China Market Intelligence

March 19th, 2008

As the curtains closed on the first session of the 11th National People's Congress (NPC) on Tuesday, legislators announced new leaders for top government posts, approved the government reorganization plan, and continued sideline discussions of policies that could affect foreign companies operating in China.

Key appointments

Xi Jinping, who was promoted to the Politburo Standing Committee of the Chinese Communist Party (CCP) in October 2007, was appointed vice...

March 19th, 2008

The US-China Business Council (USCBC) last week met with a PRC Ministry of Finance (MOF) advance team that visited Washington, DC, for Strategic Economic Dialogue (SED) preparatory meetings with its counterparts in the US Treasury Department and other executive agencies, and a meeting with congressional staff. USCBC emphasized the need to sustain an SED-type dialogue amid upcoming personnel transitions on both sides--the new roster of officials in China and the November elections in the...

March 19th, 2008
CURRENCY

The US Congress' two-week recess from March 17-28 is providing a respite from possible legislative action on matters related to China. Though China's currency policy remains the focus of a vocal group of House and Senate members, measures that deal with other aspects of the US-China commercial relationship are more likely to be considered in Congress this year. Bills on product safety (which CMI reported on last week), food safety, and Internet restrictions will have direct...

March 19th, 2008

As China's demand for energy soars, investment in the PRC energy sector will remain strong in 2008. Beijing's desire to create a more diversified and sustainable energy supply mix is driving accelerated investment in nuclear and alternative energy, even as investors finance numerous fossil fuel projects. Power shortages in south and east China earlier this year, however, demonstrated that China's energy sector still faces serious administrative, transport, and cost challenges.

Keeping...
March 12th, 2008

The first week of the inaugural 11th National People's Congress (NPC) session in Beijing featured the unveiling of a much anticipated plan to restructure ministries  under China's cabinet, a flurry of annual work reports that review the government's accomplishments and set future goals, and extensive discussion of China's economic and spending priorities. Key government appointments will take place during the second week of the session, with the announcement of the president, premiers, and...

March 12th, 2008

PRC legislators on March 11 unveiled a draft plan to streamline parts of China's administrative structure by consolidating certain regulatory functions. Changes described in two key documents, the State Council Organization Draft Reform Plan and the Opinion on Deepening Reform of the Administrative System, would create five new ministries under the State Council, China's cabinet. The most significant developments include the following, with the new ministries and commissions' names in bold...

March 12th, 2008

All US states have significantly increased their exports to China since 2000, but some--such as Michigan, Ohio, and Pennsylvania--have been more successful than others, according to a new US-China Business Council (USCBC) report. All three states exported more than $1 billion to China last year, and have had triple-digit growth in exports to China since 2000.

Overall, China now is the third-largest purchaser of US goods and services, behind only Canada and Mexico. US exports to China...

March 12th, 2008

Legislation to reform the Consumer Product Safety Commission (CPSC) that could affect companies importing from China passed the Senate on March 6. The Consumer Product Safety Commission Reform Act of 2007 seeks to strengthen product safety by, among other things, requiring mandatory testing for certain products, increasing penalties for safety violations, and boosting CPSC's budget. Introduced by Sen. Mark Pryor (D-AR), the bill passed by a vote of 79-13, despite the Bush administration and...

March 5th, 2008

Though the new PRC Labor Contract Law (LCL) took effect January 1, the law's implementing regulations have yet to be finalized and released, causing significant disruptions for domestic and foreign-invested enterprises (FIEs) seeking to revise labor contracts to ensure full compliance. Several sources suggest the implementing regulations may be discussed at the National People's Congress but are unlikely to be released for public comment or issued in final form during the next few months....

March 5th, 2008

China's Finance ministry recently instituted new procedures that PRC government entities must follow when purchasing imported products, potentially making it more difficult for foreign producers to sell to PRC government entities. The Administrative Regulations on Government Purchase of Imported Products, which was issued on December 27, 2007 and took effect the same day, lay out new procedures for government agencies at various levels to gain approval from their corresponding finance...

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