China Herald: 03/01/2009

Tuesday, March 31, 2009

The paperback edition - Victor Shih

The groundbreaking book by Victor Shih, Factions and Finance in China: Elite Conflict and Inflation is now available in its paperback edition. The book is a necessary tool for those

Victor Shih by Fantake via Flickr

who are interested in how China's government really works.

Too often China's government is perceived as a top-down organization, but internal turf fights and struggles to get consensus on different levels are features that are much more important to get a good understanding on how the administration works. Victor Shih describes very detailed how that process works and is a must-read for everybody who is working with political entities in China on different levels.

You can order the book here.

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Victor Shih is also a speaker at the China Speakers Bureau. If you are interested in having him as a speaker, do get in touch.

Monday, March 30, 2009

The battle for market share: who is losing?

Image via Wikipedia

Chinese private companies are closing in on foreign ventures as a percentage of the industrial output, writes the China Daily in an overview of economic developments over the past decade. The figures are certainly interesting, but those who are familiar with this weblog must know that I do not see media like the China Daily as a product of journalism, but a tool in explaining the government policies. That makes the paper interesting, but for other reasons than you might think at first glance.
The story here is that private companies are winning market share, from almost zero at the end of the 1990s to over twenty percent in 2007. Of course, our heartfelt congratulations to the private companies, but these statistics are very much the product of Beijing spindoctors.
What is wrong with the first graphic? Indeed, private companies are going up very fast and there is a little dent in the industrial output of foreign ventures or joint ventures. But that is only since 2004 a few percent points. Still interesting, but unfortunately, the real sucker is missing. So, who might have lost over more to the private companies? Was there not this other category of state-owned companies?
So, what is interesting is that the Beijing spindoctors obvious could not write an articles showing that state-owned companies are losing out, so they picked on foreign companies. Unfortunately, even statistical nitwits like me can see that something is rotten here. Time for better spindoctors?

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Are you interested in what is going on in China's economy or its media? At the China Speakers

Rupert Hoogewerf by Getty Images via Daylife

Bureau we have the experts who can help you out. Do get in touch if you need a China speakers at your conference.

Thursday, March 26, 2009

Chinese earn more, save more - Zhang Jun

Zhang Jun

The income of most Chinese citizens has gone up much during the past decade, but most of the extra money is not being spend but saved, says Fudan economics professor Zhang Jun at NPR.

"What we see in the last 10 years is a declining share of consumption spending relative to GDP."
And when it comes to the national savings — which include savings by businesses and governments — according to Chinese figures in 2007, China saved the equivalent of 49.9 percent of its GDP. This has contributed to huge global trade imbalances: Chinese savings have in effect been funding American spending. So, according to Zhang, stimulating Chinese consumption can only have a limited effect."
In the short run, it doesn't solve the problem of the global imbalance," he says. "We could say to the U.S. side that the U.S. needs to save more, so that they could ease the problem of the global imbalance."

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Professor Zhang Jun is also a speaker at the China Speakers Bureau. When you want him to share his insights at your conference, do let us know.

Wednesday, March 25, 2009

KFC China succes might not last - Warren Liu

Warren Liu

Our celebrity author Warren Liu, writer of a book about the success of KFC in China, made it today into the INSEAD Knowledge. In the article Warren Liu explains why that KFC success in China may not last.

Yet for all its hits, there are already rising brands that are not the KFCs or the Burger Kings or the McDonald’s. Liu says that Wei Qian La Mian, also known as Ajisen Ramen, is a Japanese product that has been doing very well in various cities throughout China. So is Zhen Gongfu or Real Kung-fu, a Chinese fast food chain which is showing a lot of promise. The competition has even gone hi-tech.
“I recently heard about a robot developed with subsidy from the Chinese government which is capable of preparing dozens of popular Chinese dishes at high speed, and with excellent taste, based on expert knowledge.”

Flavor, quality and pricing are now the points to look at, stresses Liu, not the introduction of more and more new products, since that only detracts the customer.

“While the ‘Taiwan Gang’ - the original leaders of the KFC team - played its historical
Image via Wikipedia
mission exceptionally well during the first two decades, it’s time for the baton to be passed on to the local Chinese – not for any altruistic reasons, but simply because the locals understand this market even better than the ‘Taiwan Gang’”, he says in his book.

