Excellent post by Rich Brubaker of the All Roads Lead to China blog on his discussion with Neal Beatty entitled, "Identifying, Measuring, and Taking Action on the Risks of China." It is the kind of post every company doing business in or even with China should read.  

The post sets out an amazingly comprehensive (yet blissfully concise) list of risks businesses face in China:

• Compliance & integrity issues: internal fraud (kickbacks and conflicts of interest are most common)
• Corruption & Graft: recognized by the government in Beijing as a serious issue in China. And now an increasingly serious issue in the US and UK with the growing impact of anti-corruption laws.
• IP issues - counterfeiting, internal theft of critical information, and the protection of your trade secrets are major issues
• Business partners: Who really is your prospective JV partner? How did they accumulate their wealth? Does your partner or key staff have undeclared family or business connections to a competitor or supplier?
• Political and regulatory risks – this is largely more of a strategic, ‘big picture’ issue, but companies who lose touch with the prevailing political pressures affecting their industry can find themselves exposed to problems or shifts that they weren’t expecting.
• Supply Chain risks – lack of transparency and controls along the chain
• Natural Disasters – typhoon, flood, earthquake
• Business disputes – the concept of “illegal detention” by business partners as a means to settle a dispute over payments due; threats by disgruntled former employees.
• Restructuring & labour disputes – closing a factory, or dealing with the disgruntled employee who seeks revenge on a manager
• HR risks – associated with the new HR law and the complexity of hiring & firing staff.

It goes on to note, absolutely correctly, that the extent of each of these risks varies with the companies. I did a post, entitled, "China's Lack Of IP Protection: Overrated. Overrated," and an article in the Conference Board Review, entitled, "In China, Piracy is no Excuse," on how foreign companies are sometimes overly hamstrung by piracy and the lack of IP protection in China.

I particularly like the post's no-nonsense approach to law-skirting:

One of the most serious potential risks to any business in China is the tacit acceptance of the “This is China” approach to business ethics and compliance issues. “We can’t do business without paying the occasional bribe to win contracts” or “it’s OK to allow employees to take a few kickbacks from suppliers – that’s how business is done here”. I’ve heard similar sentiments from managers in China and I worry that they are leaving themselves exposed to more serious issues further down the line. By condoning “low level” corruption within the organization, there is a serious risk of it getting out of control and in the worst case putting the entire operation in jeopardy. A zero tolerance approach is certainly not easy, and requires time, effort and budget, but I would say it is the best way to operate in China, just as in other parts of the world. And it is essential that senior management lay down the law and set out the company culture towards such issues from the very start.

I am often criticized for emphasizing (or over-emphasizing) the risks of not complying with China's laws. Those who criticize me are usually violating one or more laws and their "evidence" is that "so and so has been doing the same thing for five years without any problems." All I know is that in my experience (which consists of having represented and/or spoken with thousands of companies doing business in China), nearly all foreign companies with unresolvable legal problems in China have those problems not because the Chinese government or Chinese laws are "crazy," but because they either ignored or clearly violated Chinese law.

Note how I use the word "clearly." I do so because so many times when foreign companies assert that their problems are due to a lack of clarity in Chinese laws, that simply is not the case. Way more often than not, when foreign companies find themselves on the wrong side of Chinese laws, it is because they either willfully chose to ignore the laws or because they chose to search out an English language explanation (usually not by a lawyer) to justify what they sought to do. For more on this, check out "China's Business Laws. Ignore Them At Your Peril."

The All Roads post nicely notes the role of lawyers in helping to understand and mitigate a company's China risk:

If you are new to China, whether sourcing, selling or manufacturing, the first step needs to be to ask for advice. But who to ask? Lawyers are a necessity, but as I have seen from my own experience, they do not always give you the full picture of the risks your operation may face. So the biggest risk is actually not actively assessing and properly planning for the risks! Many firms still don’t really do this until something goes wrong.

I completely agree. Lawyers cannot give the full picture or the risks your company may face in China because no lawyer can ever know your company as well as you do, no lawyer is ever going to be positioned to see the day to day matters with which your company has to deal, and, most importantly, most of the risks your company is going to face in China are not going to be related to the law.  

So how then can your company operate risk free in China? Well of course it cannot:

I don’t think any company can run “risk free”, no matter what sector or what size of operation. From the largest MNC with multiple manufacturing and distribution facilities around China, to the “one-man-band” sourcing operation, everyone will face risks.

Moreover, you can never reduce risk to zero. No matter how good your risk management program, there will always be someone who does something without considering the possible outcomes and impacts thoroughly, or simply faces a problem that couldn’t be anticipated or couldn’t be prevented. And thus you need to be able to react appropriately and have contingencies in place. But a good awareness of the risks from the very beginning, along with regular (twice a year) reviews of your level of risk exposure, will go a long way to mitigating many of your operational risks.

What are your business risks in China? How do you quantify them? How do you deal with them?

The Dragon Business Network Blog did a post, entitled, "7 Tips for Business Travel to China." Believing both that one was missing and that eight is a lucky number, I added one more.  

Here are the original seven:

1. Bring an unlocked mobile phone
2. Take taxis everywhere
3. Use Mguanxi to get around the city
4. Program 962288 into your phone, in Shanghai
5. Register with Ctrip
6. Know that some hotels cater to the domestic market, not foreigners 
7. Treat yourself to a tailor-made suit

Is Ctrip necessarily better than elong?

For more on the seven, I urge you to read the full post here.  

And now for the eight tip. Enjoy yourself at least a bit. If at all possible, spend a few hours taking in some of the tourist sites.  Walk around the city in which you find yourself. Enjoy the food. Get out of your hotel.

What else?

A project to flush sediment from the Yellow River has been hailed as a technological and environmental triumph. But, writes Meng Si, local communities are at risk.

At four in the morning one day in early July, 31 villagers living on the banks of the Yellow River in Jiaozuo county, central China, woke to find themselves trapped by rapidly rising waters. They made it to safety, but only after a major rescue effort. This was an artificially-created “flood”, designed to clear silt from China’s second longest waterway. And, once again, it drew public attention to Yellow River regulation projects.

Under the Yellow River’s management system, water levels are adjusted at five reservoirs on the river and its tributaries – at Wanjiazhai, Sanmenxia, Xiaolangdi, Guxian and Luhun. When the reservoir gates are opened, the fast-flowing water picks up silt and carries it downstream, clearing the water course and removing sediment from the reservoir.

On the morning of June 19, the Yellow River Flood Prevention Office gave the order to flush silt from the Xiaolangdi reservoir in Xin’an county, Henan province, officially marking the start of the tenth round of silt regulation on the Yellow River. Some 2,500 cubic metres of water a second rushed towards the ocean, carrying with it the silt that had built up on the floor of the reservoir over the previous year.

The Yellow River contains more sediment than any other river in the world. Each year, the river bed increases in height by 10 centimetres as a result of the accumulation of silt. This is the biggest challenge for those trying to manage the flow, and the reason the river so often breaches its banks. The communities next to the Yellow River have, in the 2,000 years for which records exist, seen this happen on average twice every three years.

According to the website of the Yellow River Conservancy Commission (YRCC), the government agency that oversees management of the river basin, careful preparations for the “artificial flood” had been made. There had been three trials and six full-scale operations, during which 380 million tonnes of silt had been moved to the Bohai Sea. 

Efforts to regulate silt in the Yellow River in fact began as early as 1957, at Sanmenxia. An article published on the YRCC’s website in 2007 describes the construction of the water-control hub at the gorge as a monumental effort, made possible only by the heroic spirit of thousands of workers. But as the Soviet experts who designed the dam failed to take into account the amount of silt in the river, in the years following construction, the structure failed to function properly and had a devastating environmental impact.

In the first year of operation alone, the river bed behind the dam rose by 4.5 metres, according to a 2002 report by the Economic Observer. A build up of silt where the Wei River, the Yellow River’s largest tributary, entered the reservoir caused water to back up, threatening Xi’an and the Guanzhong plain. Dykes had to be built along the banks of the Wei, which had never before posed a flood risk. The situation persisted until changes were made to the dam. At the time, the lack of democratic policymaking mechanisms meant that a key opponent of the dam, professor Huang Wanli, a hydraulic engineer at Tsinghua University, was not only unable to influence the process, but was actually persecuted as a rightist.

Almost half a century later, in 2002, the construction of the Xiaolangdi dam and a number of key technological advances allowed the practice of silt regulation to begin, director of the hydroscience and engineering laboratory at Tsinghua University, Wang Guangqian, explained to chinadialogue.

Earlier this year, the South China Morning Post reported that these regulation efforts had raised the quality and quantity of water in the Yellow River, as well as reducing silt. By the end of 2009, it said, the river water was passing more then 70% of potability tests, compared with an 86% failure rate in 2002. Moreover, in eight straight years the river had never run dry, and the continuous flow had helped to improve its ecology. Earlier reports from chinanews.com said that 42 square kilometres of lost wetlands in the Yellow River Delta had been restored, and the bronze gudgeon – a fish not seen since the 1980s – had returned.

These results have not gone unrewarded. In March this year, the YRCC received the Lee Kwan Yew Water Prize at Singapore’s International Water Week, singled out for its use of technological innovation and a sustainable development to achieve success in river management.

