China
A Notable No-Show at Communist Party’s 90th Birthday
China’s Communist Party does not generally like surprises – especially not during minutely choreographed ceremonies like the one held Friday to celebrate the 90th anniversary of its founding. So tongues quickly began wagging when Jiang Zemin, the 84-year-old former Party chief and President, failed to appear alongside other retired leaders at the anniversary celebrations, screened live on state television. Most of the other big guns were there, including 82-year-old former Premier Zhu Rongji, now sporting a mop of grey hair instead of the standard dye-induced black favored by incumbent leaders. Li Peng, another ex-Premier, was also there, although he appears to be still using the dye, boasting a full head of glossy black hair despite being just a few weeks younger than Mr. Zhu. But as the China Central Television camera lingered on each of the elders, there was no sign of Mr. Jiang, who was succeeded as Party chief by Hu Jintao in 2002 and stood alongside him at a ceremony to mark the 60th anniversary of the People’s Republic in 2009. Mr. Jiang’s surprising, and very obvious, absence is now certain to fuel rumors circulating in Beijing in recent months that he may be severely unwell, and therefore losing his ability to influence key Party decisions – including a once-a-decade leadership change next year. The official People’s Daily reported in May that Mr. Jiang was among current and former leaders who sent condolences on the death of former Vice Premier Chen Muhua, but his name was not listed among those who actually attended the cremation. His no-show at the 90th anniversary ceremony is much more significant, however, especially given the presence of retired leaders who were junior to him in ranking. Whatever the actual reason, his absence creates the perception within the Party that whatever influence he wields behind the scenes is diminishing relative to other current and retired leaders, each of whom represents their own interest group. Mr. Jiang does not have any formal power, but is consulted on major Party decisions, copied in on many important internal Party documents, and permitted to write notes alongside them, according to Chinese and Western political analysts. Retired leaders are also thought to have a say in the selection of the next Politburo Standing Committee – the top decision-making body – which is due to see seven of its nine members retire next year. Vice President Xi Jinping, 58, has already been anointed as the next Party chief and president through his promotion to a key military post last year, but other seats on the Standing Committee are up for grabs. The final lineup will not be known until the 18th Communist Party Congress in autumn next year, but the Party’s Organization department is expected to circulate a list of a dozen or so potential candidates amongst the Party elite some time this year. So the maneuvering has begun as current leaders try to promote proteges to secure their legacies, vested interests and continued influence, while candidates for promotion seek to burnish their credentials and out-flank potential rivals. Bo Xilai, the 61-year-old Party chief of Chongqing, has been the most brazen in his power play, overseeing a high-profile campaign to revive the spirit of Chairman Mao Zedong, mainly through revolutionary singing pageants . He even roped in Henry Kissinger , the former U.S. Secretary of State who negotiated the re-opening of diplomatic ties with China, to attend a red singing contest in Chongqing this week. Wang Yang, the 56-year-old Party chief of the southern province of Guangdong, has had a tougher time of late with a series of incidents of labor unrest on his patch, but he appeared to hit back this week with what some analysts say was an oblique attack on Mr. Bo’s “red” campaign. “For a mature ruling political party, it’s more important to study and review its history and strengthen a sense of anxiety than to just sing the praises of its brilliance,” he was quoted as saying by the People’s Daily web site. There has also been fresh talk this week that Li Keqiang, who is 56 and currently a vice premier, might not be the clear frontrunner for the premiership. Mr. Li – who studied law — was once considered Mr. Hu’s preferred successor, and was thereafter tipped to take over as premier, overseeing the entire Chinese economy. But Wang Qishan, another vice premier responsible for the financial system, has been persistently discussed in business circles as a stronger candidate to guide the world’s second largest economy — even though, at age 63, he would only be allowed to serve one five-year term. “A powerful personality, Wang has the potential to press for more decisive reforms, albeit within the considerable constraints of China’s collective leadership,” wrote the Eurasia Group in a research note Thursday. – Jeremy Page