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Warren Liu is a speaker at the China Speakers Bureau. When you need him as a speaker, not only about KFC but about a wide range of China related subjects, do get in touch.

Lessons from the failed Coca Cola-Huiyuan deal - Shaun Rein

Shaun Rein

Consumer market expert Shaun Rein has a thorough look at the failed US$ 2.3 billion acquisition deal between Coca-Cola and China's leading drinks maker Huiyuan in Forbes. While praising Coca Cola for going after the right consumer segment, Rein says that the US company failed to take China's anti-monopoly laws serious.

Coca-Cola thought the government wouldn't mind the sale of a nonstrategic asset, but a simple reading of the relevant Chinese laws would have shown that the government doesn't want foreign firms to buy controlling stakes in large national players that don't need financial or management help.

Much more at Forbes.

Commercial Shaun Rein is also a speaker at the China Speakers Bureau. When you need his insights at your conference, do let us know.

China Daily and police detention centers

Image via Wikipedia

Apologies for ignoring too many important developments lately, but - hey - sometimes we do have to make a living too. So I had no time to give my take on the apparent rise in death penalties in 2008, but do have to make a short remark about the China Daily who, here according to The Peking Duck, is about to become a real newspaper by slamming the police detention centers.

Inmates in China’s 2,700 pretrial detention centers suffer bullying and torture at the hands of fellow prisoners and police officers, and some experts want a neutral body to take the centers out of police control to curb the abuses, the state-run English-language newspaper, China Daily, reported on Tuesday.

Unfortunately, this dispatch does not carry the hallmarks of excellent or even emerging journalism, but of an internal power struggle in the Chinese bureaucracies, where the China Daily is siding with the central government.
The extra-legal powers by police and other security forces have been reduced greatly since the beginning of the 1990s. Arbitrary arrests and detentions for almost anything considered now normal was possible in those days and indeed sometimes happened. Homosexuality, extramarital affairs, living together unmarried, all those things could be reason enough to put Chinese citizens behind bars, without the interference of any court.
Those police powers have been reduced greatly, but the detention centers and indeed occasional extra-legal arrests are still there and sometimes used, although in terms of numbers not comparable with the past.
Internationally those detention centers have been a huge embarrassment: officially China is making great leaps forward to the rule of law, while security forces still maintain their detention centers. (I would not call them illegal, as you noticed, but rather extra-legal.) While security forces have lost much of their non-legal power over the society, the central government has never been able to get those detention centers actually closed.
So, when the China Daily suddenly writes about these centers, it is a sign that bureaucracies are clashing internally and the central government is mobilizing support - possibly also internationally - to get those detention centers closed. There is no possible link with journalism here.

Tuesday, March 24, 2009

Rock, free of commercial pressure - Kaiser Kuo

Kaiser Kuo

CNN's Talk Asia has investigated the Beijing Rock scene (h/t Danwei). Of course, rock star Kaiser Kuo is one of the main sources of knowledge, as the founder of "Tang" in the 1990s and one of the first rock bands in China.
Because it is rather marginallized in China, the rock scene in China is also free of commercial pressure, says Kaiser Kuo. "A lot of interesting stuff is made here."

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Kaiser Kuo is also a speakers at the China Speakers Bureau, not only as a rock star but even more as a gifted speaker on China's internet. When you need him at your event, do let us know.

Lower the headcount, Chinese say - Tom Doctoroff

Tom Doctoroff

Comparing how China and Japan are facing the financial crisis, offers huge differences, writes JWT China CEO Tom Doctoroff in his latest contribution for The Huffington Post. His company faces cuts in costs, and his Chinese staff preferred the dismissal of unproductive people.

At JWT, we have had to "derisk" our budgets, not only on the mainland but in Hong Kong and Taiwan as well. The Chinese have accepted staff cuts with no fuss, no muss. As long as the selection of "nonproductive" employees is performance-based, we avoid morale hits. (I asked a few employees whether we should fire a few people or lower salary to save jobs. The answer was unanimous: reduce headcount, please.)

