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China’s Richest 2019: King Of Beverages Zong Qinghou Aims To Revitalize Wahaha

When Zong Qinghou travels abroad, he likes to visit local supermarkets. The 74-year-old founder of China’s largest privately held beverage company Hangzhou Wahaha Group isn’t shopping for himself, but doing a little firsthand market research. For example, when Zong visited Singapore in October, he bought boxes of fruit-flavored beer. Staff back in China then study these samples to see if they could be imported into China, or adapted to local tastes.

“Every new product can be used as a reference,” says Zong in an exclusive interview with Forbes Asia on the sidelines of the Forbes Global CEO conference last month in Singapore. Zong, who is chairman of Wahaha, is now under pressure to come up with fresh product ideas to rekindle consumer interest in his company, that he’s spent more than three decades running.

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The tycoon, who was China’s richest man in 2010, 2012 and 2013, saw Wahaha’s sales slide from 78 billion yuan ($11 billion) in 2013 to 46 billion yuan in 2017 before rebounding slightly to 47 billion yuan last year. His ownership of the company still gives him a fortune of $8.2 billion, but he is no longer No. 1, ranking instead as China’s 31st richest person.

One of the main reasons for the decline, say analysts, is that Wahaha hasn’t kept pace with changing consumer tastes in China. Unlike their parents’ generation who grew up drinking Wahaha’s cheap but tasty products such as bottled water and milk drinks costing less than 2 yuan, shoppers today want to spend more for something innovative and new. “Wahaha is still very price-focused, and hasn’t captured the trading-up trend as well as it could have,” says Mark Tanner, founder of Shanghai-based consultancy China Skinny.

A Chinese worker checks bottles of Wahaha purified water on the assembly line at a factory in... [+] Yichang city, central China's Hubei province.

Aly Song/Reuters/Newscom

Zong is unfazed. He vows to lift sales by at least 50% next year, to 70 billion yuan. While he concedes that Wahaha’s products was once perceived as cheap and old-fashioned, he says he’s working to modernize his products. The company, whose name is meant to mimic the sound of a child’s laugh, has recently started a major upgrade. Packaging has gotten a makeover to use brighter and more stylish colors, while ingredients like nuts and quinoa have been added to new yogurt lines to appeal to healthier lifestyles. Wahaha has also expanded into nutritional tablets and meal replacement biscuits, which Zong says are in line with dieting trends. He also plans to increase the current number of 6,000 distributors to 10,000 by year end, to ensure better distribution to every corner of China.

Yet perhaps the most notable change is Zong’s willingness to experiment with social media and e-commerce. In 2014, he famously pronounced at a conference that e-commerce was disrupting China’s “real economy.” The company as a result did not have much of an online presence, even as e-commerce exploded across China. “I don’t think traditional sales channels will change much,” Zong says. “People need to enjoy life, and to enjoy life, they need to go outside instead of staying at home hooked on their smartphones.”

Zong, in fact, still expects most sales to take place in traditional brick-and-mortar stores. That said, Wahaha has started to experiment with digital marketing for its products. A series of videos on the popular app TikTok app shows users posting 15-second clips of themselves pronouncing Wahaha in various humorous ways. The clips have been viewed almost one million times.

Some analysts hope Wahaha can do more of such efforts. Jason Yu, a Shanghai-based general manager at research firm Kantar Worldpanel says, “It is very hard to get consumer attention today, and if you want to do that, you have to engage and interact with them nonstop.”

For example, Wahaha’s competitor in bottled water, Nongfu Spring, has gained market share in part because of innovative advertising. One was a campaign where each bottle of Nongfu Spring water gave the buyer the right to cast one vote online for their favorite candidate in a popular TV talent competition show. Nongfu Spring was number one in China’s bottled water market in 2018, with an 11% share versus Wahaha’s 4% share, according to Euromonitor.

