DOCSLIB.ORG

China Calling: the Rise of Chinese Bond Markets

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
China Calling: the Rise of Chinese Bond Markets JUNE 2021 China calling: The rise of Chinese bond markets INVESTMENT INSTITUTE FIXED INCOME FRANKLIN TEMPLETON THINKSTM MARKETS In this issue 3 Introduction 25 Local knowledge is the key to China Stephen Dover, CFA credit analysis Chief Market Strategist, Lirong Xu, CFA, CPA (non-practicing) Head of Franklin Templeton Investment Institute Chief Investment Officer, Head of Research & Analysis 6 China’s sovereign bonds: The alternate Franklin Templeton Sealand safe haven Fund Management Co., Ltd. Tracy Chen, CFA, CAIA Tracy Liu, CFA Portfolio Manager Fixed Income Investment Director, Brandywine Global Portfolio Manager Franklin Templeton Sealand 14 China’s banks embrace private innovations Fund Management Co., Ltd. Desmond Soon, CFA Head of Investment Management, Wang Fei Asia (ex-Japan)/Portfolio Manager Head of Credit Research, Western Asset Fixed Income Investment Management Department Franklin Templeton Sealand Swee-Ching Lim Fund Management Co., Ltd. Portfolio Manager Western Asset 30 China real estate—taming the grey rhino 20 Cyclical and structural factors point toward Changqing Gao, CFA Research Analyst, Corporate Credit a stronger renminbi Franklin Templeton Fixed Income Templeton Global Macro® Robert Nelson, CFA Portfolio Manager & Research Analyst, Emerging Market Debt Franklin Templeton Fixed Income Introduction In a year that saw record foreign inflows to Chinese bonds, 2020 was also a reflective year for me personally, having watched China’s economy grow over the last 40 years. I first traveled to China in 1982 as a student studying Chinese economics and history. Years later, I returned to help launch a local joint venture—Franklin Templeton Sealand Fund Management Co., Ltd. (FT Sealand), which was established in 2004. In the following five chapters from our fixed income managers, we examine China’s sovereign bonds, commercial banks, currency and corporates (state-owned and private). Here are a few of our key takeaways: Stephen Dover, CFA Chief Market Strategist, • Within a global framework, Brandywine Global believes China sovereigns fit better Head of Franklin Templeton directly alongside traditionally perceived safe-haven bonds like US Treasuries, rather Investment Institute than inside an emerging market debt allocation. China bond analysis, however, starts with a clear recognition that China’s capital markets aren’t purely “market driven.” • China’s economy is an evolving hybrid of top-down statecraft guided by policymakers and market-based capital allocations. In Chapter 2, Western Asset discusses how China’s six largest commercial banks are helping China achieve high-quality growth by putting private companies on a more level playing field with state-owned enterprises (SOEs). • One of China’s biggest strategic advantages is its ability to rapidly scale and deploy technologies to modernize its financial system and increase corporate competitiveness. Recent examples include the digitalization of China’s renminbi (RMB), discussed by Templeton Global Macro in Chapter 3, and high-tech industries like organic light- emitting diode (OLED) displays, an area where state resources can turn Chinese SOEs into global leaders, as discussed by FT Sealand in Chapter 4. • Of course, China’s top-down approach to boosting quality growth also produces regula- tory headwinds that impact bottom-up credit analysis. In Chapter 5, Franklin Templeton Fixed Income reviews a flurry of rules from recent years meant to de-risk China’s real estate sector; this alters the credit profiles of private property developers, who outnumber SOEs in this sector. It’s worth emphasizing that integrating China’s top-down policies into credit analysis is hard work. New macroeconomic rules don’t arrive in easy-to-read blueprints. Instead, policies written in Mandarin arrive in a matrix of interlocking documents from different Chinese agencies, impacting the broad bond market and individual corporates. China calling: The rise of Chinese bond markets 3 Knowing how China’s policymakers think To make the case for placing Chinese bonds In a tumultuous year for global bonds, China offered investors a bright alterna- inside global portfolios, each of the following tive in 2020. With its resilient economy, chapters explain how our investment managers sovereign bond yields reaching 3.3%1 and a rising currency,2 China’s sovereign integrate China’s macroeconomic innerwork- bonds had one of the world’s highest ings into sovereign, quasi-sovereign and total returns in 2020. Becoming a dominant player on the global stage has currency analysis along with bottom-up credit been one of the Chinese government’s analysis across corporate SOEs and private chief goals this century. Back