SOHO, Baidu eyes China’s 1st estate-Internet tie-up

Real estate giant SOHO China is likely to join hands with search engine Baidu Inc to sell homes online, two top executives from the companies suggested on Sunday.

It will be the first major tie-up between a landdeveloper and an Internet company if the partnershipis realized.

Attending a panel discussion at the Boao Forum for Asia in South China’s Hainan province, Zhang Yaqin, president of Baidu, said he and SOHO Chairman Pan Shiyi was discussing the possibility of a partnership to create a new way to selling apartments inChina.

Details of the discussion was unclear but Zhang said it was in a very early stage.

Pan also showed interest in teaming up with Baidu, the world’s largest Chinese-language online search provider.

“China’s fortune totaled 180 trillion yuan ($29 trillion) nowadays and half of the sum was contributed by the real estate industry. A cooperation with the booming Internet sector will help the real estate market to create larger value,” Pan said.

“Huge potential lies in the integration between the two industries.”

SOHO has developed many landmarks in Beijing, including an office-apartment complex in the city’s business district and the space-ship like Galaxy SOHO in one of the most ancient areas of the Chinese capital.

Express delivery sector posts massive growth

China’s express delivery sector is growing six times as fast as GDP, according to an industrial index released by the State Post Bureau (SPB) on Thursday.

In terms of industrial expansion, the sector recorded an average 50.3-percent annual growth during the 2010-2014 period, eclipsing annual economic growth, which came in at 7.4 percent for 2014.

Meanwhile, an index assessing delivery firms’ development from four perspectives — scale of industrial development, service quality, coverage, and development trends — stood at 282.4 in 2014, up 70.8 on 2013.

SPB chief Ma Junsheng said the express delivery sector has maintained robust and healthy development, with services and coverage both improving.

The number of parcels received by express delivery in China last year reached 14 billion, the biggest volume around the world. The sector’s market value hit 204 billion yuan (33 billion U.S. dollars) last year, up 42 percent year on year.

Ma promised earlier that China will help domestic express delivery firms expand overseas this year to support booming cross-border online shopping.

Beijing seeks private funds for metro

Beijing will invite more private funds to invest in major projects in seven fields including metro construction, shanty town reconstruction and environmental protection projects, said a key document released by the municipal government on Tuesday.

The capital government released guidelines to attract private funds to invest in the major fields and listed 136 projects in seven public fields on Tuesday. It is the first time that private funds have been solicited for shanty town reconstruction.

The total investment in these projects is expected to exceed 260 billion yuan, reported Beijing Evening News on Tuesday.

Furthermore, a third company may be set up to manage new metro construction. Currently, the metro system is under the management of two companies. With the quick growth of the metro lines in Beijing, the total mileage is expected to exceed 1,000 kilometers by 2020, one of the longest in the world.

On the condition that the metro system be guaranteed safe and efficient, the municipal government will open the metro system to invite more private parties to invest.

But the opening up to private funds does not mean the government will shoulder fewer responsibilities in supervising these fields, said an anonymous official from the Beijing Municipal Commission of Development and Reform.

The government will play a bigger role in managing the growing funds and facilitate the development of the city, the official said.

Dow Chemical CEO suggests more entrepreneurship in China

U.S. high-tech firm Dow Chemical’s CEO on Tuesday advised China to further encourage entrepreneurship and innovation to climb up the global value chain.

Andrew Liveris told Xinhua that China’s transition from low-end to medium and high manufacturing was the right strategy, but to this end, China needed to make more efforts.

He said the government should put in place the right policies, regulations and standards to encourage entrepreneurial innovation to invest in technology that will allow China to move up the value chain.

“You can’t go from driving a slow car in a slow lane to a fast car in a fast lane without changing lanes,” said Liveris, adding that China should go “crawl, walk, run.”

Although the transition is a gradual process, the senior executive said China must move fast as the world was changing so rapidly.

In his view, China has plenty of “brains” and it should organize the “ecosystem” to encourage them to be entrepreneurial. He said: “this is China’s opportunity.”

“To be entrepreneurial, you have to be taught that there is no boundary to taking a risk as long as you are safe and ethical,” said Liveris.

