Part 1 - AHK Greater China

Transcription

C TICKER
DECEMBER - JANUARY
6 | 2009
BEIJING | SHANGHAI | SOUTH CHINA
Free Bi-Monthly Newsletter of the
GERMAN CHAMBER OF COMMERCE IN CHINA
The Changing Face of
Business in China
Emerging Opportunities in the Service,
Luxury and Industrial Sectors
The German Advantage
Mind Your Brand
BA
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New Zealand Calling
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Paradise has a Name
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2009 August - September
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R&D in Shanghai
LL
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A New Hub for Innovation?
2
August - September 2009
Maria Baumann German Bell Thomas Berchtold Monika Bitsche Roman Bösch
2000: 1st Place “Manager Magazin”, Design Annual Report
*
1st Place “Manager Magazin”, Ranking s-dax Annual Report
*
2001:
Ashley Braun Melanie Buhmann Roland Darjes Nick Diehl Cornelia Engler
1st Place “Manager Magazin”, Total Ranking Annual Report
*
1st Place “Manager Magazin”, Ranking m-dax Annual Report
*
2nd Place
Christina Erne Anuschka Fink Hubert Fink Michael Fontain Michael Fröhle
“Manager Magazin”, Total Ranking Annual Report
*
2002: 1st Place
alc (Austrian Leading Companies) Most Dynamic Businesses
Bianca Fels Peter Förg Klaus Forschinger Fabian Gantert Samantha Groeblacher
(Category: “Goldener Mittelbau”)
*
2nd Place
“Manager Magazin”, Ranking s-dax Annual Report
*
3rd Place
“Manager Magazin”,
Yvonne Hanschitz-Orasch Matthias Helbach Cornelia Held Bettina Jäger Lara
Total Ranking Annual Report
*
Bronze
“Berliner Type” Annual Report
*
3rd Place
alc (Austrian Leading Companies) Most Dynamic
Kocab Robert Kastner Cornelia Kaufmann Martin Keim Christian Kräutler
Businesses
(Category: “Goldener Mittelbau”)
*
2003: 5th Place
“Ranking Week” Full Service Agency
*
2nd Place
“Manager Magazin”,
Jaqueline Kovar Kerstin Künzle Tino Le Duigou Christian Lercher Yang Liu Eric
Ranking s-dax Annual Report * 1st Place alc (Austrian Leading Companies) Most Dynamic Businesses (Category: “Goldener Mittelbau”) *
Lin Daniela Loacker Peter Loacker Stephanie Locher Oliver Lorenz Nina Mayer
2004: 5th Place “Ranking Week” Full Service Agentur * 2nd Place “Manager Magazin”, Ranking s-dax Annual Report * Best Design “Manager
Alan Masetti Scott Mastin Irene Mathis Monika Mathis Sabine Mattle
Magazin” Annual Report * Award “Printers Club Award”, Annual Report * 2005: 6th Place “Ranking Week” Full Service Agency * 1st Place
Sven Menzel Richard Morscher Daniela Neumeister Amy Ou Beatrice Purin
“Manager Magazin”, Ranking s-dax Annual Report * 5th Place “Manager Magazin”, Total Ranking Annual Report * Award “Printers Club
Jürgen Raich Fabienne Rieger Johannes Röttger Petra Rumpl Iris Scheibler
Award”, Annual Report
*
2006: 4th Place
“Ranking Week” Full Service Agency
*
1st Place
“Manager Magazin”, Total Ranking Annual
Christian Saubert Natalie Scherer Karin Schertler Marcel Schrattner
Report
*
1st
Place
Total
Ranking
s-dax,
Annual
*
Report
strong
team.
excellent
results.
Michael Schlebes Claudia Schmid Daniela Schnetzer Bernd Schuler Sandra
* Silver Award “Berliner Type” Annual Report * Award “Deutsche Druck Industrie” Annual Report * Award “Deutscher Printers Award“
Schuster Andreas Siegele Sonja Skerbinjek Brian Smith Christian Sturn
Annual Report * Innovation Prize “Deutsche Druck Industrie” Annual Report * 2007: “International Printer of the Year “Sappi Award”
Carola Sturn Nian Sun Volker Troy Denis Vellacher Bernhard Widmann
Annual Report
*
2008: Silver International Calendar Show 2008 * nominated for Design Award 2009 * Gold Medal Golden Award of
Christoph Winder Walter Witschuinig Annie Xia Grace Zhang Tracy Zhang
Montreux
*
Innovation
Prize
“Deutsche
Druck
Industrie”
Annual
Report,
Packaging
and
Displays,
Direct
Mailings
...
klaus (a) · ruggell (fl) · chicago (usa) · shanghai (china)
Room 1101 · 555 Nanjing West Road · 200041 Shanghai · China
Contact person: Oliver Lorenz · [email protected] · Tel. +86 (0) 21 / 52 13 66 00 - 8002009 August - September
3
C TICKER
Publisher
German Chamber of Commerce in China
Offices and Teams in Mainland China:
GC Ticker Team
Managing Editor (Shanghai)
Mr. Bernhard Porpaczy
Ms. Jennifer Smith
Editor (Beijing)
Mr. Kilian Becker
Editor (Guangzhou)
Design (Shanghai)
Ms. Ye Li
Editorial Assistant (Shanghai) Mr. David Finkelstein
GCC l Beijing
0811 Landmark Tower 2, 8 Dongsanhuan (N) Rd.
Chaoyang, Beijing 100004
' 010 6539-6688 6 010 6539-6689
* [email protected]
Executive Chamber Manager
Ms. Katja Sassi-Bucsit
[email protected]
010 6539-6660
Chamber Affairs Manager
Ms. Miao Wang
010 6539-6661
[email protected]
Regional Manager North China
Ms. Claudia Barkowsky
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Editor GC Ticker
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Pudong, Shanghai 200122
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Ext. 1630 [email protected]
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GCC l South China
2915 Metro Plaza, Tianhe (N) Rd.
Guangzhou 510620
' 020 8755-2353 6 020 8755-1889
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GC Ticker is free of charge. For subscriptions or extra copies please e-mail your
nearest Chamber office. Previous issues of the magazine can be found on our
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©2009. German Chamber of Commerce in China. No part of this publication may
be reproduced without the publisher’s prior permission. While every effort has
been made to ensure accuracy, the publisher is not responsible for any errors.
Views expressed are not necessarily those of GIC/GCC
4
Manfred Rothgänger
Delegate & Chief Representative
Delegation of German Industry & Commerce Shanghai
Executive Director | GCC • Shanghai
Endings and
Beginnings
Change is always happening. 2009 has passed quickly, and soon we will see ourselves in a brand
new decade. As celebrations of the past such as the 60th anniversaries of China and Germany
begin to recede into memory, we must turn our attention instead to the future. A new coalition
government in Germany faces further challenges and budget discipline ahead, in spite of painting a
slightly rosier picture for next year with forecasted 1.2% GDP growth and moderately rising exports.
In China, the World Expo 2010 in Shanghai and the 16th Asian Games to be held in Guangzhou are
being watched with great anticipation as the tests of their merit draw near. Events on grand scales
such as these inevitably bring a sense of apprehension; but they also bring opportunity.
China, once known for its cheap labour and exports, is going through a metamorphosis as sudden
and as rapid as its initial burst on to the global economic scene. It has gone from being a supplier
of simple cheap goods, to having everything from giant R&D plants to the fastest growing luxury
market in the world. The growth of its economy despite an otherwise global downturn, proves
its resilience and shows that opportunities have not dried up here - they’re simply taking on a
new look. This issue of GC Ticker will hopefully shed some light on these changes, allowing for a
prosperous year for everyone and some opportunities ahead for German business.
By the time this issue of GC Ticker reaches you, we will have passed our social calendars’ highlight:
the German Balls in both Beijing and Shanghai which are featured in a special colourful insert.
Celebrations like these remind us that the people we surround ourselves with are what truly make
events memorable. Much has happened in the past year, but as always, there is more just over the
horizon.
With December coming to a close, the boards and teams of the German Chamber of Commerce in
China would like to wish all our members continued success, health and happiness in 2010.
Have a Merry Christmas and a Happy New Year!
Sincerely,
GCC All-China Board Members
Dr. Richard Hausmann
Chairman, GCC l Beijing
CEO and President
Siemens Ltd. China
Ms. Jutta Ludwig
Executive Director
GCC l Beijing
Mr. Arved von zur
Mühlen
Chairman GCC l
Shanghai
Managing Director
Greater China
Lufthansa German
Airlines
Mr. Manfred Rothgänger
Executive Director
GCC l Shanghai
Southern China
Lufthansa German
Airlines
Mr. Nico Beilharz
Chairman
GCC l South China
General Manager
Ms. Alexandra Voss
Executive Director
GCC l South China
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CONTENTS
Business Focus
Community
8
News from Berlin and Brussels
67
Expo News
10
Member News
Beijing
Shanghai
South China
68
Environment
24
34
friendly building technology
Cover Story: The Changing Face
of Business in China
A look forward examining the
emergence of new opportunities in the
Service, Luxury, and Industrial sectors
74
Regional Spotlight:
North China: Work in Langfang
South China: Moving Up in Qingyuang
East China: R&D in Shanghai
32
46
64
Meet the Member:
Jörn Hasenfuß: Shanghai Volkswagon
Arding Hsu: Siemens Limited China
Ronnie Cheng: The Garden Hotel,
Guangzhou
35
70
Training & Education
72
Sports
73
Health
74
Food
Chamber News
International culture exchanges and how
your youngsters can get involved
German football pros are leading the way for
athletics and education in the South of China
A leaf for all seasons: learn how to stay
warm this winter with the right kind of tea
38
Chamber Notices
40
Beijing
75
New Books
A heavy focus on branding in Beijing was
accompanied by the election of the new
Tianjin Board of Directors
76
Art & Culture
80
Travel
82
City Tour
84
This & That
85
Church Calendar
86
Chamber Events Calendar
50
62
‘Germany and China’ to hit Wuhan
this autumn
Green Walls offer a new take on eco-
Shanghai
Making progress with Euro-China business
relations and a shift in expat mindsets were
the issues covered at the latest Chamber
Meetings
South China
Ambassador Dr. Michael Schaefer spoke
about political and industrial progress at
his recent stint in Guangzhou
Culinary compatriotism in the North
Postcards, People, Premises: three exposés
on unique art projects within their fields
Breathtaking views from the land of the Kiwis
Taking a ride on the right side: a new mode
to explore Shanghai’s wonders
82
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7
BUSINESS FOCUS
NEWS FROM BERLIN AND BRUSSELS
NEWS FROM
BERLIN AND BRUSSELS
EU Wants to Tackle Urban
Traffic
Brussels. The EU Commission is paving
the way to authorise the collection of fees
from cars and trucks for traffic jams, noise
pollution and emissions. These are only a
few of the many ideas that the Commission
is considering as part of its action plan for
urban traffic. The DIHK disagrees not only
with the idea of allocating external costs,
but opposes the EU’s jurisdiction in this
area. Urban traffic problems clearly fall under the responsibility of local authorities. It
will therefore continue to insist that the role
of the EU concerning urban traffic should
be limited to the exchange of best practice.
With over one year delay, the European
Commission had published its action plan
for urban traffic in late September.
Contact: [email protected]
© Rainer Sturm / Pixelio
EUR 11.3bn Needed to Fill the Gaps
Berlin. Already 1,090km of the entire network of German motorways (Autobahn)
are dealing with traffic jams on a daily
basis. Therefore it has become necessary to
increase capacity through additional lanes.
Furthermore, existing gaps in the network
will be filled by 336km of new road construction. The DIHK estimates the total needed
investments at EUR 11.3bn. To support the
German Economy, the new roads should be
completed within the next six years, which
will only be possible if the Federal Government will supply additional funds and the
prioritisation of projects focus on actual
traffic demands. Besides that, it is essential
to implement plan approval procedures on
time and conclude them quickly.
No Extension of Warranty Terms
Brussels. The DIHK is strongly resisting plans from Brussels to extend warranty
terms from two years up to four from the
date of purchase. “This will have an effect on
the aggregate costs of companies and eventually the prices consumers have to pay”, said
DIHK Managing Director Martin Wansleben
is advising against it. The responsible Council Working Group has been asked in an urgent letter to reject such intentions; otherwise
Europe will lose much of its appeal as a business and industrial location. Some member
states want to double the warranty terms.
France has even called for 10 year terms in
certain circumstances. If those member states
achieve acceptance of their suggestions, an
overall increase of prices will inevitably occur. Products in the lower price segment may
likely disappear altogether.
Managerial Salary – What
is Considered Adequate?
