Neither Black nor White: Another Perspective on the Chinese Economy

   According to a report from the Wall Street Journal,"when it comes to analyzing China’s economy, nothing is simple. Start with the numbers. Some of them are wrong".

"The most egregious example is the official unemployment rate, which has weathered multiple economic upheavals while barely breaking above 4%. The government’s house-price figures were pilloried by statisticians for understating the true rise in prices thanks to a series of methodological flaws, until the government finally stopped publishing  national data".

Exports earlier this year appeared to be inflated by an epidemic of false invoicing aimed at bringing money into the country, in defiance of China’s capital controls. And many experts think the official economic growth rate, even if broadly right, is “smoothed” over time – its peaks and troughs are less dramatic than the underlying reality. This suits a government that likes nothing more than stability.

Even the Premier, Li Keqiang, has expressed skepticism about the numbers. In 2007, according to a U.S. dispatch disclosed by Wikileaks, he told the then U.S. ambassador that China’s gross domestic product was “for  reference only” – recommending alternative measures like electricity consumption, rail freight and loans as a better gauge of economic growth.

The inadequacy of China’s official data has spawned a booming market in private-sector research that seeks to improve on what the National Bureau of Statistics tells us. HSBC and Market News International both publish monthly Purchasing Managers’ Indexes that compete for investor attention with the government’s measure. Real estate agents Soufun and E-House China produce their own measures of house prices.

There’s also the China Beige Book, created by a private polling organization and modeled on the U.S. Federal Reserve’s regular survey of economic conditions across America. Launched in the first quarter of 2012, the China Beige Book is approaching its second birthday. It is published every quarter, not as often as the Fed’s, but in other ways the idea is the same: a survey of companies and bankers designed to pick up trends on the ground that the top-down macro statistics miss.

The preliminary results from the fourth quarter China Beige Book, released on Thursday, paint a very different picture from the official data. “The strong recovery so confidently declared by most analysts [earlier this year] is in fact a fiction,” said Leland Miller, president of China Beige Book International.

While official figures China’s gross domestic product growth slowing to 7.5% in the second quarter of the year, and then bouncing back to 7.8% in the third, the Beige Book registered few signs of such a rebound.

Most economists expect the final quarter to be weaker than the third. But the Beige Book suggests a modest improvement in the fourth quarter compared with the one before, although momentum is still significantly weaker than it was at the start of the year.

Inventories of unsold goods are up in almost all sectors, according to the Beige Book’s findings, whereas the official PMI has them falling. And while official data suggest China has little to fear from inflation, with the consumer price index rising a tepid 3% in the year to November and factory-gate prices actually falling, the Beige Book registers a rise in both selling and input prices.

The Beige Book’s authors have a counterintuitive interpretation to go with their contrarian data. A slowdown can be seen in a positive light, they say, if it represents the long-awaited rebalancing of China’s industrial dinosaur of an economy toward one that better serves consumers.

Sixty-one per cent of retail firms saw revenue rise in the last three months, the Beige Book says, up a point from the third quarter. In this case, the Book’s findings gel with official data, which show retail sales growing by 13.7% in the year to November.

There are also signs of a geographical rebalancing, with the less-developed inland provinces catching up with more developed coastal areas.

“We consider these results to be potentially bullish,” said Mr. Miller. “A slowing economy is consistent with the rebalancing and restructuring long-promised by the country’s leadership.”

Then there’s the survey’s findings on credit. While bankers said that lending growth was stable, companies themselves said they were cutting back their borrowing. Only 23% said they were borrowed in the quarter, the lowest figure in the history of the poll.

The disturbing conclusion: A higher share of lending is going to roll over old loans to a small group of favored borrowers, while new customers struggle to get credit. Only 14% of bankers polled said that 30% or more of their loans went to new customers, another record low.

Some of the Beige Book’s findings point in a different direction from official statistics, but with the economic picture as murky as Beijing’s sky on a bad day, anything that sheds a little more light is welcome.

The 2014 Jeep Cherokee will feature the EcoTrac Disconnecting All Wheel Drive system

Set to debut in the 2014 Jeep Cherokee, the EcoTrac Disconnecting AWD driveline system is designed to improve fuel efficiency by disengaging components from the driveline when not required, so that only power is delivered to the front wheels.

Back in February we reported  that Jeep was taking a back-to-the-future approach in 2014 with the relaunch of the Cherokee. And while the resurrection of this classic was met with a mixed response from our readers, mostly critical of the same-sameness of the SUV design unveiled, we can now expand on how Jeep hopes to realize “fuel economy improvements of more than 45 percent” claimed at the time. This will in part be achieved by EcoTrac.

Produced by American Axle and Manufacturing (AAM), EcoTrac is billed as "the automotive industry's first disconnecting all-wheel-drive (AWD) system." It improves fuel economy by disengaging rotating parts of the driveline when not in use. According to AAM, the system saves 0.75 hp at 65 mph.

The technology effectively cuts the driveline in half, disconnecting the power transfer unit (PTU) and rear drive module (RDM) when in front-wheel drive mode. This reduces inertia and drag created by the movement of unnecessary components associated with powering the rear wheels.

