International Energy Agency (IEA) reported on Tuesday that the shale oil recently found in the United States will help meet most of the world's oil demand in the next five years. It is significant to the world market as well as to the U.S. itself because it eliminates the threat of future energy shortage and reshapes the U.S energy market and its relationship with other countries.
globalEDGE Blog - By Tag: china
Until now, China has never shown much interest in Middle Eastern investment. If it is able to establish a relationship with the Middle East, it can take advantage of arguably one of the most volatile areas in the world. In an area where westerners have long feared to go, China seems very interested in the diplomacy, economics, soft power and security. Upon helping in the war in the Middle East, China has begun to fully immerse themselves in the Middle East in an effort to increase their involvement in the area.
Back in February, a colleague of mine wrote a blog post regarding the European horsemeat scandal in which horsemeat was advertised as beef in supermarkets. He described the implications that this might have concerning the global supply chain. One quote of his that proved to be shockingly accurate was, “…that the recent events involving horsemeat are only the tip of the iceberg.” Yet another food safety scare has arisen in China, where people are getting served rat meat for dinner instead of the requested mutton meat. China has experienced other food scandals in recent years, mostly involving toxins detected in dairy products. These food scandals have resulted in increased international trade, especially with dairy products, and the much needed increase in food-safety regulation in China.
This year the spring slowdown in manufacturing may slow down more than anticipated. Following disappointing results in the manufacturing activity and industrial production worldwide, analysts are saying that with the already weak economies in China, Germany, and the United States, the slowdown could impact more than just spring. Germany has had a trend in weaker manufacturing activity, and the U.S. has been introduced to sequestration due to its weak trend in the industry. If China, Germany and the United States can’t find a way to power their manufacturing activity this slowdown could have global effects.
As political season in China begins between the National People’s Congress and the Chinese People’s Political Consultative Conference, there have been concerns with the consumption of luxury goods. China has gone to extremes measures to prevent the issue of inequality by banning politicians to speak publicly about spending on luxury goods. With increases in social media, people have been able to show how wealthy they are by posting to websites such as Tumbler, Instagram, Twitter, and Facebook. Recently, there was an online argument between a Chinese socialite and a member of a sports car club over who has more money. As Asian countries begin to crack down on the over the top display of wealth, could luxury goods retailers be affected?
As China becomes the world’s second-largest economy behind the United States, more investors are becoming interested in its stock market to seek profits. However, things are not that easy in the stock market, China’s stock market has just experienced a deep dive recently due to government intervention in the property market.
Germany’s economy holds a critical significance in the European Union, especially in regards to the ongoing debt crisis. Its industrialized economy has held steady despite a slump in the global economy. It might be surprising to hear that Germany, one of the most industrialized countries in the world, is undertaking an energy revolution that will dramatically transform its economy’s energy sector. The newly re-engineered economy will no longer receive its energy from nuclear powered stations as all nuclear power plants in Germany are being closed down. Renewable energy sources, including wind and solar power, will instead fill Germany’s energy gap. Will this move jeopardize Germany’s economy and how does this energy revolution affect Germany’s relationship with other countries?
After last year’s scare in China with the manufacturing industry taking a step backwards with a year of contraction, it has rebounded and returned to positive growth for four straight months. However, February was China’s lowest month of positive growth since November after posting record growth in January. February’s growth was 50.4, while in January it was 52.3. On the scale, readings above 50 indicate expansion, while below 50 indicates contraction.
2013 might just be the year emerging markets have been anticipating. Throughout the past year, investors have been pouring money into emerging markets in developing countries. There are other factors that point to success for emerging markets, but are they enough to boost the small businesses to profits and prosperity?
In an effort to quell the widespread problem of overproduction, China is encouraging mergers in nine key industries: steel, cement, shipbuilding, autos, aluminum, electronics, pharmaceuticals, industrialized agriculture, and rare earths. Chinese officials are confident that these mergers will increase economies of scale and limit brutal price wars. Government officials are also hopeful that consolidating companies in these main industries will result in larger companies that will emerge as titans of international trade.
In recent years, the Chinese and Latin American business relationship has done very well, especially in the South American countries. China is now the main market for most of the exports for Latin American countries, along with being a big source of imports as well. There has been much greater investment in Latin America by Chinese companies such as mining in Argentina, Brazil and Peru, manufacturing in Brazil and Uruguay, and tourism in the Bahamas. With all of these influences from China taking place, there have been some major imbalances of different kinds.
The New Year began with the United States barely avoiding sequestration that many economists agree would have been a giant setback for the U.S. economy that would pile on to the global economic troubles. Not the way to start things off. With the major economies of the world still struggling to return to the growth needed to bring down unemployment there may be good news after all.
