It's the economy, stupid - Arthur Kroeber

Arthur Kroeber

Journalists and political analysts look at the political bubbles emerging from the ongoing meeting of the Communist party in Beijing, it makes more sense to look at the underlying economic current, says renowned economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know®. At NPR he looks back at some difficult years.

NPR:

China's unstable economy has its beginnings not in China but on Wall Street in 2008, when Lehman Brothers filed for bankruptcy, setting off the worst economic crisis in living memory. 

"In the year after the Lehman Brothers bankruptcy, the value of Chinese exports fell by about 20 percent, which is a very big deal," says Arthur Kroeber, a founding partner of Gavekal Dragonomics and author of China's Economy: What Everyone Needs to Know. In 2008, exports were the beating heart of China's economy, employing hundreds of millions of migrant workers who were working their way up China's social ladder to make up the world's largest consumer class. 

"The estimates at the time were that somewhere in the neighborhood of 20 million workers in export-related industries along the coasts lost their jobs and had to return home," says Kroeber. "It was a pretty major shock to China." 

How would a country accustomed to double-digit economic growth cope with tens of millions of workers suddenly out of work? China's leaders didn't wait to find out. Within weeks, they passed a historic stimulus package, injecting nearly $600 billion into the economy, an amount worth 15 percent of China's entire economy. 

"It was by far the largest fiscal stimulus, in absolute terms or relative to GDP, of any economy in the world at that time," says Kroeber. 

It worked a little too well. 

Millions of Chinese went back to work on infrastructure projects like the world's most extensive high-speed rail network, highways and subway systems. By 2010, China was back into double-digit growth territory again. 

But all this new money flowing through local governments exposed deep-seated vulnerabilities in China's political system — namely corruption, says Kroeber. 

"Corruption throughout the economy, it kind of got out of control," he says. "It was pretty bad before the financial crisis. The stimulus, I think, just poured gasoline on the fire of corruption."

More at NPR.

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The upcoming cold war in the Internet - William Bao Bean

William Bao Bean

Key players in the US and China have profoundly different ways to expand, says William Bao Bean, managing director of Chinaccelerator to the Harbinger China. Those major player changed the playing field profoundly, also for startups.

The Harbinger China.

William: In the U.S., companies like Facebook have lagged behind China for a year-and-a-half to two years now. And it's taken about a year-and-a-half for Facebook to develop many of the features that are currently coming out on [Facebook] Messenger and WhatsApp around payment and commerce.

So here's the difference: in China you can go on any social network and pretty much anything that you see you can click and buy, whereas on Facebook, on [Facebook] Messenger, on WhatsApp, on any of these platforms, they have a different business model, or actually, they do not have a business model. They are not making any money. So Facebook played the long game and now they are making lots of money. But it's all advertising based and if you think about basic economics, advertising drives behavior. And usually people want to drive purchasing behavior so advertising revenue is actually a subset of the actual commerce revenues. Advertising drives game revenue; advertising drives commerce revenue. 

Facebook makes money on advertising while in Asia, social media platforms like WeChat and Weibo make money on commerce such that they get a cut of the actual purchase. So if you control the payment platform as well as the user, it's much more powerful than just controlling the advertising. You can potentially have an order of magnitude of greater revenue. So we will see an interesting battle played out in other countries like India, where Facebook and WhatsApp are strong and where Chinese players have backed local commerce companies and local payment companies. So it'll be the Indians backed by the Chinese against U.S. heavyweights like Facebook and Amazon. And that'll be interesting to see how things play out, especially in comparison to China, because the Chinese retail industry is under a huge amount of pressure since people don't carry wallets or buy offline anymore. 

Adam: Given that Facebook is entering new markets like India, and with the other Chinese-backed providers which have payments attached to the virtual and social experiences, how do you think Facebook might localize their products or customize in those particular markets in terms of payments? 

William: Facebook does not localize. They have an “one size fits all” strategy. Facebook in the U.S. is the same as Facebook in India. They can add features, and they are adding payment methods. But the bottom line is that a product designed for one market does not always work in another market. So far Facebook has been very successful in Southeast Asia and same with WhatsApp, but they are somewhat bounded by the fact that they do not localize. So what you'll see play out is global companies like Facebook and Google increasingly going up against local players backed by Chinese companies like Alibaba and Tencent.

