Archives 2017

Graduates getting paid better, but still job-hopping

Last year’s graduates of local colleges started in jobs at wages 25 percent higher than their predecessors — more than 6,000 yuan ($886.75) a month.

But still over 21 percent have hopped from their first jobs, said a survey released by the city’s employment promotion center and the students’ affairs center.

The conclusions were based on officially registered information from the 97,000 students graduating from local colleges and who began working in Shanghai in 2016.

The report showed that those graduates’ average term of employment was 29.2 months — 0.4 months longer than their peers graduating in the previous year.

Now, 95.9 percent of the these graduates choosing to work in Shanghai are still employed, 1.2 percentage points more than the survey result in the previous year.

Almost 70 percent of them worked in areas related to what they had learned in colleges, said the report.

About 80 percent of them said they were very satisfied or relatively satisfied with their jobs, while 6.1 percent said they were not quite satisfied or very dissatisfied.

Their average salary one year after graduation was 6,236 yuan per month, up 25 percent from their starting pay.

The average salary for 2015 graduates was 5,659 yuan a month after the same period of working.

The current average pay was 4,645 yuan a month for junior college graduates, 5,495 for those with a bachelor’s degree and 8,972 for those with master’s or higher.

The finance industry still leads the pay level with 8,216 yuan per month, followed by education and health at 7,908 and 7,653 yuan per month respectively.

The proportion of job-hoppers was 2.6 points higher than that of graduates in 2015 during the first year after graduation.

Beijing named best city for entrepreneurship

Beijing was recently named the best mainland Chinese city for entrepreneurship in 2017.

The ranking emphasized the impact of a city’s policies and talents on its entrepreneurship. The main gauge was the enthusiasm of establishing start-ups, government policies and intellectual support.

Report shows that there are five major entrepreneurship regions in China, one of which is the North China region with Beijing and Tianjin at its core.

As the birthplace of the policy of innovation and entrepreneurship, Beijing has demonstrated increasing competitiveness in this aspect. A total of 1,450 Beijing enterprises are listed in the National Equities Exchange and Quotations, roughly equal to the combined total of those in Shanghai (878 enterprises) and Shenzhen (686 enterprises).

Beijing is also home to 174 national innovation and entrepreneurship platforms, still roughly the sum of those in Shanghai (89 platforms) and Shenzhen (86 platforms).

In addition, Beijing continued to relocate non-capital functions in 2016, which will grant more development opportunities to neighboring cities including the newly established Xiongan New Area.

New Beijing Hyundai plant completed in Chongqing

A new Beijing Hyundai plant was completed in southwest China’s Chongqing Municipality Thursday, raising the company’s annual capacity by 22 percent to 1.65 million units.

The plant, the fifth factory of the company, will start operation in August, with an annual production of 300,000 automobiles and 200,000 engines.

Construction of the plant started in June 2015 with a total investment of 7.75 billion yuan (1.15 billion U.S. dollars).

Beijing Hyundai is a joint venture between Beijing Automotive Industry Holding and the Republic of Korea car maker Hyundai Motor.

Chongqing’s auto output continued to take the lead in China, with automakers churning out 3.16 million cars last year, 11 percent of the country’s total.

The output values of the automobile and electronics manufacturing industries climbed 11.7 percent and 17.7 percent respectively in 2016, and the two industries contributed 55 percent to the city’s gross industrial growth last year.

Wanda to sell 13 tourism programs and 76 hotels to Sunac for $9.3 billion

Dalian Wanda Group agreed to sell 13 tourism programs as well as 76 hotels to Tianjin-based property company Sunac China Holding in a deal worth 63.17 billion yuan ($9.3 billion) on Monday, according to a statement Wanda sent to the Global Times the same day.

Sunac will acquire 91 percent of the 13 cultural and tourism programs, including those based in Xishuangbanna, Southwest China’s Yunnan Province, Hefei, capital of East China’s Anhui Province and Harbin, capital of Northeast China’s Heilongjiang Province, after paying 29.58 billion yuan to Wanda, the statement said. The Hong Kong-listed company will then undertake all the loans for developing those programs.

The company also agreed to buy out 76 hotels owned by Wanda, including Wanda Realm Beijing and Wanda Reign Wuhan for 33.6 billion yuan, the statement noted.

