Reader's Digest > 16 August - 29 August

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Reader's Digest, 16 - 29 August 2014

Swiss and Chinese Business Related News in Switzerland and China

BILATERAL RELATIONS

Visit from the Chinese Ambassador in Switzerland to Lucerne
Published by China Embassy in Switzerland, 18th August 2014
The Chinese Ambassador in Switzerland Ms. Xu Jinghu paid a visit to the canton of Lucerne on 12 August 2014. Ambassador Xu was welcomed by the President of the government and the authorities of the canton. The President indicated that Lucerne is one of the most powerful cantons in Switzerland and is enjoying very good relations with China. In 2013, the hotel industry in Lucerne registered more than 200,000 overnight stays from Chinese tourists. Three years ago, the canton of Lucerne established relationship with the province of Jiangsu, establishing very good cooperation in numerous fields. Ambassador Xu expressed the hope that with the rapid improvement of Sino-Swiss bilateral relations, the government of Lucerne would continue its cooperation with China and actively contribute to the development of the Sino-Swiss relations.
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BUSINESS NEWS

Swiss Companies in China Particularly Successful
Published by swisscenters.org, 25th August 2014
In 2014, sales and profits of Swiss companies in China are in continued acceleration. Swiss companies expect a profit increase of 5.6% on average, year-on-year, according to the recent “Business in China 2014 Survey”. China is becoming a venue for SME success: Swiss SMEs achieve better results than larger companies. Swiss companies remain the most confident about their business in China in the next 5 years, and almost two third of Swiss companies plan to increase investments in China. Finding and retaining human resources remains the biggest challenge. Private Chinese companies rise to become the fiercest competitors.

Swiss Exports Rise in July as European Demand Picks up
Published by reuters.com, 21st August 2014
Switzerland's exports rose in July, driven by chemical and pharmaceutical products and a pickup in demand from Europe, data from the Federal Customs Office showed on Thursday. Exports to Europe rose 8%, including a 13.9% increase to Germany, Switzerland's biggest trading partner, the office said. Europe absorbs almost 60% of Swiss exports. A strong Swiss franc has made Swiss goods more expensive abroad, but that effect has been softened by a cap on the value of the franc that the Swiss National Bank imposed almost three years ago. Exports rose an inflation-adjusted 4.5% year-on-year in July to CHF 19.258 billion (USD 21.09 billion), or 5.0% on a nominal basis, the data showed. In July, exports of watches rose a nominal 2.2 % to CHF 2.1 billion. Sales to mainland China jumped 49%, their best performance in 30 months, the Federation of the Swiss Watch Industry said. Imports to Switzerland fell 4.6% in real terms and 3.5% in nominal terms. Imports of energy sources and consumer goods in particular weakened. The trade surplus widened to CHF 3.98 billion in July from a revised CHF 1.41 billion a month earlier.

Swiss Central Banks Swell Rush to Hold Renminbi
Published by ft.com, 20th August 2014
Adopted at pace by central banks around the world, China’s renminbi is now seen by many as a de facto reserve currency – and well on the way to becoming an official one. Central banks have caught the renminbi fever, and are showing strong interest in investing part of their foreign-currency reserves in the Chinese currency, with more than 50 central banks now actively doing so either onshore or offshore. Uptake is strongest in Asia, Africa and South America – regions with fast-growing trade and investment links with China – but even in Europe central banks are busy allocating reserves to the renminbi. Earlier this year, Banque de France announced it is active in the renminbi market, and in July the Swiss National Bank received a RMB billion investment quota from the People’s Bank of China (PBOC), the Chinese central bank. The actions of these two large and sophisticated players are likely to reverberate in the European central-bank community, sparking others to follow.
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CULTURE & SOCIETY

Needle-ArtHand Embroideries from China and Switzerland
Published by sinoptic.ch, 16th August 2014
“Nadelkunst–Handstickereien aus China und der Schweiz”, the upcoming exhibition at Haus Appenzell in the centre of Zurich, presents hand embroideries originating from China and the East of Switzerland. The exhibits on display range from children’s bonnets to insoles and from white to colourful. Some of them bear significant symbolic meaning, others are purely beautiful to look at. The garments, accessories, everyday objects, and ornaments were artfully embroidered by members of Chinese nationalities and Swiss women, respectively, and demonstrate vividly how a traditional craftwork is performed in different cultures. Furthermore, the exhibition offers a glimpse at the latest embroidery trends in fashion design.
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GENERAL INTEREST