Putting together the regulation project reportedly involved cooperation from water authorities in 13 provinces, almost 10 billion yuan (US$1.5 billion) of infrastructure investment and decades of research by numerous academic institutions. And yet these “artificial floods” still carry clear risks. According to the Economic Daily News, the lower reaches of the Yellow River affect the safety and livelihoods of 100 million people, in particular the 1.9 million people who live on its banks. Any errors in controlling the flow could result in a real flood, placing these people and their property in danger.

According to a local media report, the tests for the first silt regulation effort in 2002 resulted in 119 square kilometres of crops being inundated in the county of Puyang, Henan province, alone, affecting more than 125,000 people and causing 165 million yuan worth of damage. According to one Puyang resident, this was the worst flood since 1996, with complete crop failures seen across almost all of the affected land. However, the Commission’s Yellow River Report said that just 33 square kilometres of land – between the river itself and the dykes – had been submerged.

After 2002, the controversy over silt regulation was rarely mentioned in the media. According to Wang Guangqian, “This was because the outcomes were excellent and there was general approval. The project is entirely in accordance with scientific principles.” Unlike the voices that question the wisdom of man-made floods, Wang holds that the practice has lowered the riverbed downstream by more than a metre, doubling flow capacity and greatly reducing flood risk.

But the Jiaozuo incident has revived concerns. This time around, the victims were all local villagers. According to the Oriental Today, the 31 farmers had arrived two days earlier to build a shed and plant crops, and had been sleeping on the ground. While the sudden flooding did not cause any deaths, the loss of crops, seeds and tools still brought heartache. Granted, the villagers were occupying mudflats that were originally part of the Yellow River. But farmers have been making a living in this way – planting crops on the river’s banks – for many years.

Some commentators have raised additional concerns about silt regulation practices. Zhang Ren, a professor at Tsinghua University’s department of hydraulic engineering, told China Newsweek that, given the Yellow River is so short of water, the flooding practice is hugely wasteful. Wang Guangqian refutes this, saying that just a small proportion of the water flow is held back in the reservoirs, where it is stored up to create a flood peak, meaning no water is actually wasted.

Others worry about coping with shifts in flow patterns. Silting varies across different stretches of the Yellow River. On its upper and middle reaches, from the source in the Bayan Har mountains in western China to Hekou in Inner Mongolia and then from Hekou to Taohuayu in Henan province, the river flows through loess plateaus, picking up loose sediment, which gives the water its muddy appearance. That silt is then deposited in the lower reaches, from Taohuayu to the Bohai Sea, causing the river bed – and the dykes – to increase in height. But the situation is changing.

Qin Weizhi, director of Yuangang Agriculture and Forestry Development, a company in Gansu that has long worked on Yellow River siltation, told chinadialogue that there is an urgent need for protection of the wetlands at the Yellow River’s source: “Some 200,000 mu [133 square kilometres] of wetlands are turning to desert every year. There is half as much water as there was five years ago. If this carries on, then sooner or later there are going to be major problems.”

Wang Guangqian maintains that, despite this reduction, silt in the Yellow River has dropped from 800 million tonnes to 600 million tonnes in recent years – due, he says, to soil conservation measures, a reduction in rainfall and the dams built to remove silt. But he also admits that silt regulation suffers from technical limitations and the results of the process are not ideal. The silt deposits in the Xiaolangdi Reservoir are hard to shift and, over the next 20 years, some way of dealing with the accumulated sediment will need to be found. Wang is not worried: “At that point the silt will be higher and therefore easier to move, though control of water flow will be harder.”

Meng Si is managing editor in chinadialogue’s Beijing office. Additional reporting by chinadialogue intern Yang Jie.

Far from the Gulf of Mexico, environmental campaigners are accusing energy companies of destroying land and livelihoods in the search for increasingly scarce resources. Richard Wachman and Jon Stibbs report.

The eyes of the world are on BP after the April disaster that left massive amounts of oil spewing into the Gulf of Mexico. But campaigners accuse Big Oil of an appalling track record elsewhere in the world, saying it leaves a trail of devastation in its wake.

From Nigeria to Kazakhstan in Central Asia, and Colombia and Ecuador in South America, the oil majors stand accused of a blatant disregard for local communities and the environments in which they operate.

With demand for energy expected to surge as industrialisation accelerates in China, India and Brazil, critics say oil companies are taking ever-increasing risks to cash in on yet another bonanza.

Two other factors ensure the dash for oil continues apace. One is growing concern in the developed world that, at some point in the next 30 years, demand could outstrip supply. That means governments are under pressure to make it easier for firms to look for oil in inhospitable areas, whether in deep water off the United States or in the tar sands of Canada.

Secondly, western governments want to reduce their dependence on unstable regimes in the Middle East, which partly explains the recent US move to lift restrictions on drilling in Alaska.

All this could change if the world made a determined attempt to invest more heavily in renewable energy sources, but international initiatives take time. In the interim, the oil majors face a barrage of criticism from environmental and human-rights campaigners in places thousands of kilometres away from BP’s sunken Deepwater Horizon rig.

Nigeria is a case in point. People who live in the Niger Delta have had to withstand huge oil spills for decades. Farmers allege that spills from Shell pipelines have contaminated their land and fishing ponds, and have destroyed their livelihoods. They want Shell to clean up the mess and compensate them for lost earnings. Shell argues that the ruptures to its supply lines are, in the main, the result of sabotage, and that any damages claims should be heard in the Nigerian courts.

The Anglo-Dutch oil giant is by far the biggest oil firm operating in the delta – where, in March 2008, it was estimated that at least 2,000 sites required treatment because of oil pollution. Independent oil and environmental experts estimate that between nine million and 13 million barrels of oil have been spilled in the delta area during the past 50 years – equivalent to an Exxon Valdez disaster every 12 months.

Kate Allen of Amnesty International says: “The result of oil exploration, extraction and spills is that many people in the Niger Delta have to drink, cook with, and wash in polluted water; they have to eat contaminated fish – if they are lucky enough to still be able to find fish – and farm on spoiled land.”

She adds: “After oil spills, the air reeks of pollutants. Many [people] have been driven into poverty, and because they can’t make Shell accountable for its actions, there is enormous distrust between the group and local people.”

A spokesman for Greenpeace says: “Shell operates in 100 countries, but about 40% of spills are in Nigeria, which is quite incredible. There is evidence of sloppy management.” Shell rejects these allegations.

The actions of the Nigerian government are a critical part of this story. Oil is estimated to have earned Nigeria more than US$600 billion since the 1960s, and the oil and gas sector represents about 80% of government revenues; the government’s reluctance to take a hard line with oil companies is not difficult to understand. The most that local people often ever see of the state are armed soldiers visiting the region to protect oil companies’ assets.

A similar story is unravelling in Colombia, where BP has a presence in the Casanare region. Strikers recently blockaded a plant 200 kilometres from the capital, Bogotá, for a fortnight, prompting BP officials to say they felt like hostages. The dispute has been rolling on since February over issues including labour, the environment and human rights. Most of these have now been resolved.

CINEP, a Colombian NGO that investigates oil companies, says the strike was not marked by the extremes seen in previous BP disputes. Its representative Fernando Rodríguez says: “Disputes involving BP are characterised by a heavy hand and shows of government force.”

Rodríguez alleges that in a 1995 dispute with BP contractor Servipetrol, the army shot at the civilian population. He says paramilitaries then persecuted and assassinated community leaders.

BP strongly denies any paramilitary connections. Poly Martinez, a media representative for the company, says: “BP has no relation whatsoever with illegal armed groups, irrespective of their motives or inclinations.” BP did acknowledge it had had to deal with officials in elected positions who had turned out to have paramilitary links.

In Kazakhstan, Friends of the Earth is worried about the environmental, social and health effects caused by the development of the Kashagan oilfield. The consortium behind the project includes companies such as ExxonMobil, Shell and Italy’s ENI. Friends of the Earth said thousands of people already have been relocated in the region because of sulphur emissions and other highly poisonous chemicals such as mercaptans, which are present at high levels in northern Caspian oil. All the companies deny they have behaved irresponsibly.

In Ecuador, the Amazon Defense Coalition asserts that Chevron holds the record for the world's largest oil-related contamination in the populated Amazon rain forest – an even more sensitive ecosystem than the marshes of Louisiana. The allegations are at the root of a class-action lawsuit in Ecuador where the oil giant faces more than US$27 billion in damages for poisoning an area the size of the US state of Rhode Island with 18.5 billion gallons – 70 billion litres -- of toxic “produced water” – water that emerges from drilling activities. That is more than 474 times the amount of contamination estimated to have been spilled in the Gulf of Mexico, according to claims by representatives of the plaintiffs.

A bigger campaign is building behind the involvement of the oil majors in Canada’s tar sands. The sands are naturally occurring mixtures of sand or clay, water and a dense form of petroleum called bitumen. They are found in large quantities in Canada and Venezuela. Making liquid fuels from oil sands requires energy for steam injection and refining. This process generates two to four times the amount of greenhouse gases per barrel of final product as conventional oil.

A spokesman for FairPensions, the shareholder activist group, says: “Every day the extraction process uses enough natural gas to heat 3.2 million Canadian homes for a day. Tar sands are a significant factor in Canada’s failure to meet its Kyoto protocol targets.”

It is also alleged that tar-sands development affects the health and human rights of people over wide areas. According to FairPensions, about 11 million litres of contaminated water leaks into surrounding rivers and groundwater each day, containing arsenic, mercury and various carcinogens that have been linked to elevated rates of cancer in downstream communities.

