BUSINESS >> Insight

Driven by devoted youth, ACGN market expected to skyrocket to 500b yuan

The popularity of erciyuan – a Chinese term that refers to an online world of anime, comics, video games and novels – has spread beyond cities to rural China. Erciyuan, which literally translates to “two dimensions,” is projected to become a 500 billion yuan ($72.7 billion) business over the next few years. The industry has caught the attention of major Chinese tech companies such as Tencent and Xiaomi. However, analysts said the domestic erciyuan market remains in an early stage of development and is still influenced by Japanese creations.
Source: Global Times | 2017/2/13 17:32:07

China-Pakistan Economic Corridor aims to boost trade between two countries

For the first time, the residents of Northwest China’s Xinjiang Uyghur Autonomous Region were able to eat seafood imported from Pakistan by container cars through the Khunjerab Pass in January. This successful trial is expected to improve overland trade between China and Pakistan via the China-Pakistan Economic Corridor, which accounts for 2 percent of the overall trade between the two countries. Meanwhile, the Xinjiang government has decided to invest more than 170 billion yuan ($24.72 billion) in a road network between China and Pakistan to improve transportation capability. However, experts noted that there remain challenges to the growth of bilateral trade, such as a lack of infrastructure and insufficient consumer demand in western China.
Source: Global Times | 2017/2/12 20:08:39

China could beat Japan on bullet train projects in Southeast Asia

Following news that Thailand and Malaysia are set to begin talks on the construction of a 1,500-kilometer high-speed railway (HSR) linking Bangkok in Thailand and Kuala Lumpur in Malaysia, Chinese experts said that Chinese HSRs have more merits than their Japanese competitor – called shinkansen. The Bangkok-Kuala Lumpur railway will be a new addition to the 3,900-kilometer pan-Asia railway network that is already taking shape. Chinese experts said it makes more sense for customers to choose a Chinese solution, as owning two systems will backfire in terms of maintenance.
Source: Global Times | 2017/2/8 19:43:39

Alipay, WeChat, UnionPay have big plans to gain larger share of growing market

The competition in China’s mobile payment market is growing tougher with the standardization of China UnionPay’s quick-response code technology in December. The head-to-head digital hongbao wars between the two dominant players WeChat and Alipay during the Spring Festival holidays provides one piece of evidence. Behind the cutthroat turf war, both of the platforms have broader ambitions, including creating tailored financial products based on their collections of big data. In the near future, the industry will also be subject to tighter regulations.
Source: Global Times | 2017/2/7 17:58:39

Sales plunge as local govts tighten restrictions to reduce air pollution

Fireworks were once one of the fastest-growing industries in China, supported by vast domestic demand during the celebration of the Spring Festival holidays and other special occasions such as weddings. But fireworks vendors said the good times are over as more and more local governments have tightened regulations over the use and sale of fireworks during the Spring Festival in an effort to reduce air pollution. In Beijing, fireworks sales during the holidays in 2017 fell 30.3 percent from the previous year. However, the capital city was still plagued by high levels of air pollution during the first day of the lunar new year, when residents traditionally set off fireworks.
Source: Global Times | 2017/2/6 17:53:40

Industry expands rapidly thanks to convenience, tailored teaching plans

China’s online education industry has expanded quickly in recent years as more and more users are attracted by the convenience of learning over the Internet. Online education eliminates the restraints of time and space for users, its proponents say, and helps popularize educational resources. Experts forecast that the domestic online education market has great potential to grow rapidly over the next five years, with vocational education and language teaching enjoying the most popularity. However, online education platforms face challenges, such as how to improve interaction between instructors and students and how to make more tailored teaching materials for students.
Source: Global Times | 2017/2/5 20:33:39

Aircraft maker calls in movers as power shifts to new headquarters

After a top-level restructuring at Airbus come the musical chairs and a new logo intended to convey unity as the European giant aims to refocus its management without a return to past infighting.
Source: Reuters | 2017/2/2 18:53:40

Stricter regulations eliminate unqualified funds, but holes remain

China’s private equity (PE) industry had an eventful year in 2016. The industry’s regulator tightened the rules for funds, initiating a registration system for PE fund managers. It also required fund managers to pass a national qualification exam to take a job in the industry. The regulations have eliminated many unqualified funds from the market, a change that one fund manager applauded as contributing to the industry’s sound development. However, people in the industry pointed out that holes remain in the regulations. One suggested regulators focus on cracking down on illegal fundraising. Despite fluctuations in fund returns, experts forecast the PE industry will grow quickly in 2017.
Source: Global Times | 2017/1/24 19:08:39

S&P 500 chief executives excited about promised tax cuts, govt stimulus

It has been less than one week since Donald Trump was sworn in as the 45th president of the US, and many CEOs of the country’s largest companies are already optimistic that his policies will benefit their bottom lines. Senior executives from Morgan Stanley, Delta Air Lines and other major US corporations said the Trump White House has already sparked a brighter outlook for business. They pointed to promised tax cuts and government spending as two drivers that could boost economic growth during Trump’s term. Of course, not every CEO was overjoyed about the prospects of Trump presidency. Uncertainty about trade and immigration policies could undermine economic growth, depending on how far Trump is willing to go to meet his campaign promises.
Source: Reuters | 2017/1/23 17:48:39