in 2000, China’s bond market trailed far behind enterprises. Navigating Chinese bonds requires developed countries like Japan and unpacking past reforms following the global the United States by size.3 Today, the scale of China’s bond market is second financial crisis (GFC) and a raft of new policy- only to the US bond market. maker guidelines—all aiming to achieve Franklin Templeton was an early investor China’s goal of becoming the world’s largest in Chinese equities, researching compa- nies as early as 1987. While foreign economy by 2035. investment into China has historically been on the equity side, our indepen- dent investment managers have been and increased quantitative easing, sovereigns. China’s sprawling banking developing their expertise and exposure while many governments dramatically system plays a key role in China’s to Chinese bonds for many years. To increased fiscal spending and their pivot away from money-losing, debt- make the case for placing Chinese already gargantuan deficits. In contrast, laden “zombie” SOEs, and increasing bonds inside global portfolios, each of China’s quick containment of support for private enterprise. To grasp the following chapters explain how our COVID-19 meant it could resume its how far China’s banks have evolved investment managers integrate China’s previous glidepath of deleveraging. means examining the role they played in macroeconomic innerworkings into As Brandywine Global explores in pumping credit (much of it wasteful) sovereign, quasi-sovereign and currency Chapter 1, China’s disciplined approach into China’s economy after the GFC. analysis along with bottom-up credit to stimulus coupled with relatively Today, China’s policymakers are telling analysis across corporate SOEs and high bond yields attracted record banks to reorient loans toward privately private enterprises. Navigating Chinese foreign inflows into China’s government owned companies whose organic bonds requires unpacking past reforms bonds. Brandywine Global makes (not debt-driven) innovations can following the global financial crisis a compelling case for why China’s sover- generate high-quality growth. For (GFC) and a raft of new policymaker eigns now belong inside a developed China’s six largest banks, these risks are guidelines—all aiming to achieve market bond allocation rather than manageable given their ample exposure China’s goal of becoming the world’s lumped with emerging market peers. to systemically important SOEs. largest economy by 2035. Since the start of Xi Jinping’s presi- China’s forward-looking China’s economic reforms dency in 2013, China aimed to improve productivity growth by injecting more innovations One standout feature of China’s market-based discipline into capital and Across the investment teams featured in economy in 2020 was its disciplined credit allocations. In Chapter 2, our this piece, all five agree one of China’s use of stimulus to recover from the credit team from Western Asset explains biggest strategic advantages is its economic tailspin of the COVID-19 why offshore bond exposure to ability to rapidly scale and deploy tech- pandemic. Most of the world’s major China’s largest state-owned commercial nologies. For our Templeton Global central banks dropped interest rates banks offers a levered play on China’s Macro team, that technological edge is 4 China calling: The rise of Chinese bond markets manifest in the upcoming launch of SOEs fit inside China’s evolving indus- China bond categories China’s new digital currency, outlined in trial policies. Turning to privately To help orient readers to our five Chapter 3. Under development since owned enterprises in Chapter 5, our fixed income chapters, Exhibit 1 illus- 2014, the digitalization of China’s Franklin Templeton Fixed Income trates how the bulk of last year’s renminbi will likely accelerate the inter- team examines China’s drive to de-risk foreign inflows went into ostensibly nationalization of China’s currency. the overheated real estate sector. “risk-free” Chinese government and New regulations are forcing property policy bank bonds. In Chapter 4, the team at FT developers to shed assets and boost Sealand—our Shanghai-based joint near-term cash flows, in some cases For our chapters on bonds with incre- venture—explains how national by selling new homes at fire-sale mentally higher credit risks, such policies like “Made in China 2025” prices. Looking ahead to 2035, China’s as commercial banks and corporates helped jumpstart China’s push policymakers are guiding property (both state-owned and private), we note into OLED displays used in premium developers to build giant “city clusters,” that except for FT Sealand, most of mobile phones. FT Sealand explains each with capacity to house 100 our bond exposures in these categories why a major part of its credit million urban residents.
