U.S Commercial Service - American Embassy, Beijing
Vol. 2 No. 172
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, CS Shenyang & Chengdu, Baochun Mei, Shujuan Cao, Yi Wang, Ye Xu, Xiaolei Wan, Xianmin Xi
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 Shenyang and Chengdu post.
1. China Development Bank commits USD 6.05 billion in loans to Liaoning
2. Sichuan Version of "Disneyland" to be Located in Wenjiang, Chengdu
3. China plans to reform coal mining industry
4. China's Export Tax Rebate on certain IT Products Reaches 17%
5. China Revises Law to Resolve Serious Solid Waste Pollution Challenges
6. China’s Policy Change on Importing Auto Products in 2005
7. Beijing First Medical Waste Incinerator In Operation
8. Beijing Set up Special Fund and Testing Center to Encourage IC Design
1.China Development Bank commits USD 6.05 billion (RMB 50 billion) in loans to Liaoning
The China Development Bank recently signed a cooperation agreement with the government of Liaoning Province. Under the agreement, the Bank will grant a soft loan of USD 6.05 billion (RMB 50 billion), and a technical assistance loan of USD 121 million (RMB 1 billion) to support rejuvenation of the old industrial base in Liaoning. More than half of the two loans would be allocated to modern manufacturing enterprises, such as Shenyang Machine Tools. The agreement is said to be the largest cooperation between the financial sector and local government in terms of scope and scale since the central government launched the "Revitalize the Northeast" policy.
Under the agreement, the loans will go to industries such as energy, transportation, water conservation, urban public utilities, basic industries, pillar industries and their supporting facilities, as well as to rebuilding shanty towns and areas around collapsed coal mines, and to the development of education, sanitation, and other social services.
The China Development Bank has granted a cumulative total of USD 10.3 billion (RMB 85.1 billion) in loans to Liaoning Province. The province has received all but USD 5.4 billion (RMB 44.6 billion) of these loans.
(Translated by CS Shenyang)
2. Sichuan Version of "Disneyland" to be Located in Wenjiang, Chengdu
By the end of this year, Chengdu’s entertainment enthusiasts will be greeted by a Disneyland-like amusement park in their own city. On January 24, 2005, following the agreement reached between U.S.-based Landmark and Chengdu Zhi Xin Group for the "Project of the 6th China Horticulture Expo and Fascinating Culture Garden First China International Culture Exchange Entertainment Land"- a Sichuan version of Disneyland will be developed in Wenjiang, 15 km west of Chengdu.
Six cultural themes: China, Japan, Spain, France, Germany, and Belgium will form the Sichuan Version of “Disney Land”. The project will be designed by famous landscape designers with a total land coverage of 1,107 mu (737 hectares or 1,823 acres). Landmark will provide all the entertainment elements and components and the public can experience the wonderful feelings of having meals on the desert and beach.
The Sichuan version of "Disneyland"– 6th China Horticulture Expo and Fascinating Culture Garden is a joint project between Wenjiang District Government and Chengdu Zhi Xin Group. According to the estimates by Zhi Xin Group, the investment on the entertainment park will be over USD 12 million (100 million RMB).
(Source: Hua Xi Urban Daily, 01/25/2005 - Translated by CS Chengdu)
3. China plans to reform coal mining industry
China is speeding up construction of 13 large coal production bases and organizing large coal enterprises groups so as to further explore production potentials and ensure coal supply in the country, according to an official of the State Development and Reform Commission.
National Development and Reform Commission (NDRC) has drafted outlines for further study of the plan of construction of large coalmines. Detailed plans covering coal exploitation, coal transportation, environmental protection and regional economic development. It will be worked out before the end of this year or early next year after feedback from the local governments. Chinese government had earmarked USD 290 million of funds from the state bonds in the 2003-2004 period to support the exploration and construction of large coal production bases and mines.