Israel-China Fund to Play Pivotal Role in Swiss Firm
Published by timesofisrael.com, 25th August 2014
As part of Israel’s business efforts to build long bridges, the Israel-China investment fund Catalyst CEL is investing USD 42 million in Switzerland-based Lamina Technologies - a manufacturer of precision carbide metal cutting tools originally established in Israel. The deal shines a light on Israel’s role in bringing the tech world’s “old” and “new” economies together. Alongside its good business aspect, Israel has helped enhance relationships between entrepreneurs and investors from around the world, bringing innovations to people far beyond its borders.

Partners Group Strikes First China Buyout
Published by wsj.com, 21st August 2014
Partners Group is giving a lift to one of the world’s largest makers of elevator parts. The publicly traded Swiss investment firm said it has led its first buyout deal in China, acquiring a controlling stake in elevator parts manufacturer Suzhou Savera Shangwu Elevator Riding System Co., Ltd in an all equity deal of more than USD 450 million in value. As China’s population has become more affluent and its town and cities become more urbanized, it puts pressure on the limited land area that can be developed, according to Kelvin Yu, a managing director in Partners Group’s Shanghai office.

Annual Meeting of the New Champions - Tianjin, China, 10-12 September 2014
Published by weforum.org, 18th August 2014
Established in 2007 as the foremost global gathering on science, technology, and innovation, the Annual Meeting of the New Champions convenes the next generation of fast-growing enterprises shaping the future of business and society together with leaders from major multinationals as well as government, media, academia and civil society. Meeting under the theme Creating Value through Innovation, more than 1,500 participants from 90 countries will focus on how innovation can generate more and better value for all – for the people we serve, the organizations we lead and the societies to which we belong.
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INDUSTRIES

Engineering / Manufacturing

Straumann Reports Solid Revenue Growth and Sharp Rise in Profitability
Published by .straumann.com, 28th August 2014
In the first six months of 2014, the Straumann Group posted solid revenue growth in local currencies. Despite currency headwind, profitability increased significantly, thanks to operational leverage and the full benefit of cost-reduction initiatives implemented last year. Strong demand for dental implants spurred growth in local currencies to 5% but unfavorable exchange rates reduced the increase in Swiss francs by 3%, bringing revenue to CHF 359 million. All regions posted first-half increases with Asia/Pacific and North America delivering almost two thirds of the overall growth. After a strong first quarter, revenue growth slowed expectedly in Q2, reflecting the Easter effect. Sales accelerated in China, where Straumann has recently taken a significant step to broaden its footprint and increase its business. Since 2003, the Group has operated through a single distributor, Beijing Finest Medical Group (BJFM), which had an important role in establishing Straumann as a market leader, particularly in the public hospital segment. However, with the private-practice segment growing rapidly and the market expanding geographically, a broader approach is needed.

Straumann Passes on Nobel Biocare, Eyes China Instead
Published by reuters.com, 26th August 2014
Straumann, the world's largest maker of dental implants, has no interest in joining the suitors for No.2 player Nobel Biocare, preferring instead to go after deals in the fast-growing Chinese market, it said on Tuesday. The Swiss firm, battling sliding sales in its main market of Europe, has stepped up its investments in the Asia/Pacific region, where one in every five dental implants is sold. Chief Executive Marco Gadola said the company was strong enough in the premium section of the industry - where local rival Nobel Biocare is also a force - but was scouting for further growth opportunities in China, where the market for lower-priced implants is growing at a rate of 20 to 30%. "We are actively looking at potential partners to develop that segment in China," he told Reuters in an interview, adding deals could be in the range of CHF 10-100 million (USD 11-110 million).