Dow Chemical expressed willingness to assist China’s transition to an advanced manufacturing economy as it would help its business.

“We are very suited to providing technology answers to environmental protection, food safety, clean water, sustainable urbanization and green technology,” said Liveris.

Amid the current economic slowdown, China is turning to mass entrepreneurship and innovation to boost market vitality.

Premier Li Keqiang said earlier this month that the government will continue to “remove roadblocks and pave the way” for entrepreneurship.

Beijing shuts two more coal-fired power plants


The 66-year-old thermal power plant of Guohua Electric Power Co in Beijing was shut down over the weekend.

Beijing has stepped up its efforts to switch to clean energy after it shut two of the large coal-fired power plants that supply power to the city during the weekend.

Prominent among them is the 66-year-old thermal power plant operated by the State-owned Guohua Electric Power Co, which will be replaced by a gas-fired plant, according to a statement by the Beijing Commission of Development and Reform, the city’s economic planner.

The 400-megawatt plant has been running since 1949 in the east of the capital’s financial district, along Chang’an Avenue, which passes Tian’anmen Square in the heart of the city.

The closure, which will cut coal consumption by at least 1.3 million tons a year, came a day after a 93-year-old thermal power plant run by Beijing Energy Investment Group closed its doors in western Beijing.

There were four major coal-fired power plants in Beijing to provide electricity as well as heating during cold winter. But the capital has charted plans to shut them down completely by 2016 as the city has been frequently clouded by dirty smog. The first plant that was shut was the 50-year-old Gaojing Thermal Power Plant operated by the State-owned China Datang Corp, which was closed in July. The fourth plant – the Huaneng Thermal Power Plant – is expected to be shuttered next year.

By replacing the coal-fired power plants with gas-fired ones, the capital hopes to cut emissions of 10,000 tons of sulfur dioxide, 19,000 tons of nitric oxide and 3,000 tons of dust every year.

He Jiankun, director of the institute of low carbon economy at Tsinghua University, said that the initiative to use more clean energy is a reflection of the government’s resolution to combat air pollution.

“Gradually, all the coal-fired power plants will be phased out in Beijing and replaced by either gas-fired or other clean energy-powered plants,” said He, who is also the vice-chairman of the national experts’ panel on climate change.

“This is a good thing for the development of clean energy, industrial upgrading and innovation on clean technologies in the field of energy,” he said.

In a clean air action plan (2013-2017), the government plans to reduce 13 million tons of coal consumption within five years. By 2014, consumption had been cut by 4.5 million tons. In 2015, the city plans to reduce coal consumption by another 4 million tons and limit the annual coal consumption to 15 million tons.

But He also cautioned that closures of large-scale coal-fired plants may lead to huge overcapacity in coal, steel and cement industries, which have already witnessed heavy losses in recent years.

Coal consumption fell last year for the first time in 14 years, sliding 2.9 percent year-on-year to 3.51 billion tons, according to the National Bureau of Statistics.

Taiwan’s jobless rate drops to near 15-year low

Taiwan’s unemployment dipped to 3.69 percent in February, marking the lowest level for the month in almost 15 years, the island’s statistics authority said Monday.

The rate was 0.02 percentage points lower than that seen in January, according to the statistics agency.

The unemployment rate for the January-February period also hit its lowest level for the same period in almost 14 years.

New jobs for February were mainly created by the service and industry sectors, which added 94,000 and 41,000 new jobs, respectively, for the month.

Hainan expands duty-free program to boost tourism


Tourists select duty-free products in Sanya, South China’s Hainan province, Oct 24, 2012.

The range of imported items available at duty-free shops in Hainan was increased on Friday in a bid to promote the island province as an international tourist destination.

An additional 17 types of product, including baby formulas, coffee and air fresheners, have been added to the duty-free program, taking the total to 38.

The revised program announced by the Ministry of Finance also eases restrictions on the amounts of 10 types of imported items that may be bought.

The change applies to popular categories such as cosmetics, perfumes and watches.

Wang Huiping, deputy director of Hainan’s Department of Finance, said the changes are in response to complaints from some tourists about the limited choice of goods available.

The initial program was launched in April 2011 on a trial basis.