Load more

Recommended publications
  • March 2020 Show Some Legs …
    CHINAINSIGHT Fostering business and cultural harmony between China and the U.S. VOL. 19 NO. 3 March 2020 Show some legs … News, p. 3 Business & Economy, p. 5 History, p. 7 Shake. Stomp. Tap. Get those legs a-moving! What’s going on? New line dance at the gym? The Asian version of the Macarena? Whose behind this? Hint: see page 16. Community Society, p. 10 Snuff said! By Margaret Wong, Chinese Heritage Foundation Friends; contributor The first Liu’s perhaps surprising subject was corner from the Scholar’s Study for those Sunday Tea Mia’s collection of Chinese snuff bottles. of you familiar with the Museum’s layout). of 2020 pre- Originally a utilitarian personal accessory He titled this exhibit “Worlds in Miniature.” sented by Chi- for carrying snuff (powered tobacco), they These examples were the subject of the Feb. nese Heritage became an object of display for Chinese 16 talk and Powerpoint slide show. Foundation gentlemen of means. The art form began We learned that we can approach Chi- Arts & Culture , p. 14 Friends on in the 18th century when taking snuff by nese snuff bottles on many different levels. In This Issue Feb. 16 was way of the nose became fashionable in For example, we could begin by cataloging a fascinat- China. The practice of the art flourished the varied materials and techniques that have Arts & Culture 14 ing scholarly into the first half of the 20th century, and is been used. While most of us today associate Books 13 exploration still practiced, and the works are certainly snuff bottles with reverse (interior) painting Business & Economy 5 of what you collected, to this day.
    [Show full text]
  • Cultural Governance in Contemporary China: Popular Culture, Digital Technology, and the State
    ! ! ! ! CULTURAL GOVERNANCE IN CONTEMPORARY CHINA: POPULAR CULTURE, DIGITAL TECHNOLOGY, AND THE STATE BY LUZHOU LI DISSERTATION Submitted in partial fulfillment of the requirements for the degree of Doctor of Philosophy in Communications and Media in the Graduate College of the University of Illinois at Urbana-Champaign, 2015 Urbana, Illinois Doctoral Committee: Professor Emeritus John Nerone, Chair Assistant Professor Amanda Ciafone Professor Emeritus Dan Schiller Professor Kent Ono, University of Utah ii ABSTRACT This dissertation is a study of the historical formation and transformation of the Chinese online audiovisual industry under forces of strategic political calculations, expanding market relations, and growing social participation, and the cultural ramifications of this process, especially the kind of transformations digital technologies have wrought on the state-TV-station-centered mode of cultural production/distribution and regulatory apparatuses. Through this case, the project aims to theorize the changing mode of cultural governance of post-socialist regimes in the context of digital capitalism. Using mixed methods of documentary research, interviews with industry practitioners, participant observations of trade fairs/festivals, and critical discourse analyses of popular cultural texts, the study finds that the traditional broadcasting and the online video sectors are structured along two different political economic mechanisms. While the former is dominated by domestic capital and heavily regulated by state agencies, the latter is supported by transnational capital and less regulated. Digital technologies coupled with transnational capital thus generate new cultural flows, processes, and practices, which produces a heterogeneous and contested cultural sphere in the digital environment that substantially differs from the one created by traditional television.