EcoTrac can either be activated directly by the driver or automatically by the electronic control unit, which kicks-in under conditions such as rain, change in slope or change in temperature. These trigger points can also be customized by the driver.

When the control unit detects AWD is needed, the system engages utilizing a wet clutch in the RDM to bring the rear driveline up to the same speed as the PTU. This is designed to provide a seamless engagement of AWD without any interruption to the driver or vehicle performance. The system reverts back front-wheel drive mode once it senses conditions are suitable.

To date AMM has been granted five US patents for EcoTrac and has another nine pending.

Source: AMM

US Stocks climb to record highs

   U.S. stocks rallied to record highs on Thursday after data showed a bigger-than-expected decline in weekly jobless claims. The Dow Jones Industrial Average DJIA +0.75% rose 122.33 points, or 0.8%, to 16,479.88, marking its 50th record close this year. The S&P 500 index SPX +0.47% gained 8.70 points, or 0.5%, to 1,842.02, posting its 44th record close this year. The Nasdaq Composite indexCOMP +0.28% climbed 11.76 points, or 0.3%, to 4,167.18. 

Source: marketwatch

Indonesian Telkomsel’s Video 500 wants its 100 million feature phone users to stream more videos

While the smartphone business is the sexiest market right now, there’s still lots of money to be made in from people who are still using feature phones. That is what Telkomsel , Indonesia’s largest mobile telco, wants to do with its new premium video service for feature phone users called Video 500. It launched this week.

All of the on-demand video streaming content costs Telkomsel users about IDR 500 (4 cents) plus tax – hence the name of the service. Users can access the videos through Klip.Telkomsel.com.. The videos are showcased based on categories like music, comedy, top buys, and gossip. There’s also information about how long each video runs.

Video 500 can only be accessed by Telkomsel users via 2G or 3G services. Wi-fi connections, as well as Opera Mini and Nokia Xpress browsers, can’t access the site.

The project is run together with Vuclip, whereby both parties will keep on adding videos to the database. Singapore telco SingTel is an investor in both Telkomsel and Vuclip, so it’s not so surprising to see the two of them link up like this.

Is there problem to solve?

Of course, current feature phone users do have access to online videos via sites like YouTube, so why does anyone need Video 500?

The main reason is that a number of feature phones don’t support wi-fi, so each streamed video could end up costing more than IDR 500 (4 cents) for each view over mobile data. Telkomsel’s fixed fee for each video could save users some money.

Out of Telkomsel’s 125 million users, only 16 million of them are smartphone users right now. So there’s still a huge amount of feature phone users to rake more money from.

Indonesian telcos are still rolling out features to monetize from its feature phone users. Feature phone users on the XL Axiata network can une Line stickers via SMS, for example. The country’s top three telcos – Telkomsel, Indosat, and XL Axiata – also offer carrier payment for gaming platform Kotagames.

Source: TECHINASIA

US Code.org: 2 Weeks And 600M+ Lines Of Code Later, 20M Students Have Learned An “Hour Of Code”

Less than a year ago, brothers Hadi Partovi and Ali Partovi launched Code.org to help advocate for computer science in the U.S. and increase participation in STEM education by making these subjects more available in schools and classrooms around the country. Today, it seems that what started as a whisper has grown into a roar.

On December 9, Code.org kicked off a new, nationwide campaign called the “Hour of Code,” which asked teachers across the U.S. to help introduce their students to the basics of computer science through the organization’s coding programs and tutorials. Timed in conjunction with Computer Science Education Week, the campaign has sought to change the perception of Computer Science in the American education system — chief of which is the fact that, today, 9 out of 10 schools in the U.S. do not offer computer science classes.

After months of campaigning and lobbying for change at the state level, in which the Partovis and Code.org have asked states to begin offering programming classes for credit, it seems that their work has begun to pay off — both at the policy level and through the “Hour of Code.” Alabama, Maryland and Wisconsin have announced (or are planning to announce) policy changes at the state level, while both the Chicago Public Schools and the New York City Department of Education have unveiled plans to bring computer science to their classrooms.

What’s more, at the culmination of Computer Science Education Week, the Partovis told us that more than 15 million students had participated in the “Hour of Code,” collectively writing more than 500 million lines of code during the campaign. While Computer Science Education Week came to a close on December 16, the campaign has continued, and the number of students participating has since crossed 20 million, with over 675 million lines of code now in the books.

All told, Hadi Partovi told TechCrunch, more than 20 million students have participated across 170 countries. However, factoring out non-U.S. students and adults, Code.org claims that just about 1 in 4 students in K-12 schools in the U.S. participated in the “Hour of Code.” What’s more, Partovi tells us that “more girls participated in computer science in participating schools in the last two weeks than all students in the history of U.S. public schools combined.”

To break down the “Hour of Code” stats even further, Code.org tells us that, of the 20 million-plus participating, 83 percent were from the U.S., 74 percent were in grades K-12, 51 percent were girls, 8 percent were African-American and 14 percent were Hispanic. While we’d all no doubt like to see these percentages continue to rise and it remains to be seen just how much of a long-term effect one hour of programming can have on students, the “Hour of Code” is off to an impressive start.

