China scenario's for Google - Kaiser Kuo

Kaiser Kuo by Fantake via Flickr

In his speech at the famous Austin SXSW China's prominent internet watcher Kaiser Kuo closed his keynote with a few scenario's Google has in China. Google threatened to leave China in January after hacker attacks in December, said it would stop censoring its China search engine. But neither has happened, while the tension has gone up. In a summery of ReadWriteWeb:

Kuo said that the Chinese government will wait for Google to make the next move. It realises it has nothing to gain by pushing Google or being openly hostile. The ball is in Google's court and it will probably keep to its word that it will stop censorship in China. It may still shut down operations in China, which in practice means closing google.cn. But this has a lot of problematic scenarios - including the difficulty of having translations done for Google.com and staffing issues of closing down.

The pros of pulling out of China include saving face and appeasing western users. But the cons are significant. They include a backlash from tech-savvy, urban Google users, a setback to scientific research, a global black eye for their image, and ceding the virtual monopoly in search in China to Baidu.

The moderate scenario is that Google.cn is shut down, but continues to work with its mobile partners in China, R&D and sales continue to operate in China, and Google services will be unblocked.

The best case scenario, Kuo believes, would be if Google stopped censoring google.cn - but the service stays online.

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Kaiser Kuo is a speaker at the China Speakers Bureau. When you need him at your conference, do
 get in touch.
Kaiser Kuo also contributed a chapter to our book A Changing China, describing the history of rock music in China from his own perspective.

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Expected: a massive bailout of banks - Victor Shih

Victor Shih by Fantake via Flickr

A massive bailout of China's major banks might be one of the options to let them recoup much of the 2.4 trillion Renminbi (255 billion euro) spend during the recent financial rescue operation, says professor Victor Shih to BusinessWeek today.

“The most likely case is that the Chinese government will engineer a massive financial bailout of the financial sector,” said Shih, a professor who spent months researching borrowing by about 8,000 local government entities.

Chinese officials pledged this week to limit the risks posed by the investment vehicles, which circumvent restrictions on local-government borrowing to channel money into stimulus projects. Yan Qingmin, head of the banking regulator’s Shanghai branch, said March 5 that China plans to nullify guarantees provided by local governments for some loans.

It would not be the first time, China's ministry of finance would jump in to clean up the books of its commercial banks. The five larger banks emerged from the planned economy with many bad loans and a tradition of lending out money without much hope of ever getting it back. That operation has been rather successful, but has suffered a strong setback during the most recent years.
Shih is rather pessimistic when it comes to fast solutions:

He said that if the central government stops lending to the entities now, the cost of a bailout may already be “in the neighborhood” of 3 trillion yuan.

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Victor Shih is a speaker at the China Speakers Bureau. When you need him at your conference, do get in touch.

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China's rich in global top in 15 yrs - Rupert Hoogewerf

by Fantake via Flickr

China's billionaires keep on collecting more wealth and the Hurun founder, Rupert Hoogewerf, the China rich list, expects them to reach the global top in 15 years, when the economy keeps on growing, he tells the People's Daily.
The newspaper focuses on Zong Qinghou, the owner of the wildly successful Wahaha group, China's leading soft drinks producer.

The richest man in China is Zong Qinghou, who runs the multi-billion-dollar soft drink firm Wahaha Group. Zong is ranked 103rd on the list with an estimated wealth of around $7 billion. Not only has he nearly tripled his wealth from $1.9 billion in 2008, he has also improved his standing from 376th earlier. 

Plain-suited Zong, who is also a deputy to the National People's Congress (NPC), told China Daily on the sidelines of the ongoing session that he was not surprised at his ranking considering that his company has been extremely profitable in recent times. 

Rupert Hoogewerf, the British founder of Hurun rich report, said Zong's ranking does not come as a surprise. "Wahaha means 'laughing children' in Chinese and is one of the most valuable brands in the country. The self-made billionaire has always been focused on being the leader in the beverage segment ever since he started his firm in 1987," he said.

