Opening

CIMA opens Shanghai representative office

The Chartered Institute of Management Accountants (CIMA) launched its China representative office in Shanghai in August. CIMA offers an internationally recognized qualification in management accountancy, focusing on accounting in business, in both the private and public sectors. It started working in China two years ago and since then, has been growing steadily with exam centres in Shanghai, Beijing and Guangzhou. Kathy Grimshaw, Director of International Development at CIMA, said "A rapidly growing pool of CIMA professionals here will not only help support China's decision to move towards the adoption of International Accounting Standards and strengthen the corporate governance framework, but will deliver Chartered Management Accountants to contribute to China's business performance and international competitiveness." Founded in 1919, CIMA has over 155,000 members and students in 158 countries.

DaimlerChrysler opens Beijing factory

DaimlerChrysler, the German-US automaker, opened its first factory of Mercedes-Benz and Chrysler sedans in Beijing, as part of its joint venture with Beijing Automotive Industry Holding Co (BAIC). The new facility of BeijingBenz-DaimlerChrysler Automotive Ltd (BBDC) is located in the Beijing Development Area in southeast Beijing. It currently produces Mercedes-Benz E-Class and Mitsubishi Outlander sedans, and will begin producing Chrysler 300C sedans in the near future. "Almost a quarter of a century after DaimlerChrysler co-founded the first international automobile joint venture in China, the opening of BBDC's new manufacturing facility is another milestone in our long tradition in China," said Dr. Dieter Zetsche, Chairman of the Board of Management of DaimlerChrysler AG and Head of the Mercedes Car Group. BBDC has the capacity to build up to 25,000 Mercedes-Benz vehicles and 80,000 Chrysler and MMC vehicles annually, with room to expand. The new facility is part of a US$1.9 billion investment in China. Zetsche said the company plans to expand its financing business and is talking to potential Chinese partners about possibly producing a lower-cost model for the US market.

KPMG opens office in Chengdu

The Swiss-based international financial service company has opened an office in Chengdu, Sichuan province. The office officially opened in September, has employed more than 40 professionals and is looking to welcome more staff from the region. It will offer advisory services including finance, tax, corporate management, international economic advisory and market research. David Ko, Senior Partner for KPMG's Chengdu office said that the economic growth of China's western region, in particular the growth of private enterprises, will help stimulate demand for professional services, including financial advisory and tax advisory services. According to John Harrison, KPMG's chairman for the Chinese mainland and Hong Kong, the Chinese government's western development strategy makes Chengdu an ideal starting point for investing in the western region. KPMG already has nine offices in China and was the first international accounting firm to be granted a joint venture license in 1992.

Launch

Westin Bund Center Shanghai unveils Grand Tower

The Westin Bund Center opened its luxury development, The Grand Tower, on Shanghai's historic waterfront in October. The former residence tower underwent an extensive refurbishment and now offers 269 rooms and suites, including 18 Executive Suites of over 72 square metres, a 250-square metre Emperor Suite and 24-hour personal services such as IPTV and IT Butler. Each room is decorated with modern Chinese paintings and provides user-friendly technology including Wifi and cable internet connection, an MP3-friendly audio-visual system and flat-screen LCD TVs on which guests can order movies and review their bills. The hotel now has 570 rooms in total.

Bayer launches world-scale plant for chlorine recycling

Bayer MaterialScience AG, one of the world's largest polymer manufacturers, announced plans to construct world-scale production plants to manufacture the polyurethane raw materials MDI and TDI at its integrated Shanghai plant. As the world's largest hydrochloric acid recycling plant, the chlorine needed to operate the new facilities is produced on site. Work is currently being carried out on a hydrochloric acid electrolysis facility which is scheduled to be commissioned in 2008 and will have an annual capacity of 215,000 metric tons of chlorine. Bayer mainly produces high-tech polymer materials and develops innovative solutions for products used in the automotive, electronics, construction, sports and leisure industries.

KLM increases flights to Chengdu

KLM will increase the number of flights between Amsterdam and Chengdu from two to three roundtrips a week. The scheduled service was launched on May 28 earlier this year but the growing demand for the route allowed the airline to increase the number of flights which are due to start on December 1. The additional flight, using a Boeing 777, will depart on Fridays from Amsterdam as flight KL 891 and from Chengdu on Saturdays as KL 892. The two existing flights depart from Amsterdam on Tuesdays and Sundays and from Chengdu on Wednesdays and Mondays.

Schenker to offer new logistics powerhouse in China

Schenker said its operations with BAX in China would act as the new logistics powerhouse in China and on the global market, when it attended the September "transport logistic China 2006" trade fair in Shanghai. "With about 3,000 staff and a closely knit network in China, the joint organization of Schenker and BAX in China will offer a wide range of integrated logistics services from a single source, to customers in the country as well as to customers from all over the world", stated Dr. Thomas C. Lieb, member of the Schenker Management Board responsible for global air and sea freight activities. Schenker started its activities in China in 1979 as one of the first foreign freight forwarding companies to be registered in the PRC and now has 1,100 offices worldwide. BAX Global has been established in China since the early 1990s and was one of the first international forwarders to open a representative office in Beijing.