As to how the campaign has managed to accomplish this?

The “Hour of Code” has been bolstered by support from a litany of recognizable names. For starters, as we wrote at the outset, both Microsoft and Apple showed their support by hosting an “Hour of Code” at every one of their retail outlets over the course of the week, with Apple advertising its tutorial on its homepage. Google, in turn, kicked off of Computer Science Education Week with a Google Doodle that remembered “Grace Hopper, an American computer scientist and creator of the Cobol programming language” and also linked to “Hour of Code” beneath the doodle.

On top of that, the campaign featured on the home pages of YouTube, MSN, Bing, Yahoo, Disney (and many more), with recognizable names from across politics, music and sports pitching in their support. Among them were “actors and musicians like Shakira, Ashton Kutcher, Angela Bassett and athletes like Chris Bosh, Warren Sapp and Dwight Howard, along with tech leaders like Steve Jobs, Bill Gates, Mark Zuckerberg and Susan Wojcicki.”

Politicians from both sides of the aisle also lent their support, including President Obama and House Majority Leader Eric Cantor, as well as “Senator Cory Booker, Newt Gingrich and Secretary of Education Arnie Duncan.”

To help teachers get their students started in the world of programming, Code.org has curated online tutorials and programs from a bevy of partners, including companies, non-profits and universities. The traffic to some of its partners was so heavy, particularly Khan Academy, that their website was forced offline as ATD reported at the time.

Source: Gizmag

Algae to crude oil: Million-year natural process takes minutes in the lab

Source: Gizmag

Engineers at the US Department of Energy’s Pacific Northwest National Laboratory (PNNL) have created a continuous process that produces useful crude oil minutes after harvested algae is introduced. This new process does not require drying out the algae, which grows in water, saving time and energy that would be otherwise wasted. The final product can be refined into aviation fuel, diesel, or gasoline.

The process mimics some of the conditions that originally turned prehistoric plant material into fossil fuel deep within the earth – high pressures and temperatures.

Algae, an aquatic plant, has long been considered as a biofuel source, but the steps needed to turn a wet, green plant into clear, burnable fuel have been both expensive and time-consuming. The algae had to be processed in a series of steps, one of which involved drying it out and removing all the water, which might be 80 percent of the biomass. Then solvents were used to extract energy-rich hydrocarbons from the dried material.

The PNNL team created a continuous process that starts with the wet algae and subjects the entire mass – water, algae, and all – to high temperatures and pressures, in this case, 350ºC (662ºF) and 3,000 psi.

"It's a bit like using a pressure cooker, only the pressures and temperatures we use are much higher," said Laboratory Fellow Douglas Elliott, the leader of the research team. "In a sense, we are duplicating the process in the earth that converted algae into oil over the course of millions of years. We're just doing it much, much faster."

The products of the process include crude oil, which can be further refined into aviation fuel, gasoline, or diesel fuel (in tests, the process achieved between 50 and 70 percent conversion of the algae’s carbon into fuel); clean water, which can be used to grow more algae; fuel gas, which can be burned to make electricity or cleaned to make natural gas; and nutrients like nitrogen, phosphorus, and potassium – needed for growing algae.

Genifuel Corporation has licensed the process, and has been working with the team at the lab since 2008. The company intends to team with some industrial partners to create a pilot plant using this process to make biofuel in industrial quantities.

How China’s weapon snatchers penetrate American defenses

OAKLAND, California - Agents from Homeland Security sneaked into a tiny office in Oakland’s Chinatown before sunrise on Dec. 4, 2011. They tread carefully, quickly snapping digital pictures so they could put everything back in place. They didn’t want Philip Chaohui He, the businessman who rented the space, to learn they had been there.

Seven months had passed since they’d launched an undercover operation against a suspected Chinese arms-trafficking network - one of scores operating in support of Beijing’s ambitious military expansion into outer space.

The agents had allowed a Colorado manufacturer to ship He a type of technology that China covets but cannot replicate: radiation-hardened microchips. Known as rad-chips, the dime-sized devices are critical for operating satellites, for guiding ballistic missiles, and for protecting military hardware from nuclear and solar radiation.

It was a gamble. This was a chance to take down an entire Chinese smuggling ring. But if He succeeded in trafficking the rad-chips to China, the devices might someday be turned against U.S. sailors, soldiers or pilots, deployed on satellites providing the battlefield eyes and ears for the People’s Liberation Army.

Entering He’s office at 2:30 that December morning, the agents looked inside the FedEx boxes. The microchips were gone. The supervisor on the case, Greg Slavens, recoiled.

“There are a bunch of rad-chips headed to China,” Slavens recalls thinking, “and I’m responsible.’”

1. 
   

In the past 20 years, the United States has spent trillions of dollars to create and deploy the world’s best military technology. It also has enacted laws and regulations aimed at keeping that technology away from potential adversaries such as Iran, North Korea and the nation that poses perhaps the most significant long-term threat to U.S. military supremacy, China.

China’s efforts to obtain U.S. technology have tracked its accelerated defense buildup. The Chinese military budget - second only to America’s - has soared to close to $200 billion. President Xi Jinping is championing a renaissance aimed at China asserting its dominance in the region and beyond. In recent weeks, Beijing has declared control over air space in the contested East China Sea and launched China’s first rover mission to the moon.

