of technol-ogy enterprises in Hangzhou. The study found that three-quarters of the enterprises surveyed in Hang-zhou were started by one or more individuals and only a quarter by the government or the universities.

WELCOME ABOARD: Hangzhou is rated as one of the best cities for foreign businesses

PTX


In Beijing, on the other hand, nearly half of start-up enterprises had insti-tutional origins.

"Spin-off activity in Hangzhou is much more oriented toward market opportunities and the profit interest of individual researchers," the au-thors claim. Tsinghua, on the other hand, benefits from being the lead-ing national technical university and well-connected in Beijing, they say. Outside of Tsinghua, other Chinese institutions are hard-pressed to se-cure similar financial and human resources.

"The private sector here is very powerful," says He Baili, secretary in chief of the international relations department at the China Council for the Promotion of International Trade (CCPIT) in Hangzhou. "This has been very important for helping IT companies to develop." However, He notes that the local government is in-

volved, dedicating funds to support-ing the sector's development using economic incentives and preferential treatment for IT companies settling in its development zones and soft-ware parks.

The Hangzhou government also provides technical assistance. It recently announced that it will be working with the Ministry of Commerce to implement quality training and certification in Capa-bility Maturity Model Integration (CMMI) for software engineering and organisational development and implement ISO27000 standards for information security manage-ment systems.

"Government departments turn to us for research, comments and suggestions," says Tao Ran, director of public relations for the Alibaba Group. According to Tao, the city government consulted Alibaba when

formulating its 11th five-year plan for the development of information based industry and e-commerce in the city.

Widening appealThe Hangzhou government is also motivated to develop IT firms for environmental reasons.

As one of China's top tourist des-tinations, Hangzhou is keen to push development toward high-tech in-dustries that won't darken its skies. "Information-based industries are friendly to the environment, unlike heavy industry," says He. "The gov-ernment is particularly interested in IT service industries as a way to gen-erate revenue without harming the environment."

While this ignores the fact that an industry fuelled by coal-fired power and outmoded hardware generates massive amounts of waste, ➤➤


rEGIoNs • HANGZHoU

these are problems that can be ex-ported outside the municipality.

Brain powerAnother charm is intellectual pro-ductivity. Almost half of Hangzhou's 130,000 software and IT industry employees are engaged in R&D. Last year in Hangzhou, there were 18,549 patent applications and 9,831 patents granted, a year-on-year increase of 39.6 percent and 29.8 percent, respec-tively, many produced in the city's 473 R&D centres.

Hangzhou also has a 191,000 square metre incubator space housing 190 new companies. Many of these patents are channelled into spin-offs and start-up companies.

The academic environment also helps. "In terms of information and communication technology capabili-ties, you have leading universities like Zhejiang University – number three in China – and a very active high-tech development zone," says Paul Wills of UK Trade and Invest-ment (UKTI).

He explains that although Hang-zhou is already home to a number of companies that have already emerged as major players, UK com-panies hope to connect with those that will carry on expanding over the next five to ten years.

With this in mind, UKTI led a trade mission to the city in July, bringing Amino, ARM, BT, Bunny-foot Asia, Innovision, NDS, Sondrel, Sony Ericsson, UMU and Vodaphone to meet with the Hangzhou govern-ment and local companies.

Such developments have not been lost on analysts and industry watchers. In 2008, the city was named the best place to do business in China for a fifth consecutive year by Forbes, came in first in China for the ease of doing busi-ness in a study by the World Bank, and was selected as one of 31 global cities for IT development by KPMG.

Not the Only PlayerAccording to the Technovation study, the Hangzhou model for success – vi-brant private companies and top tal-ent – is extensible to other cities and could become the dominant model for high-tech commercialisation in China. Hangzhou is already facing competition from its sister cities in the Yangtze River Delta and isn't the only one to watch.

For one thing, while Hangzhou may be an attractive destination for big players, overseas small- to me-dium-sized enterprises from abroad may have a harder time operating there. Unlike most other second-tier cities, Hangzhou lacks substantial in-

formation on investment for overseas businesses. The majority of available information is in Chinese; when con-tacted by EuroBiz, the Hangzhou Mu-nicipal Foreign Trade and Economic Cooperation Bureau had no English-speaking staff available by phone.

While Microsoft chose Hangzhou for its cloud-computing centre, it was after two heavyweights, IBM and Al-ibaba, had already decided on other locations for similar ventures. IBM chose Wuxi for its centre and Aliba-ba chose Nanjing.

Tao of Alibaba explains that the company chose Nanjing because of the city's abundance of privately owned SMEs involved in e-commerce, the presence of Nanjing and South-east University, a skilled labour pool and a developed IT sector. The soft-ware industry accounts for one-third of Nanjing's GDP, he says.

With cities competing for projects, will companies benefit from incentive bidding wars? Tao says no. "Integra-tion is the general trend in the Yang-tze River Delta. Nanjing and Hang-zhou should complement each other and strengthen cooperation."

The Hangzhou model, however, seems more about competition be-tween firms than cooperation between governments, which is why so many firms are there in the first place. ■

HAPPY TO BE HERE: Microsoft drums up business in Hangzhou

➤➤

IC


The Jian Lake Golf Club is situ-ated about 50 kilometres east of Hangzhou, capital of Zheji-

ang province, on the outskirts of Sha-oxing. This 18-hole JPM Golf Design Group creation has a pristine location on the south banks of Jian Lake.

It is also part of the "AAAA-level" Keyan Tourism and Holiday Resort in Keqiao, providing a rare escape into nature from the nearby urban jungle.

The 7,435-yard, par-72 layout is spectacular from the start with a view of the nearby mountains and an abun-dance of water that comes into play in some form on 15 holes. The course starts with a friendly but lengthy 598-yard dogleg right where the main ob-stacles are the bunkering.

However, the standouts are the three holes sitting to the left along Jian Lake starting at the 399-yard, par-four 15th. The 16th, a 512-yard par-five, is an excellent birdie op-portunity for average golfers as it measures only 428 yards from the white tees. To be rewarded, a player will have to navigate more than 150 yards of water off the tee and avoid the six bunkers up the right before reaching the green.

The picturesque par-three 17th is long at 257 yards, but its magnificent setting at the base of a hill provides the inspiration here in this bowl-like setting. While there is a bit of bail out area at right, the required shot must cross water to hit the long, skinny

Diamond in the roughEnjoying the view at the Jian Lake Golf club in ZhejiangBy Ty Webb

LIFE • GoLF

green fortified by three bunkers at the back.

This memorable golf experience ends with an excellent risk/reward hole in a 568-yard, par-five where water cuts across the fairway of this dogleg left twice before the green.

