China Economy: News & Discussion

[amoy]

Test planting of saltwater rice begins

Renowned Chinese agricultural scientist Yuan Longping and his research team planted saltwater-tolerant rice on six plots of saline-alkali land on Monday.

It was the first time this kind of rice has been planted simultaneously on different types of such land, a major step in exploring its commercial viability.

The planting sites are in Kashgar, in the Xinjiang Uygur autonomous region; Daqing, Heilongjiang province; Dongying and Qingdao, Shandong province; Wenzhou, Zhejiang province; and Yan'an, Shaanxi province. The sites represent virtually every type of saline-alkali land in China.

So-called saltwater rice is designed to grow in tidal flats or other areas with heavy salt content.

"These planting practices aim to test saltwater rice's performance, yield, taste and cost when grown on different types of saline-alkali land," said Zhang Guodong, deputy director at the Qingdao Saline-Alkali Tolerant Rice Research and Development Center in Shandong province.

--
China has 100 million hectares of saline-alkaline soil.

Yuan and his team plan to develop a type of saltwater rice that can be planted on 6.7 million hectares of saline-alkali land around the country, which they estimate can yield 30 million metric tons every year, feeding an additional 80 million mouths.

Seawater rice goes to Middle East

China and the UAE plan to jointly promote seawater rice in the Middle East and northern African countries by establishing a seawater rice promotion center, Zhang added.

Experimental seawater rice planted in January in Dubai is expected to yield more than 500 kilograms per mu, the Science and Technology Daily reported

 

[Armand2REP]

Narrowly Escaping Default, China’s DunAn Group Continues To Sell Assets To Reduce Debt
Yimian WuMay 31, 2018 — 15:44 HKT

DunAn Group, a Chinese precision manufacturing and equipment maker amidst a debt crisis with total outstanding debt of RMB45 billion (US$7 billion), has been aggressively selling assets to reduce debt level.

The Hangzhou-based company canceled a new bond issuance earlier this month and was only able to pay for two bonds that were due with the help of the local government. Even though it averted the fate of bond default, DunAn’s debt crisis continues to unravel.

"The local government pays great attention to DunAn Group’s liquidity crunch. DunAn Group has set up a special committee to help with bond repayment and to reduce liquidity risk. So far, DunAn Group has paid a total of RMB1.9 billion (US$296.6 million) for two bonds due on May 9th and May 24th," said DunAn’s subsidiary Anhui Jiangnan Chemical Industry Co., Ltd., in a security filing.

DunAn Group has two listed companies, Anhui Jiangnan Chemical Industry and Zhejiang DunAn Artificial Environment Equipment Co. Ltd.

On May 30th, Zhejiang DunAn Artificial Environment announced plans to sell its subsidiary Zhejiang DunAn Energy Saving Technology Ltd to China Electronic System Engineering Company (CESEC). The total asset of the subsidiary being sold is about RMB7 billion (US$1.1 billion), and the selling price has not been determined.

DunAn and its subsidiaries are selling stocks it owns in other companies in order to raise cash. On May 26th, Zhejiang DunAn Artificial Environment said it would sell 6.09 million shares of Shenzhen Stock Exchange-listed Wuhu Conch Profiles and Science Co., Ltd. owned by it for RMB6.45 per share. The transaction would bring RMB39 million in proceeds for the company.

Anhui Jiangnan Chemical Industry also sold 6.58 million shares of Shanghai Stock Exchange-listed Xinjiang Xuefeng Sci-Tech for RMB4.7 per share. Anhui Jiangnan Chemical Industry also sold the same amount of shares in December, 2017.

https://www.chinamoneynetwork.com/2018/05/31/after-escaping-default-chinas-dunan-group-continues-to-sell-assets-to-reduce-debt

 

[Armand2REP]

Why China's Looming Debt Problems Won't Stop At Its Borders

• 
  Douglas Bulloch , Contributor I write about the political economy of China and its major industries Opinions expressed by Forbes Contributors are their own.
  
  
  
  
  
  Photographer: Qilai Shen/Bloomberg
  
  For some years now China has been building up its debt load very rapidly, to the point where some estimates of its size run as high as 328% of Chinese GDP. This is explained on the one hand by enormous stimulus measures in the aftermath of the global financial crisis, and just the simple business of prolonged loose credit conditions fueling the Chinese economy through state banks. Add to this the enormous growth in shadow banking and doubts about the reliability of the published figures, particularly with regard to non-performing loans, and you have a field of uncertainty to survey.
  
