China Economy Forum

[onebyone]

Alibaba Sales Beat Estimates After Making Mobile, Rural Inroads

January 28, 2016 — 6:58 PM ICT
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Alibaba Group Holding Ltd.’s third-quarter revenue beat analysts’ estimates after an online-sales extravaganza and expansion into rural China helped the nation’s biggest e-commerce operator defy a slowing economy.

Developing...

 

[onebyone]

Alibaba Beats Estimates as Ma's Push Into Rural China Pays Off

Lulu Yilun Chen luluyilun
January 28, 2016 — 6:59 PM ICTUpdated on January 28, 2016 — 8:56 PM ICT
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Billionaire Chairman Jack Ma is trying to tap the spending power of the countryside with the Internet expected to blanket all of rural China by 2020, according to the China Academy for Rural Development at Zhejiang University.



Gross merchandise value surges 23% driven by mobile spending

• Mobile monetization rates increased to 2.88% in quarter

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Alibaba Group Holding Ltd. beat analysts’ estimates for revenue and profit as Chairman Jack Ma’s push into China’s countryside helped defy a slowing economy.

Sales surged 32 percent to 34.5 billion yuan ($5.2 billion) in the three months ended December, the company said Thursday, compared with the 33.2 billion-yuan average of estimates compiled by Bloomberg. Net income more than doubled to 12.5 billion yuan. Shares rose more than 5 percent in premarket trading in the U.S.

Billionaire Ma is tapping the spending power of rural areas, where more than half the population live, by providing purchasing and delivery services as he captures a greater slice of the money spent on mobile shopping and advertising. Along with a resilient middle class, that’s helping Alibaba capitalize on China’s shift toward consumption from smokestack industries even as the economy grows at the slowest pace in 25 years.


“Alibaba continues to grow as urbanization and an ever more ambitious middle class continues to drive up China’s cost of living and consumption,” said New York-based Brian Buchwald, chief executive officer of Bomoda, a consumer intelligence company with a focus on the Chinese market. “At the heart of it, is continued investment in mobile and simplifying payments for virtual and actual purchases.”

Mobile Monetization
Alibaba has pulled out the stops to get its e-commerce platforms in front of villagers, setting up free Internet-equipped computers and working with local officials to train potential buyers and sellers. It now has a presence in 12,000 villages across the country.

“Our strategy is to sell goods from urban areas to villages, as well as help farmers sell farmer products to people living in the cities,” Chief Executive Officer Daniel Zhang told investors on a conference call.

Longer-term, Ma is investing in video content, media, on-demand services and cloud computing to generate new sources of income as he takes the e-commerce company global. Shares of Alibaba closed Wednesday at $69.54 in New York. The stock has declined 14 percent this year after a 22 percent slump in 2015.


Gross merchandise volume in its Chinese retail marketplaces rose 23 percent to 964 billion yuan in the quarter, while mobile GMV almost doubled to 651 billion yuan. The rate at which the online retailer monetizes, or earns revenue from transactions via smartphones and tablets, rose to 2.88 percent in the quarter from just 1.96 percent previously.

Chief Financial Officer Maggie Wu said she expects Alibaba’s revenue to grow faster than total transactions “for the foreseeable future,” suggesting that the company’s monetization ability will continue to improve.

Mobile is driving China Gross Merchandise Value
Singling Out
The quarter included November’s annual “Singles’ Day” promotion which generated a record 91.2 billion yuan of sales, 60 percent more than a year earlier.

“Alibaba is on track to gain more shoppers in rural areas and smaller cities in China,” said Li Yujie, an analyst at RHB Research Institute Sdn in Hong Kong. Alibaba ended 2015 with 407 million active buyers, up 5 percent from the end of September.

Ma has set a goal of getting 50 percent of the company’s revenue from beyond China.

