China’s economy was among the first in the world to rebound after the global financial crisis of 2008/9, formally overtaking Japan as the world’s second largest economy in February 2011. However, from early 2012, China’s growth began to slow as a negative consequence of the debt crisis in the Eurozone – one of their biggest markets for Chinese goods. But at the World Economic Forum’s summer meeting in Tianjin, premier Wen Jiabao remained optimistic, stating that China’s economy will soon stabilise, before continuing its “fast and stable” growth.
In this issue of Treasury Today in China we explore the latest updates in corporate regulation. The Chinese government recognises the need to strengthen China’s financial reporting and align with global standards. As such, the country’s regulatory bodies are diligently working to create an environment of quality in the application of accounting and internal controls over financial reporting. In turn, many corporates in China are training their talent, upgrading systems and enhancing their government structures to tackle these governmental regulations.
From an external perspective, China is commanding significant interest internationally from corporates looking for a favourable location in which to build their shared service centre (SSC). Influenced by a number of factors including labour cost, quality and availability, technical infrastructure, the regulatory environment, political stability, local language skills and tax efficiency; “China would be the recommended location of choice today” (Treasury Practice).
Yet many Chinese businesses are still feeling the effects of the economic slowdown and recent tax hikes are having a further impact on their cash flow strain. In a survey of Chinese corporates conducted by Ernst and Young in March, 44% of respondents stated that they intend to shift their focus to optimising capital over the next 12 months. We take a look at how companies can do this (Finance A-Z).
Following this issue, Treasury Today in China will be expanding to the rest of the Asian landscape. We are very excited to announce the launch of our new publication in January 2013, Treasury Today Asia. The new magazine will reflect on the trends, challenges and opportunities for treasury/finance professionals in the Asia Pacific region. Each edition of our audited bi-monthly publication will have a specific country focus and will include articles providing relevant insight and analysis through independent editorial content.
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We are interested to hear your thoughts, opinions and suggestions on the content we should be delivering as we move forward. Contact the Asia team by email email@example.com – or call us on +44 (0)13 0462 9006.