Globalization has provided the world economy with an enormous amount of wealth and expansion since it first began in the 1970’s. It slowly progressed throughout the 1980’s up until the fall of the Berlin Wall, which led to a doubling of the global free-market labor force. Since then, the Dow Jones Industrial Average has climbed from 800 in 1979 to over 13,000 by 2007. The era of financial globalization went into effect in 2003, when financial services accounted for 30% of stock market earnings. For the past 3 to 5 years though, we have seen a different trend in globalization and the free flow of capital across borders.
Alongside China’s growing assertiveness in foreign policy, businesses in China are also being more aggressive in their international business practices. Chinese businesses are increasingly using international acquisitions to expand their presence overseas in various countries such as Canada and the United States. Chinese firms have already acquired an American manufacturer of high-tech batteries and a major aircraft leasing business this past month. Overseas acquisitions by Chinese companies are expected to continue to increase as firms pursue companies in Canada including Nexen, a major Canadian energy company. Chinese acquisitions are changing the landscape of international business and may also be an indicator of China’s goal to be the world’s strongest economy.
Many analysts anticipated the growing possibility of the 3rd largest economy falling into recession in the short future and the time has now come. The analysts expect that Japan will stay in recession in the final quarter of the year due to sluggish trade to China, a strong yen, and the effects of the tsunami that ravished the country over a year ago.
Official data on Monday morning showed Japans economy contracted during the second quarter this year by .03% and then by another .09% between July and September. The increasing contraction trend of the economy is putting more pressure on the government and Bank of Japan to take more steps to boost the economy.
A significant percentage of China’s wealthy citizens, especially those looking to retire, have decided that they no longer want to live in China. Instead, these members of the upper and middle classes in China are expressing serious interest in emigrating to the United States, Canada, and Australia. These three countries are appealing to wealthy Chinese because of their open spaces, clean air, consistent medical care, and relatively stable political systems.
When the financial crisis hit the world in the fall of 2008 most sectors of the economy came crashing down with it. International trade was no different, and by some measures the decline was more pronounced. When world GDP began to contract and hit its bottom in 2009, exports dropped nearly 30%. One would expect a certain amount of withdrawal when a crisis of this magnitude hit but with such a huge drop off the question arises what other factors could have played in? The answer is not as simple as it may seem.
As many of you news readers may know, China and Japan have been involved in a territorial dispute over a small chain of islands in the East China Sea. They can’t agree on a name—Japan calls them the Senkaku Islands and China calls them the Dioyu Islands, but both countries view those islands as part of their territory. They are technically controlled by Japan now due to war treaties, but China has had claims on them in the past so both countries have a case to make for ownership. However, as the islands do not really have much of significance on them, they are viewed as an important symbol of dominance in the often tumultuous relationship between China and Japan. While war or other extreme actions have not been taken yet, the dispute has impacted businesses in the area which could easily impact the world’s economy.
One of the most public dramas that has played out in the downturn of the economy has been the manufacturing sector's struggles. Data released earlier this week shows reason for cautious optimism in the United States. For nearly the first time in four months, manufacturing grew within the United States. While the U.S. welcomes even the smallest improvement, other regions did not fare as well. Both China and the Eurozone continue to see the manufacturing sector of their economy contract.
In today’s world, energy is always in demand and this has led many companies in the energy sector to focus on new renewable forms of energy. Lately renewable energy, specifically solar, has experienced a multitude of issues that threaten many of the companies that specialize in solar power. From the high profile collapse of Solyndra to the free fall of prices around the world, many are left wondering what the future holds for this burgeoning industry.
China is currently in an economic slowdown, the causes of which are a great debate in Asia’s largest economy. China, the world’s second largest economy behind the United States, expanded 7.6 % in the second quarter from a year earlier, the slowest pace since 2009. While a growth rate above 7% might seem thriving at first glance, you must first consider that China has had an average annual growth rate of nearly 15% since 2000. Many economists believe that their growth will slow further to a rate of around 7.0% for 2012. Is the economy of the most populous nation in the world in trouble?
The changing global climate has become increasingly more difficult to ignore due to climbing air and water temperatures, rising sea levels, and melting of polar snow and ice. Recent reports have stated that the area of ice in the arctic has never been smaller, which has recently caught the attention of Asian economists. The opening of the Arctic north promises new trade routes, untapped reserves of oil, and an abundance of minerals to discover.
In China, the domestic economy is struggling just like the rest of the world with slow sales and declining construction. The cost of labor has also increased drastically, with wage rates increasing upwards of 15% in some cases, year over year. Compared to May of last year though, exports have increased 15.3 percent, twice as fast as economists had predicted. How are Chinese companies finding success when Europe is in a debt crisis and the United States is still recovering from rampant unemployment though? Easy – exporting and automation.
