New 10-year visa for Chinese visitors in the U.S.A

A new visa extension for US and Chinese citizens is expected to boost US tourism and is being looked upon as a positive step in relations between the two super powers.
US President Barack Obama announced on Monday in Beijing that the US and China had agreed to a reciprocal 10-year visa policy for tourists and businessmen. Speaking during the Asia-Pacific Economic Cooperation (APEC) summit, Obama said the move would “benefit everyone”.
It will allow citizens of each country to travel between the two countries for up to 10 years on a single visa, putting China on level footing with other major trade partners like Brazil and several European countries. Travelers and students can currently receive one-year visas. Students will also now be able to obtain five-year visas. The visa extensions will start on Wednesday.
The change is expected to be a boon for the US economy, creating up to 440,000 American jobs by 2021 because increased tourism and business spurred by visits from more than 7 million Chinese would generate nearly $85 billion in revenue, according to a White House estimate.
Last year 1.8 million Chinese travelers visited the US, contributing $21.1 billion to the economy and supporting more than 109,000 American jobs, according to a White House estimate.
The tourism industry accounted for 2.8 percent of US GDP and nearly 70 million international tourists spent $166 billion in the US in 2012, according to the US Commerce Department’s International Trade Administration.
“Where this will make the most impact is on the repeat traveler to the US from China,” said Evan Saunders, CEO of Attract China, a Boston and Beijing consultant that helps US businesses attract Chinese tourists.
He said many Chinese visitors who want to make multiple visits to the US won’t have to go through what can be a time-consuming process of renewing a visa every year.
“By 2018, Chinese tourists are expected to be the top overseas traveler to the US,” Saunders told China Daily.
What do US businesses have to do to take advantage of the projected influx of tourists?
“US businesses need to utilize the Internet and social media to engage the Chinese consumer,” said Saunders. “And they need to do it about six months before the Chinese tourist departs for the US.”
In 2012, Obama issued an executive order to ease the issuance of visas to visiting Chinese and to speed up the visa request process at China’s US consulates.
“This convinced hundreds of thousands of Chinese visitors to choose the US as a leisure and shopping destination and knowing that an average Chinese visitor to the US spends an average of $7,000 per trip, the impact on the US economy could be measured in additional billions,” said Pierre Gervois, CEO and publisher of China Elite Focus Magazines.
The visa extension will bring explosive growth to the tourism industry, said Ralph Zhu, marketing director of US International Trip, a California-based travel agency which expects 300,000 customers from China this year.
“The biggest growth may come from Chinese students studying in the US,” he said, “A student may spend three or four years in the United States. Under the new visa policy, their family and friends won’t worry about renewing their visas and therefore are more likely to visit them every year.”
The Chinese account for about 28 percent of the foreign students studying in the US according to the Institute of International Education’s Open Door report.
The basic visa processing fee will remain the same, according to the US State Department.
Obama arrived in Beijing earlier for a week-long trip to the region and the APEC summit. Later he is scheduled for a state visit with Xi.
“The fact that President Obama announced these changes with what he termed the strong approval of Chinese President Xi Jinping at a major multi-lateral event like the APEC summit is a positive step,” Kenneth Lieberthal, senior fellow in foreign policy at the Washington-based Brookings Institution,told China Daily.
However, Lieberthal said the agreement’s effect on the relationship between the two super powers will probably be muted.
“It’s a huge and complicated relationship. Still it does suggest that both sides want to accomplish some positive things. The new visa requirements will provide a boost to travel and it will increase interaction between the two countries. That is always a good thing,” he said.
Lu Huiquan in New York contributed to this report.
Article by PAUL WELITZKIN, China Daily USA, New York
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Easing moves start to thaw housing market

By Wu Yiyao in Shanghai and Li Wenfang in Guangzhou, China Daily (June 28, 2012 15:15)

Property markets across China are showing signs of a definite thaw, as pent-up demand is fanned by widespread speculation about further easing in the government’s monetary policy aimed at fuelling the economy, according to an influential snapshot of the sector.

