China Commercial Brief - September 2, 2005


U.S Commercial Service - American Embassy, Beijing
Vol. 2 No. 181

The China Commercial Brief is a biweekly publication featuring summaries about developments in China's various commercial sectors, tips on doing business in China, and U.S. Embassy news. This publication is free of charge; please forward it to your colleagues and friends who are interested in China.

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Editor: Matt Gettman
Contributors: Shen Yan, Wan Xiaolei, Xi Xianmin, and Wang Ling

News Briefs

1. Office Rental on the Rise in Beijing
2. China’s IP Telephone Market
3. China Implements Mandatory Standards on Home Appliances
4. China’s Increasing Demand on EDC for PVC Production

1. Office Rental on the Rise in Beijing

According to a recent research report released by a local real estate firm, Grade A office rentals in Beijing’s Central Business District (CBD) area have continued to increase in the third quarter of this year (2005) as a result of a lack of new supply. Rentals had surged in the second quarter. The average monthly rental of Grade A offices in the area reached USD32 per square meter per month, up 5.7 per cent compared to the previous quarter.

With the new supply expected to tighten in the following quarter, the vacancy rate in the CBD area will likely slightly decrease and rentals will increase correspondingly, according to the report.
(Source: Beijing Daily, 08/04/2005, translated by Shen Yan at

2. China’s IP Telephone Market

This IDC study forecasts the IP telephony equipment market in China in July, involving both sales to enterprises and sales to service providers, covering the period of 2003–2008. Both the IP telephony enterprise equipment market and the network equipment market will demonstrate strong growth through 2008.
According to IDC’s statistics analysis, the income of China’s IP telephone market reached USD 4.5 billion last year.

"From the viewpoint of both vendors and end users, the move to VoIP technologies is inevitable, but the time for the move hasn't arrived yet for every organization. In today's economic environment, enterprises are all trying to avoid unnecessary expenses. Therefore, companies with a sufficient installed base of legacy equipment are unlikely to shift completed to VoIP unless there is a clear advantage to doing so," says Michael Yan, senior analyst, Telecommunications, IDC China.
(Source: The Economic Observer, 08/22/2005- translated by Wan Xiaolei)

3. China Implements Mandatory Standards on Home Appliances

Beginning August 1, 2005, China started enforcing mandatory standards on allowable noise derived from home appliances and similar electrical devices. In May 2005, China started enforcing another mandatory national standard on the energy efficiency of washing machines regarding the cleanness ratio, power consumption, water consumption and noise drive.

The China National Home Appliance Technology Standardization Committee developed the mandatory standards, with participation from many manufacturers. The mandatory standard is imposed on 6 categories of home appliances. The maximum permissible noise derived from washing machines is required to be less than 62 db.
(Sources: China Electronics Daily, Page 6, 08/18/2005- translated by Xi Xianmin )

4.China’s Increasing Demand on EDC for PVC Production

At present, China has had a gradual increase in using EDC to produce PVC. In 2004, the total PVC production using EDC/Ethylene raw materials surpassed 40% of the total PVC production in China. Now, China is the fastest growing country in Asia Pacific region regarding EDC demand.

In 2004, China’s total import of EDC was 421,500 tons, while EDC consumption reached 2.5 million tons. During the first half of 2005, China’s total EDC import was 219,800 tons. With the increasing oil price, the total volume for EDC import was USD 105,000,000 that accounted for a 42.9% increase compared to that of last year.

U.S., Saudi Arabia, Indonesia and Korea are the four major EDC suppliers for China. In 2004, the export percentages to China were 27%, 23%, 15%, and 15% respectively. By 2008, China estimates that EDC production will increase with an annual rate between 6%-8%. Such an increase rate is similar to that of the PVC consumption increase.
(Sources: China Chemical Industry News Vol. 32, 2005- translated by Ling Wang )

DISCLAIMER: CS China does not guarantee the veracity of the original sources of our news summaries. While we do our best to report accurate and timely articles and news sources, you should always check the source for further information.

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