Adding to the challenge on the ap-proach are the rocks to the left of the green that are best to stay clear of to avoid a potentially disastrous rico-chet.

Jian Lake is currently selling mem-berships for RMB500,000 (€51,570) but also offers a visitors day on Wednesday for RMB800 – the price includes green fee, caddie and elec-tric cart. ■


LIFE • DrINKING

Tapped outIs it last call for china's brewpub industry?By Orlando Crowcroft

Texan brewer Gary Heynes talks about making beer with the tone of a kid who has just

been given his own candy store.And when he's not talking about

biological formulas, the merits of live versus dry yeast and the sun-soaked hillsides of the Sierra Nevada region in California – apparently where the best beer-making ingredients in the world can be found – Heynes is silently watching customers in the Boxing Cat Brewery, his Shanghai brewpub, raise their glasses and sample his signature Wild Mild, a cool, chocolate-tinged ale that won him a gold medal in 1996.

Given the success of the Boxing Cat and the popularity of his brews, Heynes is optimistic about the fu-ture of craft beer in China. This op-timism is not, however, universal.

Micro-breweries, and their fellow traveller brewpubs (bars that brew and serve their own beer) arouse pas-sion wherever they are, particularly in America and the UK, where the pressure group Campaign for Real Ale (CAMRA) is run with the vigour of a military unit. But unfortunately, the Chinese experience has been less disciplined.

Gold rushIn China, micro-breweries – catego-rised as those that produce less than 500,000 gallons per year – first arrived in 1992, when German beer giant Pau-laner Bräuhaus opened its first bar in central Beijing. Fifteen years later, the company has brewpubs in all China's major cities, as well as in Sanya, Wuxi and Nanjing. Paulaner Bräuhaus was not the only company to cash in. The industry boomed in the capital dur-

ing the 1990s, and by 1999 there were an estimated 50 micro-breweries in the city, with others springing up in Hong Kong and Shanghai.

But less optimistic old brewing hands in China are quick to point out that few of the bars that set up shop in the mid- to late-90s are still open. Shanghai brew-master Rene Schwichtenberg, head brewer at Paulaner, explains that as far as he is concerned, the micro-brew boom is over.

"Most of those bars in Beijing were really, really small and have since shut down. Everyone thought they could open a micro-brewery and make a fortune, but they soon learned that that is not the case," Sch-wichtenberg said.

Key to persuading people to part with upwards of RMB50 for a pint of beer, Schwichtenberg says, is giv-ing them the whole package – good

beer, good atmosphere and top-class service. The new brewpubs that tried to copy the bigger companies in the 90s could not, or didn't want to, put in enough effort.

"You have to bring these people in. The whole package must be right and this is what the people don't un-derstand," he said.

But even if brewing and selling your own beer is not the cash cow that many believed it to be, compa-nies that manufacture micro-brewing equipment are still doing well. Jinan Deyu, a Shandong-based company that produces micro-brewing equip-ment, still sells around 40 full micro-brewing set-ups a year.

Jinan Deyu's spokesman, surnamed An, explained that while some of its micro-brewing equipment is sold over-seas, most of its customers are domes-tic brewers.

"Our customers are mainly bar

ISTO

CK


Tapped out owners and some small beer facto-ries, but it's not only foreign-run bars that are buying micro-brewing equipment – local ones buy them too."

One such bar is Beijing's OKB, a small brewpub that has become something of a Beijing institution since opening its doors in 2006. Man-ager Liu explained that although the bar has a large Western crowd, around two-thirds of its customers are Chinese and Japanese.

"Microbrewed beer has a bet-ter taste, and more importantly it is healthy. So it's no wonder that peo-ple – foreign or otherwise – choose it," Liu said.

In a country where bureaucracy seems to pervade all areas of life, one would expect micro-brewing to require its fair share of form-fill-ing, fee-paying and, of course, palm-greasing. But the reality, Paulaner's

Schwichtenberg explains, is that starting a micro-brewery requires little additional paperwork than starting a bar.

"For brewing, it's quite easy, I don't think you have a problem," he said.

Gary Heynes agrees that the big-gest cost of brewing is not jumping through legal loopholes; it's equip-ment, management and expertise.

"It's a bigger expenditure in terms of equipment, and you also have to get someone who knows what they are doing to run it," he said.

While hops and malt are easy to import into the country, brewers can have problems sourcing live yeast. China still forbids the import of live yeast, and while bigger companies like Paulaner simply use dried yeast instead, smaller brewers have to re-sort to smuggling it into the country in suitcases.

Heynes agrees with Schwichten-berg about the merits of many Chi-nese brewers. He believes that local brewers, as well as many of those from other Asian countries like Ko-rea and Japan, have proven time and time again that making beer is not their strong point.

'They are too willing to cut cor-ners and often they're just winging it. Often they're just feeling their way through the darkness," he said.

But Heynes –who makes around 4,000 litres of beer a week – says that China's thirst for real ale is nowhere near being quenched, and while short of talent, the country's micro-brewing industry will never be short of customers.

"Chinese people are wanting bet-ter things nowadays. They want bet-ter food, better bread and better cof-fee. They're going to want better beer too," he said. ■

Oakwood takes you homeLocated on Jiaogong Road,

linked to the architecturally stunning Europe America

Center in the ancient capital of Hang-zhou, Oakwood Residence Hang-zhou's 166-room serviced apartment complex houses a luxurious kaleido-scope of amenities, facilities and ac-tivities to inspire any business trav-eler or family. Oakwood Residence Hangzhou's aim is to create a wealth of home comforts for travelers and residents while on tour or relocating for business or leisure.

Choose between 9 floors of 46 stu-dios, 85 one-bedroom apartments, 26 two-bedroom apartments, and 9 three-bedroom apartments, all com-plimented with provisions and ser-vices which accommodate the needs of individuals and families alike. A trusted and well trained team of service staff is available 24 hours a

day, hosting an executive area, a resi-dents' lounge and bar, the Genesis business center, state-of-the-art fit-ness center, indoor swimming pool, daily maid and room service, and a public area WiFi facility, you can truly appreciate the ease of serviced living. The furnished apartments fea-ture fully equipped kitchens, washer/dryer, high-speed broadband inter-net and more, all aimed at ensuring a comfortable, convenient Oakwood experience. An Oakwood apartment is not just a space for "staying" but

actually a space for "living". The opening of this property fur-

ther demonstrates the exceptional brand growth of Oakwood in Asia Pacific, with 9 serviced apartments having opened in the space of slightly more than two years. Oakwood Resi-dence Hangzhou is one of Oakwood's 12 properties that are part of the company's expansion plans, which will increase Oakwood's portfolio to around 2,500 apartments in five cities in China by 2012. Oakwood already manages properties in Beijing and Guangzhou.