  Until now, the sense of crisis has been averted by well-timed reassurances from trusted actors, but also the fact that the economy does keep humming along, GDP keeps coming in on target, and underneath it all, this debt mountain is largely internal to China, protected behind the walls of a closed capital account. The normal conduits for a currency or financial crisis are simply shut. This doesn't mean, of course, that the problems disappear. Instead they will simply burden the Chinese economy for much longer, drive capital misallocation and await resolution by drastic internal policy intervention which itself will raise questions about China's governance and long term future development.
  
  Not the only debt crisis in town
  
  But apart from these well-documented problems, China has another kind of debt problem, one that we have also seen before. For along with China's growing economic footprint in the world of trade has come an equally large impression in the world of investment. In other words, China has become a significant creditor nation, lending money overseas to fund infrastructure and bailing out friendly governments. Occasionally such largesse comes with a few trifling strings attached, like a transfer of diplomatic recognition from Taipei to Beijing, or a handy veto in an important council meeting dealing with some entirely unconnected matter like human rights, but overall these sums have started to add up.
  
  
  
  
  
  
  CARACAS, VENEZUELA. (Photo by Roman Camacho/SOPA Images/LightRocket via Getty Images)
  
  It is rumored that Beijing has lent Venezuela more than $60 billion over the years, with tens of billions more committed to Argentina. Venezuela is now in a state of economic collapse, and Argentina has just applied to the IMF for a bailout. Both of these countries will inevitably see interest and debt repayments to China as a burden they cannot bear, and in the case of Venezuela, they would likely be right. The Belt and Road Initiative has already led to many loans of questionable value being offered to countries without any obvious means of repayment. Kenya has a new and exorbitantly expensive railway line that, so far, carries less than 20% of the freight it needs to break even. Laos is permitting Chinese construction workers to build a high-speed railway they don't need, and graciously allowing them to pay for 30% or it with interest-bearing loans. And lastly Sri Lanka's desire for a new port facility has now cost them the very port facility they paid for, on a 99-year lease to China.
  
  Nor is it just infrastructure, just last week, Pakistan borrowed $2 billion (on top of all their other loans from China) to ease a balance of payments crisis. The trouble with all this debt, however, is that eventually it becomes political. Populations tire of seeing their tax revenues drained from education or defence to pay interest on loans to indifferent foreign bankers, or worse, governments. Political movements rise up on the back of such resentments, and as with Malaysia two weeks ago, new governments–with new priorities–emerge.
  
  
  
  
  A campaign poster of former strongman Mahathir Mohamad is displayed along a street in Kuala Lumpur, Malaysia, Thursday, May 10, 2018. (AP Photo/Aaron Favila)
  
  We've seen it all before
  
  The 1980s Latin American debt crisis has to some extent passed into history, eventually subsumed into a wider campaign for a millennium debt jubilee for all developing countries and lessened by a period of high growth and high investment in the 1990s. Nevertheless it is remarkable how quickly we have forgotten its causes and lessons. So much so that we are ignoring the parallels between the buildup of debt in the 1970s, with what is taking place today under China's influence.
  
  For although the 1970s and 80s debt crisis had different origins, from a structural point of view they are comparable. The oil crises constituted supply shocks, which produced enormous windfall gains for Middle Eastern economies. These windfalls were deposited in international banks, which in turn lowered the cost of capital. This then facilitated cheap loans to Latin America and around the world to support import substitution industrialization and other economic pipe dreams, which resulted in serious capital misallocation and a build up of significant, unserviceable debt.
  
  Today, the huge supply shock comes from the productivity of China's cheap labor pool gaining access to Western markets. The consequent enormous build up of dollar reserves since about 2004 means there is a lot of capital around seeking a return and finding an outlet through Chinese government largesse, and there is every likelihood that a great deal of this capital will not generate a return sufficient to pay for itself.
  
