China – Michmutters
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Business

Mattress company Koala cuts 30 Australian jobs over economic uncertainty

Popular Aussie bedding and homewares company, Koala, has laid off 30 local staff due to unstable economic conditions.

The company shot up in popularity, particularly during the 2020 and 2021 lockdown periods, due to its competitive pricing, being all online and offering four hour delivery to metro areas.

However, just like many other companies, supply chain issues, inflation and surging interest rates have all taken their toll.

A Koala spokeswoman told The Sydney Morning Herald and The Age that uncertain economic conditions had resulted in 30 Australian staff members being made redundant last week.

Describing the former staff as “amazingly talented”, she said the company was supporting them with an outplacement service and professional connections.

According to the company’s website, Koala has “more than 200” employees.

The company also confirmed it had consolidated its offices in the inner-city Sydney suburb of Alexandria after previously also having employees located in the CBD.

News.com.au has contacted Koala for comment.

But it isn’t just the Australian staff that have been impacted, with 10 roles also being made redundant in South Korea following an expansion to the region last year.

The spokeswoman again told the publications “economic uncertainty” was behind the move, along with the need to “reduce our start-up cost in the market”.

“For the near term, our operations in Korea continue as we explore more efficient ways to serve the market,” she said.

The Sydney Morning Herald and The Age also cited claims from multiple industry sources that Koala had explored the possibility of listing on the Australian stockmarket, before abandoning the plan amid the recent the recent technology downturn.

The spokeswoman for the company strongly denied these claims.

“Like any private company with proven success as a market leader in our categories and markets, we are fortunate enough to receive countless inbound introductions from potential investors,” she said.

“They see the opportunity for Koala to continue to disrupt the global furniture market.”

She did not offer specific figures, but said Koala’s margins were double those of some of its competitors, adding that the decision to offer furniture and other homewares has led to “incredible growth” in non-mattress sales.

“We will continue to invest in our operations across Australia and Asia,” the spokeswoman said.

In October 2020, Koala copped significant backlash after announcing it would cease manufacturing its mattresses domestically and make them in China instead.

Staunch supporter of Australian-made products, Harvey Norman executive chairman Gerry Harvey, previously slammed Koala’s move, saying the name of the company implies the product is made domestically.

“Anyone selling imported mattresses are doing it because they can make more money,” Mr Harvey said.

“The marketing is dishonest… they are pretending they are Australian.”

The retail giant’s co-founder said overseas imports made it harder for local companies to compete in bedding and furniture.

Mr Harvey said his store predominantly sold made-in-Australia bedding, supporting local companies such as Sealy, SleepMaker and AH Beard.

When it was established in 2015, Koala marketed itself as a retailer of Australian-made furniture with a strong focus on sustainability.

However, most of its manufacturing has now moved to China and Europe, with the company deregistering itself in 2019 from using the Australian Made trademark.

“The decision to cease production of mattresses in Australia will provide significant innovation and quality improvements to help drive our continued growth across Asia-Pacific,” a company spokeswoman said at the time.

Koala said the move offshore would mean it would have greater influence in cultivating “sustainable behaviours” in its manufacturing and supply chain.

“We are always in search of the best manufacturers, suppliers, and makers around the world who meet or exceed our environmental and sustainability standards and conduct assessments to support this,” a spokeswoman said.

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Categories
Australia

Richard Marles reaffirms Australia’s commitment to the one-China policy and ‘stabilising’ Canberra-Beijing relations

Richards Marles has reaffirmed Australia’s commitment to the one-China policy as Canberra moves towards “stabilizing” its relationship with Beijing.

Speaking with Sky News Australia’s Kieran Gilbert on Sunday, the Defense Minister and acting Prime Minister said Australia’s main motive was to see a “de-escalation of tensions” in the region.

“What we want to see is a return to normal peaceful behavior which underpins that, from Australia’s point of view, is not wanting to see any unilateral change to the status quo across the Taiwan Strait,” he said.

“That means we have a one-China policy that’s been the status quo in Australian policy, and indeed for the United States and other countries, for a very long period of time.”

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Under Australia’s version of the one-China policy Taiwan is acknowledged as a province of China and is not recognized as its own country, however, the policy allows for unofficial contact including visits from MPs on parliamentary delegations.

Mr Marles said he did not believe Australia’s stance on Taiwan would hinder the repair of bilateral relations between Canberra and Beijing but said he wanted to see the relationship in a “better place”.