The reaction in Japans was so much different. Tom Doctoroff compares both.

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Tom Doctoroff is also a speakers at the China Speakers Bureau. When you need him as a speaker, do get in touch. He will be in San Francisco in the third week of April. If you need him around that time in California, do get in touch.

"Das Capital" to explain the financial crisis - Zhang Jun

Zhang Jun

"Das Capital", the 19th century masterpiece by Karl Marx, can still help us to understand the current financial crisis, says theater makers in Shanghai. They are making a musical about the thorough book and Fudan professor Zhang Jun in helping them in sticking to the original meaning of the centerpiece of Marxism, he tells AFP.

He said his role is to ensure Marx's ideas are accurately represented in the stage spectacular."
I've given an introductory briefing to the crew. They are still working on the script," Zhang added."
The director, He Nian, will incorporate modern elements in the show to make it easily connect to people's lives and feelings."

Image via Wikipedia

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Professor Zhang Jun is a speaker at the China Speakers Bureau. When you need his insights on China's economy and the financial crisis, do get in touch.

Monday, March 23, 2009

March Newsletter of China Speakers Bureau

Roy Graff

The March 2009 newsletter of the China Speakers Bureau has hit the internet. If you are interested in having a copy, you can click here. One of our bigger projects: the Global China Chat on tourism on April 2 with Roy Graff.
At our website you can also register for upcoming newsletters.

One happy massage please

Image via Wikipedia

First, I'm totally innocent of course, but this weekend I got flooded with tweet (those are messagese from the twitter service) offering me loads of escort services from women in Shanghai. Meanwhile, I must have names, pictures and phone numbers of a busload of them, so very soon - when I can afford it - we can hire a bus and visit Suzhou or other nice places.
It took some time analyzing why I actually got those tweets, and since there was also an occasional "American man" looking for female attention between those tweets, I could trace back the source to the famous Craiglist, the free ad service that is crushing revenue of newspapers worldwide. They have found a way to distribute their free ads also over twitter. I'm using the service twitterfall to monitor all tweets on "Shanghai", so that I can monitor any tweet on Shanghai. This for the geeks among us.
Then I have been - in a good Shanghainese fashion - been comparing prices and most of the women offered a similar price list:

Romantic massage /2Hr:300RMB
Happy massage /2 Hr:500RMB
Top oil massage/2 Hr :800RMB

This reminded me very much of a soup I have been eating regularly at the backstreet of East China Normal University (ECNU) and that was called "Five happinesses of the seven bridges". If could also have been the seven happinesses over the five bridges. But you get the idea. There was no clue to determine what you would actually get.
Now, I hope to find some experts among my readers who can help me out: what do you actually get for the money?

Friday, March 20, 2009

Is the US dollar killing China? - Victor Shih

Image via Wikipedia

Now US president Obama has started the printing presses to flood the world with new US-dollars, existing fears in China that their economy has to suffer from the US problems re-emerge, says financial and political expert Victor Shih in Forbes. A popular book in China "The Currency Wars", even suggests an evil conspiracy to bring down the country.
Forbes:

The believers are not just fire-breathing ideologues. "Many technocrats believe in this argument that the U.S. is trying to screw over China by cheapening the dollar," says Victor Shih, a political economist and China specialist at Northwestern University. Shih learned of the influential reach of "Currency Wars" when he visited last summer with bureaucrats from the People's Bank of China.
"Many PBOC officials bought into the arguments of this book and I think they've been writing a lot of reports to Wen Jiabao saying we're holding a lot of dollars and we're exposed to this risk," Shih says. "And essentially that's true."

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Victor Shih is a speaker at the China Speakers Bureau. When you are interested in having him, sharing his insights, do get in touch.

A bad economy can help startups - William Bao Bean

William Bao Bean

China's economy might have some problems, when you look carefully, that might offer you great possibilities, says VC William Bao Bean of the Softbank China & India Holdings and a director at language-learning startup iTalki at PC World.