Investors have highlighted escalating scrutiny about the sale of counterfeits on its websites, such as Taobao Marketplace, as a key risk for 2016. Though the company has said it’s committed to combating fakes, cleaning up its image next year is crucial to Alibaba’s goal of winning the trust of merchants and shoppers overseas.

Internet Services
Cloud computing revenue rose 126 percent to 819 million yuan, Alibaba said. Its AliCloud unit is staking $1 billion on the belief that demand for processing and storage from governments and companies will boost growth during the next decade as its tries to compete with Amazon.com Inc. in computing services.

Alibaba is also expanding in the online-to-offline services market. Tencent Holdings Ltd., Alibaba and Baidu Inc. are competing for supremacy in a local-services industry primed for growth as more people turn to their smartphones or the Web to order food, schedule beauty treatments or hire domestic helpers. Users of those services could rise 29 percent to 400 million by next year, with sales expected to reach 7.28 trillion yuan by 2017.

Tsai confirmed that Alibaba is selling its stake in Meituan-Dianping, the Internet platform for everything from group-buying to food delivery backed by Tencent. It will instead focus on Koubei, a local services venture with its financial affiliate now gaining momentum. The venture did 15.8 billion yuan of business through the Alipay payments system in the quarter, with an average of more than 5 million daily transactions in December.

 

[cirr]

Chinese Semiconductor Industry's Latest Move: Sage Micro's Low-key Acquisition of Initio

Press release [Thursday 28 January 2016]

Sage Microeletronique Corp acquired Initio Corporation on the last day of 2015. Since the second half of 2015, Chinese companies were frequently making acquisitions to integrate upstream and downstream sectors of the semiconductor industry. While the shockwaves of Tsinghua Unigroup's recent acquisitions were still rippling through the semiconductor industry, China's only solid-state storage controller chip company, Sage Microelectronique Corp (hereinafter referred as Sage Micro), signed an agreement to acquire Initio Corporation (hereinafter referred to as Initio).

Initio is a turnkey storage and retrieval solution provider and also has an extensive line of bridge controller IC products. Sage Micro has also acquired Initio's entire bridge controller IC product line through its US-based wholly-owned subsidiary. The acquisition also includes Initio's related IP portfolio accumulated over two decades as well as its trademark and brand. The price of the acquisition has not been disclosed.

Initio, a globally renowned supplier of bridge controller ICs, was founded in 1994. It specializes in high-speed transmission interface control technologies, including SATA and USB, as well as other high-speed interface bridge controller ICs. Its customers include first-tier global optical drive and hard drive suppliers such as WD and Seagate. According to information from reliable sources, Sage Micro's CEO Dr. Jerome Luo & its CTO Chris Tsu worked in Initio's R&D Department from 2008-2011. In addition, Larry Ko, who was Initio's founder and vice president of engineering, also joined Sage Micro one year ago. The founders history of working together will assure that the integration of the two companies will progress smoothly and quickly.

After acquiring Initio, Sage Micro will integrate its many bridge controller IC product lines. Through this acquisition, Sage Micro has not only obtained SATA and USB physical layer technologies, but also related patents and certifications. Sage Micro has become China's only vendor that possesses a full line of storage controller IC technologies and products. Going forward, Sage Micro plans on evolving from a solid-state storage IC supplier and memory module vendor, into a storage solutions supplier with a wide range of high-speed transmission interface technologies.