IMMEDIATE THREAT

As China rises to challenge the United States as a power in the Pacific, American officials say Beijing is penetrating the U.S. defense industry in ways that not only compromise weapons systems but also enable it to secure some of the best and most dangerous technology. A classified Pentagon advisory-board report this year, for instance, asserted that Chinese hackers had gained access to plans for two dozen U.S. weapons systems, according to the Washington Post.

But the smuggling of technology such as radiation-hardened microchips out of America may present a more immediate challenge to the U.S. military, Reuters has found. If China hacks into a sensitive blueprint, years might pass before a weapon can be manufactured. Ready-made components and weapons systems can be - and are - used immediately.

Beijing says its efforts to modernize its military are above-board. “China has mainly relied on itself for research and development and manufacturing,” the Chinese defense ministry said in a statement to Reuters. “China always complies with relevant laws and cooperation agreements and protects intellectual property rights.”

How often the Chinese succeed at acquiring U.S.-made weaponry or components is unclear. U.S. government officials say they don’t know, in part because the problem is too widespread and difficult to track. By its very definition, black market smuggling is hard to monitor and quantify. Quite often, sensitive U.S. technology is legally shipped to friendly nations and then immediately and illegally reshipped to China.

China also presents a special challenge: It is both the largest destination for legally exported American-made goods outside North America and the most or second-most frequent destination for smuggled U.S. technology. A 2010 classified Pentagon assessment showed a spike in legal shipments to China of “dual-use” technology - products that have civilian and military purposes, a person involved in the study said.

Source: Reuters

Asian Coconuts news site.

Before Byron Perry founded Coconuts, the rapidly growing Asian community news site with one million monthly unique visitors, he was a perpetually bored journalist.

After moving to Los Angeles in 2007 to work as a copy editor at Variety magazine, the American found that the entertainment business wasn’t his calling despite opportunities to attend film premieres and interview celebrities.

Then there was the matter of print publications struggling. Variety saw its print ad revenues drop, and had to lay off 30 percent of its staff – including Perry, who was one of the youngest employees there. He took his severance package and traveled around the world, landing in Southeast Asia and a gig as an English language reporter at the Phnom Penh Post in Cambodia. That didn’t last long.

The job wasn’t boring, but the town was. I rode around in a bicycle covering the latest news in Siem Reap, or a new coffeeshop, or a new construction in town.

He then moved on to cover real estate in Thailand, but again, property wasn’t something he liked. This led to the thought of starting his own news website, since he felt there wasn’t a good urban news website in Bangkok.

Starting in September 2011, Perry bootstrapped Coconuts out of his Bangkok apartment for about a year.

I had to write nearly all the articles myself, with some help from freelancers.

He got some reprieve after receiving funding from angel investors in Silicon Valley. The money gave him a welcomed cushion to focus on readership growth and the business aspects.

Cure for boredom

The closest analogue to Coconuts is perhaps Gothamist, the company best known for its city blogs in places like New York City, Los Angeles, and even Shanghai.

Essentially, Coconuts focuses on hyperlocal news in Southeast Asian cities. While this could, in theory, mean covering events like the opening of a local photocopy shop that have no relevance outside of its immediate vicinity, Perry wants to find unusual happenings that can go viral globally. It does both original articles and content aggregation by scouring for stuff on social networks.

Given its hyperlocal coverage and business model, the site needs to expand rapidly, especially in the early stages. Coconuts wants to be a pioneer of sponsored content in Asia, which differs from advertorials in that publications take full control over content which sponsors pay a sum to be associated with. It’s something that Buzzfeed and Vice magazine have run with and are succeeding.

For the sums to work out, it needs lots of traffic. To do that, it must have boots on the ground in multiple cities to scour for content and capture readers. So, it launched in Manila in November 2012, then expanded to Singapore  in August 2013. One month later, it launched a Hong Kong site. 

By the first quarter of 2014, it aims to expand to Kuala Lumpur, Malaysia and Jakarta, Indonesia. Beyond that, the big cities in India, with sizable English-speaking populations that are still print-oriented, could be attractive targets.

Making new media profitable

Turning from a journalist into an entrepreneur was challenging, and Perry had to focus more on the business aspects of Coconuts than editorial. He also has to grapple with hiring and firing.

Some hires didn’t work out. I had editors that looked good on paper but didn’t turn out great. From that, I’ve learned that it’s important to put someone to the test first if that role you’re hiring for is going to be extremely important.

2014 could be a make-or-break year for Coconuts. With limited angel funding, Perry is turning his eyes towards monetization, and he intends to hire a sales team to help him break even.

While sponsored content is starting to get traction in the United States, it’s still new in Asia, which means Coconuts will have the arduous task of convincing brands about the concept. So far, the company hasone campaign going, and it’s hoping for more in the coming months.

It’s also gone into traditional banner ads and advertorials, and in the near future it could explore a classifieds section which charges for premium placing.