Investors have raised the issue at Shell and BP shareholder meetings; some shareholders are worried about the long-term profitability of tar sands, pointing to the very high operating costs.

But the oil companies are “as likely to curtail their hunt for new sources of energy as turkeys voting for Christmas”, says Friends of the Earth. The organisation points out that Cairn Energy won clearance in June to drill off Greenland this summer. Greenland is viewed as one of the last great frontier areas in the oil and gas business, and the US Geological Survey estimates that the territory could hold 50 billion barrels of oil and gas. [Cairn recently reported a gas discovery off Greenland’s west coast – “early indications of a working hydrocarbon system” that could lead to a possible oil discovery.]

But campaigners point out that the region is under “constant threat of ice floes”, while in Canada, members of parliament complain that Cairn has had no history of drilling in the Arctic. The company says it has “prepared for every eventuality”.

According to Canadian energy economist Peter Tertzakian: “We are going to the ends of the earth to find the next barrel.” But at what cost? Environmental pressure group Platform says the drive for “frontier oil” comes out of “a political environment whereby concerns over energy security are routinely top of the agenda”. To illustrate its point, Platform points out there has been a quickening in the race for rights to territory in the Arctic, with the Russians symbolically planting a flag under the North Pole during a 2007 submarine expedition.

But the last frontier is perhaps Antarctica. Signatories to the Antarctic Treaty officially refrain from any territorial claims on the continent, but some countries, including Britain, Australia and Russia, have made unofficial claims and produce stamps with maps of Antarctica showing territory purportedly belonging to them.

The worldwide dash for the black stuff underscores Tertzakian’s argument that although we may not soon run out of oil, “new supplies will be increasingly dirty, insecure, expensive and indiscreet”.

http://www.guardian.co.uk/

Copyright Guardian News and Media Limited 2010

Green finance for cleaner energy

The green energy lobby is looking on the recent crisis in the Gulf of Mexico with mixed feelings of sadness and optimism that the spill -- now contained -- could galvanise the push for new sources of power and fresh economic models that reward cleaner energy.

There is more than a hint of “I told you so” from campaigners who have long warned that offshore drilling for oil was potentially disastrous. Energy experts such as Graciela Chichilnisky say the lesson should be to weigh the scale of the risks -- however infrequent disasters may be -- against the rewards.

“Offshore drilling by its own nature involves potentially catastrophic risks, namely small-probability events with enormous consequences. As with nuclear energy, the upside is relatively small,” she says. “The downside, however, is enormous. We are seeing right now what an offshore drilling catastrophe can imply for our nation.”

The Columbia University economics professor is clear, though, that only with financial incentives will investment shift to clean from dirty energy.

“The first principle of creating change is you have to make the change profitable,” she says. “Finance performs a very important role in the world economy and environmentalists usually don’t understand it and they are usually very hostile to finance. But if you are going to have a major transformation, it is not going to happen without finance.”

Green finance could be about to have its day and not just because British prime minister David Cameron has pledged to create a green investment bank. With the political focus on moving away from oil, Chichilnisky and other campaigners are pushing hard for “climate bonds” that would provide financial incentives for the energy industry. “I am totally convinced we have to go solely for the energy industry. They are our enemy so far and I’m convinced that until they become our friends there will be no change in the environmental agenda. Finance can do that,” says the Argentinian-born economist.

Her vision for climate bonds, which she describes as the “carbon market on steroids”, involves investors lending money to power companies from developed nations to go into developing nations and build clean energy plants -- preferably ones that are carbon negative because they capture carbon from the atmosphere for uses such as petrol production.

She is convinced there is demand from investors, developing countries and energy companies, who find it hard to finance projects in such nations in traditional ways. “Here is the pitch: You want to invest in something that leads to more economic growth, more exports for our nation and changes the world economy towards a greener place because it decreases carbon emissions. That’s a good pitch and I want to sell it globally.”

-- By Katie Allen

Copyright Guardian News and Media Limited 2010

Homepage photo by Caroline Bennett/Rainforest Action Network shows crude oil at a toxic pool near Lago Agrio, in Ecuador's Amazon region. The site was abandoned by Texaco in 1990.

I remember China’s olden days, when pizza was served with plastic gloves to prevent the client’s disgust from having to eat the pizza by hand. The Chinese, see, don’t eat with their hands. That was only nine years ago. Last night, I was in Pizza Hut (once again I failed to find a sushi bar

I had a nice meeting with a potential client today. They import products from China into France, for two stable customers. We got to talk about liability insurance.

Wikipedia describes it as “a part of the general insurance system of risk financing to protect the purchaser (the “insured”) from the risks of liabilities imposed by lawsuits and similar claims.”

The manager explained to me that they buy large quantities of very cheap electrical products, such as watches or razors, for about US$1.00 FOB. She has a liability insurance policy covering these goods. It makes sense, since the potential damages are quite high (if some users get harmed by defective products).
She told me it was harder and harder to get this type of policy. Insurance companies are afraid of high claims, so they are not really interested in that type of business.

Just to clarify: this type of insurance policy can protect an importer from getting buried under millions of dollars of claims. But it does not help in any way if the buyer receives junk that cannot be sold at all (in that case the whole order is lost). And it does not help to regain the trust of domestic resellers/retailers.

As usual, I would argue that the most important is to catch issues upstream, at the design stage or at least at the production stage. When the products are on the market, everything is more expensive. See the 1:10:100 rule.

Has anybody got some experience with liability insurance for importers?

In what could be its biggest get yet, China's leading sportswear brand, Li Ning, signed NBA rookie Evan Turner to an endorsement deal Monday. Turner, the 2010 NCAA National Player of the Year, was selected second overall in the draft by the Philadelphia 76ers. Li Ning already has bigger NBA names in Shaquille O'Neal and Baron Davis, but both were signed when they were well past their prime.

USA Diving has also inked a contract with Li Ning, making it the team's official apparel sponsor through 2012. The brand's other non-Chinese national team sponsorships include Spain and Argentina's basketball teams, and USA Table Tennis.

Although these signings and Li Ning's opening of an Oregon concept store and R&D center have all lead to speculation that this could be China's first brand to become an international powerhouse, I've always said that these moves are more about creating an appearance for Chinese customers than about seriously competing with Nike and Adidas globally. Quoted in People's Daily, Ben Cavender of China Market Research Group puts it pretty clearly: ""What they don't admit to and what they are being slightly cagey about is that their strategy is to firm their position in China as a domestic brand. They can appeal to a certain Chinese nationalism by playing on being able to compete head-to-head with the major international brands because they have these big-time athletes."

Related: Can China's hottest sportswear brand go global?

Evan Turner image: Hi.baidu.com

This article also appeared on China Sports Today

Risk.  Everyone in China is exposed to it.  Some recognize it, and act on it, better than others

This was the topic of several conversations between myself and Neal Beatty (Regional Director, Global Client Services for Control Risks).  In some ways it was a followup to the interview I did of Dane Chamorro, his colleague, but this time it was over lunch and encompassed a much larger set of issues…. and given the importance nature of risk, I asked Neal if he would do All Roads readers the favor of answering a few questions about risk in China, if risks here are different than in other regions, and how good firms are at planning for and managing risk.

Below is part 1 of the interview, and with its focus on identifying the risks, and how firms work with “China” risk, there are lessons for everyone.

1. Are the risks of doing business in China any different than say in the US or EU?
Every operating environment has its own risks. What makes overseas operations more complex for multinationals is that many of the operational issues in China (kickbacks, conflict of interest, corruption, etc) are exacerbated by the very fact that they are so far from the comforts of home, and from familiar regulatory and legal environments.

When the company sets up in China, either through acquisition of a local firm, or through establishing a JV or their own facility, the operating environment is often alien. Everyone’s read the books on “doing business in China” and that’s a great start for people new to the country. But that’s just scratching the surface, and often seems to lead managers to over-emphasize or over-simplify a few features of operating environment, so for example you often hear “China is all about “guanxi”; we don’t worry about risk X because our local guys have great connections”. There’s also a tendency even these days to get carried away with the “China is different” concept, and lose sight of commercial and risk-management principles and processes the company applies elsewhere. China is different in many ways and understanding the differences is vital, but that doesn’t mean there’s some mysterious formula here that only a few people understand – like everywhere else, you need a well-informed, comprehensive and rigorously planned out approach to managing risk, not silver bullets. Few companies sit down from the very start, and map out what the risks to the business in China could really be.  They will no doubt have looked into the financial and commercial risks in some detail, but what about the operational or general business risks, not to mention the reputational risks? There is even a potential downside to hiring someone with fantastic local connections to run the business or engage as a joint venture partner, and this needs serious consideration, too.

In China, what you see is not always what you get. This can be especially true of understanding who you’re dealing with in business, whether it’s your key hires, an M&A target, or new partner or supplier. People and entities can have so many hidden interests, connections and potential conflicts that you simply can’t be sure who you’re getting into bed with unless you’ve really done your homework the right way –  specialist due diligence is essential.