I think it is like the next World War. It's not going to be fought with the tanks and bullets and guns, but between global companies. Instead of having 80 percent of the money made by 20 percent of the companies, it's 99 percent of the money being made by 1 percent of the company.

More at the Harbinger China.

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Xi Jinping's China dream: a more assertive role - Ian Johnson

Ian Johnson

China's leadership is gathering this week in Beijing to prepare another five-year plan, and affirm president Xi Jinping for another five-year term. Journalist Ian Johnson looks for the New York Times at the new role China is playing in the world. "His China could become a model for digitally driven authoritarianism around the world."

Ian Johnson:

For foreigners, this means getting used to a China that is stronger and more assertive — but possibly more brittle — than in the past. If Mr. Xi is successful, his China could become a model for digitally driven authoritarianism around the world, while failure could force a reconsideration of the wisdom of trying to force-march a country to modernity. 

China’s new role is hard to miss in foreign affairs. For decades, Washington has been urging China to get more involved in the world. Usually this meant asking China to help solve international crises — to become a “stakeholder,” in foreign policy jargon. But to many people’s surprise, after years of playing a mostly passive role in world affairs, China has taken a forceful approach.

Beijing has moved aggressively to enforce historically dubious claims to international waters and islands far from its shores, building reefs into islands and making the bizarre assertion that the economic zones around them are Chinese waters — arguments contrary to any independent interpretation of international law. 

China has also begun pulling small countries on its periphery into its orbit through a lavish infrastructure plan called the “One Belt, One Road” initiative, in the process propping up regimes that are sliding away from democracy in Thailand, Myanmar and Cambodia. 

These ambitious policies to dominate the region are paralleled by tough measures at home. For five years, Mr. Xi has led a fierce campaign against corruption, which arguably was the biggest threat to the party’s long-term ability to rule. But he’s also leveraged this crackdown to sideline political rivals, admitting as much last year when he said that high-ranking officials arrested for corruption had been engaging in “political conspiracies.”

Much more in the New York Times.

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One Belt, One Road: too big to succeed? - Sara Hsu

Sara Hsu

China's close to one trillion US dollar investment program One Belt, One Road (OBOR) is facing serious pitfalls that could stop it from succeeding, writes financial analyst Sara Hsu in the Huffington Post. Insufficient due diligence is just one of a range of potential barriers, she writes.

Sara Hsu:

The question, though, is if it will succeed. There appears to be insufficient due diligence in some cases, which carries political and financial risks. For example, work on the Colombo port project in Sri Lanka and a high-speed rail plan in Indonesia stalled due to local opposition. In other areas, like Gwadar in Pakistan, security is a major concern.

Projects funded by the Asian Infrastructure Investment Bank are more likely to be carefully weighed in terms of risk. By contrast, projects financed by the China Development Bank or the Export and Import Bank of China may undergo standard examination but, as part of an array of projects on the table, may be short-changed in full analysis and oversight. AIIB has provided $1.73 billion for nine Belt and Road projects. The overall figure for projects in the planning or implementation stages is $900 billion. 

The vast majority of funding for Belt and Road projects comes from the Export and Import Bank of China, China Development Bank and China’s commercial banks. China’s policy banks are overbooked: in 2015 alone, the China Development Bank said it had reserved $890 billion for over 900 projects. What is more, the Export-Import Bank of China stated at the beginning of 2016 that it had funded over 1,000 projects. How can these large development banks plan and oversee that many projects?

More in the Huffington Post.

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How WeChat started to promote WeBank - Matthew Brennan

Matthew Brennan

E-commerce expert Matthew Brennan discovered how WeChat silently started to promote Tencent's WeBank, a potentially major move in pushing internet banking ahead of the traditional banks in China, he writes on his website China Channel. The old banks will have to run for their money.

Matthew Brennan:

A few days ago a small but potentially important new change on WeChat was quietly released without any official announcement (to date). There’s now finally a way to get around WeChat Pay’s yearly balance transaction limit and it seems that this is now WeChat’s first serious move to promote WeBank, which makes it a big deal... 