In its latest report, China Index Academy, or CIA, said that 35 major cities reported year-on-year sales increases, with Lanzhou, capital of Gansu province, hitting a massive 560.25 percent year-on-year increase between June 17 and 24.

Headquartered in Beijing, CIA is one of the country’s largest property research institutions, providing extensive coverage of property markets through a network of offices in major cities.

The latest report showed that as many as 57,000 apartments in 54 major cities were sold between June 17 and 24 – a weekly record that exceeded 50,000 traded units since 2011, according to statistics provided by Centaline Property Agency Ltd.

The turnover in May of four leading Chinese real estate developers exceeded 10 billion yuan ($1.57 billion), according to their latest financial reports, suggesting a warming market after a year-long chill.

The four companies are Poly Real Estate Group Co Ltd, China Vanke Co Ltd, Evergrande Real Estate Group Ltd and China Overseas Holdings Ltd.

The top seller Poly’s sales in May grew 45 percent over a year earlier to hit 10.77 billion yuan, slightly higher than that of China Vanke. It was the first month in 2012 that Poly had revenues of more than 10 billion yuan.

The combined turnover in May for the top 15 of China’s property developers reached 268.6 billion yuan. For many companies, the turnover grew more than 20 percent last month.

A survey released by the People’s Bank of China on June 19 showed that among 20,000 respondents in 50 cities across the nation, 29.4 percent said they could afford homes at their current price level.

About 15 percent said they intended to buy a property in the coming three months, the highest rate since 2011 when the central government announced it was placing controls over housing prices while looking for ways to boost the economy.

About 20 percent of respondents said they expected that housing prices will increase, according to the People’s Bank survey.

Local governments across China have been trying to adjust house sales policies to help kick-start the economy, said Xue Jianxiong, analyst with China Real Estate Information Corp, or CRIC, a realty information provider.

Xue added that discounts introduced by developers in the past months have attracted buyers; the number of available apartments have decreased, while demand grew, with the average price rising as a result, in many of the popular projects.

As well as developers, local governments are also trying to increase sales.

The central government has approved more than 80 percent of new house purchase policies proposed in 33 cities since August 2011, Securities Times reported last month.

However, some policies aimed at loosening purchase controls proposed by some local governments, including those of Foshan, Wuhu, Shanghai, Chongqing and Chengdu, have been suspended or canceled after being found to conflict with the central government’s plans to curb price increases, the report said.

One example was a policy proposed last week in Henan province, which offered a 30 percent discount on interest rates for first-time homebuyers.

But two days after being offered, Henan authorities withdrew it, due to what it called conflicts with central government controls.

Despite central government efforts at curbing price increases, in many cities, including Beijing, Guangzhou and Shanghai, the prices of newly developed apartments have still been climbing since April, according to the latest sales records by local housing authorities.

The average price of some new properties, especially high-end ones, have seen up to 20 percent annual price increases in Shanghai, according to the latest report by CRIC.

Chen Qiguang, a 32-year-old potential buyer in the city, said: “I’ve visited more than 10 projects in the past two weeks, and have found average prices of new projects have been significantly higher than in early March, and second-hand properties are in short supply because owners do not want to sell at a low price.”

Average Shanghai housing prices for newly developed properties in the first 17 days of June hit 23,141 yuan ($3,640) per square meter, their highest level for 18 months.

Among the 56 new properties monitored by CRIC in Shanghai, 30 were reported as rising in price, while 26 were sold for a lower price, the CRIC report said.

“Some buyers are worried that house prices might further increase so they bought homes during the past two months, which helped push up prices since April,” said Zhang Yulin, an account manager at Xinyuan Property Agency in Shanghai.

Some popular housing projects have suspended discounts amid the bullish market, which also added to average prices, added Zhang.

Li Wenjiang, chief analyst of the Hong Kong-listed property agent Hopefluent Group Holdings, reported solid demand from buyers in Guangzhou, as a result of improving conditions being offered.

