Archives October 2007

Hong Kong struggles to halt exodus

By Paul Wiseman, USA TODAY

HONG KONG — Americans and other Westerners have been leaving Hong Kong by the thousands, raising questions about the city’s future as the commercial gateway to China and Southeast Asia.
Since the end of 1997 — the year the former British colony returned to Chinese rule — the number of Americans living here has dropped by 7,680, or 21%, to 28,320. Other nationalities have departed in even greater numbers, although a change in the way the statistics are calculated may explain some of the decline.

For almost two centuries, Western firms have used Hong Kong as a base for doing business in China, taking advantage of first-rate infrastructure, world-class banks and even-handed, transparent courts. But China’s booming economy is drawing firms directly to the mainland.

“China is sucking in a lot of expatriate talent,” says Mike Bekins, managing director for executive recruiter Korn/Ferry International in Hong Kong. Multinational companies “are moving to Shanghai lock, stock and barrel.”

“The benefits of being directly in the China market are overriding the benefits of Hong Kong’s history,” says Laurie Underwood, who interviewed foreign executives in China for her book China CEO.

Other factors:

•Multinational firms are hiring locals for top jobs. “The local talent has improved greatly,” Bekins says. “All companies would rather put a local person in a key role. The locals are here for the long term.”

They also bring Chinese-language skills and don’t require compensation packages that include housing allowances and tuition for kids at expensive international schools, Bekins says.

•Hong Kong’s smoggy skies are making it tougher for the city to attract foreign executives. Thirty-five percent of Hong Kong businesses reported having trouble getting employees to move to Hong Kong “as a direct result of the city’s air pollution,” according to a 2006 survey by recruiting firm Hudson.

The American Chamber of Commerce in Hong Kong has warned that “a deteriorating environment will erode Hong Kong’s edge over competing Asian cities.” Super-clean Singapore, in particular, has been gaining from Hong Kong’s reputation for pollution, says Brenda Wilson, business leader of human capital for Mercer, Hong Kong.

•Dual citizenships might make the exodus look bigger than it is. Under a Chinese law in effect here since 1997, ethnic Chinese born in Hong Kong or the mainland are officially counted as “Chinese,” even if they hold passports from other countries and were once counted as foreigners.

Other evidence suggests that the drop in Westerners might not be so big. International schools are packed — though that partly reflects rising demand among locals for English-language education, says Peter Craughwell, spokesman for the English Schools Foundation.

InvestHK, a government agency that promotes foreign investment in Hong Kong, says the number of U.S. companies with regional headquarters in Hong Kong has risen steadily — from 256 in 2004 to 262 in 2005 and 295 in 2006.

Still, the perception remains among some foreigners that the city’s fortunes have peaked. When Underwood finished her Chinese-language studies five years ago, she didn’t even consider looking for work in Hong Kong. “I just wanted to skip it,” she says.

Underwood moved to Shanghai and works as director of external communications at the China Europe International Business School there. “It seemed like (Hong Kong) was over,” she says. “I wanted to work in the China market, not the Hong Kong market.”

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China Automotive Promotes Wu to CEO

China Automotive Systems Promotes Co-Founder and COO Wu to CEO; Promotes Li to CFO
September 25, 2007: 11:55 AM EST

NEW YORK (Associated Press) – China Automotive Systems Inc., a supplier of power steering components and systems, said Tuesday it promoted co-founder and Chief Operating Officer Qizhou Wu to chief executive.

Wu, 42, succeeds Hanlin Chen, who will continue to serve as chairman.

The company also promoted Jie Li from corporate secretary to chief financial officer. Li, 38, takes over as CFO from Daming Hu, who is now chief accounting officer.

Both positions are effective immediately.

Shares of China Automotive Systems gained 35 cents, or 4.3 percent, to $8.50 in midday trading. The stock has traded in a range of $5.72 to $13.39 over the past 52 weeks.

Microsoft Appoints COO For Greater China Region

October 11, 2007
Microsoft (MSFT) has, for the first time, set a chief operating officer position for the Microsoft Greater China region and appointed Eugenio Beaufrand as its first COO.

Eugenio Beaufrand is responsible for sales, marketing and service and focuses on improving clients’ and partners’ satisfaction. As a top manager of the company, he is also responsible for providing support to the main clients of Microsoft in the region.

As COO, Beaufrand will be responsible for overseeing sales, marketing, and services operations in the market. His responsibilities will include a strong focus on driving customer and partner satisfaction as well as providing support to Microsoft’s major clients in the region.

Eugenio Beaufrand will report to Zhang Yaqin, chief executive officer of Microsoft Greater China region.

A seasoned, 23-year veteran of Microsoft, Beaufrand most recently held the position of vice president, Microsoft Latin America, where he led the region to four highly successful years of unprecedented growth. Beaufrand is a native of Maracaibo, Venezuela and has a Bachelor of Science in Business Administration and Economics from the Lewis and Clark College in the United States.

Sino Fibre Communications Appoints Ben Yan As COO

Sino Fibre Communications Corp. (SFBE.OB) revealed that it named Ben Yan as Chief Operating Officer.
Yan has been working on developing the Company’s North American business development and is now prepared to take a more active role in its overall achievement particularly as it relates to the build out of our service offering in China.

