Anti-dumping duties removed， Chinese shoemakers eye EU high-end marketWENZHOU， Zhejiang， April 20 — Since the European Union (EU) erased anti-dumping duties， shoemakers in east China’s Zhejiang Province have shifted from a low-cost strategy to target the high-end EU market.Aokang Group Co.， Ltd.， one of 1，200 Chinese companies affected by the tariffs， is abandoning its low-cost strategy and forging ahead on a new path to avoid being involved in a new round of trade frictions with the EU.Based in Wenzhou， the shoe-manufacturing export hub in east China’s Zhejiang Province， Aokang Group， one of China’s leading shoemakers， experienced both the rise and fall of shoe exports over the past several years.In October 2006， the EU imposed a two-year 16.5 percent anti-dumping tariff on imports of Chinese leather shoes.These measures were introduced in response to Asian footwear being sold below production cost in Europe. The policy was extended and remained in effect until March 31 this year.Prior to the anti-dumping measures， Aokang had once received an order for 1.5 million pairs of leather shoes from GEOX， a well-known Italian footwear brand. Later， the influence of the anti-dumping duties resulted in fewer orders from the buyer， according to Wang Zhentao， Chairman of the Aokang Group.“Since the end of the anti-dumping duties was announced by the European Commission last month， orders from GEOX have increased by about 70 percent in the first quarter of 2011 over the same period last year，” Wang said.“Twenty thousand pairs of leather shoes have recently been exported to Europe by Aokang，” Wang added.Xie Rongfang， head of the Wenzhou Shoe Industry Association， said that the export of leather shoes from Wenzhou will increase steadily by 10 to 20 percent.Since seeing its opportunity to return to the EU market， Aokang has raised both the quality and retail price of its products.Li Haiying， Distribution Manager of the Aokang Group， said that Aokang has started to select high-end orders from numerous European buyers rather than seek out new orders.“Those renowned European brands， like Sixty， Camel， and Wortmann， have shown great interest in cooperating with Aokang，” Li said. “We want to focus on some orders with high standards， otherwise， the export of our products will surge.”Kameiduo Group Co.， Ltd.， a leading supplier of women’s shoes with more than 3，000 employees in southwest China’s Sichuan Province， faces a similar situation.‘The end of the anti-dumping measures may bring some advantages， but we still have to look for more reliable outlets， like industry transformation，” Liu Ying， Assistant to the Chairman of Kameiduo Group， said.“Even if production is based in China’s far-western regions， the cost of shoe-making has continued to rise since 2008，” said Liu. “The low-cost strategy does not make any sense.”Liu said that Chinese shoemakers do not have their own name brands and outstanding designs， elements that are attractive to European consumers.His views are shared by Xu Yong， the Deputy Director of the China Light Industry Federation (CLIF).“The transformation of China’s shoe industry is inevitable. Shoes of good quality and exquisite design can be more competitive in the international market，” said Xu.Wei Yafei， a spokesman for the China Leather Industry Association (CLIA)， warned that the end of the antidumping duties should not mean domestic shoe-making enterprises can relax their vigilance. Wei says the EU could still consider a new round of footwear trade remedy investigations and protective measures.“Chinese shoemakers ought to study shoe-exporting regulations and raise the products’ quality and value added levels. Meanwhile， they have to strengthen cooperation and communication with European trade partners so as to make their products more popular in the European market，” said Wei. (Xinhua)China-Russia machinery and electronics trade sustains recovery momentumBEIJING， April 12 — The trade of machinery and electronic products between China and Russia has experienced momentum during the recovery after the global financial crisis， Zhang Yujing， head of the China Chamber of Commerce for Import and Export of Machinery and Electronic Products， said on Tuesday.He expected the bilateral trade of machinery and electronics to reach 30 billion U.S. dollars by the end of 2015.According to data from the chamber， China exported 13.51 billion U.S. dollars of machinery and electronic products to Russia last year， an increase of 85.1 percent over the previous year.In the first two months of this year， the bilateral trade of machinery and electronic equipment between China and Russia rose 56.7 percent from a year before to 2.38 billion yuan， Zhang said at a news conference.As the world’s second largest economy， China provides many opportunities for Russian companies， especially makers of high-tech machinery products， Zhang said.The two countries have room for bilateral cooperation in the machinery and electronics sectors， as both China and Russia developed quickly and their companies are highly complementary， he noted.Furthermore， Zhang added that China would continue to encourage competitive domestic companies to invest in Russia. (Xinhua)French carmaker PSA Peugeot Citroen steers toward 8 pct share in Chinese marketSHANGHAI， April 18 — French carmaker PSA Peugeot Citroen hopes to increase its share in the Chinese market to 8 percent by 2015， the company’s CEO Philippe Varin said Monday in Shanghai.The target is a step up from the company’s less than 4 percent market share in the world’s largest auto market last year.Of the desired market share， 5 percent is expected to be from PSA’s joint venture with Chinese carmaker Dongfeng Motor Co.