Berlin. Just after new laws on appropriateness of managerial salaries as well as tighter
guidelines on salaries for managers of credit
institutions have entered into effect, demands for additional regulations arose. The
revived discussions include upper salary
limits, women’s quota on board level and the
waiving of bonus payments in state-aided
companies. “It is not a political problem, but
an ethical one”, emphasises DIHK President
Driftmann. The organisation stipulates that
companies, in this case the board of directors, need to remain capable to act freely
even with a regulated allowance system in
place. The new requirements are significant
and are likely to cause legal uncertainty in
many cases. Hence, the DIHK calls for no
further interference into the freedom of contracts for private-owned companies.
Credit Summit with DIHK as Driving Force and Agent
Berlin. DIHK-President Hans Heinrich
Driftmann invited participants to a summit
talk titled “Supply of credits to the economy”. It became necessary due to the difficult financial circumstances of companies at
the moment. Leading trade and banking associations along with Finance Minister Peer
Steinbrück gathered to analyse the situation
and discuss aids to improve conditions for
companies. The participants of the summit agreed that there is no comprehensive
credit crunch yet, nevertheless problems
are increasing. This has also been proven
by a survey conducted by the IHK on credit
8
December - January 2009/2010
conditions. “This background turns financing into the crucial question in Germany’s
economic revival” exhorted Driftmann. The
economic downturn may not be followed
by a financing crisis for the real economy. In
order to improve the credit supply in many
sectors the summit members settled on a
statement, which the DIHK President called
“an important step for a growing common
ground among politics, credit sector and real
economy concerning the substantial questions of corporate finance.”
Finance
Minister
Steinbrück at the Credit Summit
© Rainer
SturmPeer
/ Pixelio
in Berlin. © Jens Schicke
AD Binhai Huinang
2009/2010 December - January
9
BUSINESS FOCUS
MEMBER NEWS BEIJING
MEMBER NEWS
BEIJING
Banking on Green
Westward Bound
In October, Deutsche Bank participated in
the ‘German Esplanade’ held in Wuhan.
The exhibition showcased some of Deutsche
Bank’s most important sustainability projects, which were highlighted under the
theme “Banking on Green.”
Following the opening of branches in Beijing,
Shanghai and Guangzhou since 2008, HALFEN Construction Accessories Distribution
Co. Ltd. accelerated its development and
expansion in the Chinese market with a new
office in Chengdu in September.
Three of the bank’s major sustainability initiatives were displayed in the Deutsche Bank
pavilion. The “Solar Impulse” project will
send an ultra light manned aircraft around the
world in 2011, powered entirely by the sun
without emitting pollutants. “Greentowers”
represented the modernisation and renovation
of Deutsche Bank’s company headquarters in
Frankfurt with the aim of reducing the building’s energy consumption and CO2 emissions
by at least 50%. “Urban Age” serves as an ongoing forum on sustainable urbanisation and
city planning in the 21st century, providing
USD 100,000 annually to projects that improve
the physical conditions of communities and
the lives of their residents.
Top managers of HALFEN GmbH and its
mother company CRH – an Irish EUR 20bn,
sales building materials company – came to
China on this occasion to review the company’s business model in the Chinese market.
The delegation was impressed with the ever
increasing potential for application of its main
products, channels and flexible bolts.
With the establishment of its new strategic
base in Chengdu, HALFEN will tap into the
large western market to supply systems and
offer its expertise in a variety of fields ranging
from infrastructure and utilities for commercial buildings and transportation to various
industrial applications.
Local Representative
Commerzbank AG Tianjin Branch became
operative on 9 th September 2009, making
Commerzbank the first German bank to set
up shop in this Northern Chinese city. Martin
Miller, who has managed the Commerzbank
Representative Office in Beijing for the past
four years, has been appointed branch manager. Ten employees will work in the new
branch, which is centrally located in Heping
District.
In line with Commerzbank’s cross-border
10
strategy the new branch focuses on corporate
customers, providing services ranging from
account maintenance and payments over
financing and hedging to subsidiaries of German companies in Tianjin and in the neighbouring provinces of Shandong, Liaoning,
Jilin and Heilongjiang. The branch will also
provide client services to Chinese corporate
clients with subsidiary ties there. Besides
Tianjin, Commerzbank in China has branches in Beijing, Hong Kong and Shanghai.
Chicken Power
Jebsen Industrial recently provided a
leading Chinese agriculture enterprise in
Shandong with advanced power generation engines that utilise chicken manure
to generate electricity. The engines tap the
biogas released from processing 500ts of
waste from five million chickens to generate up to 72,000kWh of energy daily. This
not only reduces methane emissions, but
also relieves the stress on the electricity
supply in suburban areas. The project
reflects Jebsen Industrial’s firm commitment to supporting the development of new energy in China. It
addresses two challenges faced by
China: controlling waste emissions
and increasing independence from
coal power generation in the country.
Jebsen Industrial first cooperated with
GE Jenbacher to establish a power plant
that processes chicken manure in a largescale chicken farm situated in a northern
suburb of Beijing, commissioned earlier
this year. The first of its kind in China,
the plant has an annual power capacity of
14,600,000kWh.
Revisiting Opportunity
Dr. Karl-Ludwig Kley, Chairman of the Executive Board of Merck KGaA, announced the
first Merck acquisition in China during his
visit to China in September. The acquisition
of Suzhou Taizhu Technology Development
Co. Ltd. Taizhu is of high strategic importance
to the Merck pigments business and Merck’s
chemical business in China.
Dr. Kley also met with strategic stakeholders to reemphasise Merck’s long term vision
and investment in China. In meetings with
Huang Jiefu, Vice Minister of MoH, and Mr.
Shao Mingli, Commissioner of SFDA, Dr. Kley
emphasised Merck’s commitment to supporting China’s efforts in addressing infertility
patients’ needs and enhancing Merck Serono’s
R&D capability in China. Dr. Kley also met
with Mr. Jiang Zhuoqing, Deputy Secretary of
the Shanghai Municipal Committee, Mr. Lu
Liu, Mayor of Taicang City, and partners from
Taizhu to review cooperation opportunities in
Southern China.
www.china.ahk.de
Orchestrated Effort
Years in Brief
For the first time in history, the Leipzig
Gewandhaus Orchestra visited China. As
official logistics partner of the world famous
orchestra, with 185 musicians one of the
biggest professional orchestras in the world,
DHL handled all transports in China and international logistics concerning the valuable
musical instruments throughout the Asian
tour that kicked off in Shanghai in October.
Following another performance in Beijing,
the Orchestra continued its tour in Japan.
This year, China Briefing celebrated its 10th
anniversary with two special events: in July,
a big party was held at Shanghai’s Kathleen’s 5 and another took place at Beijing’s
exclusive Capital Club. In Shanghai alone,
more than 250 guests – long-time subscribers, diplomats, clients and friends – gathered
until late to wish the magazine a happy
10 th birthday. They celebrated with Chris
Devonshire-Ellis, founder of Dezan Shira &
Associates, the company behind China Briefing whose professional tax and legal consultants also contribute most of the magazine’s
content.
Many of the Gewandhaus Orchestra’s
instruments are unique and virtually irreplaceable. One of the greatest challenges
involved was maintaining a constant temperature – ideally 18–20° C - throughout the
entire haulage period, as greater variations
in temperature can lead to cracks in the
instruments and thus lasting damage. Air
suspended vehicles and form-fitted packaging protected the more than 100 instruments
with a total weight of over six tons.
China Briefing magazine has been published
in China since 1999 on a monthly basis. It is
also available for download in French, Italian, German and Spanish along with its own
daily online business news blog.
Big Potential
Solar Expansion
The German manufacturer of heating technology Viessmann opened a factory for
high quality solar products in Dachang near
Beijing at the end of October. At the opening ceremony, Dr. Martin Viessmann, owner
and CEO of Viessmann Group, stated that
the total investment in the new 16,000m²
plant amounted to EUR 5mn. The factory
employs a work force of over 300 people. The
Dachang solar plant is the second investment
by Viessmann in a WFOE in China after setting up a production site for wall-hung boilers in Beijing, which was opened in 2002.
Viessmann Group has over 8,600 employees
worldwide. In China, Viessmann’s presence
dates back to 1997. Since then the German
family run company has gained a great reputation for its highly efficient small and big
hot water and steam boilers.
By 2012, Siemens China expects to generate new orders worth more than RMB 20bn
from the government’s RMB 4tr stimulus
package. The forecast is based on a systematic analysis of the government investment,
which focuses on areas such as industry
structure upgrade, transportation, power
grid infrastructure, environmental protection and healthcare. Given the company’s
average share in these markets, Siemens eyes
RMB 20bn from the stimulus package.
“The Siemens portfolio fits well into China’s
macro stimulus plan,” President and CEO
of Siemens China, Richard Hausmann, commented. “The planned investments in infrastructure, energy and healthcare account for
approximately 50 percent of the total stimulus package; these are all areas in which we
are strong. As the programme carries on,
we see great potential to further expand our
share in the package.”
11
BUSINESS FOCUS
MEMBER NEWS SHANGHAI
MEMBER NEWS
SHANGHAI
Ritz-Carlton Named Top 25
On 23rd Sept 2009, The Portman Ritz-Carlton
was named one of the “Top 25 conference
hotels in Asia” by SmartTravelAsia.com
readers. Mr. Vijay Verghese, Chief Editor of
SmartTravelAsia.com presented the award
to hotel General Manager Manfred Weber.
The 610-room hotel is a landmark located in
a retail, dining and entertainment complex
on the famous Nanjing Road. Situated right
in the heart of the commercial, shopping and
entertainment district of the city, services
and facilities include six restaurants and
lounges serving Chinese, Italian, Japanese
and Western favourites. An extensive health
club with swimming pool, gym, squash and
racquetball courts is featured alongside a
wellequipped business centre.
Taylor Wessing Welcomes Dr. Sven-Michael Werner
Rimagine Celebrates Five Years
Dr. Sven-Michael
Werner, Partner of
European law firm
Taylor Wessing, has
been relocated from
Munich to Shanghai
in October 2009. Dr.
Werner is a corporate
lawyer with extensive
experience in M&A and Private Equity transactions in China. Besides his German law degree
he holds a Hong Kong law degree in Chinese
business law. He has worked with Taylor Wessing’s China Group for six years and will further
strengthen the capabilities of the firm’s Shanghai office to advise clients on M&A and Private
Equity transactions in China.
The Shanghai office of Taylor Wessing has
existed since 1996 and was one of the first European law firm offices established in China.
Together with a second office in Beijing and
China practitioners in Munich, Frankfurt,
London and Paris, it assists European clients
with their business operations in China.
Voith Relocates
Geberit Shanghai Gets Certified
On 8 August 2009, Voith Industrial Services
Shanghai moved to its new location at Room
308 of Innov Tower, 1801 Hongmei Road,
Chaohejing Hi-tech Park, Shanghai. A grand
relocation ceremony was held with the
whole Voith Industrial Services China management team and representatives of each
division in China.
Geberit Shanghai was recently awarded official recognition by the Shanghai Municipal
government as “Regional Headquarter of
Multinational Corporation”. In a ceremony
at the city hall Geberit, represented by Dr.
Christian Kober, COO Asia Pacific, was
awarded the coveted “Regional Headquarter” status from Vice Major Mr. Tang Dengjie.
This status is recognition by the authorities
that a company has been a responsible corporate citizen and has a long term vision for
its development in China and the region. Besides that, it will also bring practical benefits
in terms of working visas and taxation.
The timing of the award coincides with Geberit’s new Asia Pacific Headquarter project
in Nanxiang, which is expected to be completed by beginning of 2010. With a total
investment of approximately CHF 20 million,
the new facility including production infrastructure, office spaces, customer training
centre as well as the regional R&D Competence Centre underlines the commitment
of the Geberit Group for successful further
development of the Asia Pacific Region, with
a key focus on China.
On 9th September 2009, German-owned and
managed photography company Rimagine
celebrated its five year anniversary in style
with a major anniversary party at the company’s headquarters in Shanghai. More than
250 guests attended the event. All three studios
were transformed into a single party space
with large video installations, interactive photo
calls, DJs, lounge areas, cocktails and catering.
In their welcome speech, co-founder and
General Manager Lorenz Wagener and
John Ray, Director of Operations, specially
thanked all their talents, clients and partners
for the trust, support and commitment provided throughout the first five years. “It was
both a proud and rewarding moment for our
entire team to see all the people who have
been so supportive to us and who made all
this possible. We truly thank everybody for
this experience and already look forward to
the next five years,” remarked Wagener.
th
Voith Industrial Services is a division of
Voith and one of the leading suppliers in the
area of industrial services: from planning,
engineering and assembly to maintenance,
technical cleaning and facility management.
