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ABOUT August 2008
This page contains all entries posted to PN China Blog - English in August 2008. They are listed from oldest to newest.

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August 2008 Archives
August 6, 2008

12 reasons not to comment

Thanks to you, my dear readers, the PN China Blog English version has been the most-trafficked session on the PN China English site for the past six months.

However, while so many of you generously spend time browsing entries, only a small number of you have taken the extra step to leave comments. So far, I've gotten 53 comments for the 111 English-language entries and 96 comments for the 122 Chinese-language entries. That's not bad at all. And I don't read too much into the sheer number of comments.

Still, I tried to place myself in your shoes and came up with 12 possibilities for your silence. My responses to the reasons are in parentheses.
  • 1. "I'm too busy to write comments." (Understood.)

  • 2. "If other people don't comment, why should I?" (Because what you have to say is important!)
  • 3. "I don't want to reveal my name, e-mail or URL." (Don't worry. You can leave those fields blank!)
  • 4. "I don't want to draw attention to myself, especially since the plastics business community is relatively small and people can probably recognize me from what I say." (Oh well, people know you anyway...)
  • 5. "I don't like how the comments don't show up immediately and instead need to be approved by the site owner." (I delete five spam comments a day. I really don't think you'd appreciate seeing phishing-fraud links on our site.)
  • 6. "Although interested, I'm not particularly knowledgeable on the subjects." (You can raise questions then.)

  • 7. "The topics are interesting, but the way facts and opinions are presented doesn't spark discussion." (I'll definitely work on that and welcome more specific advice and suggestions.)
  • 8. "It takes more than a couple lines to weigh in on some complicated matters." (We set no limit in length of comments.)

  • 9. "I have strong, different opinions, but I don't feel like sharing." (It feels good to share.)

  • 10. "The topics are too broad, not focused on plastics." (I thought general business news and cultural background would benefit our readers as well, no?)

  • 11. "The postings are more news-oriented than opinion-oriented." (There should be plenty of thought-provoking issues reported as news, such as the Chinese bag ban.)

  • 12. "I'm not sure why I don't like to post comments." (Keep me posted if you figure out why later.)
  • Which of these reasons, if any, apply to you? Let me know. If there's anything else I didn't think of, also let me know. You can either post a comment here or e-mail me at nyingsun@crain.com.

    Keep in mind, a trade journal's mission is to serve the business community. You are the real experts, not me, in the field. My job is to share information, inspire discussions and make your voices heard.

    Cheers.

    August 5, 2008

    iPhone's plastic casing

    Perhaps it's too early to draw a conclusion, but the popular Apple iPhone 3G may not be doing much to help change the "low-quality" image of plastic.

    Owners are reporting tiny cracks on the plastic shell of the iPhone. In a discussion thread on the official Apple discussion forum, various users have reported such issues, especially with white units.

    Another Mac-user online community is having a similar discussion, with a few user-generated photos just on the first page.

    Although the iPhone 3G is not yet officially available in mainland China, fans are closely watching feedback from users in other regions. A popular Chinese information technology site published a collection of photos and commented that the quality of the plastic casing is cheaper than the metal casing used on first-generation iPhones.

    One reader left a message, asking: "Is this a production problem in Apple's Chinese factories or Apple's unwise selection of materials?"

    Some markets in Shanghai are selling smuggled iPhones with price tags of 8,800 yuan (US$1,289) for the 8G model and 9,700 yuan (US$1,421) for the 16G model, according to local newspaper Oriental Morning. Vendors claim that the pricing is reasonable, because the handsets are unlocked and without a contract. However, the 16-G model without a contract will cost just US$699 in the U.S.

    August 1, 2008

    The China vs. India game

    When I was writing my July 31 post on China becoming the world's largest online community, I thought about India. In fact, the 4 percent penetration rate of the Internet does sound low for a country known for IT outsourcing, and, more recently, design and engineering.

    I didn't include a comparison of the two countries in my posting, mainly because I wanted to keep the piece short and sweet.

    But Business Week writer Frederik Balfour did in the "Eyes on Asia" blog, highlighting a pair of data sets: China's 19 percent Internet penetration vs. India's 4 percent, and China's 85 percent broadband percentage vs. India's 4 percent.

    He received some harsh and outspoken comments, which criticized the writer's lack of understanding of the matter and framing up or exaggerating the China-India rivalry.

    BW does like the China vs. India theme. It certainly grabs attention and invites bickering. A case in point was a July 22 BW article, "Why India will beat China". The story stirred up more than 500 comments -- some are intense and angry -- in a week.