Based in Shanghai, iTalki has users living in 200 countries who take language lessons and do language exchanges with other users in more than 100 languages. Recently, the company started to generate revenue by allowing users to sell language lessons online, collecting a commission from each transaction.
"The good thing about this market is that it is a really bad economy and people are looking for ways to work. We've had 1,100 teachers sign up on our platform in the first month," Bean said.

Operating from China, gives the company a great cost-advantage, adds William Bao Bean.

"We have a very low cost base to begin with and then we've managed to further lower it. We think we're one-tenth to one-twentieth their running costs," he said.

Commercial William Bao Bean is also a well-known speaker at conferences. When you need him at your meeting, get in touch with the China Speakers Bureau.

Thursday, March 19, 2009

Chinese will not copy US consumerism - Paul French

A shopping mall in Shanghai by Fantake via Flickr

Analysts and economists are carefully following how the Chinese consumers are behaving during the financial crisis, but it is certain that they will not behave like American consumers, says Paul French, director of Access Asia to USA Today.

"We can't get them to replicate Americans," agrees Paul French, the British marketing director of research firm Access Asia. "Americans are just so good at consumerism, like obesity and greenhouse gas emissions. Although the rest of us try, it is very hard to compete."

By saving up to 24 percent of their household income, Chinese limit their spending power in a similar way European governments do it by taxing their citizens, says French.

The Chinese are "self-taxing," he says. "But it's not as effective as having a welfare state. Theirs is not a bottomless pot." Even frugal Chinese households can be wiped out if a family member is diagnosed with a long-lasting illness such as diabetes.
The stimulus sets aside money for expanding health care and old-age assistance, but French notes that "you can't build a national health care service overnight."

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Paul French is not only a candid observer of Chinese consumers, he is also connected to the China Speakers Bureau. When you need him at your meeting, let us know.

Reasons to be cheerful - Access Asia

Paul French

In these confusing times, where figures point north and south at the same time, we were pleasantly surprised by the weekly newsletter of research firm Access Asia, who saw at least at the points improvements of the Chinese economy. While exports are still going down, Access Asia sees light at the tunnel.
First, property sales seem to move upwards:

Shanghai and Beijing have been OK in the last fortnight, but the real action is in tier-2 and -3, where growth has been very strong month on month. We see this trend continuing thanks to falling prices, availability and the government’s call on people to buy – make no mistake, there is still significant pent up demand out there.

Second, orders from abroad are picking up:

Conversations with factory owners across the YRD, and the Beijing-Tianjin Corridor, over the last couple of weeks, show that orders are coming back – notably in textiles and clothing. Factories have reopened, rehired and (in plenty of cases) are back on overtime (or increased piece rate) to get rush jobs done.

Third, retail remains strong, although not for everybody:

There is, as we predicted, a certain amount of retail Darwinism going on, and the oversupply of retail space in places like (particularly) Beijingis ludicrous. But, overall sales are powering on and the consumer still spending (and spending cash not credit largely).

More at the Access Asia newsletter.
Commercial Paul French of Access Asia is one of the speakers at the China Speakers Bureau. When you are interested in having him at your conference, do let us know.

Wednesday, March 18, 2009

China's vibrant internet - Kaiser Kuo

Kaiser Kuo

Kaiser Kuo, shortly after speaking at the SXSW in Austin, Texas, explains for the outside world why China's internet is such a vibrant and fast changing feature.

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Kaiser Kuo is also a speaker at the China Speakers Bureau. If you need him at your conference, do get in touch.

Tuesday, March 17, 2009

Problem of mobile spam, it works - Shaun Rein

Shaun Rein

The central government is ordering larger mobile communication providers like China Mobile to do something against the rampant spam messages mobile phone users in China get. Main problem, says consumer analyst Shaun Rein, it works. In IDG News:

China had over 640 million mobile subscribers at the end of 2008, according to the MIIT.
Mobile advertising in China's huge market has excited investors, but the mass spamming most effective for advertisers has angered mobile users, said Shaun Rein, director of market intelligence firm China Market Research Group."
SMS spam advertising has been really big in China, because the fact of the matter is it works," Rein said.
SMS spam, down last year, has risen again as companies desperate for cash turn to selling mobile phone numbers, Rein said.

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Shaun Rein is a speaker at the China Speakers Bureau. When you are interested in having him as a speaker, do get in touch.

