No.370 April 24, 2009
Special Issues  
  USITO/AmCham Breakfast Series Featuring Adam Rak of Symantec
 
English Version of China ICT Stimulus Plan
 

USITO and AmCham-China's IT/Telecom Forum are pleased to invite you to our ongoing breakfast briefing featuring Mr. Adam Rak, Senior Director for Public Affairs at Symantec. During the meeting Mr. Rak will brief you the latest developments in online threats and the challenges that governments worldwide face in tackling those dangers. The event will be held in the Capital Club on April 30. Please register with ftzhang@usito.org to attend the event.
Top Story

MOFCOM: China to Fight Protectionism

Yi Xiaozhun, Vice-Minister of the Ministry of Commerce (MOFCOM), said in an event last week that China has become a major victim of trade protectionism, and he called for synergy among the nations to fight against protectionism. According to him, China is one of the most affected victims of restrictive trade measures, since in the past year up to 40% of anti-dumping investigations and 70% of countervailing investigations globally are targeting Chinese products. He worried that rotectionism could only continue in the period of economic crisis.

Mr. Yi stated that China holds a clear-cut position against any form of trade protectionism, and the country will never practice any forms of protectionism. He called on WTO members to push ahead with the Doha Round of talks, which he expected to help rebuild confidence and restrain trade protectionism. He quoted sources that 17 members of the G20 have resorted to protective trade methods since last November. While global trade is likely to plunge 9% this year, the nations should collaborate more instead of adopting protective measures. xinhuanet.com, 4/19/2009

USITO Notes: Despite the goodwill, USITO remains deeply concerned about the de facto protectionism in China, mostly driven by local governments or enforced via industry-specific institutional measures. As reported in our last weekly edtion, a new circular was newly announced on April 10th, calling for "purchasing domestic products whenver possible"(members click to download English version).

We can feel that MOFCOM as China's pro-trade authority has been inclined to create a level playing field for all market players, regardless of nationality or origins. However, the lack of harmony amongst the government institutions was always a bottleneck for MOFCOM's anti-protectionism initiative, as the ministry itself acknowledges. In the past years MOFCOM has played a greatly helpful role in coordinating other technology authorities in deferring the mandatory enforcement of domestic ICT standards/products in areas such as wireless LAN and encryption. Unfortunately most of such deferred issues resurfaced recently, which again posed challenges to pro-trade authorities such as MOFCOM.

Boao Forum 2009 Hosts Internet Panel

The Boao Forum for Asia (BFA) Annual Conference 2009 was held in the Boao town of Hainan from April 17 to 19. According to organizers, the event attracted more than 1,600 politicians, business people and scholars and focused on the financial crisis. The event, beginning from 2001, was regarded as a top-level economic event in China, and aimed at promoting the development goals of Asian countries through greater regional economic integration.

This year the event set a special section to discuss the Internet industry, themed as " "Another Winter for Internet? – Driving Growth Through Innovation". The panel featured several China's leading Internet figures from government to industry, such as MIIT vice minister Xi Guohua, Google China President Kaifu Lee, and Netease Chairman James Ding. The panelists gave positive views for China's Internet sector, such as it will benefit from China's innovation drive that will pump energy into other fields and in turn accelerate economic recovery. people.com.cn, 4/19/2009

USITO Notes: "Next-Generation Internet" is listed as one of the few key sectors to be encouraged in the next three years, as announced by the Chinese authorities in its newly released ICT stimulus plan (member download). The government has vowed to support the Internet industry by injecting more state investment, credit support and export tax rebates.

China's Internet population has risen to 316 million, far ahead of that in any other country. The Internet is a determinant factor for a number of other industries, such as 3G, which just rolled out in China. Some sub-sectors, such as online game and e-commerce, have kept a robust growth in the past years (over 50%) and saw no sign of stagnancy. All these factors spell out the enhanced government recognition on the Internet industry.

Member in the News: Cisco to launch "Cultivated Innovation Model" in China

Cisco Systems said on 4/17 Friday that it will allocate USD 1 billion to support its newly unveiled "Cultivated Innovation Model" to boost local innovation in China, as part of its USD16 billion investment commitment in the country. Detail

The Mainland Buying Degelation to Visit Taiwan

A Chinese mainland autonomous region will send a large buying group to Taiwan in May, which is expected to purchase USD160 million of products, said local officials. Detail

Stimulus Plans Pave the Way for Full Recovery

China's economic stimulus package is already paying off, and positive changes have taken place in the economy. Chinese officials are facing the challenge of maintaining the growth rate while transforming the economy, but the country has seen good investment numbers and a solid increase in consumption, which would make up for the drop in exports. Detail