， Ltd. and the remaining 3 percent will come from a new company formed jointly by PSA and China Changan Automobile Group， Varin said.PSA’s joint venture with Dongfeng sold about 376，000 vehicles in China last year.Varin said the venture with Changan is awaiting the Chinese government’s final approval.PSA and Changan signed a deal for a 50-50 manufacturing joint venture in July 2010 with an initial investment of 8.4 billion yuan (1.29 billion U.S. dollars). The new plant will have a production capacity of 200，000 vehicles and 200，000 engines.China has become the second largest market for PSA products， he said.In a move that shows China’s importance to PSA， the company unveiled its new DS5 premium five-seat car on Monday， which will be the first model of the coming new venture. (Xinhua)China studies US$13b investment in Spain banksMADRID — Chinese investors including the country’s sovereign wealth fund may inject US$13 billion into Spanish banks， a government source said on April 13 after Spain’s premier met financial authorities in Beijing.There was no immediate comment from Beijing and it was not clear what terms would make the risk attractive to China， which has invested cautiously in overseas financial markets in the last couple of years.Concerns about delays in recapitalizing Spain’s ailing savings banks — heavily exposed to bad loans from a burst property bubble — have overshadowed the euro zone state’s efforts to convince markets it will not need a bailout.According to official estimates the savings banks — which are known as cajas and hold about half the deposits in Spain’s financial system — need about 15 billion euros in fresh funding to meet strict new financial targets.But private estimates go eight times higher than that when taking into account future losses from real estate writedowns.Spanish Prime Minister Jose Luis Rodriguez Zapatero is visiting China and Singapore this week， meeting with officials and fund managers to persuade them that Spain’s sovereign bonds and its financial system are a good investment.Speaking by telephone from Beijing， the Spanish government source told Reuters that Chinese sovereign wealth fund China Investment Corporation was studying an investment of $9 billion， and that private entities might add an additional $4 billion.China is looking at two possible investment structures， either investing directly in specific cajas， or savings banks， or creating a general fund that the cajas would be able to tap， another Spanish government source told Reuters in Beijing.“If this is true it is positive for the market. If CITIC or another Chinese vehicle invests 9 billion euros that would represent around 5 percent of the equity in the Spanish banking system，” said a London-based analyst who asked not to be named.“I wonder if some of this is to buy banks’ or cajas’ debt， in which case the impact gets diluted.”Doubts about the cajasSpain’s borrowing costs have soared in the past year and a half due to concerns about its large deficit， but some confidence has returned as Zapatero has cut spending and pursued the consolidation and recapitalization of the savings banks.But while Qatar and United Arab Emirates sovereign wealth funds intend to invest 450 million euros in the cajas， private investors who have looked at the books say they will only invest at a steep discount， due to doubts about the scale of overall losses.In recent weeks one merger of four savings banks fell apart， and two financial entities have indicated they need more capital than originally thought.Spain’s central bank is scheduled to report on Thursday which recapitalization plans it approves from the cajas it deemed to be short of capital. Zapatero met on Wednesday morning in Beijing with representatives from China Investment Corporation; top Chinese financial conglomerate CITIC Group; China’s banking regulatory commission and other entities.Dean Tenerelli， a fund manager at T Rowe Price International， said Chinese interest would be strategic rather than seeking returns.“There are two reasons behind China’s investment interest. Firstly political， in terms of strengthening links with Western Europe and spreading their vast wealth around. Secondly， they like to study how foreign countries and companies are run. Spain has a reasonably efficient banking system so they can learn from that，” Tenerelli said. (Xinhua)