Oakwood Residence HangzhouAddress: No. 28 Jiaogong Road,

Hangzhou, 310012, ChinaTel: +86 (571)8899 3131

Fax: +86 (571) 8899 3030Email: reserve.reshangzhou@

oakwoodasia.com

oFFErING


coPUBLIsHED ArtIcLE

CreAtive vAlue

It's easy to tell Yew Chung Inter-national School of Shanghai has a vigorous visual arts program.

Whole corridors of the school are fes-tooned with paintings, photography, and snaps of students at events like the Wearable Arts Show. Some areas of the school have been taken over by students and made into semi-perma-nent installations.

While it's hardly surprising that the school would be willing to dis-play the work of its students, what is impressive is that YCIS's high opin-ion of its young artists is apparently shared by people who are willing to put their money where their mouths are – namely admissions officers and scholarship committees. "In the last two years, our students have re-ceived over US$1 million [€702,600]

in scholarships to top programmes in the US, the UK and Canada," says Daun Yorke, art subject area leader and IB coordinator at YCIS. In 2009, a Year 13 student was offered a schol-arship worth nearly US$100,000 to attend the world-renowned Savan-nah School of Art and Design, which she declined in order to accept an-other scholarship to the also-world-renowned School Of Art Institute of Chicago. All told, the student was of-fered $350,000 in scholarships.

Is there something in the water? Perhaps, but it's more likely the hard work and critical feedback the program delivers its students. Artist-in-residence Luke Homitsky points out that the YCIS arts program is not self-esteem therapy. Last year, for example, YCIS students had the

At yew chung International school of shanghai, the visual arts pro-gramme rewards passion and discipline

opportunity to show their work at the Red Gate Gallery in the Shang-hai Sculpture Park, but this did not mean that whatever students sub-mitted was accepted. Homitsky be-lieves rejection is good preparation. "You have to learn to deal with the fact that all your pieces might not be good enough to be in the show. So you get a taste of self-critique and you learn how to take constructive criticism from others."

The short-term pain appears to produce long-term gain. Student Naomi Yorke is emphatic in crediting the YCIS experience for her ability to get into top programs – and she be-lieves she started ahead of the game. "I didn't realise the full impact of this program and my post-secondary edu-cation until I started university," she

DRESSING THE PART: YCIS art programme graduates strike a pose


says. "Many of my fresh-out-of-high-school peers were drawing unicorns and making 'nice art,' and many had a really dated idea about what art is. At YCIS, on the other hand, we had already engaged in really intense cri-tiques and we were learning about contemporary art and artists. I found out when I got to art school that this was a really unusual approach. It re-ally sets you apart when you arrive at university!"

The benefit is not restricted to those who go on to study art in uni-versity, however. YCIS isn't just teaching students how to create art, but how to understand what art is and how it affects people and soci-ety. The program is, therefore, re-search-intensive, focusing not just on historical figures but on current movements and personalities in the art world today. "They're not just looking at Picasso and Rembrandt, they're looking at living Chinese art-ists," says Yorke.

"They're going to have a better un-derstanding of art," adds Homitsky. "They'll enjoy it more and appreciate it more. Even if they don't go into the arts as a career, they'll be able to do better than say 'This looks cool, this doesn't look cool.'"

Not only that, but the program is

a strong introduction to the cutting edge of Chinese culture and society. "We go to 798 during the Art Bei-jing festival, which is basically the big Beijing show," says Homitsky. "The students get to stay at the Cen-tral Academy of Fine Arts while we take them to the exhibitions. They get to do studio visits and they get to ask questions. They're getting to do things most 17-years-olds don't get to do, looking at artists most 17-year-olds don't get to look at."

Perhaps the separation between doing art professionally and enjoying it passively is a bit artificial. After all, YCIS requires younger students to

take art because it develops them cre-atively and cognitively, not because it will turn them into professional artists or improve their cocktail con-versation.

"In today's modern economy, creativity, innovation and critical thinking are the prerequisites for leadership, and such skills are in high demand," says Dr Christian Barkei, co-principal of YCIS Shang-hai. "And yet how can students be innovative if they've never been taught to create? At YCIS, we be-lieve that the creative thinking imparted by our arts programmes translates into creativity across the board. For the globally minded citizens of the future, this creativity and open-mindedness is essential for their success."

Puxi Campuses Hongqiao, Kindergarden K1-Y4

(1-8 years old)6242-3243

Gubei, Y5-Y13 (9-18 years old)6219-5910

Pudong Campuses

Regency Park, Kindergarten K2-Y3 (2-7 years old)

5033-1900Century Park, Y4-Y11

(8-15 years old) 5045 6475

[email protected] www.ycis-sh.comARTISTIC LICENSE: Advertising the 2009 graduate art show


oFFErING

HRS: A money-saving choice

In June, Siemens signed a service agreement with HRS.com (Hotel Reservation Service) for HRS to

become Siemens' official hotel book-ing service provider. What made the prestigious electronics and home ap-pliance manufacturer choose HRS, a Germany-based electronic hotel booking system?

HRS was established in 1972 in Cologne, Germany. In 37 years, it has become a leading global electronic hotel reservation system that has 7.2 million unique users and with about 75 million visits per year.

The website provides private and business travellers with more than 230,000 hotels of different categories in more than 180 countries.

Many corporations also benefit from HRS's special room rates in every price range. About 14,000 partner hotels offer HRS corpo-rate rates with up to 30 percent discounts exclusively reserved for HRS business clients.

Clients are connected to HRS through a dedicated and custom-ised website. On this website, cli-ents can get their own corporate negotiated rates with the HRS "guaranteed best buy". This assures the best rate possible at the time of the booking.

Hotel spending is very fragment-ed and generally goes through many different reservation channels, mak-ing it difficult for corporations to

control. Using an online booking system like HRS will make a huge difference.

HRS's corporate client IKEA, for example, went from offline to online through HRS, and IKEA'S average hotel room rate was reduced by 37 percent, about €30 per room.

Another company, Linde, also saw its average room rate reduced by 39 percent after it switched to HRS for hotel booking. Unlike other travel management companies that normally charge corporate clients for their services, the HRS system is totally free for corporations and does not have any transaction or management fees.

Visit us at www.hrs.com.

HRS: A money-saving choice China Plug in Hybrid Electric Vehicle Forum, 2009

Being Fuel efficienct and energy-savingAugust 26, 2009, Shanghai

Despite the obvious economic crises faced by many automakers, 2009 has also been a year of innovative firsts finally being brought to the mass market. China automaker BYD Auto’s plug-in hybrid electric vehicle, the F3DM, is now on sale in the market. Many other automakers, including General Motors and Toyota, have been working on plug-in electric vehicles for mass production.