“We talk about a stabilizing in the relationship and in doing that we acknowledge there are going to be challenges in the relationship with China,” he said.

“What we have sought to do is really change the tone in the way in which we are engaging with the world but that includes the way in which we engage with China.

“We’re not going about things with chest beating we are really trying to speak with a considered voice in a manner which is professional, which is sober, and which is diplomatic.”

Beijing ended diplomatic communications with Canberra in January 2020 and slapped sanctions on barley, beef, wine and other goods after then-prime minister Scott Morrison called for an inquiry into the emergence of COVID-19.

He said the Albanese government’s approach would be “professional” and “respectful” in its approach without compromising Australia’s national interest.

“We want to engage professionally and respectfully but we will absolutely be articulating our national interest,” he said.

“There are going to be challenges going forward at the same time we acknowledge they’re our largest trading partner and we value a productive relationship with China.

“We do want to see our relationship in a better place but we’ll continue to articulate our national interest and we’ll see how far down this road we can walk.”

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Categories
Australia

Peter Dutton ‘very strongly supports’ Richard Marles’ language used about nuclear submarines as he warns of Taiwan invasion

Opposition Leader Peter Dutton has stressed the importance of acquiring nuclear-powered submarines as soon as possible after the Chinese Ambassador to Australia delivered his first National Press Club speech this week.

Xiao Qian – who became Beijing’s top diplomat in Canberra this year – had defended China’s actions when it responded with live military drills in Taiwan following the historic visit from United States House Speaker Nancy Pelosi last week.

He warned Australia to handle the messaging around Taiwan “with caution” and added there was “no room for compromise” as China sees the island as its own territory.

Mr Xiao also threatened Beijing would take Taipei with force and would be “ready to use all necessary measures” to restore the liberal democracy “to the motherland”.

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Mr Dutton said he was not “shocked” by the remarks from the ambassador as the messaging was similar to what was delivered by Chinese President Xi Jinping.

But he agreed it was alarming to hear the comments being made on Australian shores before he flagged it would be no “surprise” if China invaded the island.

“I don’t think anyone would be surprised if there was an incursion into Taiwan,” he told ABC’s 7:30 on Thursday.

The Opposition Leader then stressed the importance of having a “deterrence in place”, in the form of nuclear submarines, to ward off a potential future attack.

“China is clear that their center of humiliation doesn’t come to an end until there is a re-unification, in their words, so it is important for us to have deterrence in place because any adversary should know that a strike on Australia would ‘t be accepted,” he said.

“And there would be retaliation and also weed need to be close and fight with our allies, not just America, but India and Japan.”

While Australia’s national security would be secure under the AUKUS alliance with the US and United Kingdom for the next five to six decades, he warned the nation needed nuclear-powered submarines to plug the capability gap.

He also came to the support of Defense Minister Richard Marles who insisted this week it is the government’s “top priority” to fill the gap left by the Collins fleet of boats.

“Yes, I very strongly support Richard Marles,” he said.

“He is adopting similar language that I used not too long ago to say if we can get those submarines off the production line, then we should certainly strongly believe that that is possible and that’s the course of action that the government should be pursuing. “

Mr Dutton also welcomed the response from Mr Marles, Foreign Minister Penny Wong and Prime Minister Anthony Albanese who have all called for a de-escalation of tensions in the Taiwan region but believes the messaging can be stronger.

“I believe very strongly that we are better to speak frankly about China’s intent – they’re clear about it themselves, as we have discussed, and it is important for Australians to hear that message,” he said.

Mr Marles is set to make a decision by March 2023 on whether Australia will go with acquiring eight US Virginia-class or British Astute-class built submarines.

The government is expected to decide then whether Australia will need interim, conventionally powered submarines before the AUKUS vessels are ready to hit the water, which may not be for another 20 years around the 2040s.

Mr Marles said this week he would like to see the new boats constructed in Australia as part of a beefing up of its domestic defense manufacturing ability.

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Categories
Australia

China labeled Australia’s biggest national security threat on Q+A as tough talk on Taiwan draws passionate response

The Chinese Communist Party (CCP) has been labeled the biggest threat to Australia’s national security on Q+A, with panellists from both the government and opposition sharing their concerns about China’s actions in the Taiwan Strait and subsequent comments by the Chinese ambassador to Australia.

In the past week, China has conducted military drills in the Taiwan Strait, repeatedly crossing its median line by air and sea and launching missiles that went over Taiwan and landed in Japan’s exclusive economic zone (EEZ).

