China Economy Forum

[navtrek]

Correct, we should focus on quality and creating. But low reliability is not a proper word here. I think people always get what he pays for. A rich person will always choose the expensive and highest quality product and they are willing to pay for it. While other people who are not so rich, would have to consider which product is of highest cost performance, because they want to pay less for product. Actually, Chinese mobile phones are welcomed at least in Africa, maybe India.

Hmm you are correct about the pricing. I mentioned reliability because Chinese companies try to compete by offering cheap products but making something cheap comes at a cost of quality.

Once they are established they should start providing good quality products. That will be a challenging task as competition becomes tougher.

And Chinese mobiles are doing well in India too. I think a lot of Indian companies have their phones manufactured in China.

 

[Kolaps]

China is great at manufacturing goods but now Chinese companies should give more importance to quality of their products. Then their products will be unstoppable.

Right now their products have very low reliability but users like me would like to by cheap electronics but would also like to use it for long durations without any repairs.

So Quality and Service should be the main improvement points

At the early period, Chinese products had bad quality.

But today, quality is not a problem anymore. From a simple tools to computers. If there are still poor quality product, it's more likely as market choice.

The problem China today is in the intellectual capitalism. They have bad product design...no doubt about it.

 

[Kolaps]

that is not fair! Thanks to your price dumping pratice such as in solar cells, nearly all European firms went burst, including formerly highly competitive German solar cell industry.

Germans and US solar cells factory are in the different market level, which is for high-end market. They are very profitable and survive.

Actually China solar cells help to reduce the price down to the affordable level greatly, without it, solar cells will never as popular as today.

 

[Kolaps]

Hmm you are correct about the pricing. I mentioned reliability because Chinese companies try to compete by offering cheap products but making something cheap comes at a cost of quality.

Once they are established they should start providing good quality products. That will be a challenging task as competition becomes tougher.

And Chinese mobiles are doing well in India too. I think a lot of Indian companies have their phones manufactured in China.

It's the buyer, market or importer decision, not the factory.

Those extreme cheap products will die by itself, once people income increase, as they will prefer more expensive and better quality. It happened in China. In many cases, expensive products are actually far popular, dominating market share. And extreme cheap product die and out of the market by itself.

If you are wealthy person, buy extreme cheap product, it's bad for you. But for extreme poor people, the extreme cheap product is actually helping them. Their standard of living kind of improved.

 

[ephone]

We do have quite a lot quality products which are not cheap.

So we cater to the needs of different customers. For those who want cheap goods, well, it will be quite hard to get both: price and quality.

If you want to pay more, China offer, though not all, but almost every kind of quality goods you can think of.

China is great at manufacturing goods but now Chinese companies should give more importance to quality of their products. Then their products will be unstoppable.

Right now their products have very low reliability but users like me would like to by cheap electronics but would also like to use it for long durations without any repairs.

So Quality and Service should be the main improvement points

 

[navtrek]

We do have quite a lot quality products which are not cheap.

So we cater to the needs of different customers. For those who want cheap goods, well, it will be quite hard to get both: price and quality.

If you want to pay more, China offer, though not all, but almost every kind of quality goods you can think of.

i have many manufacturing tie ups for my electronic products in China so my comments were specific to my experiences with working with Chinese companies.

 

[djsjs]

i have many manufacturing tie ups for my electronic products in China so my comments were specific to my experiences with working with Chinese companies.

understandable comment.
different from other people,Indian businessmen always import the cheapest goods.i heared an India bargain the mobilephone price to 40rmb,what hope can you lay on such a phone?
if you have face quality problems with our electronic goods . i bet they are from some small companies which sell product only to overseas,Chinese consumers don't buy.
people from other countries can never imagine how rich choices we have for each kind of goods.

 

[navtrek]

understandable comment.
different from other people,Indian businessmen always import the cheapest goods.i heared an India bargain the mobilephone price to 40rmb,what hope can you lay on such a phone?
if you have face quality problems with our electronic goods . i bet they are from some small companies which sell product only to overseas,Chinese consumers don't buy.
people from other countries can never imagine how rich choices we have for each kind of goods.

Again i dont disagree with the above statement in a consumer oriented economy of course people will have the best bang for the buck.

We had quality problems with lasers and we just finally decided to set up a plant in India it was a big risk for me as both an engineer and an entrepreneur but it was worth it. And now we have sold 17 such machines to China so that notion of Chinese consumers wont buy is wrong. Quality and worth for money is all that matters.