China Economic Review’s Plug in Hybrid Electric Vehicle event provides a possibility to present and discuss about developments in the field of Plug in Hybrid Electric Vehicle with attendees coming from Automotive industry. The Conference is a show window, where up-to-date research activities and products are presented with increasingly large industrial participation and enhancing exchanges between academia and industry. You will be able to exchange scientific ideas, obtain information about new developments, extend your business activities and confirm Partnership by attending this Forum.

Who should attendAuto makers, Auto Parts manufacturers, suppliers, Outsourced manufacturers, Logistics and transportation service providers, Supply chain management solution providers, Auto-Distributors

RatesEarly Bird Rate RMB 2200 / US$327(before August 10)Standard Rate RMB 2500 / US$373



09:05 - 09:45 Session I: Market: China light vehicle market for electric-drive vehicles (hybrids and plug-ins), production volumes• Estimates on market take-up• Factors affecting the market

09:45 - 10:30 Session II: Latest Manufacturing Technology and Application of Hybrid-Electric Vehicles

10:30 - 10:55 Tea break

10:55 - 11:40 Session III: An planning standard for Hybrid-Electric Vehicles

11:40 - 12:30 Session IV: Panel Discussion- The advantage of pitfalls of electric-drive / Hybrid vehicles

12:30 - 14:00 Lunch

14:00 - 14:45 Session V: Infrastructure: Electric charging station for electric-drive vehicles• Improving the charging equipment at home• The development plan of Electric charging station across China• How to get a bite from the Infrastructure construction

14:45 - 15:30 Session VI: The development of electric-drive vehicles auto parts

15:30 - 17:00 B2B Networking



EuropEan ChambEr offiCE TEam

Shanghai officeGeneral Manager: Derval UsherTel: 021 6385 2023, 6385 2133

Fax: 021 6385 2381E-mail: [email protected]

beijing officeGeneral Manager: Adam Dunnett

Tel: 010 6462 2066 Fax: 010 6462 2067

E-mail: [email protected]

Shenyang officeGeneral Manager: Sierra Wang


pearl river Delta officeGeneral Manager: Francine

HadjisotiriouTel: 020 8758 0479Fax: 020 6121 1006


ExECuTivE CommiTTEE of ThE EuropEan ChambEr

TreasurerMichael Fredskov

ChristiansenNovozymes

States RepresentativeEnrico Perlo

Guala Closures

Vice PresidentBrice Koch

ABB

ChEngDu boarD

PresidentJoerg Wuttke

BASF

States RepresentativeRichard Mohr

Eastinfo

Vice President Jacques de Boisséson

Total

Vice President (Shanghai Chairman)

Ho Kiam KongPhilips

States RepresentativeAndreas Feege

KPMG

CHAMBER BoARD

Tianjin officeGeneral Manager: Kitty WangE-mail: [email protected]

Vice PresidentLyn Kok

Standard Chartered

ChairmanPaul Sives

Proton

Franck Naulleau Intercontinental Hotel Chongqing

oliver HickfangAllianz

Member*Paul Sives

Proton

Arnaud DupontCarrefour

Member*Laurence Barron

Airbus

Member*Hans Marxen

BASF-YPC

Member*Alberto VettorettiDezan Shira & Associates

Chengdu officeGeneral Manager: Yue Zhou

Tel: 028 8671 0577Fax: 028 8666 5844


nanjing officeGeneral Manager: Dominic Phinn

Tel: 025 8362 7330 Fax: 025 8362 7331


*Local Board

observerMiguel Ceballos BaronEuropean Delegation

Tian GangVeolia Water Chengdu

Secretary General: Dirk Moens

Ioana Kraft National Director, Govern-

ment Affairs

Anthony Chau KPMG


pEarl rivEr DElTa boarD

Walid Bendenia Sagem

Communication

Carl-Ludwig Doerwald DKV Insurance

Nico BeilharzLufthansa

Tianjin boarD

Chairman Eric Bouteiller

Ipsen

Gabriele CastaldiGoglio

Hermann Georg KleinodSiemens Electrical Drives

ShEnyang boarD

Gary ScheideMichelin Shenyang Tire

nanjing boarD

ChairmanHans Marxen

BASF-YPC

Christophe LaurasSofitel Galaxy

Koen Verniersoiltanking Nanjing

Carlo D'AndreaPicozzi & Morigi

Li Dongjie Lufthansa

ChairmanAlberto Vettoretti

Dezan Shira & Associates

Xiaobai WangSIMENS Ltd.

Alvaro RautenbergKempinski

Charles-Edouard Bouee

Roland Berger

Marco MarazziBaker & McKenzie

Piter de JongING Bank

Vivian Desmonts DS Avocats

ShanghaiboarD

ChairmanHo Kiam Kong

Philips

Marcus WassmuthLandesbank Baden-

Wurttemberg

Dr. Stefan SackVoith Industrial Services

Chairman Sven Kunath

Jinbei Johnson Controls

Hans KroeppeltBMW Brilliance

Bob GibsonHeng An Insurance

Dr Dahai YuEvonik


ADVISoRY CoUNCIL

The European Union Chamber of Commerce in China is driven and funded by its members. The 27 members of the Advisory Council are particularly active in representing and advising the Chamber, and make an enhanced contribution to the Chamber's funding.

The Advisory Council of the European Chamber


americannaked CowUnit 2, Lane 66, Danshui Lu,near Jinling Xi LuTel: (021) 6385 8123KabbXintiandi 181 Taicang Lu, near Madang Lu Tel: (021) 3307 0798arch Two115 Changshu Lu, near Changle LuTel: (021) 5403 2125Element freshUnit 112, 1376 Nanjing Xi Lu, Shanghai CenterTel: (021) 6279 8682WagasLG12A, CITIC Square, 1168 Nanjing Xi Lu, basement levelTel: (021) 5292 5228blue frog1/F, 27 Super Brand Mall, 168 Lujiazui Xi Lu, PudongTel: (021) 5407 3488Daning Life Hub, 102-103A, Block 6, 1918 Gonghe Xin LuTel: (021) 6631 3920

