Foreign Firms Leaving China

p2prada

Senior Member
Joined
May 25, 2009
Messages
10,234
Likes
4,015
WTF!! 10% loss of toy factory employment. That's a rather big number.
 

cir

Senior Member
Joined
Dec 28, 2010
Messages
1,996
Likes
269
Yes,yes。 those making autos,home appliances、toys,clothes etc should leave China now and set up shops in countries like India and Vietman。China only wants large scale、high-tech、 high-quality、low energy intensity investments。

In a sh1ty year that is 2011, during which many countries,including the so-called emerging economies,had an awful run of lucks, such as dramtically slowing economy with hyper-inflation and massive capital flight leading to currency depreciations,China stood out with sterling performance。

China 2011 FDI up 9.7 pct to record $116 bln

Tue Jan 17, 2012 9:01pm EST

China 2011 FDI up 9.7 pct to record $116 bln | Reuters

BEIJING, Jan 18 (Reuters) - Foreign direct investment in China rose 9.7 percent in 2011 to a record $116 billion, though December's inflow of $12.24
billion was down 12.7 percent versus year ago levels, the Commerce Ministry said on Wednesday.

It was the second consecutive month that China's non-financial foreign direct investment (FDI) fell versus year-ago levels, signalling that once unabated capital flow into the world's second-biggest economy is faltering.

China's FDI inflow was down 9.8 percent in November from the same month in the previous year. It was the first fall in 28 months.

FDI inflow in December 2010 grew 15.6 percent at an annual rate to $14 billion, a record for any single month, and helped push overall flows for 2010
up 17 percent to $105.7 billion.

The Commerce Ministry said earlier this month it aimed to attract an average of $120 billion FDI in each of the next four years.

It also unveiled new rules to encourage foreign investment in strategic emerging industries, particularly those that bring new technology and know-how
to China.

Investment inflows, which surged in the years after China joined the World Trade Organisation in 2001, have recovered strongly after being hit hard by the
global economic slowdown in 2008/09.

China's foreign direct investment (in US$ billion):

________________________2011_________________________ __2010__


Dec Nov Oct Sep Aug Jul Jun May Apr Mar Feb Jan Dec Nov

12.2 8.8 8.3 9.0 8.4 8.3 12.9 9.2 8.5 12.5 7.8 10.0 14.0 9.7

The total FDI excludes investment in the financial sector. Some of the
monthly figures are calculated based on cumulative data.
 

cir

Senior Member
Joined
Dec 28, 2010
Messages
1,996
Likes
269
China can afford to choose, while its competitors can chase what's left behind。

China unveils new list of FDI likes and dislikes

BEIJING | Wed Dec 28, 2011 11:59pm EST

BEIJING Dec 29 (Reuters) - China no longer wants foreign-funded automobile factories or polysilicon plants, but would welcome overseas investment in hospitals and financial leasing firms, according to updated inward investment guidelines published on Thursday.

The 29-page list -- published on the website of China's economic planning agency, the National Development and Reform Commission (ÖлªÈËÃñ¹²ºÍ¹ú¹ú¼Ò·¢Õ¹ºÍ¸Ä¸ïίԱ»á) -- outlines sectors where foreign investors will be encouraged, restricted or completely banned.

The guidelines, effective from Jan. 30 2012, are the basis for a range of policies regarding foreign investors in China, from project approval to tax treatment and other items.

"The focus is to optimize the foreign investment structure, push forward technology innovation and industrial upgrading," the NDRC said in a statement.

Investments that bring new technology and know-how to China, as well as "green" businesses in areas like battery recycling, will be particularly welcome, NDRC added.

Foreign direct investment (FDI) inflows have been a key driver of China's economic growth in the last three decades.

China drew $103.8 billion in FDI in the first 11 months of 2011, up 13.2 percent from the same period in 2010. (Reporting by Zhou Xin and Kevin Yao; Editing by Nick Edwards)

China unveils new list of FDI likes and dislikes | Reuters
 

cir

Senior Member
Joined
Dec 28, 2010
Messages
1,996
Likes
269
This is the kind of FDI China needs, not chicken feeds。

China, Qatar to push for $12.6b refinery complex

January 20, 2012

Beijing: China's top energy group and its partners Qatar Petroleum and Royal Dutch Shell agreed to push ahead with plans for a $12.6 billion refinery and petrochemical complex in east China which is likely to start before similar rival facilities.

