Posted on 09/02/2009 4:14:48 PM PDT by bruinbirdman
Doing business in China is getting harder, not easier, according to European businesses, as they laid out almost 600 pages of complaints in a new report.
The report, from the European Union Chamber of Commerce in China, covers the whole gamut of the Chinese economy, from industrial chemicals to mobile phones to banking.
It paints a troubling picture of the Chinese business landscape, filled with discrimination against foreign companies, arbitrary laws and regulations, and abuses of China's World Trade Organisation obligations.
Although China has repeatedly complained about protectionism in the United States and Europe, the report suggests that China is one of the most protectionist major economies.
Joerg Wuttke, the president of the European Chamber, warned that "China needs Europe more than Europe needs China", and pointed out that the EU is a bigger market than the US for China, and exports to European countries make up 7pc of Chinese GDP.
According to the World Bank, China ranks 83rd out of 181 countries in its annual assessment of how easy it is to do business. The emerging superpower scored lower than Kenya, Vanuatu and Colombia, but was judged better than Sierra Leone and Belarus.
Now, however, the business climate is getting worse. Mr Wuttke said in many sectors there had been "a slowdown, and in some cases partial reversal, of the reforms of recent years".
He noted that there have been a rising number of government interventions and that foreign investment restrictions have also increased. EU report contains over 500 recommendations on how China could improve the situation, drawn from the 1,400 European companies working in the country.
In particular, the report criticises China's joint-venture requirements, which means that foreign companies in some sectors can only own up to 50pc of a company.
In the car sector,
(Excerpt) Read more at telegraph.co.uk ...
Opinion?
As if we didn't already know that.
Let’s see: a coming trade war that splits the world into three trading spheres with Africa up for grabs. That ought to get world trade going again or start a very bloody real war.
I wonder if China is looking down at those ‘Pieces of Paper’ with promises to pay on them, and seeing them in a different light yet! They sure better start changing their perspective on the value of those bits of paper with letters on, then the imminent, coming shock won’t hurt so much.
My opinion is we could use a little of the same here! What is wrong with putting Americans and American business’s first?
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=anLwixE1v6Ak
http://michiganmessenger.com/25574/detroit-sets-record-for-unemployment
http://online.wsj.com/article/SB124994409537920819.html
http://www.businessweek.com/smallbiz/running_small_business/archives/
2009/09/298000_jobs_she.html
http://online.wsj.com/article/SB125182848772276871.html
It’s hard to do business anywhere these days. China’s bad but are we much better?
Our government illegally seizes assets from bond holders. We also illegally seize property. Outrageous regulations are propped up to destroy small businesses, and useful regulations are ignored or watered down so that huge corporations can game the system and steal trillions.
Add to all of that, we now have a President and congress that believe in “social justice”- taking from the hard workers and giving to their corrupt, useless supporters, like ACORN.
Ahhh, Acorn. Are the people on the payroll being given tax dollar salaries as reparation?
Yeah, I’m not seeing any change, but have heard that starting a new business is a lot more difficult, and that the new tough policies stem from the huge number of cut-and-run foreign companies that closed up in China in the last 2 years.
In China (and in Hong Kong), you capitalize your company when you form it, meaning you personally guarantee a minimum level of financial payback. If you capitalize at 1 million RMB, then the founders of the company are on the hook for up to 1 million RMB, even after bankruptcy.
What’s happened quite a bit in the last few years are foreign companies are shutting down their Chinese divisions and simply leaving. Not paying debts, not declaring bankruptcy, just closing the doors and walking away, leaving a lot of Chinese suppliers holding the bag.
And often, those suppliers would “float” an invoice for 30-60 days based upon the capitalization of the company. If you are capitalized for 1 million RMB, and you have 500,000 RMB in invoices out, I should feel OK floating your invoice for 500,000 RMB, because if everything goes south and you close down, and you liquidate everything, you are still responsible for covering my debt.