WeChat Pay currently has a yearly user balance transaction limit of 200,000 RMB (roughly 30,000 USD). For power WeChat Pay users and small businesses alike, this limit has caused some pain. Yet in the past few days, it seems a small but potentially important new change on WeChat was released without any fanfare.. 

This new move is just one of the recent ways that WeChat Pay is trying to make up ground with Alipay in terms of providing mobile financial products and services by leveraging WeBank. Another big one is WeChat’s Lingqiantong 零钱通 feature which allows users to earn daily interest on the balance left in their WeChat wallet, a very similar feature to Alipay’s massively successful Yu’e bao 余额宝.... 

Bye, bye traditional banks. We don’t need you anymore. WeChat and Alipay control the relationship with the customer. They find smart ways to incentivize users to open up accounts at their own internet banks and link those up instead.

More at the China Channel.

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Moving to a cash- and cardless society - Andy Mok

Andy Mok

China has all but abolished cash and bank cards, and the rest of the world might be following fast. CBS talks to economist Andy Mok. China had no good working banking system, and moved fast to mobile payment, but the rest of the world might follow soon.

Andy Mok is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

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China's rich control US$2.6 trillion - Rupert Hoogewerf

Rupert Hoogewerf

China's growth might have reduced, and investing abroad more difficult, but China's annual Hurun rich list has been growing faster than ever, says its chief researcher and founder Rupert Hoogewerf to the South China Morning Post. China's rich now control US$2.6 trillion, he adds.

The South China Morning Post:

There was also substantial change at the top of the rich list. 

Xu Jiayin, chairman of real estate developer Evergrande Group, has emerged as China’s richest man with assets worth US$43 billion. 

Last year’s leader, Wang Jianlin, dropped to fifth after declines in the share price of his embattled Wanda Group saw his family’s net worth slump 28 per cent to US$23 billion. 

“Overall, the Hurun Rich List has grown faster than any year since 2007, with the possible exception of 2015,” said Rupert Hoogewerf, Hurun Report chairman and chief researcher. 

Evergrande is China’s largest property group by sales, and since the start of this year, the price of its shares in Hong Kong has risen by 465 per cent. 

Pony Ma Huateng, founder and chief executive of Tencent took the No 2 spot on the rich list with a net worth of US$37 billion, overtaking Alibaba chief executive Jack Ma at US$30 billion, who ranked third. 

Fourth on the list, and also China’s richest woman, Yang Huiyan, vice-chairman and the largest shareholder of real estate developer Country Garden, saw her wealth triple to US$24 billion. 

Aside from real estate, technology names continued to dominate the wealth rankings with Baidu’s Robin Li, and NetEase’s Ding Lei both making the top 10. 

“China’s entrepreneurs have come a long way. Back in 1999, when I put out the first list, I managed to rank 50 people. Today we have almost that number just from Alibaba,” said Hoogewerf. 

Of the 2,130 individuals with assets above US$300 million, 43 came from Alibaba and its affiliate Ant Financial.

More in the South China Morning Post.

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Xu Jiayin of Evergrande, China's latest richest man - Rupert Hoogewerf

Rupert Hoogewerf

The annual Hurun Rich list has identified Xu Jiayin, chairman of the China Evergrande Group as China's richest man, beating more familiar names like Alibaba's Jack Ma and Wang Jianlin of the Wanda Group. Hurun's chairman Rupert Hoogewerf reports more drastic changes, he tells Reuters.

Reuters:

Xu’s reported $43 billion wealth - a gain of around $30 billion against last year - comes on the back of a surge in Evergrande’s shares, up over 450 percent so far this year amid plans to cut debt and focus on profit over scale. 

The Hurun Report, established in 1999, is the leading China-based organization ranking the wealth of the country’s rich and famous, and its list gives a temperature check on the winners and losers in China. 

Growth in China stabilized this year, but while the world’s second largest economy averted a hard landing, some major corporations have buckled under the weight of their debt or been sanctioned by authorities over risky investments overseas. 

Wanda’s Wang - who took top spot for the last two years - dropped to fifth in the list after Wanda sold off much of the firm’s hotel and theme park assets to rivals in July, after coming under regulatory scrutiny over its high leverage. 

