November 30, 2005

City of factories showcases its luxurious side

SHENZHEN -- The video zipped across a big projection screen: flashing images of cargo ships, men shaking hands, soaring office towers, gardens, trees, the symphony.

Seattle?

No. Shenzhen, one of the busiest manufacturing hubs on the planet.

Seattle trade-mission delegates have traveled 6,500 miles to sell the Puget Sound region and its products to China. But they also sat politely as their hosts made a counterpitch.

The video fired a barrage of figures. This being Communist China, there was no bad news. Last year, Shenzhen's imports and exports made it the third-busiest port in the world. Most indicators were up by double-digit percentages from last year.

The city also was selling its beauty. "Shenzhen is a city of design," the narrator intoned as the video zoomed through lush parks and along tree-lined boulevards. "It strives for not being big in scale, but vast in quality."

In 1980, Deng Xiaoping picked Shenzhen as a special economic zone, freeing the economy to adopt limited capitalism. According to lore, Shenzhen was a sleepy fishing village of 30,000 back then. "Deng said, 'If we mess up here, it's OK,' " joked Kenneth Tse, general manager of Yantian International Container Terminals, one of Shenzen's four ports.

Twenty five years later, the city is bigger than New York, with 11 million residents, including 5 million without official residency permits. It is dominated by sleek office and housing towers that surprised the Seattleites.

"I was expecting a lower level of living," said Candace Lydston, director of 737 materials management at Boeing. "I haven't seen one water buffalo."

Most of the city is landscaped like a park, with palm and banyan trees planted so thick along the broad boulevards they often obscure the buildings. The government said it spent $12.3 billion on parks and green belts in Shenzhen.

One billboard advertised lingerie. Another, Rolls-Royce cars. "Comes with burglar alarm," it said.

"Seeing is believing," said Chen Yingchun, vice-mayor of Shenzhen, clearly proud of the city's standard of living.

Chen held a formal reception for the delegates in digs normally reserved for heads of state: A giant sitting room, red carpet and golden wood panel walls, flanked with giant yellow brocade chairs with large white doilies on their arms. At one end of the room, in larger, more ornate chairs, sat vice-mayor Chen and Nancy Anderson, a vice-president at Microsoft.

"China is still a developing country," said the vice-mayor, who wore a dark blue suit and large black-rimmed glasses. "We hope that through cooperation with Seattle, we can learn from those advanced companies in the world."

An official delegation from Shenzhen's Longgang District arrived in Seattle yesterday and will meet with officials from Boeing, the local software industry and others active in international trade.

Broadband connections and worker dormitories

It was hard to think of it as a developing country after seeing apartment blocks where units sell for about $175,000 for 1,000 square feet, and rent for $1,250 a month, according to a broker at Shenzhen-Hua Real Estate. The average income in Shenzhen is about $7,000, six times the national average.

Alberto Vettoretti, a lawyer at Dezan Shira & Associates, a China-based law firm, said nine out of 10 Shenzhen homes have access to cable TV, and eight in 10 families have computers. The video claimed the government's goal of putting fiber-optic Internet connections in all buildings was "basically completed."

Here, the only visible reminder that China lags the developed countries was the heavy smog that dulled the sun and shortened the views. The smog comes from coal-fired power plants needed to keep up with rising electricity demand. Coal mining is increasing 40 percent this year in an effort to cope with blackouts that happen once or twice a week during peak months, Vettoretti said.

But on the bus driving to Guangzhou that night, delegates saw the Shenzhen that the video and vice-mayor avoided mentioning: Miles of concrete buildings, fluorescent lights blazing inside. Most of the estimated 60,000 factories in Guangdong province are along this road. The delegates saw thousands of low-wage workers on the night shift making the world's electronics, shoes, computers and toys.

"You could see whole floors. There was nothing but heads," said one delegate, who didn't want to be quoted by name criticizing China. "It was like a hive."

Next door stood dormitories furnished with metal bunks and blankets. Row upon row, block upon block.

Yanan Xu, program director for Bellevue-based City University and a Chinese native, said most of those workers will never earn enough to live in the nicer apartment buildings. They hope to give their children an education, and through that a chance at upward mobility.

Trading with places like Seattle is how Shenzhen hopes to do it.

