A wide variety of news over the past week, I think the biggest business opportunity listed below is with elderly care and “old age” homes. But that would probably be at the top of the market segment because most cannot afford it (even if they can culturally accept it).
Thanks to Kevin S and Sinocism for many of the links:
- Another Massive Photoshop Fail in China from Foreign Policy
- Girls, Girls, Girls: Alibaba’s Play for Mobile ‘Losers’ from The Wall Street Journal
- The coveted government jobs no one in China wants from South China Morning Post
- China Won’t Lose Its ‘Voice’ Despite New TV Restrictions from The Wall Street Journal (the policy makers can ban all they want, but the demand is still there and those looking for alternative will find it, likely online)
- With tough market at home, China’s heavy gear makers gain traction overseas from Reuters
- The Chinese Are In Love With Bitcoin And It’s Driving The Digital Currency’s Prices Into The Stratosphere from Business Insider (what about hong bao?)
- Beijing to Tackle Lack of Affordable Homes as Prices Soar from The Wall Street Journal (won’t work due to supply, demand and the interaction of subsidies)
- Media giant comes of age from China Daily
- China’s Baidu hiring in Thailand ahead of search engine expansion from Tech In Asia (how about fix your search engine so it can perform useful searches in English?)
- Chinese censorship goes global from The Economist
- Foreign Hedge Funds Warm to China from The Wall Street Journal
- Western Retailers See Online as Ticket to China from The Wall Street Journal
- Norway snub shows sharp edge of Chinese diplomacy from Associated Press (collectivism writ large)
- Human zoos and disappearing languages: The plight of China’s minorities from CNN
- Spike in divorces linked to tax loopholey from China Daily (i know of a few couples that have done this, is quite common in big cities)
- Chinese Show Global Real-Estate Appetite from The Wall Street Journal
- Caixin Explains: The Capital’s New Housing Rules from Caixin (paywalled)
- International students in China hit record high from Xinhua (A total of 328,330 international students from 200 countries and regions studied in China in 2012, up 12.2 percent than 2011, according to the Ministry of Education on Thursday.)
- Tencent Has Invested $2 bn in Overseas Markets from Tech Node
- Duty exemptions for Shanghai FTZ imported equipment from Xinhua
- China’s influence over the media growing globally, says US think tank from South China Morning Post
- Is China Saying Goodbye to ‘Hello’? from Foreign Policy
- Li Na seeks more history in Istanbul semifinals from CNN
- Chinese doctor stabbed to death in latest hospital attack from Reuters (one of the worst professions in China for sure. a different stabbing occurred in Forbidden Palace recently too.)
- Experts: Yangtze ecology collapses from China.org.cn
- China Property Firms See New Market in Old Age Homes from The Wall Street Journal (huge opportunity for decades to come)
- Demand drives soybean imports from China Daily
- China’s Official Local Debt Could Exceed CNY14Trl, Some Hidden Debt Excluded from Caijing (that’s roughly $2.3 trillion)
- Report: only 13% of Chinese consumers will buy smartphones priced over $330 from Tech In Asia (very few can currently afford top shelf Samsung or Apple models)
- In China There’s Not One City Without Terrifying Stretches Of Empty Houses from Forbes (my apartment complex has 2 entire (new) buildings that have laid vacant for this past year)
- Shanda Jumps Into China’s Online Payments Sector from China Tech News (they do everything now it seems)
Several interesting stories, including a nugget about upcoming college entrance requirements and the removal of English as a requirement (see the Xinhua story below). According to that story is this stat:
The Ministry of Education says that there are 50,000 companies specializing in English training, with the value of the market estimated at 30 billion yuan (almost 5 billion U.S. dollars).
Thanks to James M and Sinocism for some of the links:
- Is the Shanghai Tower the world’s first eco-friendly skyscraper? from China Dialogue
- Macau’s best casinos: Where to gamble, where to let loose from CNN
- Has China’s Debt Crisis Moment Arrived? from The Wall Street Journal (no, they’re going to bail them out even though it will cause even more long-term problems)
- English worth less in Beijing’s admission tests from Xinhua (could be a big game changer for the EFL industry here)
- Author: In China, ‘everyone is guilty of corruption’ from CNN (mostly true, especially outside of large cities)
- ‘When India and China Shake Hands’ from The Wall Street Journal (signed 9 agreements)
- In China, victory for wildlife conservation as citizens persuaded to give up shark fin soup from The Washington Post
- How the Chinese Learned to Embrace Independent Travel from The Atlantic
- China creates 50 bln tonnes of rain annually from Global Times
- Hollywood must think bigger about China, says producer Janet Yang from Reuters
- Xi urges overseas-educated talent to pursue Chinese dream from Xinhua (In 1978, China expanded the number of students sent to study abroad. By the end of 2012, 2.64 million had been sent abroad, among whom 1.09 million returned.)