  The problem is that when political winds change, and these loans stop being serviced, calls for a debt write-off will inevitably grow. And unless the Belt and Road Initiative actually generates a return it will be very hard to argue otherwise. In which case, China, like the West in the 1980s, will simply find itself counter-party to an awful lot unserviceable debt, and in no position to enforce its claims.
  
  https://www.forbes.com/sites/dougla...-it-is-also-exacerbating-others/#51d9d7413fc3
  

 

[Armand2REP]

Chinese high-yield bonds see prices plummet
June 01, 2018, 11:29:00 AM EDT By Reuters

LONDON, June 1 (IFR) - The unusual movements of some Chinese high-yield credits drew investors' attention last week, and not just China Energy Reserve and Chemicals Group, which said on Monday it had defaulted on its offshore debt.

Property developer Wuzhou'sHong Kong-listed shares plunged by 85% on May 25 on negative news reports in China before trading was suspended. Its US$300m of 13.75% US dollar bonds due September 2018 slumped more than 20 points on the same day and were last quoted at 45/50.

Huachen's US$500m 6.625% bonds due 2020 sold off by around 15 points on May 28 after its Shanghai-listed parent Wintime Energy's onshore bonds fell the previous week.

"We didn't know the exact reasons that triggered the sudden fall [in bond prices] as some of the negative headlines came out a few days before the unusual movements," a portfolio manager at a Chinese fund house said.

"For Wuzhou, it was obvious that the stock price collapse triggered the fall in bond prices, but it is still hard to explain the unusual movements of its shares."

Wuzhou remains suspended and had yet to give an explanation for the unusual movements at the time of writing.

The company is rated Caa1 (negative) by Moody's and its bonds are rated Caa2. Fitch on May 17 withdrew its CCC ratings on the company and its bonds, saying that Wuzhou had stopped providing the information it needed to maintain the ratings. Moody's has a B1 (stable) rating on Huachen and a B2 rating on its bonds.

Oceanwide's US dollar curve slumped by 3-10 points on May 31 after S&P and Fitch cut its ratings.

S&P on May 30 downgraded the China-based property developer and financial holdings group's rating to CCC from B- and its outstanding senior unsecured notes ratings to CCC- from CCC+. Fitch has downgraded Oceanwide and its bond rating to B- from B.

S&P warned that Oceanwide has "significant refinancing uncertainty" over its large outstanding debt maturities, including its US$200m of 6.50% notes due in July 2018 and US$600m of 9.625% notes due 2020 but puttable in August 2018.

Oceanwide, a frequent issuer in the offshore market, has held a call with investors and hinted at a potential exchange offer for the puttable bonds.

Another eye-catching credit last week was Qinghai Investment, which is rated BB- by S&P. The provincial-level aluminium-to-hydropower SOE's US dollar bond curve was down 2-7 points on May 30 without an obvious reason, although there were rumours that it was mulling new bond issues.

Guorui's bonds plummeted on May 31 after it said it was planning to issue more debt. Its 7.00% 2020s fell 15 points while its 10.20% 2019s fell 4-5 points on the day. Despite the plunge, the property developer still managed a US$100m two-year US dollar private placement at par to yield 10.00% via Haitong International.

Its 7.00% 2020s recovered slightly to 78.5/85.0 on June 1, while its 10.20% 2019s also rose and were quoted at 91.255/93.255, according to Tradeweb. Both bonds still yield more than 20% on the bid side.

Market participants said higher US rates, heavy supply, trade tension between the US and China, and now Italy's latest bout of political uncertainty, have raised refinancing risks for lower-rated borrowers.

A DCM banker from a Chinese brokerage said privately owned companies and weak LGFVs were more vulnerable amid China's deleveraging campaign.

"There is increased differentiation of credit risk this year as the market turned weak," the banker said. "For some issuers, it is not a question of how much they're willing to pay. They just cannot find enough interest from investors."

https://www.nasdaq.com/article/chinese-highyield-bonds-see-prices-plummet-20180601-00656

 

[sthf]

Chickens are coming home to roost for Chinese companies specifically and economy in general. Mindless, debt fueled expansion was going to catch up eventually. This is not to say that doomsday is coming but messed up macroeconomic fundamentals that put premium on short term gains post 2008 depression against long term stability will bite China in the ass.

 

[amoy]

China's Sinopec to boost U.S. crude imports to all-time high: sources

The company's trading arm Unipec has bought 16 million barrels, or about 533,000 barrels per day (bpd), of U.S. crude to load in June, they said, the largest volume ever to be lifted in a month by the company.

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Unipec's June oil purchases would be worth about $1.1 billion at current prices . They would represent a notable increase in China's imports of U.S. crude, which have averaged about 330,000 barrels a day for the six-month period ended in February, according to U.S. Energy Department data.