Chineseguilin gardenChinese Classic Teahouse & Restaurant Where you'll get the best experience.188 Caobao LuTel: (021) 6451 5098 www.guilingarden.comTian Di restaurant6 Zhongshan Dong Luon the Bund Tel: (021) 6329 7333www.tiandigroup.cn12211221 Yan'an Xi Lu, near Panyu Lu Tel: (021) 6213 6585Crystal jade House 6-7, South Block Xintiandi, near Madang Lu Tel: (021) 6385 8752B1, 300 Huaihai Zhong Lu, near Madang LuTel: (021) 6335 41887/F West Gate Mall, 1038 Nanjing Xi Lu, near Jiangnin LuTel: (021) 5228 1133

hotelSky fortune boutique hotel Shanghai358 Hongxu Lu Tel: (021) 3405 9898www.skyfortunehotel.comyahsin business hotelUnit 6, 151 Shibocun Lu, PudongTel: (021) 3842 4949www.volgroup.com.cn

Cantonesebi feng Tang175 Changle LuTel: (021) 6467 06281/F Golden Magnolia Plaza, 1 Dapu LuTel: (021) 5396 13281333 Nanjing Xi LuTel: (021) 6279 0738

Wan hao Chinese restaurant39/F, 399 Nanjing Xi Lu, Tomorrow Plaza, near Huangpi Bei LuTel: (021) 5359 4969yuan yuan (xuhui)201 Xingguo Lu, near Tai'an LuTel: (021) 6433 9123Zen3/F Hong Kong Plaza, 283 Huaihai Zhong LuTel: (021) 6390 6390Unit 2, South Block, Xintiandi,123 Xingye LuTel: (021) 6385 6385

italianbella napoli140 Xikang Lu, near Beijing Xi Lu, nearby Plaza 66 and PortmanTel: (021) 6253 8358Cameo italian restaurant & bar5/F, 392 Tianping Lu, Xujiahui, near Hengshan LuTel: (021) 6448 4678Casanova913 Julu Lu, near Changshu LuTel: (021) 5403 4528Da marco103 Dongzhu'anbang LuTel: (021) 6210449562 Yandang Lu, near Huaihai Zhong LuTel: (021) 6385 5998isola bellaUnit 41, 2/F, Lane 816 Huai Hai Zhong Lu, near Maoming Nan LuTel: (021) 5467 0170ad Domus200 Yan'an Xi LuTel: (021) 6248 8499amichi2/F, 1116 Yan An Xi Lu The Regent ShanghaiTel: (021) 6115 9624

french

Epicvre98 Xinle LuTel: (021) 5404 7719116 Nanchang LuTel: (021) 5306 8365Club Shanghai4/F Shanghai Concert Hall, 523 Yan'an Dong Lu, near Xizang LuTel: (021) 5383 9989Des lys178 Xinle Lu, near Donghu LuTel: (021) 6291 0273la maisonUnit 1, House 23, North Block, Xintiandi,

Lane 181 Taicang Lu, near Madang LuTel: (021) 3307 1010la Seine8 Ji'nan LuTel: (021) 6384 3722la villa rouge811 Hengshan Lu, inside Xujiahui Park, near Wang Ping LuTel: (021) 6431 9811le bouchon1455 Wuding Xi Lu, near Jiangsu LuTel: 021 6225 7088

indianbukhara grill3729 Hongmei Lu, near Yan'an LuTel: (021) 6446 8800Delhi DarbarUnit 5, 3338 Hongmei Lu near Yan'an LuTel: (021) 6465 8366hazaraBuilding 4, 118 Ruijin Er Lu, near Fuxing LuTel: (021) 6466 4328imperial indian KitchenUnit 4, 600 Lantian Lu, PudongTel: (021) 5030 2005indian Kitchen572 Yongjia LuTel: (021) 5465 1951Unit 8, 3911 Hongmei Lu, near Yan'an Xi LuTel: (021) 6261 0377480 Minsheng Lu, near Pudong Da DaoTel: (021) 5821 9875indian vintage76 Tongren Lu, near Yan'an LuTel: (021) 6247 0140masala art397 Dagu Lu, near Chong Qing LuTel: (021) 6327 3571patiala pearl india's restaurantUnit 3, 418 Wuyi Lu, near Dingxi LuTel: (021) 6211 6479punjabi102 Xiangyang Lu, near Nanchang LuTel: (021) 6472 5464Salaam namaste - flavour of india634 Baole Lu, near Jinfeng LuTel: (021) 6221 7151vedas550 Jianguo Xi Lu by Wulumuqi LuTel: (021) 6445 8100

ThaiEl Wajh - moroccan CuisineBuilding 4, 118 Ruijin Er Lu Tel: (021) 6466 43281800 Jinke Lu, Dong Jiao State Guest Hotel, PudongTel: (021) 5027 8261www.facebars.comSpanishla verbenaUnit E, Binjiang Bei Dadao, Lujiazui, Pudong

(Near Int'l Convention Centre)Tel: (021) 5878 9837www.laverbena.com.cn

japanesemoonsha Teppanyaki view restaurant3/F, 5 on the BundTel: (021) 6323 1117www.moonsha.netnadaman2/F, Tower 2Pudong Shangri-La33 Fucheng LuTel: (021) 6882 8888 x260ninniku-ya garlic & Spicy433 Changle Lu, near Xiangyang Lu Tel: (021) 5404 1164

Kagen Teppanyaki28D Taojiang Lu Tel: (021) 6433 3232

haiku by hatsune28B Taojiang Lu Tel: (021) 6445 0021

Sushi inc.2/F,Citigroup Tower Tel: (021) 5877 6551golden Elephant338 Zizhong Lu, South end of Xintiandi, near Huangpi Nan LuTel: (021) 5383 8338la na ThaiBuilding 4, Ruijin Guesthouse, 118 Ruijin Lu Tel: (021) 6466 4328

CHINA DINING

Shanghai 上海


americanThe american Café1/F, Blue Castle Apartments (behind Evolution Fitness)3 Xi Dawang Lu, Chaoyang Tel: (010) 8599 7428/29The astor grill3/F, St Regis Hotel Apartments, 21 Jianguomenwai Dajie, Chaoyang Tel: (010) 6460 6688 x2637Chef TooChaoyang Gongyuan Xi Lu (north of the original Goose and Duck), Chaoyang Tel: (010) 6591 8676Eudora Station bar and restaurant6 Fangyuan Xi Lu, Chaoyang Tel: (010) 6437 8331grandma's Kitchen11A Xiushui Nanjie, Jianguomenwai, Chaoyang Tel: (010) 6503 2893 Unit 103 Building BJianwai Soho39 Dongsanhuan Zhong Lu, Chaoyang Tel: (010) 5869 3055/305647-2 Nanchizi Dajie,Dongcheng Tel: (010) 6528 2790The grillRadisson SAS Hotel Beijing6A Beisanhuan Dong Lu,Chaoyang Tel: (010) 5922 3388hard rock Café1/F, Landmark Towers8 Dongsanhuan Bei Lu,Chaoyang Tel: (010) 6590 6688 x2571Houshayu, Shunyi Tel: (010) 8046 5448Steak & EggsXiushui Nanjie, JianguomenwaiTel: (010) 6592 8088yinyue Ciba 25 Dafosi Dong Jie, Dongcheng Tel: (010) 8401 1838Tim's Texas roadhouse 27 Super Bar Street, Nuren JieTel: (010) 6461 1141outback Steakhouse1/F, Beijing Hotel,east side of Tower A,Dongcheng Tel: (010) 6528 2858Inside north gate of Workers' Stadium,Chaoyang Tel: (010) 6506 5166

