China
Caribbean countries turn to China’s Belt and Road
Author: Jared Ward, University of Akron
China’s ability to connect Caribbean nations to the Maritime Silk Road is an important barometer of the Belt and Road Initiative’s (BRI) global applicability. In recent years, the United States has become an absent steward over the Caribbean. Aid is dwindling, ambassador posts remain empty, and a chorus of Caribbean leaders are showing a willingness to accept BRI funding as a way to meet badly needed infrastructure improvements.
Beijing is throwing a lifeboat to many small Caribbean nations, attempting to sell its model of development to a region saturated with US influence. The increasingly prominent Chinese presence — coupled with generous and sometimes exorbitant loan terms — is promulgating fears that Beijing is laying a ‘debt trap’ to secure assets such as land in the United States’ backyard.
But seeing the BRI as a real-estate grab is short sighted and rehashes Cold War warnings that Chinese money comes with uniquely sinister strings attached. As a study from the Rhodium Group shows, China re-negotiates loan terms far more often than it seizes assets, as in the oft-cited Sri Lankan Hambantota Port.
Western fears about Caribbean nations being saddled with Chinese debt are selective. As recently as 2012, Jamaica’s debt was 147 per cent of its GDP, but most is owed to Western lending institutions like the IMF, the World Bank and the Inter-American Development Bank. Money from Beijing’s EXIM Bank only accounts for 3.9 per cent of Jamaica’s overall debt, even though the country is China’s largest trading partner in the Caribbean.
The Caribbean Development Bank estimates that the region still needs a further US$30 billion in infrastructure. China is attempting to show it is best-suited to meeting these needs through low interest rates and a steady flow of cash.
A number of Caribbean nations — including Antigua and Barbuda, Jamaica, Guyana, Barbados and Trinidad and Tobago — have agreed to officially join the BRI. Guyanese President David Granger captured the cycle many small Caribbean nations face: ‘We cannot develop without infrastructure and we just do not have the capital to do it on our own. So whether it comes from America, China or Britain, we have to have it and of course we have to look for the best deal’.
Off the shores of the Bahamas, a Hong Kong business has spent US$3 billion to complete the Freeport Container Port, a deep-water port capable of handling Chinese super tankers travelling through the Panama Canal. The China Harbour Engineering Company (CHEC) has built roads zigzagging through Jamaica, including a US$730 million highway linking Kingston to Ocho Rios, and has earmarked another US$348 million for a highway along the underdeveloped southern coast. In Guyana, the CHEC is working on a US$150 million expansion of the Cheddi Jagan International Airport.
China’s goals in the Caribbean are a mix of political and economic. A stable US economy undergirds the markets of the Western hemisphere so it is unlikely that Beijing sees direct competition with the United States in the Caribbean as in its best interests. But the Caribbean is home to over half of Taiwan’s remaining diplomatic allies and the BRI’s ‘One China’ pre-requisite may help Beijing further isolate Taipei.
China has pledged billions to revamp infrastructure in the capital of Haiti, one of Taiwan’s oldest allies. Haitian President Jovenel Moise’s regime has signalled that its friendship with Taipei should not be taken for granted: ‘Taiwan is a long-time friend … [but] Haiti is looking for where its interests lie’.
The Caribbean is also home to growing deposits of oil, bauxite and magnesium. China is becoming entangled in Guyana’s natural resource wealth. As many as 4 billion barrels of oil have been found off the coast of Guyana, making the nation poised to become a serious oil producer. The China National Offshore Oil Corporation owns 25 per cent of potential oil findings in the country, while the Bosai Mineral Group is expanding magnesium and bauxite operations. In Jamaica, Jiuquan Iron and Steel announced plans in 2019 to invest over US$3 billion in an aluminium refinery and smelter, adding to a US$300 million refinery purchased in 2016.
While the United States is working to keep Huawei from operating within its borders, the embattled Chinese tech firm is weaving a digital silk road. In partnership with the Caribbean mobile phone company Digicel, Huawei has agreed to expand 4G and 5G coverage to Jamaica, Trinidad and Tobago, Barbados and…
China
New Publication: A Guide for Foreign Investors on Navigating China’s New Company Law
The sixth revision of China’s Company Law is the most extensive amendment in history, impacting foreign invested enterprises with stricter rules on capital injection and corporate governance. Most FIEs must align with the New Company Law by July 1, 2024, with a deadline of December 31, 2024 for adjustments. Contact Dezan Shira & Associates for assistance.
The sixth revision of China’s Company Law represents the most extensive amendment in its history. From stricter capital injection rules to enhanced corporate governance, the changes introduced in the New Company Law have far-reaching implications for businesses, including foreign invested enterprises (FIEs) operating in or entering the China market.
Since January 1, 2020, the Company Law has governed both wholly foreign-owned enterprises (WFOEs) and joint ventures (JVs), following the enactment of the Foreign Investment Law (FIL). Most FIEs must align with the provisions of the New Company Law from July 1, 2024, while those established before January 1, 2020 have bit more time for adjustments due to the five-year grace period provided by the FIL. The final deadline for their alignment is December 31, 2024.