Those actions came after the Speaker of the US House of Representatives, Nancy Pelosi, visited Taiwan, which China claims to be a state within its territory.

On Thursday night, Q+A audience member Li Shee Shu suggested to the panel that China should not be seen as Australia’s greatest threat.

Liberal Senator James Paterson pounced.

“The reason why the Chinese Communist Party is labeled as the biggest national security threat to Australia is because they are,” Senator Paterson said.

“Right now, today, we are under a near-constant attack in the cyber realm from the Chinese Communist Party, whether it is the government or our critical infrastructure.

“Over the past five years, we have suffered record levels of foreign interference and espionage and the Chinese government is the primary culprit of that.

“Right now, the Chinese government is acquiring military capability at the fastest pace of any nation in the world since World War II and, I think, the evidence shows they’re not just doing that for the fun of it.

“They have reclaimed islands in the South China Sea, illegally, although Xi Jinping promised that he wouldn’t.

“They have just fired ballistic missiles over Taiwan into Japan’s EEZ. If we are not going to take this threat very seriously, we are going to regret it.”

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His comments were echoed by Minister for International Development and the Pacific Pat Conroy, who took a softer stance but said China’s actions in recent times were a cause for concern.

“The Australian government’s position is that we support no unilateral change to the status quo,” Mr Conroy said.

“As a middle power, it’s in Australia’s interest to pursue a rules-based order where every nation observes and follows international laws and normals,” he said.

“And to James’s point, illegal island-building in the East and South China Seas challenges that rules-based order.”

CCP has repeatedly shown us who they are, Paterson says

Mr Conroy, who earlier called for a de-escalation of tensions in the Asia-Pacific region, said he was concerned by the Chinese ambassador’s comments about Taiwan on Wednesday.

The ambassador, Xiao Qian, stressed at the National Press Club that there was “no room for compromise” on Taiwan and China would use “all necessary means” for reunification with the island.

“In the interests of everyone in the region, de-escalation needs to occur now,” Mr Conroy said.

“We need restraint and we need to focus on a peaceful and prosperous region.

“I was concerned, like many people, by some of the language used by the ambassador [on Wednesday]but we just have to move past it.”

However, for Senator Paterson, those comments seemed to be folly.

He indicated he did not believe China’s actions in the past week were simply muscle flexing ahead of the CCP’s 20th annual party congress, but rather part of a long-established pattern.

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“The late American poet Maya Angelou had a wonderful phrase that when people show you who they are, believe them the first time,” he said.

“The Chinese Communist Party has not just shown us once who they are, they’ve shown us who they are in Tibet, they’ve shown us who they are in Xinjiang, they’ve shown us who they are with Hong Kong and they are showing us again who they are with Taiwan.

“And the ambassador at the Press Club yesterday showed us who they are and we should believe him.

“They are very serious when they say all options are on the table and that we should use our imagination to think about what they might do.

“And we should believe them when they say that re-education of the 23 million free people of Taiwan is something that they have planned for, after taking Taiwan, and we should treat that very seriously.”

Chinese Australian population stigmatized

Q+A audience member, teenager Jun Gao, said raised concerns about how Beijing’s actions were affecting the treatment of Chinese Australians.

He said he and others had faced discrimination during the pandemic and it was happening again now due to rising tensions with China.

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“I’ve felt the effects of the tumultuous COVID-19 pandemic and now rising tensions within the South China Sea,” he said.

“What can be done to destigmatize the Chinese Australian population?”

“In general, I feel there is about negative perception, both in the schoolyard and [the] media, and I fear that Chinese recent political actions will only compound this,” Gao added.

Panel member and Lowy Institute research fellow Jennifer Hsu said studies had seen a rise in that sentiment.

“We found in this year’s survey that generally Chinese Australians feel a sense of belonging, although that has decreased since 2020,” Ms Hsu said.

“[There is] a general sense of belonging, pride in Australian life and culture — and I think these are all positive indicators of, you know, Chinese-Australians’ contribution and integration into Australian society … but, yes, I would agree with you that, over the last two years… the sense of fragmentation has happened, in part due to discrimination and racism.

“But I would say there [are] potential positive points to look forward to, with a new government in power. there [are] signs of thawing [relations] between Australia and China.”

Senator Paterson condemned the discrimination Gao’s had faced and called for Australians to understand the difference between a political stoush with the CCP and anything to do with Australians of Chinese heritage.

“Thank you for raising this issue, you are absolutely right to,” he told Gao.