China’s Communist Party does not generally like surprises – especially not during minutely choreographed ceremonies like the one held Friday to celebrate the 90th anniversary of its founding. So tongues quickly began wagging when Jiang Zemin, the 84-year-old former Party chief and President, failed to appear alongside other retired leaders at the anniversary celebrations, screened live on state television. Most of the other big guns were there, including 82-year-old former Premier Zhu Rongji, now sporting a mop of grey hair instead of the standard dye-induced black favored by incumbent leaders. Li Peng, another ex-Premier, was also there, although he appears to be still using the dye, boasting a full head of glossy black hair despite being just a few weeks younger than Mr. Zhu. But as the China Central Television camera lingered on each of the elders, there was no sign of Mr. Jiang, who was succeeded as Party chief by Hu Jintao in 2002 and stood alongside him at a ceremony to mark the 60th anniversary of the People’s Republic in 2009. Mr. Jiang’s surprising, and very obvious, absence is now certain to fuel rumors circulating in Beijing in recent months that he may be severely unwell, and therefore losing his ability to influence key Party decisions – including a once-a-decade leadership change next year. The official People’s Daily reported in May that Mr. Jiang was among current and former leaders who sent condolences on the death of former Vice Premier Chen Muhua, but his name was not listed among those who actually attended the cremation. His no-show at the 90th anniversary ceremony is much more significant, however, especially given the presence of retired leaders who were junior to him in ranking. Whatever the actual reason, his absence creates the perception within the Party that whatever influence he wields behind the scenes is diminishing relative to other current and retired leaders, each of whom represents their own interest group. Mr. Jiang does not have any formal power, but is consulted on major Party decisions, copied in on many important internal Party documents, and permitted to write notes alongside them, according to Chinese and Western political analysts. Retired leaders are also thought to have a say in the selection of the next Politburo Standing Committee – the top decision-making body – which is due to see seven of its nine members retire next year. Vice President Xi Jinping, 58, has already been anointed as the next Party chief and president through his promotion to a key military post last year, but other seats on the Standing Committee are up for grabs. The final lineup will not be known until the 18th Communist Party Congress in autumn next year, but the Party’s Organization department is expected to circulate a list of a dozen or so potential candidates amongst the Party elite some time this year. So the maneuvering has begun as current leaders try to promote proteges to secure their legacies, vested interests and continued influence, while candidates for promotion seek to burnish their credentials and out-flank potential rivals. Bo Xilai, the 61-year-old Party chief of Chongqing, has been the most brazen in his power play, overseeing a high-profile campaign to revive the spirit of Chairman Mao Zedong, mainly through revolutionary singing pageants . He even roped in Henry Kissinger , the former U.S. Secretary of State who negotiated the re-opening of diplomatic ties with China, to attend a red singing contest in Chongqing this week. Wang Yang, the 56-year-old Party chief of the southern province of Guangdong, has had a tougher time of late with a series of incidents of labor unrest on his patch, but he appeared to hit back this week with what some analysts say was an oblique attack on Mr. Bo’s “red” campaign. “For a mature ruling political party, it’s more important to study and review its history and strengthen a sense of anxiety than to just sing the praises of its brilliance,” he was quoted as saying by the People’s Daily web site. There has also been fresh talk this week that Li Keqiang, who is 56 and currently a vice premier, might not be the clear frontrunner for the premiership. Mr. Li – who studied law — was once considered Mr. Hu’s preferred successor, and was thereafter tipped to take over as premier, overseeing the entire Chinese economy. But Wang Qishan, another vice premier responsible for the financial system, has been persistently discussed in business circles as a stronger candidate to guide the world’s second largest economy — even though, at age 63, he would only be allowed to serve one five-year term. “A powerful personality, Wang has the potential to press for more decisive reforms, albeit within the considerable constraints of China’s collective leadership,” wrote the Eurasia Group in a research note Thursday. – Jeremy Page
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A Notable No-Show at Communist Party’s 90th Birthday
China
China Implements New Policies to Boost Foreign Investment in Science and Technology Companies
China’s Ministry of Commerce announced new policy measures on April 19, 2023, to encourage foreign investment in the technology sector. The measures include facilitating bond issuance, improving the investment environment, and simplifying procedures for foreign institutions to access the Chinese market.
On April 19, 2023, China’s Ministry of Commerce (MOFCOM) along with nine other departments announced a new set of policy measures (hereinafter, “new measures”) aimed at encouraging foreign investment in its technology sector.
Among the new measures, China intends to facilitate the issuance of RMB bonds by eligible overseas institutions and encourage both domestic and foreign-invested tech companies to raise funds through bond issuance.
In this article, we offer an overview of the new measures and their broader significance in fostering international investment and driving innovation-driven growth, underscoring China’s efforts to instill confidence among foreign investors.
The new measures contain a total of sixteen points aimed at facilitating foreign investment in China’s technology sector and improving the overall investment environment.