The company started to operate in China in
1998. It provides customised and fully integrated industrial services to manufacturers
in China, assisting them in achieving world
class production standards under local environment. With an expanded office space, and
the merger of Hoermann, Voith Industrial
Service will continue to develop its business,
offering customers a broad range of industrial services.
12
www.china.ahk.de
BLG Appoints New Partner
New Garden Pavilion at Millennium
B a r l o w Ly d e &
Gilbert LLP (BLG)
has announced
the appointment
of Brinton Scott to
lead its Shanghai
office and drive the
future development
of its China Practice. Brinton’s appointment
follows the recent appointment of David
Smyth as the firm’s new Managing Partner
for Hong Kong and China.
The Millennium Hongqiao Hotel features a
garden complete with tranquil fish ponds
and intricate pagodas. To add to the lush
landscape, the hotel recently launched its
840m² Garden Pavilion. Equipped with the
latest AV system and air-conditioning, Garden Pavilion is a unique venue for year-end
celebrations, weddings, car expos, and for
companies to launch new products.
Brinton has worked in China for the past 12
years. He has worked in an array of sectors
and has extensive experience in advising
Fortune 500 and large private multinational
corporations in foreign direct investment,
mergers and acquisitions, reorganisations,
joint ventures, employment, intellectual
property and technology and licensing. Brinton’s appointment is another significant step
in BLG’s international strategy to develop
the full potential of its team in China and
across Asia. The firm will continue to focus
on its Asia investment and to build on the
team’s core strengths to provide the best service to its clients.
Ng Engages Audiences
On 1 st June 2009,
C.J. Ng of Directions
Consulting became
the first and, to date,
the only Chinabased sales trainer to
be invited to speak
at the American Society of Training &
Development (ASTD) International Convention in Washington D.C. C.J. spoke on “Optimising Your Sales Training Effectiveness
in China” and was voted one of the most
engaging sessions in the convention. His
presentation can be downloaded at www.
psycheselling.com/M120.mp3
The 368-room Millennium Hongqiao Hotel
is located close to Shanghai Mart, Shanghai
International Trade Centre and at the corner
of Carrefour Gubei. With its convenient location, the hotel is a mere 10 minutes drive
away from the city’s domestic Hongqiao
Airport and has easy access to all major
road arteries. It is part of Millennium and
Copthorne Hotels, which has over 120 hotels
worldwide, including the Grand Millennium
Hotel Beijing and hotels in Wuxi, Qingdao,
Xiamen and soon also in Chengdu.
Sheraton Hosts Expo Meeting
Pullman Hosts Arts Fair
Sheraton Shanghai Hotel & Residences, Pudong and Four Points by Sheraton Shanghai,
Pudong recently hosted one of the biggest
events in the city – the Fourth Participants
Meeting of the World Expo Shanghai China
2010. More than 900 delegates from all the
participating Shanghai Expo Pavilions and
representatives from 156 countries and 200
international organisations attended the
event in the hotel’s Grand Ballroom.
The 11 th China Shanghai Performing Arts
Fair was held at the Pullman Shanghai Skyway from 17th-23rd October. The announcement was made during the signing of the
exclusive sponsorship agreement between
the hotel and the Arts Fair organising department earlier this autumn. The agreement
was made official by Ms. Wei Zhi, Vice President of the Exhibition & Fair Department for
SPAF and Mr. Bosoc Zhu, Director of Sales
& Marketing for Pullman Shanghai Skyway.
“We are delighted to be able to support such
a prestigious and well established arts event
in Shanghai”, said Pullman Shanghai Skyway General Manager, Mr. Klaus Gottschalk.
The event attracted more than 100 delegates
of International Performing Arts Agencies
from over 30 countries in the lead up to the
Shanghai Arts Festival.
As the nearest international brand hotel to
the 2010 World Expo site, the two-hotel complex by Sheraton and its General Manager
John O’Shea, are ready to host World Expo
participants and also guests coming for business or leisure.
Mr. Bosoc Zhu and Ms. Wei Zhi
CCTV 1 at Oldenburger for German Pavilion at Expo
A team of Chinese TV visited the plant of
Oldenburger Interior Products (OIP), where
a mock up of furniture and wall elements
for the German Pavilion were presented by
Ansgar Niemann, Head of Production OIP,
and Jürgen Blattert, Senior Project Manager
of ExpoTechnik, to the architects of Nüssli,
Playze and Schmidhuber & Kaindl. A consortium of ExpoTechnik and Oldenburger
together with their Chinese partner APEX
won the tender for furniture and interior
products.
After recording the successful mock up presentation, CCTV Editor Ms. Li Bing went
with her team to film the production of high
quality furniture at the OIP plant. The 45
minute feature film of the Shanghai Expo
and the German Pavilion was broadcasted
on October 10th. The German-Chinese consortium is now manufacturing all the different elements for the interior of the German
Pavilion to present German craftsmanship
and quality at the opening of the Expo 2010
next spring.
Oldenburger Interior Products (Shanghai) Co., Ltd.
198 Zhong Chuan Road, Anting Town
201814 Shanghai China
Tel 021 5950 2758 | Fax 021 5950-2759
www.oldenburger.com
13
BUSINESS FOCUS
New EXPOTECHNIK Shanghai Office
team of 20 designers, architects and project
managers. An integrated showroom displays
state-of-the-art 3D concepts for exhibitions,
events and environments. The investment
is in line with EXPOTECHNIK’s long-term
commitment to its international and domestic customers in China.
Global brand architecture company EXPOTECHNIK relocated its Shanghai premises
in September. The new office is located at
BEA Tower, opposite of Citibank Tower and
Shangri-La Hotel in Shanghai’s Lujiazui
financial district. It houses an international
Headquartered in Germany for more than 40
years, EXPOTECHNIK develops and realises
creative concepts for multinational corporations and brands in three-dimensional architecture. With the aim of providing a truly
global and consistent service, the company
sustains proprietary subsidiaries in Frankfurt, Atlanta, Mexico, Singapore, Tokyo,
Melbourne, Sydney and Shanghai at the new
contact below:
EXPOTECHNIK Shanghai | BEA Tower, 12F | 66
Hua Yuan Shi Qiao Road | Shanghai, 200120,
Lujazui | China | T +86 21 5061 9570
New Holiday Inn Sales Director
GOTO Partners with SEAS
Since Q4 of last year, the global electronics
manufacturing market has been in a “cold
winter”. Under such a stringent economic
situation, Shenzhen GOTO Digital Technology Co. Ltd. has been an exception, increasing its investment. In April 2009, GOTO
invested in SEAS’ 8 SIPLACE SMT production lines for its mobile phone and netbook
production.
GOTO explained the reason for enlarging
investment during these uncertain times
with the highly promising outlook of the
subsequent development. The company has
full confidence in the electronics manufacturing industry in China. The innovations,
confidence and commitment by the Siemens
team made the decision for GOTO to select
SIPLACE equipment an easy one. Four production lines were installed in May 2009.
Since then, GOTO has been quite satisfied
with the quality and after-sales services and
promised future cooperation with Siemens.
Vivian Cao has been appointed Director of
Sales & Marketing at the “refreshed” Holiday
Inn Shanghai Vista. The hotel has re-launched
to include a renewed commitment to friendly,
attentive service in line with a more contemporary and stylish look and feel. The hotel’s
re-launch is part of a worldwide initiative by
Holiday Inn® Hotels & Resorts to create a new
identity and establish new brand hallmarks
that will deliver a more consistent quality and
contemporary image for the brand. Vivian has
been in the hospitality industry for over 10
years at various hotels
such as JC Mandarin,
Ramada Pudong
Airport Shanghai
and Howard Johnson
Business Club Hotel.
Prior to moving to
Holiday Inn Shanghai
Vista, she was Director of Sales of InterContinental Pudong
Shanghai.
Shanghai Dongjin New
Appointment
ICIS Names LANXESS
‘Company of the Year’
New Director at Matsu
Furniture
Shanghai Dongjin
Business Consulting Co. Ltd, an
investment and accounting consulting
company, is pleased
to announce the appointment of Carlo
Geremia as the head of its legal consulting
department. Mr. Geremia previously worked
with Simmons & Simmons, an international
law firm in Shanghai for several years. His
main areas of practice are direct investment,
technology transfer and employment.
ICIS Chemical Business magazine, one of the
world’s leading information providers for
the industry, has named German specialty
chemicals company LANXESS ‘Company
of the Year’. “The ICIS Company of the Year
Award goes to LANXESS for its outstanding financial performance in a challenging
2008,” said Joseph Chang, Global Editor of
ICIS Chemical Business. “We congratulate
LANXESS and its CEO Axel C. Heitmann.”
Leading German
office furniture
manufacturer Matsu
Shanghai has appointed Mr. Xiung
Tien as Business Development Director.
Previously, Mr. Tien
worked in business
development for
construction industry, mainly responsible
for German speaking clients. Mr. Tien, who
was born in Stuttgart, Germany, has more
than three years of experience in the Chinese
market, and a rich background in the sales
and finance sector in Germany.
Matsu has witnessed 13 years of solid
growth in China, serving both local and
multinational corporate clients. With its office furniture solutions, the company aims
at creating total environments that make for
more enjoyable work places.
In an effort to provide useful information to
the business community, Shanghai Dongjin
is now organising various seminars on the
most recent updates regarding investment
policies, corporate, foreign exchange and tax
matters. Officials from the relevant Shanghai
authorities will attend as speakers.
14
ICIS Chemical Business magazine selected
LANXESS for this award on the grounds
that the company had increased net profit
by 53% to EUR 171mn on nearly flat sales of
EUR 6.58bn in 2008. This is despite a sharp
drop in fourth quarter demand. In addition, its management and workforce reacted
promptly and effectively to the downturn,
and the company achieved its growth and
financial targets over the course of 2008 – a
year ahead of plan.
www.china.ahk.de
New Hamburg Süd Office
Hella Grand Opening
On 28 th August, Hella Xiamen Automotive Electronics Co. Ltd. held the opening
ceremony for its new production lines. The
lines are the first two introduced from the
USA, with another four lines planned to follow. As part of the company’s worldwide
electronic business strategy, the lines were
introduced to strengthen the production and
R&D capability of Hella Xiamen on electronics parts. All six production lines will be
fully transferred by
2010, doubling the
production capacity of the plant and
increasing its output value by RMB
200mn. Xiamen is
expected to be the
only production and R&D centre for Hella
relays worldwide.
Vossloh Secures New Contract
Vossloh’s success story in China started in
2006, when it secured the first order, worth
EUR 185mn, for the Beijing-Tianjin and the
Wuhan-Guangzhou high-speed passenger
lines. The first fasteners produced at the
Chinese plant were supplied in October
even before the plant’s official opening in
November 2007. High-speed trains flitting
at top speeds of up to 350 km/h now whiz
over them.
To date, Vossloh has invested some EUR
16mn in Kunshan, where around 100 employees produce up to ten million tension
clamps per year. The sequel to the success
story is currently being written. In June 2009,
Vossloh won a contract for an estimated
value of EUR 170mn. “We are of course very
proud that the Chinese government has
again entrusted us with such a major contract. The fact that we will be equipping the
Beijing-Shanghai line with Vossloh fasteners
is, however, certainly something special,”
notes Thomas Dorn, General Manager of
Vossloh Fastening Systems China.
The Shanghai Office of Hamburg Süd (China) Ltd. relocated its premises in December.
The new office is in the Sail Tower Han Kou
Road, located at the junction of Jiuliang
Road and Henan Road in Puxi.
“Despite of the global economic downturn
and reduced demand for ocean transports
2009, Hamburg Süd continues to consider
China as one of the most growing areas in
the world”, remarked Michael Kuemmel,
General Manager of Area North and Central
China. With the exception of the current
year, the company saw fast-growing rates in
volumes and required to hire additional staff
to maintain its quality services to its customers. The investment of relocation shows the
long term commitment of the Hamburg Süd
Group to service its international clients in
China and overseas. The Shanghai office is also
the company’s
regional China
headquarters,
overlooking the
activities of Hamburg Süd branch
offices throughout
China.
Quality is our business. 德国品质中国制造.
More than 5 years experience in Asia and more than
130 years experience in Germany make us your best
partner for your next
EXHIBITION, EVENT, INTERIOR, MUSEUM, ENGINEERING.
We provide solutions.
Beijing 2008 Olympic Games
VW Showcase, 2100 sqm
Shanghai Motor Show 2009
Mercedes-Benz, 3000 sqm
Ambrosius Exhibition Design and Building (Shanghai) Co., Ltd.