Zong’s ambitions, however, reach beyond China. He wants to start producing and selling Wahaha-branded yogurt and milk beverages overseas, after noticing that some Wahaha products are being exported by third-party traders. In the last few years, Zong has visited Southeast Asia, and identified Indonesia and Vietnam as two locations for factories to produce for local markets. Zong says, however, he wants to find the right local partner first before he moves forward with any overseas expansion.

China, he says, will always be Wahaha’s biggest market. Consumption will continue to grow, he says, as the middle class expands and spends on everything from education to travel. “If we can firmly establish ourselves in this market of 1.4 billion people, we can grow very big,” he says.

Don’t discount Zong. He has overcome many challenges in his long career. The entrepreneur didn’t venture into business until 1987, when he was already in his 40s. He started by selling snacks out of a canteen inside a local school in his native Hangzhou, then start producing and distributing milk. In 1988, Zong launched a nutritional drink for children, which became a national hit. Three years later, he acquired a state-owned factory, with sales reaching 400 million yuan the following year.

One of his biggest challenges was a tumultuous partnership started in 1996 with France’s food and beverage giant Danone. After initial success, the two had a falling out, and Zong eventually agreed in 2009 to buy out Danone’s 51% stake in their various ventures for an undisclosed price, although one media outlet put it at roughly $380 million. “Only cooperation based on mutual benefits and mutual respect can last,” he says of the former partnership.

Then in September 2013, he faced another challenge when he was attacked by a knife-wielding man, disgruntled after Zong turned him down for a job. The attacker managed to cut the tendons and muscle on two of Zong’s fingers, but he was back at work just a few days later.

Another big challenge is succession. Zong’s management style is famously budget-conscious and detail-oriented. He often eats at the company canteen with staff, and is known to fly economy class. He personally approves the purchase of all new company cars.

Naturally, Zong has long been looking at his only child, daughter Kelly Zong, to replace him. She’s had plenty of experience, working at Wahaha since 2004. Now 37, the younger Zong has also tried her hand at entrepreneurship, launching a juice brand, KellyOne, three years ago. In 2017, she attempted to acquire the Hong Kong-listed candy firm China Candy, but was unable to acquire 50% of the company’s voting rights. Kelly said in a social media post at the time that the unsuccessful bid had been a “positive and constructive exploration.”

Kelly Zong Fuli, daughter of Wahaha Groups Chairman Zong Qinghou.

Imagine China/Newscom

Zong says he will hand over the reins to Kelly if she wants them. If not, he will groom professional management. “A lot of young people have studied abroad and have a broader vision, and they may not want to manage their parent’s business,” he says. “My daughter is overseeing some factories. Does she want to take on more? That I don’t know.” His move to do digital marketing, led by younger talent, was seen as a positive step towards a new generation having a greater role in the company.

Zong says there is still time to find good professional managers if Kelly wants to follow her own path. He says Wahaha is considering several for future leadership, without going into detail. He is also not ruling out an IPO, a move that would be a major move for the company down the path of diversifying management.

Whatever path he takes, Zong is clearly thinking about laying the foundations of sustainable success for Wahaha.

This story is part of Forbes’ coverage of China’s Richest 2019. See the full list here

I am a Beijing-based writer covering China’s technology sector. I contribute to Forbes, and previously I freelanced for SCMP and Nikkei. Prior to Beijing, I spent six months as an intern at TIME magazine’s Hong Kong office. I am a graduate of the Medill School of Journalism, Northwestern University. Email: ywywyuewang@gmail.com Twitter: @yueyueyuewang

Source: China’s Richest 2019: King Of Beverages Zong Qinghou Aims To Revitalize Wahaha