2. What are the real risks of doing business in China?  What can business lose if they misjudge their environment?

Some common risk issues include:

• Compliance & integrity issues: internal fraud (kickbacks and conflicts of interest are most common)
• Corruption & Graft: recognized by the government in Beijing as a serious issue in China.  And now an increasingly serious issue in the US and UK with the growing impact of anti-corruption laws.
• IP issues -  counterfeiting, internal theft of critical information, and the protection of your trade secrets are major issues
• Business partners: Who really is your prospective JV partner? How did they accumulate their wealth? Does your partner or key staff have undeclared family or business connections to a competitor or supplier?
• Political and regulatory risks – this is largely more of a strategic, ‘big picture’ issue, but companies who lose touch with the prevailing political pressures affecting their industry can find themselves exposed to problems or shifts that they weren’t expecting.
• Supply Chain risks – lack of transparency and controls along the chain
• Natural Disasters – typhoon, flood, earthquake
• Business disputes – the concept of “illegal detention” by business partners as a means to settle a dispute over payments due; threats by disgruntled former employees.
• Restructuring & labour disputes – closing a factory, or dealing with the disgruntled employee who seeks revenge on a manager
• HR risks – associated with the new HR law and the complexity of hiring & firing staff.

Obviously the extent to which a particular company is exposed to these risks will depend on their specific circumstances, for example the size of the company, the location, the industry and the effectiveness of its own internal risk mitigation controls. But if you show a group of managers the list of risks above, many will admit that they have experienced several of these issues in China.

Most issues will have been dealt with and the business will have survived intact, but once in a while, something happens that has a catastrophic impact on the business, that no-one could have foreseen.

One of the most serious potential risks to any business in China is the tacit acceptance of the “This is China” approach to business ethics and compliance issues. “We can’t do business without paying the occasional bribe to win contracts” or “it’s OK to allow employees to take a few kickbacks from suppliers – that’s how business is done here”. I’ve heard similar sentiments from managers in China and I worry that they are leaving themselves exposed to more serious issues further down the line. By condoning “low level” corruption within the organization, there is a serious risk of it getting out of control and in the worst case putting the entire operation in jeopardy. A zero tolerance approach is certainly not easy, and requires time, effort and budget, but I would say it is the best way to operate in China, just as in other parts of the world. And it is essential that senior management lay down the law and set out the company culture towards such issues from the very start. The Chinese idiom 上梁不正下梁歪 (if the top beam is not straight the whole structure is crooked) is very true.

3. How much of the risk is political vs. cultural vs. commercial?

It is all three. The risks listed above could happen in any country in the world, but what makes China unique is the combination of engrained local business culture and business practices, and very patchy, often lax, legal and regulatory enforcement. This can result in people thinking there are no personal consequences to their actions.

I don’t believe Chinese people are any different in terms of morals or bad behavior than someone from Northern Ireland. But in China, there are cultural norms that sometimes conflict with the corporate expectations. For example, the concept of a conflict of interest is not understood in the same way as in the EU /US. To many Chinese people it seems perfectly reasonable to consider engaging a supplier owned by a family member or old school classmate. After all, I trust these people far more than some random supplier that approaches me at a trade fair. And if laws are unevenly enforced, then employees may never expect that their unethical, and often illegal, behavior might land them in jail.

And a kickback is often seen as nothing more that natural reward for the sales effort, something owed to the salesman, who probably doesn’t make much money anyway: no-one gets hurt, so what is the problem?

Where these three areas (political v cultural v commercial) often overlap is when doing business away from the big Tier One cities. Generally speaking, the influence of local politics on local business is more unrestrained away from the biggest cities. This can pose its own set of unique risks that can only be mitigated by a very thorough due diligence process prior to forming a business relationship in that location.

4. What are the biggest risks that you feel firms overlook when entering China?

I feel the biggest risk is not taking the time to sit back and look really seriously at “what if this doesn’t go according to plan?” or “what if this should happen?” The opportunities in China are huge, as all the business books tell you, but although most people are aware to some degree that there are very considerable risks out there, not so many are keen to think too long about the downside and address that head on when they don’t see any immediate, severe problem.

If you are new to China, whether sourcing, selling or manufacturing, the first step needs to be to ask for advice. But who to ask? Lawyers are a necessity, but as I have seen from my own experience, they do not always give you the full picture of the risks your operation may face.

So the biggest risk is actually not actively assessing and properly planning for the risks! Many firms still don’t really do this until something goes wrong.

5. Are there firms that are in denial on obvious risks?

I would have to say yes.

I once spoke to the head of a multinational R&D facility in Pudong who had first-hand experience of unaccompanied visitors strolling around their facility, with access to any number of laptops left sitting on desks. When asked whether he was concerned about competitors entering the facility to steal trade secrets, the executive replied “but why would anyone want to steal trade secrets from this facility? We have dozens of such facilities in the US, why would they come all the way over here?” The conversation on business risks didn’t go much further.

And then you have an attitude of some foreign managers who, after having worked in China for many years, feel there is no alternative to “low level” kickbacks and bribes. Leaving behind the ethical arguments for a moment, and focusing on the bottom line –it simply is not cheaper in the long run to pay bribes if you had to pay hundreds of millions of dollars in fines in the US and Europe, and you factor in the potential reputational impact.

And then there is the argument ”well, all my Chinese competitors pay bribes to win contracts, so I have to”…

How does the average firm’s risk profile change over the course of its china life?  can a firm run risk free?

I don’t think any company can run “risk free”, no matter what sector or what size of operation. From the largest MNC with multiple manufacturing and distribution facilities around China, to the “one-man-band” sourcing operation, everyone will face risks.

Moreover, you can never reduce risk to zero. No matter how good your risk management program, there will always be someone who does something without considering the possible outcomes and impacts thoroughly, or simply faces a problem that couldn’t be anticipated or couldn’t be prevented. And thus you need to be able to react appropriately and have contingencies in place.  But a good awareness of the risks from the very beginning, along with regular (twice a year) reviews of your level of risk exposure, will go a long way to mitigating many of your operational risks.

Chengdu subway fever is getting more intense! In the latest development, the Chengdu Metro Corporation staged a media event to debut the uniforms that the subway staff will sport come October.

A slide show of all the uniforms is here.

Chengdu subway fever is getting more intense! In the latest development, the Chengdu Metro Corporation staged a media event to debut the uniforms that the subway staff will sport come October.

A slide show of all the uniforms is here.

This week’s revirew of last week’s news follows below: The latest estimate of GDP growth for 2010 comes from the Chinese economist at the World Bank, and suggests 10% – inline with the estimate from Development Research Center of the State Council a couple of weeks ago. Inflation, as then, remains a worry. China’s overseas [...]

This is an advertisement. Candidate should have the editorial, writing and project management skills required to take a piloting role in a new magazine. An interest in family/kids issues (schools, health, and recreation) is essential. The successful candidate will also have the talents and personality suited to team work, rigid schedules, and a varied task load. Dedication, flexibility, and imagination will be highly appreciated. Please send a cover letter, resume and writing samples to hr@urbanatomy.com. A full job description is available upon request. More job ads. Information on how to place a job ad.

Oh My God!!!!!!!!!!!!

Release: 23 November

I am going to SLEEP outside H&M’s biggest flagship store in Shanghai the night before!!! Stand in line while eating my favourite Hof desserts (just nearby).

If you're not quite up for battling traffic on a bicycle, don't have a car, and can't spend half an hour waiting every time you need a taxi, what can you do? The subway doesn't open until next year, so it looks like you'll be getting on the bus.

Buses in Chengdu have traditionally been associated with chaotic crowds of people pushing and shoving to get on, babies relieving themselves on your feet, an engine that's anything but smooth, and smearing your way through a sweaty crowd when you finally get to your stop. With recent fires and collisions, buses' are getting a really bad rap, and so, to improve their public image, the Chengdu Public Transportation Group has been expanding the fleet and upgrading vehicles, stops, and the central dispatch center. With traffic getting ever-worse, it might just be faster to get on the bus than to wait ... and wait ... and wait some more for that taxi.

Map websites edushi and baidu map both offer bus-route search functions for Chengdu (and other Chinese cities). To use them, find the 公交 link and enter the bus line number you want to search or your starting and ending points.

This month, the Chengdu Public Transportation Group launched a new SMS service that allows passengers to check bus route information via text message. While the service is currently available only in Chinese, the menu is relatively simple to navigate.

1. Send the letters "GJ" to 10628106.
2. The system will send you a message. If you would like to pay a monthly unlimited-use fee of RMB1.2, send "GJ" to 1062810628. If you prefer to pay a one-time use fee of 0.3 mao per message, send "GJ" to 1062810629. (The first message is free.)
3. Next, you will receive a message that tells you to reply to it with one of the following:
a. If you want to check all the stops on one line, send "XL" + [the number of the bus line you want to check]
b. If you want to check which lines run between two points, send "ZC" + [the name of the bus stop you're departing from] 到 [the name of the bus stop you're going to], e.g., "ZC天府广场到火车北站"
c. If you want to check locations where you can top up your bus pass, send "CZD"
d. If you want to check the amount left on your bus pass, send "CY"
4. If you do it right, you'll receive a message with the information you requested; if you do it wrong, you'll receive a message describing in greater detail (with examples) of how to format your SMS.

For both the websites and the SMS system, it's best to know the precise names of the stops; the search functions tend to work not very well if you put in just a street name or landmark.

For more information on the Chengdu Public Transportation Group click here

This article was originally published in CHENGDOO citylife Magazine, issue 26 ("How to 3.0"). Photo by Dennis Kruyt.

If you're not quite up for battling traffic on a bicycle, don't have a car, and can't spend half an hour waiting every time you need a taxi, what can you do? The subway doesn't open until next year, so it looks like you'll be getting on the bus.

