Briefly…Top Ten Tweets (From Goldilocks, Growth & Economic Crimes, To Oil Spills, Espionage & SMEs)

Related entries: Business Issues, Consumer Market, Corporate News, Economy, Environment, General, News, Risk & Law

The economic debate on growth and inflation continues to rage, and was put nicely in the FT – drawing on an old Standard Chartered report it wondered whether the economy could be served up at just the right temperature, or whether the bears (exemplified by Andy Xie) would be right about inflation risks. For the moment it seems the bears are under control, and Morgan Stanley has revised its 2010 (CPI) inflation and GDP estimates to 2.8% (from 3.2%), and 10% (from 11%) respectively.

China’s continued growth remains an opportunity for international business but, as we have noted in previous posts, many have become frustrated with what is perceived to be a more challenging business environment (“indigenous innovation”, state secrets etc.). While difficulties remain, it should be remembered that China cannot be seen in black and white – and some companies are doing very well. The reality is that structure, sector and location play an important part in commercial success. As the FT notes: “GM’s joint ventures…have found it hard to keep up with demand over the past year. China may well be GM’s most profitable global market”.

The New York Times also looked at GM as a successful case study, highlighting its plan to introduce a new brand (“Baojun” or “treasured horse”) specifically for the China market, targeting the growing demand outside the major cities (we noted a couple of weeks ago that GM’s China sales have overtaken those in the US ). And GM is filling both ends of its China pipe, with the China Economic Review reporting that it is investing US$250m in an R&D centre in Shanghai. Investing, developing R&D, localizing the offer, and looking to the lower-tier cities, are good boxes to be ticking.

Sticking with the automotive strand, and the grey nature of things, it is worth remembering that not all is rosy for everyone. Recent strikes have continued to cause problems at some companies, including Honda suppliers. Reuters reported that “strikes at Atsumitec Co, which supplies Honda Motor Co’s China operations…ended after workers agreed to a 45-percent pay raise to 1,420 yuan ($210) per month”. Risks remain, and wage bills continue to rise. Businesses in China would do well to proactively review wage, as well as wider labour force, issues (which are here to stay).

While big business is already big in China, SMEs have been looking at it with fresh eyes while their traditional markets have been slowing. China Law Blog pointed to some advice from Technomic Asia’s Business Podcast, and made the point that while there is a lot of opportunity, there is “little room for error”. Read Dan’s post and avoid the “lights out” legal errors that others have made.

Legal issues are never far from the service anywhere business is done, and China is no exception. A raft of recent graft cases have been topped by the incomparable conviction of the former deputy head of the Public Security Bureau’s (PSB’s) Economic Crimes department, in relation to US$2m of bribes from founder of Gome (whose trial appeared in a previous update). Of course, corruption is not just on the Chinese side – Avon is just the latest foreign firm to face investigation of business practices in China. A(nother) timely reminder for an audit and some training / re-education?!

Protection of intellectual property is another regular feature of China business discussions and, while the tend is positive, a few industrial espionage cases have hit the headlines, including Motorola vs. Huawei (and former staff), BP vs. former staff, and GM vs. (former staff and Chery). AS China Law Blog has pointed out before, “NDA’s are not enough” (here and here).

Disasters of a different nature have also hit the news, with China’s biggest oil spill closing Dalian port, and causing widespread environmental damage, as well as economic loss. Needless to say, environmental issues are sensitive socially, politically and economically. Another issue for constant corporate review.

At least there is some good news on the energy / environment side – as China has announved a RMB5 trillion investment plan for renewable energy to help it meet carbon emission reduction targets for 2020. Peoples’ Daily reports that “the new plan will greatly ease China’s excessive reliance on coal in 2020 and cut sulfur dioxide emissions by about 7.8 million tons and carbon dioxide emissions by about 1.2 billion tons in a year”.

Once again there has been so much news, it has been a challenge make our picks. While we like to have a number of sources, and to build on some key themes, we also like (and agree with) Janet Carmosky’s take on the China Daily (USA edition). She notes: “To be sure, its editorial policy is under the eye of the state. But it’s also a reliable force for increased transparency and an invaluable window to modern China…” Among the top reasons to read it, is that fact that it is “impossible to miss the official position”. And the official position is always good to know…

And finally (11th out of our allotted 10), given our recent interest in books on China, check out this podcast on some excellent reads (and subscribe for well-informed, weekly discussions on all things China): RT @imagethief: New Sinica podcast with @KaiserKuo, @goldkorn and me…death of the China blog: Slightly misleading title

See the news, and links to sources, below:

1. Goldilocks (being chased by bears) RT @BeyondBrics: China: goldilocks or inflation crisis? (see also: 10% for 2010? RT @chinastakes: China’s Growth Revised down and Policy Growth-Supportive …10.3%YoY in 2Q10…

2. Some are motoring RT @BeyondBrics: Multinationals in China: right city, right sector (see also: CEOs speak out RT @shaunrein: China Is Coming Under Fire WSJ

3. Brand new auto RT @live_china: GM Joint-Venture Introduces New Brand to China – New York Times (blog) (see also: Alternative fuels, materials RT @chinaeconreview: GM begins work on Shanghai auto R&D center

4. Striking some deals RT @westlawchina: Strikes end at two Chinese automotive suppliers #china (see also: Rising costs RT @WSJChina: Hon Hai Broaches Price Boost

5. RT @Chinalyst: SMEs In China: Much Opportunity But Little Room For Error…China Law Blog

6. RT @MalcolmMoore: Xiang Huaizhu… dep head of PSB’s economic crimes dept, gets convicted of taking $2m of bribes from founder of Gome. Errr (see also: Beyond FCPA RT @niubi: Avon Board Faces Suit From Shareholders Over Business Practices in China – Bloomberg

7. RT @MalcolmMoore: RT @randomwire: Motorola sues Huawei and several former employees for stealing wireless trade secrets (see also: RT @chinahearsay: Another China industrial espionage case: BP Sues Six Former Staff for Misusing Confidential…; And: RT @GE_Anderson: Detroit couple arrested for trying to sell GM hybrid technology to Chery.

8. GreenerChina WOW! MUST SEE THESE RT @greenlawchina: Powerful photos of the Dalian #oilspill #China #environment #pollution (see also: …& spill 2 RT @greenlawchina: RT @CDT: Growing China Oil Spill Threatens Sea Life, Water…exploded Dalian pipeline; And: Spill 1… RT @china_csr: New: Zijin Mining Apologizes For Waste Water Leak; RT @BullishChina: Subtributary of China’s Yangtze River experiences biggest flood in nearly 60 years – Xinhua…

9. RT @GreenLeapFwd: #China’s National Energy Administration develops 10 -yr $740 billion “new #energy” investment plan

10. Shame no longer tweeting… RT @GE_Anderson: Janet Carmosky (@janetcarmosky) on why we should be reading China Daily.

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One Response to “Briefly…Top Ten Tweets (From Goldilocks, Growth & Economic Crimes, To Oil Spills, Espionage & SMEs)”

  1. Tweets that mention Archive » Briefly…Top Ten Tweets (From Goldilocks, Growth & Economic Crimes, To Oil Spills, Espionage & SMEs)| China Business Blog -- Says:

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