According to statistics issued yesterday by the Japanese External Trade Organisation (Jetro) http://www.jetro.go.jp/, the combined per capita income of ASEAN countries Burma, Brunei, Cambodia, India, Indonesia, Laos, Malaysia, Phillipines, Singapore, Thailand and Vietnam for 2007 was USD7,533, against just USD2,459 for China. This represents a rise from USD6,830 for 2006, an extraordinary increase for a diverse total population also larger than China’s at @1.6 billion people against 1.2 billion for the PRC.

This reflects the continuing growth rate and prosperity in the region, with major consequences for FDI throughout Asia. The regions diversity is also displayed, with tiny Brunei and Singapore leading the way in incomes, far beyond their Asian counterparts, over USD32,000 a head. At the opposite end of the scale however, Burma, Cambodia , Laos, Vietnam and India all recorded average per capita income of less than USD1000 per annum, although all showed significant growth rates as well. Of those closest to China’s level of GDP income, Thailand exceeded it and Indonesia was close behind China.

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Numbers: (5456,686)

Singapore-based Changi airports has signed an agreement with Bengal Aerotropolis Projects Ltd. (BAPL) to invest $2.5 billion or Rs 10,000 crore to develop India’s first privately owned airport. The Durgapur Aerotropolis (airport city), India’s first, will be situated in the Durgapur-Asansol region of Bardhaman district in West Bengal an East India state.

The project will involve setting up of a Greenfield Airport, industrial park, logistics hub, IT park with a supporting infrastructure like housing, tourism, healthcare and social interchange facilities. While the airport will be developed over approximately 300 hectares, the supporting industrial and social infrastructure will be developed over approximately 650 hectares. The airport is expected to be functional in next 2.5 - 3 years and would have the ability to handle A-320 aircrafts.

The plan is part of a bigger idea to set up a health city and a sea port in addition to the airport. Last year, West Bengals Chief Minister, Mr Buddhadeb Bhattacharjee, said the Planning Commission was conducting a feasibility study with regard to the setting up of a sea port on the Shanghai model in West Bengal. (more…)

While Vietnam, Cambodia, Burma & Sri Lanka seem to be taking advantage of the opportunities spilling over from India and China, Bangladesh on India’s north east and China’s south west corners seems to be loosing its main export - finished jute products.

 A report by Bangladesh’s Daily star says that Bangladesh is loosing millions in jute exports because it exports the raw material to India and China who process it (mostly into bags (gunny sacks)) and later re-export as value added goods.

“Export price of raw jute is around Tk 13,000 a tonne, but its price becomes Tk 35,000 if it is a finished goods (sacks),” Salim Reza, vice chairman of Bangladesh Jute Exporters’ Association, told The Daily Star.

According to official data, during the July-December period this fiscal (2007-08), Bangladesh exported raw jute worth US$82 million, a 13.18 percent increase from the US$72 million exports during the corresponding period in the last fiscal year.

While Bangladesh’s jute goods export has declined by about US$2 million to US$166 million in the first half (till December) of the current fiscal year compared to the same period of the last fiscal year.

India, China and Pakistan have become major buyers of Bangladeshi raw jute in the recent time, exporters said.

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Numbers: (8.42,8.77)

Both China and India are leading the way forward for global vehicle trends as Tata’s Nano has stunned the US car manufacturing market in it’s simplicity and low cost. The increasing rising of gas prices is having three effects, both of which China and India have long foreseen – the need for smaller cars, a fundamentally different financial production model than the current one used for auto manufacture,  and the trend ultimately to electric powered clean emission vehicles.    

The Reva 

While the US market is not planned for market entry by Tata, many industry experts believe that the way forward will be vehicles of the Nano type. The disposable culture of the US fits that of the cheap USD2,500 Nano – with no need to spend much on repairs or maintenance – you just buy a new one when the need arises. The Nano is already mostly made from recyclable materials – with it’s manufacturer, Tata also owning many recycling plants in India, thus creating an entirely new economic model for vehicle production. This financial model is completely different of anything American, European and Japanese manufacturers have previously considered.

Forecasts for ‘small’ car purchases are set to rocket by 65% in the next four years, and by 50% in Western Europe. Even the conservative US, lovers of big auto statements, are anticipating a growth of 25% in the category.

Auto analyst John Wolkonowicz stated “The Nano is the price of a small laptop computer, and is the 21st century equivalent of the Model T Ford. It is going to mobilize the third world and that will have implications for everyone”.

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A tailor displays fabrics in Beijing’s Cental Business District.

Alarm bells are definitely ringing in boardrooms across China.

Eating into exporters’ profit margins, producer prices jumped 6.1 percent last month to a three-year high.Meanwhile, labour wages last year rose 20 percent and the yuan has appreciated more than nine percent against the US dollar in the past 14 months.

This has meant that more exporters face bankruptcy unless they lift prices to salvage their disappearing margins, which is just what most plan to do.

According to a survey by brokerage and research firm CLSA, 80 percent of Chinese exporters intend to raise prices this year in response to higher raw material costs.
“The appreciation of the renminbi (yuan) against the US dollar is a secondary factor driving these price hikes,” Shanghai-based CLSA economist Andy Rothman said in the survey.

read more here: http://afp.google.com/article/ALeqM5hEgIChMQQp2ctk9tdgiuG7uYkBww

Does this mean that China is finally moving up the value added chain?, will it create more opportunity in the area for Vietnam, Cambodia, Sri Lanka and Burma in the low cost manufacturing space? Or will this erode China’s edge as a low cost manufacturer the world depended on for cheap goods, giving rise to India’s dominance as a quality supplier?

 The Chinese just have too much money! At a time when when world gold grices are at an all time high, China has for the first time usurped the US, as the world’s second largest market for gold jewellry. China is however yet surpassed by India - who still hold the global #1 position, according to the World Gold Council (WGC).

At a time when gold prices are already high (gold prices jumped more than 30 percent last year, the biggest increase since 1979),  WGC statistics showed that sales of gold jewellry in China reached a record high of 302.2 tons in 2007, up 34% from 2006. Conversely, WCG said that in 2007 demand for gold in the U.S. saw a 14 percent year on year drop, while sales in Britain and Italy slumped too.

Interestingly, in January China’s gold futures made a strong debut on the Shanghai Futures Exchange as international gold prices repeatedly hit new highs.

Chinese demand for the metal helped boost its price in London to a record high of $936.50 an ounce in early February.

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Numbers: (4.8,3.1)

For years, every summer young Indians and Chinese fly west to greener pastures in search of a more lucrative job. “India is no place to make money, earn your money abroad, then come back to India to retire,” was the advice I got from the older and wiser.

Now however, it seems the tables are turning, a lack of skilled employees, high attrition rates and a booming realty market means that Indian and Chinese salaries are registering double digit growth, - for 5 consecutive years now. Salaries in corporate India are set to rise at the fastest pace in the world this year. Salaries rose 15.1% last year, one of the highest in the world and the highest in the Asia-Pacific region - the sector doling out the most moolah was Realty, according to human resources consulting firm Hewitt Associates. Of the different strata in a company, junior management and professionals have recieved the highest rise.

Hewitt’s statitics for China show similar double digit growth. China’s highest salary jump was in 2006, when increments rose 7% to 9%in tier one cities such as Beijing, Shanghai and Guangzhou and and by 7.5% to 10.6% in tier two cities - Chengdu, Sichuan, Hangzhou and Zhejiang and Wuhan.

Will the rise in salary lead to India and China’s diminishing competitive advantage? or will it lead to a flood of reverse brain drain?