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Zong Qinghou is the founder and chairman of Hangzhou Wahaha Group which is the leading beverage company in China. Zong was listed as China’s richest man in 2012. As an NPC deputy, Zong has submitted one motion and 12 suggestions this year. He said deputies have the responsibility to represent the ordinary people. CCTVNEWS reporter Su Yuting spoke with Zong to hear his opinion on China’s economic development. Subscribe us on Youtube: https://www.youtube.com/user/CCTVNEWS… Download for IOS: https://itunes.apple.com/us/app/cctvn… Download for Android: https://play.google.com/store/apps/de… Follow us on: Facebook: https://www.facebook.com/cctvnewschina Twitter: https://twitter.com/CCTVNEWS Google+: https://plus.google.com/+CCTVNEWSbeijing Tumblr: http://cctvnews.tumblr.com/ Weibo: http://weibo.com/cctvnewsbeijing

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Chinese E-Commerce Giants Report Booming Singles Day Sales

A big screen shows the online sales for e-commerce giant Alibaba surpassed RMB 100 billion or US14 billion at 01:03:59 after the Nov. 11 Tmall Shopping Festival started midnight in Shanghai, China Monday, Nov. 11, 2019. (Chinatopix Via AP)

(BEIJING) — Chinese e-commerce giants Alibaba and JD.com reported a total of more than $50 billion in sales on Monday in the first half of Singles Day, an annual marketing event that is the world’s busiest online shopping day.

Singles Day began as a joke holiday created by university students in the 1990s as an alternative to Valentine’s Day for people without romantic partners. It falls on Nov. 11 because the date is written with four singles — “11 11.”

Alibaba, the world’s biggest e-commerce brand by total sales volume, adopted the day as a sales tool a decade ago. Rivals including JD.com and Suning joined in, offering discounts on goods from smartphones to travel packages.

E-commerce has grown rapidly in China due to a lack of traditional retailing networks and government efforts to promote internet use. Alibaba, JD.com, Baidu and other internet giants have expanded into consumer finance, entertainment and offline retailing.

On Monday, online retailers offered discounts on goods from craft beer to TV sets to health care packages.

Alibaba said sales by merchants on its platforms totaled 188.8 billion yuan ($27 billion) between midnight and noon. JD.com, the biggest Chinese online direct retailer, said sales reached 165.8 billion yuan ($23.8 billion) by 9 a.m.

Electronics retailer Suning said sales passed 1 billion yuan ($160 million) in the first minute after midnight. Dangdang, an online book retailer, said it sold 6.8 million copies in the first hour.

Alibaba kicked off the event with a concert Sunday night by Taylor Swift at a Shanghai stadium.

Chinese online spending is growing faster than retail overall but is weakening as economic growth slows and consumers, jittery about Beijing’s tariff war with Washington and possible losses, put off big purchases.

Online sales of goods rose 16.8% over a year earlier in the first nine months of 2019 to 5.8 trillion yuan ($825 billion), according to government data. That accounted for 19.5% of total consumer spending. Growth was down from an annual average of about 30% in recent years.

By JOE McDONALD

Source: Chinese E-Commerce Giants Report Booming Singles Day Sales

993K subscribers
Nov.11 was Singles’ Day in China, the country’s busiest online shopping day of the year. More than 35 billion RMB was spent on two online platforms, Tmall.com and Taobao.com, which are owned by China’s e-commerce giant Alibaba. A total of 170 million transactions were made during the day.

With Currency Manipulator Label, China Trade War Moves Into Unchartered Waters

Last week’s announcement by Trump of more tariffs coming for everything shipped to the U.S. from China and Monday’s move by Beijing to allow for a weaker yuan begins Act III in the trade war.

Here’s the plot twist:

Treasury just hit China with currency manipulator status after market hours on Monday. It came at a time when nothing was trading. Investors were stuck in the Twilight Zone. Tuesday morning is going to be a madhouse rush for “sell China” orders by the algos. Wait for it.

As one hedge fund manager told me, “we’ve just thrown gasoline on the fire.”

Currency manipulator status gives Beijing less wiggle room because if they weaken the yuan to make up for tariffs, tariffs will likely go up to compensate.