No. Well, at least not for a while, according to Xu Xiaoping. Xu ranks among China’s most prominent angel investors. He is also CEO of a NYSE-listed education company called New Oriental Group that helps prepare people from China to study overseas. There are many reasons why innovation has been lacking in China. Many of these reasons deal with cultural differences in comparison to other countries, where innovation is encouraged and embraced.
Small businesses in China for a long time have depended on small firms, wealthy investors, and loan sharks for funding. Some of these tactics, depending on the terms, are illegal, but often times have been the only source for small businesses in need of loans. This is the case because China’s major state-owned banks focus on lending money to large enterprises that are owned by the state. The Chinese government has recently announced that authorities are looking for ways to legitimize this informal-lending sector, in hopes of transforming existing underground lenders into licensed investors and potentially small-loan companies.
In an attempt to decrease its carbon footprint, China is asking its energy-intensive industries to reduce their energy consumption by a greater percentage than previously mandated. These efforts by China are also a result of growing domestic and international pressure to decrease its reliance on fossil fuels. Last year, China’s industries fell short of the government’s goals for lowering energy intensity and pollutant emissions, but the government is optimistic about firms meeting this year’s targets due to new and improved policies and controls.
China has grown immensely in the global gold market. India has been the largest gold consuming nation for many years, but in 2012 China is predicted to take over the top spot. Chinese demand reached around 770 metric tons in 2011. This demand is a 20% increase from the previous year. This growth is strong, and experts see the demand continuing to skyrocket in China. There are several factors that have caused this increase in demand.
Africa is a land with vast natural resources, but they come at a high price. Africa is known for having some of the most unstable countries in the world. Even with these dangers, China has broadened its exposure in the region to secure the natural resources needed by the factories and businesses of the world’s fastest growing economy.
What happens when you mix a close proximity to fast growing nations and an abundant supply of natural resources? An impressive economic boom, but a fear of being highly dependent on a few key nations. Australia is currently enjoying not only a very lucrative demand for its natural resources from China and India, but is also becoming a tourism hotspot for the people of China.
In an effort to develop closer trade ties with China, Canadian Prime Minister Stephen Harper met with Chinese Prime Minister Wen Jiabao in Beijing last week. Canada’s goal is to continue to increase its trade with China in hopes of decreasing its reliance on trade with the United States. This goal especially relates to the oil industry and Canada’s effort to overcome the increasing environmental regulations being imposed by the United States. Canada sees China as a solid alternative for trade because of its vast market size and high demand for foreign oil.
Two years after pulling its search engine from main land China, Google is once again pushing to expand in the enormous market. The original disagreement between Google and Chinese officials started after Google traced a cyberattack to Chinese hackers. The hackers attempted to not only steal proprietary computer code, but also attempted to spy on Chinese activists' Gmail accounts. Although officials denied any connection to the hackers, Google moved its search site to Hong Kong where censorship requirements are not as strict.
The storm caused by the European Debt Crisis has loomed like a dark cloud over much of the world. But certain sectors of the economy, the transport manufacturing industry in particular, have weathered the turbulent markets. It is the rise in purchasing manager indexes for the United Kingdom, Switzerland, China, India, and Australia, coupled with the decrease in Germany's unemployment that make economists suggest a boom in the export of cars and machinery for the coming year.
Globalization and the growth in emerging markets have driven significant changes in nearly every industry around the globe. This no different in philanthropy where the “old” standard of donations being led by wealthy Westerners is being turned upside down. Explosive growth has led to tremendous wealth creation in many developing countries and veteran donors are urging the new rich to donate to important causes. Philanthropy has also been repackaged into a businesses where consumers help donate products to needy causes.
There are about 30 million overseas Chinese in total, and most reside in neighboring Asian countries. Indonesia and Thailand have the biggest numbers, with about 7-9 million each, while Singapore has the highest concentration of around 3 million, or 75% of its population. One such country that is reaping the benefits of immigration is Malaysia, but is Malaysia returning the favor?
China’s e-commerce industry is growing at an extremely rapid pace; it is expected to become the world’s largest e-commerce market by 2015. With a population of 1.3 billion, there is a vast untapped market for online sales in China. However, growing competition has lowered the margins and fuelled price wars in the region. What does the future of e-commerce look like for the growing nation?
The deals and sales offered during this year’s holiday season captured us all, but companies have been shopping as well. In fact, Japan’s multinational corporations seem to have gone on global shopping spree. This past year, Japanese companies spent a record $80 billion on approximately 620 foreign companies. These international investments could be seen as not only a sign of economic strength, but also as an indication of domestic weakness.
With many concerns and debates regarding climate change, countries around the world are looking for ways to reduce carbon emissions. These carbon emissions happen to be the leading cause of climate change and large coal-burning industries are mostly responsible. One way to reduce these harmful emissions involves a new technology that captures carbon dioxide from the air and pumps it directly underground for permanent storage. This project was operated in Germany, Scotland, and the United States with little success. However, the two largest consumers of carbon dioxide, China and the United States, are investigating a new way to reduce carbon output and are looking toward a surprising industry for this solution.
