U.S. Commercial Service - American Embassy, Beijing
Vol. 2 No. 166
The China Commercial Brief is a biweekly publication featuring summaries about developments in China's various commercial sectors, tips on doing business in China, and U.S. Embassy news. This publication is free of charge; please forward it to your colleagues and friends who are interested in China.
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Editor: Matt Gettman,
Contributors: CS Shanghai, Wan Xiaolei , Sun Shuyu , Wang Ling, Xi Xianmin, Cao Yue
News Briefs
In addition to the article summaries provided by CS Beijing, our four China branch offices - Chengdu, Guangzhou, Shanghai and Shenyang - submit summaries of commercial articles from their local press to the CCB on a rotating schedule. This week we are pleased to feature a contribution from our Shanghai post.
1. Emergency Call for Electronic Waste Disposal Plant
2. Nuclear Power Will Account for 4% by 2020
3. Active Pharmaceutical Ingredients China Show (2004 Kunming)
4. Epoxy Resin’ Market Overview and Expectation
5. China Passes E-signature Law
6. USD 24.19 billion (RMB 300 billion) is to be Invested into Forestry and Paper Industry in China
1. Emergency Call for Electronic Waste Disposal Plant
In Year 2005, a flood of discarded old TV sets, computers, and cell phones will appear in Shanghai, and after that, the amount of electronic waste generated every year will exceed 100,000 tons per year. Nevertheless, up to now, there is not a single electronic waste disposal plant established in the city.
In the 80’s and the 90’s, a huge amount of electronic home appliances entered Shanghai households. Based on their average life span, there will be over 100,000 tons of electronic waste generated, of which there will be 250,000 TV sets, 200,000 refrigerators, and 200,000 washing machines. Apart from the Kinescopes of the TV sets and the mother-boards of the computers that will be traded in the second-hand market, most parts are thrown away.
Mr. Huang Jianqing, secretary of the Association of Waste Material Recycling in Shanghai indicated that about 30% of the electronic waste were discarded through various channels, the remaining 70% still remained in offices and residences, although remain unused. If an appropriate method is not found to dispose that discarded waste, the result could be environmentally catastrophic.
Professor Lu Zhu of the School of Resources and Environmental Engineering, East China Institute of Technology, said that most electronic waste is dismantled before being thrown away, and the acid liquid and scrap emitted could cause serious pollution to the water, soil and air around.
Having realized this serious problem, the Shanghai Municipal Government began to look for potential electronic waste disposal plants and certify them, but according to Mr. Huang Jianqing, not a single license has been granted since the regulation was released last year.
(Source: Shanghai Morning Post , 07/22/2004 - Translated by FCS Shanghai)
2. Nuclear Power Will Account for 4% by 2020
China will greatly speed up its nuclear power construction to achieve a total nuclear power capacity of 36 million kilowatts by 2020, as stated by Zhang Huazhu, head of the China Atomic Energy Authority, at a press conference held on September 1st.
"All new nuclear power projects will be constructed in the principle of putting security and quality first," Zhang further said.
Nuclear power plants, which makes up 1.7 percent of the total installed capacity of power-generating facilities in China, produced 43.8 billion kwh of electricity last year, accounting for 2.29 percent of the country's total power output.
The Chinese government has endorsed the expansion of two nuclear power plants, one in Shanmen of Zhejiang and the other in Ling'ao of Guangdong. Another two nuclear power projects, including the second phase of Qinshan and Yangjiang in Guangdong, are being considered for approval.
The new nuclear power plants will sharply reduce the use of 120 million tons of raw coal, which in turn will ease the pressure on fuel transportation and environmental protection for current coal usage.
(Source: China Economic Times, 09/02/2004 - Translated by Wan Xiaolei)
3. Active Pharmaceutical Ingredients (API) China Show (2004 Kunming)
The 53rd API China (2004 Kunming) is to be held from November 24-26, 2004 at Kunming International Convention & Exhibition Center. With a history of 40 years, the last show in May had an exhibition area of 31,000 square meters and had participation from over 1,000 manufacturers with 1,500 APIs and intermediates and 30,000 professional attendees. Apart from domestic exhibitors, the international players that participated in the last show included: DSM, BASF, ISP, ExxonMobil, Colorcon, Noveon, CAPSUGEL, and Dolder AG.
According to the information provided by the show organizer China National Pharmaceutical Group Corp (SINOPHARM), almost all Chinese drug producers interested in U.S. products will attend the show seeking to purchase ingredients, intermediates, excipients, packaging, and machinery. This show is good opportunity for U.S. companies in this industry to find buyers and distributors. Interested U.S. companies may visit the website at www.apichina.com.cn and contact: Mr. Qinghua Wei, API Exhibition Dept, Tel: 8610-8207-4500, Fax: 8610-6235-8733, email: weiq@cpec.com.cn
(Source: China National Pharmaceutical Group Corp, - Translated by Sun Shuyu)
4. Epoxy Resin’ Market Overview and Expectation
Presently, there are more than 200 epoxy resin producers in China, mainly located in Yangtze River Delta, Pearl River Delta, Beijing and Tianjin areas. The total production capacity is over 400,000 tons. Among them, there are 9 producers with production capacity over 100,000 tons. The production of these 9 producers in 2003 was 288,000 tons accounting for 76.76% of China’s total production. It is estimated that by the year of 2005, the market share of these 9 producers will expand to 88%. In the first and second quarters of this year, China’s epoxy resin production reached 141,000 tons, which leads to the estimation that by the end of 2004, the total production will reach 300,000 tons. For details, please refer to the table below:
Table: China’s Epoxy Resin’s Production, Import & Export and Apparent Consumption in 2002-2004
Unit: 1000 tons
Year Production Import Export Apparent Consumption
2002 200 181.5 19.6 361.9
2003 288 198.8 35.6 451.2
Increase Rate(%) 44 9.5 81.6 24.7
2004 300 256 47.8 508.2
Increase Rate(%) 4.1 28.8 34.3 12.6
From the figure of epoxy resin import in 2002 and 2003, the import increase rate will be 9.5%. According to this rate, the total epoxy resin import in 2004 will be about 218,000 tons. But, this is a relatively conservative estimation. Industry insiders believe that imports will reach over 250,000 tons in 2004.