Suite 2504 / Sheng Gao International Mansion No. 137 / Xian Xia
Road 200051 Shanghai / ph. +86(21)62285533 / m. +86 18601790188
[email protected]
2009/2010 December - January 15
BUSINESS FOCUS
DB Schenker in Kunshan
DB Schenker China opened a new 15,000m2
distribution centre in Kunshan, Jiangsu
Province effective 15th September. The nonbonded warehouse will complement the
company’s dense warehouse network in the
Shanghai/Suzhou area.
The facility is equipped with new pallet racking (more then 10,000 locations), large block
storage area, covered outdoor storage space
and a new Warehouse Management system.
Services provided at the new premises are
such as receiving, checking, storage and pick
& pack for mainly industrial customers. Export services include container stuffing on
six specially designed ramps, customs clearance as well as trucking services.
With more than 4,800 employees in over 55
offices and over 40 warehouses with combined space of 420,000m2, DB Schenker is one
of the leading logistics companies in China.
Evonik Lighting the Way
Heidelberg Open House
Heidelberg China has successfully organised
the Can-Do open house in its Shanghai
Qingpu factory on 15th September with the
slogan “Made by Heidelberg – German
Quality and Technology”. The complete
Qingpu product portfolio was on display.
More than 300 customers from all over
China participated in the four-day event. On
18 th September, an
international day
also greeted guests
from the Asia Pacific
region, including
Malaysia, Korea
and Nepal. Many
visitors were visibly
impressed by the
display of machine
assembly lines, advanced manufacturing methods as well
as the sophisticated
German technology.
Heidelberg’s Qingpu assembly plant in
Shanghai was officially inaugurated in September 2006. It is the first production site of
Heidelberg Group in China and Asia. The
Can-Do open house offered a great opportunity to the company’s customers to see for
themselves how a Heidelberg machine is
born.
Psyma-China Gets Certified
METRO Eyes World Expo
Market researcher Psyma-China has joined
forces with US-based Focus Vision to offer
video conferences and virtual focus groups
from within China. This innovative service
enables clients from around the world to
watch focus groups and in-depth interviews
in real time. Psyma-China is one of only a
few companies in China certified by Focus
Vision. Clients can interact with participants
while the video conference is in progress.
More information can be found on PsymaChina’s website.
With World Expo 2010 drawing near, METRO Cash & Carry - a global leader in selfservice - has geared up for the upcoming
event.
16
On 1st September, METRO China invited 16
catering firms including six from the Expo
area to a customer panel. There, METRO
staff introduced its advanced food safety
management system, provided basic training to prepare the caterers for the Expo and
presented its assortments. After the presen-
Germany-based Evonik Industries AG and
Taiwanese Cristal Material Corporation have
formed a new joint venture to manufacture
high-quality glass lenses for next-generation
LEDs. These will be marketed under the Savosil™ brand. The Evonik Cristal Materials
Corporation joint venture will complement
Evonik’s strategy as a solution provider to
the lighting industry while providing Cristal
Material Corporation access to a highly innovative market.
The LED lenses will be produced using
Evonik’s patented SiVARA™ Sol-Gel technology, which allows glass lenses of consistent quality to be manufactured in any
desired shape. The process recently received
the Frost and Sullivan European Technology
Innovation Award. Compared to conventional light sources, such as incandescent
lamps and energy-saving lights, LEDs are
much more energy efficient, last longer, and
offer many new design possibilities. Because
of these advantages, LEDs are increasingly
used in many different lighting applications.
tation, customers paid a visit to METRO Putuo store to have a first-hand experience of
METRO’s traceable Star Farm food products.
After the successful supply of food products
to the 2008 Beijing Olympic Games, “MCC
China is ready to once again feature in the
big events,” said Tino Zeiske, President of
METRO Cash & Carry China. “We will work
closely with our professional customers to
get ready for the Expo with our pioneering
food safety solutions.”
www.china.ahk.de
ICFG Meeting at Hirschvogel
The 42nd International Cold Forging Group Plenary Meeting was
held from 20th to 24th September 2009 in Shanghai. The ICFG is an
international association consisting of scholars and engineers from
universities and industry who are specialised in cold bulk forming
topics. The plenary meeting is held once yearly. This was the first
time it was held in China.
After a two-day plenary meeting held at the Jianguo Hotel in Shanghai, several industrial excursions to local forging enterprises were
arranged. On 24th September, Hirschvogel Automotive Components
(HAC) welcomed around 45 guests at its premises in Pinghu. After a
company presentation the delegation was guided through the plant
in smaller groups to see the production process. Guests were very
impressed by the plant tour, especially because of the automated
forging facilities and the cleanliness on site.
New QIAGEN Asia HQ
QIAGEN officially opened its new Asia headquarters in Zhangjiang High-Tech Park, Pudong, Shanghai on 8th September 2009. The
company is an industry leader in the life science reagents and molecular diagnostics fields that sells testing kits and equipment for
H1N1, Avian Flu, HIV, Hepatitis, etc. The opening was marked by a
ceremony hosted by the company’s CEO, Mr. Peer M. Schatz, and attended by representatives from industry and public administration.
QIAGEN established Shanghai as the location for its Asia headquarters in 2006. Resources and employees that were previously
spread across different locations throughout the city are now consolidated at the new site in the Landscape Park development of the
High-Tech Park. The move to a larger space is indicative of QIAGEN’s rapid growth throughout the Asia region and specifically
in China. The company’s Asia operations have expanded from 8
people in 2005 to over 400 in 2009.
17
BUSINESS FOCUS
SEAL Appoints New General
Manager
Mr. Axel Gebhardt
has been appointed
as the new GM of
Siemens Electrical Apparatus Ltd.
Suzhou (SEAL), effective from 1 st Oct
2009. Mr. Gebhardt,
who holds degrees
in Electrical Engineering and General Science/Economics, started his career with
Siemens in Berlin in 1984. He has since then
held various positions in quality, production
and management in several countries.
Liebherr Becomes Important NPP Supplier
The construction of nuclear power plants
(NPP) has developed rapidly in China in
recent years. Having to comply with strict requirements for the batching precision, mixing
quality and temperature control, the batching
plant needs to be not only suitable for construction in cold winters, but also during hot
summers.
The batching plants provided by Liebherr
Machinery (Xuzhou) Co. Ltd. have won the
trust of the builders of nuclear power plants
through their advanced technology, high
quality and reliable property. In the past
three years, a total of 16 units of batching
plants were purchased by five nuclear power
plant projects: Fujian Fuqing NPP project,
Guangdong Taishan NPP project, Shandong
Shidaowan NPP project, Guangxi Fangchenggang NPP project and Jiangsu Tianwan NPP
project. Now, Xuzhou Liebherr’s batching
plants are playing an important role in the
construction of these nuclear power plants.
arvato Grows Big in South China
arvato logistics service China Limited expanded rapidly in South China this year
after holding its opening ceremony in February of 2009. In less than one year, arvato
set up branch companies in Shenzhen,
Guangzhou, Foshan, Shantou, Nanning and
Xiamen. The company also plans to open
branches in Changsha and Nanchang by the
end of the year.
arvato is a member of the Bertelsmann
Group. It offers one stop supply chain man-
agement solutions, including customised IT
systems, warehousing, delivery, final assembly or customisation of products, procurement, order management, hub management,
customer care, value-added services and
management of all finance services including COD services. “We provide professional
logistics service to our clients here and are
dedicated to our clients and China,” says
Raoul Kuetemeier, the CEO of arvato logistics service China.
New Director at Shanghai UBM
Mr. Björn Kempe was appointed as Director
for International Marketing & Sales at UBM
Sinoexpo in August 2008. He has gathered
various experience in the exhibition and
event industry and was working for Cologne
Trade Fair and Munich Trade Fairs before.
He is also the publisher of two books on intercultural communication and negotiation.
UBM Sinoexpo is one of the largest trade
fair organisers in China. The upcoming leading shows in spring– Expo Build, Hotelex,
Clean Expo and China International Boat
Show - will present German companies and
manufacturers. Several co-operations i.a.
with econet and VDMA have been made to
promote German design, hospitality services
and cleaning industry at these exhibitions.
18
UBM also signed an agreement for the UK
London Hall at the Shanghai World Expo to
promote sustainable building products. Mr
Kempe invites all partners and members to
join. For further information please visit the
company’s website.
“I am very happy to come back to China
since I got to know the Chinese people and
culture during my assignment to Shanghai
from 1997 until 2002. My wife and I love to
stay in Suzhou”, Mr. Gebhardt noted on his
appointment, adding that the employees and
the management of SEAL can be very proud
of what they have achieved since the foundation of the company 15 years ago. Witnessing the passion of the people of SEAL,
Gebhardt is confident that the company will
achieve every target set in the future.
SSD Adds to its Ranks
Dr. Karl Walter and
Louis Wakatsuki
have joined global
law firm Squire,
Sanders & Dempsey
along with lawyer
Manfred Baumbach. The additions
demonstrate the
continuing commitment to Asia of this
32 office firm.
Louis Wakatsuki, who joined as Counsel, is
one of only two Japanese nationals admitted and practicing as German lawyers in
Frankfurt. His addition positions the firm
among the few in Germany with a deep
understanding of Japan-based companies,
an important resource given Germany and
Japan’s economic relationship. His practice
focuses on Japan-based clients doing business in Germany. He regularly lectures on
legal and cultural challenges for German
companies with interests in Japan and the
challenges that Japan-owned businesses
face in Germany. Mr Wakatsuki follows the
recent addition of Rainer Burkardt to the
firm’s Shanghai office, a veteran German
lawyer with some 11 years advising German and EU companies on their operations
in China.
www.china.ahk.de
Management Engineers on Schaeffler Group Brings Hope to Sichuan
ASEAN
The opening ceremony of the Schaeffler
Management Engineers in association with
VDA conducted a study on the Automotive
Industry in Southeast Asia. Helmut Surges,
Director of Management Engineers reports,
“Manufacturers and suppliers need to differentiate their ASEAN marketing strategies
to meet local needs and to align them to new
developments.” Affordable fuel-efficient vehicles that can be promoted in several countries by state development programmes are
needed, concludes the study.
The European automotive industries need
free trade agreements with the region like
their Japanese competitors. An agreement
allows the Japanese automotive industry to
export their vehicles to the ASEAN region at
much lower tariff rates than those assessed
on European and American competitors.
German manufacturers and suppliers should
study closely whether they wish to participate – with a local presence – in the growth in
the ASEAN automotive region. Many of the
member states are on the brink of the ‘industrial modern age’ with an enormous demand
for all things automotive.
Group Hope School was held on 14 th October 2009 in Rongshan Town, Guangyuan
City in Sichuan Province.
After the destruction through the terrible
earthquake in May 2008, employees of
Schaeffler Group Greater China decided to
help with the reconstruction of the Rongshan School that was seriously damaged in
the catastrophe. A generous donation was
made through the China Youth Development Foundation (CYDF), and the Schaeffler
Group Hope School was erected on the site
of the old building in coordination with the
Rongshan local government. Bright and spa-
cious rooms now welcome the students to a
new semester and a new beginning. Books
on various topics were also donated by
Schaeffler representatives in an act of social
responsibility meant to bring hope and comfort to the families affected by the quake.
WACKER and Dow Begin Second Phase
On 21st October 2009, Wacker Chemie AG
and Dow Corning Corporation started the
construction of the second phase of their pyrogenic silica plant in Zhangjiagang. The pyrogenic silica plant, together with a siloxane
plant, are key facilities of an integrated silicone manufacturing site developed by both
companies at Jiangsu Yangtze River Chemical
Industrial Park. They produce materials used
extensively in construction, beauty and personal care, power and automotives.
Covering an area of one million square meters, the site is China’s largest facility of this
kind and among the world’s largest and most
advanced integrated production complexes
for silicones. The overall nameplate capacity
for both siloxane and pyrogenic silica, including the second phase silica plant, is expected
to be approximately 210,000 tons per year.
Investments from both partners in the new
pyrogenic silica production plant will amount
to a mid double-digit million Euro sum.
19
BUSINESS FOCUS
Panalpina Sets Up Centre
in Wuhan
Panalpina, a leading supplier of forwarding
and logistics services, has announced the
opening of a Centralised Services Centre
(CSC) in Wuhan. With the new set up in
Wuhan the CSC is able to provide a wider
service portfolio to Greater China. The principles of high quality service, transparency
and increasing productivity will remain the
same. It is also the company’s objective to
provide 24/7 services whenever requested.
This will not only cover some requirements
within Greater China but enable the CSC to
potentially offer services to other areas.
Ms. Monika Ribar
GL Signs Contract with
Sinovel
Germanischer Lloyd (GL) has signed a contract on wind turbine measurements with
Chinese SINOVEL Wind Co. Ltd. Services
provided under the deal include load, power
performance and power quality as well as
acoustic noise measurements. The agreement
comprises measurements for three Sinovel
turbines, one of them being erected in the
Shanghai East Sea Bridge’s 100MW Offshore
Wind Farm, China’s first national offshore
wind power demonstrating project.