Buses in Chengdu have traditionally been associated with chaotic crowds of people pushing and shoving to get on, babies relieving themselves on your feet, an engine that's anything but smooth, and smearing your way through a sweaty crowd when you finally get to your stop. With recent fires and collisions, buses' are getting a really bad rap, and so, to improve their public image, the Chengdu Public Transportation Group has been expanding the fleet and upgrading vehicles, stops, and the central dispatch center. With traffic getting ever-worse, it might just be faster to get on the bus than to wait ... and wait ... and wait some more for that taxi.

Map websites edushi and baidu map both offer bus-route search functions for Chengdu (and other Chinese cities). To use them, find the 公交 link and enter the bus line number you want to search or your starting and ending points.

This month, the Chengdu Public Transportation Group launched a new SMS service that allows passengers to check bus route information via text message. While the service is currently available only in Chinese, the menu is relatively simple to navigate.

1. Send the letters "GJ" to 10628106.
2. The system will send you a message. If you would like to pay a monthly unlimited-use fee of RMB1.2, send "GJ" to 1062810628. If you prefer to pay a one-time use fee of 0.3 mao per message, send "GJ" to 1062810629. (The first message is free.)
3. Next, you will receive a message that tells you to reply to it with one of the following:
a. If you want to check all the stops on one line, send "XL" + [the number of the bus line you want to check]
b. If you want to check which lines run between two points, send "ZC" + [the name of the bus stop you're departing from] 到 [the name of the bus stop you're going to], e.g., "ZC天府广场到火车北站"
c. If you want to check locations where you can top up your bus pass, send "CZD"
d. If you want to check the amount left on your bus pass, send "CY"
4. If you do it right, you'll receive a message with the information you requested; if you do it wrong, you'll receive a message describing in greater detail (with examples) of how to format your SMS.

For both the websites and the SMS system, it's best to know the precise names of the stops; the search functions tend to work not very well if you put in just a street name or landmark.

For more information on the Chengdu Public Transportation Group click here

This article was originally published in CHENGDOO citylife Magazine, issue 26 ("How to 3.0"). Photo by Dennis Kruyt.

Shanxi Evening News, September 2, 2010

Yesterday marked the start of the school year. Today, many front pages show students － Shanxi Evening News featured the son of Li Ao (李敖), the Taiwanese political commenter, novelist and essayist, who had enrolled in Peking University.

Li Ao is a political activist who was instrumental in campaigning for the democratization of Taiwan. Now, he criticizes both parties and had many books banned. His program on Phoenix TV, Li Ao Wants to Talk (李敖有话说) is a popular political program.

Li Kan (李戡), his son, made headlines recently for choosing to study at Peking University rather than in Taiwan. Li Kan was born in 1992 and was accepted to both Taiwan National University and PKU, but chose the latter after being disappointed with his home province's education system (detailed in his first book).

Other items on the front page:

• Japan begins to destroy chemical weapons left in China
• An interview with Taiwan pop queen Jolin
• Are many mountain names in Nanjing Shanxi clones?
• Fishing boat sunk by Korean cargo ship. All members missing

Tags: Jolin, Li Ao, Li Kan, PKU, Shanxi Evening News, Taiwan

This article is from Danwei.org

Tang Wei as Tao Yi, the Chairman's first girlfriend

Actress Tang Wei (汤唯), who was blacklisted from appearing in Chinese films or on TV for a time, has been rehabilitated: she is to play Mao Zedong's first love in a new film called The Founding of the Party, a prequel to the state-produced smash hit The Founding of a Republic that was produced in 2009 to celebrate 60 years of the People's Republic of China and Communist Party rule.

Popular husky-voiced actress Zhou Xun who did not appear in The Founding of the Nation will also be in the new film. Liu Ye plays a young Mao Zedong.

From the blog Roast Pork Sliced From A Rusty Cleaver (link below, post includes plenty of photos of cast):

A press conference was held at Beijing Film Studio with many of the cast members in costume but Tang Wei and Zhou Xun were clearly the highlight of the event. Lu Chuan and Sheng Ding will direct parts of the film besides chief director Huang Jianxin. And unlike last time, the cast will not be working for free but receive basic compensation and expenses.

Judging from the photo above, Wa Haha mineral water is the chosen drink of the The Founding of the Party actors.

Tags: film, Mao Zedong, Tang Wei

This article is from Danwei.org

Listen to author Jonathan Chamberlain reading from his memoir Wordjazz for Stevie.

Related posts:

1. Wordjazz for Stevie — “maybe the most moving story you will ever read”

Related posts:

• "Literature and the Cultural Revolution"
• "After Four Decades, Apologies Are Coming Forth"

FRIDAY | SEPTEMBER 3

Local Rock @ Little Bar
With Mosaic,Mr.Turtle & The Trouble. RMB50. Starts at 8 p.m.

1 Year YoMoFo @ Panda Club
Anniversary party with DJs Andy Mac & D.Bassman. House, Breaks & Dubstep. RMB20. Starts at 10 p.m.

Lollipop Party @ Le Café Panam(e)
Electro House with Miss Mixit. No cover. Starts at 10 p.m.

Clinton's Video Music Show @ Shamrock
Don't inhale, get drunk instead. Starts at 10 p.m.

***

SATURDAY | SEPTEMBER 4

Guaili China Tour @ Little Bar
Beijing punk band GuaiLi with debut album Fight of Delusion. Support: Ashtemato. RMB 30. Start at 8 p.m

kit &leigh. @ Machu Picchu
Canadian Folk. RMB20. Starts at 9 p..m.

Reggae Boom Soundz. @ Hemp House
Reggae Boom Soundz. DJ Fifi the Rabbit. RMB15. Starts 10 p.m.

Kräftskiva. @ Kaffe Stugan
Swedish Crayfish Party. RMB 109 (incl. 1 beer or soda, plus all-you-can-drink-Schnapps). RSVP required. 7.30-11 p.m.

Garage Kit.@ Re-C Art Space
Art exhibtion with Yuan Zhenhang, Chuan Hong, Li Jiaxi, Yi Yu, Niu Yuanhao, Wang Peng, Li Ke, Xiao Lei, Zhang Ke. Starts at 11 a.m.

We are together. @Parrot
Charity concert for the victims of the recent floods and mudslides in Sichuan. RMB100. Starts at 8 p.m.

Secondhand Market. @ Machu Picchu. 1-8 p.m.

***

SUNDAY | SEPTEMBER 5
Cao Fang: Farewell, Summer @ Little Bar
Indie Pop Cao Fang.
RMB 120. (RMB 100 for advance booking at Little Bar).

The Red Detachment Of Women.@Sichuan Provincial Gymnasium
Chinese Ballet. RMB80-880. Starts at 8 p.m.

***

ONGOING
1:3 Dong Foto Show @ 7788 Space
40 XPAN cam travel photos. September 3-10.
Lift Your Feet to Wonder @ RedStar35
Illustration exhibition . August 21 to September 5.
Kehua Tiandi: Etchings from the Louvre's Collection @ Sichuan Museum
《刻画天地——法国卢浮宫馆藏铜版画展》 Etchings of a number of renowned pieces from the Louvre, including the Mona Lisa. French-Sino cultural-exchange activities. Through September 5. Click here for more information (Chinese only).
30 Day Zhou Bin Project. @Elephant Bar
Performance art exploring what can and what cannot be pre-arranged. Through September 28.

***

UPCOMING
Miserable Faith @ Little Bar
Beijing Rock. RMB 60. Start at 8 p.m. Saturday, September 11.

5 Years @ Hemp House
Anniversary Party with Mosaic, Mr. Turtle, The Trouble, DJ D.Bassman & Andy Mac. Free entrance. Starts at 10 p.m.

FRIDAY | SEPTEMBER 3

Local Rock @ Little Bar
With Mosaic,Mr.Turtle & The Trouble. RMB50. Starts at 8 p.m.

1 Year YoMoFo @ Panda Club
Anniversary party with DJs Andy Mac & D.Bassman. House, Breaks & Dubstep. RMB20. Starts at 10 p.m.

Lollipop Party @ Le Café Panam(e)
Electro House with Miss Mixit. No cover. Starts at 10 p.m.

Clinton's Video Music Show @ Shamrock
Don't inhale, get drunk instead. Starts at 10 p.m.

***

SATURDAY | SEPTEMBER 4

Guaili China Tour @ Little Bar
Beijing punk band GuaiLi with debut album Fight of Delusion. Support: Ashtemato. RMB 30. Start at 8 p.m

kit &leigh. @ Machu Picchu
Canadian Folk. RMB20. Starts at 9 p..m.

Reggae Boom Soundz. @ Hemp House
Reggae Boom Soundz. DJ Fifi the Rabbit. RMB15. Starts 10 p.m.

Kräftskiva. @ Kaffe Stugan
Swedish Crayfish Party. RMB 109 (incl. 1 beer or soda, plus all-you-can-drink-Schnapps). RSVP required. 7.30-11 p.m.

Garage Kit.@ Re-C Art Space
Art exhibtion with Yuan Zhenhang, Chuan Hong, Li Jiaxi, Yi Yu, Niu Yuanhao, Wang Peng, Li Ke, Xiao Lei, Zhang Ke. Starts at 11 a.m.

We are together. @Parrot
Charity concert for the victims of the recent floods and mudslides in Sichuan. RMB100. Starts at 8 p.m.