Another area Perry is concerned about is political content, given the differences in political environments in various cities. While Manila generally respects press freedom, Coconuts is aiming to be “110 percent” neutral in Bangkok and avoiding political coverage entirely in Singapore, given the government’s concerns about foreiners influencing local politics.

While unable to comment on his dealings with authorities, Perry says:

I believe in freedom of media and free speech, but I will abide by all legal requirements in every single market.

Coconuts, Coconuts everywhere

Traffic-wise, Coconuts Manila is leading the way, followed by Bangkok and then Singapore. One million uniques in November 2013 is respectable growth for a site with a full-time headcount of 12, considering it only had about 50,000 uniques a month in the first year.

Source: China Daily

Gothamist, the urban city Blog in New York

about gothamist

Gothamist is the first site in the Gothamist LLC network of blogs and is the most popular local blog in New York. Founded in early 2003, Gothamist has been described by The New York Times as a "marvelous, not-to-be-missed Web site" that "reflects everything worth knowing about this city." Forbes described Gothamist as a "sophisticated, deliciously urbane city blog". In 2007, Gothamist won a Rave Award from Wired Magazine and in 2008, Business Week named Gothamist as a top blog in their annual Best of the Web. Gothamist, as well as a number of other sites in the network, also ranked amongst the most informative blogs in an academic study by Carnegie Mellon.

Traffic is currently at 16 million pages per month and growing.

How High Partner Turnover Damages China’s Private Equity Industry

What’s the biggest risk in China private equity investing? Depends who you’re asking. If you ask LPs, the people who provide all the money that PE firms live off, you will often hear a surprising answer: turnover at PE firms. Nowhere else in the PE and VC world do you find so many firms where partners are feuding, quitting or being thrown off the bus.

A partnership at a PE firm was meant to be a long-term fiduciary commitment. In China, it rarely is. The result is billions of dollars of LP money often gets stranded, and possibly wasted. That’s because when a partner leaves, it often creates a bunch of orphaned investments. The departing partner is generally the only solid link between the PE firm and the investee company. Everyone left behind is harmed — the PE firms, the companies they invest in, and the LPs whose money is trapped inside these deals.

As the CEO one of Asia’s largest and most professional LPs told me recently, “Before committing to a new China fund, we spend more of our time trying to figure out how the partners get along than just about anything else. Will they hang on together through the life of the fund? We know from experience how damaging it is when partners fall out, when key people leave. We know turnover can mean we lose everything we’ve invested. And yet, we still often get stung. ”

In my nearly-twenty years in and around the PE and VC industry in the US, Europe and Asia, I’ve never seen anything quite like what happens here in China. A quick look through my Outlook contacts reveals that almost half the PE partners I know working in China have changed firms in the last five years. One reason you don’t see this elsewhere is that partners expect to earn carried interest on the deals they’ve made. If they leave, they forgo this.

Carry is a kind of unvested pay. On paper, it’s often quite sizable, and should represent the majority of a PE partner’s total comp, as well a kind of golden handcuff. The only reason for partners to leave is they believe they won’t get any of this money, either because of failed deals or, more commonly, large doubts that the head partner, the person running the firm, will share the rewards from successful deals.

Most China PE firms are partnerships in name only. There is usually one top dog, usually the founder and rainmaker. This person can unilaterally decide who stays, who goes, who gets carry and who gets a lump of coal. Top Dog tends to treat partners like overpaid, somewhat undeserving hired hands.

So, why have partners at all? Often it’s because LPs insist on it, that they want PE and VC firms in China to be structured like those elsewhere. The business card says “Partner” but the attitude, expectations and level of commitment say “Employee”.

Senior staff (VPs, Managing Directors) also frequently depart. In the US, you don’t often see that much, since these are the people in line to become partners, which is meant to be the crowning achievement of a long successful career in the trenches. They leave because they don’t believe they’ll be promoted, or if they are, that they’ll see any real change in their current status as wage-earners.

At a party celebrating a recent IPO of a PE-backed Chinese company, I ran into the PE guy who led the original investment, did all the heavy lifting. He had since left and joined another firm. He laughed when I asked why he would leave before the IPO, with his old firm certain to earn a big profit on his deal. “I don’t know who will get the carry, but I was sure it wouldn’t include me,” he explained.

Partners jump ship most often because someone is offering a higher salary, a higher guaranteed amount of pay. Their new firm will usually also offer them carry. Both sides will negotiate fiercely over the specific terms, what percent with what hurdle rate. And yet, more often than not, it seems to be a charade.

From day one, the new partners may already thinking about their next career move, how to trade up. Emblematic of this: here in China, when PE partners join a new firm, they almost always refer to it as “joining a new platform”. Note the choice of words: platform, not firm.

The LPs — and I speak to quite a lot of them — acknowledge, of course, that there are other big risks in China, that individual investments or even a whole portfolio turns sour. But, this is a risk inherent in all PE investing everywhere. High partner turnover is not.

Source: Peter Furham, Caijing.com

Chinese Most Industrious and Overworked: Poll

China may be the most industrious nation in the world, according to a recent German survey, but a Chinese labor expert said lax labor rights have created a culture of overworked employees who do not take vacations.

