Happy New Year everyone. As we move to set our goals for the new year, the following is a couple of goals the Chinese has for their economy in 2012:
1. Increase domestic consumption - With the debt crisis in Europe and the U.S. economy in a slow recovery and the rise in value of the Chinese currency, Chinese exports have been significantly affected. Exports grew by only 13.8% in November, year-on-year, down from the 15.9% growth in October. 2012 is likely to see further decline. Therefore, the government is focused on growing its domestic market, so there is less reliance on exports. Look for growth to the GDP to be at around 8.8% in 2012 with inflation hovering around 3%-4%.
2. Increased foreign acquisitions - Chinese government is actively encouraging its companies to expand overseas. With a huge amount of foreign reserves, Chinese government is looking for ways to buy up assets to lower the holdings. Also, with the global economic downturn, Chinese companies are finding great deals on assets overseas. This "go out" plan also conforms well into Chinese government's plans to shift away from an export focused economy. Recent overseas moves by Chinese state-owned companies include: (a) $2.5 billion deal between China Petrochemical Corp. and Devon Energy Corp. to help develop U.S. shale oil and natural-gas fields; (b) China Telecom's recent move into the U.K. mobile industry; and (c) China Three Gorges Corp. buying 21% in EDP-Energias de Portugal SA for $3.51 billion.
3. Focus on environment - pollution is a huge problem in China. Therefore, the government is taking many measures (from encouraging development of electric vehicles, to the promotion of alternative energy industry, to providing subsidies for the purchase of more energy efficient home appliances). In 2012, you can see more programs aimed at controlling pollution and encouraging environmentally friendly innovations. This is especially apparent in recent Ministry of Commerce guidelines that encourage more foreign investment into energy-saving and environmentally-friendly technologies, new-generation information technology, biotech, high-end equipment manufacturing, alternative energy, advanced materials and alternative fuel cars.
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A Summary of Recent Business News in China
John Tang
Blog Archive
ABOUT ME
- John Tang
- I am the CEO of 1337 Enterprises in Shanghai. My practice focuses on international business transactions and investment consulting. 1337 is a resource that helps small and mid-sized companies navigate the risks and control the costs of doing business in China.
PURPOSE
In my work bridging the gap between China and the West, I often come across current developments in Chinese governmental regulations and business trends. Through this blog, I hope to share those articles that I find interesting and useful with everyone and get everyone's perspective on the topic.
1337 Enterprises
1337 Enterprises, LLC is an Ohio based company established in 2012. Today, with offices in China and the United States, 1337 Enterprises has established itself as a specialized consulting firm helping bridge the distance (cultural and business) between Asia and the Western World.
Over the past several years, efforts have helped businesses (whether large or small) in the U.S., Europe, South East Asia and China. We have key relationships with governmental agencies and local service providers, including consultants (strategy, supply chain, manufacturing, etc.), accountants, legal, insurance, logistics, site selection, marketing/public relations, banking and financing, and trade show support.
Our goal is to use our extensive knowledge and experience and leverage our relationships to provide our clients with smart, efficient and effective solutions and help them establish, grow and expand globally.
Disclaimer
The China Business News Blog is solely the opinion of John Tang Esq. regarding current news events gathered from various sources. John verifies the information posted to the best of his abilities, but can not guarantee the absolute accuracy of the information provided.