Sage Micro has the most complete propriety solid-state hard drive control IC IP portfolio in China, and has keenly implemented strategies for expanding into the enterprise storage space as well as the data encryption space by adding encryption technologies to its storage controller ICs. Just four years after its founding, Sage Micro gained much interest from investors in China and started trading (#834203) on China's New Third Board (OTC market).
In today's semiconductor industry, Chinese tech companies continue to invest heavily in mergers and acquisitions to expand production capacity. China's state-owned companies have taken aggressive and high-profile approaches to acquire intellectual property with Tsinghua Unigroup recent acquisitions and joint ventures being particular noteworthy. Sage Micro's strategy has been to proceed slowly and steadily, using its technological capabilities as a basis for integrating other teams, placing intellectual property and IC technologies at the core of its strategy. In addition to being particularly low key, Sage Micro's acquisition focuses on Initio's product line as well as its trademark and brand, effectively avoiding the complexities of mergers between companies from different countries and regions, and yet still achieving the desired results. This shows that the people handling the acquisition are not only extremely experienced, but also extremely sophisticated, embodying the low-key yet highly practical and effective style of traditional Chinese business people from Zhejiang. This acquisition has also shown to the world how mature China's high-tech industry has become in terms of learning, strategic thinking, and style. From this point of view, Taiwan's related industries need to adjust their attitudes and ways of looking at China's tech industry.

From the perspective of the storage industry, Sage Micro is implementing a global strategy for development of China's Big Data industry, which differs from Taiwan-based IC design houses' past strategy, which only focused on the PC industry when designing storage products. Taiwan's controller vendors, such as SMI and Phison, are facing difficulties due to the contraction of the PC industry as well as traditional storage needs being replaced by cloud-based storage solutions. Therefore, these companies are in dire need of transformation in terms of their product lines. In contrast to the strategies of Taiwan's companies, Sage Micro has integrated strategies of Big Data storage vendors in the United States and further strengthened information security features to meet requirements of the local market, making it an unexpected rising star in the industry. The Chinese government is fully supporting Tsinghua Unigroup's aggressive acquisitions and encouraging the techno political campaign of "innovation by the whole nation and entrepreneurship by all people." Rising stars in the tech industry such as Sage Micro are aggressively looking for acquisition target. The global storage industry is heating up but these developments have also deepened the crisis faced by Taiwan's controller vendors and have made it even more difficult for them to survive.

In the post-PC era, with Big Data storage trends on the horizon, it can be anticipated that Sage Micro will continue to expand its products and its reach through bold and aggressive strategies. This will have an extremely strong impact on Taiwan's storage IC vendors. We hope that Taiwan's storage IC vendors can quickly rise up to this challenge and devise effective strategies for overcoming the obstacles that lie ahead.

Sage Micro's BlackDisk 10TB SSD with a thickness of only 9.5mm

http://www.digitimes.com/supply_chain_window/story.asp?datepublish=2016/01/27&pages=PR&seq=203

SMIC to Benefit from $3 Billion Investment

Peter Clarke

1/26/2016 11:46 AM EST

LONDON—The Shanghai Integrated Circuit Investment Fund (SICIF) has announced a plan to invest 20 billion yuan (about $3 billion) in foundry Semiconductor Manufacturing International Corp. (SMIC) and two other Shanghai-based chip manufacturers, according to a Moody's Investors Service report.



Although the funds are to be split between three manufacturers Moody's expects SMIC to get at least one quarter or about $750 million.

Moody's sees the announcement as positive for SMIC which is China's leading chip foundry but one that is struggling to get close enough to the leading-edge to trouble market leaders such as TSMC, Samsung and Globalfoundries.

In 2015 SMIC invested about 10 billion yuan (about $1.5 billion) and was the beneficiary of a $400 million investment by the nationally organized China Integrated Circuit Industry Investment Fund.

The CICIIF is a national fund established in September 2014 to support the growth of the IC industry in China. SICIF was created in 2015 as a 50 billion yuan (about $7.5 billion) "small fund" to support IC design, manufacturing, materials and equipment development as part of China's national "big fund" plan.

