Stat of the day: foreign students in China

With a goal of attracting 500,000 foreign students annually by 2020, the mid-way point has now been crossed.   According to CNN:

About 290,000 studied in China in 2011, compared to just over 60,000 in 2001, according to the MOE. South Koreans (62,442) were the largest group of foreign students studying in China in 2011, followed by Americans (23,292). The Japanese (17,961), Russians (13,340), Indonesians (10,957) and Indians (9,370) also have large student populations, while almost 50,000 Europeans undertook some form of tertiary study in China in 2011, led by France (7,592) and Germany (5,451).

In contrast, there were roughly 194,000 Chinese students in the US last year and nearly 1 million foreign students altogether.

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Another Brick in the Wall: Link Edition XXII

A number of stories from a variety of segments.  Several are from Sinocism.

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Stat of the day: WWII movies and TV shows in China

Last year alone, Chinese movie studios (nearly all of which are state-owned) produced more than 200 anti-Japanese films.  Why?  Because it’s one of the few areas that isn’t completely censored due in part to the lengthy occupation of the mainland.

As Reuters recently reported:

Some film reviewers in China say that with the censors declaring so many other subjects off limits, it is only natural that the war dominates story-telling in a competitive market for viewers and advertising.

“Only anti-Japanese themes aren’t limited,” says Zhu Dake, an outspoken culture critic and professor at Shanghai’s Tongji University. “The people who make TV think that only through anti-Japanese themes will they be applauded by the narrow-minded patriots who like it.”

Zhu estimates war stories make up about 70 percent of drama on Chinese television. The state administrator approved 69 anti-Japanese television series for production last year and about 100 films. Reports in the state-controlled media said up to 40 of these were shot at Hengdian alone. State television reported in April that more than 30 series about the war were filming or in planning by the end of March.

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Another Brick in the Wall: Link Edition XXI

Big mix of links today.  Certainly wouldn’t want to be a new college grad in China without awesome guanxi.

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Another Brick in the Wall: Link Edition XX

Clearing the tabs of some article published in the last few weeks.  Thanks to Melissa for two of them.

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Another Brick in the Wall: Link Edition XIX

Anecdotatly it is hard to say what direction luxury is heading since it is such a large segment now.  Government crackdown on big Party dinners still in effect, not sure if government officials want to be made an example of (including receiving traditional gifts like watches).

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Another Brick in the Wall: Link Edition XVIII

Another relatively slow news week.  Big skillset mismatch with new college grads, sympathize with (unemployed) former students at the colleges I taught at.  Thanks to Xiao for a couple links.

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Another Brick in the Wall: Link Edition XVII

Slow news week, pretty bearish too.  There are a few bright spots.  Thanks to Larry M for sending in a couple of the stories:

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On the ground relevant data and knowledge on the mainland

Shanghaiist recently did a must-read interview with Shaun Rein.  I had the fortune of interviewing him for my book (see Ch 4 & 13), but this new interview is even better/more detailed in my opinion.

He’s one of the few laowai that truly understands what is going on here, approaching the business atmosphere with a very balanced mindset.  Check out his book and if you’re looking for a consumer research firm, he happens to manage one (CMR) as well.

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Stat of the day: Inbound tourism and expats in China

Inbound tourists who stay overnight in China:

The number of British expats working in China has risen 18%, growing from 31,160 in 2006/07 to 38,000 in 2010/11.  As of June 2012 there were about 70,000 American’s in China.  There are 600,000 foreigners who are permanent residents and 220,000 foreigners legally working on the mainland.

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Another Brick in the Wall: Link Edition XVI

Mostly China-related links from the past couple of weeks.  Thanks to those who sent them in, see Sinocism for more:

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Cryptocurrency in the news: X

Probably will be awhile before I do another curated set of links specifically for Bitcoin related topics.  Thanks to Vijay, Jeremy, Mike, Alex and Ben for the links:

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Cryptocurrency in the news: IX

Thanks to the couple of sources who sent these in:

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Stat of the day: Consumer spending in China

Consumer spending as a proportion of GDP:

*The 2012 number is debatable as some sources measure it as low as 35% yet others at 55% and even 65%.  See China’s Golden Rule of Consumption by Yukon Huang and China unlocks right kind of growth from Financial Times and Chinese shoppers are thriving from Financial Times

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Stat of the day: Yum! success in China

Yum! is the parent company of several large fast-food chains including KFC and Pizza Hut — both of which are very popular in China.  In terms of profit and revenue, consider the following:

Global Yum! (source: annual report)

  • 2010 – $1.769 billion operating profit from $11.343 billion revenue
  • 2011 – $1.815 operating profit from $12.626 billion revenue
  • 2012 – $2.294 billion operating profit from $13.633 billion in revenue

As I mention in Chapter 16, since their first store opened in 1987, KFC now operates approximately 5,000 restaurant outlets in 700 Chinese cities and is on pace to open one new store everyday of the year – with a goal of opening 15,000 across China including 700 more in 2013.1 And despite a food scare regarding antibiotics in chicken suppliers mentioned in Chapter 3, they plan to continue this expansion.2 A large reason why they have been successful is as noted above in the HBR study: adapting to local tastes with foods such as fried dough, sweet potato buns and fishball soup.  Furthermore, its parent company, Yum Brands, now operates 5,400 stores on the mainland (including Pizza Hut restaurants); more than double what it had five years ago.3 As a consequence, China now represents for over half of Yum’s operating profit and sales globally.4 In fact, in 2010, KFC China for the first time had surpassed the US market in revenue.  In contrast, McDonald’s has a mere 1,464 outlets and 16% of the fast-food restaurant market share.5