China National Petroleum Corp (CNPC) said yesterday it and its joint venture partners signed an agreement to cooperate further on the project while Chinese Premier Wen Jiabao was visiting Doha on Wednesday.

"The three parties will cooperate further to push for the implementation of the project. The investment is a major development that will deepen CNPC's cooperation with a major Middle East resource nation and an international oil company," CNPC, parent of PetroChina, said in a statement.

The project, which includes a 400,000-barrel-per-day (bpd) refinery and a 1.2-million-tonne-per-year ethylene complex, is one of several joint-ventures that China, the world's second biggest energy consumer, hopes will provide the fuel for its expanding economy.

The other projects include ventures between Chinese energy firms and Venezuela's PDVSA, Kuwait Petroleum International and Russia's Rosneft. China's total refining capacity stood at around 10 million barrels per day at the end of 2010. It is likely to add another 3.7 million bpd between 2011 and 2015, industry officials said.

The CNPC project, to be located in the east coastal city Taizhou, won initial government approval in June.

Industry experts said Qatar Petroleum and Shell would have to work hard at negotiating a final deal that allows them to take part in the more lucrative fuel retailing.

"The broad trend won't change — to limit investors' access to fuel marketing in favour of state majors," said Yan Kefeng of Cambridge Energy Research Associates (Cera).

"But to CNPC, this might be slightly different — the project would mean CNPC is giving its partners chance to grab market share in competitor's turf."

CNPC has also partnered Venezuela's state-run PDVSA for a refinery and petrochemical complex in Guangdong province, under which PDVSA will supply the crude and provide oilfield concessions to CNPC in Venezuela in return for a footfold in China's vast fuel market.

But industry experts say the deal could be caught in the web of sometimes tense diplomatic relations between the United States, China and Venezuela.

Sinopec has partnered with Kuwait's national oil company to set up a similar venture in Zhanjiang city. Industry experts expect negotiations for the final commercial contract to be lengthy as Sinopec could prove to be a tough negotiator and Kuwait Petroleum needs to find a global oil firm to partner with.

State firms dominate

China is hungry for fuel, but the refining business has long been dominated by state giants Sinopec and PetroChina and the government still sets prices at the pump.

Without full access to wholesale operations and what happens at fuel stations, refiners often bear the brunt of thin or negative margins.

The only success so far is the refinery-petrochemical venture between Sinopec, ExxonMobil and Saudi Aramco in the southern province of Fujian which took more than a decade to materialise.

gulfnews : China, Qatar to push for $12.6b refinery complex
 

cir

Senior Member
Joined
Dec 28, 2010
Messages
1,996
Likes
269
China not only attracts FDI, but also encourages export of capitals, some of which are to distant lands, as is evidenced by:

Agric Ministry receives $1.2bn investment for rice and rubber productions

Fri January 20, 2012

By Poindexter Sama

It was a complete show of an unwavering attempt by the Ministry of Agriculture Forestry and Food Security to improve the agricultural potentials of Sierra Leone, when one of China's biggest Agriculture Investment Companies, the Hainan Co., Ltd for International Economic Corporation, announced that they have approved the sum of one billion, two hundred and thirty-one million, nine hundred and eighty-six thousand and two hundred dollars (US$ 1,231,986,200) for the production of rubber and rice in the country.

"By finance value and land area, this is the biggest investment received by the Ministry in the area of rice and rubber productions, with a share capital of 50 million dollars" noted Sam Sesay, the Minister of Agriculture, Forestry and Food Security.

The Minister reaffirmed that since his ministry is poised to create an enabling environment for development of the private sectors participation in agriculture, the ministry had already entered into a joint venture with the Chinese company, in which they are ready to provide the land (300 acres) on which the company will establish its office, and a 40,000 hectares of land to cultivate large scale plantation in rubber and rice at Mile 91 in the North.