Monster Worldwide, which runs one of the world's largest employment websites of the same name, and GfK, the largest global market research institute in Germany, released a survey on Tuesday that asked workers from eight nations to rate global "industriousness".

About 8,000 participants in Canada, France, Germany, India, the Netherlands, the United Kingdom and the United States were asked which country creates the best ideas or products, how hard-working is a given country's labor force and where in the world is most competitive. The survey did not poll workers in China.

China topped the ranking, followed by Germany and the US. French workers were considered the laziest in the world, according to the survey.

US respondents ranked China second to their own country in industriousness.

"Hardworking and industriousness has been part of the national spirit," said Zhou Haibin, an officer with the International Labour Organization's China and Mongolia Office. The ILO is a United Nations agency.

"China is experiencing a boom in its economy, while the other nations are now in financial crises," he said. "A lot of industries and transactions are shifting to China, that's why Chinese employees are busier than employees in other nations."

"But one factor that should not be neglected is the lack of labor rights in China," he added.

Employees in China work an average of 8.66 hours and spend 0.96 hours in transit each workday, according to a survey jointly conducted in 2012 by Peking University and Zhaopin.com, a Chinese human resources company. The survey covered more than 30,000 respondents in 28 cities.

Under Chinese labor laws and the ILO's global advocacy, employees should work no more than 40 hours a week.

Germans work an average of about 33.5 hours a week, according to a report by German newspaper Handelsblatt Business Daily.

Zhou said Chinese workers are unable to "safeguard their rights for legitimate working hours and annual paid leaves".

He said not all Chinese employers pay for overtime. On rare occasions, an employer will allow an employee to take the day off if he or she had worked eight hours of overtime.

An employee who works at a leading global consultant firm in Shanghai, identified only as Xu, works 12 to 13 hours a day. He said he is never paid for overtime but considers his high monthly salary a justification for the long hours.

Xu said employees at the firm's Chinese office work the longest compared with their European, Australian and US counterparts. "Maybe that's because all the business is centered here," he said.

Under a regulation endorsed by the State Council in 2008, workers can enjoy five days of paid leave a year after working 12 months. People who have worked more than 10 years can have 10 days of paid leave and workers who have worked 20 years or longer get 15 days.

But few employees in China take their annual vacation. To get more Chinese to go on vacations and boost the tourism industry, the Chinese tourism authority issued a guideline in February to provide more legal support to protect workers' rights to a vacation. The aim of the guideline is that by 2020, all employees in China will be entitled to paid annual leaves.

Source: China Daily

China's Zoomlion Acquires German Dry Mortar Producer

The Chinese construction giant is looking into new sources of growth by moving into overseas market, analysts say.

Zoomlion Heavy Industry Science & Technology Co. Ltd, one of China's largest construction machinery makers, said today it has acquired German leading dry mortar producer, M-TEC.

Zoomlion did not disclose details as the deal is still subject to regulatory approvals.

The Chinese construction giant is looking into new sources of growth by moving into overseas market, analysts say, amid an oversupply of construction machinery and products in the domestic market.

"The decision to enter the dry mortar equipment area was made based on considerations of the company's direction during its transformation and upgrading, as well as its future prospect," Zoomlion vice president Chen Xiaofei said yesterday.

The purchase of the Neuenburg-based M-TEC, which is currently a leading company in the area, will help expand Zoomlion's market for more products, and bring in a new growth engine for the company, Chen added.

The two companies have already entered into an agreement, but the delivery of equity is still underway, said He Wenjin, vice president of the company's investment and financing department. He expected the deal to be finished in March.

Zoomlion CEO Zhan Chunxin had said earlier that to expand overseas market via M&As was the way to future for machinery companies in China where the market was already saturated.

Net profit for the Chinese company fell 45.48 percent to 3.795 billion yuan in the first three quarters this year.

Regarding concerns that the purchase could add to Zoomlion's financial strains, Chen said the project may be profitable the first year after it starts production, and all the input costs will be recovered in two to three years.

In 2008, Zoomlion acquired Compagnia Italiana Forme Acciaio SpA (Cifa), the world's third-largest concrete machinery manufacture, for 271 million euros.

Source: Caijing

Tencent to Launch WeChat Television

The so-called WeChat television is expected to connect WeChat with 30 million Internet TV users in China, Tencent said in a statement.

Internet giant Tencent Holdings Ltd has teamed up with Future TV, a subsidiary of China Network Television and television maker Skyworth Group to jointly produce smart televisions integrated with the company's popular mobile messaging application WeChat.

The so-called WeChat television is expected to connect WeChat with 30 million Internet TV users in China, Tencent said in a statement, adding that it would also boost the Internet TV market.

The innovative product will enable users to use their mobile phones as the remote control for their television and check for TV programs on their mobile phones through WeChat. What is more, people are also expected to purchase favorite TV programs through WeChat so that they can watch the same from home.

The move marks Tencent's further attempts to expand in the smart television sector. The company had in September joined hands with Beijing-based online video portal LeTV.com to make and sell smart TV sets.

The landscape of the traditional TV market is expected to alter drastically with more Internet companies moving into the smart television sector, said analysts.

According to data provided by AVC-Brand, a consultancy that specializes in research on home appliances, smart TV penetration in China is expected to soar from 27 percent in 2012 to 89 percent by 2015.

