Posts Tagged ‘china’

‘Made In Italy’ By Chinese Workers, With Chinese Materials

Monday, September 13th, 2010

Times are changing in Europe, and Italy is struggling to maintain the integrity and marketability of its high-end fashion brand while dealing with an influx of legal and illegal immigrants from China.

  • The city of Prato in Tuscany has always been known for its quality textile production, but recently the industry has been taken over by Chinese companies known to use illegal labor and imported materials to feed a new low-end, “fast fashion” industry.
  • Part of the immigrants’ success in exploiting the local economy involves clever maneuvering around Italian laws and regulations. Companies operating in a “gray market” are not technically breaking any laws – they comply with most regulations – but neither are thy upholding the spirit of the laws. For example, a textile producer may refuse to inquire into whether his subcontractors use illegal labor.
  • The issue is sensitive in Italy, where immigration is a controversial and emotional subject. Some believe the situation in Prato is an intentional attempt at economic colonization by the Chinese government.

Facts & Figures

  • Since 2001, half of Italian-owned textile businesses in Prato have been replaced by Chinese-owned textile businesses.
  • Prato represents 27% of all Italian fabric imports from China.
  • Approximately $1.5 million a day is directed from immigrants in Prato back to China, though it seems that much of that money is not being claimed on tax forms.
  • Prato is home to about 25,000 mostly Chinese illegal immigrants.

Best Quote

“The Chinese are very clever. They’re not like other immigrants, who can be pretty thick. The difficulty is in finding a shared understanding of the rules of the game.” – Riccardo Marini, Head of the Prato branch of Confindustria, the organization of Italian industrialists

Why China’s Currency Change Matters To U.S.

Monday, June 21st, 2010

China changing its currency policy may mean a big change for everyone!

  • For a long time, China has (unfairly) kept the value its currency low because it helps keep Chinese industries competitive in the global market.
  • China is expected to finally make a change, after lots of pressure from the Obama Administration.
  • The change would mean a stronger renminbi (or yuan), more affordable American goods in China, and more expensive Chinese goods in America.
  • If the renminbi is allowed to fluctuate, it could potentially increase the value of the U.S. Dollar.

Facts and Figures

  • Since 2002, China has sold $2.187 trillion of its own currency to prevent it from gaining value.
  • China is currently exporting four times more to the United States than the U.S. is to China.
  • 6.82 renminbi equals 1 USD.

Best Quote

“Whether to let the yuan slowly appreciate or let it rise to a tolerable range after careful calculation, I think it is better to have that quick, prompt appreciation.” - Xia Bin, Member, Monetary Policy Committee of the Chinese Central Bank

Stocks, Bonds, Diamonds?

Tuesday, December 1st, 2009

A pink diamond sold for a record amount in Hong Kong to… an anonymous bidder.

  • A 5 carat pink diamond, the size of a chickpea, set in a silver ring was auctioned off for a record $10.8 million.
  • The diamond was sold to an unidentified individual. Christie’s International (which held the auction) would not confirm if he or she was Chinese. This unidentified person beat out Chinese millionaire and successful stock investor Liu Yiqian and his wife Wang Wei.
  • Many items that were sold in the auction sold for prices greater than their value due to a drive in Chinese buying and the growing interest in jewelery among the Chinese.

Facts & Figures

  • This pink diamond sale beats out the previous record of $10.5 million for a 7.03 carat blue diamond.
  • A cushion-shaped 16.65 carat sapphire set by Van Cleef & Arpels sold for just under $2.4 million.
  • Total sales at the Christie’s auction came to just under $48 million.

Best Quote

“Some prices were crazy, way above what one would pay even at a jewelry store. There’s a lot of mainland Chinese buying; either they didn’t know what the items are worth or they wanted them so badly that price didn’t matter.” – Donald May, Hong Kong-based Gem Dealer

Disney Goes To Shanghai

Monday, November 9th, 2009

After 20 years of negotiation, the Walt Disney Company will build its first Chinese theme park in Shanghai.

  • The opening of such a large American theme park will have many cultural and financial implications for Shanghai, a city proud of its rich cultural history.
  • The park will be bigger than the original Disneyland in Anaheim, California, and will be similar in style to the Paris and Hong Kong parks.
  • The goal of opening such a park is to create demand for Disney products (TV shows, movies, games, characters, toys, boardgames, DVDs and plenty more) among China’s 1.3 billion citizens.

Facts & Figures

  • The park will cost $3.5 billion dollars to build, will occupy at least 1,000 acres of land in the city’s Pudong district, and is set to open in 5-6 years.
  • Only 20 foreign films (often censored) are permitted to be shown in Chinese theaters every year.
  • Disney already sells Disney merchandise at 6,000 locations in China.

Best Quote

“It’s a signal that now they will tolerate a certain kind of Western investment” – Orville Schell, Director of the Asia Society’s Center on U.S.-China Relations