BJ: On November 30, the Civil Affairs organised an annual meeting for all 19 foreign Chambers of Commerce in Beijing. Ms. Huangru, the Deputy Director General of the administration office at the Civil Affairs, initiated the meeting and welcomed all the representatives. Director Kexiaoshan followed with an update about policies related to foreign Chambers in China, and section chief Song Zhongwei concluded the first part with a general summary of last year’s working reports from all the Chambers.

For the second part of the meeting, all the Chambers took turns to present this year’s main events and activities. SwedCham presented activities in relation to the 20 years’ celebration earlier this year, as well as examples on how some of our member companies have implemented the No Plastic Challenge.

Thanks to the Civil Affairs for organising the meeting; it was a great opportunity to learn about the different policy updates and to hear different successful stories from other Chambers.

On August 31 2018, the National People’s Congress Standing Committe officially passed the new Individual Income Tax (IIT) reform, which will be implemented in January 2019.

Earlier this week we had full house at Four Seasons Hotel Shanghai hosting an event dedicated to the topic of IIT, discussing how it will effect companies in China. The two draft rules of the IIT provided more details on the changes brought about by the new law which include the amendments on five-year rule, defining of China sourced income, requirement of annual reconciliation, elaboration on anti-avoidance rules and rules in relation to specific additional deductions etc.

The tax payers and employers should have a comprehensive understanding of the new regulations and get fully prepared to embrace the changes.

Click here to access upcoming SwedCham events!

China’s Singles’ Day just passed and broke records the first hour during midnight with an increase of $4 billion in sales from the previous year.

Singles’ Day, also referred as Double 11, is a shopping event day in China similar to Black Friday in the U.S., where many E-commerce companies have discounted prices on their products. One of them is the E-commerce giant Alibaba which is constantly breaking records by selling millions of goods. This year’s Singles’ Day Alibaba surpassed an amount of $31 billion, about $4 billion more in sales than last year, through their E-commerce site Taobao.

Singles’ Day and Black Friday are considered to be the biggest shopping event days of the year. According to thebalance.com, last year’s Black Friday had a total sales of $8 billion, while Singles’ Day had $31 billion in sales this year.

But what is it that really distinguishes these two shopping event days except the number in sales? While trends are widely different in China compared to the west, there’s a clear distinction between these two shopping festivals, Black Friday is aimed towards shopping in physical stores while Alibaba’s sales derives from its E-commerce business.

Consumption patterns also widely differ from Black Friday and Singles’ Day. China is known to be a country of materialism, where luxury items and expensive accessories symbolize a rich lifestyle and high status in society. This gives a rise to the high consumption rate of goods among the Chinese middle-class in the country as well as abroad. In Sweden people tend to spend more money on things like travelling and other experiences, not really having the same view of a prestigious image obtained through materialistic goods.

However in Sweden, we see very different trends. Our shopping festivals can’t be said to be placed on one particular day, instead we have periods which provide discounted goods. The biggest one starting shortly after Christmas and ending before the New Year. As the shopping trends in Sweden along with its population are widely different from China, the numbers in sales of Singles’ Day and other shopping festivals will likely not be experienced in Sweden. Even the biggest Swedish companies, for instance IKEA, had an annual revenue of about $40 billion in the fiscal year of 2017, which is just a little more than what Alibaba experienced on Singles’ Day only.

China’s Singles’ Day event is also getting traction in other countries, Russia and the U.S. are two examples already committed to the Chinese shopping event day in terms of spending. More countries are now acknowledging foreign shopping event days such as Singles’ Day and start adopting these as local shopping festivals.
Although in response to these shopping event days and festivals, several movements against these days dedicated to excessive consumption of goods have taken form. Among these movements is ‘White Monday’. White Monday was first established in 2017 with an origin in Sweden, hence having a large amount of Swedish speakers & supporters. To this day, the movement has support from many big organizations like WWF, SSNC and several companies. One of the criticial points made from these movements, is particularly the impact large consumption of products leaves on the environment.

While Sweden has a long way to go to reach the same E-commerce trend that is being experienced in China, how will shopping festivals evolve from here? According to an article publicized by Tom Popomaronis on Forbes.com, shopping trends will evolve to be completely different from our traditional ways of shopping. The article conveys ideas that drop-shipping, automatic replenishment and AI will play a large role in replacing physical shopping in stores. The article adds that augmented reality, which is a perceptual world that is generated by a computer, will also be a thing where consumers can try goods through immersive virtual experiences.