The two firms are expected to sign a detailed agreement by July 31 and complete the transfer of payment, assets and shares “as soon as possible”, according to the statement.

After the deals are settled, the transferred cultural and tourism programs will still use the Wanda brand. Wanda is also still responsible for their construction, operation and management.

As of 11:20 a.m., the share price of Dalian Wanda Commercial Properties, the Hong Kong-listed arm of Wanda, has surged to HK$ 1.16 (14.85 cents), almost double the number listed from the opening earlier this morning. The Sunac’s shares were suspended from trading on Monday ahead of the acquisition announcement.

Catering sector takes a bite out of sharing economy

In the restaurant street outside Beijing’s Ritan Park, the day starts slowly, but not for Guo Hongtao, manager of a take-out only restaurant. As online lunch orders begin to pour in, his 20-square-meter kitchen is gearing up for the day. The space is rented from Panda Selected, a start-up that offers co-cooking space to take-out kitchens.

Panda Selected also helps its tenants in a variety of ways, including designing logos, writing menus, planning online operations, connecting them with good suppliers, negotiating with food delivery platforms and applying for business licenses.

As some companies share kitchens with take-out only restaurants, some others share meals. Cengfanqu is one of the apps that bring foodies to household dining tables.

On the other side of the app, home chefs, most of them unemployed housewives living in the countryside, are more than happy to start their own business from home. By benefiting the local rural community, the app has also gained support from the local government.

China’s food takeout market totaled 113.3 billion yuan in 2016, according to business think tank Analysys. The massive market means opportunities for kitchen and meal sharing companies.

At the same time, industry insiders say, kitchen and meal sharing remain a fledgling segment of the market. They note that innovation and regulation are the key factors that could help make it a stable part of the sharing economy.

Multinational firms lose luster among Chinese students: survey

Multinational companies no longer enjoy recruitment advantages in China as domestic IT and Internet companies increasingly gain favor among Chinese students, according to data released Thursday by international consultancy Universum in Shanghai.

The Stockholm, Sweden-headquartered Universum received assessments of 233 employers from 79,346 students majoring in business, engineering, science, social sciences and humanities, law and medicine.

In the survey, 18 percent of Chinese students said they were willing to work for a multinational, a decrease from 25 percent in 2016 and 28 percent in 2015. The proportions were even lower among science and engineering majors—only 16 percent of engineering students and 14 percent of science students wanted to join a multinational after graduation. The students said multinationals were less stable than their domestic counterparts.

This year, the top five most attractive employers for business majors were Alibaba, Huawei, Bank of China, Ernst & Young, and PricewaterhouseCoopers, while the top five most favored by engineering students were Huawei, Tencent, Alibaba, Baidu and Microsoft.

Alibaba and Huawei were also attractive to other majors. Alibaba was the second most attractive employer among science students and the top among students of social sciences and humanities. Huawei took the first spot among science students, and was the second most popular among business students and majors in social sciences and humanities. Tencent also ranked high among various majors.

Chinese Internet companies were well known for competitive compensations that came with highly stressful workloads. But the survey found Chinese students attributed these companies’ attractiveness to their entrepreneurial spirit, creative working environment, team work and corporate social responsibility. The students valued “a sound support for future career development” when it came to choosing an employer.

Wu Gang, the vice-president of Universum’s Asia-Pacific region, said that “In recent years, through our surveys and research, we’ve found an obvious change. That is, China’s indigenous IT and Internet companies are becoming increasingly popular, while the competitive advantages multinationals used to enjoy are no longer that noticeable.”

Investors will be wary of putting money into independent media

Investors will be more cautious in putting money into “content producers” as the industry faces more risks after China’s online regulator recently shut dozens of entertainment social media accounts, industry experts told the Global Times on Monday.

About 30 WeChat accounts mainly covering celebrity scandals have been closed, the Guangdong Province office of the Cyberspace Administration of China (CAC), the Internet and mobile app regulator, said in a notice on Saturday.

Some of the accounts won investors’ attention because of their popularity, but the closure will definitely hurt their investors, Xiong Gang, chairman and founding partner of China ASB Ventures, an investment management company, told the Global Times on Monday.