Alwyn Scott 206-464-3329 or ascott@seattletimes.com

Posted by Al Scott at 10:42 AM   |  Post / Read Comments (0)

November 28, 2005

Hong Kong's comeback bid awes Seattle visitors

HONG KONG -- The Seattle delegates strode, heels clacking, across gleaming black granite floors in a soaring glass-and-steel office building.

They passed an indoor "street" lined with trees and cafe tables, beneath an arching glass canopy two stories above. Outside, manicured gardens surrounded fountains, ponds and more modern buildings.

The campus would look snazzy even in tech-savvy Seattle. But this is the headquarters of the Hong Kong Science and Technology Parks, a technology "incubation center" that opened on the outskirts of Hong Kong last year. It certainly stood out amid the tired, decades-old apartment blocks in nearby Kowloon.

Much like Seattle's South Lake Union and North Bay projects, HKSTP is a bid by the government to revitalize the local economy.

That's right, Hong Kong's economy needs help. While mainland China is growing like gangbusters, the economy of Hong Kong, a city of 7 million, has just emerged from recession.

Poised between Guangdong province, mainland China's massive manufacturing hub, and the hungry U.S. consumer market, Hong Kong is well-positioned to handle much of that trade and the financing that goes with it.

But Hong Kong suffered a deep blow as a million manufacturing jobs moved away in the 1990s, shifting across the water to tens of thousands of factories sprung up on the mainland.

Just like the U.S., Hong Kong lost factory jobs to China's low-cost labor and vigorous embrace of market economics. Though nearly three-fourths of those Guangdong factories are owned by Hong Kong businesses, the migration had a big impact on employment in the city. During the recession, one in three Hong Kong residents under 35 was unemployed, according to officials.

Government invests billions

So Hong Kong's government, which is administered separately from the mainland, is spending on a scale that made Seattle visitors gasp. It spent $1.5 billion to build HKSTP and splashed out $2 billion more for Cyberport, another high-tech development.

"You get the feeling the government is racing to catch up," said Everett Mayor Ray Stephanson, a delegate on the China trade mission organized by the Trade Development Alliance of Greater Seattle.

Listening to the HKSTP sales pitch, Bill Stafford, president of the Trade Development Alliance, added dryly: "People complain about the minimal support for South Lake Union."

HKSTP has 3.3 million square feet of rental space, the equivalent of more than two Columbia Towers. It charges tenants $1 per square foot a month in rent.

The project doesn't just provide state-of-the-art office space, as South Lake Union and North Bay envision. It offers the computers, software and equipment a company needs to get rolling in four areas: integrated circuits, electronics, biotech and precision engineering. Software packages that cost $1 million can be rented by the hour.

Its motto: Just plug and play.

"After 1997, the government got pro-active," said John Lo, vice president of marketing for HKSTP. "It needed to convert high learning (from the universities) into applied companies."

Across the bay, Cyberport is like a small city, resembling the Battery Park City-World Financial Center complex in lower Manhattan. It has a million square feet of office space, 300,000 square feet of retail and 2,800 apartments in thin towers that shoot into the sky. Cyberport has sold 1,987 of them at an average price of $1 million apiece, raising nearly $2 billion, said Cyberport Chief Executive Nicholas Yang.

Success still uncertain

Cyberport is supposed to attract companies developing Internet and wireless technology. Wired with fiber-optic cable and connected to Hong Kong's three Internet backbones, it offers 10 gigabit per second connectivity, along with high-tech imaging, audio and wireless equipment for rent. It even has a Starbucks.

Both parks say they're doing well. HKSTP says its million-square-foot first phase is fully rented, and Cyberport says it is 55 percent full.

But it's unclear if either example of government investment will be a success.

Some critics call Cyberport a failed experiment, already passed by technology and trying to reposition itself. After failing to attract many of the small digital-content companies it sought initially, Cyberport wants bigger companies that could probably afford to locate anywhere. Microsoft has two floors in the main tower, and uses the office as a hub for Asian operations, especially intellectual property issues, said Nancy Anderson, a Microsoft vice president who is one of the trade mission delegates.

Still, given the government backing, the parks can afford to be a little choosy. Yang said the World Trade Organization wanted to set up an office at Cyberport. But Yang refused. "You have nothing to do with digital content," he told WTO officials.