“It is both morally wrong and counterproductive for Chinese Australians to be held guilty for the actions of the Chinese government.

“It is also wrong to hold the Chinese people guilty for the actions of the Chinese government because they had no say in picking that government, there was no vote that brought the Chinese Communist Party to power.

“It is morally wrong because it is not your fault and it is counterproductive because we want Chinese Australians to feel just as much a part of the Australian community as everyone else and to be able to fully participate in that community.”

Watch the full episode of Q+A on ABC iview

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Categories
Business

Evergrande investor Lin Ho Man takes collapsing company to court over $158m debt

A young millennial is threatening the existence of a multi-billion dollar Chinese property developer.

In 2021, real estate heavyweight Evergrande earned the unwelcome title of the world’s most indebted real estate firm after racking up staggering debts of around $A408 billion.

Evergrande’s share price tanked and the firm missed a string of payment deadlines, which eventually saw it officially declared in default for the first time in December.

And now a young 30-year-old investor — who Bloomberg reported is “politically connected” — is taking the conglomerate on in the High Court of Hong Kong.

Lin Ho Man claims Evergrande owes him HK$862.5 million ($158 million) because of money he invested through his business.

He has applied for a winding up order, calling for the company to be wound up unless they cough up the funds to pay him back.

In order for Evergrande’s shares to be able to trade, Mr Lin’s lawsuit has to be resolved, either by being mediated to lead to dismissal, or for him to withdraw the case.

Although Evergrande has been in hot water with creditors and customers in recent months, nobody has reportedly gone as far as demanding the company be liquidated.

Mr Lin runs a fintech company called Top ShineGlobal which invested millions for a 0.46 per cent stake in Fangchebao, Evergrande’s automobile and real estate arm in March 2021.

Then Triumph Roc International, another one of Lin’s investment holding companies which he acted as guarantor for, invested the same amount for a separate 0.46 per cent stake.

Just a few months later, the extent of Evergrande’s financial woes became well-known.

Evergrande said it will oppose the legal case “vigorously” and added that this shouldn’t impact the company’s restructuring plans or timetable.

Mr Lin’s case has already had a preliminary hearing earlier in August and the next court session is happening later this month.

Evergrande, one of China’s biggest developers, has scrambled to offload assets in recent months, with chairman Hui Ka Yan paying off some of its debts using his personal wealth.

Its troubles are emblematic of the problems rippling across China’s massive property sector, with smaller companies also defaulting on loans and others struggling to raise cash.

Chinese creditors have sued Evergrande for more than $US13 billion in allegedly overdue payments, the Financial Times reports.

According to documents seen by the publication, a Chinese court has accepted a whopping 367 cases against Evergrande.

Insiders claiming it is one of the biggest indicators yet that local creditors have lost confidence in the firm’s ability to handle the ongoing crisis.

Shares in the company have been halted since March.

— With Alexis Carey

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Categories
US

China appears to wind down threatening wargames near Taiwan

BEIJING (AP) — China on Wednesday repeated military threats against Taiwan while appearing to wind down wargames near the self-governing island it claims as its own territory that have raised tensions between the two sides to their highest level in years.

The message in a lengthy policy statement issued by the Cabinet’s Taiwan Affairs Office and its news department followed almost a week of missile firings and incursions into Taiwanese waters and airspace by Chinese warships and air force plans.

The actions disrupted flights and shipping in a region crucial to global supply chains, prompting strong condemnation from the US, Japan and others.

An English-language version of the Chinese statement said Beijing would “work with the greatest sincerity and exert our utmost efforts to achieve peaceful reunification.”

“But we will not renounce the use of force, and we reserve the option of taking all necessary measures. This is to guard against external interference and all separatist activities,” it said.

“We will always be ready to respond with the use of force or other necessary means to interference by external forces or radical action by separatist elements. Our ultimate goal is to ensure the prospects of China’s peaceful reunification and advance this process,” it said.

China says its threatening moves were prompted by a visit to Taiwan last week by US House Speaker Nancy Pelosi, but Taiwan says such visits are routine and that China used her trip merely as a pretext to up its threats.

In an additional response to Pelosi’s visit, China said it was cutting off dialogue on issues from maritime security to climate change with the US, Taiwan’s chief military and political backer.

Taiwan’s foreign minister warned Tuesday that the Chinese military drills reflect ambitions to control large swaths of the western Pacific, while Taipei conducted its own exercises to underscore its readiness to defend itself.