We are in unchartered waters. At risk is what amounts to sanctions on key U.S. commodities like soybeans and pork by the Chinese government, and political risk involving Hong Kong as civil unrest continues there, putting its special trade status in the crosshairs of a China-bashing American Congress.

President Trump told reporters last week that he figured China would depreciate the yuan in response to his plan to hike tariffs to 10% on the remaining balance of China imports by Sept 1.

In isolation, a 10% tariff on $300 billion in combination with a 10% yuan depreciation would be functionally equivalent to Chinese households writing a check for $30 billion to the U.S. Treasury. “Trump may not have gotten Mexico to pay for its border wall, but he is getting China to pay (the government) for its tariff wall,” says China bear Brian McCarthy, chief strategist for Macrolens, a big picture investment research firm.

Currency manipulator status makes the trade war worse for China.

Meaningful and enduring negative feedback about China will lead to extreme financial market volatility in Asia, especially in China’s mainland equity market where a gambler’s approach to trading by the dominant retailer investor class there might cash out. And why not? China’s mainland stock indexes are up over 20% this year and this may be seen as the time to take money off the table.

Short sellers shouldn’t discount the possibility of the People’s Bank of China pumping money into the A-shares this week.

It’s too early to start expecting widespread defaults on China’s corporate dollar-denominated debt (which some firms estimate to be around $800 billion). A default would deal a harsh blow to foreign investors who have been big buyers of Chinese bonds as that market opens up and joins the major indexes.

The transmission mechanism from yuan devaluation to global securities is expressed more obviously through Europe and other emerging markets, especially those heavily linked to China — such as South Korea and Brazil. Both currencies had an ugly looking chart on Monday.

Meanwhile, the Fed can potentially isolate the U.S. economy from any economic fallout by cutting rates. Though this opens up a whole other can of worms, namely rates sinking to zero in the event of a recession.

The yuan settled at 7.05 to the dollar today after the central bank set the daily rate at just over 6.9 to the dollar. The currency is allowed to trade within 4% of that daily fixed rate. The yuan is now at its weakest level in over 10 years.

“These moves represent a significant escalation in the trade war,” says Joseph Brusuelas, chief economist for RSM, a global financial advisory firm.

“There is a specific logic and order of operations with respect to the tit-for tat retaliation likely to play out that will not result in longer-term inflation, but will instead create conditions for deflation and negative nominal interest rates along the U.S. maturity spectrum if a longer-term trade compromise cannot be reached,” he says.

Follow me on Twitter or LinkedIn.

I’ve spent 20 years as a reporter for the best in the business, including as a Brazil-based staffer for WSJ. Since 2011, I focus on business and investing in the big emerging markets exclusively for Forbes. My work has appeared in The Boston Globe, The Nation, Salon and USA Today. Occasional BBC guest. Former holder of the FINRA Series 7 and 66. Doesn’t follow the herd.

Source: With Currency Manipulator Label, China Trade War Moves Into Unchartered Waters

Scary! Rising US-China Trade War Tensions Could Take 10% Off the S&P

Global markets continue to digest the impact of President Donald Trump’s Sunday evening tweetstorm. Meanwhile, analysts from some of the world’s biggest investment banks including UBS and Bank of America Merrill Lynch have detailed their forecasts for what a full-on trade war between the U.S. and China would look should the worst happen.

Among the many hair-raising projections is the prospect of the S&P 500 entering a correction by losing 10% of its value, which would almost certainly trigger a long-feared recession. That particular forecast was made by UBS analyst Keith Parker, according to CNBC. Parker specified that key European and American cyclical markets would bear the brunt of the declines.

S&P 500

| Source: Yahoo Finance

“FASTEN YOUR SEATBELT AND DON’T HOLD YOUR BREATH”

There is an old saying that when two elephants fight, it is the grass that suffers. In this case, both elephants will also sustain a significant amount of damage if Parker’s projections hold true. He predicts that a full-scale trade conflict between the world’s two biggest economies will see China shed anything from 1.2% to 1.5% of its GDP, which is equivalent to a drop of between $132 billion and $165 billion.