 

[shuttler]

that is not fair! Thanks to your price dumping pratice such as in solar cells, nearly all European firms went burst, including formerly highly competitive German solar cell industry.

both China and EU have settled the deal in time to prevent escalation of a trade war
eu will see their imports of chemicals autos wines machinery ... into China where our corresponding industries suffer!

It is called bilateral trade! Deal with it!

 

[ephone]

Well, your ties may be only to certain tier of manufacturers. So using the quality/price from that tier of goods does not reflect he whole pictures.

There are tons of fantastic goods manufactured in China that are great in quality but not cheap.

Those who think Made-In-China equals to cheap/bad quality are really frogs deep in the bottom of well. They think the size of the well if just the size of the sky.

i have many manufacturing tie ups for my electronic products in China so my comments were specific to my experiences with working with Chinese companies.

 

[ephone]

China has improved a lot in design; in addition, a lot of foreign designers are at the helm as well... they have improved the quality and also trained a lot of Chinese designers at the same time...

At the early period, Chinese products had bad quality.

But today, quality is not a problem anymore. From a simple tools to computers. If there are still poor quality product, it's more likely as market choice.

The problem China today is in the intellectual capitalism. They have bad product design...no doubt about it.

 

[cirr]

China's trade data surge past expectations

Published: Thursday, 8 Aug 2013 | 2:00 AM ET

By: Li Anne Wong | Senior Digital Editor, CNBC Asia

China posted stronger-than-expected trade figures on Thursday, the latest in a string of upbeat data and raising hopes that the world's second biggest economy may be stabilizing.

Exports rose 5.1 percent in July, compared to a Reuters forecast of a 3 percent rise, and much better than the 3.1 percent fall in June.

Meanwhile, imports jumped 10.9 percent in the month, versus expectations of a 2.1 percent rise and following the 0.7 percent drop in June.

Trade surplus came in at $17.8 billion, compared to forecast of $27.2 billion.

The data triggered swift reaction in the markets.The Australia dollar rose 0.9 percent to $0.9073, while shares in Hong Kong and China rose 0.8 percent and 0.5 percent, respectively, before reversing some of the gains in the late session.

"China trade data for July indicates a rebound of external demand and a re-surgence of domestic demand," said Dariusz Kowalczyk, senior economist and strategist of Asia ex-Japan at Credit Agricole told CNBC.

"All this confirms our view that the economy has bottomed out and will re-accelerate in the second half. We'd like to call the end to worries over China for this year," he added.

The trade figures are the first in a flurry of economic data this week that investors hope will show continued signs of improvement in China's economy.

The government's twin Purchasing Managers' Index (PMI) reports for the manufacturing and non-manufacturing sectors for July in the past week both came in better than expected, raising hopes that the slowing economy may be getting some of its growth mojo back.

But Alistair Chan, economist at Moody's Analytics, say the numbers reflect similar trade conditions back in April, so it's more a "return to normal conditions" than a bounce.

"At the end of the day exporters are still having to contend with weak global demand, and the currency is quite strong as well so I don't think it's going to be much upside for exports to this year," he said.

"To be honest, I think this is probably as good as it will get – I don't the growth rate is going to continue going much higher," he added.

Little comfort

Other analysts argue that the recent improved economic readings, while reassuring to investors, don't resolve the 'unknown' structural problems in China.

"I've got a very low level of confidence in my assessment of what's going to happen in China between now for the rest of the year," Simon Warner, head of macro markets at AMP Capital said.

"If Chinese GDP stabilizes, then the global economy is going to look fine and dandy in 2014 but the problem is all those 'known unknowns' of structural problems in China like the shadow banking system and appallingly poor capital allocation model," he noted.

According to Wendy Liu, head of China equity research at Nomura, Friday's data –which include inflation, retail sales and industrial output figures – are a better gauge of the economy than the trade numbers.

"People will be looking to tomorrow's numbers more so than today's," said Liu. "There tends to be quite a bit of volatility with the trade numbers on a monthly basis and also, some adjustment as to what's real and what is fictitious trade."

 

[cirr]

China's CPI Up 2.7% in July

2013-08-09 10:11

China's consumer price index (CPI) rose 2.7 percent year-on-year in July, the same pace of growth registered in June. The National Bureau of Statistics (NBS) released the inflation data, along with other economic indicators earlier this morning.

According to the NBS, prices grew by 2.6 percent in urban areas and 2.9 percent in rural areas. Food prices rose 5 percent, roughly the same pace of expansion as in June, contributing 1.61 percentage points to the overall increase in CPI. Non-food prices increased by 1.6 percent, also about the same pace of growth registered last month.