He revealed that from February to March this year, all documentary arrangements would have been made and practical activities would start at full swing.
The Minister in stressing the agricultural potentials, and the development the project would bring in the near future, regarded the project as a trade venture between the government of Sierra Leone and the Chinese government in respect of their bilateral relation that has existed for many years.

The rubber plantation project, the minister noted, will cover 81,000 tons of rubber and 35,000 hectares of rice produced every year, adding that the yearly net profit for rubber production would be in the tune of $138,335, 500 and rice at $ 81, 400 respectively.

Infrastructure wise, the project would facilitate the construction of 500 kilometers of trunk roads, 600 kilometers of feeder roads and other related social facilities during their period of operation.

Revealing job opportunities such the huge project would create, the Chairman of China Hainan Co., Ltd Mr. Zhou Chen said that the venture would bring over 100, 000 job opportunities and reduce the cost of rice.

He said considering the peaceful atmosphere for doing business in the country, the Chinese company which is ranked the 6th in the world for rubber plantation, and with 60 years of existence, they are ready to deliver their utmost best towards improving agriculture in the country to the level of exportation.
He said they have in their company advanced technical expertise that are readily prepared to embark on feasibility studies to determine the viability of the location for the multi-million project.

Agric Ministry receives $1.2bn investment for rice and rubber productions « Awoko Newspaper
 

cir

Senior Member
Joined
Dec 28, 2010
Messages
1,996
Likes
269
This is another area where FDIs are welcome。

A Chinese honey pot for manufacturers

KEN WILSON

16 Jan, 2012 02:00 AM

MAJOR world agricultural machinery manufacturers are ramping up investment in China, with CNH Global the latest to declare its hand.

Last week, the company announced it will build a new manufacturing plant in Harbin, northeast China, with an initial investment of $90 million.

Interestingly, the announcement came days after a report that China is planning to spend a lazy $160 billion this year to increase agricultural development.

The move is also focused on increasing farmers' incomes, sending fleeting thoughts to cash-strapped WA farmers of a lifestyle move.

China's finance minister Xie Xuren, said the majority of the money would be spent on water projects to increase water availability for irrigation.

"The central government has also urged financial institutions to increase lending to agriculture-related businesses through incentive policies," Mr Xie said.

Apart from CNH Global, other major manufacturers, including AGCO and John Deere, are positioning themselves in China, obviously keen to expand production of tractors, headers and sprayers.

According to CNH, its plans include a new factory to produce high horsepower tractors, combine harvesters and other machinery featuring advanced technology.

With this investment, CNH will expand its manufacturing base in China, where it currently assembles high horsepower tractors and other agricultural equipment in Harbin, and operates a manufacturing plant dedicated to low and medium horsepower tractors in Shanghai.

CNH CFO Richard Tobin, who will take over as president and CEO later this month, said China was an important market for the company.

"We strongly believe in its potential," he said. "CNH has invested in this country for more than 100 years, when the first International Harvester tractor was imported to China.

"We have since steadily developed our relationship with China and will continue to invest to ensure our customers have access to our best technologies and expertise."

CNH is a Chinese market leader in high horsepower tractors and harvesting equipment through its two agricultural brands, Case IH and New Holland Agriculture.

CNH is also present in China's construction equipment industry primarily through the distribution of Case excavators, backhoe loaders, skid steer loaders and other equipment.

The investment in a new manufacturing base will further strengthen CNH's position in China and will enable its agricultural equipment brands to contribute to the mechanization of the country's fast developing agriculture sector.

Meanwhile, China National Cereals, Oil and Foodstuffs Corp (COFCO), the largest State-owned agricultural conglomerate, last week announced it was making steady progress in its overseas investments.

According to COFCO chairman Frank Ning, the company plans to build up its global logistics and processing systems next year, handling products such as corn, soybeans, rapeseed oil, sugar and wheat, Ning said.

"Some deals are now being negotiated," he said. "We will invest wherever it is necessary.

"We have laid the groundwork for expansion."

In November, COFCO announced plans to invest overseas through mergers and acquisitions over the next five years.

The company will focus on a number of foreign markets including the United States, Australia and Southeast Asia.