If China responds to Donald Trump’s threatened 25% tariff with a tariff increment of its own from 7% to 15% on approximately $60 billion worth of American imports, this could see the U.S. shed 0.1% of its GDP, or about $14 billion. In the ensuing scenario, Bank of America projects that China may hike tariffs on U.S.-made vehicles and reduce its soybean imports from the U.S. Meanwhile, Chinese imports of American soybeans have already fallen off a cliffsince 2017, dropping roughly 98% last year as China looks toward less antagonistic partners like Brazil.

According to a Bank of America report also cited by CNBC:

“Fasten your seatbelt and don’t hold your breath. The latest escalation of the trade war was completely unexpected, despite the strength of the economy and the markets. This is evident from the immediate negative reaction of U.S. equity futures to the news.”

As the two elephants knock heads, the amount they are erasing from each other’s economies is equivalent to the GDP of mid-sized nations. European and Asian economies will also feel some pain, according to UBS.

IS TRUMP BLUFFING?

According to the White House, the new 25% tariff regime that could potentially kick off this entire sequence of events will come into effect just after midnight on Friday. Expectedly, markets have been in virtual freefall since Monday, with the NASDAQ and S&P 500 both shedding close to 1% on Monday alone. The miserable market conditions continued through Tuesday, with little sign of respite as investors react with horror at the thought of a damaging 20th-century-style trade conflict between economic superpowers.

Dow

The Dow Jones Industrial Average continues to trend downward following Sunday evening’s shock announcement. | Source: Yahoo Finance

Not everyone believes that the panic is warranted, however. JPMorgan CEO Jamie Dimon, for example, believes that the shock announcement by Trump was nothing more than a way of cornering a formidable opponent and forcing them to negotiate. Speaking to CNN Money’s Poppy Harlow, Dimon stated that regardless of the market’s reaction, Trump will count it as a win because it has become the only successful way of getting the Chinese to the negotiating table on his terms.

Whether this is a considered masterstroke of strategy or simply a typical Trump action, it certainly appears to have done the trick. Chinese Vice Vice Premier Liu He will be part of a trade delegation to the U.S. later in the week, which at the very least is a sign that China is willing to give ground so as to avoid a damaging trade war.

Source: Scary! Rising US-China Trade War Tensions Could Take 10% Off the S&P

Southeast Asian Business Leaders Must Step Up On Development

Consider two statistics about Indonesia: Economists forecast the country will become the world’s fourth-largest economy by 2050. We also have the world’s highest burden of tuberculosis after India, claiming the lives of 150,000 to 200,000 people every year.

These figures illustrate the extreme inequalities dogging the world’s fourth-most populous nation, despite impressive economic growth in the last decade and cutting poverty by half.

In Jakarta and other main cities, a burgeoning middle class is drawing local and international investors, from vehicle companies to financial services to digital technology to retail and fast food chains. Yet tuberculosis still affects far too many people, particularly poor people suffering from malnutrition, while malaria remains a major problem in the remote, heavily forested province of Papua in eastern Indonesia.

To achieve its full potential, Indonesia needs to tackle inequality by investing more in its people. According to the World Bank, growth has primarily benefited the richest 20% and left the remaining 80% of the population–about 205 million people–behind.

As the Bank’s Human Capital Project points out, education and health are two of the best ways to support prosperity and prepare countries for the economy of the future. With education you can change the fate of a country, but better health is central to human well-being. Healthy people live longer lives, are more productive and save more.

I was born into a working-class family at a time (the 1950s) when most families in Indonesia had no access to healthcare. Thousands of children died each year from preventable diseases such as measles, polio and malaria. My father had a business making pedicabs, while my mother ran a fabric shop in the city. When I became an entrepreneur, I felt compelled to give back to Indonesia. Philanthropy is not about making a donation. It is a commitment related to continuity and sustainability, and requires a well-planned system to have impact.