  1. Yum Brands Says The Chinese Still Love KFC from The Wall Street Journal []
  2. See Yum Brands Rebounds From Chicken Antibiotic China Scare from Bloomberg, Yum stumbles badly in China, warns on profit from Reuters and ‘Kentucky Fried China’ no more? from Reuters []
  3. Yum’s Yuck Factor in China from The Wall Street Journal []
  4. ‘Kentucky Fried China’ no more? from Reuters []
  5. KFC’s Big Game of Chicken from BusinessWeek []
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Cryptocurrency in the news: VIII

Some odds and ends of BTC today:

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Another Brick in the Wall: Link Edition XV

Nearly all China-related business news.  Check out Sinocism for more (still too busy to re-curate them).  Check out the first interview with Shaun, great info.

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Mark DeWeaver: Why China Invests in Windfarms It Can’t Use

Yesterday, Mark DeWeaver did an interview with U.S. News & World Reports regarding his recently published book on China: Animal Spirits with Chinese Characteristics.

Mark wrote the Foreword to my book and is the founder of Quantrarian Capital Management, a fund in DC.

Below is the interview:

Also viewable at Google Hangout.

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Stat of the day: GM car sales in China

China has been the largest vehicle market globally since it overtook the US in 2009.  GM, which has a partnership with SAIC, continues to sell enormous amounts of vehicles as well.  Below are some annual figures to give you an idea of the volume & revenue.

Overall GM globally

  • 2010 – $4.7 billion annual profit from $135.59 billion revenue (source)
  • 2011 – $7.6 billion annual profit from $150.28 billion revenue (source)
  • 2012 – $4.9 billion annual profit from $152.3 billion in revenue (source)

GM in China specifically

  • 2010 – Sold 2,351,610 vehicles in China (28.8% increase YoY) (source)
  • 2011 – Sold 2,547,171 vehicles in China (8.3% increase YoY) (source)
  • 2012 – Sold 2,836,128 vehicles in China (11.3% increase YoY) (source)

As I mention in Chapter 1, approximately 19.3 million automobiles were sold in China in 2012.1 By 2015 it is estimated that the Chinese car market will be larger than the US, Japan and Germany combined.234 And by 2016, McKinsey & Company – a global management consulting company – estimates that China will surpass the US as top luxury car market.5 There are now 240 million vehicles on the mainland and 20 million more vehicles will be sold this year.6 Furthermore, according to Michael Dunne, an Asian-based car market consultant, “[of] the projected 2.3 million American-branded cars Chinese will buy this year [2012], an astonishing 96% will be made in China.”7 And this growth rate has largely occurred in less than a decade.  For example, in 2004, the market for Land Rover vehicles on the mainland was a mere 1% yet has subsequently surged to 20% of Land Rovers total sales last year.89

  1. Vehicle sales overtake Europe in 2012 from China Daily and 2012: Slowing growth, maturing market from China Daily []
  2.  An estimated 20.65 million automobiles are expected to be sold in 2013.  See China 2013 Auto Sales May Accelerate This Year to Top 20 Million from BloombergChina Slowing Auto Sales Still Eclipse U.S.-Japan-Germany: Cars from Bloomberg and China’s vehicle sales remain in doldrums fromFinancial Times []
  3. One of the issues facing policy makers is traffic congestion.  Each city handles it differently, some auctioning off license plates to residents.  The cost of license plates has increased as cities have become denser and more affluent.  In Shanghai for example, in the recent license plate auction held in January 2013, the average price for a plate was $12,000.  See Shanghai’s Newest Luxury Item: The License Plate from The Wall Street Journal and Shanghai licence plates ‘precious as gold,’ says vice mayor from South China Morning Post []
  4. Used car sales are increasing faster than new car sales on the mainland and may be an opportunity for foreign auto dealers with experience in this segment.  4.8 million used cars were sold in China in 2012 compared with 15.5 million new cars.  Used car sales are expected to double to 10 million in the next three years.  For comparison, in the US the used car market is four times the size of new cars.  See Coming of age: China’s used car market outpaces new sales growth from Reuters []
  5. China to surpass US as top luxury car market: study from Agence France-Presse []
  6. China Vehicle Population Hits 240 Million as Smog Engulfs Cities from Bloomberg []
  7. ‘Imported From Detroit’ Is a Good Idea in China, if Only… from The Wall Street Journal []
  8. Modern facilities, global reach for Jaguar Land Rover from China Daily []
  9. Many other luxury cars continue to sell well on the mainland.  For example, in 2011 Chinese consumers overtook the US in purchases of Rolls Royce vehicles; although in 2012 US consumers retook the “torch” which may again be handed off in 2013.  See U.S. Overtakes China as World’s No. 1 Buyer of Rolls-Royce from The Wall Street Journal []
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