Mr Ning sees it as opportune to seek foreign acquisitions, particularly in an economic climate where cheaper investments can be made.

A growing COFCO will make it more competitive in the global food industry.

China is the world's largest importer and consumer of a number of agricultural products including cotton and soybeans.

Analysts have forecast the nation will become the world's largest food importer within the next five to 10 years.

According to the Ministry of Agriculture, China's agricultural trade surged to $122b in 2010 from $28b in 2001.

Domestically, COFCO has expanded to cover agricultural production, processing and retailing.

The company has so far cooperated with more than 1.55 million farming households.

The farmers grow crops on 233,000 hectares of farmland for COFCO's processing businesses.

"The farmers trust COFCO because we are a State-owned company," Mr Ning said. "This is our advantage in competition.

"We intend to foster a whole business chain from farms to consumers' tables, and we will continue striving to create value for farmers."

Music to the ears of overseas manufacturers.

A Chinese honey pot for manufacturers - State News - Agribusiness and General - Finance - Farm Weekly
 

cir

Senior Member
Joined
Dec 28, 2010
Messages
1,996
Likes
269
Shanghai VW begins work on new Zhejiang production site

--------------------------------------------------------------------------------

By Carmen Lee

From Gasgoo.com

January 09, 2012

Shanghai Volkswagen has officially begun work on its new production site in Zhejiang's seaport city of Ningbo this weekend, with the joint venture holding a signing ceremony late last week, zjdaily.com.cn reported. Shanghai VW will be putting 11.76 billion yuan ($1.87b) into the new site, which will also attract investments from various auto part enterprises. It will boast an annual product capacity of 300,000 vehicles. The new production site, which will be equipped with state-of-the-art technology, will be a turning point for the province of Zhejiang, and will no doubt help attract new business interest to Ningbo.

Some analysts predict that Ningbo's auto part industry will grow by over 70 billion yuan ($10.99b) as a result of the new factory. As one of China's earliest foreign joint ventures, Shanghai VW has sites scattered throughout the country, with factories in Shanghai, Nanjing and Yizheng, Jiangsu.


The foundation laying ceremony was held in Ningbo on Jan 7, 2012
and the plant is scheduled to begin operations in 2013.
 

debasree

Regular Member
Joined
Feb 7, 2011
Messages
819
Likes
86
Country flag
is this the begining of the end of chineese economic boom members what d u think
 

Ray

The Chairman
Professional
Joined
Apr 17, 2009
Messages
43,132
Likes
23,834
It appears that the FDI is basically aimed at the domestic market, which is huge!
 

Armand2REP

CHINI EXPERT
Senior Member
Joined
Dec 17, 2009
Messages
13,811
Likes
6,734
Country flag
China as the primary outsourcing destination is seeing a quick end.
 

mylegend

Regular Member
Joined
Nov 30, 2011
Messages
430
Likes
96
Armand, I'm tired of responding to any of your comment. You have little to none knowledge about economics, and from what your other post, you ask some stupid question about some basic things... You spend much of your your time research about negative thing about Chinese economies all the times when you are not one of those investors tries to seek opportunity in a collapsed economy,,, It was funny when I saw u ask question in another thread that "RBIs policy was to slow economic growth?" well, if you increase your interest rate, economy will slow and inflation pressure ease. That is basic macro-economic you take in High-School... Man, you must have failed your economy course...

But you are right, over the long-term, China will no longer be a primary outsourcing destination. However, the shift will be slow because no other country will be able to ramp up their production quick enough. Cambodia for example, can not replace China, one is limit of their population, another is the corruption of their local government is even worse than China, worker's productivity also lag behind.

After all, most Chinese official have their future tied into ability to drive growth and attract investment. Although, they abuse their power at the same time...

And please, ask any investor, is it easier to invest in China than India, Bangladesh, and Cambodia. Many other country that should replace China in manufacturing outsourcing lack the infrastructure to absorb the change fast enough to have a strong short-term impact on Chinese economy.
 