It allowed individual tourists and Hainan residents age 16 or above to enjoy duty exemptions on certain types of imported goods worth no more than 8,000 yuan ($1,283) in total before flying to other destinations on the Chinese mainland.

Hainan residents can only shop at the duty-free outlets once a year, while others can purchase items twice each year.

Figures from the local customs department show that, between the launch of the program and the end of last year, Hainan’s duty-free stores received more than 4.08 million customers who spent a total of 10.9 billion yuan.

The province has two duty-free shops, one in the provincial capital of Haikou and the other in the resort city of Sanya.

A staff member at Sanya said the shop has been stocking up with the new types of goods to ensure there is an adequate supply.

Liu Deqian, a consultant at the Chinese Academy of Social Sciences’ tourism research center, said the changes to the program will make the province more attractive to visitors and help to boost its economy.

“During holidays, many Chinese tourists flock to other countries to go on shopping sprees, and this is mainly because goods sold abroad are much cheaper than the same products sold in China,” Liu said.

“The revised program may change this situation, as the items that have been added are mostly daily necessities that Chinese tourists eagerly buy overseas.”

He said the program has made such goods available in Hainan at attractive prices.

“Since the program caters to both domestic and foreign tourists, it’s possible that someday foreign tourists will flock to Hainan for the shopping,” he added.

Lenovo, Xiaomi to work on Windows phones


China’s Xiaomi Tech’s CEO Lei Jun takes a selfie with his cellphone at 2015 CeBIT Technology Trade fair in Hanover, Germany, on March 16, 2015.

Microsoft said on Wednesday that it will partner Lenovo and Xiaomi to develop smart devices that runs the latest version of its Windows operating system.

The U.S. multinational announced an initiative to deepen cooperation with China’s leading hardware and software makers to promote Windows 10 on computers, tablets and smartphones, during a two-day conference in the southern city of Shenzhen.

Windows 10 is slated for launch sometime this summer.

Lenovo, one of China’s largest smartphone makers and the parent company of Motorola Mobility, will launch Windows-based smartphones this summer, said Tong Fuyao, general manager of Lenovo China.

A separate statement from Microsoft on Wednesday said the Lenovo phone will be a contract device with China Mobile, the country’s largest telecom operator.

Chinese smartphone maker Xiaomi, now the third largest in the world, will provide feedback to Microsoft based on a test run of the operating system on Xiaomi’s flagship smartphone Mi4 later this year.

Windows Phone accounts for a meager 0.4 percent market share in China in the twelve months ending September last year, compared with more than 90 percent share between Google’s Android and Apple’s iOS, according to consultancy Kantar Research.

Microsoft’s push to expand also faces challenges from Chinese players. NASDAQ-listed Alibaba announced in February an investment in smartphone maker Meizu to promote its own mobile operating system Yun OS.

Alibaba introduces ‘Smile to Pay’ at CeBit trade fair

Chinese vice premier Ma Kai and German Chancellor Angela Merkel both attended the opening of CeBIT 2015 in Hannover, Germany, the biggest computer and software fair in the world.

One of the leading tech companies in China, Alibaba, is showcasing a new face scan payment technology called “Smile to Pay” at the fair.

Alibaba’s CEO Jack Ma pulled out his phone, bought an old stamp from Hannover on its e-commerce platform Alibaba.com, scanned his face with the front camera, and said the item had been purchased and was on the way to the Mayor of Hannover’s office.

He also says forgetting one’s password will no longer be a problem if one uses the new face scan technology, which is currently in beta mode testing.

A spokesperson with Alibaba says Smile To Pay will initially be rolled out in China in the near future but there is no fixed date for an official launch.

The Hannover computer and software fair is open till March 20.

China’s free trade zone fever spawns more regional hopefuls

Regional delegates to China’s annual parliamentary session are pushing to have their jurisdictions included into the country’s next batch of free trade zones after three new zones were approved in December. [Special coverage]

The fever to win central government’s approval to upgrade existing development areas or set up new FTZs from scratch has been evident during the annual parliamentary sessions, which closes on Sunday.

One proposal came from Zhang Qingjun, mayor of Hefei, capital of east China’s Anhui Province, who envisions a free trade zone connecting three other provincial capitals along the Yangzte River.