- FTZ ‘Negative List’ Positively Disappoints Analysts from Caixin
- China: A place to call home from Financial Times (will have the same economic problems that all subsidized housing problems do across the globe, should just sell them on the open market)
- China Pushes Genetically Modified Food from The Wall Street Journal (so much fearmongering over GMO based on emotions rather than facts)
- China’s Internet Retail Sales Reached CNY1.3 Trillion from China Tech News (first 9 months of the year equals the total of all 2012)
- Report: Chinese Censorship Expanding Abroad from The Wall Street Journal
Over the past few days I’ve had talks with a couple of business people regarding EFL opportunities in China. While there are still many (see Chapter 9), I think entrepreneurs should be aware that there is global demand for this language.
Several years ago Jay Walker gave a short TED presentation that highlights the fact that there are around 2 billion English learners globally now. While he doesn’t cite sources he probably drew it from the British Council which publishes a similar number on its website (or perhaps it was from research done by David Graddol).
For more information about teaching and demand, be sure to check out Dave’s ESL and Angelina’s ESL.
I’ve discussed BTC and cryptocurrencies and their adoption in China before (here), time for a quick update.
A local channel out here called International Channel Shanghai (ICS) recently broadcast an English-based profile of BTC (and LTC) on its program called Money Talks (click here to watch it).
Overall its a fairly in-depth and accurate explanation of Bitcoin and doesn’t really devolve too much into scaremongering (though it does talk about all of the risks/regulations in the US and elsewhere).
According to the show there are now 14 exchange sites on the mainland that have been set up in the past 2 years (the two it mentions are BTCChina and 796.com).
The show found a professor (Yang Qing) at Fudan here in Shanghai who thinks that the government will be hands off for now because the overall market is very small.
They also interviewed another professor who errs as to why Bitcoin is not money: because there is no physical army backing it up.
Again, it is about 20 minutes and does a decent job of presenting it to the audience without fearmongering. (FWIW, Bobby Lee, the CEO of BTCChina is the brother of Charles Lee, the creator of LTC who is over at Coinbase now, see this recent Wired profile on him). Lastly, Jesús Huerta de Soto is name dropped at the end; for those of you unfamiliar with him, he’s an economist who has written a number of books on banking policies, credit and finance.
Some opportunities around for real estate developers in the new free trade zone being developed in Shanghai. And if you manufacture air filters, the northern areas (especially Dongbei) would probably have a lot of potential customers (see these photos). Thanks to Angela X and Sinocism for some of the links.
- Mistress-Driven Anticorruption: Study Says 15% of Accusers Are Lovers from The Wall Street Journal
- Q&A: Nate Silver on China and the New FiveThirtyEight from The Wall Street Journal (central planners and their statistics committees…)
- Xinhua, NDRC to set up price research institute from Xinhua (only in planned economy do you need to have statistics bureaus)
- Xinhua Insight: China’s Silicon Valley becoming Internet finance breeding ground from Xinhua
- CCTV: Chinese pay higher price for Starbucks coffee from Shanghai Daily (could be part of an image or brand marketing strategy by starbucks, i would wager this discovery does not phase most regular consumers)
- Shale gas sector gears up in China from China Daily
- What China can learn from Hong Kong in its fight against corruption from CNN (doubt it would work)
- Chinese couple sells babies for iPhones and shoes, authorities say from CNN (trending on weibo)
- Patti Austin cancels gig after Beijing asthma attack from BBC (horribad weather/air right now, see these recent pictures from Harbin and Shenyang.)