Selected Chinese Media Reports

Regulations

MIIT: China To Formulate Infosec Standards

Zhou Baoyuan, Director-General of MIIT's Information Security Coordination Department, said in the 10th China Infosec Conference that his department will accelerate the formulation of China's information security standards, since the country is increasingly intimidated by the spreading Internet backdoors, viruses, trojan, among other threats. He reviewed the 2008 information security work in 2008 by stating that generally speaking the past year was a successful one in ensuring information security. Chinese Text

Regulator: Press Industry Should Broaden Financing

Liu Binjie, the minister of General Administration of Press and Publication (GAPP), told a TV talk show program that Chinese media should now focus on setting a new financing model, which is key to the ongoing reform in the industry. He encouraged the country's major media to largely broaden its financing channels, in order to achieve a more prosperous development. He called for all major media to collect social capitals by getting listed on the stock market, or cooperating with some state-owned enterprises. Chinese Text

3G Mobile Communications

The First CDMA+WAPI Mobile Phone Debuts

According to a report in China Business News, China's first CDMA+WAPI mobile phone has been made available by Hai'er, and China Telecom will officially launch the product on April 22. A few other similar models at CDMA+WAPI dual-mode technology will be launched in May. Unfortunately, all those models will not be able to support WiFi. The report says, from early this year, all three Chinese telecom carriers began mandating that access points (AP) equipment support WAPI. Chinese Text

MIIT: 3G to Contribute Billions of Revenue to Chinese Economy

Xi Guohua, MIIT Vice Minister, said in the Boao Forum 2009 that the contribution of 3G industry to Chinese economy is more than RMB 400 billion as the media have widely estimated, instead, it can be up to RMB 1 trillion. He gave an example that the chip sector will be greatly benefited from 3G. Chinese Text

China Telecom Successfully Delivers 3G Service to Boao Forum 2009

During the Boao Forum 2009, China Telecom has successfully provided its CDMA 2000 services to the event, and enabled thousands of participants a great experience with its 3G services, according to sources from China Telecom. Chinese Text

Shenzhen's Copycat Mobile Phone Industry Hosts One Million Jobs

According to a Sina.com estimation, almost one million people now work in Shenzhen's copycat mobile phone sector (nicknamed as "cottage-made phones" in China). Chinese Text

 

Trade and Investment

Nokia Sales in China Declines 14.8% in Q1

According to latest Nokia financial report, the company sold 17.9 million mobile phones in China, a decrease of 14.8% compared with the same period of last year. However, the figure was 38.8% higher than the preceding quarter, in which Nokia sold 12.9 million phones in the Chinese market. Chinese Text

China to Strengthen Cooperation with Finland in Comm. Sector

In the Sino-Finland Communications Strategy Conference held on April 21, senior government ICT officials from both countries, including Chinese Minister of Science and Technology and Finnish Prime Minister, attended the event and delivered addresses. The speakers all vowed to strengthen cooperation in the communications sector. Chinese Text

Semiconductor

SMIC Posts Net Loss of USD 440m

SMIC, China's largest semiconductor foundry, stated in its financial report that the company posts a net loss of up to USD 440 million in 2008, thanks to the financial crisis. As part of the efforts to minimize cost, the company has announced to cut staff salary by 15% in the months to come. The company also plans to lower capital expenditure, from USD 660m in 2008 to USD 190m this year. Chinese Text

First TFT-LCD Lab in China

China's principle flat panel display maker BOE kicked off the construction of the BOE TFT-LCD Lab in Beijing on April 21st. BOE executive said in the opening ceremony that the Lab is to echo the national call for indigenous innovation and develop China's own TFT-LCD technologies. Xiao Hua, MIIT director general overseeing the electronics sector, said China is still weak in flat panel display technologies, and the country regards this as a key priority for development in the next few years. Chinese Text

Internet

Netease Wins 3-year License for World of Warcraft

Chinese online game vendor Netease Inc announced that it has got the license to run Activision Blizzard Inc's blockbuster video game 'World of Warcraft' in China for the next three years. That has put an end to the effort of The9 Inc, the Shanghai-based online game operator, to extend its original contract to operate the game in a country that has the world's largest online population. Full Text

MIIT: China Has 117.6 Million Mobile Internet Users

Xi Guohua, MIIT Vice Minister, said in the 2009 Boao Forum that China currently boasts 117.6 million mobile Internet users, among the 316 million Internet user base. He said over 90% of Chinese Internet users access the web via broadband, and a growing number of users are going through mobile phones for Internet. 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.

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