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Why China
China has a population of more than 1.3 billion with a labor force
of more than 786 million people. Covering an area of 9.6 million
square kilometers, it is the world’s fourth largest country
after Russia, Canada and the USA. The country is divided into 23
provinces, five autonomous regions, four Central Government municipalities,
and two Special Administrative Regions (Hong Kong and Macau).
The country recorded GDP growth of 10.5% year-on-year in 2006 and
from 1996 to 2006 the year-on-year GDP growth was consistently above
7.0%. In 2006, its GDP reached US$2.512 trillion, which was the
second largest in the world after the USA. The RMB (currency of
China) appreciated over 5% in 2006 and is anticipated to see continued
appreciation in the coming five years.
Why GCSL China
GCSL China, through its Shanghai Representative office, offers company
business registration, bank account opening in China and a wide
range of administration, consultancy and strategic planning services
prior to and after the client enters this vast and complex market.
In addition, GCSL via its network of professional contacts in China,
assists in setting up Representative Offices, Wholly Foreign Own
Enterprises and Joint Ventures.
Several features of its legislation and economic environment make
China the jurisdiction for foreign investment. These include:
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More than 2,000 Economic Development
Zones in different classifications and areas open to foreign
Investors. |
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Tax breaks (from 0% to 24%) are
offered to foreign investors investing in these Economic Development
Zones. Local governments offer other incentives to attract foreign
investors. |
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Efficient labor force of more
than 786 million people with approximately half engaged in agriculture
and the balance in manufacturing and services (2005). GDP per
capita is USD1,700. From a purchasing power perspective, GDP
per capita is over USD6,000. |
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Over USD70 billion of foreign
investments have been made in China with more than 50,000 entities
in various industries. |
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Representative Offices are suitable
for representing the foreign parent company. It is the easiest
and least costly method for foreign enterprises to establish
an initial presence in China. It is not allowed to conduct profit
making activities, whereas non-profit making activities are
permissible, such as liaison with clients, market research,
quality control, technology exchange, marketing and sales administration. |
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Wholly Foreign Own Enterprises
are the most popular choice for foreign companies doing business
in China in international trading, manufacturing, processing,
assembling and other “profit making” activities.
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A joint venture is a legal entity
in China which is usually formed by two or more foreign investor(s)
and local investor(s) under equity or cooperative arrangements.
The main difference between Equity Joint Ventures and Cooperative
Joint Ventures is that Cooperative Joint Ventures have greater
flexibility in the allocation of profits. Joint ventures may
be more suitable for business activities deemed “limited”
or “prohibited” by the authorities in China. |
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As a member of The GCSL Group
of Companies, GCSL China is ideally
positioned to provide clients with a truly global network of
services in a cost-effective, efficient and professional manner.
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Click for the Guide
to Investment Structures for China
Guide to Formation
of a Representative Office (RO) in China
Guide to Formation
of a Wholly Foreign Owned Enterprise (WFOE) in China
For further information please contact
our Shanghai office at
china@gcsl.info
We are here to CONSULT and SERVE YOU.
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