Beijing’s strategy would include controlling the East and South China seas via the Taiwan Strait and imposing a blockade to prevent the US and its allies from aiding Taiwan in the event of an attack, Joseph Wu told a news conference in Taipei.

Beijing extended the ongoing exercises without announcing when they would end, although they appeared to have run their course for the time being.

China’s Defense Ministry and its Eastern Theater Command both issued statements saying the exercises had achieved their targets of sending a warning to those favoring Taiwan’s formal independence and their foreign backers.

Taiwan President Tsai Ing-wen and her Democratic Progressive Party administration are “pushing Taiwan into the abyss of disaster and sooner or later will be nailed to the pillar of historical shame!” Defense Ministry spokesperson Col. Tan Kefei was quoted as saying in a statement on the ministry’s website.

Troops taking part in the exercises had “effectively tested integrated joint combat capabilities,” the Eastern Theater Command said on its Twitter-like Weixin microblog.

“The theater troops will monitor changes in the situation in the Taiwan Strait, continue to conduct military training and preparations, organize regular combat readiness patrols in the Taiwan Strait, and resolutely defend national sovereignty and territorial integrity,” spokesperson Col. Shi Yi was quoted as saying.

Taiwan split with the mainland amid civil war in 1949, and its 23 million people overwhelmingly oppose political unification with China while preferring to maintain close economic links and de facto independence.

Through its maneuvers, China has pushed closer to Taiwan’s borders and may be seeking to establish a new normal in which it could eventually control access to the island’s ports and airspace.

Along with lobbing missiles into the Taiwan Straitthe nearly week-long drills saw Chinese ships and planes crossing the center line in the strait that has long been seen as a buffer against outright conflict.

The US, Taipei’s main backer, has also shown itself to be willing to face down China’s threats. Washington has no formal diplomatic ties with Taiwan in deference to Beijing, but is legally bound to ensure the island can defend itself and to treat all threats against it as matters of grave concern.

That leaves open the question of whether Washington would dispatch forces if China attacked Taiwan. US President Joe Biden has said repeatedly the US is bound to do so — but staff members have quickly walked back those comments.

Beyond the geopolitical risks, an extended crisis in the Taiwan Strait — a significant thoroughfare for global trade — could have major implications for international supply chains at a time when the world is already facing disruptions and uncertainty in the wake of the coronavirus pandemic and the war in Ukraine.

In particular, Taiwan is a crucial provider of computer chips for the global economy, including China’s high-tech sector.

In response to the drills, Taiwan has put its forces on alert, but has so far refrained from taking active countermeasures.

On Tuesday, its military held live-fire artillery drills in Pingtung County on its southeastern coast.

Australia’s recent change of government is a chance to “reset” its troubled relationship with China, but the new administration must “handle the Taiwan question with caution,” a Chinese shipment said Wednesday.

China has brushed aside foreign criticism of its actions, and its ambassador to Australia said he was “surprised” that Australia had signed a statement with the United States and Japan that condemned China’s firing of missiles into Japanese waters in response to Pelosi’s visit.

Xiao Qian told the National Press Club that China wanted to resolve the situation peacefully, but “we can never rule out the option to use other means.”

“So when necessary, when compelled, we are ready to use all necessary means,” Xiao said. “As to what does it mean by ‘all necessary means?’ You can use your imagination.”

In London, the British government summoned Chinese Ambassador Zheng Zeguang to the Foreign Office on Wednesday to demand an explanation of ”Beijing’s aggressive and wide-ranging escalation against Taiwan” following Pelosi’s visit.

“We have seen increasingly aggressive behavior and rhetoric from Beijing in recent months, which threaten peace and stability in the region,” said Foreign Secretary Liz Truss. “The United Kingdom urges China to resolve any differences by peaceful means, without the threat or use of force or coercion.”

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Associated Press writer Jill Lawless in London contributed to this report.

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Categories
US

China’s trade curbs on Taiwan after Pelosi visit are drop in the ocean

Beijing’s new trade blocks against Taiwan affect about 0.04% of their two-way trade, making them more political than economic.

Beijing took action against Taiwan following US House Speaker Nancy Pelosi’s visit to the island earlier this month despite warnings from Beijing. That included suspensions of imports of Taiwanese citrus, frozen fish, sweets and biscuits and exports of natural sands to Taiwan.

Taiwan is a self-ruled democracy, but Beijing considers the island part of its territory and a breakaway province. China says Taiwan has no right to conduct foreign relations and warned for weeks against Pelosi’s visit.