    [Show full text]
  • Chinese Public Diplomacy: the Rise of the Confucius Institute / Falk Hartig
    Chinese Public Diplomacy This book presents the first comprehensive analysis of Confucius Institutes (CIs), situating them as a tool of public diplomacy in the broader context of China’s foreign affairs. The study establishes the concept of public diplomacy as the theoretical framework for analysing CIs. By applying this frame to in- depth case studies of CIs in Europe and Oceania, it provides in-depth knowledge of the structure and organisation of CIs, their activities and audiences, as well as problems, chal- lenges and potentials. In addition to examining CIs as the most prominent and most controversial tool of China’s charm offensive, this book also explains what the structural configuration of these Institutes can tell us about China’s under- standing of and approaches towards public diplomacy. The study demonstrates that, in contrast to their international counterparts, CIs are normally organised as joint ventures between international and Chinese partners in the field of educa- tion or cultural exchange. From this unique setting a more fundamental observa- tion can be made, namely China’s willingness to engage and cooperate with foreigners in the context of public diplomacy. Overall, the author argues that by utilising the current global fascination with Chinese language and culture, the Chinese government has found interested and willing international partners to co- finance the CIs and thus partially fund China’s international charm offensive. This book will be of much interest to students of public diplomacy, Chinese politics, foreign policy and international relations in general. Falk Hartig is a post-doctoral researcher at Goethe University, Frankfurt, Germany, and has a PhD in Media & Communication from Queensland Univer- sity of Technology, Australia.
    [Show full text]
  • Charles Zhang
    In a little over 35 years China’s economy has been transformed Week in China from an inefficient backwater to the second largest in the world. If you want to understand how that happened, you need to understand the people who helped reshape the Chinese business landscape. china’s tycoons China’s Tycoons is a book about highly successful Chinese profiles of entrepreneurs. In 150 easy-to- digest profiles, we tell their stories: where they came from, how they started, the big break that earned them their first millions, and why they came to dominate their industries and make billions. These are tales of entrepreneurship, risk-taking and hard work that differ greatly from anything you’ll top business have read before. 150 leaders fourth Edition Week in China “THIS IS STILL THE ASIAN CENTURY AND CHINA IS STILL THE KEY PLAYER.” Peter Wong – Deputy Chairman and Chief Executive, Asia-Pacific, HSBC Does your bank really understand China Growth? With over 150 years of on-the-ground experience, HSBC has the depth of knowledge and expertise to help your business realise the opportunity. Tap into China’s potential at www.hsbc.com/rmb Issued by HSBC Holdings plc. Cyan 611469_6006571 HSBC 280.00 x 170.00 mm Magenta Yellow HSBC RMB Press Ads 280.00 x 170.00 mm Black xpath_unresolved Tom Fryer 16/06/2016 18:41 [email protected] ${Market} ${Revision Number} 0 Title Page.qxp_Layout 1 13/9/16 6:36 pm Page 1 china’s tycoons profiles of 150top business leaders fourth Edition Week in China 0 Welcome Note.FIN.qxp_Layout 1 13/9/16 3:10 pm Page 2 Week in China China’s Tycoons Foreword By Stuart Gulliver, Group Chief Executive, HSBC Holdings alking around the streets of Chengdu on a balmy evening in the mid-1980s, it quickly became apparent that the people of this city had an energy and drive Wthat jarred with the West’s perception of work and life in China.