With the announcement of North Korea's Kim Jong II's death on Monday, many business and world leaders are trying to figure out what will happen with the historically volatile country. Although the US places strict restrictions on how US businesses can interact with North Korea, other countries are much more liberal and have created many opportunities for their businesses to profit from relations with North Korea.
The world of sports is closely intertwined with the world of business. Sports franchises and leagues function to create an economically-viable product for profit. Businesses in many industries utilize sports entertainment for its unmatched marketing opportunities. Global athletic events bring tourism, trade, and international attention to host cities and countries. Businesses could not function without sports and sports could not function without business. This week, the globalEDGE blog will take a closer look at business and economic impacts of sports around the world.
China’s image as a low-cost place of production is likely to change due to the rapid increases in worker wages. In fact, wages for the average manufacturer worker in China are expected to double by 2015. As this has begun to unfold, many foreign manufacturers have begun looking for alternative low-cost production bases and have been largely unsuccessful in finding better options. Foreign reliance on China for inexpensive production will likely be a thing of the past as these wages continue to climb.
Feeding on the strength of European demand and Asian emerging markets, China’s trade surplus rose to its highest level in more than two years during the month of July. The country’s surplus rose to $31.5 billion, the biggest gap since January of 2009. Chinese exports and imports both grew over 20 percent from a year ago and there are a couple key reasons that account for these large increases.
Growth in shipments to Europe has doubled over the last two months granting China higher export numbers. Exports to Japan also rose as Japan surges back after the tragic earthquake that occurred earlier in the year. China’s relationship with developing countries in Asia, such as Vietnam and Indonesia, continues to strengthen providing China with lucrative export markets. Sales of Chinese goods in these markets have increased this past year allowing the trade surplus gap to grow even larger.
Due to the increase in meat consumption in China, the need for soybeans has widened. The main country where the Chinese have looked is Brazil and are interested in purchasing hundreds of thousands of acres. When they were refused the land, the new strategy was to feed money into the agriculture industry in Brazil to give farmers the capital needed to triple soybean production.
In 1982, China was just beginning to open up to capitalism when the government decided to use a plot of land in a rural town of Yiwu to use as an open-air market. What started off as a rural, poor city has turned into a vibrant Trade Mart which now covers 988 acres. To put this into perspective, you could fit 10 Mall of America’s in the same space.
There have been massive efforts recently to improve the quality of China’s polluted air by blending low-polluting imported coal with dirtier-burning domestic coal. Experts argue that while this will positively effect the air quality in the near-term, it might contribute to faster global warming in the long-term.
Three months after Japan’s largest earthquake, a major nuclear reactor disaster seems to have been avoided. However, major doubts surrounding nuclear energy as a safe power source remain in countries around the world. If these doubts linger, the energy industry can be changed dramatically with this significant loss of faith in nuclear energy. Alternative energy sources must be able to replace nuclear energy and many countries will have to develop efficient and sustainable infrastructures to support this energy change.
With unemployment in America still hovering near 9 percent, many Americans are upset that companies are offshoring jobs to countries such as China. However, according to a new analysis by The Boston Consulting Group (BCG), there is a “manufacturing renaissance” on the United States’ horizon.
Food prices have certainly become a hot topic recently, and so has food quality. With oil spills, nuclear waste scares, and natural disasters constantly threatening the quality of the world’s food supply, businesses have to be more careful with what food they sell. Still the exporting of food seems to continue to increase. Fish exports in particular have seen a huge increase in global demand.
Pecans have long been a steady source of income for farmers in the United States. Southern farmers produce two-thirds of the world’s supply and U.S. consumers have been the main source of their business. According to the U.S. Department of Agriculture, the current price of $2.14 per pound for pecans is nearly twice as high as three years ago. What has caused this sharp spike and what does the future hold for the pecan industry?
In 2009, China became Brazil’s largest trading partner in the world, overtaking the position that the United States has held since 1930. Brazilian exports are increasing rapidly to meet China’s immense demand for raw materials and commodities. On the other side of this trade relationship, cheaper goods imported from China are opening new horizons for Brazil’s growing middle class. This commercial relationship between these countries is continuing to grow and has reached an entirely new level.
To increase productivity and save large amounts of money on labor costs, many companies are either setting up outposts overseas or contracting third parties in other countries to do some of their work for them. This trend is known to most as offshoring, and while it continues to grow, many predict that we haven't seen the worst of it.
Over the last 100 years, transportation has taken some significant leaps. With the invention of the car and its proliferation to countries around the world, individuals were empowered to go where they wanted, when they wanted. However, as the boundaries of distance decreased with an increase in vehicle quality and reliability, so did the world’s desire to travel even further and at greater speeds. The latest potential advance in human transportation is the proliferation of high-speed rail.