Source: China Daily

Alibaba Spinoff Moves Further into the Cloud

A division of the e-commerce giant readies to take on US competition.

E-commerce conglomerate Alibaba Group Holding Ltd will extend its cloud-computing services to overseas markets in March, as it attempts to grab a share of the public cloud arena from archrivals such as Amazon.com Inc and Microsoft Corp.

Aliyun, Alibaba's spinoff cloud-computing division, is scheduled to set up data centers outside China to provide cloud-computing services to local enterprises and Chinese companies' overseas operations, the company announced on Tuesday.

By building platforms for companies to manage and store data in the cloud, Aliyun will become the first Chinese company to reach out to the foreign public cloud segment, days after its US counterpart Amazon announced the launch of a similar services in China.

"After five years of development and three years of commercialization, Aliyun is able to provide sustainable services to customers, backed by its resourceful parent, Alibaba," said Aliyun director Zhang Jing.

The service recently gained the world's first gold certification for cloud security from the British Standards Institute, a business standards company, which further guarantees its reliability, Zhang noted.

Zhang declined to disclose the first destination for Aliyun's global outreach. But he implied two options: the United States (Amazon's birthplace) or Southeast Asia, thanks to its proximity to domestic businesses.

As the country's largest cloud-computing platform, Aliyun provides cloud computing services for hundreds of thousands of Chinese websites and e-commerce vendors, banks, game developers and others.

Three-fourths of the 188 million orders generated from the Nov 11 online sales day were processed by the Alibaba cloud-computing system.

Alibaba has made a consistent push into domestic cloud- computing enterprises. In September, Alibaba acquired personal cloud storage service Kanbox.

In August, ChinaSoft International Ltd announced a strategic agreement with Aliyun and the Lishui municipal government for a State-funded cloud project in Zhejiang province.

Aliyun may team up with local telecom carriers to avoid local regulatory restrictions, Zhang noted.

Source: China Daily

China: M&As Expected to Surge in 2014

Despite predictions of an upturn by many, the global mergers and acquisitions market reached an eight-year low in 2013, even dipping below the post-dot.com doldrums levels of 13 years ago, falling by a further 6.2 percent from 2012.

The decline came in spite of a flurry of noteworthy deals, many of them cross-border M&As. The United States-based wireless carrier Verizon Communications Inc bought back Vodafone Group Plc's equity stake in the company for $130 billion, the third-largest corporate deal in history.

Also noteworthy were some of the M&A forays into foreign markets by China's ever-expanding, acquisitive companies. In August, Chinese conglomerate Dalian Wanda Group Corp Ltd paid 300 million pounds ($490 million) for a 92 percent stake in British luxury yacht-maker Sunseeker International, a brand that rivals the likes of Aston Martin for its James Bond film placement notoriety.

Just before Dalian Wanda's cross-border takeover announcement, in May, China's biggest meat processor, Shuanghui International Holdings Ltd, bid successfully for US pork processing giant Smithfield Foods Inc.

Shuanghui's takeover, valued at $7.1 billion, represents China's largest cross-border deal since China National Off-shore Oil Corp bought Canadian oil and gas producer Nexen Inc for $15.1 billion in 2012.

It would appear, however, that corporate leaders' reticence towards mega-merger deals in 2013 will not persist during 2014. An increase in global M&A activity of between 10 and 15 percent is widely predicted, with corporate leaders far more comfortable toward debt financing of takeover deals.

Much of this optimistic upturn for global M&A activity is based on the belief that cross-border deals will rise during 2014 and that much of this will be driven by Chinese companies' gobbling up famous foreign brands.

China Shouguan Mining Corp, a giant in China's rapidly expanding gold-mining industry, is definitely one to watch for further M&A deals in 2014. Demand for gold in China is soaring, and Shouguan's management has stated publicly that it will continue to expand aggressively via M&A deals in 2014.

China's gold-mining industry players were involved in a record $2.2 billion in takeovers during 2013. Expect Shouguan and some of China's other major mining corporations to look further afield and bid for foreign competitors during 2014.

Of course, growth in the technology sector will doubtless drive much of the anticipated 2014 M&A activity, and Lenovo Group Ltd, China's dominant personal computer player, is highly likely to seek to expand its global footprint during the coming year.

Lenovo has recently been linked with well-known technology companies BlackBerry Ltd and HTC Corp, both loss-making enterprises.

We can certainly expect Lenovo to continue its growth via acquisition strategy in 2014, which began in 2005 with the takeover of IBM Corp's PC business and brand name.

Lenovo's management has repeatedly stated the company's determination to become China's first truly global brand with a strong presence in the US, European and Asian markets.

Ailing HTC may prove a takeover target too ripe to pass up.

Other likely contenders for mega-merger deals in 2014 include China's current crop of companies with an international footprint such as Huawei Technologies Co Ltd, ZTE Corp, Haier Group and Li-Ning Co Ltd.

To date, Haier and Huawei have pursued global expansion via organic growth and have not succeeded at or even appeared to have considered mega-takeovers. Huawei, with 70 percent of its sales outside mainland China, is unlikely to change course. The same is true of Haier.