“In addition to the CSC set up, Panalpina
will strive to open its own operational entity
in Wuhan as to gather to the demands of our
clients and build on the developing direct
transport modes into and out of Wuhan,”
said CEO Monika Ribar. The company plans
to open the centre in the first half of 2010.
Salans Launches new Service
In response to the increased focus in the area
of transfer pricing documentation, Salans
has launched a new service to clients. The
service offers the preparation of all transfer
pricing documentation across all major jurisdictions for client transactions, including clients in Greater China. Salans also launched
the firm’s latest Vox Tax report, which focuses entirely on the issue of transfer pricing
documentation regimes across developed
and emerging markets.
Co-Head of the Global Tax Group Sandra
Hazan says: “The new service offering
addresses the needs of many clients who
previously had to talk to multiple advisers
in multiple jurisdictions and then try and
process all of that information internally
to ensure compliance with a multitude of
requirements.” The full report is available at
Salans’ new-look website.
Bosch Celebrates 100 Years in China
On 15 th October 2009, Bosch held a press
conference in Beijing to mark the 100th anniversary of its first involvement in China. In
October 1909, Bosch introduced its magneto
ignition system into the Chinese market,
which since then has developed to become
one of the most important markets for the
Bosch Group. During the press conference,
Mr. Franz Fehrenbach, Chairman of the
Bosch board of management said: “As we
celebrate 100 years of Bosch in China, we
are encouraged by the market potential for
resource-saving and energy-efficient innovations and will further strengthen our presence in the country.”
Bosch also invited several hundred guests
including government officials, customers
and business partners to attend its centennial gala dinners. Earlier in 2009, Bosch
organised Family Days at its nine major
locations in China and celebrated the 100th
anniversary with all its associates and family
members.
For GL, this mandate is another step in the
Chinese market. Sinovel is one of the leading
Chinese wind turbine manufacturers with
a reported local market share of more than
22%.The contract commenced in September
2009 and is scheduled to be completed by
May 2010. The services will be provided in
joint cooperation by WINDTEST KaiserWilhelm-Koog GmbH - a 100% subsidiary of
GL - and the GL Renewables Asia teams in
Shanghai and Mumbai.
Baden-Württemberg Partners to Move Ahead
Following the invitation of Baden-Württemberg’s government, this year’s joint working
groups for economical and technical cooperation between Baden-Württemberg and its
partner provinces Jiangsu and Liaoning took
place in Tübingen and Freiburg. During these
18th and 19th meetings of the joint working
groups previous projects were reflected upon
positively. Representatives from both sides
agreed on additional steps and future projects
to deepen and strengthen the provincial part-
20
nerships that began over 20 years ago.
Future projects will focus mainly on the field
of business cooperation, such as the business
delegation from Baden-Württemberg visiting
three different cities in China end of October
2009. Other projects will cover education and
training, agriculture, intellectual property,
medical and health care as well as the social
security system. The next meeting of the joint
working groups will be held in autumn 2010
in Jiangsu and Liaoning.
State Secretary Richard Drautz and Deputy
General Secretary Xu Li during the signing of the
joint working group’s protocol.
www.china.ahk.de
Henkel is Top 10 Green Company
Asia Solution at FAKUMA
The Chinese business news magazine
Business Watch assessed and released
the names of the top
50 Green companies
in China that have
demonstrated excellent performance in
leading the trend in
green manufacturing, green energy
and green service.
Henkel, a global
leader in home care,
personal care, and
adhesive technologies, was awarded the Top
10 rank.
As an aspiring global player, Asia Solution
Corporation lives up to its belief that success
comes from a global mindset and industry information. From 13th to 17th October
2009, Asia Solution’s senior executives all
participated in the FAKUMA trade fair in
Friedrichshafen, Germany. The fair deals
with plastic processing and is ranked as one
of the world’s leading forums on plastics.
In association with several business institutions, all manufacturing companies were
assessed in the fields of environmental and
ecological awareness, recycling, technical standard, clean production technology
and sustainable development. “The award
proves our long-term sustainability strategy
right,” said Jan-Dirk Auris, Henkel Asia Pacific President. “We see enormous potential
for innovations that combine performance
and quality with responsibility toward
people and the environment. We want to
position Henkel as a leading sustainability
partner for our industrial customers, retail
trade and consumers alike.”
KÄRCHER Opens Chengdu Branch
In order to provide the best possible service
to its customers in the Southwest of China,
KÄRCHER opened another office on the
mainland, this time in Chengdu, Sichuan
Province.
The KÄRCHER Chengdu office, located
in Room 904, building 26, Shu-du garden,
Chengdu, is the fourth branch of KÄRCHER
China and responsible for managing and
servicing the company’s operations in southwest China including the provinces of Sichuan, Chongqing, Gansu, Shanxi, Xinjiang,
Qinghai, Ningxia, Guizhou and Xizang. The
branch provides the whole range of services
to customers, including demonstrations,
after-sales-service, sales and service training.
New Freudenberg IT Centre in Shanghai
Freudenberg IT extends its Chinese SAP
consulting services by opening the new
Automotive Competence Centre in Shanghai. Mr. Klaus-Peter Wolf will head the new
centre that will deliver automotive specific
SAP solutions as a director. His long term
experience in the international SAP project
business will help to extend FIT’s broad
customer base in the automotive sector and
strengthen the company’s support of the
specific consulting needs of automotive companies in China.
Asia Solution Corporation considered the
fair a good platform to tap into potential
cooperative partner pools and as an opportunity to provide better services in future.
The next international presence of Asia Solution Corporation as an exhibitor will be at
the Chinaplas 2010, to be held 19th-22nd April
2010 at the Shanghai New International
Expo Centre in Pudong.
BIZERBA China Takes on
New Role
Bizerba China was recently announced to
become the Sales, Service and R&D Centre of
Asia for Bizerba Group. Bizerba China was
founded in 2005 originally as a sourcing and
production centre to serve China, as well as
the Bizerba Group with parts sourcing, manufacturing of modules and retail scales. “We
are very much impressed by the tremendous
development in Asia during the last two
years. With the finalised strategic set-up, we
are convinced that we will serve the Asian
Market comprehensively,” commented Mr.
Uwe Hutzler, Head of Region Asia/Pacific.
Besides sourcing and production, Bizerba
China will undertake more business activities, including market research, product
development, technical training and service
supports. “We will bring our know-how and
innovative technology from Germany to
China and work out localised solutions for
specific markets in Asia,” added Mr. Christian Milchers, CTO Asia.
21
BUSINESS FOCUS
MEMBER NEWS SOUTH CHINA
MEMBER NEWS
SOUTH CHINA
Messe Frankfurt Successfully
Organised Asiamold 2009
Guangzhou Guangya Messe Frankfurt
successfully organised the Asiamold 2009.
The fair was declared an international success, having received 10,468 visitors from
38 countries and regions during the threeday fair period. This reflects an increase of
8.4% compared to 2008, which is remarkable
given the current financial crisis.
Regarded as a major gateway for Asian
mold and die makers to enter the international market, the global recession has barely impacted the popularity of Asiamold. In
total, 298 leading brands from 12 countries
and regions flocked to Guangzhou to showcase their latest and most advanced machinery, equipment and products. The third
edition of Asiamold successfully reinforced
its leading position as the top trade exhibition in Southern China for mold-making
and tooling, design and application. Next
fairs to come in South China organised by
Guangzhou Guangya Messe Frankfurt are
Intertextile and SPS Industrial Automation
Fair in March and the International Lighting
Exhibition in June 2010.
InterContinental Shenzhen Welcomes Hugentobler
Mr. Paul Hugentobler has been named the
new General Manager at the InterContinental Shenzhen. A Swiss national and seasoned
hotelier, he brings with him 25 years of experience in the hospitality industry having held
executive positions for several leading hotels.
Mr. Hugentobler has worked as General
Manager at several Hyatt properties including in Hong Kong, Xi’an, Macau and Guangzhou. He has a deep bond with China and
a comprehensive knowledge about Chinese
culture. A graduate from the Ecole Hoteliere de Lausanne, he is also a recipient of
the prestigious Lausanne Hotel Association
Honorary Diploma. Prior to assuming his
new position, Mr. Hugentobler was the General Manager of Grand Hyatt Guangzhou.
On 17th September, Herrenknecht (Guangzhou) Tunnelling Equipment Co. Ltd.
celebrated the opening of the Central Warehouse and Component Workshop in Free
Trade Zone with about 200 employees and
more than 100 guests including customers,
politicians and industry representatives. Mr.
Eberhard Schuppius, Consul General of Germany in Guangzhou, Mr. Gebhard Lehmann
and Mr. Kurt Stiefel, members of the Board
of Management of Herrenknecht AG jointly
conducted the Ribbon-Cutting.
TCA Extends Top Management
Mr. Bryan Roberts has recently joined TCA
Ltd. as the new General Manager. UK-born
Roberts has acquired strong operating experience and skills in the electronics industry,
having previously worked in the industrial,
medical, military, telecom and contract
manufacturing sectors. With his background
in production engineering and strategic
sourcing, he will further demonstrate TCA’s
unique strength in the manufacturing processes and improve sourcing and processing
of complex projects. His initial tasks will be
22
Additional Herrenknecht
Facilities for Tunnelling
Equipment
CEO Frank Jaeger with his new GM Bryan
Roberts (left)
to strengthen and support the management
of the company and to streamline operations
to maintain the high quality standards of
TCA Ltd. in Dongguan.
Herrenknecht (Guangzhou) Tunnelling
Equipment Co. Ltd. was established in 2002
to manufacture the tunnel boring machines
for the Asian market. In 2008, the facility
assembled 12 tunnel boring machines for
metro construction in Guangzhou, Shenzhen
and India. With the completion of the new
plant with a total area of 6,500m2, Herrenknecht endeavours to guarantee the best
service to its costumers on site.
www.china.ahk.de
New GM at Kempinski Shenzhen Cheong Climbs the Ladder at Four Points Shenzhen
Kempinski Hotels,
Europe’s oldest luxury hotel management group, has officially announced the
appointment of Mr.
Torsten Dressler as
General Manager of
its property in Shenzhen. Mr. Dressler
was born in Rostock,
Germany and started his career in the hospitality industry more
than 25 years ago. During his international
career he worked for such prestigious hotel
groups such as Le Méridien and Starwood
Hotels.
Mr. Dressler is a true Kempinski veteran.
He joined the group in 1998 and has since
worked in the the flagship properties in Budapest, Berlin, Heiligendamm and Moscow,
in addition to having successfully opened
the Kempinski Hotel Shenyang. He brings
with him a wealth of operational experience
gained in Europe, Middle East, Africa and
China. Before his appointment to Shenzhen,
Mr. Dressler was leading the pre-opening of
Kempinski Hotel Cathedral Square Vilnius
in Lithuania.
Bryan Cheong has
been appointed
as Hotel Manager
of Four Points by
Sheraton Shenzhen.
Bryan has 22 years
of experience in
gastronomy and
Food & Beverage
leadership from
Malaysia to Singapore, Thailand to
Myanmar and now China. Bryan did seven
international brand hotel openings and has
worked with Starwood for the past 6 years.
In 2004, Bryan joined the pre-opening team
of Four Points by Sheraton Shenzhen, where
he started as Executive Chef and later as the
Director of Food & Beverage. Furthermore
Ms. Cathy Deng has been appointed as the
Rooms Division Director.
TÜV Rheinland Launches Battery Testing and Certification
Services
On 16th September, TÜV Rheinland Group
officially inaugurated its first battery testing centre in China during a grand opening
ceremony in Shenzhen. The event formally
introduced the Group’s one-stop solutions
to Chinese battery manufacturers. Mr. Ralf
Scheller, President of TÜV Rheinland Greater China, Mr. Holger Kunz, Managing Director of TÜV Rheinland South China and
other board members hosted the opening.
High-ranking officials from the Consulate
General of Germany, Shenzhen and Guangdong Inspection and Quarantine Bureaus,
China Certification & Inspection Group,
China Quality Certification Centre, Shenzhen WTO Affairs Centre, as well as representatives of foreign chambers and leading
battery manufacturers were all present at
the launch.
TÜV Rheinland is one of only four BATSO
(Battery Safety Organization) members
worldwide. The testing centre is the only
lab in China that can test and certify compliance with the BATSO Manual for lithium
batteries used in light electric vehicles.
23
BUSINESS FOCUS
COVER STORY
From Exclusive
to All-Inclusive
China’s Secret Growth Engine is
the Service Sector
China is known as the workbench of the world. When
people think of China, they
still see smokestacks and
masses of cheap labor producing the low cost products
the world demands.