Secondhand Market. @ Machu Picchu. 1-8 p.m.

***

SUNDAY | SEPTEMBER 5
Cao Fang: Farewell, Summer @ Little Bar
Indie Pop Cao Fang.
RMB 120. (RMB 100 for advance booking at Little Bar).

The Red Detachment Of Women.@Sichuan Provincial Gymnasium
Chinese Ballet. RMB80-880. Starts at 8 p.m.

***

ONGOING
1:3 Dong Foto Show @ 7788 Space
40 XPAN cam travel photos. September 3-10.
Lift Your Feet to Wonder @ RedStar35
Illustration exhibition . August 21 to September 5.
Kehua Tiandi: Etchings from the Louvre's Collection @ Sichuan Museum
《刻画天地——法国卢浮宫馆藏铜版画展》 Etchings of a number of renowned pieces from the Louvre, including the Mona Lisa. French-Sino cultural-exchange activities. Through September 5. Click here for more information (Chinese only).
30 Day Zhou Bin Project. @Elephant Bar
Performance art exploring what can and what cannot be pre-arranged. Through September 28.

***

UPCOMING
Miserable Faith @ Little Bar
Beijing Rock. RMB 60. Start at 8 p.m. Saturday, September 11.

5 Years @ Hemp House
Anniversary Party with Mosaic, Mr. Turtle, The Trouble, DJ D.Bassman & Andy Mac. Free entrance. Starts at 10 p.m.

VUE bar at Hyatt on The Bund has for many years been without doubt the bar with the best view of Shanghai by night. In my humble opinion, Flair at the Ritz Carlton in Pudong has inherited that title.

Last night I braved wind and rain from typhoon Kompasu and popped in for a few cocktails with 3 lady friends. As with almost EVERY 5 star hotel in Shanghai, the place itself is spectacular while service is still years behind. When I announced to the hostess I needed a table for 4, she just shook her head apologetically and said they were full.

Back in the days when I was still wet behind the ears, I would have turned around and went somewhere else, but 11 years in China has hardened me. I walked straight passed the hostess and found a place by the bar and invited the ladies to sit down. Within minutes, a table for four had left, leaving the table vacant for us and we moved over before proceeding to cocktails.

Why the hostess seemed determined to turn us away I don’t know. Any competent hostess would have offered us a place at the bar and then offered to seat us when a table became available. It seems the default response is always to convince the customer to go away. But anyway, I won’t let that spoil what was otherwise a lovely evening.

During the Expo, lights on the Bund and Pearl Tower go out at 11.30pm, which is already better than the usual time of 10pm, but it was sad to be plunged in to darkness so abruptly, so I’d advise you to go earlier and enjoy the lights with your drinks.

Drinks are standard 5 star hotel prices, so you’re looking at around 100 rmb per drink with service and it’s worth noting they open at 5pm so don’t show up at lunch time hoping to get a daytime view.

58/F, Ritz-Carlton Pudong,
8 Shiji Da Dao,
near Lujiazui Huan Lu
(right across the street from the Shangri-La Hotel)
Tel : 2020 1778

China’s Bureau of Statistics released the latest Purchasing Manufacturers Index (PMI) yesterday. From 51.2 in July, it lifted to 51.7 in August.

Although this news was followed by a similar strengthening of the US PMI, markets seem to have leapt at the news like a pack of seagulls to a potato chip.

At 51.7, the PMI is still in positive territory, but the rebound is hardly a strong one. Some commentators have said that a rebound is a good sign that the Chinese economy will not have a hard landing in the 4th quarter, but I don’t know that anyone thought it would in the first place.

Make no mistake, the Chinese leadership still has the reins held tight on the wild horse that is the economy. Here at AZ China. we believe it will still be another 3 momths or so of tight control before the reins are loosened fully.

Like Google has applications such as Google docs or Google maps, Baidu has one which allows you to download MP3
We are going to explain to you step by step how to get music using Baidu.

First, go to www.baidu.com.

On any given day, Shanghai tea connoisseurs and novices alike can be seen meandering the multi-level complex that is completely devoted to tea at Tianshan Tea City. For true enthusiasts of the drink, this place -- located on Zhongshan Xi Lu near Yuping Lu -- is a promised land. For those wanting to know a little bit more about their leaves, this market houses over 150 stalls sorting, selling, and brewing tea, with vendors ready to tell you all you ever wanted to know about their product. 

Here are our picks of the best stalls to check out. 

read more

Question: will be in shanghai from sept 7, any sales promotion during that time? maybe the summer collection? mainit kasi dito sa Manila, hehehe - AnonymousAnswer: hmmm, the sale for the summer stuff were just over pero check out h&m or c&a, as they usually have sale during the weekend. Right now, they have autumn collection so it is most likely that what they are going to have for sale

The last two weeks in Shanghai have been following a similar pattern. Sunny, warm mornings and rainy, thunder-stormy afternoon/nights. Yesterday a typhoon was said to pass by Shanghai, something that resulted in a lot of schools being closed. The wind, however, proved to be the smallest problem. The rain a bit more so. As you see from the photo and the video (that I took at Hengshan Lu), a lot of Shanghai’s central streets were flooded last night and of course it was impossible to get a cab. I came home soaked and tossed yet another pair of shoes into the pile “ruined by the rain shoes.” Let’s see what today’s gray sky has to offer. According to the weather forecast it’s going to rain for the next 5 days in the city, meanwhile the temperature will still stay above 30… mmmm…. Lovely. Not.

Shanghai was suppose to get a typhoon Wednesday, but apparently it missed the city. I don’t care what the weather reports said, for about an hour there was some insane rain at the Expo. It was raining so hard you couldn’t see out of pavilion windows. The Expo looked like a ghost town, with many visitors waiting out the rain inside pavilions and restaurants. The streets were empty.

Rain might be one the main “themes” of this Expo. There has been way too much of it.

But four months into the Expo and Shanghai receiving a solid helping of rain, the Expo site can get dicey with bad weather. There have been several instances where drains overflow from the amount of rain water. The overhangs of public benches in many areas are actually designed in such a way that when it rains, the water completely soaks the bench. Instead of staying dry under a covered area, the benches become desolate places. No one wants to sit on wet seats.

The biggest problem: puddles. We’re not just talking about a mine field of water accumulation on the ground throughout the Expo. I am talking about puddles that stretch 30 - 40 meters long, cutting off whole areas. Anytime it rains, there are at least a dozen spaces around the Expo where massive ponds form.

I give you the Great American Lake (so named because it forms in Americas Square every time it rains hard):
(Photo: Above, the Great American Lake).

Should one be heading to the Expo any time soon, an umbrella isn’t the only thing one should have with them. You should probably think about strapping on a pair of rain boots too.

Slightly in love!

Shanghai Eye been doing quite a lot of research into social media lately. Its changing, the interweb. Anyhow I was persuaded to join renren.com, profile here.They have some cool stuff, but you need renren beans… to buy upgrades and such. I haven&#...

In honor of summer wrapping up (isn't it Labor Day somewhere over there?), I'm cleaning out the "links that I post someday" pile - some dating as far back as March - ulp. Don't worry, you can still try them. I've tested them all, and none of them contain botulism.

An interview with one of my former teachers, Bill Ayers. You may remember Sarah Palin's caricature of him from the 2008 presidential campaign, but this is a great introduction to a fascinating educator and a warm and concerned human being.

Speaking of education, what if we had educational reform that really worked? Here's one interesting idea. Also, the science of making up stuff, which is a (very very true - I lived it) critique of No Child Left Behind (...shudder...)

A collection a day. Really cool Stuff (as in things. and more things.) And I thought I had too much time on my hands this summer...

The old and the new, together in one photo. Or lots of photos.

Top Secret America. A huge article from the Washington Post about America's intelligence systems that I want to read, haven't gotten around to yet. Or maybe I have. It's Top Secret.

Did you know that the Soviet Union had their own Space Shuttle? Cool (and somewhat sad) pics from the now-mothballed launch site for a machine that never launched.

In praise of doing nothing. Don't know if I got around to posting about the Cult of Busy, but it's worth checking out. Or maybe you should go outside and play frisbee instead...

Revisiting the food pyramid Why do salads at McDonalds cost more than burgers? A clue: we make it that way...

People making bird sounds. Really, they sound like birds. Check it out first, then read the text to see how they did it.

Math is beautiful:

Wow, it feels like I just cleaned out my junk drawer! Thanks everyone, for your indulgence and support...

Sometimes, I reckon Chris and I just have the this freakin' random and AMAZING luck when it comes to hunting down food :P

Because the French village of Sault is so small, we weren't sure if the food there was any good and even if it was, we didn't know which one was the best one. Yes, we don't just go randomly eating at places - we plan it in advance so we know we're going to the yummiest of places. Gotta get biggest bang for our stomach space and all!

We went to a little Tourist Information area and the lady pointed out a little restaurant that was listed as having 2 Michelin stars (!!!) so we immediately decided on that one. Getting there, though, was another matter. It was SO tucked away we were driving down little dirt tracks in the countryside, going "Errrmmm you SURE this is right?" to each other every minute or so. Finally, at the end of the winding, deserted, dirt road.... we saw a big opening and a few low brick buildings up ahead. It was like stepping into a another world.

Le Regain (Route de Saint Trinit, 84390 Sault) is its name and it offers spacious, peaceful, outstanding gastronomy above the Sault highland.

