EU-China Economic Cooperation (EUCEC) Forum 2016 – 28 April 2016 – Hannover
Mar-29-2016 By : fcccadmin
In 2015, the Chinese economy has experienced its lowest growth rate since the last 25 years, going along with strong devaluation of the renminbi and falling Chinese stocks. Although numerous sources have therefore expressed their concerns about the sustainability of the Chinese growth model, it is necessary to consider that the planned 6.5% minimum growth rate announced by the Chinese government for the next five years is still high compared to most industrialized countries. Furthermore, the absolute growth of China´s GDP from USD47 trillion in the first decade of the 21st century to USD50 trillion until 2015 does not fail to impress.
The term “New Normal” is used to describe the transformation of the Chinese economy from a rather quantity-focused to a more quality-orientated strategy, which will consequently lead to a soft landing in terms of GDP growth rates. As labour costs in China rise to an all-time high an increasing emphasis is put on household consumption and the service sector, moving away from an export-led growth model. The implementation of new structural reforms aims at reducing income inequality between Chinese households, encouraging consumption and therefore strengthening labour market flexibility. This strategy should ensure the successful transition for China to a consumption-based growth model and therefore to reach the economic goals stated in the new five-year plan.
For the German economy, the transformation process of Chinese economy includes risks as well as new opportunities. With China being Germany´s fourth biggest destination for exports worldwide, its market changes lead to immediate effects for the German GDP. According to the German central bank, an economic slowdown in China implies a serious risk for growing losses for German companies. Nevertheless, China´s increasing focus on high-technology and environmental solutions will likely benefit exports of specialized German companies in the future.
Program (tentative)
14:00 Moderation by Thomas Scheler, General Manager, DCW GmbH – A Subsidiary of German-Chinese Business Association (DCW)
14:10 Introduction: Latest Trends in EU-China Economic Relations by Silke Besser, General Manager, German-Chinese Business Association (DCW)
14:30 M&A China and Germany – Latest Trends and Ways to Success by Frank-Christian Raffel, Co-founder and Managing Partner, MelchersRaffel Ltd.
15:00 Protecting and Enforcing Intellectual Property Rights in China by Erik Schäfer, Partner, COHAUSZ & FLORACK Patent Attorneys and Attorneys-at-law
15:30 “One Road, One Belt”: Linking Europe and Hong Kong by Michael Ries, Marketing Manager, Hong Kong Trade Development Council (HKTDC)
16:00 Intercultural Communication: Business Etiquette in different Regions of China by Wu You, General Manager, WUYOU GmbH
16:30 Q&A with all Speakers
17:00 Get Together at DCW International Joint Booth (Hall 3, H02)
Participation is free of charge for visitors of HANNOVER MESSE 2016. Registration is required. Please register via email: registration@dcw-gmbh.de
Visit the International Joint Booth „Doing Business with China“ in Hall 3, H02! For more information about other activities at HANNOVER MESSE 2016 please visit:
www.dcw-ev.de/hannovermesse
Car-audio producer to partner with Chinese automakers
By : fcccadmin
New York-listed Harman International Industries, one of the world’s largest car-audio makers, has launched a global product development center in Suzhou, Jiangsu province, eyeing expanding demand in China. It will work closely with fast-growing automakers, including BAIC Motor, BYD, Changan Automobile Group, Chery Automobile, Zhejiang Geely Holding Group, Great Wall Motor and SAIC-GM, said Dinesh Paliwal, Harman’s Chairman, President and CEO. In the past, Harman offered car-audio and infotainment systems exclusively to high-end, luxury automobile brands, but now it is offering products to a wider range of vehicles. China has become one of Harman’s fastest-growing markets, which accounted for approximately USD700 million in revenue, with an annualized growth rate of approximately 53% over the past six years. Harman sees increasing demand for affordable car-audio and connectivity systems from China’s younger consumers who attach great importance to customer experience and quality, the China Daily reports.