Most sought speakers - March 2009

Arthur Kroeber

We entered the second half of March again, reason enough to look at trends among the speakers at the China Speakers Bureau. Compared to our top-10 in February, we can see one clear trend: especially in the high end. Not a surprising development in these economically challenging times.
That is partly because compared to the last months of 2008, our trusted voices have also become a bit more outspoken on what they expect for 2009. As always: there is no simple message. The economic picture China is offering at this stage varies very much from industry to industry, from region to region. Economic indicators keep on pointing in different directions. Exports continue to be down, although that is financially compensated by also dropping imports. Car sales over February goes up, although recovery of the real estate sector still seems to be far away.
Arthur Kroeber, after our eternal no.1 Shaun Rein, has moved up most.
Let's then turn to the top-10 of most sought speakers over March 2009:

Monday, March 16, 2009

How to become an entrepreneur in Shanghai - Maria Korolov

Maria Trombly

Larger numbers of entrepreneurs are heading for Shanghai as their own economies go bad. Veteran entrepreneur Maria Korolov gives in Shanghai Expat the newcomers a few tips on how to survive in this very competitive city.

But, before you hire a team of lawyers and incorporate as a JV – or a WFOE – or as a rep office of an off-shore entity, before you start hiring staff and finding customers, do yourself a favor and get to know the entrepreneurs who are already here.

She is advising twitter as one of the new much needed tools for entrepreneurs:

Last week, Paul Wood – who's starting an iPhone software development company – tweeted that he was interested in finding some Samuel Adams beer. Several people, including me, responded about a new bar – Kai Ba – known for its wide selection. Someone else suggested Munchies for snacks and a tweetup was born. The next day, a couple of dozen of us crammed into Munchies for their burgers, Cincinnati chili and quesadillas – excellent, by the way -- and to chat. Across the table from me, Paul Wood met Sera Hill, another entrepreneur who was starting an iPhone development company in Shanghai.

Of course, she lists some of the more active accounts.

Maria Korolov will host on April 2 our Global China Chats on tourism.

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Maria Korolov is also a speaker of the China Speakers Bureau. In a driven and convincing still, she talks you through the trenches of the China business. Do get in touch if you need her at your conference.

Sunday, March 15, 2009

Update on Global China Chat on tourism

Image via Wikipedia

On April 2 the China Speakers Bureau will host two Global China Chats with tourism guru Roy Graff, focusing on different time zones: one for the Asian-European zones and one for the European-American zones.

Over the weekend we have talked to the good people of CoverItLive.com, who are providing the really very cool technology for those chats, who are being used by many media organizations worldwide. Unfortunately, the technology has one unexpected shortcoming: the interface does not adjust according to the time zones. Since most chats are being done inside one time zones or in North-America, where people are more used to deal with different time zones, that is mostly not a problem.

Participants in Asia and Europe are much less used to time zones in their daily lifes. So, it is important to note that both chats indicate a time according to CET or Central European Time. When you are suffering under the regime of GMT, living in Beijing or the US/Canada, you have to do some accounting yourself. We have made list with the different times for different zones here, but noted in our exchanges that most people cheerfully assumed the interface indicated the time in their zone. We have updated our entries and keep our fingers crossed for April 2. Hope to see you there.

Thursday, March 12, 2009

Spil Games: winner in casual games - Marc van der Chijs

Marc van der Chijs by Fons1 via Flickr

Spil Games, the casual game producer, has become the largest in the world, passing other players like Yahoo Games and MSN Games, Shanghai-based entrepeneur Marc van der Chijs announced on his weblog.

The Dutch entrepreneur Van der Chijs is CEO of the Spil Group Asia and has earlier co-founded the successful Chinese video host firm Tudou.

While most of the companies growth, in terms of traffic and revenue, comes from European countries and the US, much of the development of the games is being done in China.

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Marc van der Chijs is not only a successful entrepeneur in China, he is also a speaker at the China Speakers Bureau. When you are interested in having him as a speaker, do get in touch.