    If I can weigh in a little, China and India are on the top of the target list of Western companies' investment locations. So it makes perfect sense to compare the pros and cons.

    But it can get writers into hot water to judge developing countries with their own set of values and underlying assumptions and then hope everyone else agrees. What is or is not desirable? Which goals are and are not priorities? These are all subjective value judgments.

    And, local knowledge--understanding how a particular social system works--is vital. For instance, Balfour was surprised by how firewall -- used by the government to block Web sites, Web pages and even certain key word search that the government deems inappropriate -- doesn't discourage the growth of Chinese Internet users. I can help solve his puzzle: First, most Chinese people use the Internet for reasons other than political; second, the Internet has enabled Chinese people to talk more openly than ever and helped form an emerging public sphere in the cyberspace. Online firewalls can be frustrating, but not as almighty as in the off-line world. In other words, people who are used to tight government control in the day-to-day life aren't deterred by the presence of online police from using the Internet. It's that simple.

    August 29, 2008

    Recycling at the Olympics

    The opening ceremony of the Beijing Olympics was a spectacle, but it also generated 107.9 metric tons of waste, the Beijing government said. Thanks to more than 3,000 workers and 300 vehicles involved in the collection and initial processing, more than 80 percent of the waste was recycled.

    A total of 1,122 recyclable waste bins were placed in the Olympic Green in Beijing, in addition to 1,422 non-recyclable waste bins. Workers used electric cars to transfer waste from bins to the four "Waste Compressing Points" around the Green. The points were equipped with compressing containers that measure 17 cubic meters and each fit nearly 10,000 bottles.

    The next stop was the Xiaowuji Waste Management Station, where China's only NIR automatic sorting line processed the waste. Baled bottles were then delivered to recycling plants.

    Manual sorting was used to process waste collected from 11 stadiums located in the Haidian, Fengtai and Shijing Shan districts. It is reported that the audience of the U.S.-China men's basketball game left 26,614 plastic bottles and 223 aluminum cans.

    Previous reports suggested that Coca-Cola and Beijing Incom Resources Recovery Co. were going to handle the recycling part of all PET bottles collected from Olympics stadiums.

    [Sources: China Environment News, Fazhi Evening, Beijing Evening, Coca-Cola]

    August 22, 2008

    Who invented plastic bags?

    In a family chat about China's bag ban, my parents all of the sudden asked me: "Who invented plastic bags? Did he/she have any idea that plastic bags would turn out to be such a controversy?" I guess they assume that I must be a plastics expert since I work for Plastics News. Too bad, I didn't have a clue.

    I found some relevant info from the Internet but can't verify the validity. I asked around in the office and still don't have an affirmative answer.

    I am going to call up some real experts to find out more. In the mean time, can anybody shed some light on this interesting question?

    August 20, 2008

    Mitsui Chemicals adds compounding capacity worldwide

    Tokyo-based Mitsui Chemicals Inc. told the Nikken Business Daily that the company is expanding the compounding capacity of its subsidiary in Zhongshan, Guangdong province, in China.

    The company plans to invest 1 billion yen on compounding equipment and raise the capacity of polypropylene compounds in Zhongshan by 25 percent, bringing the site capacity to 50,000 metric tons annually.

    The compounds are mainly used for automotive bumpers and interior trim.

    The expansion will be completed by summer 2009. Mitsui Chemicals announced in April its plans to increase the compounding capacity in Zhongshan to 42,000 metric tons by the end of 2009. It seems like the plan has been revised, with a larger investment and an earlier deadline set for China.

    In the same announcement, the company mentioned a series of PP compounding capacity increases around the globe. By the end of 2009, it will add:
  • 6,000 metric tons of capacity in Sydney, Ohio;
  • 17,000 metric tons in Nashville, Tennessee;
  • 5,000 metric tons in Aguascalientes, Mexico;
  • 27,000 metric tons in Bangkok, Thailand;
  • and 15,000 metric tons in New Delhi, India.

    The Nikken report also said that Mitsui is investigating the possibility of adding a plant in Europe. The company currently has manufacturing sites in Stirlingshire, Scotland, and Bad Sobernheim, Germany.

  • August 19, 2008

    Who molded the 80,000 seats in Bird's Nest?

    The answer is Nanjing Jinling Plastic & Petrochemical Co. Ltd., located in Nanjing, the capital city of Eastern China's Jiangsu province.

    Nanjing Jinling was founded in 1955, became a subsidiary of Sinopec, China's largest petrochemical company, in 1982 and was merged into Jiangsu GPRO Group Co. Ltd. in 2004. It appears that Nanjing Jinling still has close ties with Sinopec -- the official sponsor of the seats.