In addition, Sino Fibre Chairman, President & CEO, Matthew Mecke has announced his intent to focus on his role as Chairman of the company and relinquish his titles of President & CEO as soon as a new CEO can assume this roll. Mecke would continue to focus on U.S. Investments, Shareholders, and related Company activity.

CHINA: China Organic Agriculture appoints CEO

One of China’s leading producers of organic rice China Organic Agriculture has appointed Zhidong Li as its CEO.

In a statement, the company said that Li has held positions as CEO, COO and marketing director, as well as investment banker, fund manager and asset manager. At age 27, he was the youngest fund manager for Alliance e-Finance in Australia, managing hundreds of millions of dollars in investments, the company said.

“We are very excited about welcoming Mr. Li to China Organic and we believe his unique mix of experience and expertise will assist us during this high-growth period of our company’s development,” said Huizhi Xiao, chairman of China Organic Agriculture. “I believe that his insightful leadership will serve every member of the China Organic team and ultimately enable us to reach ever higher levels of shareholder value. His decision-making and business tactics will benefit the Company greatly by allowing us to explore new business opportunities to expand our operations.”

China Education Resources Appoints Danny Chi Tak Hon As CFO

10/17/2007 2:46:40 PM China Education Resources Inc. (CHN.V, CHNUF.PK ) announced that it has appointed Danny Chi Tak Hon as Chief Financial Officer.

Hon joined CER from his current position as Partner of Hon & Wong, Certified General Accountants.

Hon was Chief Financial Officer of Silvercorp Metals from October 2004 to August 2006 and Chief Financial Officer of Jinshan Gold Mines Inc. from March 2003 to October 2003.

Big American Names Join Chinese Company

NEW YORK (AP) — The Chinese news and broadcast company Xinhua Finance Media Ltd. added two big names in American media to its board, appointed two other new directors and named a new internal auditor Thursday.

Larry Kramer, founder and former CEO of MarketWatch, a financial news Web site now owned by Dow Jones & Co., and Steve Richards, chief operating officer of Silver Pictures, which has produced such movies as “V for Vendetta” and the “Matrix” series, are the two newest Americans on the publicly held company’s board.

The announcement came a day after Beijing-based Xinhua said The Yucaipa Cos., the southern California investment firm controlled by billionaire Ron Burkle, had taken a stake of undisclosed size in Xinhua. David Olson, a partner in Yucaipa, which counts former President Bill Clinton among its advisers, also will join Xinhua’s board, the company said Wednesday.

The two other directors appointed Thursday are Li Shantong, former director general of the Department of Development Strategy and Regional Economy at the Development Research Center of China’s State Council, and Teddy Liu Weidong, head of Xinhua Finance Media’s advertising group.

Xinhua Finance Media said the changes were intended to “enhance … corporate governance.”

Its chief finance officer resigned in May at the same time Barron’s reported that it had failed to disclose information in its initial public offering documents about disciplinary action taken against a brokerage firm that the former CFO ran.

Independent directors now hold a 7 to 5 majority on Xinhua Finance Media’s 12-person board. The company’s new internal auditor is Henry Heung-Ming Wong.

Xinhua Finance Media, a business publisher and broadcaster, is a subsidiary of Xinhua Finance Ltd., a Chinese financial information and media company led by American-born Fredy Bush.

Xinhua Finance Media’s shares soared Wednesday following news of the Yucaipa investment but slipped back 23 cents, or 2.6 percent to close at $8.55 on Thursday. They are still well below their $13 price at their initial public offering in March.

China 3C Group Appoints New Chief Financial Officer

ZHEJIANG PROVINCE, China, Oct. 8 /PRNewswire-FirstCall/ — China 3C Group , a retailer and distributor of consumer and business products in China, announced today the appointment of Weidong Huang as chief financial officer.

Huang, the newly appointed CFO commented, “I am extremely pleased to have been appointed to this role. I understand the importance of good communication to investors and giving investors the information they need to evaluate our company. I look forward to meeting with more investors.”

China 3C CEO Zhenggang Wang said, “We are extremely pleased to appoint Weidong Huang as our new CFO. He understands the nuances of our industry as well the importance of communicating effectively with investors. With his previous experience as a General Manager of an investment consulting company, he understands the importance of good communication with investors and he is prepared him to work with the financial community. He will be a major asset for us as we continue to grow our company.”

China 3C expects the appointment of the new CFO to have no effect on previously issued guidance and to have no effect on the ability of the company to report third quarter results on time.

About China 3C

China 3C Group is a leading retail chain operating retail outlets in Eastern China. The company specializes in selling 3C products (communication, information technology and digital) in China. Among China 3C’s primary attributes is its efficient distribution network and rapid logistics system. The company’s goal is to become the number one retailer of 3C products in China. For more information, visit http://www.china3cgroup.com.