What trade numbers show

US House Speaker Nancy Pelosi with Taiwan’s President Tsai Ing-wen, after arriving at the president’s office on August 3, 2022, in Taipei, Taiwan. Pelosi’s visit infuriated China, which regards the self-ruled island as its own and responded with test launches of ballistic missiles over Taipei for the first time, as well as ditching some lines of dialogue with Washington.

Handout | Getty ImagesNews | Getty Images

When it comes to Taiwan’s imports from mainland China, more than half of the $82 billion traded in 2021 were electrical machinery, electronic and technological parts as well as nuclear reactors and boilers.

As for Taiwan’s exports to China, 65% of them were also similar goods in electrical machinery, electronic and technological parts.

Drop in the ocean

On the other hand, the volume of trade in areas that Beijing has targeted is relatively small.

Exports of natural sand to Taiwan — which Beijing has targeted — were a drop in the ocean against the above figures. They amounted to about $3.5 million last year, data from the Taiwanese trade bureau showed.

They were also a small trade compared with natural sand exports from Australia and Vietnam, the biggest suppliers of natural sand to Taiwan last year. Together, they supplied about $64 million of the raw material used in construction and other industries, making up 70% of Taiwan’s purchases, according to its trade bureau.

Similarly, the targeted trade of citrus was valued at a relatively small $10 million last year, though mainland China was also Taiwan’s biggest citrus buyer, Taiwan’s trade data showed.

The agricultural products now in the headlines are only a fraction of Taiwan’s export basket. And so the headline impact on Taiwan won’t really be noticeable.

Nick Brown

Economist Intelligence Unit

Other targets such as Taiwan’s exports of bread, pastry, cakes and biscuits to mainland China were worth more than $50 million in total last year.

Beijing’s specific suspension of two kinds of frozen fishes, horse mackerel and largehead hairtail, were valued at over $3 million in 2021, according to Taiwan’s trade bureau.

“China’s economic retaliation against Taiwan is a long-standing strategy in its diplomatic playbook. That said, its decision to target relatively low-value trade items reflects the limits of its economic pressure toolbox,” said global trade lead analyst at the Economist Intelligence Unit , Nick Marro.

“It’s already had restrictions on Chinese visitors to Taiwan in place for a few years, which carry more economic significance; the agricultural products now in the headlines are only a fraction of Taiwan’s export basket. And so the headline impact on Taiwan won’t really be noticeable.”

Precedents

Beijing’s trade suspensions against Taiwan are not a new phenomenon.

In previous years, tensions between the two have led to bans on mainland travelers to Taiwan.

Last year, China suspended imports of Taiwanese pineapples, citing quarantine measures over “harmful creatures” that came with the fruit. China was Taiwan’s biggest pineapple buyer up to that point.

Investment bank Natixis said that the recent Chinese trade restrictions focused on “highly replaceable food products” but not the information and communications technology sector in which the two trading partners have the most trade.

The bank also said mainland China will continue to import from Taiwan as long as it needs the goods, similar to what it has done in other trade conflicts such as the one it has with Australia and the United States.

In the China-Australia trade dispute that started in 2020, China restricted the purchase of some goods such as barley and coal but continued to buy iron ore from Australia, a key ingredient for China’s steel production and the bedrock of the countries’ trade.

There may also be other fallouts from the Pelosi visit that could hurt wider regional trade. For example, heightened military drills in the Taiwan Strait may delay shipments, analysts say.

“The shutting down of these transport routes — even temporarily — has consequences not only for Taiwan, but also trade flows tied to Japan and South Korea,” Marro said.

“It’s not just a story for Taiwan and China, but also for their neighbors, as well.”

Analysis by logistics platform Container xChange said any rerouting of shipping lines to avoid military exercises may be problematic for the trading world as it enters peak shipping season.

Container xChange Chief Executive Christian Roeloffs said, however, that supply chains have become far more resilient over the course of the pandemic.

Customer feedback shows any rerouting of vessels away from the Taiwan Strait will add a few days to ship voyages, though Roeloffs does not anticipate a massive hit to logistics costs.

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Categories
Business

Penfolds, Treasury Wine Estates wins copycat Chinese court case against Rush Rich

An Australian wine company has won a “landmark” court case in China after more than six years of fighting a copycat brand.

Treasury Wine Estates owns and produces a number of well-known wine labels including Penfolds and Wolf Blass. However, the issue arose when company Rush Rich used part of the Penfolds branding on its own bottles.