Cantonesebeijing ah yat abalone restaurantJinzhiqiao Mansion, A1 Jianguomenwai Dajie,Chaoyang Tel: (010) 6508 9613Chao fu Cheng108 Jianguo Lu, ChaoyangTel: (010) 6566 9936

monsoonInterContinental Hotel 11 Financial Street,XichengTel: (010) 5852 5888Shang palaceShangri-La Hotel,29 Zizhuyuan Lu Tel: (010) 6841 2211

ChineseTian Di restaurant140 Nanchizi Jie Tel: (010) 8511 5556/5557www.tiandigroup.cn

beijingSummer palace2/F,China World Hotel1 Jianguomenwai Dadao, ChaoyangTel: (010) 6505 2266 ext 34

frenchbleu marine5 Guanghua Xili, South of Mexican Wave, Chaoyang Tel: (010) 6500 6704

EuropeanW Dine & Wine22-1 Dongzhimenwai Dajie, DongchengTel: (010) 6416 9838

germanDer landgraf2A Pufang Lu, FangzhuangTel: (010) 6768 2664Die KochmutzenUnit 718, Bldg 7, Jianwai Soho, 39 Dongsanhuan Zhong Lu Tel: (010) 5869 3830

hotelhilton hotel beijing1 Dong Fang Lu, Dongsanhuan Bei Lu, ChaoyangTel: (010) 5865 5000Fax: (010) 5865 5800bƒ[email protected] www.beijing.hiltoncomCourtyard by marriott beijing northeastcourtyardbeijingnortheast.com101 Jingshun Lu, ChaoyangTel: (010) 5907 6666Fax: (010) 5907 6668Crowne plaza hotel beijing 48 Wangfujing Dajie Tel: (010) 5911 9999 Fax: (010) 5911 9998www.crowneplazabj.com

italianSophia'sThe Presidential Beijing9 Fuchengmenwai Lu, XichengTel: (010) 5858 5588

indianindian Courtyard3 Kaifa Jie, Xi Baixinzhuang, Houshayu, Shunyi Tel: (010) 8046 2884mirch masala 60 Nanluogu Xiang,

Beijing 北京

To have your restaurant featured in these pages, please contact one of our representatives at (021) 5385 9063

DongchengTel: (010) 6406 4347The Tandoor1/F, Great Dragon Hotel, 2 Gongti Beilu, Chaoyang Tel: (010) 6597 2211

italian+39 italian restaurant and lounge6 Beisihuan Dong Lu, (southeast corner of Wangjing Qiao, directly across from Ikea), ChaoyangTel: (010) 8457 2839agrilandiaBaigezhuangcun, Mapozhen, Shunyi Tel: (010) 6940 7650Capone's4/F, Bldg A, The Place9 Guanghua Lu, Chaoyang Tel: (010) 6587 1526CepeRitz-Carlton Beijing1 Jinchengfang Dong JieJinrong Jie, Xicheng Tel: (010) 6601 6666Daccapo2/F, Grand Hyatt Beijing Hotel, oriental Plaza, 1 Dongchang'an Jie, Dongcheng Tel: (010) 6510 9628luce Café138 Jiu Gulou Dajie, XichengTel: (010) 8402 4417Serafino pizzeriaXiushui 2, 14 Dongdaqiao Lu, ChaoyangTel: (010) 8799 3938

japaneseajitokuUnit B113, Bldg C Raycom Infotech Park, 2 Kexueyuan Nan Lu, Zhongguancun, Haidian Tel: (010) 8286 1993ago Fortune Building, 5 Dongsanhuan Bei LuTel: (010) 6590 8011akashira3/F, Landmark Hotel, 8 Dongsuanhuan Bei LuTel: (010) 6590 6688 ext 5333nadaman3/F, China World Hotel1 Jianguomenwai Dajie, ChaoyangTel: (010) 6505 2266 ext 39

KoreanSaveurs de CoréeNanluogu Xiang, DongchengTel: (010) 64016083Sorabol2/F Liangmahe Building, 8 Dongsanhuan Bei LuTel: (010) 6590 0630

mediterraneanathena1 Sanlitun Xiwujie, Chaoyang Tel: (010) 6464 6036

mare14 Xindong Lu, ChaoyangTel: (010) 6417 1459/5431Serafino pizzeriaXiushui 2, 14 Dongdaqiao Lu, Chaoyang Tel: (010) 8799 3938aria3/F, China World Hotel1 Jianguomenwai Dajie, ChaoyangTel: (010) 6505 2266 ext 38happy valley1/F, Swiss Hotel, DongsishitiaoTel: (010) 6553 2288W Dine and WineUnit 22-1 Dongzhimenwai DajieTel: (010) 6416 9838

SichuanChuan ban5 Gongyuan Toutiao, Jianguomennei DajieTel: (010) 6512 2277 x6101Chuan liu bu xiUnit 1, Building ADigital Tower,Zhongguancun Tel: (010) 5162-7878Chilli peppers1/F, Longchengligong Hotel,HuilongguanTel: (010) 8079 9988 x76012

Thaia's pink loft6 Sanlitun Nan LuTel: (010) 6506 8811banana leaf4 Gongti Bei Lu Tel: (010) 6506 88552/F, Financial Centre, Bldg B, Zhongguancun Shopping CentreTel: (010) 5986 3666hua hua Thai restaurant100 metres west of Haidian Hospital, ZhongguancunTel: (010) 6255 0061lemongrass1/F, Jinzhiqiao Plaza, A1 Jianguomenwai DajieTel: (010) 6500 3855phrik Thai1/F, Holiday Inn, 66 Yongding Lu Tel: (010) 6813 22992/F, Lido Holiday Inn, 6 Jiangtai Lu, Chaoyang Tel: (010) 6437 6688 x28991/F, Gateway Building, 10 Yabao LuTel: (010) 85615236


a handy guide to professional services around ChinaaccountingErnst & young www.ey.comBeijing 16/F, Tower E3, The Towers, oriental Plaza, 1 Dong Chang'an JieTel: (010) 6524 6688Shanghai 23/F, The Centre, 989 Changle Lu, Tel: (021) 2405 2000Guangzhou 36/F Tower B, Centre Plaza, 161 Linhe Xi Lu Tel: (020) 2881 2888

financial Consulting

austen morris associatesHead office Asia Pacific Shanghai Puxi19/F Guangdong Development Bank Tower555 Xujiahui [email protected]: (021) 63901233 Fax: (021) 63901235Beijing BranchUnit 2509, Beijing Silver Tower, 2 Dongsanhuan Bei Lu, [email protected]: (010) 6410 7030 Fax: (010) 6410 7029

