Reader's Digest > 1 August - 14 August

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Reader's Digest, 1 - 14 August

Swiss and Chinese Business Related News in Switzerland and China


Federal Council Enhances Structure for Negotiations with EU
Published by, 12th August 2015
On 24 June the Federal Council reasserted its general objective of ensuring greater control over migration and bringing the bilateral approach up to date. In order to increase the chances of achieving an overall outcome that is balanced and clearly in the interests of Switzerland, it also mandated the FDFA to propose a strengthening of the negotiating structure. Accordingly, the Federal Council has decided to establish a structure for the overall conduct of negotiations, focusing in particular on the free movement of persons, institutional issues, market access agreements, new or expanded cooperation (in research, education, culture, etc.) and the question of renewing the enlargement contribution. Mr. de Watteville will be responsible for coordinating the negotiations and ensuring an overall outcome based on the Federal Council's strategy. Mr. de Watteville was the former Ambassador of Switzerland to the People's Republic of China, the Democratic People’s Republic of Korea and Mongolia and arrived at Beijing in September 2012.

The Sino-Swiss Relations are Avant Garde
Published by Luigi Jorioand Shao Dahai,, 29thJuly 2015
This year China and Switzerland is celebrating 65th anniversary of the establishment of bilateral relations between two countries. It is a great opportunity to talk about relations between two countries, as well as major issues such as the Free Trade Agreement, human rights and climate change, etc. The Ambassador of China in Switzerland Ms. XU Jinghu is interviewed by Switzerland was one of the first Western countries to recognize the People’s Republic of China in January 1950. This decision was both pragmatic and visionary.Berne and Beijing "have in general a healthy and stable relationship which is currently even at the best time in the history", said XUJinghu, Ambassador of China in Switzerland since 2013.The first joint venture that was set up between a Chinese and a foreign company was established with the Swiss company Schindler, in 1980. Switzerland is the first Western country to recognize China as a market economy in 2007. It is also the first with a top 20 world economy that signed the Free Trade Agreement with China. In March, Switzerland signed the document marking the country’s participation in the founding process of the Asian Infrastructure Investment Bank (AIIB).
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Swiss Stocks Fall as China Rattles Luxuries
Published by, 11thAugust 2015
Swiss stocks fell sharply Tuesday, following global markets into the red after China's surprising currency devaluation.The Chinese government caused the yuan's biggest one-day loss since 1994, when it unified official rate with market rates.The move makes foreign goods such as Swiss luxury brands more expensive for Chinese consumers.The Swiss Market Index dropped 0.91% to 9,424.41.Swatch shares plunged 5.1%, Richemont fell 4.1%.Banks Julius Baer and UBS also fell, although losses were less pronounced.Human resource provider Adecco declined 3.6% after reporting second-quarter results.

Swissport Sold to Chinese Group
Published by, 1stAugust 2015
The Zurich-based airport luggage handler Swissport has been sold to the HNA Group, owner of China’s fourth-largest airline, for CHF 2.73 billion (USD 2.8 billion). PAI Partners, the owners of Swissport, concluded the deal with the Haikou-based group which owns the Chinese airline company Hainan airlines. The HNA Group joined the Fortune Global 500 List for the first time this month with an annual revenue of around USD 25.6 billion and assets worth almost $80 billion. PAI Partners had acquired Swissport in 2010 for USD 900 million. Swissport is the world’s leading services company for airlines and airports providing cargo- and ground-handling services to 700 aviation clients. The firm employs more than 60,000 staff and is active in 260 locations in 45 countries. It generates an annual revenue of CHF 3 billion. The company was founded in 1996 as a subsidiary of the former Swissair (now Swiss International Air Lines) and was then known as Swissair Ground Services International. It was sold in 2002 following the financial crisis at Swissair.

New Wave of World-Beating Companies
Published by China Daily, 1stAugust 2015
A new wave of Chinese companies is riding on a disruptive method of globalization that allows them to challenge Western incumbents much quicker and effectively, says Howard Yu, professor of strategic management and innovation at IMD Business School in Lausanne, Switzerland.Although traditionally Chinese companies have become globally competitive by leveraging their economies of scale rooted in the vast Chinese consumer market, this new wave of Chinese firms competes on creative use of digital technology and close interaction with consumers in each overseas markets, he says.
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Statistics on Tourist Accommodation in June and in the First Half of 2015
Published by, 4thAugust 2015
The statistics shows the decrease in overnight stays in the first half of 2015 and slight increase in June 2015. The hotel sector registered 17.0 million overnight stays in Switzerland during the first sixth months of 2015. This represents a decrease of 0.6% (-109,000 overnight stays) compared with the same period a year earlier. Foreign visitors registered 9.3 million overnight stays, i.e. a decline of 1.9% (-179,000 units). With a total of 7.7 million overnight stays, domestic demand posted a gain of 0.9% (+70,000 overnight stays). During the month of June 2015, 3.2 million overnight stays were generated, corresponding to a rise of 0.2% (+5800 overnight stays) compared with June 2014. These are the provisional results from the Federal Statistical Office (FSO).