- Propaganda artists from North Korea paint a rose-tinted China from The Guardian
- Authors Accept Censors’ Rules to Sell in China from The New York Times
- Is it Too Soon for Xiaomi to Go Global? from Silicon Hutong (yes)
- Chinese authorities pull plug on ‘vulgar’ foreign-made TV from CNN (will simply push more people online, to view other cultural media on streaming video sites)
- China Seeks Clearer View of Government Debt Mountain from The Wall Street Journal
- Students Compete to Meet Powerful Alumni from China Buzz
- U.S. Businessman Accused of Being Mob Boss in China from TIME (hard to figure out one way or othe other)
- Pilot free trade zone in Shanghai to build open economy from East Asia Forum (i’ll believe it when i see it. i have a friend who works in real estate and they are planning projects in the new ftz.)
- Q&A: Huawei Executive Talks About Cyber Security from The Wall Street Journal (expects 10+ years to get into US institutions)
- Viral Chinese Cartoon Explains How to Become President from The Wall Street Journal (very naive view, filled with propaganda)
- Can Wuhan Become the Detroit of China? from The Wall Street Journal (i visited Wuhan once about 3 years ago, that’s what it looked like too — dusty and smoggy)
- Chinese Companies Fare Poorly on Transparency, Study Says from The Wall Street Journal
- China’s Building Cities So Fast, People Don’t Have Time to Move In from Gizmodo (this is the problem with inorganic urbanization by fiat, just because you build a city does not mean the people you want to move there have the productive means or ability to live and work there)
- China set to announce reforms of creaking pension system: sources from Reuters (probably worse underfunded than those in North America)
- British man sentenced for bigamy in Guangzhou from China.org.cn (unfortunately not a big surprise considering the cornucopia of laowai around)
- Xiaomi sells 100,000 MiPhone 3 units in 83 seconds from CNet (impossible to get unless you knew someone at the company, almost none of the “fans” were able to get phones during that first couple of minutes and are rallying on weibo about it. no inventory overhang at least.)
- India, China, Pakistan, Nigeria on slavery’s list of shame, says report from CNN (forced labor, black jails, etc.)
So much propaganda squeezed into 6 minutes. Nothing is mentioned about the powerful families, regional cliques or special interest groups that work behind the scenes to get their relatives or friends up the chain. Or the amount of bribery (hongbao) needed to initially obtain any position in government (the going price in small towns is 50,000 RMB).
According to Chasing the Chinese Tourist Yuan from The Wall Street Journal:
But in the aggregate, Chinese tourists have now passed Germans and Americans to become the biggest spenders abroad. About half of the 83 million Chinese who traveled outside the mainland in 2012 spent more than $5,000 per trip, according to British payment processor WorldPay.
Chinese authorities expect the number of travelers going overseas to hit 100 million next year. But that will still leave 93% of the population at home—potential travelers. The travel industry, hoping that the number of Chinese travelers keeps climbing, is preparing to serve the next wave.
A few stories from the past couple of days. The free-trade zone mania seems like a positive trend, here is hoping that the entire country is eventually turned into one free-trade zone instead of the hodge podge of a million fiefdoms. Thanks to Kevin S and Sinocism for some of the links.
If you want to run a standardized test taking center in Hong Kong or South Korea, you could probably make a bundle the next few years. Or if you know how to setup trust funds, you can probably help the “new” rich figure out how to emulate Western families and their wealth management strategies. Thanks to Sinocism for some of the links.
As I have told my younger Chinese friends who are looking to start their own sport companies, I recommend trying to get into sports that are very popular outside of China that are currently not popular here (e.g., Cricket, Rugby, Ice Hockey). See the Cricket story below. Thanks to James M and Sinocism for links.
This is a combination of news from the last two days as well as the first days of the summer. For those in the alternative education industry and training sector, there may be opportunities to tap into a growing customer base dissatisfied with the traditional education system (see links below). Also recommend reading that petro article from FT at the very bottom. Thanks to Matt L and James M for some of the links.