A recent report by the U.S. Census Bureau highlights the U.S. Trade deficit for 2010. This report is very straight-forward and shows the change in the trade balance throughout the years. As most everybody knows, the U.S. has been running a large trade deficit (i.e. they have been importing more then they export) for several years now. The report gives us a good starting point to understand where the deficit is coming from and some of the reasons behind it.
After the official unpegging of the Renminbi (Also referred to as the yuan) to the dollar mid-way through last year, China has surprisingly started to increase the flexibility of the Renminbi and is actively encouraging the globalization of the currency. Much of this change has come for two reasons. The first is as China has become the world’s second largest domestic economy, the need for a globalized currency becomes exponentially more important. Also, international pressures on the Renminbi and China, especially from the U.S., have started to force change.
With China being one of Brazil’s most important trading partners, the two have created a whole lot of business and money-making opportunities for both countries. No person knows this more than Eike Batista, a Brazilian minerals tycoon that is now the eighth richest man in the world, with a wealth of $27 billion. He’s gotten there quickly, thanks in large part to China.
The Wall Street Journal had a very interesting piece for their “The Saturday Essay” this past week. It reflected on the cultural differences in parenting styles; written from the perspective of Amy Chua – a Chinese mother who is also a professor at Yale Law School. While it is written to contrast mostly American parents, I believe (and so does the author) that the article can be viewed from a completely global perspective.
‘China is on the rise’ is a statement that we hear all too often. However, China’s growth does not only appear to be benefiting China alone. Vietnam has been able to use this neighboring country’s growth to benefit its own economy. Vietnam has a lot of appeal for international business and has begun to make a name for itself through China's success.
Ahh Silicon Valley – a beautiful 50-mile strip located right on San Francisco Bay between San Francisco and San Jose. It's home to innumerous technology companies including global chip heavyweights Intel and AMD. Silicon Valley used to be the go to place to start a new chip company however startups are starting to attract less funding and much of the development can now be done in China.
With China’s push for rapid economic development, it’s no surprise that China consumes more energy than any other country in the world. As China dominates the global energy market, it also is the single biggest force in causing oil prices and carbon emissions to increase. However at the same time, the International Energy Agency claims China to be the most influential country in the development of renewable energy. China is looking to lower the costs of oil and reduce carbon emissions linked to negative climate change by improving the progress of green energy. This developmental process of increasing the supply of energy in China will affect almost every country in the world.
China has recently come under pressure from Europe for its domestic bias to companies competing for public construction contracts. While China has had to loosen the wording of laws after coming under fire before, many companies are up in arms after trying to endure some of the trials entailed in entering the Chinese economy.
China remains a robust destination for a gamut of businesses. The country offers a particular wealth of advantages for manufacturing companies. Often solely regarded as a region for inexpensive labor, China also offers an increasingly sophisticated range of manufacturers and workers. Today, China accommodates the entire span between high quality manufacturing needs and orders for manufactured commodity goods. For most global companies, perhaps the most important benefit of establishing a presence in China is the fuller access into the Chinese market that this provides. But what is the best way to navigate business operations in China?
If you watched the news recently, you would have probably noticed a huge event happening in Chile. In case you haven’t heard, 33 miners went to work in the San Jose Mine (used for the mining of raw copper) for what was supposed to be a ten hour shift. The roof of the mine ended up collapsing on them. Fortunately, after spending 69 days underground, all of the miners have been rescued from their earthen prison safe and sound. Now that this saga has finished its final chapter, perhaps the greatest impact experts in the Mining, Minerals, and Metals industry hope it has was best summed up by Alonso Contreras (a cousin of one of the trapped miners): “Hopefully no one ever again has to do anything like this.”
The United States has long been known as a global powerhouse when it comes to innovation – especially when it comes to manufacturing. These innovations may not necessarily be products (although some certainly were) but, rather, just tweaks to the manufacturing process that greatly improved efficiency (think of interchangeable parts or the assembly line, both developed by Americans). However, in today’s global economy, the United States is losing jobs in the industrial manufacturing sector, despite still being on the forefront of innovation. Many claim that this is simply because of the lower wages required in other countries, but is that the only reason why?
Say goodbye to your flat-screen TV and that new car battery you were going to buy. In late July China announced that they would be decreasing the supply of rare earth metals to the rest of the world. Now it may not seem like an obvious connection but these rare earth metals in question are the materials that help produce our flat-screen monitors, car batteries, and many more products we manufacture and sell. Now the question comes to, why is China doing this?
The view is a strange one for most foreign visitors to Chinese residential areas. An array of colorful fabric is draped from building to building in all directions. A local resident can often be seen reaching out of a high window to hook a cloth on the end of a long wooden stick. What is this strange ritual that appears unlike anything experienced in many Western cultures?
