Construction Working Group Meeting Go back »
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Time2009-01-16 | 09:00
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Venue:Chamber Shanghai Office
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Address:Shui On Plaza,333 Huai Hai Zhong Road, Shanghai 200021
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Fee:Members: FREE
Venue: European Chamber, Shanghai office
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Name |
Company |
1 | Stefan Lammert | Halfen Beijing |
2 | Yongjun Gu | Halfen Beijing |
3 | Johannes Weilharter | Schulz Noack Bärwinkel |
4 | Stéphane Gasne | Gide Loyrette Nouel A.A.R.P.I. (Shanghai) |
5 | Tim Stoecker | Bureau Veritas |
6 | Benoit de Rivaz | Bekaert |
7 | Luise Schafer | Abacus Lighting (Shanghai) Ltd |
8 | Helen Chang | Pinsent Masons LLP |
9 | Andy Wang | Pinsent Masons LLP |
10 | Sarah Dumbrill | French Consulate |
11 | Oliver Yu Qing | Capital Eight |
12 | Tony Brooks | EUCCC |
Agenda:
1. Position Paper update. Possible meetings with Shanghai Construction Bureau and Port Authorities.
The Construction Working Group has not managed to secure a meeting with the Construction Ministry (now re-named MoHURD) in Beijing. However, the Working Group in Shanghai has managed to find contacts in the Shanghai Construction Bureau and it is intended to try and set up meetings with them in the first instance. There are certain Chinese ministries, such as NDRC and MoHURD, which very rarely meet with Chambers of Commerce, diplomats or politicians. The Chair and the Vice Chair of the Shanghai Construction WG have both announced their intention to step down this year, which means that organising meetings with government will have to wait until after the Working Group elections in March. The Chamber has contacts with the Shanghai port authorities, and once the new chair/vice chair are elected a meeting will be arranged to discuss the problems facing European dredging companies, which administratively fall under dredging.
2. Results of questionnaire to WG companies on business sentiment during the downturn.
Members discussed the results of the questionnaire on business sentiment, which are attached to these minutes. The consensus of opinion was that during the first half of 2009 business for the Construction industry will slow. However, as the effects of the stimulus package kick in, business should pick up. Specific comments from individual members:
* Airlines are being badly hit by the downturn, however, airport construction will boom, as over 100 new airports are being planned.
* Law firms expect more claims and disputes during the downturn.
* From an investment perspective, Chinese companies are currently very cautious about spending at the moment. They are especially wary of expanding abroad through Mergers & Acquisitions (M&As), because they normally exit such projects by an Initial Public Offering (IPO) and these are currently pretty much suspended.
* The infrastructure part of the 4 trillion RMB stimulus package is quite a closed market. European companies can sell equipment into this market, or provide knowledge transfer, particularly if they are seen as local companies or JVs. As an example of the low involvement of foreign companies in infrastructure investment, it is estimated that for the high speed rail-link currently being constructed between Beijing and Shanghai, only 30 or so foreign engineers will be employed.
* The market for steel chord has been badly affected by the down-turn. For example, tyre factories are being forced to close through lack of demand for new cars. However for buildings, steel companies are concentrating on foreign investment, which mandate high quality steel chord/cables for reinforcing. Demand will be weak for the first half of 2009 for steel chord, so some companies are looking to strengthen their links with State Owned Enterprises (SOEs).
* Port construction activity is also contracting. With the help of government led investment, port construction underwent a boom in the mid 1990s. However, with a sudden recent drop off in demand for port facilities because of shrinking export shipments, port construction has ground to a halt. It appears that the majority of the infrastructure stimulus package is not directed at ports.
* The rail network is expected to benefit from the stimulus package, with huge funds being devoted to expanding capacity. The government plans to double both passenger and freight capacity by 2020.
* Monies allocated to health and education are partly for building new schools and hospitals.
Detailed plans are currently being drawn up for the stimulus package.
3. Update on SWITCH Asia EuropeAid cooperation project.
Members were informed that contracts have now been exchanged for this 4 year project, which is due to commence in March 2009. A fact sheet for the project can be viewed here.
4. Legal update and construction related news/legislation.
No new legislation affecting construction companies has been promulgated during the past few months. It is intended that the Business Manager for the Working Group will send out relevant news and legislative updates approximately once every month.
5. Update on possible lobbying issue: Licensing for dredging companies.
Once the new Chair and Vice Chair are elected, the port authorities will be contacted for a meeting to discuss dredging issues.
6. Health & Safety: “Worksafe China 2009” Conference, 24-25 March 2009, call for speakers.
The Business Manager for the Working Group was recently contacted to ask if any European Chamber member was interested in speaking at this event. However, the conference seems to have been postponed or cancelled.
7. AOB Next meeting dates.
The next Shanghai Construction Working Group meeting will be held at the European Chamber Shanghai office on Friday 20th March. This meeting will include elections for Working Group Chair and Vice Chair.
For minutes download, please press here.
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