An arbitrage opportunity has also opened up after U.S. crude futures recorded the widest discount in three years against Brent at $8.06 a barrel last week, enabling Unipec to boost imports to replace more expensive Middle East oil.

Washington is keen to sell more of the country's surging oil and gas production. However, U.S. energy exports can grow only gradually due to infrastructure bottlenecks, and only if U.S. oil, gas and other goods remain attractively priced compared with global competition.

China’s No.1 Oil Company Cuts Saudi Crude Imports

China’s Sinopec will cut its June imports of crude from Saudi Arabia by 40 percent for the second month in a row because of unjustified high prices, an official from the top Asian refiner, Unipec, told Reuters.

 

[amoy]

China to cut import tariffs for 1,449 taxable items of daily consumer goods

On average, the tariffs were cut by 55.9 percent, said the Customs Tariff Commission of the State Council.

--

The average tariff rate for clothing, shoes and hats, kitchenware, and sports and fitness supplies will be reduced from 15.9 percent to 7.1 percent, and that for home appliances such as washing machines and refrigerators from 20.5 percent to 8 percent.

The average tariff rate for cultured and fished aquatic products and processed food such as mineral water will be cut from 15.2 percent to 6.9 percent, according to a statement released after the meeting.

The average tariff rate for detergents, cosmetics such as skin care and hair care products, and some medicine and health products will be cut from 8.4 percent to 2.9 percent.

 

[Armand2REP]

Cash-strapped Chery to sell controlling stake

2018-06-04 14:26:49China Daily

Chery Automobile Co has decided to trade its controlling stake for at least 20 billion yuan ($3.12 billion) as part of efforts to reboot itself in an increasingly competitive Chinese market.

The proposal was unanimously approved at the cash-strapped State-owned carmaker's workers' meeting on Tuesday because of a "pay rise promise" and hopes of a turn in the company's fortunes for the better, according to Chinese-language newspaper Securities Daily.

Last year, Chery's total deliveries in China fell 3.5 percent year-on-year to 680,000 vehicles, a far cry from its sales target of at least 900,000 units.

Its net profit in the year stood at 264 million yuan, some 60 million yuan less than the previous year. Its debt hovered at around 61.2 billion yuan by the end of 2017, up 7.33 percent from the previous year.

Established in 1997, Chery was once a popular carmaker in the country, becoming the first Chinese manufacturer to produce 1 million vehicles annually in 2007.

However, its sales have been falling since 2010 because of much more intense competition in the market and the poor positioning of its offerings. Chinese magazine Caixin said Chery's debt-to-asset ratio has hovered at around 75 percent over the past few years, while analysts said the percentage should stay between 40 and 60 percent for most usual automakers. The stake-for-cash deal is expected to be sealed in June, but Chery's largest shareholder so far, the government-controlled Wuhu Construction Investment, will retain veto powers to ensure the company does not move operations out of the province, according to Caixin. Its other two shareholders are Wuhu Ruichuang Investment owned by Chery Chairman Yin Tongyue and Huatai Securities, which was shown to become a shareholder two months ago, according to the National Enterprise Credit Information Publicity System.

http://www.ecns.cn/news/economy/2018-06-04/detail-ifyuurnp0999221.shtml

 

[rockdog]

PSA-Dongfeng China sales fall 38% in August
September 15, 2017 11:58 CE

http://europe.autonews.com/article/20170915/ANE/170919790/psa-dongfeng-china-sales-fall-38-in-august

Dongfeng Peugeot Citroen Automobile, PSA Group's joint venture with Dongfeng Motor in China, continues to lose market share, with August sales tumbling 38 percent to 26,205 vehicles.

In the first eight months, the partnership's sales plummeted 46 percent from a year earlier to 195,138, according to figures disclosed by Dongfeng, a state-owned Chinese company.

Dongfeng didn't release sales results for individual models produced by the joint venture.

PSA expects the locally built Peugeot 5008 SUV, which hit the market in June, to reverse the sales slump.

The venture, based in the central China city of Wuhan, assembles Peugeot and Citroen cars and light trucks.

PSA also runs a joint venture with state-owned Chinese automaker Changan Automobile in China.

Changan PSA, located in the south China city of Shenzhen, builds the Citroen DS models. The latest sales results for the joint venture are not available since Changan stopped releasing results in July.