The funding will be welcome and could help SMIC's migration to offering 28nm, which is expected to be a workhorse node at a time when TSMC is thought to be about to construct a 300mm wafer fab in China.

http://www.eetimes.com/document.asp?doc_id=1328783

 

[cirr]

China Blows Past the U.S. in Wind Power

Scientific American

21 hours ago

China solidified its standing as the world’s wind energy behemoth in 2015, adding almost as much wind power capacity in one year as the total installed capacity of the three largest U.S. wind-producing states: Texas, Iowa and California. New data from Bloomberg New Energy Finance show China installed just under 29 gigawatts of new wind energy capacity in 2015, surpassing its previous record of roughly 21 GW set in 2014. The country also accounted for more than 46 percent of all wind power installed globally for the year, eclipsing the next largest market, the United States, which added 8.6 GW (ClimateWire, Jan. 28). Amy Grace, head of wind insight at BNEF, said the Chinese growth figure was the ...

further reading

https://www.yahoo.com/

China's new wind power capacity rises 60%, hits record high

BEIJING - China's newly installed wind power capacity reached a record high in 2015 amid increasing efforts from the government to boost clean energy.

The new wind power capacity jumped to 32.97 gigawatts last year, more than 60 percent higher than 2014, the National Energy Administration (NEA) said on Tuesday.

Wind power generated 186.3 terawatt hour of electricity in 2015, or 3.3 percent of the country's total electric energy production, data showed.

Promoting non-fossil energy including wind power, China is in the middle of an energy revolution to power its economy in a cleaner and sustainable manner. The government aims to lift the proportion of non-fossil fuels in energy consumption to 20 percent by 2030 from present around 11 percent.

China's energy mix is currently dominated by coal.

However, the NEA warned of the suspension of wind farms in Inner Mongolia, Xinjiang and Jilin. The phenomenon occurs in the early stage of wind power capacity construction due to the mismatching of new installation and local power grid.

http://www.chinadaily.com.cn/busines...t_23368847.htm

 

[JSCh]

China National Chemical Corp acquires Syngenta AG
By Zhong Nan (chinadaily.com.cn) Updated: 2016-02-03 15:44

A Chinese national flag and a company flag fly in front the logo of China National Chemical Corporation at the company's headquarters in Beijing, Mar 24, 2015. [Photo/IC]​

State-owned China National Chemical Corp offered Swiss agrochemical and seed producer Syngenta AG more than $43 billion to acquire its entire stake, making it the biggest acquisition deal by a Chinese company.

Two companies have reached the acquisition deal in which the board of directors of Syngenta unanimously recommended ChemChina's offer to purchase 100 percent of Syngenta's equity. The offer price is $465 per share in cash.

Syngenta - a major player in agrochemicals and seeds - is proficient in delivering on the sustainability and enhancement of food security in an increasingly interconnected global production chain through its commercial offers.

ChemChina will continue to support Syngenta's integrity in its operations, management and employees, including keeping its headquarters in Basel, Switzerland.‎ ChemChina will further maintain, promote and enhance Syngenta’s exemplary reputation by continuing to invest in its leading agricultural solutions and innovation capabilities.

Syngenta has employed more than 2,000 people in China since it started business in the country in 1998. It has invested $360 million in China since 2000 to compete with established rivals from the United States and Germany.

 

[cirr]

Dongfeng Renault Opens First Plant In China, Will Build The Kadjar

Posted by Cristian Gnaticov



Following the joint venture formed in late 2013, DRAC (Dongfeng Renault Automotive Company) has opened its first plant in China.

The facility, which was built in two years using a multi cultural team from the French brand's partners at Dongfeng and Nissan, is located in Wihan, in Hubei Province, and achieved ISO 9001 certification for quality in November 2015.

Present at the opening event, along with Dongfeng's Chairman, Zhu Yanfeng, Groupe Renault's Chief Executive Officer and Chairman, Carlos Ghosn, said: "This is a milestone in our long-term partnership with Dongfeng Group, as well as for Renault’s growth. China is a core part of Renault’s strategic plan."

DRAC's new facility includes a vehicle assembly plant, a powertrain plant and a Research & Development center, to adapt products to customers' requirements. It will have an initial production capacity of 150,000 cars per year, but it has the potential to double.

The first vehicle to be manufactured at the Wihan facility is the Renault Kadjar, which is slightly different from its European counterpart, equipped with 4Control, independent rear suspension and a panoramic sunroof.