Deal

BASF and SINOPEC agree to expand

BASF and SINOPEC signed an agreement for the planned expansion of their Nanjing joint venture, BASF-YPC Co Ltd. The agreement was signed in Berlin in the presence of German Chancellor Angela Merkel and Chinese Premier Wen Jiabao. The JV plans to expand the capacity of its steam cracker and invest in more downstream plants to further extend synergies at the plant. In July this year, the two companies agreed to invest more than US$500 million in expanding the equal share JV's production facilities. The JV started commercial production in 2005 and uses interconnected plants in order to use products, by-products and energy efficiently to save cost and minimize environmental impact. The 220-hectare site produces 1.7 million metric tons of high-quality chemicals and polymers per year for the growing Chinese market. The site also has a gas-fired power plant and an international port on a tributary of the Yangtze River to ensure optimum energy supply and logistics.

Barco acquires remaining 20 percent of JV

Barco, the Belgium-based imaging technology group, has bought the remaining 20 percent in its Chinese JV, Barco Leyard Electric Technology Co Ltd. The JV was set up in 2003 when Barco acquired the complete full colour LED assets of Beijing Leyard Electronics Technology and since then, has served the outdoor advertising and sports markets. It will take advantage of upcoming events in China, such as the Beijing 2008 Olympics and 2010 Shanghai World Expo, which will both require the visualization products that Barco provides. Barco said the acquisition would not have a material effect on its financial results.

Siemens acquires CNC Water

Siemens has expanded its water treatment business in China with the acquisition of Beijing-based CNC Water Technology by buying a 70 percent stake in its parent company, CNC (HK) Water Technology Ltd. A Siemens spokesman said it has agreed an option to acquire the remaining 30 percent in the next three years. CNC Water Technology has 120 employees and focuses mainly on industrial filtration applications. Roger Radke, head of Water Technologies at Siemens Group Industrial Solutions and Services said the deal will "combine Siemens' water treatment products and systems with CNC's leadership position in large water treatment and seawater desalination projects in China". Since 2002, CNC has conducted some of the largest programmes in china for seawater desalination, industrial wastewater and municipal water treatment.

Haithabu: Renewable Energy Project Partner

In 2005, China passed laws prescribing that within the coming 10-15 years a significant part of the electricity generated in the country should be generated by means of renewable energies. The ambitious goal means that China will potentially grow to be a major market in the world of renewable energy. This means a bonanza for foreign companies, says GM of Haithabu Lorenz Peter Festersen.

Q: What is Haithabu's main business in China?

Haithabu Far East Limited is a Danish-invested company focusing its activities on renewable energy in the Greater China area. From its offices in Hong Kong and Shanghai, Haithabu offers services to regional and overseas companies to enter Chinese markets. Furthermore, Haithabu is marketing globally under its trademark "Sumax" solar products and sourcing components globally.

Q: What is the vision for the company establishment?

The vision behind establishing the company is to support European companies in entering the Chinese market as well as supporting Chinese companies to establish contacts with European renewable energy technology leaders and material suppliers.

Q: What are the major projects you have been working on?

As a direct result of working together with Haithabu, Solar Millennium AG (www.solarmillennium.de) and its engineering arm Flagsol GmbH (www.flagsol.de) signed a strategic cooperation agreement with Hohot-based Inner Mongolia Ruyi Investment Company in May of 2006 to develop solar thermal power plants in China to reach 1GW with a total value of US$2.5 billion by 2020. Furthermore, we work on rural electrification projects in China as well as in developing countries in Southeast Asia and Central America. New projects in the fields of photovoltaic systems and solar energy for district heating are under preparation.

Q: What is Haithabu's niche in the Chinese market?

Being located in China, Haithabu has a good understanding of the needs of the Chinese market in terms of technology and materials. On the other hand, Haithabu has a good overview of technology leaders and material producers globally, which can meet the Chinese needs. This combination puts Haithabu in a good position to assist both suppliers and customers to find suitable solutions for their specific needs.

Q: How do you evaluate the market prospects in the renewable energy sector?

The biggest renewable energy markets are currently Japan, Germany and the USA. However, with the implementation of the renewable energy law, China has the potential to catch up and surpass them within the next 10-15 years. Entering China early will be very important if foreign companies want to participate in this fast growing and exciting market. This is where Haithabu can assist these companies, by conducting market studies, identifying interesting projects and partners for overseas companies interested in entering this market.

Q: What improvements in policies do you wish the Chinese government to make?

The Chinese government made a huge step forward by implementing the renewable energy law early this year. As time progresses, the implementation of this law has to be reviewed on a regular basis to keep them in line with the development of the Chinese energy industry. Making the Chinese renewable energy market more assessable for foreign suppliers and investors will be an important factor in meeting the goals set.

Q: The European Chamber's 2006/2007 Position Paper has just been released. How do you find its usefulness to your business?

Renewable energy is only a small part of the energy sector. However, considering the goal set by the Chinese government to generate 15 percent of all its energy needs through renewable energy, this market will be rapidly growing within the next 10-15 years. This will not only be wind power, but also solar thermal power plants, photovoltaic systems as well as biomass & biofuel. The latter are currently not being addressed in the position paper. I plan to participate in the Energy & Utility Policy Working Group more and more in the New Year so that their concerns are also heard.