Press Review

CAIJING

China’s Population Challenges

May 9

Results of last November’s nationwide population census show that China’s fertility， mortality and population growth rates are all low， which will create challenges for the country’s economy in the future. China’s aging population has been a widely discussed issue. The ratio of the number of people aged 20 to 59 to that of people older than 60 was 5.5 to 1 in 2000. This ratio was 4.8 to 1 in 2010， and it is forecasted to be 2.1 to 1 by 2030. This means the country’s labor force is shrinking， slowing economic growth. The graying of the population also presents a challenge for the country’s social services and social insurance infrastructure.

CHINA ENTREPRENEUR

HTC’s Cher Wang Named World’s Most Powerful Technology Executive

May 5

The New York Times named Cher Wang (王雪紅)， co-founder and chairperson of HTC Corporation (宏達電)， the most powerful female executive in the global technology industry. The market value of her company has grown by 3，000% in the past five years to reach USD 31.9 billion， overtaking Nokia， RIM and SONY. The 52-year-old is the daughter of Taiwan’s richest man， Wang Yongqing (王永慶). Goldman Sachs forecasts HTC’s shipment volume of handsets and tablet computers to be 200 million and 30 million units respectively within the next three to five years， and that the company’s valuation will increase to USD 100 billion.

GLOBAL ENTREPRENEUR

A Good Year for China’s MA Market

May 5

Merger and acquisition (MA) activity in China is heating up this year， with 41 cross-border mergers and acquisitions reportedly done in the first quarter. The total value of transactions made is USD 8.328 billion according to Zero2IPO (清科咨詢)， which is a year-on-year increase of 257.4%. Chinese companies have been especially active in exploring acquisitions of foreign companies in the natural resources sector， while foreign companies have been eager to expand into the Chinese market. The number of mergers and acquisitions of Chinese companies by foreign investors increased by 32% in 2010 and is expected to grow rapidly this year， according to PricewaterhouseCoopers.

SANLIAN LIFE WEEKLY

Cooking Naturally

May 9

The industrialization of the food industry has increased supply， choice and convenience for the mass population. It also means that food additives are added to many products – in China there are almost 2，000 food additives in 22 categories that authorities consider acceptable. China produced 5.24 million tons of food additives in 2007， with a sales volume of RMB 52.9 billion (USD 8.14 billion). A recent report shows that the average person in China consumes around 10 grams and 60 to 70 different food additives every day， and there has been an increase in reported cases of illegal additives being consumed by people in the country. Consumers are becoming more concerned about the risks of additives in processed foods， but the only way to avoid them completely is to prepare food at home with organic produce.

Blogtalk

The harm from a large increase in China’s foreign exchange reserves will far outweigh the benefits.

Yu Fenghui (余豐慧)， independent economist

http://blog.sina.com.cn/yufenghu

China’s economy faces great risks right now， but it isn’t going to collapse.

Ye Tan (葉檀)， National Business Daily columnist

http://blog.sina.com.cn/yetan

China should not loosen macro-controls on the finance and banking sectors this year.

Guo Tianyong (郭田勇)， director of the Research Center of the Chinese Banking Industry， Central University of Finance and Economics

http://blog.sina.com.cn/guotianyong

Many signs indicate a downturn in the growth of the Chinese economy.

Tao Dong (陶冬)， Credit Suisse’s Chief Asia Economist

http://blog.sina.com.cn/taodong

CHINA BUSINESS NEWS

Chinese Withdraw Bank Savings

May 13

Though China’s regulators have been raising interest rates and banks’ deposit reserve ratios in a bid to curb inflation， there was a net outflow in consumer bank deposits totaling RMB 467.8 billion (USD 71.98 billion) according to the central bank. The rising Consumer Price Index and negative interest rates on consumer deposits are leading consumers to withdraw their money from savings accounts. It is expected that this will lead to hundreds of billions of RMB to flow into other places， including other bank financial products， debit and credit products， treasury bonds and property investments.

THE ECONOMIC OBSERVER

China’s Auto Industry Hits the Brakes

May 9

Analysts expect China’s auto industry will have a difficult time maintaining its explosive growth this year. Last year the sector grew by 32%. Growth in production and sales of vehicles in the country was only 5.09% and 5.95% respectively in the first four months of this year. 6.4 million vehicles were produced between January and April this year， a 58.71% decrease compared to the same period last year， and 6.5 million vehicles were sold， a decrease of 54.56%. The month of April was especially slow this year， with negative growth reported for the first time in 27 months. The reasons for the slowdown include a wind-down of government stimulus policies， implementation of restrictions on new registrations in Beijing， and rising gas prices and parking fees in first-tier cities.

21ST CENTURY BUSINESS HERALD

Shenzhen is not China’s Future PE Capital

May 9

When the first Chinese private equity companies were established in 2003， all were headquartered in Shenzhen， making that city the private equity capital of the country. However， since then， Shanghai and Beijing have become more competitive in attracting such firms. There were 77 registered in Shanghai and only 44 in Shenzhen in 2008. By April of this year， private equity companies in Shanghai， Beijing and Shenzhen numbered 194， 102 and 95 respectively， a three-year increase of 152%， 500% and 115%. Additionally， companies registered in Shanghai and Beijing have been outperforming those registered in Shenzhen.