Close behind Evergrande’s Xu were China’s top tech titans - Alibaba’s Jack Ma and Tencent Holdings Ltd’s Pony Ma, who has seen his firm’s value rise on the popularity of its WeChat messaging app and its popular online games. 

The list also underlined those who have fallen from grace in corporate China.

Jia Yueting, founder of sprawling conglomerate LeEco that once looked to rival both Tesla Inc and Netflix, dropped to 1,978th place from 31st last year. 

Yang Kai, chairman of embattled Huishan Dairy - 66th last year - dropped off the list entirely as his firm fights off creditors amid billions of dollars of unpaid debt. 

On the up was Wuxi Pharma Tech’s Li Ge and his wife, propelled by China’s push towards drug innovation, Zhang Lei of fast-growing online news portal Toutiao and Li Shufu of carmaker Geely Automobile Holdings Ltd. 

“It has been a good year for manufacturing, cars, education, TMT and healthcare,” Hurun founder Rupert Hoogewerf said. 

While many of those on the 2,000-strong list were members of the National People’s Congress and Chinese People’s Political Consultative Conference, only a few were delegates at the upcoming five-yearly Party Congress that begins next week.

More at Reuters.

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Travel trends for Chinese consumers - Ben Cavender

Ben Cavender

The autumn Golden Week is over and business analyst Ben Cavender looks at the trends among high-spending Chinese travellers. Unique places, convenience and safety top the agenda's of Chinese tourists, he tells in CNBC.

CNBC:

Tailor-made travel services are fast becoming customary among wealthy travelers looking to escape cookie-cutter vacation packages. According to Ctrip, factors that more Chinese tourists are seeking out from their holidays include "avoiding big crowds," "no shopping" and private travel guides. 

When travelers visit places others haven't, they can derive "social cachet," and that's become a trend among the middle class, according to Ben Cavender, a principal at consultancy China Market Research Group. 

"Increasingly, we are seeing well-heeled Chinese travel to hard-to-reach destinations for the bragging rights and WeChat pictures [to] show they've been somewhere exotic," he said... 

Convenience, however, has also been a driver for the increase in domestic travel. As the growth in international flight options has not kept up with growth in demand, purchasing tickets without advanced planning can prove difficult and lead to more interest in alternatives that are less of a hassle, Cavender said. 

Safety concerns also likely played a part in influencing travel decisions among mainland tourists, Cavender added, alluding to incidents that have taken place in Europe and the U.S. in recent quarters.

More in CNBC.

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How change damaged the position of Chinese women - Zhang Lijia

Zhang Lijia

China's shift from a planned to a market has lifted millions out of poverty, but for many women the deal has been a bad one, says Beijing-based journalist Zhang Lijia, author of Lotus: A Novel on prostitution in China at Sea Globe.

Sea Globe:

Zhang pointed to figures released by the UN in 2015 that reveal a growing income gap between men and women in post-Mao China. The report found that between 1990 and 2010, average urban income for women as a percentage of that of men had dropped from 77.5% to 67.3%. For women outside the major cities, the figure was as low as 56%. 

“When China shifted from the planned economy to the market economy, women shouldered too much of the burden and cost,” Zhang said. “When the state-owned enterprises laid off workers, women were always the first to be let off. And it is much harder for middle-aged women to find re-employment. 

Zhang also pointed to a resurgence in pre-Maoist values that ascribed strict limits to the role – and value – of women in Chinese society. 

“I think some of the old attitudes towards women, which place women as inferior to men, resurfaced,” she said. “At workplaces, Mao-style gender equality has been replaced by open sexism… Sometimes they refuse to hire women of a child-bearing age or sack them after they become pregnant.”

More at Sea Globe.

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Conservative resistance against liberalization of the yuan - Victor Shih

Victor Shih

Retiring central banker Zhou Xiaochuan called this week for the liberalization of China's currency, the Yuan. But conservative forces might find this step from the People's Bank of China (PBOC) a step too far, says financial expert Victor Shih to Bloomberg.

Bloomberg:

While it’s widely expected that Zhou will retire, there are no guarantees as China’s political appointments are often unpredictable. The PBOC chief bucked expectations he would leave back when he was 65. Instead he was promoted, taking on the title of vice chairman of the Chinese People’s Political Consultative Conference, where the retirement age typically is 70. Zhou turns 70 in January. 

