No.368 April 10, 2009
Special Issues  
  USITO To Host China's U.S. Purchasing Delegation in SF
 
USITO Issue Paper No.630: WAPI Update
 

In the week of April 20, 2009, China's Ministry of Commerce will send the buying delegation to the U.S. to sign purchase contracts at billions of dollars. USITO has in the past two years partly hosted the buying delegation in the U.S., and this year we will continue our support. On April 24 Friday, USITO will hold an exchange forum and match matching event for the 100-people plus delegation in San Francisco. For more details please contact juliaz@usito.org.

Top Story

China's Top Level Think Tank Takes Shape

Early this week China's major media have all carried the story that China's State Council has just established the nation's top level think tank - China Centre for International Economic Exchanges (CCIEE), which is expected to provide suggestions for the country's top leaders. A Xinhua report says it is regarded as a pioneer for think tanks to transform in China.

CCIEE has received unprecedented government support. Mr. Zeng Peiyan, the Former Vice Premier who just stepped down, was appointed as the Director, which thus makes it the highest level think tank in China. Many well-known economists like Li Yining and current or former high-ranking officials, including President of China Development Bank Chen Yuan, Chairman of China Investment Corporation Lou Jiwei and former central banker Dai Xianglong, were appointed as VPs.

An analytical report in the 21st Century Business Herald stated that the think tank was initiated by Premier Wen Jiabao because he believed it is very difficult for policy makers to make the right judgments just relying on the experience and wisdom of a few people under the current complicated economic situation. Many think tanks have incurred public criticism in recent years for their improper comments and predictions about the economy, one example being that last July, when the oil prices hit a record high last year, many Chinese think tanks believed the price could only be higher. Members please click here for the full text of the analytical report. Xinhuanet.cn, 4/3/2009

USITO Notes: Before the CCIEE took shape, the most powerful (most influential) Chinese think tanks for the government in making industrial policies are those institutions under the National Development and Reform Commission (NDRC). Therefore, those agencies were unavoidably biased in many viewpoints as they had to serve the interests of NDRC as China's top industry regulator. Under this background, the government sees a need for a neutral party to help research and evaluate the policy issues. However, it could remain unknown whether the new think tank will isolate itself from various Chinese interest groups. The head Mr. Zeng was also the former director of NDRC, so some experts doubt his new position could only reinforce NDRC's role as both the top regulator and a leading think tank. In addition, as so many former or incumbent high-level government officials sitting in the board, the CCIEE would have tight connections with the government, thus it is questionable for such an agency to bring forth objective or unbiased views.

China Telecom Officially Kicks Off 3G Business

On April 3, China Telecom, one of China's three telecom carriers, officially began its commercial run of the 3G businesses. It started by offering wireless broadband services in Beijing, and vowed to provide voice services within one or two months.

The first day launch attracted a large crowd in the 60 outlets of China Telecom and the company had to extended the business hours from 6pm to 8pm. China Telecom spokesman said its 3G wireless broadband service is 20 times faster than 2G, and for the time being the company's CDMA2000 wireless network covers 97% of Beijing metropolitan area. Media reports said over 10,000 people had already applied for the service before April 3.

At the current stage China Telecom is running a promotional scheme, to last from April 3 to June 30, whereby it is offering a 3G data card and free Internet access for one month to those subscribers who pay the charges for six months or for one year in advance. This is an effort to attract new subscribers, which according to China Telecom will mostly be young people and those who make frequent business trips. tech.sina.com.cn, 4/3/2008

USITO Notes: China's mobile industry is now injected more dynamics, as the three mobile carriers began competing head to head. The carriers even introduced the so-called "all workforce marketing", which means all staff are responsible for selling their new 3G services and most staff are allocated a "quota" (to sell a number of 3G cards within certain period). At the current stage, the carriers place their promotional emphasis on the Internet access card, and target higher end customers. It is mostly because 3G voice services will continue to be a bottleneck for at least one or two more years, as completing a nationwide 3G network is no easy job whatsoever. So starting from city wise 3G broadband card appears to be a shortcut in making the "3G" notion available first.