Alwyn Scott: ascott@seattletimes.com

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Even Hollywood types buy China's counterfeits

SHANGHAI -- A Hollywood film crew arrived here to work on the next "Mission Impossible" movie being filmed near Suzhou, about an hour outside Shanghai. With a few days off from shooting this week, some members of the crew went on shopping trips in downtown Shanghai.

Among their purchases, hauled back to hotels in black plastic bags, were stacks of pirated DVDs. The going rate was 7 renminbi (about 88 cents) for DVDs in plastic wrap and 10 renminbi (about $1.25) for boxed versions. The shoppers also brought back bundles of fake North Face jackets. Those driving a hard bargain picked up copied wind-stopper jackets for 120 renminbi each (about $15).

Movies aren't the only item readily copied around here.

It's hairy crab season in eastern China, where the famed Yangcheng Lake crabs are the favored delicacy in markets and restaurants. But other less-than-authentic crabs are often sold as their more expensive cousins.

The situation has inspired a few jokes.

Crabs from other areas put into Yangcheng Lake at the last minute are said to have gone out for "professional training." Crabs taken from the lake but raised elsewhere are said to have "studied abroad."

Bird flu update

China reported a second person in Anhui province died of the avian flu virus Nov. 22, bringing the death toll to three.

(The death of a girl in Hunan is officially listed as probable but unconfirmed. Health authorities said she was cremated before sufficient evidence could be gathered.)

The U.S. Consulate in Shanghai recently issued a bulletin to American citizens in China, saying the Chinese government had shown "a welcome trend" of increased transparency in handling the outbreak and active measures to fight avian influenza. The consulate advised citizens to avoid areas where outbreaks have occurred.

Evidence of sinking chicken sales could be found at McDonald's in Shanghai, where signs on tables aimed to reassure customers about the safety and quality of the meat. Prices were slashed 30 percent for crispy chicken wings and chicken sandwiches.

Posted by Kristi Heim at 09:53 AM   |  Post / Read Comments (0)

November 23, 2005

Pirated 'Harry Potter' already selling in Beijing

Just days after "Harry Potter and the Goblet of Fire" premiered on the big screen, pirated versions of the new movie went on sale for about $1 from street hawkers in Beijing.

The movie debuted last Thursday in Beijing and Shanghai. California Gov. Arnold Schwarzenegger, in Shanghai on a trade mission, walked down the red carpet to attend the premier.

Theaters in China began showing Harry Potter's latest adventure at the same time as those in North America, in part to thwart pirates. Tickets sold for about $7.

Before the screening, in a short public service announcement, Schwarzenegger appeared on a motorcycle alongside actor Jackie Chan urging people not to buy pirated DVDs. Buying fake DVDs is like giving money to criminals, they said.

President Bush also made protection of intellectual property a key theme of his recent state visit to China.

But as the Terminator talked tough on intellectual property rights, pirates wasted no time getting the goods.

Street sellers, who kept a low profile while the guests were in town, came out in force again by Tuesday.

They were selling a slickly packaged DVD with a full-color, glossy paper cover and description in English and Chinese. But the wording revealed the copycats’ haste.

A message at the bottom of the package was filled with typographical errors:

"Fedral law provides severe civil and criminal penalties for the unauthorized reproduxtion distribution or exhibition of copyinghted motion picture videotapes."

Yet some good news for Hollywood could be found in the mix. China evidently has demand for both kinds of movies.

On Saturday evening, a theater showing the Harry Potter movie in Beijing's university district was packed full of paying customers.

Posted by Kristi Heim at 09:14 AM   |  Post / Read Comments (0)

November 22, 2005

Bird flu worries take a toll on China's menus

ALAN BERNER / THE SEATTLE TIMES A Peking duck is taken out of the oven at a downtown Beijing restaurant and is ready for carving. Since the H5N1 avian-flu virus spread to six Chinese provinces this month, Chinese diners have started avoiding chicken, duck and other fowl.

BEIJING — On an unusually warm evening for late November, crowds of people were out trolling the colorful food stands of the Wangfujing Street night market.

The once-popular chicken skewers have all but disappeared from the menu. There's not much demand for poultry these days.

Since the H5N1 avian flu virus spread to six Chinese provinces this month, Chinese diners have started avoiding chicken, duck and other fowl. Some large hotels catering to Americans have even cancelled their traditional Thanksgiving turkey dinner.