The 13 bases will be located mainly in the country's major coal-producing areas such as Shanxi and Hebei provinces and Inner Mongolia Autonomous Region in North China and Shaanxi Province in Northwest China. The areas are designated according to conditions of the existing coalmines, coal reserves, coal exploration, development, potentials, market supply and transportation conditions.
China has about 24,000 small coalmines currently. Because of some loopholes in management and outdated equipment, the coal resources in these small mines cannot be fully utilized and work safety has become a growing concern. Frequent coalmine gas explosions, exasperated by China's energy shortage and heavy reliance on coal, spurred the Chinese government to reform the industry. As part of the country's medium and long-term plans for energy and coal industry development, the construction of the bases will help tap potential coal resources and ease energy shortages.
(Source: China Business News, 12/03/2004 - Translated by Michael Mei)
4. China's Export Tax Rebate on certain IT Products Reaches 17%
According to an announcement by the Ministry of Finance and the State Administration of Taxation, starting November 1, 2004, certain IT product exported from China began to receive a full 17% tax rebate. The previous rebate equaled 13%, 4 percentage points shy of the actual 17% tax. However, the new 17% rebate equates to a 100% export tax rebate.
The listed IT products include: integrated circuits, partial discrete components, mobile communication base stations, Ethernet, routers, hand/vehicular mobile phones, micro-digital data processing machines, systematic micro-computers, liquid crystal displays (LCD), cathode ray tubes (CRT), hard drives, and other digital auto-data processing equipment.
This move supports a September 2004 announcement from the State Development and Reform Committee indicating that China would further encourage the development of the integrated circuit industry and would implement a 100% export tax rebate policy.
(Sources: China Information World, 01/03/2005- Translated by Merry Cao)
5. China Revises Law to Resolve Serious Solid Waste Pollution Challenges
On December 29 2004, the 13th session of the Standing Committee of the 10th National People's Congress (NPC) approved an amendment to the Law on Solid Waste Pollution Prevention and Control to resolve the increasingly serious challenges caused by solid waste pollution. The revised law will take effect on April 1, 2005.
"Encouraging the recycling of solid waste and clarifying the responsibility of the polluters are the major principles of the revision," according to Mao Rubai, chairman of the Environment and Resources Protection Committee of the NPC.
The new law also clarifies that product manufacturers, importers, sellers and users are all responsible for prevention and control of solid waste pollution generated by their own.
The current law stipulates relatively clear responsibility clauses during the production process, but lacks clauses after sale and during disposal. The amendment adds the clauses on extension of manufacturers’ responsibility, and requires that the government should force the manufacturers to recycle some categories of products and packaging. Administrative department of the State Council will decide on the product list and ways of recycling.
Other important points covered by the amendment include:
- Polluters who cause damages are responsible for finding evidence in pollution damage compensation lawsuits.
- Governments at all various levels should publish solid waste information on a regular basis.
- A license system will be adopted to administrate the utilization of hazardous waste and storage of hazardous waste should not be over one year.
(Source: China Environmental News, 12/31/2004, Translated by Wang Yi)
6.China’s Policy Change on Importing Auto Products in 2005
China will have four major changes on importing auto products in 2005. The changes in 2005 are as follows:
Starting from January 1, 2005, China will abolish the quota on imports of automobile, which has been in place for 20 years. Ministry of Commerce will implement the Automatic Import License for Auto Products.
The State Council announced that to comply with its WTO commitment, China would reduce the import tariff to 30%.
Approved by the State Council, all bonded areas are not allowed to store any imported automobiles, which are targeted for entering into the Chinese market. After this change, imported automobiles must declare at customs and pay taxes as soon as arriving at the ports.
Ministry of Commerce’s Detailed Rules For Implementation of Issuing Automatic Import License for Auto Products stipulates that whoever applies for import of automobile for sales should submit authorization certificate of automobile brand distribution. Starting from 2005, only those firms, which obtained foreign auto manufacturer’s authorization are qualified to import and sell imported automobiles.