In the first six months, Changan PSA's sales tumbled 64 percent year on year to only 3,157 vehicles, according to Changan.

PSA does not disclose sales of its two joint ventures in China.

While PSA's sales weakened, the overall Chinese light-vehicle market grew the past three months.

In August, car and light-truck deliveries in China rose 4.1 percent year on year to approach 1.88 million boosted by strong crossover and SUV demand. Through August, light-vehicle deliveries across the country increased 2.2 percent to top 14.8 million vehicles.

 

[Armand2REP]

China ‘insurtech’ pioneer ZhongAn loses lustre on bubble worries
Former high flyer backed by Tencent and Ant Financial now 12% below IPO price

Eight months after its much-heralded initial public offering in Hong Kong, ZhongAn Online Property & Casualty, the fintech insurer backed by China’s two biggest internet tycoons, is struggling to meet lofty expectations, highlighting concerns about a China tech bubble.

On Monday, ZhongAn’s shares were 12 per cent below the initial public offering price — and 46 per cent below their record high on October 9 — even as a broad index of Hong Kong-listed mainland groups gained 12 per cent in the same period. Its market capitalisation stood at $9.8bn, according to Thomson Reuters.

When ZhongAn debuted in Hong Kong in September, investors flocked to the world’s first “insurtech” listing, which seemed to offer exposure to multiple sectors of China’s emerging consumer economy, including travel, healthcare and consumer lending.

The company’s powerful backers provided additional reason for optimism. Alibaba chairman Jack Ma, Tencent chair Pony Ma and Ma Mingzhe, chairman of PingAn Insurance, are known collectively as the “three horses” because their shared surname is the Chinese character for horse. The three companies jointly founded Shanghai-based ZhongAn in 2013.

Beyond their prestige, the three horses’ backing offered the prospect that ZhongAn would enjoy privileged access to the three companies’ vast troves of user data, enabling the insurer to target customers and design products tailored to their needs. Big data would replace the legions of insurance agents whose hefty sales commissions eat into profit margins for traditional insurers.

But the company’s latest financial results reveal a problem: instead of paying agents to sell products, ZhongAn is paying “ecosystem partners” like Ant Financial, Tencent and online travel agency Ctrip to generate premiums. To some observers, the strategy is reminiscent of other tech start-ups in both China and Silicon Valley that used plentiful venture-capital funding to spend lavishly on winning market share growth, even as profits remain elusive.

“They are achieving what I call empty growth: growing fast and paying ridiculously high commissions to win unprofitable business,” said Sam Radwan, principal at Enhance International, a consultancy that advises Chinese insurers.

https://www.ft.com/content/88bccce4-631b-11e8-90c2-9563a0613e56

 

[Yggdrasil]

Cash-strapped Chery to sell controlling stake

2018-06-04 14:26:49China Daily

Chery Automobile Co has decided to trade its controlling stake for at least 20 billion yuan ($3.12 billion) as part of efforts to reboot itself in an increasingly competitive Chinese market.

The proposal was unanimously approved at the cash-strapped State-owned carmaker's workers' meeting on Tuesday because of a "pay rise promise" and hopes of a turn in the company's fortunes for the better, according to Chinese-language newspaper Securities Daily.

Last year, Chery's total deliveries in China fell 3.5 percent year-on-year to 680,000 vehicles, a far cry from its sales target of at least 900,000 units.

Its net profit in the year stood at 264 million yuan, some 60 million yuan less than the previous year. Its debt hovered at around 61.2 billion yuan by the end of 2017, up 7.33 percent from the previous year.

Established in 1997, Chery was once a popular carmaker in the country, becoming the first Chinese manufacturer to produce 1 million vehicles annually in 2007.

However, its sales have been falling since 2010 because of much more intense competition in the market and the poor positioning of its offerings. Chinese magazine Caixin said Chery's debt-to-asset ratio has hovered at around 75 percent over the past few years, while analysts said the percentage should stay between 40 and 60 percent for most usual automakers. The stake-for-cash deal is expected to be sealed in June, but Chery's largest shareholder so far, the government-controlled Wuhu Construction Investment, will retain veto powers to ensure the company does not move operations out of the province, according to Caixin. Its other two shareholders are Wuhu Ruichuang Investment owned by Chery Chairman Yin Tongyue and Huatai Securities, which was shown to become a shareholder two months ago, according to the National Enterprise Credit Information Publicity System.

http://www.ecns.cn/news/economy/2018-06-04/detail-ifyuurnp0999221.shtml

Not sure how this reflects on the Chinese economy. It's simply a story of a company failing to maintain its market share because of poor business practices, poor marketing, and general non-competitiveness. Could happen in any country, like what happened to GM in the US.