Divided into four main chapters, the new measures address key aspects including:
Firstly, China aims to expedite the approval process for QFII and RQFII, ensuring efficient access to the Chinese market. Moreover, the government promises to simplify procedures, facilitating operational activities and fund management for foreign institutions.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
Q1 2024 Brief on Transfer Pricing in Asia
Indonesia’s Ministry of Finance released Regulation No. 172 of 2023 on transfer pricing, consolidating various guidelines. The Directorate General of Taxes focuses on compliance, expanded arm’s length principle, and substance checks. Singapore’s Budget 2024 addresses economic challenges, operational costs, and sustainability, implementing global tax reforms like the Income Inclusion Rule and Domestic Top-up Tax.
Indonesia’s Ministry of Finance (MoF) has released Regulation No. 172 of 2023 (“PMK-172”), which prevails as a unified transfer pricing guideline. PMK-172 consolidates various transfer pricing matters that were previously covered under separate regulations, including the application of the arm’s length principle, transfer pricing documentation requirements, transfer pricing adjustments, Mutual Agreement Procedure (“MAP”), and Advance Pricing Agreements (“APA”).
The Indonesian Directorate General of Taxes (DGT) has continued to focus on compliance with the ex-ante principle, the expanded scope of transactions subject to the arm’s length principle, and the reinforcement of substance checks as part of the preliminary stage, indicating the DGT’s expectation of meticulous and well-supported transfer pricing analyses conducted by taxpayers.
In conclusion, PMK-172 reflects the Indonesian government’s commitment to addressing some of the most controversial transfer pricing issues and promoting clarity and certainty. While it brings new opportunities, it also presents challenges. Taxpayers are strongly advised to evaluate the implications of these new guidelines on their businesses in Indonesia to navigate this transformative regulatory landscape successfully.
In a significant move to bolster economic resilience and sustainability, Singapore’s Deputy Prime Minister and Minister for Finance, Mr. Lawrence Wong, unveiled the ambitious Singapore Budget 2024 on February 16, 2024. Amidst global economic fluctuations and a pressing climate crisis, the Budget strategically addresses the dual challenges of rising operational costs and the imperative for sustainable development, marking a pivotal step towards fortifying Singapore’s position as a competitive and green economy.
In anticipation of global tax reforms, Singapore’s proactive steps to implement the Income Inclusion Rule (IIR) and Domestic Top-up Tax (DTT) under the BEPS 2.0 framework demonstrate a forward-looking approach to ensure tax compliance and fairness. These measures reaffirm Singapore’s commitment to international tax standards while safeguarding its economic interests.
Transfer pricing highlights from the Singapore Budget 2024 include:
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
New Report from Dezan Shira & Associates: China Takes the Lead in Emerging Asia Manufacturing Index 2024
China has been the world’s largest manufacturer for 14 years, producing one-third of global manufacturing output. In the Emerging Asia Manufacturing Index 2024, China ranks highest among eight emerging countries in the region. Challenges for these countries include global demand disparities affecting industrial output and export orders.
Known as the “World’s Factory”, China has held the title of the world’s largest manufacturer for 14 consecutive years, starting from 2010. Its factories churn out approximately one-third of the global manufacturing output, a testament to its industrial might and capacity.
China’s dominant role as the world’s sole manufacturing power is reaffirmed in Dezan Shira & Associates’ Emerging Asia Manufacturing Index 2024 report (“EAMI 2024”), in which China secures the top spot among eight emerging countries in the Asia-Pacific region. The other seven economies are India, Indonesia, Malaysia, the Philippines, Thailand, Vietnam, and Bangladesh.
The EAMI 2024 aims to assess the potential of these eight economies, navigate the risks, and pinpoint specific factors affecting the manufacturing landscape.
In this article, we delve into the key findings of the EAMI 2024 report and navigate China’s advantages and disadvantages in the manufacturing sector, placing them within the Asia-Pacific comparative context.
Emerging Asia countries face various challenges, especially in the current phase of increased volatility, uncertainty, complexity, and ambiguity (VUCA). One notable challenge is the impact of global demand disparities on the manufacturing sector, affecting industrial output and export orders.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
- China Implements New Policies to Boost Foreign Investment in Science and Technology Companies
- Q1 2024 Brief on Transfer Pricing in Asia
- New Report from Dezan Shira & Associates: China Takes the Lead in Emerging Asia Manufacturing Index 2024
- Is journalist Vicky Xu preparing to return to China?
- Guide for Foreign Residents: Obtaining a Certificate of No Criminal Record in China
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