Economy and Politics

Guangdong Party Boss Warns CPPCC of Hard Times Ahead

Jan. 13 – Wang Yang, the head of the Communist Party for China’s wealthy Guangdong Province, has alerted the Chinese People’s Political Consultative Conference (CPPCC) that the province faces a tough and difficult year ahead in 2012. Guangdong is by far the richest province in China, having boomed during China’s export crescendo, but has been hit with rising labor costs and falling orders. Many businesses in the province over the last three years have either closed or relocated to cheaper destinations in China or to Vietnam, Bangladesh or India.

Yang told the CCPPC that the next 12 months would likely be the toughest the province would face in the past 30 years of China’s reform and development, and stated the province “sat on the edge of economic difficulty, social conflicts and even political risk.” Continue reading →

Posted in Business, Economy and Politics, Markets, South China | Tagged China Manufacturing, China Wage Overheads, Chinese Communist Party, Guangdong, Labor Unrest, Moving Inland, South China | Leave a comment

China Urges Financial Industries to Serve Real Economy

Jan. 13 – The two-day financial planning meeting held over the past weekend in Beijing has provided direction for China’s financial sector during the next five years. As part of the plan, financial industries will be used to serve the real economy, offering more credits to productive businesses that actually create most of the country’s new jobs and wealth. Financing channels will be further diversified, with the potential launch of new financial products.

For the future, China must improve the real economy’s access to finance and prevent over-speculation as well as virtual bubbles from inflating the economy, Chinese Premier Wen Jiabao said at the meeting. Continue reading →

Posted in Economy and Politics, Finance, Tax and Accounting | Tagged China Banking Sector, China Bond Market, China Corporate Bonds, China Financial Sector, China Inflation, China Institutional Investors, China International Board, China Loans, China Local Government Bonds, China Real Economy, China Securities Market, China Stock Market | Leave a comment

Dezan Shira & Associates Hits 20 Years in China

Dezan Shira & Associates' China partners, directors and senior managers. Responsible for several hundred employees, over 3,500 MNC clients in China and 12 China offices.

Interview with Chris Devonshire-Ellis

Jan. 9 – Dezan Shira & Associates celebrates its 20th birthday in China during 2012, making it one of the earliest foreign investment practices operating in China.

“I recall setting up in Shenzhen,” says the firm’s founder Chris Devonshire-Ellis. “It was during the very early days, and only a handful of professional services firms were in China at the time. Coudert Brothers and Freshfields were the big blue chip law firms, and I don’t think all of the Big Four had arrived in 1992 either. Most firms were in Beijing and a few in Shanghai, and the majority of these were Hong Kong-based practices. China hadn’t even liberalized their domestic legal and accounting industry at the time. Nearly all Chinese lawyers, accountants and auditors worked for the government; there was very little private enterprise in professional services back then.” Continue reading →

Posted in Business, Economy and Politics, FDI and Foreign Trade, Featured | Tagged China Alternatives, China Expansion, Chris Devonshire-Ellis, Dezan Shira & Associates, Interview | Leave a comment

2012 Foreign Investment Catalog – English Version

Jan. 9 – As we reported earlier, the new edition of China’s Foreign Investment Catalog has been released for the first time since 2007. It contains details of FDI policies in China, and again we summarized these in our previous article.

We have now translated the catalog; please find it available for complimentary PDF download here. Continue reading →

Posted in Business, Economy and Politics, FDI and Foreign Trade | Tagged 2012 Foreign Investment Catalog, China FDI, China Foreign Invesment Catalog, China Regulatory | 2 Comments

253 Items of Administrative and Institutional Fees Pertaining to Enterprises Cancelled

Jan. 4 – The Ministry of Finance (MOF) and the National Development and Reform Commission (NDRC) recently issued a notice announcing the decision to eliminate 253 items of administrative and institutional fees pertaining to enterprises (“fees”) imposed by provinces, autonomous regions and municipalities directly under the central government, resulting in the reduction of enterprises’ burden by approximately RMB10 billion. Continue reading →

Posted in Business, Economy and Politics, Finance, Tax and Accounting, Legal and Regulatory, Regulatory Update | Tagged administrative and institutional fees, enterprise | Leave a comment

Why India Matters

Investing in India makes sound Asia strategic sense when coupled with China

Op-Ed Commentary by Chris Devonshire-Ellis

Jan. 4 – Much has been made of comparisons between China and India, much of it driven by the fact that the two nations are (occasionally reluctant) neighbors, their size, population and simultaneous development and progression. For two nations so large, sometimes at polar opposites, yet at the same time offering potentially comparable market sizes, is unprecedented in history. Yet here we are, 25 years on from the beginnings of China’s first, tentative steps towards reform, and India now looms on the horizon as a giant of Asia.

Continue reading →

Posted in Business, Culture and History, Economy and Politics, FDI and Foreign Trade, Featured | 4 Comments

Beijing Applies for Implementation of VAT Reform Pilot Project

Jan. 3 – To resolve the issue of duplicate taxation on goods and services and support the development of the modern service industry, the State Administration of Taxation (SAT) and Ministry of Finance (MOF) issued the “Pilot Project Plan for Replacing the Collection of Business Tax with Value-added Tax (caishui [2011] No. 110)” (“Pilot Project Plan”) in November 2011. Shanghai will be the first location to implement the pilot project in the transport and certain modern service sectors beginning January 2012. The details of the pilot project in Shanghai are summarized in our previous posting here.

Continue reading →

Posted in Economy and Politics, Finance, Tax and Accounting, Legal and Regulatory, Regulatory Update | 1 Comment

China 2012 Preparations and Predictions

Dec. 27 – As many readers will know, China Briefing is written by Dezan Shira & Associates, a professional services firm that in 2012 celebrates 20 years of providing business advisory services to foreign investors entering the China market. Over that period, the practice has grown from a single office, SME-level business to possessing twelve China offices and a staff of several hundred. In doing so, it has been able to provide not just regulatory, legal and tax intelligence, but also combine this with the business acumen gleaned from two decades of successful China business practice in its own right.

Over the past two months, we have run several articles concerning the preparation for the coming year, as well as analysis and reporting on trends. In this piece, we gather these together as a convenient one stop shop for examining the potential for China’s economic and business environment during 2012. Continue reading →