    [Show full text]
  • CHINA VANKE CO., LTD.* 萬科企業股份有限公司 (A Joint Stock Company Incorporated in the People’S Republic of China with Limited Liability) (Stock Code: 2202)
    Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. CHINA VANKE CO., LTD.* 萬科企業股份有限公司 (A joint stock company incorporated in the People’s Republic of China with limited liability) (Stock Code: 2202) 2019 ANNUAL RESULTS ANNOUNCEMENT The board of directors (the “Board”) of China Vanke Co., Ltd.* (the “Company”) is pleased to announce the audited results of the Company and its subsidiaries for the year ended 31 December 2019. This announcement, containing the full text of the 2019 Annual Report of the Company, complies with the relevant requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited in relation to information to accompany preliminary announcement of annual results. Printed version of the Company’s 2019 Annual Report will be delivered to the H-Share Holders of the Company and available for viewing on the websites of The Stock Exchange of Hong Kong Limited (www.hkexnews.hk) and of the Company (www.vanke.com) in April 2020. Both the Chinese and English versions of this results announcement are available on the websites of the Company (www.vanke.com) and The Stock Exchange of Hong Kong Limited (www.hkexnews.hk). In the event of any discrepancies in interpretations between the English version and Chinese version, the Chinese version shall prevail, except for the financial report prepared in accordance with International Financial Reporting Standards, of which the English version shall prevail.
    [Show full text]
  • Preservation of Lilong Neighborhoods in Shanghai
    PRESERVATION OF LILONG NEIGHBORHOODS IN SHANGHAI: SOCIAL CHANGE AND SPATIAL RIGHTS A Thesis Presented to the Faculty of the Graduate School of Cornell University In Partial Fulfillment of the Requirements for the Degree of Master of Arts in Historic Preservation Planning by Ran Yan August 2013 © 2013 Ran Yan ALL RIGHTS RESERVED ABSTRACT As once the most common form of dwelling in Shanghai, the Lilong has played a vital role in Shanghai’s local culture. Gradually declining in number during the second half of the 20th century, it is now faced with a challenging and undecided future. This thesis aims to further the discussion of the preservation of Lilong neighborhoods in its fundamental relation with people and basic social context. Four case studies, Tian Zi Fang, Jian Ye Li, Jing An Bie Shu and Bu Gao Li, are used to add some realistic, specific details and to deepen the reflection on this topic. Each of the cases has its special architectural features, residential composition, history, and current problems all of which provide some insight into the uniqueness and individuality of every Lilong neighborhood. In the end recommendations are made to address to Lilong residents’ right and to call for an equal way of Lilong preservation as a means to a better living environment for everyone and a more equitable society. BIOGRAPHICAL SKETCH Ran Yan was born on August 9th, 1988 in Beijing, China, where she grew up and finished her early education. In 2011 she received her Bachelor of Engineering degree in Historic Preservation from Tongji University, in Shanghai. With a background in both architecture and historic preservation, she continued on to graduate study in the Historic Preservation Planning program at the City and Regional Planning Department of Cornell University.
    [Show full text]
  • MADE in CHINA 2025 the Making of a High-Tech Superpower and Consequences for Industrial Countries
    MERICS PAPERS ON CHINA MADE IN CHINA 2025 The making of a high-tech superpower and consequences for industrial countries Jost Wübbeke | Mirjam Meissner | Max J. Zenglein Jaqueline Ives | Björn Conrad No 2 | December 2016 MADE IN CHINA 2025 The making of a high-tech superpower and consequences for industrial countries Jost Wübbeke | Mirjam Meissner | Max J. Zenglein Jaqueline Ives | Björn Conrad Made in China 2025 Contents Executive Summary ..........................................................................................................................................6 China’s industrial modernisation: a challenge to advanced economies ...................................................6 Made in China 2025 changes the terms of the game .........................................................................................6 Taking over international high-tech enterprises ......................................................................................................7 Will Made in China 2025 succeed? A mixed picture ...............................................................................................8 Key recommendations .....................................................................................................................................9 Policy makers .....................................................................................................................................................................................9 Industry associations ...................................................................................................................................................................9
    [Show full text]
  • We Profile Oriza – the Pre-IPO Investment Firm Behind SF Express
    1 Talking Point 6 Week in 60 Seconds 7 Economy 8 Energy and Resources Week in China 9 Banking and Finance 10 M&A 11 Internet and Tech 13 Chinese Model 14 China Consumer 17 March 2017 15 Rail and Infrastructure 16 Society and Culture Issue 358 20 And Finally www.weekinchina.com 21 The Back Page Ins and outs a n i h C e n i g a m I Shi Lirong retires from ZTE in a management reshuffle that followed a US government decision to fine the company $1.2 billion Brought to you by Week in China Talking Point 17 March 2017 Just fine ZTE’s record penalty in the US draws muted response in China Washington woes: ZTE promises to put thousands of staff through export-control training “ f people know you have the big condemning the Chinese firm for a 283 shipments of controlled items Ibazooka, you probably don’t have “brazen disregard of our laws as in - to North Korea with knowledge that to use it,” Wilbur Ross, Secretary of sulting as it was dangerous”. the shipments violated American Commerce in the Trump adminis - After weeks of testy relations export laws. tration, told Bloomberg last week. since Donald Trump took office, the As part of the settlement, ZTE will Ross was talking about how to announcement seemed likely to also plead guilty to two other win trade wars without firing a trigger another round of Chinese charges of obstruction of justice shot. But just two days earlier the 79 protests. Yet the response was sub - and making false statements to fed - year-old billionaire had pulled the dued and ZTE accepted its punish - eral investigators, according to a trigger on one of the most signifi - ment meekly.
    [Show full text]
  • 2019-Shanghai Basic Facts
    SHANGHAI BASIC FACTS 2019 Editorial Board Adviser: Zhou Huilin, Zhu Yonglei Editors-in-Chief: Xu Wei, Zhou Ya, Tang Huihao Deputy Editors-in-Chief: Yin Xin, Chen Yongqi, Qian Fei Editor: Cao Meifang SHANGHAI BASIC FACTS 2019 Compiled by: Information Office of Shanghai Municipality Shanghai Municipal Statistics Bureau ZHONGXI BOOK COMPANY SHANGHAI Located at the estuary of the Yangtze River in eastern China and facing the Pacific Ocean, Shanghai sprawls across an area of over 6,340.5 square kilometers with a population of 24.2378 million in 2018. Shanghai is China’s most thriving economic center, with GDP per capita climbing to US$20,398 by the end of 2018. Shanghai is a pioneer in China’s reform and opening- up, as well as innovation. A total of 670 multinational enterprises have set up regional headquarters in the city, and 441 foreign- invested R&D centers have also been established here. Shanghai is one of the world’s financial centers with its financial markets generating a total transaction volume of 1,645.78 trillion yuan and trading volumes of several products ranked top among global markets. An RMB products center, which matches the currency’s international status, has taken form in the city. Shanghai is an important shipping center, handling 730.4794 million tons of goods in 2018. On top of that, its international container volume reached 42.0102 million TEUs, the highest in the world for nine straight years. When it comes to the number of cruise ship passengers, the city ranked fourth in the world. Some 771,600 flights were processed at Shanghai Pudong and Hongqiao international airports, reaching 117.6343 million inbound and outbound trips.