Mount Emei Marriage Stone to Settle in Mount Rigi in this July
Published by, 1stAugust 2015
In the end of July Mount Emei marriage stone will settle in Mount Rigi in Switzerland after 8,000 km long trek. Since last September when Mount Emi and Rigi gave each other a marriage stone, the two mountains have built better relationship and facilitated further cultural exchange between China and Switzerland.The two mountains have similar peaks. On both summits can one appreciate intoxicating scenery, fascinating sunrise and sunset.In 2009 representatives of the two scenic areas signed a contract in Mount Emei and formally established partnership. They agreed on a three-year cooperation plan. In July, 2010 representatives of Mount Emei scenic area visited Mount Rigi accompanied by China's representatives to the Chinese consulate general in Zurich and joint a signing ceremony in Mount Rigi with representative of Mount Rigi. In November, 2012 Mount Emei witnessed the friendly exchange between the two sister mountains.In September, 2014 Rigi stone, a symbol of friendship between China and Switzerland traveled from far away to settle in Mount Emei. The 2.5 tons of Rigi stone had its home on the golden top at an altitude of 3079 meters of Mount Emei.

Zurich University of the Arts Helps Launch Design School in Shenzhen
Published by, 31thJuly 2015For more than three years, the Zurich University of the Arts (ZHdK) has played a significant role in a project to develop a design school in Shenzhen in the Chinese province of Guangdong. The project is part of a strategy by the Canton of Zurich to step up cooperation with this economically strong province, including the education sector. On 28 July, a cooperation agreement was signed by the Shenzhen Government and the three partner schools ZHdK, Harbin Institute of Technology (HIT Shenzhen) and the Institute for Advanced Architecture of Catalonia (IAAC). The agreement follows on from a preliminary project that has been developed by the partner schools under the leadership of ZHdK.The Shenzhen International Graduate School of Design is the largest project ever undertaken by a Swiss university in China. The Executive Board of the Universities of Applied Sciences in the Canton of Zurich approved the project in April 2014. The next stage will be to draft the service contracts that will enable the actual work to start.
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Zurich Customs Officials Seize Nearly 600 Pounds of Smuggled Ivory
Published by, 4th August 2015
Customs officials seized nearly 600 pounds of smuggled ivory with an estimated black-market value of around USD 400,000, Swiss authorities said Tuesday. Three Chinese nationals — en route from Tanzania to China - were arrested after officials at Zurich airport found the ivory cache stashed in eight suitcases last month. "This is by far the largest ivory find in Swiss history," Zurich-based customs official MiroslawRitschard told NBC News. He said Tuesday that lion claws and fangs also were discovered during what started out as a "routine screening" at Zurich Airport on 6 July. Officials believe that between 40 and 50 elephants — including several young animals — were killed for the 578 pounds of ivory. Ritschard credited Zurich airport's "special risk profiling" for the discovery, noting that the three smugglers were picked up while in transit from Tanzanian "ivory hot spot," Dar es Salaam.

Top 10 International Destinations for Chinese Millionaires
Published by China Daily, 1st August 2015
China is the world's largest market for outbound tourism and spending. Last year, the number of outbound tourists was 116 million, up 17.8% from a year earlier, and tourist consumption increased 18% to USD 140 billion, the China Tourism Academy said. This year the number of outbound tourists will hit 135 million, the research institution predicts. Based on a Hurun report, traveling remains the most popular leisure pursuit among Chinese millionaires. In the past two years, the Maldives attracted increasing numbers of Chinese millionaires. In a list ranked by the Hurun Report, the Maldives is the No 3 choice for wealthy Chinese visitors while Australia retained top spot followed by France. Switzerland is the No. 5.
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Engineering / Manufacturing

Sulzer Takes Measures in the Pumps Equipment Division
Published by, 10thAugust 2015
Based on the current challenging environment in the oil and gas market, Sulzer decided to take measures to streamline the manufacturing capacities of its Pumps Equipment division.Since the beginning of 2015, Sulzer’s Pumps Equipment division has been organized in three market-oriented business units Oil and Gas, Power, and Water, a dedicated global Parts, Retrofit, and Nuclear Services organization, and a Global Operations network. With the new setup, the company targets to make better use of its capacity and improve quality. At the same time, the oil and gas market remains challenging, leading to low investment levels and project suspensions. Based on this situation, Sulzer decided to react to the current market conditions and to streamline the manufacturing capacities in Brazil, the USA, and China in its Pumps Equipment division. By the end of July 2015, about 410 employees were affected by these restructuring measures.China faced reductions of 80 employees in Dalian and about 20 in Suzhou. These reductions affected employees in the shop floor as well as in administrative functions.

