July 11 - Industry experts are predicting that sales of residential houses in China’s southern city of Shenzhen may slip further to prices found 10 years ago.
During the first half of this year, housing prices decreased by 36 percent to an average of RMB11,014 per square meter compared to October’s RMB17,350 per square meter.
Of Shenzhen’s six districts, Bao’an reported the biggest drop in May, with the average housing price reaching RMB10,418 per square meter, down 7.3 percent from last month. In comparison, the average housing price in Longgang District decreased by fell only 2 percent during the same period to RMB8,910 per square meter.
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SHANGHAI, July 7 –Shanghai reported blackouts on Monday as summer temperatures continued to rise. The city’s power network is struggling to meet electricity demands brought by increased use of air-conditioning.
According to sources, the city’s electrical grid is fully loaded with all backup power generation systems are in use. On Saturday, city temperature reached 38.8 degrees Celsius, the hottest July 5 on record.
Provinces surrounding Shanghai were also not spared of blackouts that did not allow them to send spare capacity to the city.
The Shanghai Meteorological Bureau says that there will be temperatures of 35 degrees on at least three days this week. Last June, the State Electricity Regulatory Commission warned that the country would experience serious power shortages in summer.
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BEIJING, July 6 - The U.S. Internal Revenue Service is opening an office and place an attaché within the U.S. Embassy in Beijing.
The office, which will open “by the end of the 2008 fiscal tax year” according to Barry Shott, the deputy commissioner for the large and midsize business division, will focus on the Asia-PAcific region serve countries including Australia, New Zealand, Pakistan, India, Sri Lanka, South Korea, and Japan in addition to China.
The office “will be the face of the IRS in the Far East,” says Shott. The creation of the post is an agency response to the growing importance of the Asia-Pacific markets.
The IRS has already established overseas offices in London, Frankfurt and Paris, and this latest move is seen as an acceptance of the growing importance of developing relationships between foreign governments’ state tax departments and the co-sharing of tax data on both American individuals and multinational earning money overseas. It has not been uncommon elsewhere for U.S. businesses abroad to face visits from IRS officials.
For more information on filing taxes in the United States while living overseas, please visit the IRS website.
U.S. expatriates in China requiring advice over the paying of individual income tax in China and the implications of maintaining part U.S. paid salaries, or for the consolidation of China based accounts to U.S. GAAP standards, please contact tax@dezshira.com.
July 2 - The Sichuan earthquake is likely to hurt small livestock farms in rural China, with medium-sized to large livestock farms emerging as a new trend says an executive of Thailand’s largest agricultural conglomerate.China’s modernization of the farm sector will affect the key agricultural provinces of Hunan, Hubei, Shanxi, Jiangxi and Anhui says Damrongdej Chalongphuntarat of the CP Group.
Damrongdej, a vice-chairman of Chia Tai Group of Companies, CP’s China arm, says that Beijing implementation of tougher building codes will cover farms, effectively stamping out small-scale farms in the future.
CP Group plans to invest heavily in Sichuan, Hunan and Hubei by adding a chicken slaughterhouse and two animal-feed plants in the next two to three years the Bangkok Post reported. Read the rest of this entry »
July 1 - The July/August issue of China Briefing magazine is out now and available for download (click on the image - subscription required, however this is complimentary).
In this issue, we take an in-depth look at Beijing, concentrating on the reemergence of the capital as the nation’s financial center. The development of Beijing’s Financial Street has largely escaped the mainstream press. Yet, astonishingly, an entirely new district, has sprung up west of Tiananmen Square. The implications for China’s financial services industry are huge. Home to government regulators, China’s largest banks, and serious global players such as JPMorgan, HSBC, and Goldman Sachs, the new wealth and power base that has been created here is astounding. We look at the history of the area, at why the shift has occurred, provide maps and guides to what’s where, and interview some of the key players.
Included in this issue:
Why Beijing’s Financial Street has the upper hand over Hong Kong and Shanghai
The global financial institutions that have already arrived
The application procedures for a banking license in China
China’s other financial centers: Hong Kong, Shanghai, Shenzhen and Taipei
China’s futures and commodity exchanges
June 30 - After much speculation and negotiation, there are reports that a Disneyland in Shanghai seems to finally be in sight. The official confirmation from the Chinese government is expected to be made after the 2008 Beijing Olympics.
As early as 2002, there were already plans to build a Disneyland in mainland China by 2010. The project was shelved in 2005 due to concerns that another Disneyland in the country would pose stiff competition to its Hong Kong counterpart.