- Marlboro in the Middle Kingdom: Chinese Kids Know Their Smokes from The Wall Street Journal
- European Taxi Hire Service Expands To China from China Tech News
- China’s Software Industry Revenue Up 24.5% In H1 2013 from China Tech News
- TravelSky, Sugon Team For Big Data Aimed At China’s Travel Sector from China Tech News (travelsky is an SOE that has a monopoly over domestic bookings)
- A Freshman Year, Far From Home from The Chronicle of Higher Education
- China’s Higher Education Bubble from ChinaFile
- Some Chinese Students Stay Home to Get Ahead from The Wall Street Journal
- Education is Useless says penny-pinching Chinese father from The World of Chinese
- Is a college degree worthless in today’s China? from Offbeat China
- Millions at risk as China’s prosperity brings diabetes epidemic from The Independent (12% of population has diabetes)
- China ‘Catastrophe’ Hits 114 Million as Diabetes Spreads from Bloomberg
- Chinese No. 1 Li Na out of China Open from Xinhua (last couple months have been tough for her)
- Baijiu-Maker Kweichow Moutai Sobers Up from The Wall Street Journal (a complete u-turn in 1 year due in part to legal prerogatives from up top)
- Chinese Think Tank Puts Shadow Banking at 40% of GDP from The Wall Street Journal (see my friend describe alternative wealth management products)
- How Upstart Xiaomi Rattled China’s Smartphone Race from The Wall Street Journal
- China Food-Safety Woes Soar from The Wall Street Journal
- Huawei, CCTV Reach Big Data Cooperation For Chinese Media Storage from China Tech News
- In China, Avoiding The ‘Great Firewall’ Internet Censors from NPR
- Kingsoft Gained Net Profit Of CNY381 Million In H1 2013 from China Tech News (xiaomi founder worked at Kingsoft for over a decade before moving on, kingsoft is probably best known domestic software company)
- Why Chinese Have Shiny Nails After Visiting the Showroom from Bloomberg
- Why China’s Farms Are Failing from The Atlantic
- Rackspace Attempts To Take Back The China Internet Market from China Tech News
- Hey, big spenders from China Daily (chinese tourists abroad)
- PISA’s China Problem from The Brookings Institution (great post, PISA scores in 2009 that were reported only included Shanghai. an apples to apples should have been OECD cities, not entire countries)
- Asian Messaging Apps Challenge Silicon Valley from The Wall Street Journal
- Twitter and its plans for China from The Next Web
- Wooing China’s Princelings by Minxin Pei
- American Execs Say China is Getting Expensive, and Profitable from The Wall Street Journal (here is the full report)
- China raises hurdles for foreign banks from Financial Times
- Sip of Death Plagues Cancerous River Villages from Caixin (i used to live and work in Bengbu, which is bisected by the Huaihu. the college students i taught there would joke about throwing someone into the river because it was very dirty)
- The new gas guzzler from Financial Times (very interesting piece with some very detailed information and stats about the petroleum industry)
- Video: Inside China’s Social Media Platforms from The Wall Street Journal
Because the business news cycle was very slow in China this past summer, many of these links are a couple months old but their stories are very relevant today. A few stories involve other Asian countries. Special thanks to James M and Sinocism.
- KFC parent Yum warns of delay in China sales recovery from Reuters
- Young Chinese snubbing factory jobs, says billionaire boss from The Telegraph
- A new partnership to bring Coursera to the hundreds of millions of Chinese learners across the world from Coursera
- Tencent Jumps Deeper Into Chinese Internet Book Publishing from ChinaTechNews
- What Percent Are You in China? from The Wall Street Journal
- US failures could teach China’s automakers how to succeed from China Economic Review (i would wager that political and policy pressure allows local car manufactures to succeed, especially at the top, luxury level)
- China Cracks Down on Televised Singing Competitions from The Wall Street Journal (from this summer onward, still in effect)
- China urbanization cost could top $106 billion a year: think-tank from Reuters (i spoke with one financial expert here at the beginning of the year, he noted that if urbanization and reforming the hukou could be done, it would have been done already — costs are probably substantially higher than these estimates)
- Hollywood Studios Haven’t Been Paid by China in Months (Exclusive) from The Hollywood Reporter (have not heard if this has been cleared up, doubt it will be the last time that China Film Group tries to pass taxes onto others)
- Chandhok confident Indian GP will survive from CNN (not sure i’d want to attend with that air quality…)
- Bribery increases medicine prices by 20%: expert from China Daily (hongbao and maintaing guanxi)
