November 2012-April 2013

Continued tensions between Japan and China over the Daiyou/Senkaku issue have had a steady, negative impact on Japan-China tourism. Tensions began to rise in the autumn of 2012 when the Japanese government bought the Daiyou/Senkaku islands. This heated dispute, widely covered in the media, quickly had a massive, negative effect on tourism. China Daily quotes the Japan National Tourism Organization as posting a whopping 43.6% decline in Chinese tourists visiting Japan in November 2012. China Daily also reports a decline of 31% in Japanese tourist going to China in the same month.

 Although tensions have somewhat cooled of late, the negative effects on the tourism industry on both countries continues to be significant. Data from the Japan Tourism Marketing Co. for April 2013 shows a year-on-year drop of 33% of Chinese visitors to Japan and a year-on-year drop of 25.8% of Japanese visitors to China.

While the numbers are not encouraging to the tourism industry in either country, tourism overall remains robust in both countries. Observers say that the shortfall of Chinese tourists is somewhat offset by the increase in visitors for Taiwan, Thailand and Southeast Asia. As for the Chinese tourism industry, analysts are bullish on the growth of the industry between 2013-2017, particularly in the domestic sector.

Japan Tourism Marketing Co. (Visitor Data April 2013) http://www.tourism.jp/en/statistics/

 

 

A report released this spring by the Paris-based Organisation for Economic Development predicts that China will be the leading world economy by 2016. The report titled OECD Economic Surveys China 2013 is available on the OECD website. In addition to analysis, it also contains policy recommendations including recommendations on Macro-structural policies, financial sector reform, competition and innovation, urbanization, intergovernmental fiscal relations and greening growth.

 The Chinese economy showed a steady double-digit growth to become the world’s second largest economy in 2010.  Growth for the first part of 2013 has been reported at 7.7%. The Chinese economy faces a number of problems including a re-balancing from an economy based on investment and exports to a more consumption-driven one. Other problems citied include property prices, an aging population, social inequality and the environmental costs of growth.

 Many believe that it is a bit premature to dismiss the current world’s number one economy, the United States. Vast stores of shale oil and gas are coming online, and analysts predict that the U.S. will be energy self-sufficient by 2020, and that the U.S. could easily become an energy exporter. This will give the U.S. a definite advantage over economies that will still have to rely on Gulf-region oil supplies in the second decade of this century.

 OECD Economic Surveys China 2013 Overview (PDF)

http://www.oecd.org/eco/surveys/Overview_CHINA.pdf

“Embrace Change, Change is the Best Plan”

   (Alibaba Chairman Ma Yun at Stanford)

 

                     (Photo: China.org.cn)

                         by David Parmer

 Jack Ma the founder and CEO of China’s biggest e-commerce company says he doesn’t understand technology, but he respects those who do. But this is not to say Jack Ma doesn’t get the big picture. In fact he had the big Internet picture in his mind long before a lot of people in China did. In 1999 he founded what is now China’s biggest e-commerce (B to B) company, Alibaba which boasts 79 million members in 240 countries. In 2003 Ma founded Taobao, (C2C) an online Chinese language (now with English pages) website for online shopping similar to eBay and Amazon. Taobao is reported to be the 13^th most popular website in the world.

Forbes magazine estimates Ma’s net worth to be USD$3.4B, and ranks him 395^th in its list of billionaires. Born on September 4, 1964 in Hangzhou, Zheijiang Province, he graduated from Hangzhou Normal University in 1988 with a degree in English, later lecturing in English and International Trade at Hangzhou Dianzi University. In 1995 he founded China Yellow Pages, one of China’s first Internet companies. He followed this up with Alibaba in 1999, and Taobao in 2003.

 In 2009 Jack Ma became a Trustee of the Nature Conservancy’s China program. Besides being involved in several environmental initiatives, Alibaba also bans all product postings on its website related to shark’s fins, ivory, bear bile and products made from endangered animals.

 On May 10, 2013, the tenth anniversary of the founding of Taobao, Jack Ma retired as CEO of Alibaba, stating that he is “too old” to run an Internet company. He is now Chairman of the Alibaba group which is said to be heading for a restructuring of Alibaba, the first and most comprehensive since its founding in 1999. Rumors of an Alibaba IPO by 2015 are also prevalent.

 Jack Ma at Stanford (Chinese w/English subtitles) http://www.youtube.com/watch?v=4QV1xjGfE2M

North Korean leader Kim Jong-un has ordered the North Korean military to keep its combat vessles out of sight. A report on May 27th stated that while reviewing North Korean Naval facilities, Kim spotted several vessles in plain sight. He reportedly stressed that even though it was a drill, North Korea’s enemies were placing the country under increased surveillance.

(Sina English/NHK World)

A report, U.S.-China 2022: US-China Economic Relations in the Next Ten Years, issued on May 21 by the Hong Kong based China-United States Exchange Foundation takes a look at the history of China-U.S. economic relations and prospects for the next 10 years.

The foundation asked academics, business and political leaders from both countries to conduct a study of economic relations past and present. U.S.-China 2022 presents a frank and optimistic appraisal of opportunities and areas of contention in the relationship dating from 1978.The massive report contains a main section and a 19-part second section.

 In the Forward, C.H. Tung, Chairman of the China-United States Exchange Foundation wrote: 

“Indeed over the next 10 years, significant economic opportunities and millions of jobs can be created for the peoples of the two countries if the two countries cooperate together closely.”

U.S.-China 2022 first looks at how the U.S.- China relationship has evolved over the past 35 years and notes how interdependent both economies have become. It then focuses on the future to predict how both economies will develop. Points include:

• China must change its model from export led to internal-demand led and from being the world’s factory to being the world’s market.
• The U.S. must make adjustments to deal with unemployment and address trade deficits. At the same time the U.S. should benefit from its strengths in science technology and innovation, and favorable changes in its energy sourcing as shale oil and gas become readily available.

 The report was issued at an event in New York City at the Asia Society on May 21. Similar events were held on May 22 in Washington D.C., and May 23 in Chicago Illinois. The theme for these events were “US-China Relations in the Next Decade.” Speakers and panelists included Henry Kissinger, C.H. Tung Lawrence Lau, Michael Spence, Wang Chung Zheng and Victor Fung.

 View full report online: http://www.uschina2022.com/

Bloomberg-Businessweek story on launch: http://www.businessweek.com/articles/2013-05-23/the-powerful-people-arguing-for-u-dot-s-dot-china-free-trade