(Source: China Chemical News, Vol. 34, 08/30/2004,- Translated by Wang Ling)
5. China Passes E-signature Law
According to Xinhua News Agency report, China has passed the "Electronic Signature Law" on August 28 at the 11th meeting of the 10th National People's Congress. The law specifies that reliable electronic signatures have the same legal effect as manual signatures or stamps. The law will go into effect on April 1, 2005.
When two parties use e-signature to conduct business, a third party is needed to provide certification of the identity of the signatory parties. The third party is labeled the certificate authority (CA). According to this new law, CA agencies need to get licenses from the relevant government agency in charge in order to provide this service.
The following exceptions are not subject to the law: contracts or documents involving a) public utility services including suspension of water, heat, gas, electricity supplies; b) human relationship such as marriage, adoption and inheritance; and, c) transfer of rights to real estate or land.
(Source: C Beijing Youth Daily, 08/29/2004,-Translated by Xi Xianmin)
6.USD 24.19 billion (RMB 300 billion) is to be Invested into Forestry and Paper Industry in China.
Based on the Tenth Five-Year Plan and 2010 Special Program on National Forestry and Paper Integration Project Construction issued by the National Development and Reform Commission, P.R.C. (NDRC), China is going to make an investment of USD24.19 billion (RMB300 billion) into forestry and paper industry in China in the next ten years and is expecting overseas investment in its paper industry.
It is reported that China is going to combine pulp and paper making industries with construction of papermaking forest bases to achieve the integrity of high efficiency in economy, ecology and society aspects. It is expected to establish 5 million hectares of fast-growing and high-yield timber forest bases to increase 5.5 million tons of pulp output, with domestic pulp ration soaring to 15% comparing the current 6%. Paper industry and forestry are going to be developed in separate phases, with less water consumption and less pollutant emission in papermaking industry.
At present, the global paper and paperboard consumption equals approximately 300 million tons. In 2002 China consumed 43.32 million tons of paper and paperboard including domestic production of 37.8 million tons. In 2002 China imported 18.75 million tons of paper-related products, covering pulp, waste paper, paper and paperboard, and paper products, valued at USD 7 billion, and grew into a big player in terms of consumption, manufacture, and importation in the paper industry.
Experts state that China is projected to consume 50 million tons of paper and paperboard in 2005 and 70 million tons in 2010. Experts expect the packaging paper sector to be popular with great market potential, driving growth in paper demand in agricultural, printing, chemical, machinery and transportation industries.
(Source: China Packaging News, July 22, 2004 - Translated by Yue Cao)
Consulate News: Shanghai
In keeping with our goal of making the CCB a more integrated publication, our four China branch offices - Chengdu, Guangzhou, Shanghai and Shenyang - submit consulate news to the CCB on a rotating schedule. This week, we are pleased to feature a contribution from CS Shanghai.
SHANGHAI ENERGY SITUATION RESULTS IN CAUTION
Although Shanghai remains the city of choice for much incoming FDI and many U.S businesses conducting business in China, according to a just released survey of members from the American, British and French chambers of commerce in Shanghai, Shanghai's energy shortage is negatively impacting both the ability of members to operate their businesses as well as their decisions on investment into Shanghai. Only 16% of respondents stated that the energy shortage had not at all impacted their reputation in the supply chain, while 53% of respondents claimed a significant impact. Specific comments mentioned companies’ inability to meet supply schedules, the need for longer lead times, and the risk to machinery directly resulting from an energy shortage. A majority of respondents also stated that the energy shortage would have a moderate to large impact on investment decisions; only 17% of companies claimed no impact on investment decisions as a result of the shortage. Finally, a majority of companies claimed that electricity is now higher in Shanghai than in comparable factories elsewhere in the world. Although these signs would normally be considered with some concern, others say that Shanghai's hot summer and electricity shortages are helping to bring about the soft landing to an overheated economy as hoped by the Chinese officials.
For more information on CS Shanghai and the Shanghai consular region, visit our website at http://www.buyusa.gov/china/en/Shanghai.html
DISCLAIMER: CS China does not guarantee the veracity of the original sources of our news summaries. While we do our best to report accurate and timely articles and news sources, you should always check the source for further information.
The China Commercial Brief is a free newsletter published by the U.S. Embassy- Beijing.
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INTERNATIONAL COPYRIGHT, U.S. COMMERCIAL SERVICE AND U.S. DEPARTMENT OF STATE, 2004. ALL RIGHTS RESERVED OUTSIDE OF THE UNITED STATES.