“It seems there is a concerted push from within the PBOC to liberalize the capital account and exchange rate a bit while the yuan is relatively strong,” said Victor Shih, a professor at the University of California in San Diego who studies China’s politics and finance. “The conservative views of the higher leadership may stand in the way of significant progress.”

More in Bloomberg.

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China: struggling for its position in the world - Tom Doctoroff

Tom Doctoroff

China gains economic and financial power, but is still struggling to find its place in the world, writes China veteran Tom Doctoroff in the Huffington Post."So China’s road to becoming a “soft” superpower will be long and rocky indeed," he says.

Tom Doctoroff:

Unlike Japan, a cocooned island, China is not apart from the world. Indeed, the country fancies itself the center of the universe, a cultural supernova that sucks in anything in its path. China - as much as civilization as a nation-state - has endured for thousands of years, a feat attributed to natural order. The “idea” of China is, in local people’s eyes, absolute truth. China analyzes, dissects and atomizes the political systems of other nations. It studies Western competitive advantages and applies them to local circumstances. But it is also a country in search of its own Copernican revolution. It remains unable to weave itself through the warp and weft of other societies. 

For example: Other than Huawei, a business-to-business telecommunications company, no Chinese corporation has achieved significant scale in any developed market - Haier’s fifteen percent share of cheap microwaves and mini fridges in the US does not count - due to, among other factors, the inability to balance marketing and sales functions; 

International cuisine is a hit in public settings where middle class Chinese bend over backwards to project an image of cosmopolitan erudition. However, even sophisticated Shanghainese rarely eat foreign foods at home. According to Treasury Wine Estates, only 5% of booming red wine consumption occurs at home; 

Chinese expatriates, particularly men, do not assimilate well. They often return home with a simplistic view that the West “looks down on” them. But reality is subtler. At business schools and in offices, clusters of Chinese retreat into self-effacing, gun-shy cliques reinforcing stereotypes of Chinese men as soft; 

Second- and third generation American Born Chinese struggle to reconcile the imperatives of Chinese heritage - obedience to parents, obsession with “face” - with US individualism. Identity confusion sometimes results in an odd hyper-Americanism; 

Oversees students, acutely aware of the deficiencies of China’s memorization-based education system, nonetheless avoid Western liberal arts like the plague. The most popular majors are still engineering, math and business; 

Starting in 2004, the government opened hundreds of Confucius Institutes to promote inter-cultural “harmony.” Due to a dearth of effective outreach ambassadors, they have ended up as language schools; 

So China’s road to becoming a “soft” superpower will be long and rocky indeed.

Much more in the Huffington Post.

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China joins global rebellion against consumerism - Shaun Rein

Shaun Rein

A growing movement of consumers buy less, but focus on experiences. And, surprisingly, Chinese consumers follow that minimalistic trend, says Shanghai-based business analyst Shaun Rein in Knowledge CKGSB.

Knowledge CKGSB.

Not only are people buying less stuff overall, but a growing subculture is rebelling against consumption altogether. Minimalist bloggers, tidy-up gurus, and tiny-house designers now claim millions of followers. 

Nor is this only a trend in the jaded West. Many Chinese consumers are also getting less interested in buying things, according to Shaun Rein, Managing Director of the China Market Research Group. 

“It is not all about consumption and showing off anymore, especially among younger consumers. They are looking more for quality of life, which is pushing spending toward wellness, entertainment and more spiritual endeavors,” he says. 

Are consumers just taking a breather, or is something more permanent going on?

More in CKGSB.

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Facial recognition: the new norm - Matthew Brennan

Matthew Brennan

Social media expert Matthew Brennan gives ten case studies on facial recognition in China at his China Channel. Facial recognition is becoming fast the new norms, and he summarizes a few reasons why the new technology is taking off so fast.

Matthew Brennan:

Chinese people are incredibly accepting of change and like to embrace new things. They expect continual improvement in the technology around them and this new technology is not questioned to the same degree was in the West. 