 

[Armand2REP]

Not sure how this reflects on the Chinese economy. It's simply a story of a company failing to maintain its market share because of poor business practices, poor marketing, and general non-competitiveness. Could happen in any country, like what happened to GM in the US.

You don't see how a multi-billion dollar Chinese company going under isn't related to the Chinese economy? If GM was going under that would be major economic news in the US.

 

[Armand2REP]

Korean investors set to sue China for it's crappy ratings agencies


[THE INVESTOR] China Energy Reserve & Chemicals Group, which has the backing of oil giant China National Petroleum Corp., told Korean investors that it will come up with a plan to repay the US$350 million of debt it defaulted on by the month-end, industry sources said on June 5.

A group of representatives comprising seven Korean financial institutions that were involved in selling or investing in the asset-backed commercial papers of affiliate CERCG Overseas Capital in Hong Kong visited the Chinese company’s headquarters on June 4 to discuss the default risk triggered by its failure to repay the debt it guaranteed earlier in May.

The default raised the possibility of a cross-default on two sets of offshore bonds backed by the Chinese oil and gas firm including asset-backed corporate paper worth 165 billion won worth (US$153 million) issued in Korea.

It is also igniting a so-called “China-phobia” in the Korean debt market where Korea-listed Chinese companies have a negative image due to accounting fraud and false disclaimers.

“We feel duped because we had no idea that CERCG would default since we thought it was backed by the Beijing municipal government, and had high credit ratings,” an official at a Korean institutional investor said on the condition of anonymity.

On May 8 -- only three days before the default was announced citing liquidity problems -- Hanwha Investment & Securities and Ebest Investment & Securities issued the CPs for CERCG Capital, with two credit agencies giving the bonds high ratings. Five other financial companies including HMC Investment Securities and Securities and KTB Asset Management invested in the CPs, with their investment ranging from 60 billion won to 15 billion won for each companies.

The Korean firms are demanding early repayment of the 165 billion won debt and collateral.

The Chinese company was reluctant to accept the demands, saying it plans to resolve the problem by injecting funds by raising capital from the largest shareholder or investment placement to repay the US$350 million it has defaulted on, the sources said.

Korean rating agencies Nice Investors Service and Seoul Credit Rating are now facing criticism for giving a high rating of A2 to the CPs, which they did because they considered CERCG as state-owned. That’s not the case, although the company’s largest shareholder is the Beijing municipal government.

The agencies have cut the rating to C following the cross-default.

Gripped with concern, five of the Korean financial companies that invested in the CPs are mulling a lawsuit against Hanwha and Ebest, if CERCG fails to repay the debt.

http://www.theinvestor.co.kr/view.php?ud=20180605000769

 

[rockdog]

Chinese banks held on to the top three spots in the FORBES Global 2000, a comprehensive annualranking of the world’s largest public companies. 2018 RANKING

https://www.forbes.com/global2000/list/#tab:overall

 

[john70]

Newspaper headline: Indian CEOs dominate in US

As Indians outperform Chinese in overseas corporate management, experts say China must nurture home-grown talent to catch up

http://www.globaltimes.cn/content/1106620.shtml

By Ma Jingjing Source:Global Times Published: 2018/6/12 17:13:40
1

Google Inc CEO Sundar Pichai talks to a group of women and girls who learn mobile internet skills via Google, in a village west of Kolkata, India, on January 5, 2017. Photo: VCG




Indians seem to have outperformed Chinese in terms of their presence in the corporate management world, with more Indians holding CEO positions in large multinational companies in the US such as Google and Microsoft. What's the reason behind this disparity? The Global Times spoke with two businesspeople - one Indian, the other Chinese - to find out. According to them, India's advantages in nurturing talent and in language makes it easier for Indians to adapt to different cultures, while Chinese students who studied in the US prefer to come back to China and focus on the Chinese economy.