The SUV category is the fastest growing segment on the Chinese market and accounts for 30 percent of sales, so the Kadjar will become an important player for the joint venture, locally. The model will go on sale in China in March, 2016.

http://www.carscoops.com/2016/02/dongfeng-renault-opens-first-plant-in.html

 

[Jlaw]

China's money outflow not investment withdrawal: authority
Source:Xinhua Published: 2016-2-4 23:42:08

China's capital outflow last year should not be equated with withdrawal of foreign investment, forex administrant said on Thursday.

The outflow occurred as domestic banks and enterprises vigorously increased holdings of overseas assets and repaid debts, the State Administration of Foreign Exchange (SAFE) said when answering questions from reporters.

"There is an essential difference with the so-called withdrawal of foreign capital," the SAFE said.

In the first three quarters of last year, China's overseas assets increased by 272.7 billion US dollars, and deposits in foreign banks and lending to foreign companies rose by 96.9 billion US dollars, data showed.

China's overseas net financial assets ranks second in the world, which inevitably prompts capital outflow as long as China maintains its current account surplus, the SAFE said.

By the end of 2015, China's foreign exchange reserves shrank to 3.3 trillion US dollars, but is still the world's largest.

China's huge reserve assets and stable external debt structure can provide strong resistance to impacts from capital flows, the SAFE said. CHINA'S BALANCE OF INTERNATIONAL PAYMENTS

China saw a capital account deficit in the fourth quarter of 2015 after a surplus registered in the previous quarter.

The deficit under the capital and financial account stood at 84.3 billion US dollars during the Sept.-Dec. period, reversing the surplus of 11.4 billion US dollars three months previous, according to preliminary statistics released by the SAFE.

In the meantime, reserve assets, most of which are foreign exchange, decreased by 115 billion US dollars, narrowing from a drop of 160 billion US dollars in the third quarter.

China started to post deficits on its capital and financial account in the second quarter of 2014 due to rapid increases in overseas investment and speculation on depreciation of the yuan.

China reported a current account surplus of 84.3 billion US dollars in the fourth quarter, up from 60.3 billion US dollars posted in the third quarter.

For the whole of 2015, China saw a current account surplus at 293 billion US dollars, a capital and financial account deficit at 161 billion US dollars and a reserve assets drop at 343 billion US dollars.

Posted in: Economy

 

[Jlaw]

U.S. dollar, not China, is to blame for economic slowdown: Forbes


Source: Xinhua 2016-02-09 20:06:50

NEW YORK, Feb. 9 (Xinhua) -- While it is easy to blame the United States' slowing economy on foreigners, a recent article published by The Forbes has pointed out that rise of the U.S. dollar is the root cause.


The U.S. economy sharply slowed in the fourth quarter of 2015 with a mere 0.7-percent annual growth rate, a significant drop compared to earlier in the year.

With exports falling, it is easy to attribute to falling demands from overseas markets such as China and Europe, but the author believed otherwise.

"Looking a bit deeper, it appears more likely that the problem lies in the strengthening U.S. dollar; America's successful emergence from the Great Recession is to blame," said the article.

According to Torsten Slok, chief international economist for Deutsche Bank, U.S. manufacturing has been slowly decreasing since the latter half of 2014, while the manufacturing indices of both Europe and Japan have remained expanding.

The expert believed that strong dollar lies behind the sluggish economic performance.

"Whatever the cause for the U.S. slippage, it is not hitting Europe and Japan," the article deduced, adding that "when the dollar began its broad-based strengthening in July 2014, the expansion in U.S. manufacturing stopped."

"The rise in the value of the dollar against other securities makes U.S. produced goods appear relatively expensive," and naturally, demand for them dropped.

The article pointed out that if a decreasing Chinese demand was responsible for manufacturing decline, similar patterns should have appeared in Europe and Japan, as China's demand for good in these regions is usually heavy.