However, if the owners are overseas, it’s awfully hard to get that capitalization guarantee back! So I end up going bankrupt, but since I’m in China, I have to pay my suppliers, potentially even selling my home, car, and brother’s farm to pay my capitalization debt.
So, China’s decided enough is enough. No more cutting and running. You want to capitalize? Great - you have to pony up the cash and leave it in reserves here, and you have to get Government approval for any significant funds transfer, or for extending payment terms on pending invoices.
I hear it’s a PITA (it hasn’t bothered me at all - I run cash-up-front only with everyone), but in a way I can understand it.
I’m an America First person myself, but how do you define an American business? The notion of individual liberty is in conflict with many of the proposals aimed at “domestic” American businesses.
Luckily, all governments are equally stupid. So China decides to close the door after the cows have fled, stupid.
We need these idiots to reduce regulation and taxes (and I include our own domestic idiot politicians). How can business grow us out of this mess if we keep kneecapping them at every step?
Was that your chart showing where jobs are grown?
Has anyone from the RNC called you yet to get your chart out?
Communists never play fair. Didn’t anyone ever tell you?
Well, there are still a LOT of cows banging at the door to get in! It's just going to be harder to do so...
Was that your chart showing where jobs are grown?
You mean this one?
I got it from the source on the chart - the Census Bureau! The RNC - and every freedom-loving business group - should be proudly sporting that graph anywhere they can.
I wrote a short editorial about jobs; if the Obamassiah was truly interested in getting the economy going, the last place he should put all the dollars is with big business. It should be massive tax breaks for small businesses. THAT will stimulate the economy much more!
China's not really Communist; it's a fascist oligarchy, and it's where the US appears to be heading. At least China appears to understand the benefits of a capitalistic economy; the Obama Administration appears incapable of that level of intelligence!
In China, you're not given a place to live, given a job, given food, even free healthcare doesn't exist. EVERYTHING costs. It's a highly capitalistic-based economy, which is how it really differs (economically) from the old USSR.
No money, no income? On the street. No job is guaranteed for you, no minimum level of food/clothing/shelter will be provided. You can be a bum on a street, or work your ass off and buy a Mercedes. Both of those really aren't options in Communist (or even USSR) style countries.
There are truly private enterprises here in which the State owns nothing. However, most of the biggest companies are partially or completely State-owned. And the State does have a lot of say over how your business may conduct itself.
Of course, with the US now a major owner of car and financial companies, and tightening down ever-stronger on rules and regulations, we're heading to the same type of fascist control. And just try to tell the US Government it does not get to dictate what you can do with your dollars, or even if you can keep your private business transactions private.
And with our push towards single-payer/free health care (we already give away free food to 12% of our population, something that is unheard of here in China), we're going to end up closer to the Communist ideal than China!
Aren't you from Seattle? In Illinois we don't have Democrats like that. In Cook County you can still be lynched for mentioning tax cuts.
The trouble with small businesses is it takes as much time to shake them down as big business, but the payout is 1/100th the size.
Our Dems think like Willie Sutton...
Half-time in Seattle, half-time in Shanghai (or vacinity - Nanjing to Ningbo is my usual area). Seattle loves its taxes, but thankfully most of those outside of Seattle (i.e.: 98% of the State, but sadly only 45% of the population) can’t stand taxes and Government control.
Most tax cuts do take time, but there is one tax cut that would immediately plunge $2 trillion in liquidity straight into the heart of the economy, AND predominantly into small, new businesses (where the jobs growth is):
Repeal the Capital Gains Tax. Permanently.
The trillions of dollars sitting money market funds would immediately flow into new businesses/expansion in the pursuit of higher returns, especially with the elimination of taxes on the gains.
OK, where do we start?
I think the RNC could get this going and convincingly in this current climate, but they're part of the problem.
Actually, I've thought this would be a great idea for decades and you should add killing corporate taxes (think of all that money overseas being repatriated). Both would cost less than the current "stimuli" and really would pay for themselves in the long haul. Excepting that Democrats are linear thinkers. If they were more creative they'd believe in people and... well, they wouldn't be Democrats.
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