Economy

The 2nd Largest VC Destination in the World

China has become the worlds 2nd largest destination for venture capital （VC） after the U.S.， according to Lin Nianxiu， deputy head of the National Development and Reform Commission （NDRC）， commenting at a press briefing in late April.

VC and angel investment are growing rapidly， Lin said， claiming there were nearly 3，000 funds managing more than RMB 1 trillion （around US $150 billion） in China by the end of 2015.

Chinese start-ups have become a new favorite for investors， Lin said. The number of new firms has continued to increase at a relatively fast pace in Q1， when about one million companies were registered， up 25.9 percent from a year ago. The tertiary sector grew 7.6 percent year on year in Q1， outpacing a 6.7-percent GDP increase over the same period.

China needs to develop the “twin engines” of popular entrepreneurship and mass innovation， alongside increased supplies of public goods and services to drive development， Premier Li Keqiang said in the 2015 government work report.

On March 11， 2016 the State Council issued a decree to encourage mass entrepreneurship and innovation. It vowed to provide a better environment for popular entrepreneurship and mass innovation by lowering thresholds， strengthening public services and encouraging college students and scientists to start new businesses. China will also pilot equity-based online crowdfunding and encourage banking and financial institutions to provide loans as financing channels to support small and medium-sized tech companies.

“Internet Plus Distribution”Promotes Rural E-commerce

The State Council issued last April a decree to implement the “Internet Plus Distribution” action plan， which urges innovative development of distribution and measures to advance e-commerce development in rural areas.

Statistics show that online purchases in rural areas rose 96 percent year on year to RMB 353 billion in 2015. However， the development of rural e-commerce in China has been curbed due to high distribution costs and low efficiency.

The government is mapping out plans to use the Internet to lower logistics and distribution costs and promote e-commerce in rural areas， said Wang Bingnan， assistant minister of commerce. He added that efforts would be made to increase investments in the construction of rural broadband networks and support companies building cold chain systems for the distribution of agricultural products.

Wang pointed out that Chinas rural ecommerce is generally in good momentum， but still has some problems.To tackle these problems， the decree stipulated that efforts would be made to promote online sales of farm products and to encourage e-commerce companies to expand their rural networks.

Premier Li Keqiang has emphasized on various occasions that efforts should be made to boost rural e-commerce. He said in this years government work report that the government encourages more investment in agricultural modernization and the introduction of e-commerce into rural areas， and would take targeted measures to alleviate and eliminate poverty in light of local conditions.

E-commerce giants like Alibaba Group and JD.com have made overall arrangements in rural areas. JD has launched a series of initiatives in poverty-stricken areas of Guizhou Province to help the sales of local agricultural products. Its efforts are expected to help create job opportunities， improve quality of life， and help local enterprises achieve their transformation and upgrading.

ICBC Launches Its First U.S. Credit Card

On April 26， 2016 the Industrial and Commercial Bank of China （ICBC） partnered with UnionPay International to launch its first U.S. credit card in New York. It is both the first UnionPay credit card issued in the U.S. market and the first credit card issued by a Chinese commercial bank in the U.S.

The jointly issued credit card aims to deliver a secure and convenient mode of payment for American residents who often travel between China and other Asia-Pacific countries， and overseas Chinese in the U.S. It is based on the UnionPay card acceptance network that covers 157 countries and regions， as well as the international financial service platform of ICBC.

So far， UnionPay International has worked with ICBC to issue cards in more than 20 countries and regions such as Canada， New Zealand， and Singapore.

Over 54 million UnionPay cards have been issued in overseas markets. The service system of UnionPay cards has been continuously improved in the U.S. Currently， UnionPay cards can be used to withdraw cash from almost all local ATMs. The jointly issued credit card will offer new payment choices for local residents in the U.S.， and attract more U.S. customers to travel to China， thus boosting bilateral exchanges.

Chinas Job Market Remains Stable

Chinas registered unemployment rate in urban areas stood at 4.04 percent at the end of Q1， down from 4.05 percent at the end of 2015， said Li Zhong， spokesman for the Ministry of Human Resources and Social Security， at the end of April.

An additional 3.18 million urban jobs were created in the first three months of 2016， said Li.

“The data indicate that Chinas job market remains stable，” Li said， attributing the job increase and low unemployment rate mainly to “slower but reasonable economic growth， the governments deepened reform and innovation drive， as well as pro-employment policies.”

Chinas economy continued to slow in Q1 of 2016， with the GDP growing 6.7 percent year on year to reach RMB 15.85 trillion （about US $2.4 trillion）. The figure was in line with market expectations and remained within the governments targeted range of between 6.5 and 7 percent for 2016.

“As the national economy is under increasing downward pressure and structural reform is deepening， the employment situation is a hardearned result，” commented Li Changan， a professor with the University of International Business and Economics.

China aims to provide more than 10 million new urban jobs in 2016 and keep the registered urban unemployment rate below 4.5 percent， Premier Li Keqiang said in March.