Chongqing Is the Fourth Heat

The state-run Global Times has some not really inside information on the12th five-year plan.

China’s regional economic development during the next five years may focus on setting up a new city group as the fourth economic growth pole.

China has three city groups as economic growth poles: the Yangtze River Delta, the Pearl River Delta and the city groups around the Bohai Sea. The fourth pole is expected to achieve a balanced and coordinated regional development around the country.

The China Development Report 2010, which came out in September 21, referred to eight city groups as the main areas for development, including Hadaqi (Harbin, Daqing and Qiqihar in Heilongjiang Province), Changji (Changchun and Jilin) in Jilin Province, the central Shannxi Plain, Chengdu and Chongqing.

Marching Towards a Trade War

The great China tariff bill of 2010 was passed by the house.

I first got the news from Yves Smith, who I very much enjoy reading, but who doesn’t seem to have done her homework with regards to China. From Smith:

Everyone understands that for China move to a more consumption-driven economy is a very long term project.China could get away with a ton of foot dragging if it were taking legitimate steps in that direction, as it needs to. So far, however, it has demonstrated no commitment to that effort,so it is effectively exporting goods and related unemployment to other countries. In a period where everyone expects protracted low growth, when there is already a large overhang of unemployed workers, that will not wash. Other countries start retaliating on the trade front. (my italics)

Innovation Held Hostage in China

I recently made the acquaintance of a researcher at one of China’s highest government bodies. He has given me permission to publish one segment of our conversations, which I found particularly interesting and worthy of a larger readership (with identifying features kept out for obvious reasons). These are all just his opinions and cannot be said to represent the opinions of the Chinese government, but I think it’s appropriate to say that his positions reflects some of the conversations going on at the highest levels of the Chinese state.

Would You Trust Your Information to a Chinese Server?

Would you trust your information to a Chinese server?

That was basically the question raised by my conversation with the VP of Hisoft, a Chinese IT outsourcing company that has just listed in the US. Like many other conversations I’ve been having about intellectual property lately, he made the argument that the problem isn’t as bad as everyone thinks. The protections in place at Chinese IT outsourcing companies to prevent information leaks are as strong, or even stronger than in India, he claims, but that the industry is being held back because there aren’t enough marketing skills to counter China’s image as an IP badboy

Changes in China’s Intellectual Property Story

I was speaking to an M&A lawyer today from a large Italian law firm, and one of the many interesting topics that came up was the gigantic improvements in intellectual property protection in China. I have heard this message from a few other lawyers recently, but he threw out a few interesting reasons for this change that I hadn’t heard before.

Does Shanghai Have a Future?

There’s a lot to be said for Shanghai. The city’s infrastructure is top notch; it’s the most metropolitan Chinese city outside of Hong Kong; if the city’s shopping options are any indication then people have plenty of money to spend. Nevertheless, I think its safe to say that until something changes in China’s financial policies, the city’s growth story has pretty much ended. That’s not to say that the city won’t grow – the city continues to receive policy support and benefits from China’s overall macro-economic climate – but that the city has lost the advantages it once held over other cities, and a significant change in national policy needs to happen before Shanghai regains the initiative it once had. There are three major drivers of Shanghai’s growth and each of these have significant, and perhaps insurmountable, problems.

1. Manufacturing being priced out

Suing in China Gets an Ambiguous Boost

One of my favorite quotes since I’ve been in China I heard from a middle-aged woman who told my girlfriend “in China we don’t trust the legal system, if we need something taken care of we just hire some thugs.” I thought it very well summarized the very well justified distrust the Chinese have for the legal system, and the nasty consequences it has for business at the bottom level (and political stability in general).

China and the Alternatives to Oil

Last year, in the town of Quanzhou, right across the straight from Taiwan, a company you’ve probably never heard of opened up the world’s largest production base for bamboo fabrics (Chinese). People who follow the green blogs have probably heard of bamboo fabrics super-green qualities, or the fact that those super-green qualities are all lies, but the take away I got from that little piece of news is somewhat different. Whether or not bamboo is green, its most important quality to the Chinese is that it’s not made with oil (as most synthetic fabrics are). As oil quickly increases in price, China is doing everything it can to find other resources that can be used as alternatives; cotton and even bamboo are beneficiaries.