After six years of fighting, on Wednesday, the Supreme People’s Court of China ruled in Treasury’s favor, finding that the other wine company had acted in “bad faith” against them.

The court found that Chinese-Australian company Rush Rich improperly used a Chinese character which was a copyright breach of the Penfolds brand.

This was “illicit conduct”, according to the court.

Treasury Wine Estates said the other company had tried to “exploit” its brand and was happy about the decision from the Chinese court, calling it a “landmark win”.

The court ruled that Rush Rich’s registration of the Chinese character mark for Penfolds Winery was invalid.

“We welcome the Judgment by the Supreme People’s Court of China and thank the Chinese authorities for their continued support in protecting the rights of luxury brand owners,” Penfolds managing director Tom King said.

Following its “longstanding battle” with Rush Rich, Treasury said it takes a “zero tolerance approach” to copyright breaches.

Anna Olsen, global director of intellectual property for Treasury Wine Estates, said in a statement: “Protecting the integrity of our historic brands against trademark piracy and misappropriation has always been a global priority.

“We’ll spare no effort to protect our brands and will pursue our rights to the highest courts where necessary.

“This case shows we won’t tolerate attempts to exploit and infringe the intellectual property rights and reputation of brands in the Treasury Wine Estates portfolio.”

Government regulator Wine Australia was also happy with the court case outcome as it has been working hard to maintain the international reputation of Australian wine.

The case is timely as Penfolds is looking to launch its wine in China.

In 2019, Rush Rich was also slammed with a massive fine in Australia’s Federal Court after being found to have infringed on several trademarks of Treasury Wine Estates.

The company had to pay $375,000 in compensation and was barred from using the images again.

Before the Australian Federal Court case, Treasury Wine Estates took Rush Rich to the Shanghai Pudong Court.

That court also ruled in favor of Treasury Wine Estates and ordered Rush Rich to pay back 2,000,000 Chinese yuan ($A426,000 at the time).

Read related topics:China

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Categories
Business

How David Jones is targeting 582m Chinese customers via WeChat

Upmarket legacy retailer David Jones is arguably better known for its old-fashioned shops and traditional customer service than its online innovation.

But the department store appears to be one of the only Australian retailers tapping into the gigantic Chinese market on a social media platform that boasts 582 million active users a month.

The retailer’s chief marketing officer James Holloman has described the platform Weibo or WeChat as “world leading” combining the elements from other social media platforms like TikTok, Instagram and WhatsApp, as well as the ability to pay bills and buy everything from fashion to beauty products .

With more than 40,000 followers and three years on WeChat, Mr Holloman said David Jones’ Chinese clients were “incredibly important” to the retailer, which has signaled unrivaled “commercial success” on the social media platform.

“WeChat is a full ecosystem for mainland China … and it’s almost a one-stop shop for mainland Chinese where they are doing kinda like Facebook, Instagram and a payment wallet all in one,” he told news.com.au.

“You technically follow different accounts and different individuals, and you use it essentially as a WhatsApp version between your friends in terms of messaging, but then you also follow different brands and it’s similar to a really immersive email.

“It’s basically a full immersive ability to shop directly from incredibly immersive posts … and you can follow everyone from Louis Vuitton, Coca Cola, Estee Lauder to Dior.”

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For David Jones, many of his followers are part of the Chinese community living in Australia and the bulk are aged between 25 and 36, Mr Holloman revealed, which has given the retailer “massive growth” from younger shoppers.

One of the department store’s big moves has been around Singles Day, an unofficial holiday and shopping event held on 11 November every year in China, that celebrates people who are not in relationships.

“Last year during the Singles Day shopping event, which is almost the biggest shopping day worldwide and it’s bigger than Black Friday, we did our first live stream,” Mr Holloman said.

“It’s the equivalent of shopping television where we had an hour and a half of fully engaged viewers watching our life stream of all of amazing products and key specials happening over that day and we had 13,000 viewers watching that on WeChat.”

For the Lunar Year in February, they introduced the little red packets which are a traditional gift of money, and allowed people to send them virtually to friends from their account.

Influencers have also been key to the brand’s success, I added.

Mr Holloman said mainland Chinese are important clients for buying premium goods, with a report from consulting firm McKinsey revealing that 50 per cent of the global luxury goods will be purchased by the Chinese by 2025.

“It’s a very hot market for the stuff that we sell,” he added.