Last edited:

amoy

Senior Member
Joined
Jan 17, 2010
Messages
5,982
Likes
1,849
Those names look familiar to me. Feng Tay for example has a heavy investment in my hometown city employing 30,000-40,000. It doesn't only manufacture for Nike but also for Reebok, Adidas and Footjoy (No.1 golf shoe brand worldwide). Actually its increasing capacity in VN didn't start recently. It dated back to many years ago but wasn't very smooth due to some restraints in VN. RMB appreciation + buoyant labor cost expedite the shift.

Eastman Kodak Co. has filed for bankruptcy protection. The news spells uncertainty for thousands perhaps, as Kodak has a big factory in the city I live.

It's understandable for your separate post on furniture manufacture moving back to the US. Apart from numerous factors mentioned such as labor cost (Chinese cost is up, while Amercian down), tightened environmental restriction, Yuan appreciation, shipping, and probably incentives for creating "American Jobs", Chinese furniture makers have to import most of wood then export finished goods. Under such circumstances it's more competitive (probably) to make it at home (US).

All in all it doesn't augur weel for China's export oriented sectors esp. in coastal areas. Many traders are looking into import for opportunities

Taiwanese firm steers Nike's shift from China to Vietnam

Vietnam surpassed China to become the largest producer of Nike shoes at the end of May last year. According to market observers, Nike's top manufacturer, Taiwan's Feng Tay Enterprise Co, played a key role in Vietnam's ascent.

Currently, Feng Tay, which manufactures shoes, clothing and sports equipment, produces one out of every six Nike shoes sold in the world. It shipped more than 60 million shoes in 2010.

Both Feng Tay and Yue Yuen attributed the shift in production away from China to increasing labor costs on the mainland and the yuan's appreciation in recent years.

Feng Tay added that the company is currently eyeing India as its new production site because of its reasonable labor costs, abundant labor pool and geographical proximity to Europe.

Taiwanese firm steers Nike's shift from China to Vietnam|Economy|In-depth|WantChinaTimes.com
 

Armand2REP

CHINI EXPERT
Senior Member
Joined
Dec 17, 2009
Messages
13,811
Likes
6,734
Country flag
Kodak Bankruptcy threatens 5,000 China jobs

Impact on China

Kodak (China) headquarters in Shanghai refused to comment on the latest development.

Kodak (China) has sub-branches in Beijing, Guangzhou, Xiamen and Shenzhen with three factories in Shanghai, Xiamen and Wuxi, employing a total of 5,000 employees.

The China Times, a Beijing-based business weekly newspaper, reported earlier that Kodak (China) had claimed that sales in China were growing gradually.

The company's China operations have not been reorganized and workers have not been laid off, the newspaper said.

A rival company said that the photographic film market has declined in recent years.

"We don't want to make any comment on the Kodak move but we've noticed that with the advanced development of digital cameras, the market for traditional film has suffered a downturn," said Liu Shengyin, PR manager for Fujifilm (China).

But the news boosted sales of Kodak film in Shanghai on Thursday. Zhang Liang, who runs a photography store in the city's Star Photographic Equipment Plaza, said he sold more than 400 Kodak films on Thursday, almost 10 times more than usual.

"Sales picked up all week, both online and in our actual store," said Zhang, adding that Kodak products were one of his shop's bestsellers.

"I received more than 80 online orders today - almost all asking for 10 or more Kodak films - most of them came after news of bankruptcy protection was confirmed," he said.

Rumors that the company might declare bankruptcy have been circulating for months, Zhang said.

That was part of the reason he decided to stock his warehouse.

Huang Kun, a 30-year-old photography enthusiast from Shanghai, brought 85 Kodak films on Thursday. "I suppose Kodak will increase the price," Huang said.

Huang said most of his purchases were Kodak professional-standard films as "my guess is that Kodak will re-emerge smaller, and specialize in producing professional-standard films".

The Kodak story was a hot topic on Sina weibo.

A large number of micro-bloggers expressed sympathy for Kodak while recalling their best Kodak memories.

Kodak set up more than 8,000 film-processing and developing stores by 2003 after it entered the mainland in 1994.