In recent years, more Indians, including Indian-Americans, have taken up high-level management posts in large multinational corporations in the US compared to Chinese, with India-origin CEOs now leading Google and Microsoft.

Sundar Pichai, who was born in Tamil Nadu, India, was appointed CEO of Google in August 2015, while Satya Nadella, who was born in Telangana, India, became Microsoft's CEO in 2014.

In addition to those two representatives, the CEOs of SanDisk, Adobe Systems, PepsiCo, Harman International and Cognizant are all of Indian origin.

By contrast, there are barely any CEOs of large companies in the US who originate from the Chinese mainland.

So why are so many Indians becoming CEOs of multinational companies, while businesspeople from the Chinese mainland lag behind?

Popularization of MBA

Different from China, MBA degrees have become common for university students in India.

"Most of my friends pursued an MBA degree after undergraduate study. The institutions where we did our MBAs were some of the top business schools in India, and then we managed to get jobs with some of the better-known corporations, banks or consulting firms," said Sumeet Chander, country head of global professional services provider Evalueserve.

Chander is from India and manages the company's China operations in Shanghai.

Generally speaking, holding a bachelor's, master's, especially an MBA, or even a PhD degree in engineering has become standard for CEOs of Indian origin in US high-tech firms. This trend is demonstrated in the profiles of the CEOs of Google, Microsoft, Adobe, SanDisk and many other firms, said Chris Dong, global research director at technology advisory firm IDC China, who is based in both the San Francisco Bay Area and Beijing.

Dong, who studied in the US during the 1990s for his master's degree, worked as a software design engineer at Microsoft for more than six years and the director of strategy and operations at Cisco for nearly a decade.

"Most Indians at US high-tech firms seem to follow the same career path: They start as an engineer and then manage products. It's crucial for those who wish to pursue high-level management posts, as rotations in different product or business units help one better understand the firm's strategies and operations," Dong said.

Take Google's CEO for example. Prior to joining Google in 2004 as a vice president of product management, Pichai worked with the engineering and product management divisions of semiconductor maker Applied Materials Inc, as well as at McKinsey & Co in management consulting.

On the contrary, most Chinese engineers prefer to pursue a career on the technical ladder.

Easier adaption

Aside from Indian businesspeople's strong educational backgrounds, their willingness to adapt and lead also helps them in big global companies, according to experts.

"Most of the good students in India tend to be proficient in English, so when they move to the US, Canada or the UK, it's relatively easy for them to adapt," Chander said.

"Interestingly, most Chinese prefer to move back to China [in the long run] for work. Also, sometimes language is an issue, especially for first-generation folks who move to the US. So adapting takes longer," he noted.

Meanwhile, Indians are more adaptive and more willing to express themselves and get recognition, Dong said. "It's common to see Indian students developing friendships with Americans and those from other countries and regions, while most Chinese students are confined to their small circle."

During the 2016-17 academic year, 350,755 Chinese students enrolled in US universities, up 6.8 percent year-on-year, while the number of Indian students grew 12 percent year-on-year to more than 185,000, the fastest recorded growth rate, according to a report released in November 2017 by the Institute of International Education, a nonprofit organization supported by the US government.

Another key factor is the recognition of Indian talent by US firms, Dong noted.

"Foreign companies are more willing to set up outsourcing centers and research centers in India, which is beneficial for the nurturing of global and high-end talent," Dong said, noting that the R&D investment budgets of US firms in India is generally two or three times that of such budgets in China.

In fact, India is a quickly emerging global R&D hub, with around 30 percent of the top 1,000 global R&D spending organizations hosting centers there, according to a report released by the India Brand Equity Fund in June 2017.

China catching up

China's nurturing of innovation talent could be accelerated, if the country is willing to establish a more open market for both local and foreign technology players, such as those in the enterprise software and services sector, especially cloud-based platforms and software service providers, Dong said.

He also added that this will enable China to play more competitively in an open market and to share, compete with and utilize best-of-the-breed knowledge and skills.

"I do think that there will be a lot more internationally acclaimed CEOs from China in the future, but a lot of them will be working from China and not in the US going forward," Chander told the Global Times.

"Most smart Chinese folks would like to focus on the Chinese economy, which is likely to become larger than any other economy in the world."

 

[amoy]

China plans to raise personal income tax threshold

China's personal income tax threshold is expected to rise to 5000 yuan ($775.5) per month from the current 3500 yuan level, according to the amendment draft on individual income tax submitted on Tuesday.