Car rental

Shanghai longhui Car rentalUnit 203, Unit 24, 300 Jingxiu Lu, Pudong, Tel: (021) 5169 9238, Fax: (021)5854 2832E-mail: [email protected] Service Include:• Long term/short term service• Airport pick up/drop off

• Exhibition & conference service• National reservation• Family use of the car• Chauffeur serviceTel: 400-888-2838 (National)Tel: (021) 51699238 (Puxi area)Tel: (021) 51099838Fax: (021) 58542832

rising Shanghai Car rentalProvides professional service including: - Long-term leasing - Short-term car rental - Airport pick-up / drop-off - Business travel service - Exhibition & Conference

service - Tourism trip serviceTel: (021) 5447 8361Tel: (021) 5447 8362Fax: (021) 5447 8369Email: [email protected]

anji Car rental & leasingAvis in China car rental & leasing service includes:• Airport pick-ups• Short-term rentals • Long-term leasing1387 Changning Lu, ShanghaiTel: 400 882 1119Tel: (021) 6229 1119Email: [email protected]

language SchoolsTli-iyu40 Liangmaqiao Lu, ChaoyangTel: (010) 6461 2973www.bjtli.cn

new Concept mandarin www.newconceptmandarin.com

ShanghaiUnit 9H, Ladoll International 831 Xinzha Lu, Jing'anTel: (021) 5228 2950BeijingUnit 701, Building B ocean Express, 66 Xiaguangli, Sanyuan Dong Qiao, ChaoyangTel: (010) 8446 6455

health Care

DragonflyDragonfly Donghu20 Donghu Road, Xuhui, Shanghai (Adjacent to Huaihai Zhong Lu)Tel: (021) 5405 0008Dragonfly Xinle206 Xinle Road, Xuhui, Shanghai (near the junction of Donghu/Fumin/Xinle Lu)Tel: (021) 5403 9982Dragonfly Hongmei Unit 5, Lane 3911 Hongmei Lu, Hongqiao, Shanghai Tel: (021) 6242 4328www.dragonfly.net.cn

Consulting

powerpointwww.powerpoint-group.comTaiwan104, 6/F, 72, Section 2, Nanjing Dong Lu, Taipei Tel: (886) 2 256 [email protected] 505, 120 Yanling Lu,

TianheTel: (020) 3720 [email protected] 708, 7/F, 1500 Longwu Lu,XuhuiTel: (021) 5409 [email protected] 901, 9/F, 28 Beisanhuan Dong Lu, ChaoyangTel: (010) 6440 [email protected]

hotels

hotel new otani Chang fu gong26 Jianguomenwai Dajie, Beijing,Tel: (010) 6512 [email protected]

landison plaza hotel333 Tiyuchang Lu,HangzhouTel: (0571) 8515 8888www.landisonplazahotel.com.cn

international Schools

yew Chung international School of Shanghaiwww.ycis-sh.com

BUSINESS TooLKIT


To have your business featured in these pages, please contact one of our representatives at (021) 5385 9063

Puxi CampusHongqiao:11 Shuicheng LuTel: (021) 6242 3243Gubei: 18 Ronghua Xi LuTel: (021) 6219 5910 Pudong CampusRegency Park:1817 Huamu LuTel: (021) 5033 1900Century Park:1433 Dongxiu LuTel: (021) 5045 6475

Shanghai united international SchoolHongqiaoTel: (021) 3431 0090Gubei

Tel:(021) 5175 3030Shangyin Tel: (021) 5417 8143Pudong Tel: (021) 5886 6080www.suis.com.cn

institutes

industrial logistics institute608 Tower B, Technology Fortune Center, 8 Xueqing Lu, Haidian, Beijing Tel: (010) 5128 1520 Fax: (010) 5141 4710www.inloginstitute.com enrolments@

residences & Serviced apts

oakwoodUnit 28 Jiaogong Lu, HangzhouTel: (0571) 8899 3131Fax: (0571) 8899 3030Email: [email protected]

Shama luxe at xintiandiTower 18, Lakeville Regency, Lane 168, Shunchang Lu,ShanghaiTel: (021) 6385 1818Shama xujiahui Tower 11-12, Novel Century,81 Xingeng Lu, Shanghai Tel: (021) 2411 [email protected]

hr/recruitmentBeijing Staff Service www.staffservice.com A1201 CITIC Building, 19 Jianguomenwai Dajie, (010) 6527 0988

Our client operates in the electronic and IT sectors, the company provides professional services relating to foreign trade of electronic products and engages in hi-tech investment in the electronics and IT industries. The company deals in home electric appliances, electronic materials, digital products, video/audio products, communication products, electric lighting products, auto electronic products, computer accessory materials and contracted projects. The company also provides professional foreign trade services covering financing, documentation service, customs declaration, commodity inspection, storage and transportation. For further information please contact:Mr. Seth JacobsChina Economic Review, Investment Services DepartmentTel:+86 21 5187 9633 X 859Fax: +86 21 5385 8953E-mail:[email protected]

Electronics SOE group seeksJV or strategic partnership.

Site Selection, Factory and Standard Workshop Space etc.

