month in review • BRIEFING MONTHINREVIEW
800,000: The number of expats projected to live in Shanghai in 2021
ALSO IN THIS SECTION
SECTOR NEWS, P8 EU levies anti- dumping tariffs; Santander and CCB take trip to countryside
CHINA BY NUMBERS, P8 CHINA BUZZ, P9 FAT DRAGON, P10
PAUL FRENCH’S DIARY, P11 IKEA caters to Chinese brats
QUESTION OF THE MONTH, P12
How to contain PPI inflation? LOCAL VOICES, P14
COMPANIES, P16 Media Markt can outsell Best Buy PORTFOLIO, P18 China Mass Media, SkyPeople QUESTION & ANSWER, P20 Former Prime Minister of Italy Romano Prodi
BRIEFING Aftershock
The media blitz has subsided, but the Japanese earthquake is just beginning to take its toll on Chinese businesses
O
n March 11, an earthquake and the ensuing tsunami devastated commu- nities along Japan’s east coast. Damage
to transport networks and power plants created logistic hurdles and energy shortages that crip- pled producers in other parts of the country. Te disasters knocked links out of many
global supply chains, with mixed effects on Chinese industries. Japan is one of China’s biggest trading partners, accounting for 8% of exports and 13% of its imports in 2010 – both of which are likely to slump as Japan grapples with the initial effects of the crisis. Industries in China that source parts from
Japan, like consumer electronics and automo- bile makers, may have only recently begun to feel the pinch. Most analysts estimate manu-
facturers had weeks or even months of inven- tory when Japanese suppliers ground to a halt. Toyota, Nissan and Honda said in early
April that their China assembly lines were op- erating normally. However, the companies have all shuttered plants in quake-affected areas that supply engines, transmissions and other parts to carmakers in China, including their joint ventures with major China automakers: Dong- feng Motor for Honda and Nissan, and FAW Xiali Automobile for Toyota. Some of their production lines may lurch
in coming months. However, Dongfeng Mo- tor and FAW Xiali are big companies with vast supplier networks, so the crisis should have lit- tle impact on their earnings, said Ben Lake, an analyst at research firm Pacific Epoch.
China Economic Review • May 2011 7
Imaginechina
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