Here is an interesting pop quiz, in which you
will most likely emerge victorious: “What is
the fastest growing industry in China?”
The auto industry? Wrong.
The electronics industry? Wrong.
Well, the title of this story gave the punch
line away - China’s fastest growing industry
is the service industry.
In terms of share of GDP, China’s vaunted
manufacturing industry has hovered in the
45% to 50% range from 1978 until today. In
the same period, China’s service industry
exploded from a little more than 20% in
1978 to more than 40% today. Since 2003,
the growth of China’s service sector has
abated and hovered in the 40% territory. The
Chinese government will not sit idle and
wants the service sector to be half of China’s
GDP by 2020 – and China usually gets what
China plans. As far as the world goes, 50%
of GDP is by all means a conservative target.
According to the World Bank, the service
sector’s share of GDP is 64% in high income
countries, 55% in middle income countries
and 43% in low income countries.
China is the world’s third largest economy
since it passed by Germany in 2007, and
likely to overtake Japan as the world’s second largest economy in 2010. Betting on a
growing industry in a large market is one of
the safest bets one can make.
A Service Oriented Country
First timers in China are in for a big surprise:
they witness a service oriented country before they have cleared customs. The border
guards are usually friendly and greet the
traveler with a handbook-mandated smile.
Only in China can you instantly rate your
satisfaction with a border guard at the push
of a button. Say “xie xie” for the smile by
pushing the button on the far left – the one
that says “Greatly satisfied.”
24
© ImagineChina
www.china.ahk.de
Old China hand Jack Perkowski, author of
the book “Managing the Dragon” agrees:
“In the early 1990s, airports were 1950s vintage, and finding yourself on an old Tupolev
plane was not at all unusual on many domestic flights. Today, nearly every major city
in China has a modern airport built within
the last five years, and China boasts one of
the most modern aircraft fleets in the world.
In a post 9/11 environment, travel around
China is in many ways much easier than in
the United States.”
about pixel.de©Sven Schneider
Plenty of slots to fill in China's service sector
Once inside the country, even the most
worldly traveler will miss few services: in
Beijing, he can order practically anything
for home delivery faster than in Manhattan.
Hate to stand in line at the bank? Have your
banker visit you at the office. All it requires
is the proper deposit amount.
Half Full or Half Empty?
At a rate of only 40% of GDP, China keeps a
low profile compared to OECD economies in
terms of its service sector. It is also very low
compared to other countries with China’s
per capita income. Western voices preach
at home that an economy has to produce
something and cannot live from flipping
hamburgers alone.
At the same time, trade envoy after trade
envoy arrives in China with the advice to do
it like the western economies do. In many
parts of the world, service has a share of
70% and more of GDP. In Canada, 3 out of
4 working people provide services. If you
rank the countries of the world by the size
of their service sector in relationship to their
GDP, China lands on place 104. Ethiopia
(43.4%), Nicaragua (57.7%) and -surprise!Cuba (68.4%) are way ahead of China. Once
in China, one doesn’t have to travel far to
find the other extreme: Hong Kong tops the
list with more than 90% of GDP. Mainly due
to its financial services industry, Hong Kong
is the world capital of service.
A Long Term Job Machine
One of the foremost concerns of the Chinese
government is to keep its working masses
gainfully employed. Infrastructure projects
generate employment fast, but result in short
to medium-term employment. The service
sector generates long-term jobs.
Join Our Growing
Network
As countries develop and incomes increase,
people demand better services. Individuals
can afford to travel; companies can afford to
buy design expertise to make their products
better. A large service sector delivers jobs
and supports the continued growth of the
economy.
Entering the Chinese Service Sector
Starting a service company in China is very
easy – unless you are in an area that is still
regulated, such as banking, telecommunications et al. The common way of entry is to
start a Wholly Foreign Owned Enterprise
(WFOE). As the name suggests, this Chinese
enterprise is wholly owned by a foreign entity. You do not need to enter a joint venture
arrangement. With a WFOE, your profits can
be transferred out as long as proper taxes
have been paid. A WFOE needs a foreign
corporation as the investor. What if you are
a private investor who wants to start a Chinese service company? Make a stop in Hong
Kong – start a Hong Kong company (which
can be done in a few days). You can own
the Hong Kong company yourself or with
partners. This Hong Kong company then
becomes the parent of the Chinese WFOE.
Many Chinese companies have a Hong Kong
company behind them.
Surprise: China has a TÜV.
The first wave of service companies landed
on Chinese shores in the wake of large
multinationals investing in China. Having arrived in China, the multinationals
found the place devoid of Western market
research, courier companies or restaurants
that served an original German ham hock.
They encouraged their service providers
to come with them to China. Advertising
agencies, engineering firms and logistics
companies sprouted up where large companies settled. The headquarters back home
requested books to be audited according to
generally accepted accounting principles,
which brought big and small auditing firms
to China. There is more to audit than just
books: production processes for instance.
Take advantage of our
comprehensive, Chinawide
network of German companies. Contact your local
Chamber for details.
Join Today!
Beĳing
Ms. Katja Sassi-Bucsit
010 6539 - 6660
[email protected]
Shanghai
Mr. Jan Höpper
021 5081 - 2266 ext. 1656
[email protected]
South China
Mr. Kilian Becker
020 8755 - 8203
[email protected]
25
BUSINESS FOCUS
COVER STORY
To the surprise of newcomers to China, China has a TÜV. Actually,
China has two TÜVs, both situated in Shanghai, close to the automotive manufacturing hub. There is TÜV Rheinland, and there is TÜV
SÜD. When TÜV SÜD started in China in 1994, “the testing and
certification business was completely closed to foreign companies,
even for export product”, Dirk von Wahl, CEO of TÜV SÜD China
recalls. “Our first job was to sensitise local manufacturers to the
quality expectations of European customers”. Since 1994, TÜV Süd
has worked for more than 10,000 customers in China, and “Tee – U –
Vee” has become a household phrase in the Middle Kingdom.
As rules and regulations replace tariffs, certification is big business
in China. A Chinese manufacturer would be hard pressed to stay
current with all the requirements Brussels sprouts; one needs a good
pilot to navigate these hazardous waters.
This leaves room for smaller entries as DEKRA, or FAKT in Heimertingen near Memmingen – a “boutique TÜV.” Specialising in the
automotive sector only. FAKT quietly established itself a few years
ago in China, and provides certification services mainly for the auto
parts industry. FAKT became price competitive by being one of the
first companies to be accredited to test product using local laboratories or testing equipment available at manufacturers. Xaver Fackler,
CEO of FAKT says: “Testing at the manufacturer’s location can bring
big savings in time and money. It also brings additional know-how
for the manufacturer’s own personnel. If they pay attention, they
learn all the steps we used in our own labs”.
Testing for domestically sold products is still more or less a Chineseonly affair. Von Wahl hopes for “a liberalisation of the certification
market, which gives foreign testing companies access to the domestic market.”
Not for the Faint of Heart
Chinese companies are highly cost-conscious. Robert Fuchs, a German who heads up the UK based advertising agency Vizeum in
China, says: “In Europe, a new client wants to see the creative first.
In China, the first thing a new client wants to know is how much we
charge to make an ad.”
China’s service industry grew from 20% of GDP thirty years ago to
40% today. Looking at the world’s averages, there is a lot of room to
grow. A combination of the world’s third largest economy and the
world’s most populous country makes for very interesting opportunities. For those who want to tackle that market, Robert Fuchs has
some advice: “In China, everything is huge: the market is huge, the
purchase power is huge, the opportunities are huge, the entry costs
Growth Areas in a Growing Sector in
a Growing Country
Here are some ideas for service companies:
n
IT systems, any kind of data services: Data can
be the lifeblood of an industry. Many data services we
take granted in the West do not exist in China. This is a
huge opportunity for those who have the resources to deal
with approximately 1.5 billion people.
n Fast Food: KFC has more than 2000 restaurants in China
and is opening a new one every day.
n
Travel: China has already become the fourth largest inbound tourism market in the world and the largest outbound
travel market in Asia.
n
Financial services: China still is a cash society to a
large degree. As the market gets deregulated, attractive
opportunities beckon.
n
Automotive aftermarket: China has replaced the
USA as the world’s largest new car market. There are rich
opportunities for repair chains as ATU in Germany or Pep
Boys in the USA.
n
Telecom: China has 338 million internet users and more
than 650 mobile phone users. Regulatory barriers need to
be overcome.
n
Training: China soaks up western know-how like a dry
sponge.
n
Medical: There is already considerable “medical tourism”
to China. Demographics favor the medical field.
n
Import: Sound counter-intuitive? As incomes rise, so does
the desire for original foreign goods.
Service for Whom?
1.3 billion people - or probably 1.5 billion, nobody is quite
sure, remember the need for IT infrastructure - look like a ripe
market for a newcomer. A more lucrative market may actually be
found back home: there are numerous companies who want to
do business with China. Produce goods here, sell to here, buy
from here: helping these companies achieve their goals can be
quite lucrative.
Some Harder Service Sells in China
Bertel Schmitt has been in the service sector for all his
professional life. He operated his own advertising agency
on Madison Avenue and in Düsseldorf. An assignment for
Volkswagen brought him to Beijing in 2004, where he helped to
launch the Volkswagen Beijing Center, and stayed. He is the CEO
of Sinamotive, a Hong Kong and Beijing based firm that assists
European companies in sourcing private label auto parts in China.
26
Mere consulting companies that only sell advice usually do
not last long in China. Management consulting companies
that try to peddle their USD 5,000 a day services to Chinese
companies are in for a rough awakening. For a laugh, look for
‘Management consulting firms of China’ in the English version of
Wikipedia.
www.china.ahk.de
27
BUSINESS FOCUS
COVER STORY
From the Upper Crust
to the Rest of Us
China’s luxury market is ignoring the economic crisis, continuing to grow
without signs of slowing. A unique set of conditions is giving rise to
some unexpected opportunities.
Five years ago, a booming economy and growing upper-middle class
had China’s luxury market invading headlines across the world.
Newspapers, magazines and blogs all predicted massive growth.
They may not have been going out on the farthest limb, but now they
can all say they were right. Every high-end industry from cosmetics
to automotive saw increased sales and revenue. The luxury market
in China is growing; and despite a worldwide financial
crisis the growth is continuing. Seeing the market
succeed in what should be the most difficult
of times is attracting plenty of focused investment, but leaving some stones of
opportunity left unturned.
between the price ranges of the middle and upper segment, and
have a lineage and quality up to par with some of their luxury big
brothers. This allows them to appeal to both members of the upper
class who care less about showing off and more about purchasing
a high quality product, as well as middle class customers who are
trying to climb the social ladder. The former is really a niche market,
comprised primarily of managers and well established
workers whose jobs do not require much interaction with other people. It is the latter which
is growing and will eventually drive
this new market.
Sorry, Your Card Has
Above and Below
Surrounding what is classically considered the
l u x u r y m a r k e t , t h e re
are two ‘new’ markets
quickly developing in
China. New not because
they haven’t been seen
before in the world, but
new because they have
been to a certain extent
ignored in the frenzy
that has swept over China in the past few years.
Above the luxury market
is the ‘über’ luxury, already
represented to some extent
by the German Watch maker A.
Lange & Söhne and similar brands.
This level of consumption is purely
for the truly elite of China. While it
would make an interesting study on its own,
the bigger and more accessible potential for German brands lies probably in the ‘second-tier’ segment of
the luxury market.
Defining a New Market
Second-tier luxury does not refer to standard luxury in second-tier
cities, it is simply a market situated directly below the standard luxury brands. Brands that fall into this category are falling somewhere
28
Been Declined
To u n d e r s t a n d w h y
a second-tier brand
would appeal to the
upper crust of the
middle class, we
must first acknowledge the differences
between Eastern and
We s t e r n s p e n d i n g
philosophies. While
credit cards and small
amounts of debt are
considered commonplace
in the West, they are still,
for lack of a better word,
‘foreign’ in China. Debit cards
massively outnumber credit
cards; leading to people buying
only what they can immediately afford. This, combined with an increasingly
well informed Chinese consumer, is expanding this new market. They appreciate and long for the
legacy luxury brands offer, yet they cannot currently afford it. They
will instead look to brands which can offer a taste of this exclusivity
with a slightly more affordable price tag attached.
Shelter from the Giants
Companies trying to make an entrance into this market would nor-
mally have to be wary of competition from the superpowers of the
industry; but this is not the case in China. Because so many of the
first-tier players are still establishing their own image of refinement
and class, they are legitimately unable to diffuse their brand. They
have stayed away so far because they do not wish to risk damaging
their mother brand’s image. This lack of competition from the ‘big
boys’, who are busy showing off, makes entering the second-tier
luxury market now even more enticing. Korean car manufacturer
Hyundai has announced that it will be using China as launch pad
for a new ‘luxury’ line of cars made to compete with its Japanese
rivals. This will not affect the German automotive industry for the
most part, as their car brands are still considered a step above their
Asian counterparts, particularly in terms of status and reliability.