Foreign brands grab big share of market to counter China’s choking smog

China is choking on smog. The problem has reached the point that many residents can no longer ignore it. But with challenges come opportunities as demand grows for products to counter air pollution, such as filtration masks, air purifiers and herbal remedies. Some US and Swedish companies have already grasped the opportunity. Over a five-day period in December 2016, Internet retailer JD.com Inc sold about 15 million US-branded filtration masks. Other companies are also looking to cash in, signaling that competition in China’s anti-pollution market is heating up.
Source: Global Times | 2017/1/22 20:13:39

Wang Jianlin turns real estate giant into conglomerate with big ambitions

Wang Jianlin started Dalian Wanda Group in 1988, and has since turned it into one of the largest real estate developers in the world. Now, Wang has taken on a new mission to diversify his company’s business to focus on services and expand its reach across the globe. Making money no longer seems enough for China’s richest man. He has a bigger goal: to make Chinese standards the international ones.
Source: Global Times | 2017/1/18 18:23:39

Facing higher taxes, costs, foreign companies shutter operations in China

The planned closure of US disk drive manufacture Seagate’s factory in Suzhou, East China’s Jiangsu Province, as well as US tech giant Oracle’s layoff of one of its research groups in China, has put the country’s changing business environment under the spotlight. Taxes, rising labor and leasing costs, as well as uncertainties over US President-elected Donald Trump’s presidency are the major challenges faced by foreign companies working in China, experts noted.
Source: Global Times | 2017/1/17 18:48:40

As US lags, China, Europe drive shift to electric vehicles

At the North American International Auto Show in Detroit, which will end till Sunday, a company executive referred to the ongoing switch from gasoline to electric vehicles as “an irreversible trend.” It’s true that electric vehicle sales have been picking up in many of the biggest auto markets around the world – just not in North America. In the US, registrations for plug-in vehicles fell in 2015 and again in 2016, as low fuel prices aided sales of gas-guzzling vehicles. However, the European and Chinese markets are picking up the slack, with China in particular expected to make a hard push to meet electric vehicle sales goals by the end of the decade.
Source: Reuters-Global Times | 2017/1/16 18:08:39

Asahi’s sale of farm, dairy businesses shows problems in country’s rapidly growing cold-chain logistics industry

Japanese beverage maker Asahi Group Holdings reportedly sold its farm and dairy businesses in China due to the country’s underdeveloped cold supply chain. Experts said that China’s cold-chain logistics network in first- and second-tier cities has developed quickly in recent years, but still lags behind that in more developed countries and regions. Still, the industry has great growth potential, and any of its problems can be addressed through improvements in transportation equipment and technology, as well as the creation of industry standards.
Source: Global Times | 2017/1/15 20:18:39

With interest in winter sports growing, more tourists heading to Switzerland

Switzerland has been an attractive destination for Chinese tourists in recent years, especially due to their growing interest in winter sports after Beijing won the rights to host the 2022 Winter Olympic Games, according to a report by the Swiss Chinese Chamber of Commerce. With China’s ski industry expected to grow rapidly over the next five to 10 years, there will be greater demand for trips to ski destinations such as Switzerland. Although terror attacks in Europe in 2016 dampened enthusiasm for traveling to the country, industry representatives are optimistic that it will continue to be a desirable destination.
Source: Global Times | 2017/1/11 18:53:39

Despite lack of success in China, foreign banks’ investments still pay off

Australia and New Zealand Banking Group (ANZ) has become the latest foreign bank to scale back its China presence by selling its stake in a Chinese lender. With the sale, ANZ has followed many foreign banks and financial institutions out of the Chinese mainland. Although many foreign banks have been unable to achieve their grand ambitions in China, experts said their investments in Chinese banks have turned out to be a good deal.
Source: Global Times | 2017/1/9 19:03:39

Market awaits effects of stricter govt restrictions on foreign exchange

The Chinese government has introduced a new set of rules for foreign currency purchases, which prohibit people from buying foreign currencies for certain purposes such as investing in real estate or buying some kinds of insurance. Investors and companies said they are unsure how the new rules will affect them specifically, though pessimism prevails. But experts noted that the policy will likely be temporary, and the government remains committed to its goal of opening up China’s capital account.
Source: Global Times | 2017/1/8 19:08:39

After mayor’s resignation, surge in home prices unlikely in Chongqing

One week has passed since Chongqing Mayor Huang Qifan resigned, yet domestic media is already abuzz with speculation about whether housing prices will soon surge in the southwestern municipality. The short answer is: probably not. But the speculation underscores the success that Huang had at keeping real estate prices under control during his 15-year tenure in the city. Experts said a price surge is unlikely in the short run because of the policies Huang has implemented, as well as the central government’s commitment to keep property prices in check nationwide.
Source: Global Times | 2017/1/4 19:48:39