"Instead, the plausible reason is that U.S. goods got relatively too expensive," said the article.

As to why the dollar grew so strong, the article listed increasing purchase of U.S. goods or investments, robust recovery from the Great Recession and especially, the Federal Reserve's tightened monetary policy with projected rise in U.S. interest rates, as the causes.

 

[cirr]

China new energy vehicle output swells in January

Feb 16,2016

BEIJING, Feb.16 (Xinhua) -- China's production of new energy vehicles surged by 144 percent year on year in January to 16,100 units, the Ministry of Industry and Information Technology said on Tuesday.

The output of pure electric passenger vehicles tripled from the same period last year, reaching 7,952 units in January, the ministry said in a statement.

Plug-in hybrid passenger vehicles reached at 2,422 units, with an increase of 80 percent year on year.

Plug-in hybrid commercial vehicles saw a mild drop in output by 4 percent, standing at 834 units.

Official data showed that 97 percent of new energy vehicles produced in January would benefit from favorable taxation policies.

China has rolled out measures to promote new energy vehicles in a bid to save energy and combat pollution, including tax exemptions, subsidies for car purchases and a requirement for government departments to buy more new energy cars.

China new energy vehicle output swells in January | Shanghai Daily

 

[JSCh]

Business | Thu Feb 18, 2016 3:51am EST
China's HNA Group to buy Ingram Micro for $6 billion

Chinese aviation and shipping conglomerate HNA Group [HNAIRC.UL] is buying electronics distributor Ingram Micro Inc (IM.N) for about $6 billion, the latest in a string of overseas deals by Chinese companies.

The offer of $38.90 per share from HNA unit Tianjin Tianhai Investment Co Ltd (600751.SS) represents a 31.2 percent premium to Ingram's closing price on Wednesday.

Shares of Ingram Micro, which distributes products ranging from Apple Inc's (AAPL.O) iPhones to Cisco's (CSCO.O) network equipment, were trading at $36.40 in after-hours trading.

Chinese companies have been aggressively splurging on foreign acquisitions to sidestep slowing domestic growth. Chinese firms spent more than $100 billion on overseas acquisitions in 2015, the most ever.

But some Chinese deals have hit a roadblock in the United States after the U.S. Committee on Foreign Investment in the United States (CFIUS) raised concerns over national security.

Fairchild Semiconductor (FCS.O) said on Tuesday it had rejected an offer from China Resources Microelectronics Ltd [CHRMI.UL] and Hua Capital Management Co Ltd, citing concerns over the U.S. approval process.

Ingram said in a regulatory filing that Tianjin Tianhai will be required to pay the company a fee of $400 million if the deal is terminated following a CFIUS investigation.

"I don't expect it would be a security concern as Ingram Micro is a distributor of the equipment, and the vast majority of the products do not go to high-security customers," Northcoast Research analyst Keith Housum said.

The deal will help HNA Group, the owner of China's Hainan Airlines (600221.SS) and the largest stockholder in Tianjin Tianhai, bolster its logistics arm with Ingram's supply chain network.

It will also give the company a stronger foothold in high-growth emerging markets through Ingram's large international presence.

As part of the deal, Ingram Micro will suspend its quarterly dividend payment and its share repurchase program, it said.

Morgan Stanley was financial adviser to Ingram Micro, while China International Capital Corp Ltd and Bravia Capital were lead financial advisers for HNA Group.

(This version of the story corrects paragraph 4 to say "Chinese firms spent more than $100 billion on overseas acquisitions in 2015, the most ever" instead of "The total value of Chinese outbound acquisitions topped $1 trillion for the first time last year.")

(Reporting by Sai Sachin R in Bengaluru; Editing by Saumyadeb Chakrabarty)

China's HNA Group to buy Ingram Micro for $6 billion| Reuters

 

[Jlaw]

News Analysis: Chinese manufacturing adapts to changing times

Source: Xinhua | 2016-02-17 01:55:01 | Editor: huaxia

(Xinhua File Photo)

BEIJING, Feb. 17 (Xinhua) -- In China's southern manufacturing hub Dongguan, a shoe factory is shutting down and laying off 1,900 employees.