What Hyundai’s move does show however, is that other companies
are noticing the gap between the standard middle class and upper
class selection of products. This gap can also be seen as a parallel to
the gap between the first and second-tier cities of China.
Up-and-Comers
Tier-two cities are where the market for second-tier luxury is going
to grow the most. There are a few reasons for this; the first is the inherent ‘behindness’ of the cities. The education of brands is going on
everywhere in China now with consumers hungry for more information on what will allow them to make a grasp at elegance. Tier-one
cities are quickly becoming overloaded with international brands,
although sales are in no means on the decline. The tier-two cities on
the other hand are only now beginning to learn about the different
companies and what they stand for. This combined with a lack of
super rich that can shop exclusively at high end stores, allow for a
consumer base that is desperate to dive into the world of glamour.
They just want to swim in the shallow end until their incomes allow
them a bit more freedom. Another factor is that people in tier-two
cities tend to travel much less for a number of reasons. This can lead
to increased spending at home, as opposed to consumers in the big
four cities, who may travel to places like Macau and Hong Kong to
do a large chunk of their shopping.
Looking Back, Moving Forward
In 1996, LVMH founded their office in Beijing, the first international
luxury brand to enter the market. The French luxury conglomerate
would not begin retail activities until five years later in 2001 and
now, the group sits comfortably atop the massive sector known as
‘luxury in China’. Perhaps a full five years of research is not needed
as the market is no longer brand new, but the lesson is clear: act early, act smart. Just as in 1996 there was a serious lack of luxury goods
and services being provided in China, a similar shortage is now being seen at the fringes above and below that very market. The way to
profitability has already been lit by the past. Now it is only a matter
of someone taking that torch to walk a new path. DF
The author wishes to thank Mr. Anson Bailey and Mr. Micah
Dortch of KPMG for their expert input and to Ms. Nina Lauterbach
of Gerry Weber for her insights from within a company positioned
in the market. Further information on market and customer
classification was drawn from the newly released book ‘Luxury
China’ (see Books section later in this issue for more details).
29
© laverrne / flickr.com
There is much to be learned from studying the local customs
www.china.ahk.de
BUSINESS FOCUS
COVER STORY
From Workbench
to High Tech
The Changing Face of Business in the
Pearl River Delta
Situated in the direct neighbourhood of the Special Administrative
Regions (SARs) Hong Kong and Macao and functioning as an experimental field for economic reforms, Guangdong has long been
a centre of industrial development. Low labour costs and relaxed
environmental standards attracted especially low value-added light
industries. Textile and apparel, food and beverages, electronics
and communication technology, building material, plant construction and pulp and paper became the key industries of Guangdong.
Nowadays, pharmaceutical, automotive and petro-chemical industries also have a growing importance in Guangdong’s industrial
landscape. Covering 30% of the Chinese export volume and having
achieved double digit GDP growth for 28 years in a row, Guangdong
is China’s economically most powerful province. Accounting for
25% of Foreign Direct Investments into China, Guangdong remains a
dominant player in China’s foreign trade.
German companies are situated in Guangdong. The province’s share
of German companies is comparatively low; only 8% of German
companies in China have production sites or offices in Guangdong.
Main investors among them are Bayer, Bosch, Heidelberg Cement,
Lufthansa Technik, Metro, MTU and Siemens. Some reasons why
German companies have decided not to settle in Guangdong are the
lack of qualified staff, energy supply shortages and the focus on unsustainable low value-added industries.
Responses to the Downturn
Rising production costs and the financial crisis however led to a
drastic slow-down of economic growth. Guangdong’s economy is
focused on exporting goods. It depends on foreign demand and
therefore is vulnerable to economic fluctuation. In the first Quarter of
2009 the GDP of Guangdong only grew by 5.8%, compared to 10.1%
a year earlier. Concerning the export volume for 2009, the Guangdong government is even expecting zero growth.
A barometer for the foreign demand for Chinese products is the China Import and Export Fair, also known as Canton Fair. Held twice a
year the attendance and the deals signed reflect the foreign demand
for Chinese products. Whereas the attendance at the fair in spring
2007 reached a record of 206,749 buyers and the value of signed contracts surpassed USD 38bn, only 165,000 buyers from 209 countries
visited the fair in spring 2009, signing deals worth USD 26.23bn. In
response to the recession, the Canton Fair has opened its gates to the
domestic market in spring 2009. For the first time in its 52 year-old
tradition the organisers invited China’s main department stores and
supermarket chains to attend the trade-matching forum. Until 2008
the Canton Fair was only open to foreign investors. In its October
2009 session, the fair was opened up to the public to battle declining
attendance.
Though Guangdong’s economy suffers from the financial crisis, the
situation of German companies in Guangdong stayed relatively stable. Having a strong focus on the local market, German companies
do not necessarily depend on foreign demand. Currently about 500
30
Canton Fair: the region's business barometer
www.china.ahk.de
Reinventing Itself
Guangdong’s industrial landscape is starting to change. The downturn of export and company closures encouraged the Guangdong
government to implement its plan with even greater force and upgrade the industrial centre in the Pearl River Delta (PRD). To set a
strategy outline, the National Development and Reform Commission
released the ‘Reform and Development Plan of the PRD 2008 – 2020’
in December 2008. The plan aims for an upgrade of the industry in
the PRD from the current low value-added to modern high valueadded technology. Attracting brainpower, promoting R&D projects,
better protecting intellectual property while supporting industrial
patent applications were defined as instruments to transform Guangdong’s label from ‘Made in Guangdong’ to ‘Created in Guangdong’.
The plan furthermore promotes the relocation of low-tech manufacturing companies, which are concentrated in the PRD at the moment. Stricter implementation of labour and environmental regulations shall target on low value-added manufacturers to modernise
their factories or move to other locations. Launching infrastructure
development projects in the western parts of Guangdong and on the
borders to neighbouring provinces aims to support the relocation of
low value-added industries. Guangdong is set to provide economic
advantages especially for international trade by maintaining its role
as a testing ground for economic reforms
MTU's main building and warehouse in Zhuhai
©MTU
Although the plan mainly focuses on the industrial upgrading
through regional and national cooperation, it also offers chances for
German companies. The plan promotes an improvement of Guangdong’s educational and labour environment. This will raise the
availability of qualified staff in the province. It will also create new
industry clusters, especially in high tech and environmental industries, allowing companies to settle in the already developed cities of
the PRD. Further chances for German companies are provided by
the numerous research and development projects announced in the
plan. Initial projects in the field of logistics in cooperation with the
Fraunhofer-Gesellschaft have proven Germany’s competence as a
partner in innovation and R&D. The response to the business travel
programmes of the German Chamber of Commerce l South China
showed that German providers of environmental solutions and technologies are warmly welcomed. Chinese institutes and companies
showed great interest in cooperation with German companies.
An upgrade of Guangdong’s industry yet also bears some new challenges. Stricter implementation of environmental and labour regulations will lead to rising production costs. Still, the labour costs for
German companies will remain comparatively low. The relocation
projects however might influence the German trade more severely,
since important purchasers of producer goods may be forced to
relocate to areas with less developed infrastructure; transportation
costs and time expenditures will rise. Though not an exclusive PRD
problem, German companies will continue to face stronger competition from Chinese companies, taking for example the Chinese solar
industry that is already threatening to overtake Germany.
Heidelberg Cements new plant in Guangzhou
Guangdong is currently still planning its measures for the implementation of the Research and Development Plan. The first effective steps towards the upgrading of the PRD have been made, and
first cooperation agreements with the SARs Hong Kong and Macao
signed. These agreements mainly concern environmental protection
and tourism. Further agreements between the PRD cities and a plan
for the construction of a Hong Kong-Zhuhai-Macao bridge to link
the PRD with the SARs will follow this year and push the transition
of the Pearl River Delta. MA
Since this year also open to local companies
31
BUSINESS FOCUS
MEET THE MEMBER
Jörn Hasenfuß
Company: Shanghai Volkswagen
Automobile Co. Ltd.
Job Title: Deputy Managing Director
and Commercial Executive Director
Year of Foundation: 1984
HQ: Anting, Shanghai
Main Business: Manufacturing of
passenger cars
Number of Employees: Around
17,500
What is your business background?
Prior to assuming my current position at
SVW in January 2009, I worked for 21 years
with Volkswagen Group, successively in
different controlling departments, as a director assistant, global procurement manager,
production purchasing manager at Audi and
for the VW Group. This working experience
from other parts of the group is now helping
my role at SVW. The future development of
SVW, integration of resources both at home
and abroad and the comprehensive enhancement of SVW’s core competitiveness are the
main focus points of my work here.
Tell us a little about Shanghai Volkswagen and its activities in China.
Shanghai Volkswagen (SVW) was the first
car-making joint-venture after China started
the policy of reform and opening to the
outside world. In the joint venture the German and Chinese sides each hold 50% of
the equity. With a production capacity close
to 700,000 units, SVW boasts two production bases at present, one in Shanghai and
the other one in Nanjing, including four car
plants, an engine plant, a technical centre and
a die and tooling centre.
SVW is committed to provide cars that can
satisfy the needs of Chinese customers and
meet international technical standards. At
present SVW products cover the two brands
VW and Skoda, with 13 vehicle models. Besides, SVW has set up more than 800 fourin-one dealerships and authorised service
stations across China, which has made us a
frontrunner and leader in the field of automobile service. As a successful example of
Sino-foreign cooperation since 1978, SVW is
not only a benchmark in China’s automobile
32
industry, but also a showcase for the world
to understand China.
October 15th, 2009 witnessed the 25th anniversary of SVW and the off-line of the 5,000,000th
SVW-made car - a new milestone of our business development and a special gift to New
China’s 60 th founding anniversary and to
the 30th anniversary of China’s reform and
opening-up drive.
Have there been any major shifts in
strategy in the time since you entered
China?
In the past 25 years since its foundation, SVW
has undergone several strategic adjustments:
1. SVW has increased its registered capital
many times from the original RMB 160mn
to the current 11.5bn. Total assets have been
accumulated from RMB 350mn to 32.3bn. In
April 2002, the shareholders signed a contract to extend SVW’s operation by 20 years.
4. Over 25 years of growth, SVW has built
up a complete vehicle development system.
SVW’s R&D work has been gradually integrated into the global development system of
VW AG. Our product strategy has changed
from mere introduction of car models to
introduction of new products, development
technologies and local development of products. So far, SVW has set up a medium-andlong-term vehicle development programme
for both VW and Skoda brands, with a view
to launch 3-4 new models every year.
What are your aims for the future?
We are doing our best to keep the leadership in China’s car-making industry, provide
Chinese customers with safe, quality, energysaving and environmentally friendly products and excellent services, and create values
for the car users, the shareholders, the employees, the society at large and other business partners, by way of honest and efficient
business operation.
Can you give an example of a particular
problem you encountered in your work
here?
At the beginning, cultural differences added
challenges to our communication. Thanks to
the cooperation experience over the past 25
years, SVW has found its own way of solving
such problems. Just as the former German
Chancellor Helmut Kohl once said to the effect that the success of SVW has a representative significance, and the key factor to SVW’s
accomplishment is the joint efforts made by
the Chinese and the German partners. To
some extent, the perfect combination of the
two cultures is one of the major advantages
of SVW.
What are the most valuable things you
have learned from working and living
in China?
2. Reacting to the shift of car consumption in
China from mostly commercial vehicles to
private passenger vehicles, SVW transformed
its mode of business operation and marketing and sales approach in 2004 and focused
its attention to private car users.
China is gradually developing into the largest emerging car market in the world, and I
am fortunate to have the chance to work here
and witness the fast growth of the Chinese
car-making industry. As a carmaker with the
largest production scale and the highest level
of modernisation, SVW will certainly make
more bright achievements in the future, and I
am confident and proud of this.
3. Since the introduction of the Skoda brand
in 2005, SVW realised the strategic shift from
a single brand to a multi-brand operation.
SVW has the complete portfolio of the VW
brand, which includes the Santana, Santana
Vista, Passat classic, Passat Lingyu, Passat
New Lingyu, Polo Jinqing, Polo Jinqu, Cross
Polo, Touran and Lavida. The Skoda brand
has formed a product line-up including the
Superb, Octavia and Fabia models.
Working and living in such a flourishing
environment is the most valuable experience
for me, from which I believe I can benefit for
a long time. The experience I gained includes
how to build trust with people for common
development, and how to cultivate local talents and local leadership in the joint venture.