Although it’s wrong to say Chinese have no concerns about privacy, we can definitely say that the overall level of concern is much lower than in the US or Europe. There are fewer suspicions of where their data is going or how it’s being used. 

Facial recognition technology really hits the sweet spot of two areas that are top priorities for the Chinese government: 

a. It is now the stated goal of the Chinese government to lead the world in AI related technologies by 2030. 

b. The primary need for control of information and society. Ubiquitous facial recognition technology makes it much easier to track individuals. 

A key difference in this area between China and the States is that it is much easier for startups in China to become profitable in this area as many government departments want solutions and have budget to pay.

More at the China Channel.

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Tencent and Alibaba: China's two internet ecosystems - Matthew Brennan

Matthew Brennan

China is not having one internet apart from the rest of the world, but two, tells internet expert Matthew Brennan. Both Tencent and Alibaba have their own ecosystems, and they do not talk to each other. When dealing with China's internet, you need to deal with both, he tells.

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How Taiwan can become an economic tiger again - William Bao Bean

William Bao Bean

Taiwan used to be one of Asia's economic tigers, but has a hard time to follow dynamic change of the past decade. VC-veteran William Bao Bean tells the Red Herring what the island can do to improve its startup culture and lure Taiwanese entrepreneurs back.

The Red Herring:

Now, with Southeast Asian neighbors hopping aboard to make the region one of tech’s brightest, Taiwan is trying to get its tiger roaring once more. 

Taiwan is home to around 140,000 manufacturing SMEs, the majority of which are based in the country’s densely-populated capital, Taipei. Few, however, have transitioned into software. William Bao Bean, a partner at investor SOSV and managing director at Taipei-based mobile-only accelerator MOX, believes there are three reasons why. 

The first, he says, is investment: “There are many well known Taiwanese internet entrepreneurs. The issue is that they founded a startup, left Taiwan and never came back. One of the most important things about having a startup ecosystem is that they come back and invest through angel investment dollars. That did not happen.” 

Bao Bean’s second reason for Taiwanese startup stagnation is that hardware investors are “quite risk averse. In the early days of the internet, ten years ago, they did a couple of internet projects and ended up losing money. So they came to the conclusion that either their family lacks investment or the internet sucks.”... 

Bao Bean and his MOX colleagues are trying to “encourage people to come back” to inject life into Taiwan’s startup ecosystem. “I pay for plane tickets and hotels for anybody who wants to come back and mentor for a few days,” he says.

More in the Red Herring.

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Why Catholicism is shrinking in a increasing religious China - Ian Johnson

Ian Johnson

Protestantism, Buddhism and Taoism grow fast in China, but followers of the Catholic faith are dwindling.  Author Ian Johnson of The Souls of China: The Return of Religion After Mao reports from the countryside on why Catholicism finds it harder to find a solid footprint among Chinese looking for moral values, for the America Magazine.

Ian Johnson:

A key reason for this divergence goes back to the issue of localization. The church’s reluctance to indigenize until the mid-20th century contrasts with the explosive growth in the number of indigenous Protestant leaders as early as the 1920s and ’30s. Many were jailed by the Communists, but their followers formed the basis of today’s huge Protestant “house church” movement. For better or worse, Protestantism in China travels lightly, with self-taught pastors forming churches and attracting large congregations in only a few years. 

This sort of spontaneous institution-building is harder to realize in a more formally structured faith like Catholicism. This is especially true because of China’s state control over religion. In the 1950s, the Communist government set up patriotic associations to control all five religious groups in China—Buddhism, Catholicism, Islam, Protestantism and Taoism. These committees now manage mosques, temples and churches, appoint key clergy, and run seminaries. 

For groups like Protestants, government control is a burden, but they are more decentralized, so they can ignore hierarchies and flexibly respond to demand. Put simply, any pious believer can form a Protestant church and declare himself or herself head of it. 

That is harder for Catholics to do. After the Communists set up the Chinese Patriotic Catholic Association in 1957, state officials began appointing their own bishops. Many Catholics began to feel uncomfortable about attending churches under government control and some stopped going. Others set up an underground Catholic Church in certain parts of China. This church does not recognize the “patriotic” church’s legitimacy. But even the underground church has a fairly rigid hierarchy, with appointments requiring approval by highers-up in China. 