Did you know that by creating a building with a “green” design you can save 72% more energy, compared to a standard design? There is a great opportunity happening in China with green energy and building design. Of all the markets in the world, China is one which can leverage green building design more than most others. With the amount of new construction occurring over the next ten years, the country is poised to take advantage of significant overall energy savings, while reducing their carbon footprint. In fact, it is projected the China will add 20 billion square meters of buildings in the next ten years.
In a challenging economic environment, young professionals and recent graduates across the globe are forced to think of new ways to enter the workforce.
In the United States, some are taking an entrepreneurial approach. These entrepreneurs recognize that what they are doing on the side can create revenue – running a website out of their home or offering social media marketing consultation – and can be performed anywhere in the world with anyone, at any time. They toss the security of a paycheck and good benefits at a place that is now considered a boring place to work.
In China, the story is different. The economic future looks (arguably) optimistic – China boasts more than 10% growth on average. The problem is that China is providing more than 6 million college graduates a year and the economy is not producing the number of jobs demanded by the graduates. The video below is a great 6 minute documentary on the issue, especially for international students traveling to China to broaden their interests and expand their resume.
China currently exists as one of the most desired markets in the global business world. With E-Commerce on its current rise globally, the key then, is finding a way to reach China’s online customer base. As of 2009, China had roughly 384 million internet users, and that number is expected to hit 650 million in 2015. It’s safe to say that many online retailers around the globe are seeking a way to penetrate China’s market. The best way to do this is to gain a better understanding of the consumers they’re trying to sell to.
It can be done! Creating jobs back home while increasing sales overseas is possible and United Solar Ovonic has proved it. United Solar Ovonic is a Michigan based company that creates and exports solar panels and has recently begun a joint venture with United Solar Ovonic Jinneng in China. They develop lightweight, flexible solar panels. They are great, not to mention green, energy producers so it’s no wonder that this business has been booming.
Over the past 10 years, China has had a significant impact on the world economy. Many businesses in the United States, especially those whose success has been dependent upon manufacturing, have felt the effects the most. Although many feel that the shift in Chinese economic power has adversely impacted the United States, it is also important to highlight the positive aspects of these changes. One of the great success stories comes from Michigan, in the heart of the Midwest.
One of the major issues in today's international business climate is sustainability. Countries are ever-seeking new ways to operate in an evnrionmentally-friendly way, while at the same time saving money in the long run by coming off of a dependence on fossil fuels. The fastest-growing country in terms of economic growth and trade in the world is China. Due to China's current prevalence in the international business world, and its future impact, it is valuable to see what steps China is taking to go green.
As of today (July 1st), Japan has significantly relaxed the visa restrictions for tourists allowing the single fastest-growing group of overseas travelers, the Chinese, to be able to travel to Japan. These new regulations will enable another 16 million households to be able to apply for a trip to Japan. This is 10 times the amount of tourist visas that were available before the new regulations. Up to now, Japan had strict regulations regarding visitors from their neighbor to the west; only allowing wealthy Chinese with high annual incomes to travel to Japan. The massive influx of Chinese travelers will hopefully result in a jump in income for many local shopping centers in Japan.
We all know that China is a place full of innovation, business growth, and a giant work force. However, they have not been known as an extremely ‘green nation’. But now, they are attempting to make the future of business more environmentally friendly. The China Greentech Initiative was started about two years ago and was designed to encourage innovation in the green technology sector in China. Both the U.S. and Chinese governments have made climate change commitments and are both striving to be more sustainable.
The first round of the World Cup has definitely been cut throat so far! But the action on the field has not been the only competition centered around the world cup. In our blog series last week we talked about how sponsoring the world cup and advertising during it is not only extremely expensive, but very competitive as well. Any international sporting event brings the opportunity to bring global attention to your brand, product, or even country. The 32 countries that have a team representing them in the tournament have an advantage for international exposure, but other countries aren’t out of the game yet.
The BRICs markets – Brazil, Russia, India and China – have survived the global economic crisis quite well, emerging even stronger than before. These counties have large surpluses in international trade as well as reserves in foreign currency, which really helped in the last downturn. They are on pace to equal the G7 in size by 2032, seven years earlier than originally predicted.
Singapore's economy grew 38% in the first three months of this year. That is the strongest quarterly growth ever recorded in Singapore's history. The key to this recovery and of the Singapore economy as a whole is the manufacturing industry. Healthcare and electronics are the two biggest sectors for this industry in Singapore. Many companies that produce high-tech medical devices are looking to expand into China. China is a huge potential market as they grow and are looking for these high-tech equipments with their increased buying power.
Trends in the Aerospace and Defense Industry have been shifting lately; what was once a primarily domestic industry has started to become global in nature. As highly populated nations such as China and India become more open to global markets, international suppliers will seek to fill their demands. What are some of the things we can expect to see from the global Aerospace and Defense market in the near future?