According to Hong Kong-based Wen Wei Po, the Shanghai government will own a major stake in the park by providing the land and financing construction while Disney will be in charge of managing the park while being paid royalties and a portion of the operational income. Read the rest of this entry »
June 26 - Tibet reopened to tourists Wednesday, three and a half months after the Chinese government banned visits by foreigners in the wake of violent anti-government riots and protests.
The first group of foreign tourists, from Sweden, arrived at the Lhasa airport on Wednesday morning, said Tibetan Tourism Bureau spokesman Liao Lisheng.
“Tibet is open now to all travelers from home and abroad,” he said.
China threw a curtain around Tibet and areas in nearby provinces with sizable Tibetan populations after the March violence, citing the safety of foreign tourists and journalists.
But a notice on the bureau’s website said life in Lhasa had returned to normal, noting the June 21 torch relay “provided a more solid foundation for a stable society,” the Associated Press reported. Read the rest of this entry »
By Jennifer Wu
June 12 - Multi-colored snow art and illuminated ice sculptures greeted visitors from near and far at the Harbin Ice Festival. Held in the capital of Heilongjiang province, the annual festivities bring together everyone from ice sculpture artists and experts to fans and tourists alike. The snow and ice that draws so many tourists also helps to obscure the region’s industrial past, concealing what has become in recent years China’s largest rust belt. After years of neglect, the region is again seeing renewed government interest and incentives aimed at transforming this former industrial center into a viable economic region.
Once known as the cradle of industrialization in the 1950s, Northeast China saw its importance diminish as the country’s market-oriented reforms took hold in the late 1970s. In the last few years, the old industrial base has been on the rise again, as the government pours money and resources in. Today, the region, which consists of Heiongjiang, Jilin, and Liaoning provinces, is expected to transform into the China’s fourth economic engine, after the Pearl River Delta, the Yangtze River Delta, and the Beijing-Tianjin area. Read the rest of this entry »
BEIJING, June 12 - Beijing has seen massive development in the last 20 years. International five-star hotels, Oriental plaza, Wangfujing, the central business district, SoHo, the Shangri-La-owned China World Complex, and many others area of note, all have sprung up on the east side of the city. All of this development on the east side of Beijing has meant that Tiananmen Square is no longer the center of the city. This has been a major issue now for some time amongst city planners and the traditional Chinese feng shui experts who are concerned about city harmony and the traditions of old Beijing.
Historically, the western side of Beijing was reserved for nobility. Minor royalty, advisors to the court, favored artisans, painters, poets and other artists all lived to the west. Only new money, merchants, and other lower ranks lived in the east, giving rise to the local Beijing backhanded saying: “The people living in the east are the wealthiest, while people living in the west are the most traditionally noble.” Read the rest of this entry »
June 6 - Although many of the regulations concerning the registration of foreign visitors to China have been in place for decades, the actual enforcement of these often draconian measures now being employed has not been seen in China since the late 1980s. This, compounded by seemingly erratic treatment of business visa applications and coupled with occasional bureaucratic entrepreneurial activities, has meant that the Beijing Olympics are becoming far less likely to be a truly global event and far more a Chinese celebration.
We have received first hand accounts from businessmen attempting to enter China on apparently legitimate commercial trips being turned away, forcing mass cancellation of hotel bookings, and of individuals with seemingly impeccable employment credentials being denied a renewal of work visa. Additional problems from reliable sources indicate Olympic events tickets are being withheld currently from main Olympic sponsors entitled to certain seats in favor of Chinese government officials from other provinces who are “potentially” attending.
The visa issue, heavily reported in the news and on various blogs recently, had previously been thought to be a crackdown on the practice of foreigners living and working in China without going through the correct work visa procedure in order to avoid taxes. While true in the majority of such cases, first hand reports from hoteliers in Beijing reveal the practice of blanket rejections of business visa issuance to legitimate businessmen—including in several cases groups of prominent international bankers due to hold regional board meetings in Beijing—have been taking place. In one instance, we have been made aware of a group of Australian bankers whose collective party was rejected for business visas at a total loss of US$300,000 to the hotel over canceled bookings, as none of the bank’s executives were able to obtain visa clearance. In other cases, we have heard directly from businessmen of certain Asian nationalities, holding legitimate work visas as chief representatives of their companies in China, also being refused entry. Read the rest of this entry »
for Dezan Shira & Associates, the foreign direct investment legal and tax practice responsible for China Briefing 