Customized Industrial Reports

Land, Factory, Utilites and Labor Cost estimates

Landlord Representation

Tenant Representation

Investment Consultancy

SOE JV Opportunities in Electronics and Logistics sectors

For further information please contact:Mr. Seth JacobsChina Economic Review, Investment Services DepartmentTel:+86 21 5187 9633 X 859Fax: +86 21 5385 8953E-mail:[email protected]

China Economic Review Investment Services


CoMPANY INDEX

Advertisers in red

a-D Airbus 15

AlibabaGroup 39

Amber 24

Amino 40

ARM 40

Audi 35

AustrianAirlines 60

AvisCarRentaland

Leasing 5

BissBeijingInternational

School 23

BMW 35

BoxingCatBrewery 41

Buick 35

BunnyfootAsia 40

BYD 36,37

CampanileGroup 28

Chery 36

Chevrolet 35

ChinaCarTimes 34

ChinaDaily 15

ChinaEasternAirlines

15

ChinaNationalChemical

Corp(ChemChina) 14

ChinaTreasuryOnline

16

ChinaWorldHotel 33

Daihatsu 34

DeutscheBank 16,17

DeutscheTelekom 15

Diacron 30

DowAgroSciences 14

DowChemical 14

DragonAviationLeasing

15

DSI 36

E-h EleganzaUomo 13

ErgoInsurance 20,21

Fiat 35

Finnair 7

Ford 35

Frost&Sullivan 37

Geely 36

Gemdale 17

GeneralMotors 35

GlobalTimes 15

GrandHyattHotel,

Shanghai 16

GreatWallMotors 37

Greennovate 22

GuamVisitorsBureau

59

GuangzhouAutomobile

Group 36

HotelReservation

Service(HRS) 46

HRS.com 46

i-l IBM 40

IKEA 46

IngenicsAG 35

Innovision 40

JianLakeGolfClub 41

JPMGolfDesignGroup

41

KeppelCorp. 15

KPMG 40

KunmingGreenLake

Hotel 4

LandisonHotel 39

LansonPlace 21

LeadershipInsights

International 17

m-p ManganeseBronze

Holdings 36

Mercedes 35

Microsoft 40

Monsanto 14

MunichReinsurance

Company 20

NDS 40

NotoFinancialPlanning

30

OrientalPlazaBeijing 3

OakwoodResidence

Hangzhou 43

PaulanerBräuhaus

42,43

PetroChina 15

Porsche 34

r-T RamadaPealHotel

Guangzhou 11

RedGateGallery 44

RioTinto 14

SAIC 36

SAP 31

ShanghaiBrilliance

CreditRatingand

InvestorsService 16

ShanghaiUniversity-

MBACenter 37

SheratonSuzhouHotel

andTowers 25

SichuanAirlines 15

Siemens 46

SingaporePetroleum

15

SofitelForebase

Chongqing 2

Sondrel 40

SonyEricsson 40

SwissAirline-Dentsu 9

Sygenta 14

SynergisticsLimited 33

Toyota 37

u-Z UMU 40

Vodaphone 40

Volkswagen 34,35

Xinhua 15

YewChungInternational

SchoolofShanghai

44-45

ZhejiangUniversity

38,40

OUT NOW

Tel: +852 3175 0322, or +86 21 5187 9633 ext. 864

and +86 10 5166 2335 ext. 864

[email protected] www.ChinaEconomicReview.com/book/fed

The most authoritative directory of multinational companies and other foreign firms operating in the China market.

• More than 13,000 company offices

• More than 13,000 named contacts

• More than 5,800 email addresses

• Listings include managers’ names and telephone numbers

CD-ROM* powerful features:

• Print labels • Annotate entries with notes

• Link to listed company websites • Export emails to Excel

• Fully searchable

Only US$200 (US$400 for the CD version)Buy both at US$500, Save 15%

CONTACT US TO ORDER

China Foreign Enterprise Directory 9th Edition 2009

OUT NOW Only US$50

China MICE Guide 2009-2010

Tel: +852 3175 0322, or +86 21 5187 9633 ext. 864

and +86 10 5166 2335 ext. 864

[email protected] www.ChinaEconomicReview.com/book/mice

CONTACT US TO ORDER

• More than 2,700 hotels• More than 4,400 named contacts• More than 1,700 email addresses• Listings include managers’ names and telephone numbers

The most authoritative MICE Guide of 2,700 hotels

(foreign as well as local) throughout China.


oUT oF THE BoX

green enough?

Chinese farmers are keen tomaximise their earnings bygoingorganic.Theshiftisnot

surprising;marginson"green"foodsareupto50percenthigherthannon-organic.

This creates work for firms inthe business of certifying organicfoods. Since Chinese organic stan-dards(unlikethoseofIndia)arenotrecognised by the EU Commission,Chineseorganicexportersneedinde-pendent certification fromorganisa-tionslikeGerman-basedCertificationofEnvironmentalStandard(CERES),which has certified 100 projects inChina since 2005. "There’s been adramaticriseinChineseapplicationsfororganiccertificationoverthepastfewyears,"saysMartinWeinschenk-Foerster, head of Asia operations atCERES.

CERES’s China-based customersare typically trading companies ex-porting produce from state-ownedand private farms. Export-mindedChinese farmers go to CERES be-cause itsmark is recognisedbyUS,EUandJapaneseauthorities.

Weinschenk-Foerster, himself afarmerwithadegreeinagrobiology,getsplentyofwork.Hecertifiespro-ducersofoilseedsandbeansaswellasberriesandfruitinChina’snorth-east. He is covering a wave of newirrigation-driven organic develop-ments in dry western regions, suchas cotton and tomatoes in far-westXinjiang province. There’s also athrivingexportbusinessinwildme-dicinalherbsplucked fromthehillsofShanxiandSichuan,andwolfber-riesinNingxiaandInnerMongolia.

CERES's fees depend on the sizeof theproject, saysWeinschenk-Foer-

Certification bodies are busy as Chinese organic food producers attempt to go globalBy Mark Godfrey

ster: "If it’s a farmer selling simplydried berries, that’s not complex, butan inspectorneeds tounderstand themachineryandchemicalsiftheberriesareprocessed."

Seeingamarketopportunity, localfirmshavealso entered thefield.Forexample,locallyownedcertifierOrgan-icFoodDevelopmentandCertificationCentreChina (OFDC) recentlygainedinternationalorganic certificationcre-dentialsandhassettowork.XieBiao,director of quality at the OFDC, saysgovernmentiskeentodevelopthesec-tor."Wegetaskedalotbygovernmen-

tal departments for technical supportinpushingfurtherdevelopmentoftheorganicmovement."

Unsurprisingly,organicfoodisnotwithoutitscritics.Inadditiontocom-mon complaints about lax standards,othersquestionthewisdomoforganicfarming in China at all. Critics claimorganic production threatens China’sfood security. China has less arablelandpercapitathanmostothercoun-tries. Modern, non-organic methodshave increased its harvests exponen-tially;organicfarmingisnice,butcanitfeed1.4billionpeople?■

GREEN CARD: A Chinese farmer displays her organic certification

IC

Open ROad

Journal of the european Union Chamber of Commerce in China

Buying Chinese stocks • Insurance markets • Better beer

China’s car market puts its foot on the gas

aug 2009

Journal of the european Union Cham

ber of Comm

erce in China

aug 2009

Euro Biz: Revving Up

Automotive

Transcript of Euro Biz: Revving Up