Written
by
André Bengtsson, intern at SwedCham in China

BJ: Yesterday the Beijing office, together with the other Nordic Chambers, invited Co-founder of Trivium China, Andrew Polk, to discuss US and Chinese relations after the US midterm elections.

Since this summer, said Polk, the trade war has entered a new, deeper, and protracted phase. From the US side the dissatisfaction with China is unanimous, which means that the US midterms elections is likely to have little impact on the trade war. The Trump administration sees a depreciating CNY and a falling stock market as a sign that China is on the brink of economic collapse and that they have the upper hand in the trade war. This however, according to Polk is an over-estimation of its own leverage.

From the Chinese side trade issues was originally the key focus of the negotiations, but seems now to have less priority than before. Now the Chinese leaders does not seem to be too worried about trade and think that they have the upper hand politically and can outlast Trump. “So far, they have not felt any real pain. Once it goes in to tech, investments etc. then it is a different story. The key, however to remember is that China does not want this war”, said Polk.

“So far, they have not felt any real pain. Once it goes in to tech, investments etc. then it is a different story,” Andrew Polk

One thing is certain, there is no a quick fix to the trade war, as deeper structural issues needs to be addressed. “The Trump administration wants a concrete set of deliverables on Made in China 2025 to even restart the trade war talks, which is very unlikely to happen as Chinese leaders now sees the trade war as part of a concerted long-term effort to thwart China’s rise, and therefor wary to come to the negotiating table at all”, said Polk.

So far there are few genuine macro effects caused by the trade war. Before anything happens, predicts Polk, both sides will need to feel some genuine pain for anything to change. “Even if a deal is made in one month, or in 6 months, it is only going to be a pause in the trade war, not the end of it, because we have not since any real pain yet.”

“If a deal is made in one month, or even in 6 months, it is only going to be a pause in the trade war, not the end of it, because we have not since any real pain yet,” Andrew Polk

Benjamin Wang, International Business Chief of Staff, told the story of how it all started 6 years ago when the founder of Didi Dache, Cheng Wei, was tired of having difficulties to find a taxi, particularly during rush hour and that he missed several flights because he could not hail a cab in time. “To create an interest for and traffic on the APP in the beginning, we had our office personal acting as customers and drivers driving around in the city during office hours”. 

“To create an interest for and traffic on the APP in the beginning, we had our office personal acting as customers and drivers driving around in the city during office hours” – Benjamin Wang

SwedCham is looking for two interns with passion for communication

Do you have a passion for business relations and want to develop your skills? We are now looking for 2 motivated intern to join SwedCham’s Beijing and Shanghai office respectively during spring 2019.

The Swedish Chamber of Commerce in China is an independent, non-profit member organization, network and platform for Swedish businesses and decision makers in China. The Chamber regularly arranges activities for its members such as seminars, workshops, social activities and other network opportunities. The Chamber is a part of the local team Sweden effort together with the Embassy in Beijing, the Consulate General in Shanghai, Business Sweden and Visit Sweden, and works to build a stronger Swedish community in China.

The purpose of the internship is for you to get integrated in the daily work, and get an insight of how a foreign Chamber of Commerce operates.

Key Responsibilities

• Preparing, marketing and executing events
• Maintaining and managing SwedCham’s social media sites; LinkedIn, Facebook, Instagram
• Producing content for Social media articles, briefs and press releases
• Designing SwedCham’s marketing collaterals, e., event posters, flyers, web banners etc.
• Assisting office management in daily work

Requirements

• Internships last for 4 months’ minimum starting January 2019
• Excellent command of business English. Swedish and Mandarin are highly meritorious
• Excellent communication skills and previous experience from working with social media. Previous experience from analyzing social media is highly meritorious.
• Comfortable in social environments
• Knowledge of Adobe CS4 (Premiere PRO, Illustrator CS5, Photoshop CS5) or InDesign is an asset
• The candidate should have a legal right to intern in China. This means that you are required to be a student holding an X2 visa, enrolled at a Chinese university pursuing a degree within a relevant field, g. Economics, International Business, Political Science, Law, Marketing and Communications etc. And that you are able to get a permit from your university that allows you to do out of campus activities. We also accept students that are enrolled at a Swedish University and have an internship semester included in your program.

Practical Details
The internship is unpaid. You are required to have a valid insurance during the time of the internship. Interns are responsible for finding their own housing.

Deadline
Please submit your cover letter and CV before November 30 to Erika@Swedcham.cn for Beijing and Emma@swedcham.cn for Shanghai. Positions are filled continuously.