Op-Ed Commentary: Chris Devonshire-Ellis
May 13 – Much commentary in the media has recently been focusing on the “China slowdown” and the impact of the country’s lower GDP growth figures going forward. In reality, measuring GDP growth is always a losing game, and not a particularly good indicator of how an economy is progressing. China has had tremendous GDP growth over the past 20 years, but it has always been inevitable that this growth would begin to slow at some point. A country cannot keep expanding its economy indefinitely at 10 percent a year, it is simply not possible. Accordingly, the naysayers over China’s future when it comes to measuring it purely in GDP growth terms are misled about what is really going on. Sure, the economy is slowing, but not all at the same time, and it doesn’t necessarily mean anything bad. Continue reading
May 10 – China’s Ministry of Commerce (MoC) and the Ministry of Civil Affairs (MCA) jointly released the “Circular on the Establishment of For-Profit Senior Care Institutions and Service Institutions for the Disabled by Hong Kong and Macau Service Providers (hereinafter referred to as the ‘Circular’)” on March 12. Detailed information can be found below.
The Circular allows service providers from Hong Kong and Macau to set up for-profit senior care institutions and service institutions for the disabled in Mainland China through new launches or mergers and acquisitions, either in the form of Sino-foreign equity joint ventures, Sino-foreign cooperative joint ventures, or wholly foreign-owned enterprises. Continue reading
May 10 – The new issue of Asia Briefing Magazine, titled An Introduction to Development Zones Across Asia, is out now and will be temporarily available as a complimentary PDF download on the Asia Briefing Bookstore throughout the months of May and June.
The use of development zones in their different guises has been an effective model essentially brought to prominence by China over the past 25 years to help both foreign investors and domestic companies meet in a relationship that provides tax advantages to both. Development zones typically permit the foreign investor to bring component parts into a country for assembly without having to pay import duties. Investors may then add in locally-sourced components, assemble the final product, and warehouse it all duty free before then having the option of exporting the finished product (collecting some VAT rebates on the locally sourced portion) or entering the domestic market with a product assembled at local labor costs. Continue reading
Lanzhou: Transportation and Logistics Hub for Northwest China
By Yao Lu
May 9 – Lanzhou, once known as the “Golden City,” has been an important regional commercial center and transportation hub since as early as the Han Dynasty. The city used to be a major link on the ancient Silk Road and has played a vital role in the cultural and economic exchange between China and countries to its west throughout Central Asia, the Middle East and Europe. Today, Lanzhou is the capital of Gansu Province, covering an area of 1,631 square kilometers and home to approximately 3.14 million residents. Continue reading
May 8 – China’s National Development and Reform Commission (NDRC) released the “Catalog of Encouraged Industries for the Qianhai Shenzhen-Hong Kong Modern Services Industry Cooperation Zone (Qianhai Cooperation Zone) (hereinafter referred to as the ‘Catalog‘)” on March 6, 2013. The Catalog covers 112 encouraged industries that fall under the below six service industries:
- Modern logistics
- Information services
- Technology services
- Professional services
- Public services Continue reading
May 7 – The People’s Bank of China released the “Circular on Implementing the Pilot Measures for Securities Investment in the Mainland by RMB Qualified Foreign Institutional Investors (RQFII) (hereinafter referred to as ‘Circular’)” on May 2, 2013, which offers guidelines on the implementation of the RQFII program. Detailed information can be found below. Continue reading
May 7 – Representative offices (ROs) are taxed as permanent establishments in China. The “Interim Measures for the Administration of Tax Collection against Permanent Representative Offices (ROs) of Foreign Enterprises (guoshuifa No. 18 )” issued by the State Administration of Taxation generally provides that ROs are required to pay corporate income tax on its profits, as well as business tax and value-added tax, which usually amounts to a liability of approximately 11 percent to 12 percent of the total expenses of the RO. ROs are required to keep proper accounting records to ascertain their actual revenues and profits and also accordingly file taxes. Continue reading
R1 and R2 visa categories to be created
May 6 – China’s Legislative Affairs Office of the State Council issued a draft proposal on Administration Regulation of Entry and Exit of Foreigners (hereinafter referred to as the “Draft”) on May 3, 2013 which includes provisions on issuing longer term visas for foreign experts. The Draft has been released to the public for gathering opinions until June 3, 2013.
The Draft reveals two new types of visas – the R1 visa and the R2 visa – specifically designed for foreign talents and professionals working at a senior level and possessing skills that the country urgently needs. A R1 visa is classified as a residence visa, while an R2 visa is a visitors visa which may allow multiple entries and exits from the country. Continue reading