Acer Enters Smart Phone Business

Acer, the world's 3rd largest PC maker, announced to launch its mobile smartphones for the first time on China's mainland in an expansion strategy. The company said it has talked with two Chinese mainland mobile carriers about the launch. The firm is focusing on the TD-SCDMA, China's homegrown 3G technology. Detail

Chinese Vice Premier meets Intel chairman

On April 8, Chinese Vice Premier Li Keqiang met with Intel Chairman Craig Barrett. Li reiterated China's stance on opposing trade protectionism and actively participating in international cooperation on addressing international financial crisis. Craig Barrett was here this week to attend the Intel Development Forum 2009. Detail

The Economy May Bottom

A 25 percent rise in car sales and accelerating investment in China indicated the world's third-largest economy was showing signs of improvement, said Fan Gang, who sits on the Chinese central bank's monetary policy advisory committee. Detail

Selected Chinese Media Reports

3G Mobile Communications

India Bans China-Made Cottage Mobile Phones

According to a report in China Business News, the Indian Government just announced to ban the low end mobile phones imported from China. These phones generally do not have legitimate licenses, and are made in China's illegal private factories. They are nicknamed "cottage phones" in China. Chinese Text

TD Subcriber Base to Outnumber 7 Million in 2009

According to a report by Analysys International, in the year 2009, China Mobile may be able to grow its subscriber base to 7 million, from less than one million right now. The growth will mainly be stimulated by the lowering tariff, adjustment of marketing strategies, the huge promotion of TD-card embedded notebooks, etc. Chinese Text

Huawei Confirmed to Produce Android Phones

China's largest telecom vendor Huawei Technologies has confirmed to the media that it will bring to the market mobile phones with Android operating system, which is developed by Google. These products, to be available in the late half of the year, will be made for T-Mobile. Chinese Text

Regulations

MIIT Announces Seven Measures to Hold Back Downturn

On April 8, Ou Xinqian, Vice Minister of MIIT, said that MIIT will introduce seven measures to hold back the growing difficulties faced by China's industries. The measures will include the strengthened implementation of government policies; accelerated industry structure upgrade, fostering small & medium firms, among others. Chinese Text

15 Firms Engage in the Third Round of "Electronic Appliances Going to Countryside"

The Ministry of Commerce just announced the third batch of vendors that are qualified to engage in the "Electronic Appliances Going to Countryside" campaign. Chinese Text

MIIT to Push Legislation of Telecom Law

Li Guobin, Deputy Director General of the Policy and Regulations Department of MIIT, said to the media that Telecom Law is currently a priority with MIIT. Experts commented that the Law is likely to be promulgated soon - within the year the earliest. Chinest Text

 

Innovation

Lenovo Gives Up Expansion Plan in Europe

According to media reports in EU, China's largest PC maker Lenovo has just given up its attempt to build a computer assembly factory in Europe. Chinese Text

IBM: China's Medical Care System Reform Translates to Big Market

Sources from IBM China says that the ongoing Chinese medicare system reform would benefit the software industry greatly. It could probably lead to a new software market of up to USD 1.5 billion, since the system upgrade would require lots of IT support. Chinese Text

Internet

China's Online Ad for Auto Grows Sharply

According to a report by iResearch, China's Internet advertisement market for the auto industry has grow sharply in the past few years. This year the market size will likely reach RMB 1.75 billion (USD 256 million), from last year's RMB 1.38 billion. Chinese Text

Sohu.com CEO: Pirated Online Video Should Be Banned

Charles Zhang, Chairman and CEO of Sohu.com, said to the media that the pirated online video programs pose heavy threat the Internet sector and should be banned. This year his company plans to spend more money to purchase legitimate video programs. Chinese Text

Semiconductor

Semiconductor R&D Branch in Shenzhen to be Encouraged

The Shenzhen Government has just published the "Measures to Promote Semiconductor Illumination Industry in Shenzhen", which states any firms setting up R&D facilities in Shenzhen in this industry is eligible to receive a government fund of up to RMB 5 million. Chinese Text

EU Adjusts RoHS, Impacting Chinese Firms

EU has recently updated its RoHS directive. The new RoHS now covers medical appliances and monitoring equipment, and adds four hazardous substances to be reviewed. Two power supply firms in Guangdong province were reported to retreat their products from the EU market because their failure to meet the new rules. Chinese Text

USITO selected and translated the news summaries above. If you are interested in learning more details about the above Chinese language links, you are welcome to contact us (wenjie@usito.org) to sponsor the translation of that report.

You can also visit this link for the HTML version of this newsletter: http://www.chinatzone.com/weekly/weekly090403.htm

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