Since 2015, the Tahir Foundation has partnered with the Bill & Melinda Gates Foundation and the Global Fund to Fight AIDS, Tuberculosis and Malaria, which have played a key role in reversing the course of these epidemics around the word. In Indonesia, the partnership’s efforts are paying off: TB mortality rates have fallen by 44% and TB incidence was down by 14% from 2000 to 2017, thanks to improved case finding and better diagnostics. In 2017, more than half of Indonesia’s districts were officially declared malaria free–a major feat for a diverse archipelago of more than 17,000 islands and more than 300 ethnic groups.

Still, more robust investments are needed. Tuberculosis places a huge social and financial burden on the people who have the disease, as well as on their families and communities. Most of the infections occur in people at their most productive age, draining billions of dollars in loss of productivity due to premature death and medical costs.

I hold the conviction that the private sector and business leaders have an important role to play in public health and development in emerging economies in Southeast Asia, many of which share similar challenges and opportunities. The private sector can bring not only funding, but technical expertise, creativity, and innovation, and are often well positioned to drive policy change.

The government of my country has done a lot for public health, including rolling out a universal health insurance scheme that is designed to provide a wide range of services from maternal care to heart surgery for its entire population by the end of 2019. But the private sector can fill the gaps to complement public resources by expanding access so that all Indonesians benefit from better health.

In 2014, a coalition of Indonesian business leaders, in partnership with the Bill & Melinda Gates Foundation, came together to create the Indonesia Health Fund, a significant step toward making Indonesia self-reliant in health funding and a model for philanthropic collaboration in the region. Over the past four years, the fund has contributed to family planning programs, TB research and advocacy programs, as well as TB screenings

It shows what can happen when public and private sectors come together with a common aim. It is more important than ever with the Global Fund now calling on the world to step up the fight against HIV, TB and malaria in the face of new threats from all three diseases. Raising their target of at least $14 billion will help save 16 million lives over the next three years, avert 234 million new cases and infections, and help us get back on track to end these diseases. The fund is calling on the private sector to contribute at least $1 billion of this total. So let us all do our share.

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Doctor Yulismar checks the condition of a patient who has tuberculosis bacteria at the Indonesian Association Against Tuberculosis (PPTI) clinic in Jakarta, Indonesia, on March 24, 2016. (Photo: Jefri Tarigan/Anadolu Agency/Getty Images)

Disclosure: Dr. Tahir is the owner of the license to publish Forbes Indonesia magazine.

Source: Southeast Asian Business Leaders Must Step Up On Development

Job Cuts And No More Snacks: China’s Internet Companies Brace For Slowest Growth In Years

Peolple walk past a sign for Chinese ride-hailing service Didi Chuxing (AP Photo/Mark Schiefelbein)

Job losses and other cost-cutting measures are beginning to emerge from China’s once unbeatable internet sector.

Games operator NetEase, ride-sharing giant Didi Chuxing and e-commerce firm JD.com are reportedly cutting jobs and reducing employee perks amid faltering growth in the wider economy and increasing regulation of China’s internet companies.

“No matter its Didi, NetEase or JD.com, the only reason for them to do this is business performance pressure,” says Zhang Yi, founder of Guangzhou-based consultancy iiMedia Group. “Their old businesses are fraught with uncertainties, while the new business lines haven’t taken off. It is inevitable to have cut jobs during this process.”

The number of jobs vacancies at China’s internet companies declined 20% in the final quarter of 2018 from a year earlier, according to Zhaopin.com, a Beijing-based recruitment firm. And analysts are expecting to see further pressure down the road, as more internet companies grapple with the country’s sputtering economy.