Over the years, the split between the “open” and the underground church has become less pronounced, especially after Benedict XVI’s letter to the church in China in 2007. In it the pope essentially said the underground church should not be a permanent institution (“the clandestine condition is not a normal feature of the Church’s life”) and that Catholics can participate in services offered by the state-recognized church. 

But state control over religion is still problematic, hampering growth and regularly spilling into public view. In 2012, for example, the government appointed Thaddeus Ma Daqinauxiliary bishop of Shanghai. But Bishop Ma announced his resignation from the Patriotic Catholic Association at his episcopal ordination Mass—apparently a protest against the government’s regulation of religion. He was put under house arrest at the Sheshan Seminary, where he largely remains today, a situation that shut down one of the country’s most important seminaries for over a year.

More at the America Magazine.

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22 years of connecting Asia - William Bao Bean

William Bao Bean interviewed

VC-veteran William Bao Bean tells about his 22-year adventure of connecting tech, banking and the internet in Asia, at Haymarkt HQ, and answers questions by Angela Kwan and her audience. How does China's internet work?

William Bao Bean is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? 
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Are Alibaba and Tencent becoming too powerful? - Matthew Brennan

Matthew Brennan

Both Tencent and Alibaba have become power players, even eclipsing the formerly leading economic state-owned companies, says innovation-specialist Matthew Brennan in ATimes. So maybe they [think they] need to clip their wings a little,” adds Mr Brennan.

ATimes:

In many ways what they are doing dovetails with the central government’s goals of restructuring China into a service oriented economy, and making the country a leader in technological innovation. Because of this, industry leaders have clearly been given the green light thus far to forge ahead with their disruptions. 

But Matthew Brennan of China Channel, a consultancy that has followed Tencent since it was listed in 2014, tells the Financial Times that he agrees with those who believe it and Alibaba have become too powerful. 

Alipay and WeChat pay says Mr Brennan, for example, are good for the economy and put China at the cutting edge of mobile payments. But at the same time “they are undercutting the SOE banking sector and have done so very rapidly, and that could lead to instability . . . too much disruption going on could spill over into unrest. So maybe they [think they] need to clip their wings a little,” adds Mr Brennan. 

Warning signs, as the FT writes, seem to be largely concentrated in the payments, financial services and gaming industries.

More in ATimes.

Matthew Brennan is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

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How can new technologies find space in travel - William Bao Bean

William Bao Bean

Getting space in travel is hard for startups in new technology, says VC-veteran William Bao Bean, general partner at SOSV, as companies like Priceline and Ctrip in China dominate the industry. Unless you are able to solve specific problems, he tells WebinTravel.

WebinTravel:

“Travel is a closed insular industry, there’s a lot of history and baggage. The incumbents really don’t want it to happen – it’s not in their interests to open up too much. It’s also hard to compete against the likes of Priceline that spends US$6 billion on marketing or Ctrip, which is so dominant in China.” 

He however sees opportunities for “innovating around travel for companies that solve specific problems”. 

Bao Bean said that SOSV, which groups seven accelerators, does about 150 investments a year, out of which there may be two to four in travel. In total, SOSV’s portfolio includes 700 investments, with the number one sector being biotech and fossil fuels. Bao Bean also founded MOX, SOSV’s Mobile-Only Accelerator, in partnership with GMobi, the largest mobile platform for South-east Asia and India. 

In addition, he is also an active angel investor, doing about 40 investments a year personally. 

His interests in travel range from luxury travel – one of his investments include Go Portier, the hotel concierge service used at The Siam in Bangkok – to the corporate segment through an app that offers services in 20 cities across Asia Pacific. He’s also involved in Rikai Labs, a Shanghai and San Francisco-based startup that builds chatbots that are distributed via messaging platforms like WeChat, Messenger and Slack. 

Bao Bean is not afraid of testing – he tried social commerce for hotels “but it failed”. “You need decent engagement – event tickets, packages, weekend getaways, last minute trips – but it’s tough given Ctrip’s domination in the market.”

More in WebinTravel.

William Bao Bean is a speaker at the China Speakers Bureau. Do you need him in our meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts on innovation at the China Speakers Bureau? Do check out this list.