A Kodak moment to remember - China.org.cn
 

Godless-Kafir

DFI Buddha
Senior Member
Joined
Aug 21, 2010
Messages
5,842
Likes
1,837
Country flag
In the 80s and 90s i remember people talking about the quick demise of Japan and Taiwan economy. Taiwan and Japan where named as copy cats who made flimsy stuff with poor plastic but at the end of the 90s Japan became the 2nd largest economy in the world for its size surpassing every european nation by a long shot.

I am sure even the hand-loom owners in the 19th century said there quality can never be matched when Britian took their handlooms to Manchester and converted it as the power-loom which soon mass produced cotton garments at lower prices killing of the local industries and pushing india into deep poverty and famine.

When China is doing the same by takeing Western industries and doing it much cheaper they bicker and cry. However the west wont share the fate of the Indian small scale industry that supported millions like Handloom and carpentry industry because they are capitalists who thrive on competition and will find a way out, compared to the small scale local carpenter and weavers of the 19th century who did not have a clue what hit them.
 
Last edited:

p2prada

Senior Member
Joined
May 25, 2009
Messages
10,234
Likes
4,015
Everything is fine in China. All that gloom and doom better fits Europe today.

China will continue showing anywhere between 5 and 10% growth for the next 30 years at least, with 10% being higher today and slowly reducing as the economy grows bigger. All the investments in China today are big ticket investments, not those small things like shoe factories, toys, paints etc. It would be good if we manage to get such business here in India instead.

The Chinese population is rich enough internally to fund Europe's expansions alone, let alone China's. Heck they have over 100 Billionaires today compared to just 20 in 2007. No European country has even half that number. At the same time India has 58 today compared to 32 in 2007; behind US, China and Russia. Let's not forget we are still a poor third world country.

China may be our rival. But it does not mean we should look the other way for no apparent reason. Both China and India will have bigger economies and more FDI than any other country in the world even if we combine the entire EU as one single country in the next 20 years.
 
Last edited:

Ray

The Chairman
Professional
Joined
Apr 17, 2009
Messages
43,132
Likes
23,834
China is not our enemy.

At best, an adversary and nothing more sinister.
 

Armand2REP

CHINI EXPERT
Senior Member
Joined
Dec 17, 2009
Messages
13,811
Likes
6,734
Country flag
Layoffs spread to Chinese electronic giants

As US home-appliance giants have begun laying off employees, downsizing has spread to international companies with manufacturing bases in China.

The Chinese subsidiary of South Korea's LG Electronics said Dec. 22 that L&T Display Technology, a Xiamen-based joint venture between its affiliate LG Display and Taiwan's IT contract maker TPV Technology, began closing its operations Dec. 16, resulting in the loss of more than 2,000 jobs, according to the 21st Century Business Herald.

LG Electronics China began reorganizing its operations in the middle of this year. In September this year, its mobile phone research and development department in Beijing underwent a large-scale personnel reorganization after a year and a half of losses.

After the reorganizing, only 10 of the 150 employees of the R&D department were transferred to its Yantai manufacturing factory in Shandong. The rest of the department was laid off.

The utilization rate of LG Display's LCD module manufacturing factory in Guangzhou, which started operations in 2008, dropped to 75%, causing 20% of its employees to be furloughed.

Layoffs spread to Chinese electronic giants|Economy|News|WantChinaTimes.com
 

Armand2REP

CHINI EXPERT
Senior Member
Joined
Dec 17, 2009
Messages
13,811
Likes
6,734
Country flag
Nokia Siemens To Axe 4,000 Employees In China

Nokia Siemens Networks has announced plans to cut 17,000 employees around the world by the end of 2013, including about 4,000 mainland Chinese employees.

This is reportedly the largest layoff in the history of Nokia Siemens. According to the company, it had about 74,000 employees worldwide by November 1, 2011, which means one out of five employees will be cut. This new measure will reportedly save EUR1 billion in operating and manufacturing costs for the company.

Rajeev Suri, chief executive officer of Nokia Siemens, revealed the strategic adjustment during a conference call and said they are very unhappy with the current profit trend for the company. The telecom infrastructure industry is not a high return business anymore.

Link
 

Global Defence

Articles

Top