The Beijing office of the CAC said in a notice on Wednesday that 60 popular celebrity gossip social media accounts were closed in line with the country’s new cybersecurity law, which was effective on June 1.

The closed WeChat accounts include Dushe Movie, a movie criticism app that had more than 2 million followers.

Germany-based Bertelsmann Asia Investments led a series A funding round in Dushe, valuing it at 300 million yuan ($44.13 million), according to a report by financial news portal China Money Network in August 2016.

Xiong warned that investors need to weigh risks before choosing these projects, adding that it’s very important for “content producers” to comply with the law in China.

Xiong said that his company will instead invest in sectors based on technology innovation, which offer relative stability.

There is still potential in the media industry, however.

In 2017, the independent media in China will be more regulated and sites producing high-quality content will more easily get investors’ attention, said a white paper released in February by Beijing-based topklout.com, a research company focusing on independent media.

“We have invested in some projects in the entertainment industry such as video platforms,” Yu Wenhui, founder of the Guangzhou-based investment company Thunderstorm VC, told the Global Times on Monday.

The projects his company invested in are mostly operated on several platforms, not like some accounts that are limited to WeChat, because having only one platform is risky, according to Yu.

Of the accounts that were closed on WeChat, some may seek new channels and opportunities.

“But it costs a lot to regain public attention and attract investors,” Yu noted.

Some experts said that the closures’ impact will be limited.

“Although some of the social media accounts are quite popular, it’s still hard to monetize their estimated value” anyway, said Chang Zongfeng, co-founder of Shanghai-based crowdfunding company baichouhui.com.

Investors will be more cautious as they will need to know whether a site’s content is in line with the country’s cybersecurity law, Chang told the Global Times on Monday.

Beijing’s first private bank set to open

The Beijing office of China’s banking regulator on Tuesday approved the opening of Zhongguancun Bank, the capital’s first private financial institution. It will be the 13th such bank granted permission to operate in the country.

The registered capital of the bank is four billion yuan (590,000 U.S. dollars). The bank has 11 stakeholders, the majority of them being innovative tech enterprises located in the Zhonguancun area of Haidian district, a hub known for tech start-ups.

Private stakeholders

The biggest stakeholder is Yonyou Network Co., Ltd., an enterprise management software and cloud service provider with 100 offices around the world. Yonyou has been listed on the Shanghai Stock Exchange since 2001. The company holds a 29.8% stake in the bank.

According to the Beijing office of the China Banking Regulatory Commission, the bank will serve the needs of SMEs in the technology sector, providing them with support in funding and other financial services, boosting the innovative development of companies in the Zhongguancun area and other Chinese SMEs using technologies such as Big Data and cloud computing.

China promotes private banks

In 2014, China approved a pilot scheme which set up five private banks to give private capital a bigger role in the country’s financial system.

In June last year, the State Council released guidelines aimed at promoting the development of private banks by encouraging and guiding private capital to the banking sector.

The government aims to provide more individualized and convenient financial services to medium-and-small sized companies, rural areas, agriculture and farmers and mass entrepreneurship and innovation.

Sand from Naiman Banner has turned the desert region into an exporting hub with high-tech industrial products

A worker at Naiman Banner Huaxin Silicate Products carries bricks inside the company’s factory.

Sand from Naiman Banner has turned the desert region into an exporting hub with high-tech industrial products

You might have just walked on “magic bricks”.

If you stroll outside Beijing’s National Aquatics Center, also known as the Water Cube, on a rainy day, you will notice something very different.

The water instantly drains through the paving stones, or bricks, before traveling through the drainage system below.

“Our bricks have been used in more than 500 projects in 13 municipalities and provinces,” said Ye Haoqian, general manager of the Inner Mongolia Renchuang Ecology Environmental Protection Industry Co Ltd, which makes the paving stones. “They effectively solve the problems of urban flooding and disperse rainwater.”

Inner Mongolia Renchuang Sand is based in Naiman Banner of Tongliao city in the Inner Mongolia autonomous region.

The high-tech enterprise turns silica sand into a coated substance, widely used in sectors such as oil exploration, construction and casting as well as paving stones.

Naturally, the price increases from about 300 yuan ($44.1) per metric ton for untreated sand to up to 6,000 yuan per ton for the coated product that has liquid-permeability properties.