Li-Ning, on the other hand, has not enjoyed the international success achieved by other leading Chinese corporate brands. Its global expansion desires remain undiminished. Growth via M&A may feature more prominently in its global strategy plans for 2014. Rumors have abounded for a while about a possible takeover of Peak Sports, but there's been far less over acquisition of any major global rival.

Nike Inc and Adidas AG remain too strong, but major second-tier competitors, such as the US-based New Balance Athletic Shoe Inc, are well within Li-Ning's takeover radar. New Balance has a history in mainland China that should make any post-acquisition integration of the company and its brand name relatively straightforward. Do not be surprised if, around spring 2014, Li-Ning announces the successful completion of just such a deal.

While any significant global economic recovery remains at best patchy, Chinese companies will seize any opportunity to expand internationally via cross-border M&A. Sluggish economic growth forecasts for 2014, therefore, should lead to a bumper M&A year.

Chinese companies' global expansion is inevitable, and cross-border M&A of famous foreign companies and their brands offers by far the most attractive route. Expect more M&A excitement during 2014.

Source: China Daily

China: Netease to Sell Wealth Management Product

Following Baidu's Baifa, NetEase's first wealth management product, Tianjin, will be sold starting Dec 25 on that platform.

NetEase, a leading Hangzhou-based Internet technology company, officially launched a new investment product online platform Thursday, the Beijing News reported on Dec 19.

Following Baidu's Baifa, NetEase's first wealth management product, Tianjin, will be sold starting Dec 25 on that platform.

Tianjin will be launched in collaboration with Xianjinbao, a money market fund managed by China Universal Asset Management. Currently, the seven-day annualized yield of Xianjinbao is 5.97 percent.

The annual yield of Tianjin was not disclosed. However, NetEase offered "five percent" discount for users who buy the product. Taking the annualized yield of Xianjinbao into consideration, returns of Tianjin may exceed 10 percent.

When starting to sell the product on December 25, NetEase will limit the sale of Tianjin, but the specific quantity has not been disclosed. More than 100,000 people had opened accounts on Tianjin as of 5:00 pm on Dec 18.

It's not the first time that NetEase marched toward the Internet finance. Previously, NetEase Insurance cooperated with Guohua Life and Sun Life Everbright Life in universal life insurance products.

Source: China Daily

Land Sales in Major Chinese Cities See Historic High This Year

Analysts hold bullish outlook as developers go on spending spree.

Land sales in major cities hit a record high in 2013, with the transaction amount in four top-tier cities exceeding 500 billion yuan ($82 billion), rising roughly 150 percent from 2012, latest figures show.

Beijing, Shanghai, Guangzhou and Shenzhen sold a combined 501.5 billion yuan worth of land this year as of Dec 20. Shanghai alone has auctioned off 217.8 billion yuan worth of land, data compiled by property agency Centaline show.

The Chinese property market also saw a boom, as land got more valuable during what has been red-hot bidding among developers with deep pockets.

A plot of land in Shanghai's downtown Xujiahui area was sold for 21.77 billion yuan in September, becoming the nation's most valuable land site since 2010.

In the same month, a residential land parcel located off Beijing's East Third Ring Road was bought by Sunac China Holdings Ltd for 73,100 yuan per square meter of buildable space, becoming the nation's most expensive land in square meter terms.

Major developers are taking the lead in the land purchase spree. The top 10 developers, including China Vanke Co Ltd, Poly Real Estate Group Co Ltd and Evergrande Real Estate Group, have stockpiled 312 billion yuan worth of new land plots so far this year (as of Dec 19), surging nearly 90 percent from the whole of 2012, according to Centaline data.

According to Chen, some local governments are increasing or planning to increase land supply to tame soaring home prices.

"For instance, the Shanghai municipal government announced in November it would increase its land supply for housing construction by 30 percent - 1,000 hectares - this year on the basis of the average annual supply of the last five years," Chen said.

However, Chen said, only about 40 percent of new land supply will be developed into residential projects. The remainder will be used for industrial or commercial properties.

"The new central government leadership has recognized the fundamental solution to controlling the skyrocketing home prices is to increase the supply rather than restrict demand," added Chen.

Zhang Hongwei, research director of Shanghai-based property consultancy ToSpur, believes the land supply boom is laying the groundwork for long-term property policies, such as a property tax.

"Of course, a better-off macroeconomic background will be very important," added Zhang.

New home prices in the nation's 100 major cities averaged 10,758 yuan per sq m in November, rising for 18 consecutive months in month-on-month terms, a report from the China Index Academy, a research arm of Soufun, China's largest property website, showed.

Among the 10 biggest cities, Shanghai saw the highest property inflation at 1.83 percent in November from October, trailed by Nanjing in Jiangsu province, Guangzhou, the capital of Guangdong, Hangzhou, the capital of Zhejiang, and Tianjin, one of the four municipalities of China, all of which posted a month-on-month rise between 1.5 percent and 1.8 percent.

On a yearly basis, new home prices of the 10 largest cities grew 16.56 percent in November, extending the rising streak to 13 months and pointing to robust housing demand in these top-tier cities.

Source: China Daily