More On ForbesChina’s Didi Cuts 2,000 Jobs In Business Restructuring

Didi Chuxing is a case in point. Once touted as a national champion that drove Uber out of China in 2016, the company is now cutting 15% of its workforce, or about 2,000 employees. Also gone are the free snacks and complimentary yoga sessions that employees had once enjoyed, as the company reportedly seeks to stem mounting losses. Regulators have been scrutinizing its ride-sharing service following a series of passenger safety scandals. Didi has since issued a public apology, while installing safety measures such as in-app police assistance and sharing vehicle routes with friends and family members. The company is now betting on an international expansion plan as a catalyst for new growth, and says that it intends to hire more people to support that effort.

Other companies have been rolling out new strategies to cope with the challenges. A NetEase spokesperson said the company is “optimizing its structure to stay more focused,” but would not confirm local media reports of “wide-scale layoffs” at its e-commerce, public relations and farming units. Like the rest of the gaming industry, NetEase has to contend with a regulator that has been slow to approve new titles following a 10-month suspension of new licenses in 2018.

Billionaire Richard Liu, founder and CEO of JD.com Inc. (Photo: Billy H.C. Kwok/Bloomberg)© 2017 Bloomberg Finance LP

Meanwhile, a spokesman for JD.com declined to comment on reports that it was in the process of cutting 10% of its senior ranks. Instead, China’s second-largest e-commerce site said it would be hiring 15,000 new employees primarily for entry-level positions at its logistics and customer service units. JD.com’s growth in active customers slowed to 4% in the final quarter of last year, down from 15% in the previous quarter, as competitors like budget shopping service Pinduoduo continued to grab a larger share of the market.

To be sure, not all of China’s internet firms are cutting back. Alibaba’s CEO Daniel Zhang vowed not to lay off any staff this year, stating in a  post on China’s Twitter-equivalent Weibo: “When the economy is bad, the biggest advantage for online platforms is to create jobs.”

More On ForbesThe Reality Of China’s Economic Slowdown

Compounding the challenges faced by China’s internet companies is a slowdown in consumer spending. Beijing is now targeting economic growth of between 6% and 6.5% this year, marking the slowest growth in almost three decades, as government and corporate debt mounts and trade tensions with the U.S. have depressed manufacturing output and consumer sentiment. With China also trying to curb risky funding to reduce financial risks, capital flows to investment funds has been slowing. Private equity firms raised 1.01 trillion yuan ($149 billion) last year, falling almost 30% from 2017, according to Beijing-based research firm Zero2IPO Research.

This means there is less funding available for China’s smaller startups, which are now struggling as investors grow increasingly cautious. “A lot of startups can’t raise money, so they have to cut headcounts,” says Ken Xu, a partner at Shanghai-based investment firm Gobi Partners.

Aware of such struggles, Chinese policymakers recently announced as much as 2 trillion yuan ($298 billion) in corporate tax cuts, and told local banks to grant more loans to private enterprises. But analysts say it remains to be seen if Beijing’s stimulus measures will bring about enough changes as the details still have yet to be clarified.

“They will be helpful, but whether the impact will be as big as people think is a matter of debate,” says Cui Ernan, an analyst at Beijing-based research firm Gavekal Dragonomics. “The job market is likely to remain weak in the first half this year before recovering a bit in the second half.”

Follow me on Twitter @yueyueyuewang

Source: Job Cuts And No More Snacks: China’s Internet Companies Brace For Slowest Growth In Years

China Stops Buying U.S. Oil, Two Months After Record Total – Ken Roberts

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China has turned off the U.S. oil spigot. A response to the full-on trade war between the United States and China, it is a both a stunning turn-around, coming just two months after record exports there, and a stark reminder of the difference between what it means to live in a free country and one that is not. In 2017, China accounted for 20 percent of all U.S. oil exports. It played an out-sized role in the United States’ fastest-growing significant export and trailed only Canada for market share…….

Read more: https://www.forbes.com/sites/kenroberts/2018/10/18/china-stops-buying-u-s-oil-two-months-after-record-total/#2beb67655d00

 

 

 

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