(Source: China Business Times, 12/30/2004- Translated By Ye Xu)
7. Beijing First Medical Waste Incinerator In Operation
Beijing Nangong Medical Waste Treatment Center has been put into operation after completion of the first phase. It is the first advanced medical waste collection treatment center in Beijing.
After completion of the first phase, the daily treatment capacity for Beijing Nangong Medical Waste Treatment Center reaches 15 tons per day. After completion of the second phase in 2005, the capacity could reach 30 tons per day. Under Beijing Municipal Waste Treatment white paper, the daily medical waste treatment capacity in Beijing could reach 60 tons after the completion of another Beijing Gao An Tun Medical Waste Treatment Center.
Beijing has 7000 medical units with medical waste of 41 tons per day. Starting from December 28, 2004, Beijing dispatches 10 specialized sealed vehicles to transport medical wastes to Nangong Medical Waste Treatment Center from 200 different hospitals.
(Source: China Environmental News 01/04/ 2005, - Translated by Wan Xiaolei)
8.Beijing Set up Special Fund and Testing Center to Encourage IC Design
According to a January 28 report in the China Electronics News, the Beijing Municipal government will set up a special System on Chip (SOC) Promotion Center Fund to encourage the development of SOCs. The size of the Fund will be USD 15.7 million (RMB 130 million) each year from 2005 to 2007. The fund will be used to encourage development of ICs for digital TV, telecommunication, auto-electronics, IC card and electronic identification, computer and networking, digital image processing, and semiconductor lighting fields.
On January 18, 2005, Zhongguancun IC Testing Center officially opened for business in order to meet the needs of the many IC enterprises in the Zhongguancun Science and Technology Park for professional testing services. The IC Testing Center was set up under the sponsorship of the Beijing Municipal Industry Promotion Bureau and Zhongguancun Science Park Management Committee.
(Source: China Electronics News, 01/28/2005, Page 5-Translated by Xianmin Xi)
Consulate News: Shenyang and Chengdu
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 Shenyang and Chengdu.
Dr. David Sampson, Assistant Secretary of Commerce for Economic Development, accompanied by Principal Deputy Assistant Secretary David Bearden, made his first official visit to China, January 13-19. In addition to Beijing, Dr. Sampson and P/DAS Bearden visited Shenyang and Dalian. They met with Liaoning Governor Zhang Wenyue, Shenyang Mayor Chen Zhenggao, and Dalian Mayor Xia Deren. They also met with officials from the Liaoning Development and Reform Commission, the development zones in Shenyang and Dalian, and the port corporation of Dalian. They visited Chinese and U.S. companies in those two cities. In addition, they had discussions on the northeast region with U.S. business representatives in Beijing and Shenyang, and with officials of the Asian Development Bank and the World Bank in Beijing.
For more information on CS Shenyang and the Shenyang consular region, visit our website at http://www.buyusa.gov/china/en/shenyang.html
The U.S.-China Legislative Drafting Roundtable Successfully Held in Chongqing and Kunming: Sponsored by the Legislative Affairs Commission of the National People's Congress of China and the U.S. Department of Commerce, the U.S.-China Legislative Drafting Roundtable was successfully held in Chongqing on January 7 and in Kunming on January 10. Ms. Polly Craighill, Assistant Counsel of the U.S. Senate, provided a presentation on “Transparency in Formulation, Enactment and Implementation of Legislation in the U.S.” and Ms. Sandra Strokoff, Senior Counsel, Legislative Counsel of the U.S. House of Representatives, made a presentation on “Case Studies of the U.S. Legislative Process and Reconciliation of Conflicting or Competing Interests.” The U.S. speakers also addressed the audience on Trade Advisory System, Preemption and Benefits of Transparency.
For more information on CS Chengdu and the Chengdu consular region, visit our website at http://www.buyusa.gov/china/en/chengdu.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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