The largest world fair in history will take place in Shanghai, China starting May 1 to October 31. Its theme is "Better City - Better Life". More than 190 countries will be present setting pavillions portraying their culture and technology.
The event is six months long and is expected to attract more than 70 million visitors. Therefore, it is an excellent networking opportunity. Nations that are already parters with China will be there in order to further firm the connection. Also, there is the chance to make new friends and establish new connections as a BBC video explains.
What do Michigan and China have in common? They are both involved in the production of a triple junction amorphous crystalline solar cell. In layman’s terms, solar energy. These roof-mounted solar cells will generate much more electricity than silicon because of it is lightweight and flexible structure which holds up more efficiently in real-world conditions.
McDonald’s Corporation is now starting Hamburger University in Shanghai as a place to train the latest generation of managers. This decision is influenced by the fact that China is McDonald’s fastest-growing global market, increasing 10 percent annually. Part of this growth is because collectively, Chinese spend nearly 300 billion dollars a year on eating out at informal restaurants.
Do you want to go out to eat? People around the world are saying “yes” to this answer, but are finding different venues to satisfy their hunger. In fact, you might be surprised to hear that 20% of the world’s food venues are street vendors! Did you know that of the 10 largest markets in the world in the food services industry, five are in East Asia? The industry is making some major shifts which are also specific to geographic location.
Imagine a scene that many of us carry out everyday: You are driving through a remote part of town, and you approach an intersection. At the intersection, there is a traffic signal where you stop and wait. As you look around, you see no traffic for miles! Wouldn’t it be great if the traffic signal knew the current traffic and changed the light to green? Welcome to the concept of Intelligent Transportation Systems (ITS).
It is finally here! China recently opened a chocolate theme park in Beijing. It contains five indoor pavilions with controlled temperature so that the chocolate does not melt as well as two outdoor sites. They offer displays of various chocolate made objects such as replicas of the Terracotta Army, the Great Wall, famous paintings, and other items such as shoes or sports equipment, and a full size BMW. Tina Cheng, who will be operating the park, said that visitors will be offered a full chocolate experience - they will be able to see, touch, taste, and purchase the different chocolate items.
How would you like to get out of traffic jams, have cheaper parking, and still get to work on time? Well, if you live in China, now you can! China is the world’s new automobile capital, estimated to sell more than 12 million cars this year. However, China also produces an electric bicycle called the e-bike.
China's State Council announced new plans and guidelines that are aimed at promoting the development of the tourism industry over the next five years. This is an attempt to improve the employment rate in the country since the tourism sector consumes fewer resources while generating job openings. The government is hoping that tourism will become a leader industry in the national economy.
One of the critical factors of having a large, successful international operation is having “feet on the street” in the country where multinational companies do business. Recently, an article from ChinaDaily.com featured some staggering statistics about expatriates and the duration of their stay in the country. Although business demands often dictate relocation by executives and their families, is this the most efficient use of resources?
China has just recently launched its brand new Growth Enterprise Market, a Nasdaq-style stock market that has been over 10 years in the making. Twenty eight small- and medium-sized companies will be debuting on the Gem as it is called, made to attract financing of new high growth industries. These industries include software companies, pharmaceutical firms and creative industries. But investing in these companies will be risky business, since there will less than 30 companies to begin with.
Poultry has been traded globally for years. Each individual country can not possibly produce everything it needs, making this trade a necessity. Of course, that does not mean that there hasn't been any problems. There are several past examples of poultry trade gone wrong, but as a result standards are higher, making trading less of a risk.
In 2004, China and the United States had a major rift in their chicken trades and there has been tension ever since. The initial problems were a result of the bird flu outbreaks. Following that, both countries temporarily banned the trade of poultry from one another. Soon after, China lifted their ban, but it was another two years before the U.S. followed suit. Around the same time, Thailand chicken exports were suffering because several countries refused to buy their chicken because of past outbreaks, even after the products have been inspected and deemed safe. It seems that there will always be tension over poultry trade.
Gary Locke, now a prominent figure in the U.S. Government is charged with the responsibility of forming U.S. Commercial policy across the globe. Gary is a recent appointee into the Obama administration and career politician. Prior to his current position, Mr. Locke served two terms as the governor of Washington. Given his new role, the obvious question becomes: How will Mr. Locke’s policies impact global trade? Here are two points to consider:
A recent ruling by the World Trade Organization (WTO) has those in the U.S. entertainment industry rejoicing. The ruling would force China to open the channels of distribution to free enterprise. This means that those from the U.S. in the entertainment business will be have their work distributed in a manner which should yield more profits. The ruling will play a major role in the complex relationship between China and the U.S. entertainment industry.