In this publication, we guide foreign investors through the implications of the New Company Law for existing and new FIEs and relevant stakeholders. We begin with an overview of the revision’s background and objectives, followed by a summary of key changes. Our in-depth analysis, from a foreign stakeholder perspective, illuminates the practical implications. Lastly, we explore tax impacts alongside the revisions, demonstrating how the New Company Law may shape future business transactions and arrangements.
If you or your company require assistance with Company Law adjustments in China, please do not hesitate to contact Dezan Shira & Associates. For more information, feel free to reach us via email at china@dezshira.com.
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
Lingang New Area in Shanghai Opens First Cross-Border Data Service Center to Streamline Data Export Process
The Lingang New Area in Shanghai has launched China’s first Cross-Border Data Service Center to facilitate data export for companies in Shanghai. The center will help with applications, data catalogs, and management, aiming to provide legal and safe cross-border data transfer mechanisms.
The Lingang New Area in Shanghai’s Pilot Free Trade Zone has launched a new cross-border data service center to provide administrative and consulting services to companies in Shanghai that need to export data out of China. The service center will help facilitate data export by accepting applications from companies for data export projects and is tasked with formulating and implementing data catalogs to facilitate data export in the area. The Shanghai cross-border data service center will provide services to companies across the whole city.
The Lingang New Area in the Shanghai Pilot Free Trade Zone has launched China’s first Cross-Border Data Service Center (the “service center”). The service center, which is jointly operated by the Cybersecurity Administration of China (CAC) and the local government, aims to further facilitate legal, safe, and convenient cross-border data transfer (CBDT) mechanisms for companies.
The service center will not only serve companies in the Lingang New Area but is also open to companies across Shanghai, and will act as an administrative service center specializing in CBDT.
In January 2024, the local government showcased a set of trial measures for the “classified and hierarchical” management of CBDT in the Lingang New Area. The measures, which have not yet been released to the public, seek to facilitate CBDT from the area by dividing data for cross-border transfer into three different risk categories: core, important, and general data.
The local government also pledged to release two data catalogs: a “general data” catalog, which will include types of data that can be transferred freely out of the Lingang New Area, and an “important data” catalog, which will be subject to restrictions. According to Zong Liang, an evaluation expert at the service center, the first draft of the general data catalog has been completed and is being submitted to the relevant superior departments for review.
In March 2024, the CAC released the final version of a set of regulations significantly facilitating CBDT for companies in the country. The new regulations increase the limits on the volume of PI that a company can handle before it is required to undergo additional compliance procedures, provide exemptions from the compliance procedures, and clarify the handling of important data.
Also in March, China released a new set of technical standards stipulating the rules for classifying three different types of data – core, important, and general data. Importantly, the standards provide guidelines for regulators and companies to identify what is considered “important” data. This means they will act as a reference for companies and regulators when assessing the types of data that can be exported, including FTZs such as the Lingang New Area.
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
A Concise Guide to the Verification Letter of Invitation Requirement in the China Visa Process
The application procedures for business visas to China have been simplified, with most foreigners now able to apply for an M/F visa using only an invitation letter from a Chinese company. Some countries are eligible for visa-free entry. However, a Verification Letter of Invitation may still be needed in certain cases. Consult the local Chinese embassy for confirmation.
In light of recent developments, the application procedures for business visas to China have undergone substantial simplification. Most foreigners can now apply for an M/F visa using only the invitation letter issued by a Chinese company. Additionally, citizens of certain countries are eligible to enter China without a visa and stay for up to 144 hours or even 15 days.
However, it’s important to note that some applicants may still need to apply for a “Verification Letter of Invitation (邀请核实单)” when applying for an M/F visa to China. In this article, we will introduce what a Verification Letter of Invitation is, who needs to apply for it, and the potential risks.
It’s important to note that in most cases, the invitation letter provided by the inviting unit (whether a public entity or a company) is sufficient for M/F visa applications. The Verification Letter for Invitation is only required when the Chinese embassies or consulates in certain countries specifically ask for the document.
Meanwhile, it is also essential to note that obtaining a Verification Letter for Invitation does not guarantee visa approval. The final decision on granting a visa rests with the Chinese embassy abroad, based on the specific circumstances of the applicant.
Based on current information, foreign applicants in Sri Lanka and most Middle East countries – such as Turkey, Iran, Afghanistan, Syria, Pakistan, and so on – need to submit a Verification Letter for Invitation when they apply for a visa to China.
That said, a Verification Letter for Invitation might not be required in a few Middle East countries, such as Saudi Arabia. Therefore, we suggest that foreign applicants consult with their the local Chinese embassy or consulate to confirm in advance.
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.
- New Publication: A Guide for Foreign Investors on Navigating China’s New Company Law
- Lingang New Area in Shanghai Opens First Cross-Border Data Service Center to Streamline Data Export Process
- A Concise Guide to the Verification Letter of Invitation Requirement in the China Visa Process
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