Western Companies Look Hard at China as Growth Slows
Published, 4thAugust 2015
The Chinese slowdown is forcing many Western companies to take a hard look at their businesses there, leading many to reduce investments, costs and product lines and to tackle increasing bad debts.Double digit growth rates during the first decade of the millennium lured scores of Western companies to invest heavily in China. But in recent years growth has slowed sharply, hitting demand and raising doubts about the financial health of Chinese companies.“I'm optimistic long-term and medium-term that China will come back. Short-term, we need to manage through the drought that we see,” said Ulrich Spiesshofer, CEO of Swiss-based industrial conglomerate ABB.ABB is carefully managing costs and working hard to convince customers its products offer value despite premium prices. Stuart Rowley, vice president at Ford Motor Company, said his company had responded to the softening market by cutting production.
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Bank / Finance / Insurance

Credit Suisse Says Chinese Equities Have Returned to Fair Value
Published by, 6thAugust 2015
Chinese stocks have continued their steep decline, with the Shanghai Composite now down 29% from its June 12 high. This has prompted a number of measures from the government as it attempts to stem the rout, and also sparked many analysts’ attempts to figure out what comes next for this massive market.Alexander Redman and Arun Sai at Credit Suisse are the latest to wade in.The analysts say they’ve spent the past five weeks talking to investors in the U.S., Europe, and the Far East, and amid the preponderance of China-related questions (How damaging is the wealth effect of the burst bubble for the Chinese consumer? What evidence is there for any reacceleration in Chinese macro momentum?), one stands out: Have Chinese equities returned to fair value?In an effort to answer that question, the team looked at four different approaches, all of which are based on pricing of MSCI China (which includes H-shares and B-shares) rather than domestically listed A-shares.

Swiss Bank UBP Sees its China Fund Business Doubling by Year-End
Published by, 1stAugust 2015
Swiss private bank Union BancairePrivee (UBP) expects its China asset management business to double in size by the end of this year as it speeds up the expansion to capture wealthy Chinese, a senior UBP executive said.UBP set up the asset management joint venture in China in late 2014, aiming to grow the presence of the company in the Asian market. The firm currently manages USD 400 million."If the market now is stabilizing, I think we can probably easily double (the business) by the end of the year," Nicolas Faller, executive managing director of institutional clients at UBP, told Reuters in an interview.The company also entered the Chinese wealth management market through a partnership with Noah Holdings Ltd, a U.S.-listed Chinese wealth management firm.
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Hospitality / Tourism / Retails

Swatch Group Sees Chinese Devaluation as Positive for Economy, Demand
Published by, 12thAugust 2015
Swatch Group SA said China's devaluation of the yuan will benefit the Swiss watchmaker by boosting the Chinese economy and spurring consumption."We see this measure as positive," Swatch said in an email. "It will stimulate the Chinese economy and this will create more consumption. The Swatch Group with its strong position in all segments in the Chinese mainland market will certainly benefit."The yuan suffered its biggest fall in more than two decades on Tuesday, hitting a three-year low after the Chinese central bank surprised markets by devaluing the currency by almost 2%.

Hilton Worldwide Hotels in China Show Strong Support For China's Sustainable Seafood Festival
Published by, 5thAugust 2015
Hilton Worldwide today announced its participation in the 2015 Sustainable Seafood Festival, organized by the World Wildlife Fund-China (WWF-China) and the Marine Stewardship Council (MSC). Across Beijing and Shanghai, nine Hilton Worldwide hotels are supporting the festival which brings together hotels, restaurants, retailers and suppliers to raise awareness and promote sustainable seafood options. This marks the largest number of hotels from a single hospitality company participating in the festival.From 6-16 August, 2015, participating Hilton Worldwide hotels in China will line up a series of special dining promotions at their restaurants, featuring sustainable seafood dishes, to raise awareness of responsible consumption among guests and members of the public. These menu items use only seafood items that have been certified by the MSC.
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Legal / Trade / Consulting / Services

China Legal Briefing 250
Published by, 4th August 2015
The China Legal Briefing 250 is released: on 13 May 2015, the National People’s Congress released the second draft of the Foreign NGO Management Law (Foreign NGO Law), which is now open for public commenting. This new law, when it comes into force, will be applicable to all non-profit and non-governmental social organizations from outside of mainland China that carry out activities in mainland China and will provide two possible ways for them to legally conduct activities in China. On 10 June 2015, the Legislative Affairs Office of the State Council opened the long-awaited draft of the Environmental Protection Tax Law (EPT Law) for public commenting. This draft EPT Law was jointly drawn up by the Ministry of Finance, the State Administration of Taxation and the Ministry of Environmental Protection. On 4 May 2015, the State Council issued the Decision of the State Council to Abolish Certain Non-Administrative Licensing Items. By this act, the State Council abolished the category of non-administrative licences. 

Global Entertainment and Media Outlook: 2015-2019
Published by, 4th August 2015
Understanding where consumers and advertisers are spending their money in the entertainment and media industry can help inform many important business decisions. But being able to find comparable data, for multiple entertainment and media segments and countries and from a single source, can be a challenge. PwC’s annual Global entertainment and media outlook provides a single comparable source of five-year forecast and five-year historic consumer and advertising spending data and commentary, for 13 entertainment and media segments, across 54 countries.
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