Jack Ma at the Asia Society

Image via Wikipedia

This evening, probably a bit too late for those in Asia, the Asia Society will broadcast a speech by Alibaba's Jack Ma at 7:30 EST. If you are awake, interested and technology will help, you should be able to watch it here.

Global China Chat on tourism

Roy Graff

Is China going to bail out a world in crisis? This question is asked in many variations and the tourism industry is one of them. Are the Chinese tourists going to replace the tourists from other parts of the world, or will they stay at home to support their own economy? What are the possibilities of the tourism industry in China? Are the hotels remaining empty or is this the time for foreign companies to enter the China market?

On April 2, 2009 the China Speakers Bureau will host a second Global China chat, this time with China tourism guru Roy Graff of China Contact. This time we will have two sessions, to facilitate different time zones, one for Asia/Europe, the other for the Americas and Europe. The chat will be hosted by Maria Korolov.

Roy Graff's first observations can be found here.

Important update: please note that the time in the interface is standard given in CET or Central European Time and does NOT adjust automatically to your time zone. If you are joining from a different time zone, you have to follow the lists below for the timing. We apologize for the inconvenience.

The timing is as follows.

Global China Chat I for Asia/Europe

April 2

9 AM London

11 AM Brussels

5 PM Singapore (corrected)

5 PM Beijing Time

6 PM Tokyo

Global China Chat II for the Americas/Europe

April 2

London 3 PM

Brussels 5 PM

New York 11 AM

San Francisco 8 AM

Do you have questions to ask? Let us know in advance.

Are you interested in co-hosting this Global China Chat? Nothing is easier. Do get in touch to get the codes for announcements and the chat itself by sending us an email.

Tuesday, March 10, 2009

Blogging less, tweeting more

On the move by Fons1 via Flickr

Blogging activity on the China Herald has decreased quite a lot. Apart from being extremely busy with things-that-cannot be blogged, the weblog as a publishing platform is less important. Mostly, you will see repost from the China Speakers Bureau and otherwise, much of the previous blogging conversations have moved to twitter.

Picking up interesting stories at other media, weblogs or otherwise is so much easier to do at twitter, especially now I have turned to some really useful interfaces that manage the tweeting process much better.

So, yes, the number of blogs is going down and for the time being, I expect that to remain like that. At twitter you can find me at @fonstuinstra.

One-child policy supports Barbie - Shaun Rein

Image via Wikipedia

The once popular Mattel toy Barbie might be facing both a financial and cultural crisis back in its home market, Shaun Rein comments on the multi-million six story venture Mattel opened in Shanghai for its doll. In Forbes:

Not only is Barbie moving into a new region where girls don't really know who she is, but Mattel is expanding its core market to include not only little girls but also club-age young women. Rather than rely wholly on children or mothers who grew up playing with the dolls, Mattel is also targeting twenty-somethings by offering a line of clothing by Patricia Fields, theSex and the City designer.

The daring strategy is building on China's one-child policy, tels Shaun Rein CBS News.

Watch CBS Videos Online

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Shaun Rein is a speaker at the China Speakers Bureau. When you are interested in having him at your meeting, conference or board meeting, do get in touch.

Monday, March 09, 2009

No bail-out from China - Victor Shih

Hu Jintao via Wikipedia

If the world is waiting for China for a bail-out of the global financial crisis, it might be waiting in vain, assistant professor Victor Shih reads in remarks by president Hu Jintao to NPC-delegations from Guangdong. He translates on his weblog:

"Now many countries are saying that China is good and hope that China will emerge (to help them), but honestly we are still a developing country. Don't over estimate the fact that we have almost 2 trillion dollar in our foreign exchange reserve. If you take that amount and divide it by 1.3 billion people, how much per head is that? Therefore, we truly need to conduct our own affairs well."

Victor Shih concludes:

Chinese commitment to help bail out other countries is nearly zero. Perhaps a few billion will be thrown at the IMF or World Bank, but beyond that, there will be little. There were some currency swaps recently between China, Japan, South Korea, and Hong Kong, but I view them as largely symbolic gestures than genuine help. Also, part of conducting China's affair well is to continue to expand China's export markets.

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Victor Shih is a speaker at the China Speakers Bureau. When you want him to share his insights, do get in touch.