    [Show full text]
  • Week in China
    1 Talking Point 6 Week in 60 Seconds 7 Economy 8 Internet and Tech Week in China 10 Healthcare 11 Banking and Finance 12 China and the World 15 China Tourist 16 China Consumer 14 February 2020 17 Society and Culture Issue 482 19 And Finally www.weekinchina.com 20 The Back Page Masked nation How is China’s government and economy coping with the spread of Exclusively the Wuhan virus? sponsored by Week in China Talking Point 14 February 2020 Dealing with disaster How is China coping with the coronavirus outbreak? Chinese President Xi Jinping on a community tour in Beijing this month he SARS outbreak nearly two plause and was taken as a sign of with a key post on the CPC’s Central Tdecades ago wasn’t simply a more accountable governance Committee.) public health crisis. For the Com - under new Party boss Hu Jintao, Nevertheless the CPC threw its munist Party of China (CPC) the epi - who took over in November 2002 as full political weight into averting demic presented a severe political the SARS virus started to spread in the 2003 crisis. Wang Qishan, now crisis that threatened its ruling le - southern China. China’s vice president after retiring gitimacy. More importantly it helped to as the anti-corruption tsar in 2017, In early 2003, amid mounting in - calm public anger, although Meng was parachuted in from Hainan, be - ternational concern and domestic would make a return to ministerial coming the new Beijing mayor. disquiet, the CPC sacked Meng rank five months later when he was Wang immediately put stringent Xuenong, who had only been ap - appointed to oversee a multi-billion quarantine controls in place.
    [Show full text]
  • Microfilming and Digitization of Newspapers in China
    Pre-conference of WLIC 2006 Preservation and Conservation in Asia National Diet Library, Tokyo, August 16 and 17, 2006 Microfilming and digitization of newspapers in China Chunming Li，Wei zhang National Library of China 1. Introduction Newspapers can preserve vast amount of first-hand historical information for research, and are reliable and valuable sources for studies on politics, economy and culture of a country and a specific period of society. Mr. Fang Hanqi, Chairman of the China News History Society and Professor of Journalism Faculty at Renmin University of China, once said that Newspapers are the draft versions of the history and newspapers are very important reference materials for historical research. It is critical for the newspapers collectors and researchers to pay attention to collecting, storing, and utilizing the newspapers of all times and to make good use of information in the newspapers for historic research. China’s history journalism could be traced back to Di Bao, a kind of news bulletin in the imperial court of the Tang Dynasty (618-907). With the economic development, there appeared the “Kai Yuan Za Bao” (713-734) which was a newspaper hand-written on silk. The progress of the history accompanied with the cultural development. Since the Qing Dynasty (1644-1911), a lot of influential Chinese-owned/managed newspapers had emerged, the well-known of these included “Shen Bao”, “Xin Wen Bao”, “Zi Lin Xi Hu Bao” etc. “Shen Bao” was published for 77 years (1872-1949) and released altogether 25600 issues, made the record in the Chinese newspaper history. Currently, there are around 1900 published newspapers in China.
    [Show full text]
  • MARKETING ACROSS CULTURES: a Case Study of IKEA Shanghai
    Lund University Centre for East and South-East Asian Studies Masters Programme in Asian Studies East and South-East Asian Track Fall semester, 2005 MARKETING ACROSS CULTURES: A case study of IKEA Shanghai Author: Ying Pan (Penny) Supervisor:Stefan Brehm ii Abstract The past century saw rapid growth of multinational companies around the globe. Along with the tide of globalization, these companies are compelled to deal with customers cultivated in different cultures. China, boosting a remarkable economic growth in the past two decades, stands out under the spotlight of international business. Being amazed by the huge business potential posed by a population of 1.3 billion, many multinational companies have joined the competition to attract Chinese customers. There have been losers and winners. IKEA is now on the right track. IKEA entered the Chinese market in 1998 by first opening a shop in Shanghai, the financial centre of the country and are now ready to expand further. The thesis presents a case study of IKEA Shanghai’s marketing performances from a cultural perspective, following the model of the marketing mix (the 4Ps). The findings convey an important message in terms of international marketing—the company must think globally and act locally in hope of building long-term customer relationships and capturing customer value. In marketing decisions, culture does not hold an ultimate status but still calls for due attention as much as other factors, such as the marketing environment and the company’s strategic plan. Key words: IKEA, marketing strategy, culture, cultural studies iii Contents 1. Introduction 1 1.1 Research question and aim of the research 1 1.2 Structure of the thesis 2 1.3 Previous research 3 2.
    [Show full text]