A subsidiary of Stella International Holdings, the factory is one of the most important production and processing bases for brands like Nike, Prada and ECCO.

"With demand shrinking and wages rising, we had no choice but to shut down," said Zhong Weijie, a human resource manager of Stella International Holdings. "The capacity will move to Southeast Asia."

But it is not all doom and gloom.

An hour's drive from Dongguan in Shenzhen, smartphone maker Huawei announced sales revenue of 60.1 billion U.S. dollars in 2015, and predicted 81.8 billion U.S. dollars this year. Huawei is now the world's third biggest smartphone maker after Samsung and Apple, and rapidly expanding.

These two stories are a snapshot of what's happening in Chinese factories: traditional manufactures battle overcapacity, while new industries blossom.

Huawei has achieved its success through continual innovation. Every year, 10 percent of revenue is plowed back into R&D. Almost half of its employees engage in R&D in some way or another.

The shift of manufacturing pattern is seen in China's exports. Processing, labor-intensive and using little technology, is being replaced by general trade, which involves domestic products and technology. General trade now accounts for 58.4 percent exports.

In May 2015, China rolled out the "Made in China 2025" plan to shift away from low-end manufacturing to more value-added production. Local governments have offered tax incentives to high-tech companies and guided private funds into innovative projects.

As tech-intensive production becomes lucrative, traditional manufactures are adapting.

"It's true that fields with overcapacity problems have operational difficulties, but by improving energy efficiency, we also see many opportunities," said Yin Jianan, chairman of Shanxi Blower Machinery Company.

Opportunities also lie in international cooperation. By establishing factories overseas, many Chinese manufacturers have found ways to digest excess capacity with lower labor-costs abroad.

Overseas mergers by Chinese firms increased by 40 percent in 2015, most of which led by private manufacturers buying out foreign businesses tech advantages of valuable brands, according to PricewaterhouseCoopers (PwC).

"We believe the trend will continue," said Liu Yanlai, a partner with PwC, "China-led multinationals are going onto the world stage."

Just as China relied on manufacturing to rise in the past, the sector is still a pillar industry. Chinese manufacturing is not fading, it's just changing.

 

[JSCh]

Australian gov't approves sale of biggest dairy farm to Chinese billionaire
Source: Xinhua | 2016-02-24 09:31:24 | Editor: huaxia

MELBOURNE, Feb. 24 (Xinhua) -- The Australian government has approved the sale of the nation's biggest dairy farming company to Chinese billionaire Lu Xianfeng.

Van Diemen's Land (VDL) - which boasts several dairy farms in Tasmania's north, known for having the world's cleanest air and water - officially changed hands late Tuesday, with the deal getting the all clear from the Australia's Treasurer Scott Morrison.

In line with all foreign asset sales, the 200-million-U.S. dollar deal has been subjected to a review by Australia's Foreign Investment Review Board, which found agreement met its "national interest" criteria.

Following the announcement, Senator Eric Abetz said the decision showed Tasmania was "open for business" and the conditions imposed by Treasurer Morrison would safeguard the industry for years to come.

"This approval will see an additional 95 jobs in Tasmania as well as a significant investment in VDL of more than (72 million U.S dollars)," Senator Abetz said in a statement on Wednesday.

"With Free Trade Agreements with Japan, (South) Korea and China, combined with the government's shipping reform package, Tasmania has the potential to be opened up to new world markets which could dramatically grow the number of jobs in Tasmania."

Originally, VDL had agreed to sell its 13 farms - with a combined area of 19,000-hectares and 18,000 milking cows - to Australian company, Tasfoods, for 180 million U.S. dollars. But the New Plymouth District Council, the group's New Zealand-based owner, went back on the deal after receiving a better offer from Lu's Chinese company, Moon Lake Investments.