Novartis Licenses Drugs to Non-Profit TB Group
Published by yahoo.com, 21st August 2014
Swiss-based pharmaceuticals giant Novartis said Wednesday that it had signed a licensing deal with an international organisation that fights tuberculosis. In a statement, the group said that the exclusive worldwide licensing agreement with the Global Alliance for TB Drug Development covered compounds discovered at the Novartis Institutes for Tropical Diseases. All told, TB claimed 1.3 million lives worldwide last year, making it the deadliest disease after AIDS to be caused by a single infectious agent, according to the World Health Organization. WHO figures show that there are 8.6 million cases of TB every year, and that drug-resistant forms are a huge emerging threat. The disease is global, but its hotspots include China, India and the former communist countries of Eastern Europe and central Asia.
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Bank / Finance / Insurance

China's Growth Recovery Takes Pause but Remains on Track
Published by China Daily, 25th August 2014
China's economic recovery took a temporary pause in July owing to weaker domestic investment demand, but it still remained on track, said Wang Tao, chief China economist at Switzerland's largest bank UBS, in a research note. China's macro economic data for July suggested the economic rebound since early this summer has taken a temporary pause, she said. Although industrial production growth still printed a respectable 9.0% year-on-year despite last year's high base, growth momentum moderated slightly compared to June and was lower than expected.

Fosun Looks to Extend Presence in Insurance
Published by China Daily, 20th August 2014
Fosun International Ltd, the investment arm of China's biggest closely held conglomerate, is in talks to acquire the US life insurance arm of Swiss Re Ltd, people with knowledge of the matter said. Fosun is seeking to buy Aurora National Life Assurance Co for USD 400 million to 500 million, said the people, who asked not to be identified because the matter is private. A deal has not been reached and the talks could still fall through, said the sources. Zurich-based Swiss Re began working with Barclays Plc last year to sell Aurora, a life insurance and annuity provider based in Hartford, Connecticut, the sources said. Wilton Re Holdings Ltd, the Bermuda-based reinsurer backed by Canada Pension Plan Investment Board, had also expressed interest in Aurora, one person said.

UBS Podcast: UBS FX Strategist Talks About the RMB Movement
Published by ubs.com, 18th August 2014
With the Federal Reserve lowering its outlook for the US economy and long-term rates, UBS FX strategist, Geoffrey YU, expects the low volatility market environment to continue. He advises investors to focus on high-yielding currencies, especially in emerging markets and, in particular, the RMB. In the short term, YU expects a return of inflows into China, which will increase the value of the RMB. As a result, the USD/RMB rate could trade below 6.20 in the near future. The forecast USD/RMB rates for 2014 and 2015, respectively, are 6.25 and 6.35.
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Hospitality / Tourism / Retails

Anti-Monopoly Actions Unlikely to Affect Swiss Companies
Published by China Daily, 20th August 2014
If China's anti-monopoly regulations follow international norms, it would not affect Swiss companies too much, the head of the Swiss Center Shanghai said. Managing Director Nicolas Musy of the center said that almost all the Swiss companies active in China are also active in other key markets including the United States. Musy said that the Swiss companies will not be affected much if China complies with international anti-monopoly practices. China and Switzerland have seen a decade of growth in bilateral trade and investment. Many well-known Swiss companies, such as food and beverage company Nestle, pharmaceutical company Novartis AG, and elevator and escalator manufacturer Schindler Group, have set up production and research and development centers in China. Musy also revealed that Swiss companies remain the most confident about their businesses in China in the next five years, and almost two-thirds of Swiss companies plan to increase investments in the country.
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Legal / Trade / Consulting / Services

Intellectual Property in China: Another Approach?
Published by sccc.ch, 23rd August 2014
In collaboration with the Chamber of commerce and industry of the canton de Vaud and the Swiss Chinese Society (section romande), the Swiss Chinese Chamber of Commerce section romande will organize a conference on the topic “Intellectual Property in China” in Lausanne on Wednesday 3 September 2014. Invited by the Chamber, Mr. Jean-Christophe Liebeskind, Head of Chinese Desk at Meyerlustenberger Lachenal and Counsel at Global Law Office, a Chinese law firm with offices in Beijing, Shanghai and Shenzhen, will give a presentation on intellectual property in China followed by a Q&A session.
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