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Rupert Hoogewerf is a speaker at the China Speakers Bureau. When you need him at your conference, do get in touch.

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A Chinese patriot, heading for European parliament - Zhang Lijia

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Author Zhang Lijia of the bestseller "Socialism Is Great!": A Worker's Memoir of the New China might be building fame fast outside China, but her interview with the Global Times is a breakthrough. While no political activist, she is also not always toeing the official bureaucracy. But at least in the English-language media, times are slightly changing.

"As you know my view is not always in line with the government, though I regard myself as patriotic," she says, even before the interview.

Despite the odd actions of the powers that be, Zhang is no political activist, and her book is no Cultural Revolution related diatribe like many Chinese authors before. Instead she tells the tale of a young woman growing up and working in the Liming factory in Nanjing, one of China's furnace cities, making intercontinental missiles that could reach America.

Her plans for the future are no less remarkable. As Zhang Lijia holds a British passport, she can enter European politics. In the Global Times:

"I've had a great time in China, It's very vibrant and interesting, and I definitely don't have plans to move. One possibility is that I'd like to try and become a Member of the European Parliament. I just think that it's disgraceful that there are no members that are Chinese, they have them from India and everywhere and China has become too powerful to be ignored. They have to understand how to deal with China.

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Zhang Lijia is a speaker at the China Speakers Bureau. Do you need her at your meeting or conference? Do get in touch.
Zhang Lijia also contributed to our book A Changing China
.

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No Yuan appreciations anytime soon - Shaun Rein

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Wishful thinking has led many analysts to call for an appreciation of China's currency, the Renminbi or Yuan. Shaun Rein goes against that trend and says that an appreciation soon would hurt the recovering export industry too much and might cost up to 5 million jobs, he tells Bloomberg.

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Shaun Rein is a speaker at the China Speakers Bureau. When you need him at your conference, do get in touch.

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Anti-porn "Whack a mole" strategy - Kaiser Kuo

Kaiser Kuo

China's authorities have gone far in an effort to curtain pornography, even by disallowing individuals to register domain names on the internet. It is not a very efficient strategy, says Beijing-based Internet-watcher Kaiser Kuo to China International Business. 

According to Kaiser Kuo, a Beijing-based digital media consultant who works with companies such as Youku.com, "the main difference in this campaign is the fact that they're going after a choke point they haven't targeted in the past – domain registrars." Kuo suggests that regulators are now being more stringent about only allowing business entities to register .cn domain names. 

After a CCTV investigation in December 2009 revealed a wide array of abuse by people registering .cn domain names, China's Internet administrator CNNIC made business licenses obligatory for all applicants trying to register domain names within China's top level domain. ...

As for the effectiveness of these tactics in the face of a seeming endless supply of inappropriate material on the Internet, Kaiser Kuo uses the current analogy: "Anti-pornography campaigns on the Chinese Internet usually tend to have a ‘Whack-a-Mole' quality to them. You whack it down in one place, but somewhere in the dark recesses of the Internet, the mole pops up."

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Kaiser Kuo is a speaker at the China Speakers Bureau. When you need him at your conference, do get in touch.

Challenge: reduce lending, create jobs - Arthur Kroeber

Arthur Kroeber by Fantake via Flickr

China faces this year unprecedented challenges, tells Arthur Kroeber the Wall Street Journal on the day the annual National People Congress (NPC) starts its meeting.

"Last year, Beijing had a simple strategy and a simple message: lend as much money as necessary to keep growth at 8%. This year, the job is trickier: it has to reduce lending, but not so much that growth stalls," said Arthur Kroeber, managing director of research firm Dragonomics in Beijing. "It will be hard to do that without damaging business and consumer confidence."

More in the WSJ.

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Arthur Kroeber is a speaker at the China Speakers Bureau. When you need him at your conference, do let us know. 

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