    The seats were blow molded out of polypropylene and feature two colors -- "China Red" and "Great Wall Grey," Sinopec said in a release. Engineers at Nanjing Jinling said the color names were coined by "national leaders in Beijing" with no detailed description, and it took the company months to develop the specific shades, hues and tints.

    The PP material is highly flame-retardant with an SDR below 50 and is UV-resistant -- the color will not fade for at least three years. What will happen when the color starts to fade? The manufacturer noted that the seats can be easily recycled.

    Nanjing Jinling recently revealed the timeline of the project to a regional newspaper, Jiangsu Fazhi:

  • December 2005: Nanjing Jinling received product requirements from the Beijing Organizing Committee for the Games of the XXIX Olympiad (BOCGO) and started the product development process, with an emphasis on ergonomic design.

  • August 2007: The BOCGO approved the design and prototype.

  • October 1, 2007: The company completed the molding of 80,000 seats in less than two months and started installing.

  • January 26, 2008: All 80,000 seats were installed, and the project was completed.
    Photo courtesy of Nanjing Jinling

  • August 18, 2008

    Let China have its moment

    I've been real busy these days. Besides watching the Olympic Games on TV for hours and hours, I've had a good taste of the Western world's criticism of China. From radio shows to the Internet, China is the biggest controversy.

    The Beijing Olympics is, without a doubt, an extremely emotional moment for China. For Americans, it's not easy to sympathize with a country that's geographically and ideologically half a globe away. But, take a moment to read what an American consultant living in Shanghai had to say. Kent Kedl, the author and general manager of Technomic Asia, watched the opening ceremony at two bars -- one local, the other expat-oriented. Find the original article in the China Business Blog.
    During the singing of the Chinese national anthem at the opening ceremonies, many people had tears in their eyes, as if they had just won a gold medal after many long years of training. Well, in a sense, they have. Even if much of post-Liberation history has been erased from the books here, the shame of the Opium wars and Japanese colonial occupation is learned by wrote. So, to see 80 world leaders gathered with 91,000 others in a stadium to be watched by -- probably -- nearly a billion more on television, all to recount 5,000 years of Chinese history and contribution to world culture and commerce ... well, that should be emotional.

    So I say, let China have its moment. Are there still problems? Of course there are. But I believe that the way out of these problems is through the pride and (yes) abject nationalism of the Chinese people themselves. Pride in building a nation into the fourth largest economy in the world over the past 20 years is child's play compared to the challenges of building one that represents justice for every one of its citizens. Given that, over the past 200 years, we Americans have not been able to do this ourselves -- and, in fact, have slipped drastically backwards in recent years -- should give us all pause.

    But give it time and the Chinese people will stop comparing themselves to where they have come from and will start measuring themselves against where they could be. Then -- and only then -- will change happen in China.

    Twenty years ago when I was teaching in a Teacher's Institute in rural China, where the average wage was barely $40 a year, I never thought I would see this day. So I am going to gather with my friends and neighbors at the local pub and will lend my voice to the shouts of "Zhong Guo Jia You!!" ("Go China!!"). I, too, get misty when I see a Chinese gold medal winner on the stands and hear their national anthem. I am not Chinese and I will never claim to know what it is like to be Chinese, but I am honored to be here among them as they are discovering just what that is.
    It makes me sad that the Chinese people are unaware of and unprepared for the criticism, and, undeniably, some hostility from outside the country. Three in four Chinese believe the world loves China, partly because the government blocks foreign media [details in a Washington Post article].

    It's time for China to face the music, take it gracefully and strive to improve itself -- all aspects of the society. In the end, action speaks louder than rhetoric.

    August 15, 2008

    The 'China overtaking U.S.' news

    Not that long ago, in the 1950s, Mao initiated a nationwide campaign called the "Great Leap Forward" in China, and the slogan he coined -- "Catch up with and leapfrog and the U.K. and the U.S," which I've paraphrased -- turned the country into a dangerous mess of chaotic passion, deception and fraud. The campaign failed, of course, with a very brutal ending that was coupled with natural disasters, which lead to famine and cost tens of millions of lives from 1959-1961.

    Decades have passed. But time hasn't faded the Chinese people's memory of that mad era. Therefore, when I saw that China is set to overtake the U.S. (see the original report from the Financial Times) in terms of manufacturing output, the first thing that came to my mind was, how will the Chinese people take it?