The rationale behind the proposed free trade zone, according to Zhang, is that the four cities situated along the middle of the Yangtze River face similar development challenges and all aspire to attract more foreign investment.

An inter-provincial free trade zone will also help break jurisdictional barriers for China’s central provinces, a move that Zhang says will create a unified market where capital and goods can move with less restrictions.

East China’s Shandong Province also wants to have a FTZ in the coastal city Qingdao, provincial governor Guo Shuqing, also former head of China’s securities watchdog, told Xinhua on the sidelines of the National People’s Congress.

In September 2013, four bonded areas in Shanghai, the country’s financial hub, were bundled together into a free trade zone that authorities billed as a testing ground for financial liberalization, allowing greater foreign participation into the country’s service sector.

The move to set up FTZs is part of China’s effort to allow market forces to play a decisive role in the economy through greater opening to foreign investments into industries and removing restrictions over capital flows.

Yet the FTZ immediately became a coveted notion for local governments looking for a renewed engine to drive economic growth and respond to the central government’s reform rhetoric.

Even before the Shanghai project was officially launched, word spread that southern Guangdong province and the coastal municipality Tianjin were also being considered for the initiatives.

By the end of 2014, Tianjin, eastern Fujian province and Guangdong were selected to be part of the second batch of free trade zones, inheriting practices already proved successful in Shanghai and tapping their unique geographical and industrial advantages for further experiments.

Authorities also expanded the Shanghai FTZ to include the city’s financial district Lujiazui, where a jungle of skyscrapers houses the country’s securities exchanges and leading financial institutions from home and abroad.

The inclusion of Lujiazui is seen as bringing more financial institutions into the game to test how the county’s financial sector handles loosening capital controls and a freely convertible yuan.

Before regional delegates flocked to Beijing this month for the country’s annual parliamentary sessions, local governments in landlocked Shaanxi, Gansu and Henan also unveiled their ambitions to apply for free trade zones at provincial lawmaking sessions.

These announcements have once again fueled speculation that more FTZs will come along, though the central government has not openly endorsed such proposals.

The rush to apply for FTZs is reminiscent of a similar craze over the past two decades to create development zones across the country to attract corporate investment.

Yet analysts cautioned against creating too many FTZs too soon, fearing that the central government’s intention to use FTZs to pioneer more daring reforms will go awry when misinterpreted by local officials as a rebranded excuse to gain more preferential policies.

“A lot of people are still under the misconception that a free trade zone will allow local governments to gain more preferential policies,” said Zong Guoying, a deputy to the National People Congress and Communist Party Secretary of Binhai New Area, a development zone that has ceded much of its land to Tianjin’s FTZ.

Zong said free trade zones should be a “highland for institutional innovations and reforms” — a popular catchphrase increasingly used by officials to refer to policies currently reserved exclusively for free trade zones but must be able to be implemented elsewhere in the country.

At the Shanghai FTZ’s one-year anniversary in September, officials claimed that the zone has pioneered the streamlining of administrative procedures for setting up new companies, eased foreign investment’s entry through a “negative list” approach and promoted cross-border use of Chinese currency.

So far little is known over how the three newly approved FTZs will further Shanghai’s experiments. Authorities have also yet to announce dates for their official launch.

Local officials said during Tianjin’s local parliamentary sessions in January that the city’s FTZ will focus on financial leasing. The Fujian FTZ wants to take advantage of its vicinity to Taiwan to boost cross-Strait trade. Guangdong wants to tap its vicinity with Hong Kong.

The three FTZs, along with the one already in operation in Shanghai, are all scattered along the country’s eastern shorelines, with ports handling a majority of the country’s trade volume and a combined economic output equivalent to one fifth of the country’s total.

“FTZs should be set up in places with economic output big enough for experiments to provide meaningful reference for future reforms around the country,” said Liu Enzhuan, a Tianjin-based economic professor who participated in drafting the plan for the city’s FTZ.

“FTZs definitely have a role to play in growing regional economies, but the whole idea of making investments within a FTZ easier is based on the premise that companies want to invest there in the first place.” Liu said.