“Secondly, there is an audience in Australia that want to be communicated to. There are 1.2 million Chinese born Australians so that’s a huge proportion as it’s almost 5 per cent of the Australian population.

“We want to talk to our clients in the language and way they best feel most comfortable in… and understanding and engaging in and on a platform that they feel most comfortable in.”

This approach has also been translated into stores as well with sales associates who speak fluent Mandarin, he added.

WeChat recently praised David Jones’ SS20 Beauty campaign as a part of a global showcase of best-in-class activity and it was the only international retail store featured on the list.

The beauty campaign, themed Full Bloom, included video, imagery, emails, in-store visual merchandising, a 36-page print booklet and shoppable article pages.

“With clever use of shoppable product display functions and rich graphic design elements, the campaign achieved a click through rate of more than double that of industry benchmarks,” WeChat said.

Another “incredible success story” for the China market has been landing Kim Kardashian’s popular Skims line, Mr Holloman said.

“She can be polarizing, but it’s been a commercial success and from what we hear from customers, they are excited to have such exclusive brands across our network,” he said.

The retailer copped fierce backlash when it announced it was stocking the star’s products, with loyal fans of the store accusing the world-famous influencer of diminishing the retailer’s “class” after DJ’s shared a video to their Instagram page of Kim promoting the brand.

However, despite its investment in WeChat, David Jones has no presence on another social media platform that has been blowing up – TikTok – which has over one billion users.

“We are incredibly strong on Instagram and on Facebook, we have in excess of 400,000 followers on Instagram and 600,000 on Facebook,” Mr Holloman said.

Queensland University of Technology retail expert Dr Gary Mortimer said David Jones’ use of WeChat is a “great strategy”.

“They are taking advantage of a growing middle class affluent Chinese market that does often look for Australian brands and often international brands and David Jones has the ability to provide those brands to that particular audience,” Dr Mortimer told news.com.au.

“When you look at what they are doing in that space they would be aligning themselves with Chinese influencers that connect really well with that Chinese market.

“They would be leveraging really large online promotional events like Singles Day that runs on the 11 November every year and it gets bigger and bigger.

“Singles Day is a bit like Amazon Price day but it turned over about $US85 billion ($A122 billion) last year. The Chinese market is a very valuable and viable market for Australian business and brands.”

Dr Mortimer said China’s population of 1.3 billion compared to the “tiny” 26 million living in Australia also showed it was a lucrative field to play in.

“Trust is huge issue for the Chinese population who are concerned about counterfeiting, so working on a Chinese platform gives legitimacy for David Jones in that market,” he added.

“Woolworths is playing in that space as well.”

In 2015, Woolworths opened its first overseas flagship store on the Tmall website and has also partnered with supermarket 7 Fresh since 2020 offering WeChat as a payment system.

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MG7 luxury sedan will take on Audi A7, BMW Gran Coupe

MG plans to take its brand up-market with a prestige sedan to accompany its upcoming sports car.

Not content with taking on the likes of Mazda’s MX-5 and the Porsche Boxster with its new convertible based on the MG Cyberster concept, the brand has its eye on high-end European machines.

A new “Black Label” sub-brand will offer more luxurious models than MG’s usual fare.

While it won’t be a brand in its own right, like Toyota’s Lexus or Hyundai’s Genesis, MG’s Black Label will represent a step beyond its current range of affordable hatchbacks and SUVs.

Chinese customers will get first dibs on the new range, starting with the MG7 sedan revealed this week.

Wearing a four-door coupe body similar to Audi’s A7 or BMW’s Gran Coupes, the MG7’s sophisticated shape takes the brand into new territory.

We haven’t seen the interior but you can bet it will build on the high-tech features found in MG’s regular line-up – delivering crisp digital displays, impressive driver aids, multi-coloured ambient lighting and much more.

A duck-tail bootlid transforms into a pop-up rear spoiler similar to Porsche’s Panamera and enormous quad exhaust tips suggest power could come from a muscular petrol engine.

Technical details surrounding the car are slim.

Car News China suggests the model will have a four-cylinder turbo engine with 189kW and 405Nm, positioning the MG7 closer to Volkswagen’s Arteon than Audi’s RS7.

MG’s Australian arm intends to ramp up its premium appeal with the new sports car, but the first Black Label machine is unlikely to make a local debut.

A spokesman for the brand said “we are constantly listening to the needs and wants of our customers, but at this stage, we will not be bringing the MG7 into the Australian or NZ market”.

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