A profile for investors can be accessed at http://www.hawkassociates.com/chcgprofile.aspx. For investor relations information regarding China 3C, contact Frank Hawkins or Ken AuYeung, Hawk Associates, at (305) 451-1888, e-mail: info@hawkassociates.com. An online investor kit including press releases, current price quotes, stock charts and other valuable information for investors may be found at http://www.hawkassociates.com and http://www.americanmicrocaps.com. To receive free e-mail notification of future releases for China 3C, sign up at http://www.hawkassociates.com/email.aspx.

Forward-looking Statements:

Certain of the statements set forth in this press release constitute “Forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. We have included and from time to time may make in our public filings, press releases or other public statements, certain forward-looking statements, including, without limitation, those under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7. In some cases these statements are identifiable through the use of words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “project,” “target,” “can,” “could,” “may,” “should,” “will,” “would” or words or expressions of similar meaning. You are cautioned not to place undue reliance on these forward- looking statements. In addition, our management may make forward-looking statements to analysts, investors, representatives of the media and others. These forward- looking statements are not historical facts and represent only our beliefs regarding future events, many of which, by their nature, are inherently uncertain and beyond our control. There can be no assurance that such forward- looking statements will prove to be accurate and China 3C Group undertakes no obligation to update any forward-looking statements or to announce revisions to any of the forward-looking statements.

Chinese Bank Searches Abroad for New Talent

In an unusual move, a major Chinese investment bank is starting an aggressive recruitment campaign in the U.S.

Traditionally, Chinese financial institutions had no trouble staffing up at home. Now, however — amid a spate of major Chinese-company IPOs both at home and abroad, and increased cross-border deal-making — the banks are looking to bring in more international experience.

Earlier this month, China International Capital Corp. kicked off its U.S. headhunting trip in New York at a Ritz-Carlton hotel near Wall Street. More than 100 professionals, mostly overseas Chinese, were invited. Senior CICC executives touted opportunities represented by China’s booming capital markets.

Ding Wei, head of the investment-banking division, said the firm is looking to hire about 200 people by year end, expanding the team to 1,000. “We are looking for all kinds of talent” in risk management, product design, structured finance and even administrative posts, he said.

The CICC recruiting team next plans to head to the Wharton School of the University of Pennsylvania and other business schools in the U.S.

In the past, CICC has been famously low key. Set up in 1995 as a joint venture between China Construction Bank Corp. and Morgan Stanley’s Morgan Stanley International Inc., it was China’s first foreign-funded investment bank. The purpose was to set up a government-backed firm that could learn from the top-tier Wall Street firms and provide a template for future Chinese investment banks.

Mr. Ding said CICC estimates this year’s revenue to be $600 million to $700 million, growing from 2006’s $450 million.

Five Practical Strategies for Building a Chinese Workforce

There is a severe shortage of senior managers in China.

By Jorge Perez Izquierdo

China is characterized by rapid change and economic growth. Yet, this massive country with a population of 1.3 billion has a perplexing shortage of talented people that threatens the future growth of foreign and domestic companies.

According to the latest Manpower Employment Outlook Survey released in September 2007, hiring intentions in China fell to the lowest level in more than a year. Shortages are the most severe among senior managers. The 2006 Manpower Talent Shortage Survey indicates a greater need for managers and executives in China than in other countries.

Multinational corporations have a distinct advantage in competing for talent in China, as nearly 75% of Chinese employees would prefer to work for wholly owned foreign companies rather than joint venture companies or wholly owned Chinese companies, according to Manpower research.

Successfully working in China requires using special human resources techniques and practices, which stem from understanding the unique Chinese culture and values as well as the country’s working practices.

Based on our experience in China, Manpower has developed a Workforce Optimization Model, which consists of five practical strategies for successful employee attraction and retention.

Create a learning organization. Quite simply, teach employees something new every day. This may include giving employees projects that go beyond their current job responsibilities. Learning is a priority for Chinese employees because they are acutely aware of the limitations of their educational system and anxious to acquire marketable skills.

Appoint competent leaders. Key skills for managers are coaching and communication. This is because managers in China are highly respected authority figures that must be able to clearly explain company strategies while linking employees’ personal goals to business objectives. Chinese employees also respond best to hands-on leadership and appreciate having a role model to demonstrate what is expected of them.

Build an appropriate organization and culture. It is critical for companies to appreciate and respect cultural norms and practices. These include encouraging a simple management structure and articulating the company’s values. To provide credibility, managers must live and breathe the company’s values.

Provide competitive compensation and benefits packages. The tight supply of managers in China means frequent salary reviews may be needed to keep up with the market rate. But while salary is important, it’s not the only factor. Companies may want to consider offering other benefits such as tuition reimbursement, housing allowances, insurance and long-term incentive plans.

Select the right people. Employers need to anticipate what they’ll require of employees in the future to ensure that job descriptions are realistic. Employers that are open, honest and patient with candidates during interviews are more likely to find employees that share their values. Given the rapid change in China, skills such as adaptability are just as important as experience for most roles.

The potential rewards are tremendous for foreign-owned companies that develop an employment strategy that fits the culture and values. This is because the preference of Chinese workers to join a foreign company may also spill over into preferences for products and services made by those companies. Companies that can turn cultural differences into a help rather than a hindrance have the potential to enjoy boundless growth.