The amendment is the seventh tax overhaul since the personal income tax code of 1980.

For the first time, the taxation is expected to cover all personal income, including income from personal services and rewards and royalties writers earn.

Also for the first time, the following items are deductible from personal tax, such as the cost of children’s education and continuing education, medical fees for major diseases, interest on housing loans as well as housing rent.

The draft on individual income tax has been submitted to the bimonthly session of China's legislative body, the Standing Committee of the National People's Congress, for the first discussion on Tuesday.

Discussion for the tax code revision will touch upon proposing tax deductions in children's education expenditures, medical treatment costs, housing loan interests, and housing rents, according to the draft.

Other possible adjustments include improving the tax rate structure and introducing anti-avoidance clause, according to the draft.

China's total tax revenue in 2017 increased by 10.7 percent year-on-year to 14.4 trillion yuan, according to data from the Ministry of Finance.

Tax revenue from individuals went up by 18.6 percent year-on-year to 1.2 trillion yuan during the same period, official data showed.

 

[amoy]

China plans to raise personal income tax threshold

China's personal income tax threshold is expected to rise to 5000 yuan ($775.5) per month from the current 3500 yuan level, according to the amendment draft on individual income tax submitted on Tuesday.

The amendment is the seventh tax overhaul since the personal income tax code of 1980.

For the first time, the taxation is expected to cover all personal income, including income from personal services and rewards and royalties writers earn.

Also for the first time, the following items are deductible from personal tax, such as the cost of children’s education and continuing education, medical fees for major diseases, interest on housing loans as well as housing rent.

The draft on individual income tax has been submitted to the bimonthly session of China's legislative body, the Standing Committee of the National People's Congress, for the first discussion on Tuesday.

Discussion for the tax code revision will touch upon proposing tax deductions in children's education expenditures, medical treatment costs, housing loan interests, and housing rents, according to the draft.

Other possible adjustments include improving the tax rate structure and introducing anti-avoidance clause, according to the draft.

China's total tax revenue in 2017 increased by 10.7 percent year-on-year to 14.4 trillion yuan, according to data from the Ministry of Finance.

Tax revenue from individuals went up by 18.6 percent year-on-year to 1.2 trillion yuan during the same period, official data showed.

 

[ezsasa]

China plans to raise personal income tax threshold

China's personal income tax threshold is expected to rise to 5000 yuan ($775.5) per month from the current 3500 yuan level, according to the amendment draft on individual income tax submitted on Tuesday.

The amendment is the seventh tax overhaul since the personal income tax code of 1980.

For the first time, the taxation is expected to cover all personal income, including income from personal services and rewards and royalties writers earn.

Also for the first time, the following items are deductible from personal tax, such as the cost of children’s education and continuing education, medical fees for major diseases, interest on housing loans as well as housing rent.

The draft on individual income tax has been submitted to the bimonthly session of China's legislative body, the Standing Committee of the National People's Congress, for the first discussion on Tuesday.

Discussion for the tax code revision will touch upon proposing tax deductions in children's education expenditures, medical treatment costs, housing loan interests, and housing rents, according to the draft.

Other possible adjustments include improving the tax rate structure and introducing anti-avoidance clause, according to the draft.

China's total tax revenue in 2017 increased by 10.7 percent year-on-year to 14.4 trillion yuan, according to data from the Ministry of Finance.

Tax revenue from individuals went up by 18.6 percent year-on-year to 1.2 trillion yuan during the same period, official data showed.

Are farmers taxed for personal incomes in china?

 

[amoy]

Are farmers taxed for personal incomes in china?

No. There used to be an Agricultural Tax but it was abolised in 2006.

China's Legislature Abolishes 2,600-year-old Agricultural Tax

agriculture contributed to 13.1 percent of the nation's gross domestic product (GDP) in 2004, and industry and tertiary trade contributed to 46.2 percent and 40.7 percent respectively.

 

[Armand2REP]

No. There used to be an Agricultural Tax but it was abolised in 2006.

China's Legislature Abolishes 2,600-year-old Agricultural Tax

agriculture contributed to 13.1 percent of the nation's gross domestic product (GDP) in 2004, and industry and tertiary trade contributed to 46.2 percent and 40.7 percent respectively.

They abolished that and instituted VAT. The current rate is 11% on all produce sold.