By Eunice Ku
Sept. 11 – A wholly foreign-owned enterprise (WFOE) is a company established in China according to Chinese laws and wholly owned by one or more foreign investors. A WFOE is a limited liability company, meaning that the liability of the shareholders is limited to the assets they brought to the business. Unlike the simpler representative office setup which is subject to a number of limitations, a WFOE can make profits and issue local invoices in RMB to its customers, which is crucial as invoices are the basis for obtaining tax deductions in China. Compared to a joint venture, a WFOE has greater freedom and independence, and can better protect its intellectual properties. It can also employ local staff directly, without obligation to employ services from employment agencies. Although there is no legal restriction on the number of foreigners a WFOE can employ, in practice the number of foreign employees does depend on the amount of registered capital (discussed below) that the respective company injects. Continue reading
Jun. 3 – The new issue of China Briefing Magazine, titled Sourcing from China, is out now and will be temporarily available as a complimentary PDF download on the Asia Briefing Bookstore throughout the month of June.
While the United States and Europe continue to lead in the production of top-end manufacturing and smart technologies, China is slowly but surely climbing the technology ladder, and is actively trying to raise the human capital and managerial skills needed to lead such growth. Meanwhile, China continues to outpace competitors in the mass production of those basic, low value-added products necessary in the daily lives of people around the world. It has also managed to develop a fast and efficient national network of roads, railways, ports and airports coupled with a first-tier integrated logistics system. On top of these structural accomplishments, China has created a skilled workforce capable of producing anything an engineer can design, and a comprehensive supply chain that sources energy and raw materials from around the globe. Continue reading
Posted in Business, Central China, East China, FDI and Foreign Trade, Featured, Legal and Regulatory, Manufacturing, Markets, Northeast China, Shipping & Logistics, South China, Textiles, West China
Op-Ed Commentary: Chris Devonshire-Ellis
Oct. 12 – One of the hidden treasures of Xinjiang is Shihezi. Actually the region’s second largest city after Urumqi, this has long been a farming community and is often regarded with typical Chinese aplomb as “A Shining Pearl in the Gobi Desert.” Continue reading
Posted in Business, FDI and Foreign Trade, Markets, Textiles, West China
Tagged China Agriculture, China Commodities, China Cotton, China Natural Resources, China Textiles, Foreign Direct Investment, Shihezi, West China, Xinjiang
Sept. 29 – China’s Ministry of Commerce (MOFCOM) released its 2010 Rankings of National Economic and Technological Zones on September 21. At present, China has 128 national-level development zones, 90 of which were included in the 2010 MOFCOM rankings.
According to the rankings, the top 10 development zones remained unchanged from 2009. Most notably, TEDA has been ranked the best national development zone in China for the 14th consecutive year. Continue reading
Posted in Automotive, Business, Chemical & Pharmaceutical, Economy and Politics, FDI and Foreign Trade, Manufacturing, Markets, Technology, Textiles
Tagged Development Zones, Great Wall Motors, Jiangsu Province, John Deere, Ministry of COmmerce, Motorola, TEDA
Oct. 13 – Beginning today, the Ministry of Commerce will be imposing an anti-dumping tax on certain imported polyamide-6,6 chips coming from the United States, Italy, Britain, Taiwan and France.
Polyamide-6,6 chips is imported to China for manufacturing plastics and textiles. Xinhua reports that the anti-dumping tax will be applicable for five years with a maximum tax rate of 37.5 percent.
Mar. 30 – Beginning April 1, tax rebate rates on selected textile, iron and steel, nonferrous metal, petrochemical, electronic information and light industrial exports will be raised.
The amount of the tax rebate rate is still unavailable; pending confirmation from the State Council. The move should help make the economic stimulus plan more effective while also supporting plans for ten industries.
Since last August, the export tax rebate rate for textiles has been changed four times; the latest one was in February when it went from 14 to 15 percent.
Feb. 5 – China will increase the tax rebate rate for textile and garment exports to 15 percent from the previous from 14 percent in an effort to support the textile industry and help exporters reduce costs.
The State Council did not specify when the new tax rebate rate will be applied. This is the third time since last August that export tax rebate rate were raised.
The government has also decided that it would provide funding technology upgrades for companies producing textiles or fibers, or operating in the textile printing and dyeing sector.
The central government has instructed local departments to provide financial support and insurance services to small and medium-sized textile plants.
Dec. 19 – The Ministry of Finance said it would decrease import tariff rates on selected products and increase export tariffs for high energy-consuming and pollution-producing sectors by next year.
The new rates should help China lower its trade surplus and help domestic companies decreased costs. The reduced import tariff rates affect more than 670 items including energy-related products such as coal, fuel oil, and stone materials, raw materials, hi-tech products, machinery parts and household appliances.