And, oh!, we thought we had walked straight into Heaven.

The restaurant looks like it was created in a home (it probably was), with a large central area and smaller rooms off to the side. The decor is warm and cozy, the service exceedingly polite and impeccable. But it''s the outdoor terrace that took our breath away. Facing Mont Ventoux, the scattered tables were set out for diners to enjoy the colourful sunset and enjoy the balmy mountain breeze. The surroundings are so tranquil, and scented with fresh lavender (from the fields). Looking down, there's lavender and petit épeautre creating a purple and gold patchwork through the valleys. It's breathtaking.

We're amazed to see that during the course of our meal, every table is filled with well-dressed, high-brow diners (we were the only ones casually dressed there), despite the restaurant being in such a remote area. Every diner was French, zero tourists, which convinced us we had stumbled upon a real local gem :)

Interestingly, the menu changes daily, based on chef Yves Gattechaut's creativity and the availability of fresh produce in the region. There is only ONE thing EVERY diner can order - degustation. Well! That certainly made us rather gleeful :P "2 degustations, please!", we said happily.

And so we proceeded to kick back, watch the setting sun on top of a French lavender-scented mountain, and served a stunning degustation meal. It truly felt like I was in a movie. The beauty of the surroundings, the amazing food, the gorgeous restaurant.... it was all quite surreal. We simply couldn't believe our good fortune at having stumbled upon this treasure, and it was THIS meal that was the most memorable meal we had in all of France.

I wish I could've captured the scent, weather, and atmosphere of the place.. it was truly amazing. Kicking myself now for not having at least taken a video! Well, these photos will have to suffice..... :)

If you are in France, and in particular the South of France, you must visit Le Regain. It's the stuff of dreams and so beautiful it'll leave you wanting to go back again. We certainly do!

The hidden Le Regain in the outskirts of the village of Sault in South of France

Looking like a cozy cottage on the inside

Enjoying a quiet dinner overlooking the mountains

A wonderful romantic dinner!

Assorted amuse bouche

Mise en Palais

Oeuf du jour cuit minute a l'infusion de dimant noir
Accompagne de creme d'epeautre escalope de foie gras poele chapeaute de prunes vertes au marc d'elegat

Filet de rouget cuit a l'unilateral pose sur une creme de petit pois au london

Paleron de veau roti au four puis cuit vapeur son jus de cuisson tomate et infusion de tilleul

Emulsion de fromage de chevre a l'huile d'olive vierge de monsieur ravaute

Faisselle aux fruits rouge ou a la farigoul

Douceur du val de sault

The beautiful sunset

Happy belly, happy baby :)

Watching Russia vs. China currently at the FIBA World Basketball championships on CCTV-5. The announcers, as they have all tournament, are in full cheerleading mode. I don't blame them, necessarily, as I want Team China to win as well, but here are some of the things they've said already that would make non-China fans balk:

Russian throws soft pass: "Intercept the ball!"

Commentator 1: "That's a foul.
Commentator 2: "No worries, just stop them (on defense)."

As ball is in air from Russia: "Get the rebound!" The shot goes in.

I've lost count how many times they've said aiya as Russia makes a good play or China misses a shot.

Considering how much China's now falling behind by, the commentating just makes the situation tenser.

On Sunday we had lunch in Azabu-Juban (a subway stop away) at a great vegetarian / vegan cafe called "Eat More Greens". Both the food and the atmosphere (and price) were perfect. Gman had curry and rice and I had taco rice. Both meals came with cold Ceylon tea and an innovative sweet bean dessert - all for less than $10 per person. Not bad for Tokyo.

Oh my. I'm glad I'm no longer eating in China. Tainted milk, fake eggs - I thought I'd seen or heard of everything. But this article tells that it can get worse.

As governor Arnold Schwarzenegger leaves office in November, state residents will be asked to vote on a ballot measure that could kill their landmark climate bill. Jan McGirk reports.

Post Copenhagen, support for carbon trading has been falling globally. Now it appears that even California, famed for its environmental trend-setting, is losing its enthusiasm.  Bucking the trend is China, which reportedly will launch domestic carbon-trading programmes during the next Five-Year Plan period (2011-2015) to meet its carbon-intensity target by 2020.

As governor Arnold Schwarzenegger leaves office in November – having served the maximum term permitted by law -- Californians will be asked to vote on Proposition 23. If approved, this ballot initiative would stall, if not kill, the landmark climate-solutions bill on which the outgoing governor has staked his political reputation as a business-friendly environmentalist.

Two Texas oil companies are behind this latest bid to roll back California’s climate- change legislation until unemployment in the state stabilises at 5.5% -- from its current 12.3% -- for a full fiscal year, even though a bill with similar wording was roundly defeated by state legislators in January. Valero Energy and Tesoro, corporations that both own refineries in California and would benefit from delaying the state’s greenhouse-gas reduction programme, are the initiative’s biggest financial backers. They also are reported to be among the state’s biggest polluters.
 
Their campaign is gathering pace. Advertising spending on both sides of this high-profile issue is predicted to reach US$150 million, which would make it one of the most expensive campaigns in California history. Environmentalists have redubbed Proposition 23 the “Dirty Energy Proposition”, while fossil-fuel lobbyists and Tea Party enthusiasts opposed to government meddling prefer the more anodyne “California Jobs Initiative”.

The initiative has little direct connection to jobs. The target is the Global Warming Solutions Act (Assembly Bill No 32, or AB 32), passed in 2006, which is designed to cap the state’s greenhouse-gas emissions in 2012 and to reduce them to 1990 levels by 2020. Through cap-and-trade requirements on California’s biggest polluters, the law paves the way for investment in clean-energy alternatives throughout the state – yielding $9 billion in new projects so far.

Renewable wind or solar power will provide for at least one third of the state’s energy needs under the current law.  Implementing this California version of the Kyoto Protocol in order to spare future state residents the prospect of living in a post-industrial wasteland is a complex task. Bureaucrats took years of analysis in order to determine current emissions levels and how to monitor the pace of reduction and carbon trading. And just as tougher standards and fines for those who flout them are about to kick in, affected industries are crying foul and objecting to costly new regulations that they fear will drive too many jobs out of state.
 
The benchmark climate law AB 32, which public-opinion surveys indicate is supported by the majority of Californian voters, now is being derided by some conservatives as an exorbitant “energy tax” or a “global-warming tax” in disguise. Because Schwarzenegger, the erstwhile action hero, will no longer be in office to strong-arm its enforcement, environmentalists around the world view this as a hot-button issue. If the initiative passes, pollution controls and clean-fuel standards may lapse and undercut California’s position as a leader in renewable-energy innovation.
 
To pay for implementing its climate law, California must levy extra charges on natural gas utilities, pipeline owners and operators, producers and importers of petrol and diesel fuels, refineries, cement manufacturers, retailers of imported electricity, plus facilities that burn coal. These new fees have raised the temperature of debate.

Opponents of AB 32 contend that more than a million Californian jobs are at risk because state productivity would decline by billions of dollars as soon as greenhouse-gas emissions reductions are enforced. State assemblyman Dan Logue, a first-term legislator, fears that up to $146 billion in new costs could be passed onto California’s consumers.

“I am excited and happy that voters have an opportunity to weigh in on the proposition I wrote,” Logue told chinadialogue. “We can create and bring jobs to California rather than global-warming mitigation. The real issue is that Californians cannot afford to go it alone. AB 32 would have no impact on total global warming … even advisers to Schwarzenegger have admitted that California emits only 1% of the world’s greenhouse gases.”

Tom Tanton, a California energy-technology consultant with links to Big Oil, insisted that “California cannot afford to lead a parade right now with nobody following”.  And the inability of the US Senate to pass a similar climate-change bill for the nation does not bode well for the political will to legislate for cleaner industry inside California.

Leading businessmen are confident that the California climate law will nurture a burgeoning clean-tech industry and will create at least half a million new jobs. “AB 32 is an incubator of innovation,” Eric Schmidt, the head of Google, told the Los Angeles Times earlier this summer. Schmidt predicts that employment will rebound as “business responds to the need for energy-efficient buildings, transportation and a growing portfolio of renewable energy resources.” Power from offshore wind, rooftop solar and waste biofuels will prove cheaper in the long run than conventional energy derived from fossil fuel or nuclear plants.
 
Utilities companies have spent the past four years preparing to comply with new standards and they oppose Proposition 23. The chairman of Pacific Gas and Electric Corporation (PG&E), Peter Darbee, pledged the company’s commitment “to helping California make progress, moving us toward a low-carbon economy while minimising the impact on customers as we make this necessary transition”.  He notes that “unchecked climate change could cost California's economy tens of billions of dollars a year in losses to agriculture, tourism and other sectors,” adding: “Thoughtful and balanced implementation of AB 32 is one of the most important opportunities we have to avoid this costly outcome while spurring new clean-tech investment, innovation and job creation in California.”

Anita Mangels, spokeswoman for the California Jobs Initiative committee, is dubious about his motives. “Defeating our initiative would allow PG&E to increase its rates and its profits at the expense of California’s already struggling families and businesses,” she said, adding that passing Proposition 23 “will not weaken, repeal or roll back California’s global-warming law in any way. It will simply temporarily adjust the timetable.”

Unsurprisingly, Schwarzenegger wants to combat Proposition 23.  Recently the Republican governor was touted as America’s next green hero, a celebrity who could help put some muscle behind US environmental policies and reach out to partners overseas for a global solution to climate change.