The market there remains especially good for buyers looking to upscale, with more large units set to be launched, lifting overall prices, said Li.

But he ruled out any fast growth in the market in the immediate future, given the economic conditions and controls by the government.

The traditionally dull months of June-August would also curb any rebound, added Li.

Contact the writers at and

Zheng Yangpeng contributed to this story


HK plays an irreplaceable role

HK plays an irreplaceable role
By Cheung Yan-Leung (June 28, 2012 15:32)

Hong Kong returned to China 15 years ago, and its role as an international financial hub has since then been elevated and enhanced.

The City of London Corporation has published the Global Financial Centres Index twice a year since 2007, and most of the time Hong Kong has ranked behind only New York and London.

The development of Hong Kong’s stock market remains robust. The number of companies listed on the Hong Kong Stock Exchange was 1,496 in 2011, up from just 658 in 1997, representing a total market capitalization of HK$17.5 trillion ($2.26 trillion), more than five times the HK$3.2 trillion of 1997. Meanwhile, the average daily turnover increased from HK$15.5 billion in 1997 to HK$69.7 billion in 2011.

Noticeably, Hong Kong’s stock market has become an important platform for mainland companies to raise funds. Mainland companies represented less than 20 percent of the market capitalization and less than 40 percent of the market turnover in 1997. However, by 2011, 640 of the listed companies were from the Chinese mainland, registering a market capitalization of $1.25 trillion, or 55 percent of the total, representing more than 60 percent of Hong Kong’s total equity market turnover. With large-sized State-owned enterprises being listed, Hong Kong ranked the world’s largest initial public offering market in 2011, claiming the top spot for the third consecutive year.

Hong Kong has also helped facilitate the reform of mainland companies. Specifically, mainland companies have to make systemic changes to meet the listing requirements of the Hong Kong Stock Exchange and certain disclosure requirements and legal regulations. As investors worldwide hold stakes in the companies after they are listed, the companies have to take into account stakeholders’ expectations and their business operations are subject to supervision. Through its strict requirements for governance structure and investment decision-making, the Hong Kong equity market has helped spur the transition of these mainland companies into modern corporations and sharpened their global competitiveness.

Hong Kong has also contributed to the mainland’s economic development over the past 15 years, and the mainland’s continued economic boom in the next few years will renew opportunities for Hong Kong. China promulgated its 12th Five-Year Plan (2011-15) last year and for the first time incorporated a chapter on the Hong Kong Special Administrative Region, which demonstrates its support for consolidating and enhancing Hong Kong’s role as an international financial center and support for Hong Kong’s development into an offshore yuan center and an international asset management center.

With the central government’s support, Hong Kong will continue to facilitate the reform of mainland companies and serve the national “going out” strategy.

This strategy aims at, on the one hand, encouraging Chinese companies to expand their business overseas, and on the other hand, internationalizing the yuan. The 12th Five-Year Plan (2011-15) emphasizes expediting the implementation of the strategy, encouraging and guiding mainland companies to invest overseas.

The outbound direct investment made by mainland companies is thus expected to grow rapidly. Hong Kong remains a major center for overseas direct investment flows, and more than 60 percent of the mainland’s overseas direct investment has gone to or through Hong Kong in recent years. The increasing ODI by mainland companies will generate great demand for finance and investment consultancy services, and Hong Kong is, and will remain, the strongest provider of such services.

Hong Kong has also played a key role in efforts to internationalize the yuan since it was established as an offshore yuan business center. The onset of the global financial crisis in 2008 and the ongoing European debt crisis have exposed the fundamental weaknesses of the current international monetary system and affected China’s foreign trade and foreign exchange reserves. China is now the world’s second largest economy and has good reasons to internationalize the yuan.

The current global economic landscape and China’s immature financial system will continue to prevent the yuan from becoming a fully convertible currency any time soon. So the development of offshore yuan centers remains the ideal choice to orderly and gradually expand the international use of the currency. Hong Kong is now taking the lead in this, and the rapid growth in yuan-denominated business worldwide will continue to benefit Hong Kong.

