Author Archives: SBX

First of #ThirtySixStratagems: 瞒天过海 (瞞天過海) – Mántiānguòhǎi; #English: Sneak across the ocean in broad daylight

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Mini strategy series @soerenbax: The Thirty-Six Stratagems, a collection of ancient Chinese military thought and experience.

Characters of the first of Thirty-Six Stratagems: 瞒天过海 (瞞天過海) – Mántiānguòhǎi. 瞒, mán: conceal. 天, tiān: sky. 过, guò: to cross. 海, hǎi: sea, ocean.

Meaning: To hide action within a unsuspicious, everyday action. To pretend everyting is just business as usual, but actually striking at the opponent.

Business example: When preparing a hostile take over of a stock listed company, it may be wise to hide the true intention, because of possible counter measures. At least at first and until enough shares are already collected. This maybe done through intermediate banks and traders and in small steps. The purchase will look like everyday trade and won’t attract too much attention. When enough shares are collected, then the takeover can be announced. Sneak across the ocean in broad daylight.

Times of change for China

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Thousands of party members were accused of corruption in 2013. President Xijinping is taking the fight against corruption seriously. The sheer volume of cases is impressive. This fight against corruption is not a very new development, but new is the fact that even the highest party functionaries are not safe anymore.

It remains unclear if Xijinping is using this fight also for his own agenda, to get rid of his political adversaries. The following years will show if Xi can be remembered for cleaning up and improving the economic environment.

Overall China is currently in a period of transition. The fight against corruption is causing a lot of commotion and wide spread reforms are being enacted. These reforms will take time, but a transition of the Chinese economy will happen.

A shift to a more consumption driven growth will be necessary. But also the environmental living conditions and the rule of law have to be improved if China hopes to attract global firms and foreign direct investments.

The basic conditions and potential for economic growth remain intact. Export driven growth currently remains sluggish. Also China remains rather insular and fails to integrate regionally and globally. Territorial disputes with most of its neighbours upset regional governments and hurt international trade. Japan is outpacing China in Asia with outbound investments, while China is busy with internal reforms, internal unrest and border disputes.

Cost are rising fast in China, labor disputes and questionable decisions of local labor authorities increase the overall cost of manufacturing. Times are tough, prices and factor cost are rising. It remains important to find new sources of income and watch the details even more. Keep an eye out for trouble spots and insist on due diligence in your China operations.

Chinese public holidays in 2014

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Dates of Chinese holidays in 2014 according to state council publication:

1. Unified schedule for public holidays and festivals, 2014, year of the horse

2. Public holidays and festivals for all people

New Year, one day holiday (January 1);

First Day of the year of the horse is January 31st, 2014;

Spring Festival Holiday, Chinese New Year, three days holiday (First three days according to the lunar calendar); (Jan 31 to FEB 2);

Ching Ming Festival, one day holiday (Lunar Qingming day); (Apr 5);

Labor Day, one day holiday; (May 1);

Dragon Boat Festival, one day holiday (Lunar Dragon Boat Festival day); (Mai 31);

Mid-Autumn Festival, one day holiday (Lunar Mid-day); (SEP 8);

National Day, three day holiday (October 1, 2, 3);

3. Special public holidays and festivals for specific groups of the population

Women’s Day, half-day holiday for women; (March 8);

Youth Day, half-day holiday for the youth over 14 years of age; (May 4);

Children’s Day, one-day holiday for children under 14 years of age; (June 1);

People’s Liberation Army Day, half-day holiday for soldier in active duty; (August 1);

4. Minority festivals or holidays will be fixed according to local customs;

5. All other holidays or festivals are not public holiday in 2014

6. If a public holiday (section 2) falls on a Sunday or Saturday, it should be compensated by a day-off on a normal work day. This rule does not apply for special public holiday (section 3)

7. These rule come into affect on the day of publication

Original publication by the State Council:
http://www.gov.cn/zwgk/2013-12/11/content_2546227.htm

Annual Central Economic Work Conference (CEWC)

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The CEWC is part of the annual policy cycle, following on the Politburo meeting earlier this month.

 

The CEWC issued a statement emphasizing the need for stability, stability of economic reform and macroeconomic policy.

 

The statement mentions several areas of reform, but does not give much detail. However the need to resolve the overcapacity problem gets more attention than before.

 

6 key tasks a mentioned for 2014:

 

Food security; industrial structure (including overcapacity problem); dept risk prevention; coordinated regional development; to protect and improve the people’s livelihood; continuously improve the openness of economy.

 

An emphasis on stability[1]|chinadaily.com.cn.