    I checked Chinese media and online forums. Yes, there are expressions of pride and excitement. But an op-ed from China's government-backed English-language newspaper China Daily went beyond that. The article highlighted the challenges China faces, underscored the fact that China is still behind even the world's average level of industrialization (otherwise, it'd account for about one-fifth of global manufacturing given the size of its population), and stressed the new goal of sustainability instead of blind expansion of low-end manufacturing.

    Those are fair, objective and constructive points. No one can argue about how much and how urgent sustainability is needed in China for the overall good of the world. I'm glad that China is examining its success in the right context with modesty and vision. That attitude alone is a huge step up.

    August 14, 2008

    China's 1st NIR sorting line

    If you're wondering how the Olympics have changed China in a positive way, well, here is an example. Beijing is now running the nation's first near-infrared photo-detecting line to sort trash collected from the Olympic venues. After the games, this line will be used to process residential waste in the municipality.

    As the Beijing Youth Daily described, the line sorts plastic bottles, plastic bags, PVC pipes, steel and paper perfectly, and it automatically bales every category of material.

    The investor, Beijing Public Sanitation Group, spent 13 million yuan on the fully automatic line with daily processing capacity of 150 metric tons. "That's about how much 80 workers can process," the company said.

    But, bottom line, what does this mean? I started doing some math: assuming the line will run 24-7, and each worker costs the company 100 yuan per 8-hour working day, the line will save 8.7 million yuan on labor cost a year. Even taking into account energy and maintenance costs, the investment should be easily paid off in two years.

    Yes, China's labor is still much cheaper than the developed world. But wages are going up, and plastic recycling plants of visions are already applying more technologies than ever to improve efficiency. But I'm curious. How much of a cost advantage will an automated Chinese recycling factory have over its American counterpart? In other words, how will the trend of automation in the Chinese recycling industry revise the global flow of plastic scrap and impact global resin pricing?

    What do you think?

    August 11, 2008

    1 quarter in China = 1 year in U.S.?

    I've been to the annual International Housewares Show in Chicago for two years in a row. Its organizer, the International Housewares Association of Rosemont, Illinois, just sent me an e-mail, touting some interesting materials on its Web site.

    The one that interested me was "Manufacturing in Asia: Current reality and emerging trends," an audio-enhanced powerpoint presentation by Michael L. Hetzel, vice president/Americas of Pro QC International.

    In the speech, Hetzel tried to bust the myth that the U.S. manufacturing output is dropping. The reality is that it's growing. I'm not sure if that applies to the plastics industry though.

    Hetzel downplayed China's role as the world's factory, underscoring that China's industrial output is well below the U.S. output. However, according to today's Financial Times, China is set to overtake the US in 2009 as the world's largest producer of manufactured goods, four years earlier than expected, as a result of the rapidly weakening US economy. Global Insight, a U.S. economics consultancy, conducted the forecast.

    Hetzel also questioned the belief that China is "the cause" of America's trade deficit, as the U.S. has a deficit with 13 of its top 15 trading partners.

    Hetzel also stressed that the U.S. manufacturing output is going up in spite of the decline in employment.

    But wait, he isn't promoting China as a sourcing destination. He made a long list of the challenges China faces and advised businesses to consider different sourcing options around the world.

    The last slide concluded: "The U.S. doesn't import too much ... We export too little."

    In addition, the Web site also featured a whitepaper on Doing Business with China, which has only one page of executive summary, and another 15-page whitepaper called "Manufacturing in Vietnam."

    For some reason, the Vietnam article failed to recognize the sky-high inflation and currency crisis in Vietnam. The addendums have some useful information about logistics, including inland transportation costs. But the quotes were from January 2008, so don't be surprised if it's changed by now.

    Some American expats in Shanghai once told me that "Things change so fast in China, it feels like three months in China equals a whole year in the U.S.," pointing out the fast pace of change in China's economy as well as other aspects of society. Very true. Therefore, be sure to take any China/Asia literature, be it business reports, books, or say, my old blog postings, with a grain of salt and do some research for the latest development.

    August 8, 2008

    Bag ban's unofficial casualties

    A news report in the Guangzhou Daily said that at least 100 plastic bag factories in Guangzhou have shut down since the June 1 enforcement of China's national restrictive policies on plastic bags, quoting an unnamed "industry insider."

    That's the power of 1.3 billion consumers. No data is available on the reduced use of plastic shopping bags on a national level. But media and trade association have reported "significant declines" in individual stores and regions.

    Guangzhou authorities have also confiscated more than 20,000 bags in the past two months. But an official also acknowledged that ultrathin plastic bags are still being used in farmers markets. Guangzhou residents in particular, prefer to buy live fish and seafood as well as fresh meats.