On Tuesday evening, both floors of the Beijing Style Roast Duck restaurant were empty. Bored-looking clerks in green uniforms stood by waiting for customers.

"It's probably best not to eat it," said Li Jin, 23, who came to the night market with three friends to snack on barbequed meat. "But it's an individual choice."

"It takes a high temperature to kill the virus," his friend, Wang Wenping, chimed in. Wang, 23, held a cigarette in one hand and a skewer of grilled lamb stomach in the other. "As for me, I don't care. If it tastes good I'll eat it."

There's no evidence that people have contracted bird flu from eating poultry, and experts say that cooked meat poses no risk.

Chinese authorities are combating the deadly virus with bird vaccines, quarantines, blockades around outbreak sites, slaughter of infected birds and other measures. China is trying to vaccinate all poultry in the country. Beijing has closed its live bird markets.

So far the virus has hit birds in six provinces. China has confirmed two human fatalities from the virus: a pregnant woman in Anhui, and a girl in Hunan whose brother also had H5N1 but recovered.

In a country that experienced the SARS crisis two years ago, bird flu does not immediately trigger a panic.

Aside from eating less poultry, people haven't altered their normal routines.

"Some people say you shouldn't care too much about this problem," said Li. "There is already a vaccine for birds."

China is also working on a vaccine for humans, which it says worked effectively on mice. Researchers plan to begin clinical tests on humans later this month.

In the meantime, stray pigeons caught in downtown Beijing will pay a price: they'll be caged until the bird flu threat is over.

Kristi Heim: 206-464-2718 or kheim@seattletimes.com

Posted by Kristi Heim at 01:35 PM   |  Post / Read Comments (0)

November 20, 2005

Masses don't tune into Bush message

BEIJING — President Bush was in China for two days, talking in part about religion and democracy. But that message has mostly been lost on the Chinese people.

For one thing, Chinese media haven't focused much on Bush, devoting most of their time and space to quoting Chinese leaders. For another, unlike his predecessor, Bush hasn't circulated widely in the city or had any forum to directly address the public.

His visit has been highly orchestrated, punctuated by tight smiles during formal meetings with China's top two leaders and a bike ride around a mountain-bike course with six Chinese cyclists.

The White House had urged China to allow its state-run media to give extensive coverage to the visit. Reports in the U.S. media showed Bush praying with Christians at a church in Beijing and raising questions of human rights and the fate of a Chinese dissident.

But in China, those issues did not make news. Chinese television focused mainly on remarks by President Hu Jintao. The only direct statements by Bush broadcast were quips about the bicycle ride and an invitation to Hu to visit Washington.

Philip Cunningham, an American freelance writer and political commentator for Chinese television in Beijing, said the trip was a marked contrast to a 1998 visit by President Bill Clinton.

"There was an overflow crowd wherever he went," Cunningham said of Clinton's visit. "He was allowed to get on live national TV and talk about issues like Tibet. This is more tightly scripted because Bush doesn't have that rapport" with China's leaders.

Arriving at a time when his administration and U.S. foreign policy in general are unpopular in China, Bush met with limited success on political topics. He gained some ground on issues causing trade frictions, such as intellectual property.

But not everyone welcomed the visit.

"You're American? So Little Bush is yours? He's not welcome," said a clothing seller in Shanghai's sprawling Xiang Yang market. "He's always attacking weaker countries and trying to limit China's development."

In Beijing, recent university graduate David Wang, 22, said Bush's trip to China "is of great significance" for U.S.-Chinese relations. The U.S. needs China's cooperation to address major world problems, he said.

"I think sometimes George Bush should listen to more people's opinions instead of political interests," Wang said. "He should try to accept China. China's strength is not a challenge for America. In fact, it can be a help."

Chinese leaders used the phrase "mutual respect" several times during meetings with Bush, reflecting their demand for an equal status.

In part, it reflects rising confidence bolstered by unprecedented economic growth.

For the United States, the underlying message from China was "don't think about wagging your finger at us," Cunningham said.

Regardless of political differences, U.S. citizens and culture still get a warm reception in China.

"I regard American people as very kind," said Wang. Your enthusiasm, your openness — we should learn from this."

"There is a gap in our politics, but not in relations between people," he said.

Kristi Heim: 206-464-2718 or kheim@seattletimes.com

Posted by Kristi Heim at 10:23 PM   |  Post / Read Comments (0)