This experience is very precious to me, and
the above-mentioned factors are key to our
company’s future success.
33
BUSINESS FOCUS
Langfang
©Yang Zhao
Work in
NORTH CHINA
Play in Beijing
get brushed aside in the capital are big fish
in Langfang, negotiating affordable packages
and enjoying a better relationship with local
authorities.
“For a foreigner to come here, not knowing
the place and going through the process of
setting up a company, the full support and
understanding of local authorities is essential,” said Tabone. He said he has been
impressed with the local government and the
development zone management’s willingness
to cooperate, solve problems and listen to
suggested changes and improvements.
During the Olympics, Langfang authorities
instructed 95 companies in the development
zone to shut down due to safety concerns during the games. But when company representatives protested, the local government was
receptive to their concerns and found a way to
allow business in the zone to operate as usual.
Business Friendly Govern- No Slowing Down
ment and an Expressway Tabone, Managing Director of W.E.T. AutoSystems China, visited cities and deHave Put a Small City in motive
Community of Commuters
velopment zones all over China while scopBeijing’s South on the Map ing out locations for a manufacturing plant Langfang’s development zone may be an enin 2002. He’s never questioned the decision clave of international businesses by day, but
of International Investment
to locate in Langfang over investment hot once the work day ends, expat staff and visitLike thousands of Beijing’s business people,
Colin Tabone commutes nearly an hour every morning. He travels from his home in
the capital to his office at German auto parts
manufacturer W.E.T. Automotive Systems.
The difference is, instead of fighting his way
through Beijing’s congestion alongside millions of commuters, Tabone cruises along a
60km stretch of the brand new, lightly-trafficked Beijing–Tianjin–Tanggu Expressway.
He arrives at work in the quiet town of Langfang in less time than it takes many Beijingers
to reach their offices in within the larger city.
Just Far Enough
The prefecture-level city of 763,600 only
sprang up as a midpoint along the BeijingTianjin railway in the late 1800s. Today its
park-lined streets are a clean and orderly contrast to the capital’s chaos and pollution. Tiny
by Chinese standards and unknown to many,
Langfang has drawn several German manufacturing ventures to its state-level Economic
and Technical Development Zone over the
past few years.
These manufacturing companies can easily
receive supplies from the Tianjin port, but
still take advantage of the low cost, skilled
and stable workforce in Langfang. They are
also able to make use of the efficient transportation links to move products on to their intended markets. Meanwhile, its proximity to
Beijing’s Capital International Airport makes
business travel fast and easy.
34
spots like Beijing, Shanghai and Guangzhou,
despite receiving attractive offers from many
other development zones.
Andreas Klingels, Marketing Director of the
German company Wirtgen China Machinery,
says costs at their manufacturing plant in
Langfang are still competitive, even after having nearly doubled over the past five years.
He says costs are a major reason why Wirtgen
decided to purchase another 15,000m2 of land
in Langfang’s development zone to expand
its existing factory.
These logistical advantages explain the village’s appeal for a wide range of international
businesses, especially a growing number of
small and medium-sized automotive supply
companies. ENN Group, a major natural gas
provider and clean energy company with a
rising profile, is also headquartered in Langfang, where it has set up a research facility focused on developing clean energy from coal,
efficient solar panels and algae as a source of
bio fuels.
Supportive Local Government
The supportive attitude of local officials also
receives high marks from international investors. In Beijing’s increasingly expensive
and crowded development zones, some of
the biggest multinational companies in the
world elbow for space and the attention of
local officials. Smaller businesses that might
ing business people high-tail it back to the vibrant social and cultural scene of the capital.
The modern apartments the government has
built in the development zone to lure international residents stand empty, and plans to
build luxury hotels have flopped, suggesting
the village has little chance at attracting an expat community of its own as long as it stands
in the shadow of the capital.
Nearly all expats who work in Langfang opt
to settle in Beijing, considering they can drive
to work in under an hour from the eastern
suburbs and 40 minutes from the east Third
Ring Road. The new Jing-Jin-Tang Expressway is “paradise” compared to Beijing’s
clogged roads, according to Tabone. Expats
with families can easily retain access to Beijing’s international schools and network of
expats while running a business in Langfang.
With such convenient links to the capital and
a strong reputation among foreign companies, Langfang seems to consistently offer the
best of both worlds to more and more international investors.
Ms. Juliana Hanson is a writer-at-large for
China Briefing, a business magazine and
website, which has been produced by
Asia Briefing in China since 1999. Asia
Briefing publishes a wealth of information
about China, India and Vietnam and
cooperates with the Asian foreign direct
investment practice, Dezan Shira &
Associates. * [email protected]
SOUTH CHINA
Qingyuan:
www.china.ahk.de
Moving Up
the Value Chain
Business Conditions in Nor thern
Guangdong are Becoming Attractive,
Especially for Electronics and Automotive Players
In the previous edition of the GC Ticker we began to introduce areas
outside the Pearl River Delta (PRD), focusing on Zhangjiang in the
very west of Guangdong. In this edition we turn North to explore
conditions in the municipality around Qingyuan city. Similar to
other parts outside the vicinity of the highly developed economic
area around the PRD, Qingyuan is attempting to catch up to richer
regions in the area. Development in the PRD has contributed to two
changes in Guangdong: First, the development has acted as a catalyst
transforming the regional economic structure. Secondly, the region’s
income level skyrocketed, contributing significantly to an income gap
in Guangdong. As a result the provincial government is highly interested in re-balancing economic weights. Rising costs have already
led several labour-intensive industries to abandon the PRD and look
for other options. In pursuit of upgrading the province’s industrial
profile, the government has encouraged companies to explore opportunities in other regions, for example, Guangdong’s North.
the Qingyuan Economic Development Zone that is home to both Chinese and foreign investments. Most notably Taiwanese Brain Power,
one of the world’s largest suppliers of memory module PCBs, has set
up a RMB 540mn production facility with over 3,000 employees.
A Famous Tourist Destination
Important Hub for Accessing the Domestic Market
With a population of 4 million people, Qingyuan is the largest prefectural level city in Guangdong. Located in north-central Guangdong, it is only 60km away from Guangzhou and 200km from Hong
Kong. Coming from the northern neigbhouring provinces, where
Qingyuan prefecture boarders Guangxi and Hunan, one notices a
shift in landscape approaching Qingyuan City. Just north of the city
lies a popular tourism destination with mountainous areas and bodies of water reminiscent of a miniature Guilin. The area is also home
to several hot springs and indigenous minorities around Liannan
and Lianshan. The warm climate and extensive farmland make the
area outside the city a key agricultural base in Guangdong. The region is an important regional grain producer and in addition grows
tea, tobacco, sugar cane, as well as special timber. As one comes
closer to Qingyuan, the shift in scenery also coincides with a shift
from an agricultural to a manufacturing landscape.
To further connect the city with the PRD and Guangzhou’s developing automobile industry, Qingyuan has established a new base for
automotive suppliers. Japanese H-One invested RMB 160mn in facilities producing skeleton car parts such as frames, moulds, fixture
and gage in a joint-venture with Q-Hapii Auto Parts. The company
is a first-class supplier of Guangzhou Honda and its components
can be found in the popular Accord and Odyssey vehicles. Whereas
Qingyuan is trying to establish its own industrial structures, it realized the need to attach itself to the more advanced economies around
the PRD. Given its proximity to the area and especially Guangzhou,
this might be a successful bid for further development.
A mere 30km from Guangzhou’s New Baiyun International Airport,
Qingyuan offers convenient air transportation possibilities. As an
entry point to more inward regions Qingyuan is currently connected
to the Beijing-Zhuhai expressway as well as the Beijing-Guangzhou
railway. Further infrastructure projects are under construction or in
planning. The aim is to propel Qingyuan into an important economic
hub, linking the PRD with interior markets. A common indicator for
a positive business outlook and internationalisation is the opening
of a five star Sofitel. When considering business opportunities with
lower costs than in the PRD or other booming coastal areas, Qingyuan may turn out to be an attractive alternative. MZ
From Ceramics to Electronics
While the city has tried to play its competitive card in having a lower
cost base, Qinguan also attempts to attract some more sophisticated
industries. The outskirts are dotted by a notable ceramics industry. Other key industries include copper and aluminum processing
(mainly electric wires and cables), electronics hardware as well as
iron and steel products. Electronic companies are mainly situated in
35
BUSINESS FOCUS
EAST CHINA
On September 2009, the technology group, The Linde Group,
launched its Asia-Pacific research and development centre in Shanghai. The 2,400m² Linde Technology Centre, in the Jinqiao Science
Park in Pudong, is the group’s third R&D centre, adding to its centres
in Munich, Germany and Murray Hill, USA. The centre in China will
explore and develop cutting edge gas application technologies for
customers in the Asia-Pacific region. It is the first such R&D centre in
China to be owned by an industrial gases and engineering company.
The centre is equipped with state-of-art facilities and gas application
equipment, and a demonstration facility for R&D engagements with
customers and industry partners. The centre will, with its counterparts
in Munich and Murray Hill, collaborate in global and local R&D
initiatives through sharing of expertise and technology, training and
capability building in applications development.
A gas application technology presentation on copper wire bonding
interconnection for chip packaging. Electronics packaging is one key
area of focus for Linde’s R&D work in China.
36
Shanghai as the
Linde Set up Its Regional R&D Centre for Asia-Pacific in
Multinational corporations are extending their R&D efforts in C
policies to drive sustainable growth, environmental performance
matured economies. Coupled with greater state support toward
quickly developing into a vital breeding ground for innovation an
China’s R&D spending as a percentage of GDP doubled from 0.69% in
1998 to 1.42% in 2006, two thirds of which was contributed by enterprises. The last two decades saw a spike in foreign multinational corporations setting up R&D centres here. The number of foreign R&D
centres increased from 700 in 2004 to 1,200 in 2008, mostly in telecommunications, IT and manufacturing industries. R&D investments by
foreign companies accounts for about 10% of the total R&D spending
in China.
The R&D agenda heats up as China increasingly looks to support it
own domestic growth by moving from a “Buy Western” to a “Develop
Locally” model. With the largest manufacturing sector and highest
growth rates in all of Asia-Pacific, the size of the market and business
growth potential in China requires a local R&D presence positioning
where the action is. With the speed of development in this region, industries will increasingly seek advanced solutions that are sustainable
with greater emphasis on process efficiencies and product quality.
China’s science and technology talent pool makes it very appealing for
R&D investments. With close to one million scientists and engineers
www.china.ahk.de
Next Innovation Hub?
Shanghai. Will others follow?
China as the Chinese government makes visible changes in its
e and energy efficiency across industries to leap frog ahead of
ds R&D resources and the country’s diverse talent pool, China is
nd technology.
graduating from universities each year, setting up the R&D centre in
China allows multinational organisations easy access to talented and
motivated individuals.
Close to the Heart
Shanghai is today China’s economic hub, and a key centre for commerce in Asia. Surrounding the city, the Yangtze River Delta is the fastest-growing economic region in China, representing about 20% of the
country’s GDP. Linde’s decision to locate its R&D centre in Shanghai
was a calculated one to ensure that it is in close proximity to customers in the large manufacturing bases along the Yangtze River Delta.
In line with industry trends in China today, the Linde Technology
Centre in Shanghai focuses on eco-friendly, sustainable solutions
such as wastewater treatment. It has also on its agenda R&D projects
on coal conversion and carbon capture and sequestration (CCS) in
support of China’s technology advances. In addition, the centre is engaged in refining & chemicals, energy, electronics and pharmaceutical
R&D work. The company today has several on-going joint partnership
projects with leading companies and research institutes in China, including Nanjing Iron and Steel Company (wastewater treatment with
carbon dioxide application), Sinopec Research Institute of Petroleum
Processing (development of heavy-oil deasphalting process), Tsinghua
University (carbon capture technology). It was also involved in the
design of Shanghai’s first hydrogen refuelling station in Anting, and
continues to explore further collaborations.
Some Obstacles Remain
Protection of intellectual property remains a key issue for R&D work.
China’s intellectual property rights law enforcement is still weak compared with the West, especially in the remote regions and multinational corporations are affected the most by counterfeiters. To mitigate
the risk, corporations need to proactively protect themselves; addressing the issue in employment contracts, employee training, customer
contracts, collaboration agreements and patent filing. In recent years,
managements are gaining confidence and experience in protecting
their intellectual property. There has also been improved enforcement
and support from the government.
Dr. Yaping Lu is the Head of the Linde Technology Centre in
Shanghai, and drives Linde’s research and development strategy
for the Asia Pacific region. For further information, please contact
him at: ' 021 6105-9888 | * [email protected]
37

Part 1 - AHK Greater China

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