“This initiative sponsored by greedy Texas oil companies would cripple California's fastest-growing economic sector, reverse our renewable energy policy and decimate our environmental progress for the benefit of these oil companies' profit margins,” he wrote on his official website. "I will not allow this to happen on my watch."
 
Schwarzenegger’s trade overtures to China’s Jiangsu province, as well as to other foreign countries and provinces, have already yielded international collaboration in green technology for energy efficiency, but uncertainty over California’s future energy policies is likely to hinder planning for new projects -- at least for a few months. Promoting regional green economies and nudging national governments towards the same goal is a priority.

“Our mission is to address climate change while enhancing trade, and to share best practices with Jiangsu province,” said Elizabeth Turner Fox, director of US programmes for the US-Jiangsu Green Partnership. “New technology will be developed if there is research and development partnership. The faster climate change is addressed, the better news for the planet.”
 
Whoever wins the race for governor in November will set the tone for California’s next decade or so. The frugal and eco-friendly Democratic Party candidate (and former governor) Jerry Brown openly supports the cap-and-trade measures of AB 32 and is against the proposal to roll it back. He has his own nuanced green agenda, too:
 
“You'll see a great plan for new energy jobs, about 500,000 from investing in 20,000 megawatts of renewable energy and efficiency retrofits,” he told the CNBC business news channel earlier this summer. “This is a very powerful proposal. I know what I'm talking about.”
 
The Republican Party challenger, Meg Whitman, is less forthcoming. She urges a one-year moratorium on AB 23, ostensibly to enable Californians to ride out their current unemployment crisis and to coordinate the state emissions standards with any federal climate legislation that might be passed in the interim. The wealthy former eBay chief executive has not explicitly supported Proposition 23. Recently she toned down the rhetoric on her glossy campaign pamphlets to be less strident on this topic, which does not resonate with her Silicon Valley colleagues, nor with the independent suburbanites who her political advisers pinpoint as the swing voters who could win her the governorship.
 
“California has a choice,” Whitman said on a recent television broadcast. “We can put our head in the sand and continue to lose jobs overseas and to other states, or we can say, `You know what? We are not going to lose another job from California, and we're going to be the very best place to start and grow a business.' So I'll be the chief sales officer for California businesses.”

Californians still view themselves as global trend-setters, and even though the bankrupt state is $20 billion in the red and its economy has dropped from ranking as the world’s eighth largest down to 12th place, its blue-sky thinkers hanker for renewable energy and a boost in the green-job sector.
 
Most of California’s consumer-protection measures, such as a cigarette-smoking ban in public places or mandatory smog regulators on cars, eventually became mainstream and have been adopted in much of the United States. Whether this can happen with climate legislation, despite the economic downturn, remains to be seen.

Jan McGirk is a former correspondent for The Independent (London) who has reported on environmental issues and disasters in Asia, Latin America and the Middle East.

Homepage image from California's Office of the Governor shows Arnold Schwarzenegger speaking in a panel discussion at the 2009 Copenhagen climate conference.

More bad news for clubbers, as Lantern will close its doors following a farewell party this Saturday night (September 4). Karaoke chain Kuzi is taking over a sizeable chunk of 3.3 Shopping Mall’s basement, spelling the end for Lantern, the arcade beside it and other businesses.

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Don't make it a struggle to read your slides

Renovations finished at Fubar last night and just in time since this Workers Stadium joint will mark its sixth one-kuai drinks special tonight. Held the first day of each month, the special runs from 6 PM to 8 PM and this month will feature pints of Tasmanian Devil Margaritas for RMB1. And because people always [...]

A couple of weeks back I sat down with a fine young man from the Global Times to discuss one of my favorite topics: Bikes in China. The article is entitled Wings on Wheels. I thought this would be rather...

As you may or may not know, there are typhoons coming up the coast, and they have been threatening the Tantoushan trip. We have been monitoring many weather reports on many different websites and stations, and we have been trying to wait till the last minute to make and changes due to the weather.

Here is an example of one of the reports:

We have decided that it is just too unsafe to continue with a trip to Tantoushan at this time. We have decided to move the Tantoushan trip to next weekend (10^th,11^th,12^th) instead. We realize that this will create some problems for some of you, and we apologize for that. I hope all of you can still go, but if you cannot, please let me know! Of course, any deposits made will be returned if you cannot make the new date.

On the other hand, if some of you could not make it on this weekend buy can make it on the next weekend, please let me know, and I will try to accommodate you.

We still have great activities, and great prizes for them, so please let’s make next weekend a great trip. I have checked the weather, and it will still be a warm weekend.

I will keep you all updated for the next weekend.

I’m sorry for this inconvenience.

可能大家有所不知，这几天有台风，威胁到了这次檀头山露营。我们在很多不同的网站上和气象台查看了天气预报，我们也是等到最后然后根据天气做最后的决定与变动。

这是其中一个天气预报：http://weather.weatherbug.co.uk/China/Shipu-weather/local-forecast/weekend-forecast.html?zcode=z6286（这个天气预报是最坏的预测，但是每个天气预报上都有雨和雷阵雨，同时还有大风）

我们认为这个时候去檀头山露营会有点不安全，所以我们决定将此次活动推迟到下个周末（10,11,12号）我们也意识到这样可能会给你们其中一部分人造成困扰，在这里先向你们道歉。我希望大家都能继续参加我们的露营，但是如果你有什么不便，请提前通知我。当然，如果你打算不去的话，我们会将押金退还给你的。

另一方面，如果其他人这周不方便但是下周末有时间参加活动的话，请与我们联系，我们会尽力你满足你的需求。

我们仍旧有精彩的活动和精美的礼品。所以，让我们期待下周末的精彩之旅。我已经查看了天气，下周末天气还是会比较温暖。

下周我会继续为你们更新信息。

再次为我们造成的不便表示歉意。

Best Regards,

Matthew Galat (马特)

The Chinese government offers scholarships for courses and seminars to Uruguayan citizens in the public sector. The scholarships include international travel, lodging, meals, local transportation, and pocket money. The Uruguayan government, through its Office of Planning and Budgeting (OPP), is receiving applications through its page http://www.opp.gub.uy/becas_cursos.php with different application deadlines. Please refer to OPP’s website

Date: Sep 1st 2010 2:12p.m.
Contributed by: stonebanks

Since its launch just nine months back, Acupuncture Records' club, Lantern, has become a Beijing institution, the beating heart of underground electronic music in China's capital. So, we were near devastated when we first heard that Lantern might be closing its doors in September.

As of today, it's official: this is the last weekend for Lantern in its current space. So, make this one count.

The powers that be will soon be gutting the basement of 3.3 to make room for an upscale KTV chain.

In the meantime, Acupuncture events scheduled for this month will be moving to LAN Club and House. Stay tuned for more details.

This weekend, however, sees two major final parties at Lantern:
• The legendary Robert Hood on Friday (free before midnight!)

and

• The Transit Farewell Bash on Saturday

After a slow couple of weeks as the local cinema scene recovered from Aftershock, things are picking up with the arrival of Hollywood’s latest hit Inception. Unlike most of what comes out of the Californian Hills, this looks like a movie that might tickle your brain as well as your senses. 798’s UCCA also has a couple of great screenings coming up of new, rarely seen Chinese features.

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Beijing Times, September 1, 2010

The eye-catching front-page photo on today's Beijing Times comes from the scene of a massive accident on Beijing's north Fifth Ring Road. Early yesterday morning, an overturned truck spilled its cargo across all eastbound lanes near Guangze Bridge, blocking traffic and leading to two five-car pile-ups. There were no deaths, and the roadway was cleared by 5 am.

The Beijing News also featured the accident on its front page, but the story was oddly nowhere to be found on the cover of the Beijing Youth Daily.

Although the Beijing Times does cover today's big news stories — mobile phone service now requires an ID, a China Express airplane that scraped a wingtip on the ground while landing at Beijing Airport — the paper's top story is a local follow-up report about Premier Wen Jiabao and a geography textbook.

In 2009, at the beginning of the fall term, the premier paid a visit to a Beijing middle school where he studied math, literature, geography, research methods, and music with local students. During the geography lesson, Wen pointed out that the school's textbooks included Shaanxi and Gansu as part of Northern China (华北), when they clearly belonged to Western China (华西).

The textbook in question has been revised, and students this term will learn that Shaanxi and Gansu now belong to "The North" (北方), which unifies Northern China and Northeastern China into a single geographic unit.

"Northern China" (dotted) vs. "The North" (image from Beijing Times)

This edition also eliminates standalone chapters for Taiwan Province and Hong Kong & Macau, which are now treated as part of "The South."

Tags: accidents, Beijing Times, education

This article is from Danwei.org

Although a woman's purse is usually a very private place, finding out what’s inside gives us the inside scoop on daily life in Shanghai from highs (a day at the pool) to buys (hats off to the Nokia E71 marketing team, it seems Shanghai has gotten your message).

We stopped five women on the street in Shanghai and asked, "What’s in your purse?"

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Moluccan folk fused with modern jazz? If you’re not quite sure what that would sound like, head over to Star Live on Friday, September 10 to find out. Boi Akih, comprising life partners Monica Akihary and Niels Brouwer, plus table player Sandip Bhattacharya, will be taking the stage there in the group’s Beijing debut.

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