Online financing gaining ground, report at Boao Forum says
By : fcccadmin
Online financing is outperforming financing services offered by bricks-and-mortar channels, according to a report jointly released by Boao Review, Nielsen Holdings and Tencent Holdings at the annual Boao Forum for Asia. It used three measures – accessibility, availability and profitability – to evaluate the performance of online financing and came up with a China Financial Internalization Index that now stands at 108.5. When the index stays at 100 the impact of online financing is the same as offline. When the reading is above 100, it shows that online financing is bringing more positive effects than that of offline to loan seekers. “For years, small-business financing has been an impediment to China’s market economy,” said Kevin Wang, Director of Finance Research of Nielsen China. “Internet financing can help small businesses and startups that do not have access to bank lending and traditional financing resources in a good way. So those emerging online finance platforms can strengthen China’s financial industry and promote its small and medium-sized businesses.” The report is based on a poll of 4,267 people and 2,211 companies. It found that nearly 40% of those surveyed said they experienced the rejection of a loan application by a bank and nearly 42% said they successfully received a loan from an online financing platform, the China Daily reports.
Rising debt at state firms among biggest challenges facing China’s economy
By : fcccadmin
Mounting debt and slow reform at state-owned enterprises (SOEs) are the biggest challenges to China’s economic outlook. “The biggest risk is the huge buildup of credit relative to GDP, though it is not an across-the-board problem,” Nicholas Lardy, Senior Fellow at the Peterson Institute for International Economics, told the South China Morning Post on the sidelines of the Boao Forum. “The buildup of credit is primarily in state-owned enterprises,” he said. “If you look at private companies in the industrial sector, their leverage ratio is actually going down. The leverage ratio for state firms is skyrocketing. Some of them are not borrowing money to cover investment, but to cover their operating costs.” That is one of the concerns economists noted in the wake of the lending spree in January when new bank credit hit an all-time high of CNY2.51 trillion. “I don’t think there would be a danger of a medium-term banking crisis, but if the debts just keep piling up, eventually, there will be a banking crisis. You cannot slow down the debt if there are no big efforts to deal with state-owned companies,” Lardy said. Li Yang, former Deputy Director of the Chinese Academy of Social Sciences (CASS), said at the forum that a new financial oversight regime may be finalized in months. It is widely expected that the three watchdogs for securities, banks, and insurance will be merged to guard against regulatory loopholes.
Still no consensus over the negative list in BIT negotiations between China and U.S.
By : fcccadmin
China hopes to achieve substantial results from negotiations with the U.S. over a Bilateral Investment Treaty (BIT) before August, but it is still hard for both sides to reach a consensus on the negative list issue, former Minister of Commerce Chen Deming said on the sidelines of the Boao Forum for Asia (BFA). He is concerned that an agreement will not be reached before the U.S. presidential elections enter the final phase and new uncertainties will surface. China and the U.S. started the BIT negotiations in 2008, and there have been 24 rounds of talks. In 2013, the two sides reached a major breakthrough when they began discussing each other’s negative list, which identifies all the areas that are not open to investors. Premier Li Keqiang said that the two sides are making efforts to speed up the BIT talks and that China will gradually increase market access for U.S. investors, adding that the process should be mutual. China became the largest trading partner of the U.S. in 2015 with bilateral trade reaching USD560 billion, so a treaty between the two countries would have a major impact on the world economy, according to Chen Deming. “From the Chinese perspective, the country’s investors will gain a higher degree of confidence as the BIT enhances their ability to control things,” Reuben Jeffery III, former U.S. Under Secretary of State for Economic, Business and Agricultural Affairs, said. Chen added that a major problem for Chinese investments in the U.S. is how the U.S. views China’s state-owned enterprises (SOEs). In several cases, the U.S. government has barred Chinese companies from entering its market for allegedly having a Chinese government background. Chen also noted that national security has been excluded from the talks, the Global Times reports.
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