Sadly, this is the final chapter in our China and America blog series. We hope you enjoyed learning the many different aspects that make the U.S.-China relationship one of the most important in this day and age for the current global business climate. This especially holds true for the energy sector.
Anyone who has engaged in cross-cultural business knows that spending a little bit of time to understand the other culture will go a long way towards producing business success.
This is especially true in China, where business relationships usually require some form of personal relationship. In this country, business partners typically go through a long process of “courtship,” which will likely entail banquets and other events aimed at getting to know each other on a personal level, as well as a string of meetings where business progresses at a snails pace. This process is vital from the Chinese perspective, as the nation’s cultural values emphasize long-term relationships and prosperity over quick, impersonal deals.
China has three main goals it weighs when considering where to invest its vast sums of money. Those goals are “safety, liquidity, and profitability - in that order.” For many years, the result of this strategy has been to invest heavily in U.S. Treasury notes. As the Middle Kingdom’s coffers began to fill with dollar-denominated debt, the financial well-being of the entire nation began to be increasingly tied to the strength of the U.S. dollar. So it should not come as a surprise that declines in dollar value that have occurred in recent years have been met with consternation by the Chinese.
There’s been a lot of talk lately about a new global reserve currency, or how the Yuan might overtake the dollar. One little-examined currency issue, however, is the role of virtual currency. Massively Multiplayer Online Role-Playing-Games such as World of Warcraft, which has nearly 11 million players worldwide, use an in-game currency system, where players can buy items, creatures, or even services from other players with virtual “gold”. In China, where a huge online gaming community exists, government officials are worried that, to some degree, virtual currency could replace the actual currency, and might even have a significant impact on the country’s economic system.
Richard Gelfond, co-CEO of IMAX, talks about the company's decision to sign a contract with a company in China due to the potential the country holds.
This deal is expected to increase profits for IMAX and the film industry in general. Furthermore, it will be helpful to the Chinese economy as it introduces a new product to the market with the potential for success.
The U.S. dollar has, for a long time, maintained its position as the world’s reserve currency. That fact, though, could be changing. As the debt of the U.S. government grows, it is possible that the dollar will lose its significance and subsequently its role as the world’s reserve currency, most likely to China's yuan. The ‘safe haven’ aspect of the dollar will not be easy for China to overcome, but with China’s economy growing as strongly as ever, it could be possible. Furthermore, China has been making financial moves which could land the yuan in the role.
China has long-held a reputation of being one of the world’s top exporters. 2007 World Bank Figures amount China’s exports to around $1.22 trillion, or 37% of its GDP. It is the 2nd largest exporter in the world behind Germany, and is currently number one on globalEDGE’s Market Potential Index Market Growth Rate. The annual growth rate of China’s exports had traditionally been around 25 percent, although effects from the current economic downturn now project these numbers dropping to a modest 10 percent. So with a 15 percent drop, how can it expect to satisfy previous GDP growth expectations?
It was easy to run a profitable outfit when the Chinese economy was booming. Double-digit GDP growth, combined with strong demand for cheap Chinese exports fueled a tidal wave of successful startups. Investors shoveled tremendous amounts of capital into these young companies, but many were more concerned with “getting into China” than with investing in a particular company. As a result, many companies that would not have been financed during low-growth periods were given a shot.
I am a huge fan of pretty much everything that Monocle publishes. They are always on the cutting edge, whether the topic is public affairs, business, or even culture and design. Recently they partnered with UK Trade & Investment to produce a series of videos on the business climate in different sectors and countries around the world. So far the topics have been: Doha, Boston, UK Creative Sector, UK Motorsport, London, São Paulo, Guangzhou, and Sofia.
We wanted to let you know about a free global virtual seminar on business strategies for China & India and how to leverage these economies for global advantage. This webinar is organized by ICA (India, China and America) Institute, a non-profit research institute working to foster research and dissemination of knowledge on the rise of China and India and their impact on global markets, global resources and geopolitics of the world.
Some people thought that Asia, with high growth rates, huge trade surpluses and substantial foreign reserves could be less affected by the economic storm which originated in the West. Yet, a number of economic indicators show us that Asia in fact could not avoid being hit by such a global disaster because of the fact that it heavily depends on West to fuel it's own economy. For example, exports contribute 45% of Asian countries’ economy and out of these exports, western consumers count for a half of it.Western investors are also the major players in the Asian markets. The depreciation of Asian currencies caused a huge loss on currency-hedging products. Even so, Asia - the source of one third of global GDP - can play a crucial role in bringing the economy back to the prosperity.
The Middle Kingdom has long been the up-and-comer among the world’s economic powers. The nation saw year after year of double-digit GDP growth, fueled by a strong manufacturing base and high demand for its relatively cheap exports. The global economic crisis has not passed over China however, and it now seems that the nation is being forced to slow its plans for growth.