- Bribery serves as life-support for Chinese hospitals from Reuters
- China to Audit Local Debts as It Cautions a Detroit-Like Crisis from Caijing (audits should also be audited)
- 60-70% of honey in Jinan is fake from Danwei (really have to be picky in terms of what you buy, even at grocery stores like CityShop)
- Soccer stars on treadmill to boost globalization drive from CNN (pretty cheap to play a simple game — just need some open space and a ball)
- Closer Look: Guangdong Officials Wisely Came Clean on Soil Pollution from Caixin (wont be the first or last time this happens in guangdong, let alone other provinces)
- One of the world’s most popular SF novels finally coming in English from io9 (talking about Three Body Problem by Liu Cixin)
- China’s Disappearing Official Problem from The Wall Street Journal (this was from the beginning of the summer, many more have disappeared in Chengdu during the recent world conference)
- SMEs’ Chronic Credit Crunch from The Economic Observer (this was from the past July, condition apparently has not improved much in the past quarter for SMEs, they dont have enough guanxi with SOE banks)
- Inner Mongolia Property Mogul Bites the Dust from Caixin (wasnt the first and wont be the last mogul due in part to the guanxi system)
- Hollywood’s Hope for Cash in China Blinds It to Censorship from The Wall Street Journal
- Chinese Directors Express Doubt Over Censorship Reforms from The Hollywood Reporter
- China is getting fatter: survey from China Daily
- China’s Higher Education Bubble from Caixin
- Chinese newborn, allegedly sold by doctor, is returned to parents from CNN (sadly quite common in rural areas still due to the OCP and the desire to have boys)
- Xiaomi Buddies Up With Tencent, Launches New Budget Smartphone For Just $129 from Tech In Asia (this is 3 months old but the Xiaomi-series of phones have been an instant success — great value for the price, the new Xiaomi 3 has fantastic specs for a paltry sum)
- Beijing reels in ‘unsafe’ air every other day from South China Morning Post (would not want to live there until <insert extremely long date>)
- North Korea: A sneak peek through the keyhole from CNN
- Could cricket have a big future in China? from BBC
- Guangzhou Nears Debt Red Line, Its Figures Show from Caixin (this is 3 months old too, heard it has not gotten any better, having to bail out local villages and SOEs)
- China starts 5-year ban on new gov’t buildings from Xinhua (i’ll believe it when i dont see it)
- In Paris, Chinese Shopping-Tour Buses Go Out of Fashion from The Wall Street Journal (could just be Paris but could be a challenge for everyone if SME growth doesnt pick up)
- Flurry: China Has 261 Million Active Smartphones And Tablets, 65% On Android from Tech In Asia (i bet the new numbers increase by ~10% over the past quarter)
- 4 decades after war ended, Agent Orange still ravaging Vietnamese from McClatchy
- Why is it so damn hard to understand China’s mobile market? Introducing the China App Index. from TechRice (if anecdotal evidence from my subway commute is any indication, top 5 are: some form of chat app, book app, casual game, movie and music apps)
- NFL Drives Deep Into Chinese Territory With Planned Online Store from Alizilla (been a couple months, wonder what the results have been)
- Foreign NGO registration rules eased from China Daily (still will be challenging environment to operate as a foreign NGO)
- Closer Look: SOEs Can Brag They Are Big – but Not Strong from Caixin
- China bars Glaxo exec from leaving country from CNN|Money (he still hasnt been able to leave)
- China’s Last Gunslingers from National Geographic
- Confinement Spa for New Mothers in China from PRI (very traditional)
- Jin Xing: China’s sex-change pioneer from CNN
- India to overtake U.S. on number of developers by 2017 from ComputerWorld (quantity over quality, or both?)
Mostly China-related news from the past couple of weeks. Special thanks to James M, Michael T and of course Sinocism.com.
I had lunch today with a former colleague of mine at the American Chamber of Commerce in Shanghai. He noted that after a lot of sweat and coding, the new SME Center site is up.
Based on my own interactions at the SME center (I had several friends that worked on the team over the past year), I highly recommend the information for entrepreneurs and managers of SMEs. Be sure to check out the FAQ section first.
In some non-China news, last month iRobot celebrated it’s 11th anniversary. DailyFinance published an interesting piece discussing the future of the company that makes Roomba, Scooba and other robots. Also, Engadget posted an interview with Colin Angle, the CEO regarding the past, present and future of the company. Hint: it will look a lot like Jude Law and Rosie the Robot than most people expected.
Bonus: SingularityHub has posted a couple videos of some rugged robots in development at Boston Dynamics.