This allows water to pass through without destroying the bricks or turning them into mush.

“With patented technologies, we are now planning to export our products to the United States, with annual productivity of 600,000 tons of specially-treated industrial sands,” Ren said.

Still, the company is just one of 38 businesses involved in the industry in Naiman Banner.

Around one million tons of sand a year come from the region.

But then, the area is famous for it with the industry employing 2,000 workers, while annually revenue tops 2 billion yuan, according to local government data.

There are numerous grades of products, including building material sand, mechanical precision casting sand and glass making sand.

Since Naiman Banner is located at the heart of the Kolqin “Sand Land” that is hardly surprising. Up to 62 percent of the region is desert and it used to be one of the poorest areas in China.

Every year, villages used to be buried in sand, whipped up by the constant wind forcing residents to move out.

But in the 1980s scientists made an exciting discovery?Naiman Banner was rich in the finest silica sands with reserves of 50 billion tons.

With the building blocks of an industrial-scale production line, the government decided to develop the sector by rolling out the Angnai Sand Mine in 1984.

“Relying on the large reserves of silica sand, local government has developed the industry and turned what many saw as waste into wealth,” said Zhu Zhenmin, deputy director of forestry bureau in Naiman Banner.

So far, there are six industrial parks and three of them are built on sand.

“We do not take over arable land when it comes to industrial development,” Zhu said. “Sand has become a specific character in attracting investment.”

Major Chinese companies, including Renchuang Sand, the largest in the sector, moved there from Beijing.

“By attracting well-known enterprises, we have introduced technologies and solved the problem of financing,” Zhu said.

The central government has also helped to cultivate high-tech businesses by setting up research and development organizations.

Naiman Banner Huaxin Silicate Products Co Ltd has developed 21 new products and obtained 12 patents. It manufactures lime-sand bricks.

“Our annual sales revenue hit 30 million yuan last year with total asset exceeding 60 million yuan,” said Pan Taiyan, general manager of the company.

Lotte to sell loss-making stores

A Lotte Mart in Beijing, Feb 28, 2017.

Lotte Mart, the retail arm of South Korea’s Lotte Group, is expected to sell some of its loss-making stores in China, a South Korean newspaper reported.

But it is finding it hard to sell the stores at a decent price or even find a proper buyer at a time when the hypermarket format is no longer attractive to local consumers.

The South Korean retailer is in negotiations with potential Chinese buyers to sell 20-30 of its loss-making stores. At present, 90 percent of its 74 hypermarkets are no longer in operation, according to Aju Business Daily.

Jason Yu, general manager of Kantar Worldpanel China, said Lotte is seeking buyers for its struggling stores but will keep its profit-making outlets.

“Lotte doesn’t have many advantages. Its best option is to sell its business to local retailers in China, which are likely to be interested in Lotte’s regional presence if they want to boost their dominance in specific regions.”

“It is hard for Lotte to sell at a good price given that the hypermarket business model is struggling for survival and consumers favor smaller formats such as convenience stores and online shopping,” said Yu.

“Lotte’s main problem is it failed to keep pace with the profound changes in China’s retail environment,” said Yu.

According to the Korea Herald, South Korean retail group Shinsegae Group has decided to close its chain of discount supermarkets in China. Shinsegae Vice-Chairman Chung Yong-jin told reporters that the company’s E-mart chain will be leaving the Chinese market after 20 years.

According to a Shinsegae spokesman, the E-mart stores will be closed at the earliest possible date, depending on local contract conditions for each store.

Despite aggressive investment, the chain failed to gain traction and underwent massive restructuring. At the end of 2010, the chain had 26 stores, but it now operates just six.

“Failure to adapt to the changing demands of Chinese consumers and retaining the same business model for years were held as the major reasons for the exit of E-mart in China,” said Yu.

In the first quarter of this year, hypermarkets, supermarkets and convenience stores grew only 0.3 percent, according to Kantar’s report.

Some traditional retailers have met the challenge of change in the nation’s consumer market by improving their offerings in fields such as fresh and imported food, and tie-ups with e-commerce.

For example, Wal-mart Stores Inc moved onto the platform of JD.com Inc on May 25, to make the best use of JD’s massive logistics system and Wal-mart’s global merchandise supply.