Given VDL has never been Australian owned despite operating out of Tasmania since 1825, many politicians have been lobbying to have the asset acquired by a local company.

However, Abetz has labeled some of reasons against the deal as "bizarre" and bordering on "xenophobic".

The finalization of the sale has also been praised by the Tasmanian Farmers and Grazers Association (TFGA).

"Moon Lake Investments' continued investment in the sector will further reinforce the importance of the dairy industry, and agribusiness in general, to the Tasmanian economy," TFGA chief executive Skillern said on Tuesday.

As part of the deal, Moon Lake Investments must comply with Australian taxation law, including disclosing any transactions with non-Australian residents, or face the prospect of hefty fines and potentially divestment of the asset.

 

[JSCh]

First loans and bonds for BRICS Bank expected
By Zheng Yangpeng in Shanghai (chinadaily.com.cn) Updated: 2016-02-25 14:57

A clerk counts yuan bills at a bank in Huaibei, East China's Anhui province. [Photo/IC]​

The BRICS Bank is likely to extend the first batch of loans and offer the first renminbi bond in the second quarter of this year, a vice-president of the bank said on Thursday.

The first loans will be granted to each of the founding members: Brazil, Russia, India, China and South Africa, in their renewable energy sectors, Paulo Nogueira Batista Jr, vice-president of the bank, formally known as the New Development Bank, told a symposium on multilateral development banks.

"The size of the loans will be hundreds of millions, " he told China Daily on the sidelines of the meeting, declining to specify the exact number.

He also said the first renminbi-denominated bond would be issued in the second quarter, without specifying its size. It would be sold in China's onshore bond market as "Panda Bonds".

The loan and issuance of bonds comes less than six months since the bank was formally launched in July.

 

[JSCh]

Chinese firm buys German waste-to-energy company
Source: Xinhua 2016-03-03 12:41:3

BEIJING, March 3 (Xinhua) -- An investment group controlled by the Beijing municipal government has bought Germany's largest waste management company, EEW, for 1.4 billion euros (1.5 billion U.S. dollars).

This is the largest ever Chinese acquisition of a German company, Beijing Enterprises said in a statement on Wednesday.

"By learning about the latest German waste-to-energy technology and management expertise, we will help environmental protection in China and contribute to green development," said Zhou Si, vice chairman of Beijing Enterprises.

EEW is Germany's leading waste-to-energy firm. It operates 18 garbage incinerators in Germany and neighboring countries. In 2015, it turned 4,4 million tons of waste to energy.

Beijing Enterprises has several investment projects in Malaysia, Indonesia, Singapore and Portugal.

 

[JSCh]

China accounts for half of world's PE/VC investment in 2015
Source: Xinhua 2016-03-04 16:21:42

BEIJING, March 4 (Xinhua) -- China's entrepreneurial boom drew nearly half of the investment the world's venture capital and private equity funds made last year, according to a report.

Investment in Chinese companies reached 192.1 billion U.S. dollars in 2015, or 48 percent of the world's total, according to a report released on Thursday by PwC.

This represents a 169-percent rise from a year ago in China, compared with a modest 18-percent increase worldwide.

Chinese companies in tech and consumer-related sectors raised a total of 76.8 billion dollars, six times as much from a year before.

Investors are looking to take advantage of China's start-up boom against the backdrop of a global economic slowdown, the report said.

It also found that initial public offerings (IPOs) on the Chinese stock market are the preferred choice over listing in the United States among investors for exits, as China pressed ahead reforms of its IPO system toward a registration-based model to list more companies in emerging industries.

Investors are also seeking alternative channels to cash out their investments in addition to IPOs. Among options considered by investment funds is China's over-the-counter market, the National Equities Exchange and Quotations, where unlisted companies can transfer their shares.

PwC also added that China dominated the Asian PE/VC market, with fundraising in the past 10 years reaching 430 million dollars.