Despite the aforementioned opportunities, concerns have arisen that Hong Kong’s status as a global financial center is threatened by mainland cities especially Shanghai. However, their relationship is actually better defined as complementary and cooperative. China is a vast country with an economy large enough to accommodate two global financial centers.

The reality is, although Shanghai is the economic hub of the Chinese mainland with sound economic foundations and policy support, it still falls short of international standards in terms of institution building, especially legislative construction and financial liberalization. It is Hong Kong that serves as the bond connecting the Chinese mainland and the global economy, and its role cannot be replaced by Shanghai in the short term. Rather, its position as an international financial hub will be further consolidated and enhanced through its continued cooperation with mainland cities.

The author is dean of School of Business of the Hong Kong Baptist University.

US wants to work with China

By Tan Yingzi in Washington (June 28, 2012 15:39)

Strong relations key to peace in Asia-Pacific region: Official

As Washington gears up diplomatic efforts in Southeast Asia, it is equally important for the United States to maintain a sound relationship with China for the prosperity and peace of the Asia-Pacific region, a senior US official said on Wednesday.

The remarks, made by US Assistant Secretary of State for Asia and the Pacific Kurt Campbell, came a week before Secretary of State Hillary Clinton departs for the Association of Southeast Asian Nations Regional Forum and Post-Ministerial Conference in Phnom Penh, Cambodia.

Because of concerns among ASEAN members that the region may become an area of “dangerous strategic competition” between the US and China, Campbell said “one of the most important things for us at the forum is to make it clear, particularly to colleagues in ASEAN, that we are committed to a strong, stable and durable relationship with China”.

“It is our strong determination to make it clear that we want to work with China,” he said during a keynote speech at the second annual conference on maritime security in the South China Sea.

At the upcoming meeting in Cambodia, Clinton and her Chinese counterpart Yang Jiechi will roll out plans to work together on humanitarian disaster relief and wildlife protection, Campbell said.

On Thursday, Foreign Ministry spokesman Hong Lei told reporters that Beijing and Washington have made meaningful explorations in conducting trilateral cooperation in the Asia-Pacific region and achieved positive results.

“Beijing hopes to steadily boost both countries’ cooperation in the Asia-Pacific region on the principle of mutual respect, win-win and step-by-step, and jointly promote prosperity and stability with countries in the region,” Hong said.

Yuan Peng, an expert of American studies at the China Institutes of Contemporary International Relations, said Beijing and Washington have established mechanisms, including the China-US Strategic and Economic Dialogue, to brief each other on regional issues, and “Washington also hopes to avoid a confrontation with China on the South China Sea issue in a presidential election year”.

But the US has recently conducted a series of military drills in the Asia-Pacific region, and Yuan warned that the factors that encourage countries in the region to use the US to contain China “have not been eliminated”.

Beijing and Washington have faced challenges on the regional issues recently due to China’s growing influence and the US’ re-engagement diplomatic policy in Asia.

In July 2010, Clinton waded into the South China Sea territorial disputes by telling a regional security forum in Vietnam that a peaceful resolution of the disputes over the Nansha and the Xisha islands was an American national interest. Washington seeks to balance China-Southeast Asia relations through coordination and cooperation with both sides, said Fan Jishe, a US studies expert at the Chinese Academy of Social Sciences. “Maintaining regional stability and proper ties with the two sides is in the best interest of the US.”

On the recent development of the issue between China and the Philippines and Vietnam, Campbell said the US has insisted on not taking a position on the territorial dispute and supports the current diplomatic efforts from the related parties.

Bonnie Glaser, an Asia-Pacific security expert at Center for Strategic and International Studies, said the US does not view the relations in the region in zero-sum terms, and it is not seeking to force ASEAN members to choose between the world’s two largest economies.

“Although the US and other media often pin blame on China, I think other claimants of South China Sea also sometimes behave in provocative or confrontational ways that has generated concern from the US government,” she said at the annual conference.

Zhang Yunbi and Zhao Shengnan in Beijing contributed to this story.