The price of consumer goods rose by 2.7 percent and the price of services grew by 2.7 percent.

The NBS also said that China's CPI grew by 2.4 percent over the first seven months of 2013 when compared to the same period last year.

In March 2013, in an address to the National People's Congress (NPC), former premier Wen Jiabao said that the central government expected the CPI to rise by about 3.5 percent over the course of 2013.

On average over the course of 2012, overall consumer prices were up by 2.6 percent when compared to 2011, well below the target of 4 percent growth set by Premier Wen Jiabao during his annual work report to the National People's Congress in March last year.

China's CPI averaged growth of 5.4 percent in 2011.

Rising food prices helped drive the July CPI reading higher, though the NBS noted that food prices actually remained stable on a month-on-month basis.

The NBS reported that prices of fresh vegetables rose by 11.8 percent year-on-year in July, after falling by almost 2 percent in May. The price of meat, poultry and related products rose by 5.9 percent. Pork prices also continued to rise on a year-on-year basis, up 3 percent year-on-year last month.

Pork prices in July were also up by 1.7 percent on June, but the pace of month-on-month growth had slowed by 2.9 percentage points.

Non-food prices increased by 0.2 percent month-on-month, with an increase in travel over the summer helping to push the price of related services higher. For example, plan tickets rose by 8.1 percent in July compared to June.

According to the NBS, housing-related prices were up by 2.8 percent year-on-year in July, with rental costs up 4.4 percent.

The producer price index (PPI), another measure of inflation at the wholesale level, fell 2.3 percent in July when compared to the same month in 2012. This marked the 17th consecutive month that the PPI reading has been negative.

Over the first seven months of 2013, the PPI fell by 2.2 percent when compared to the same period of 2012.

 

[cirr]

Yuan hits 19-year high against US dollar

Shanghai Daily, August 8, 2013

China's yuan strengthened to a 19-year record against the US dollar Wednesday amid Chinese officials' pledge to stabilize economic growth.

The yuan closed at 6.1192 per US dollar yesterday, up from Tuesday's 6.1217, and was the strongest since China unified the official and market exchange rates at the end of 1993.

The previous high was hit on June 3 and May 27 this year, when the Chinese currency reached 6.1210 on both days.

The strengthening on the spot market outpaced the rise of the central parity rate, as the People's Bank of China set the daily fixing at 6.1726, only 0.04 percent stronger than Tuesday's 6.1753.

The yuan is allowed to trade at 1 percent on each side of the central parity rate.

Li Youhuan, a professor at Beijing Jiaotong University, said July data may be better than expected as the central government has taken an array of measures, including tax cuts and investment in railways, to boost the economy, reigniting market expectations for a stronger yuan.

But he said the currency's appreciation will be limited as exporters are still suffering from an economic slowdown.

Traders said the yuan rose faster in late-day trading, indicating the central bank's intention to support further appreciation of the currency.

China's exports, factory output and retail sales may have all edged up in July, according to a Reuters poll, showing initial signs of stabilization in the economy as the government takes targeted steps to head off a sharper slowdown.

China should make monetary controls more coordinated and use multiple tools to ensure stable and moderate credit growth, Financial News, published by the central bank, said in a commentary yesterday.

The yuan has gained 1.8 percent so far this year, bucking a weak trend in emerging market currencies. The appreciation has slowed down since June.

A Standard Chartered Bank report yesterday said global yuan activities grew 65 percent year on year in June, indicating ongoing internationalization of the currency despite China's falling exports and recent liquidity crunch.

 

[cirr]

China’s Second Largest Hydropower Plant Starts Operation

July 23, 2013

China’s second-largest hydropower station officially started operation this month after a three-day test run.

AsianScientist (Jul. 23, 2013) – China’s second-largest hydropower station officially started operation this month after a three-day trial, reports the state-run Xinhua news agency.

The first generator unit, 13F, which has a capacity of 770,000 kW, started providing electricity on July 15 to the China Southern Power Grid, its operator China Three Gorges Corporation said in a statement.

The Xiluodu hydropower station is located on the lower reach of Jinsha River, between Leibo county of Sichuan province and Yongshan county of Yunnan province, both in Southwest China.

With a total hydroelectric generating capacity of 13.86 gigawatts, the Xiluodu plant will be the second largest in China once all of its 18 units go into operation in 2014. The hydropower station is also the world’s third largest after the Three Gorges and Itaipu hydroelectric projects.

Construction of the hydropower plant began in 2005, and the project is expected to be completed in 2015.

China