For a long time, France has enjoyed a positive image among the Chinese. The Enlightenment philosophy, the French Revolution and the Declaration of the Human and Citizen Rights are of remarkable influence in China.

And so is the historical French culture, which boasts numerous masters in literature of the 19th century, such as Victor Hugo, Honore de Balzac and Emile Zola. They have become household names in China.

During the 1920s and 1930s, some of the first generation of New China's leaders, including Zhou Enlai, Chen Yi and Deng Xiaoping, studied in France. That history had a pioneering impact on the Sino-French relationship.

In January 1964, France established diplomatic relations with the People's Republic of China, being the earliest among the leading industrial Western countries. This helped Beijing to get rid of its isolation from international affairs.

Friendly history

The French had already shown great interest in China in the 18th century. And such interests were more in spirit than in commerce.

In the 19th century, France under the Third Republic reached its peak. It was among Western powers that were then building concessions and carving up spheres of influence in China.

But at that time, Victor Hugo stood out as the sole literate in the West to expose the crime of looting and burning down Yuanmingyuan (the Old Summer Palace) in Beijing by the invading Anglo-French Allied Forces during the Second Opium War in 1860.

Andr Malraux narrated in his works "La Condition Humaine (1933, Man's Fate)" the massacre of communists in Shanghai in 1927.

The novel was listed in books introducing the origin of the Chinese revolution in the history of world literature.

In the late 19th century, translations of important Chinese and French works began to appear in both nations, which displayed the reciprocity between China and France in a clearer manner.

The Chinese often describe the special friendship with France as "romantic."

This is not accurate as the word should be of mixed meaning related to free thoughts and actions. It implies that emotion weighs more than courtesy. It defines a character that is unique, heroic and creative.

In China's trends of thoughts, the word should be granted to Qu Yuan, who embraced lofty, free and tragic spirits. And the word would also fit the images of Jia Baoyu, hero of "Dream of the Red Mansion" ("Hongloumeng").

When the Chinese say that the French are romantic, they are not outsiders, for the Chinese culture has a romantic face itself.

The reason why Chinese think highly of and favour the French culture is because they also pursue the values the French culture expresses.

The two nations walked a long way together, yet have never been face-to-face until today.

Mutual exchanges

Political exchanges between Chinese and French leaders have never been so frequent.

Last year saw 14 visits on the ministerial level and one mutual visit on the premier level.

And there will be more in 2006, including the historical mutual visits by presidents of French Parliament and the Standing Committee of the National People's Congress of China.

An exchanging project involving 400 Chinese youngsters and 400 French peers will come into practice this year. The event is without precedent in the history of interaction between the two nations.

The great success of the Culture Years in China and France over the past two years is leading the two countries in the direction of mutual benefits. One such example is the Sino-French "Exchanging" Art Festival held in spring.

Last October, the Chinese Government declared its support of signing the international convention of protecting diverse cultures.

Since November 2004, China has founded several Confucius institutes, following the example of the Alliance Franceaise.

And the Centre Culture Franceais de Peking is the first officially approved resident foreign cultural institute in China.

These are all symbols of the co-operative partnership in cultural policy between the two countries. Another example is for the first time, a Chinese director was elected chairman of the Cannes Film Festival this year.

In France, a book, titled "China changes the world," has recently come off the press.

The development of China is indeed changing the world, which requires all its co-operative partners, including France, to adjust their policies.

The author is Minister Counselor of the French Embassy in Beijing. He delivered the speech at the French subsidiary of the Beijing-based Western Returned Scholars Association on February 8 this year

(China Daily 10/25/2006 page17)

China and France will work to explore ways to further their strong relationships in the spheres of economy, culture, international politics and other areas, with the upcoming China visit by French President Jacques Chirac.

"What we want on this important occasion is to confirm what we have done during the past few years, and build (our relationships) for the future," Philippe Guelluy, French Ambassador to China, said in an exclusive interview with China Daily.

Arriving in Beijing today, French President Jacques Chirac will discuss with Chinese President Hu Jintao various bilateral and international issues.

The two presidents will also ink several agreements "to demonstrate the quality of our relationships, not only in the economic sector, but also in other sectors," said Guelluy, adding that they were still working on the list of agreements.

"In the economic sector, the two presidents some years ago decided on co-operation in important strategic areas such as civil aviation, energy and railways," the ambassador said. "As the areas of co-operation become larger, we have expanded into areas such as environment, finance and agriculture, water and gas distribution" he said.

"We have a strong tradition in agriculture and you have a strong tradition also, and we can do more in this sector," he said.

French companies are also very active in co-operation with their Chinese partners in water treatment, waste management, pollution control and energy saving - to curb environmental deterioration, which is one of the priorities of Chinese Government. Joint ventures also involve nuclear energy, road construction, scientific and technological research and medicine.

The ambassador pointed out that France has invested a lot in China, and he believes that "We are the third biggest investor in China from Europe." French investments in China increased by 49 per cent in 2005 year on year.

There are 800 French enterprises working in China, opening more than 1,000 factories in China and employing more than 200,000 Chinese, he said.

According to the Chinese Ministry of Foreign Affairs, by March 2006, projects involving investment in China from France numbered some 3,017. China and France have long-standing agreements on ocean-going and air transportation, long-term economic co-operation, avoidance of double-taxation, investment protection and intellectual rights co-operation.

China and France have pushed for scientific and technological exchanges and co-operation, especially in the fields of environmental protection, development and peaceful use of atomic energy, health and medical sciences. "We have more and more French researchers and scientists working in laboratories in China for long periods," Guelluy said.

The governmental Joint Commission on Science and Technology meets every year to advance technology research plans.

Up to the end of 2004, the two sides had signed a total of 2,313 contracts introducing technologies totalling US$12.2 billion and covering areas such as space utilization (remote sensing technology), co-operation in nuclear energy, artificial intelligence, coal cleaning and electricity generation with wind power.

In education, some 120 colleges and 20 middle schools in China have opened exchange programmes with their counterparts in France.

Cultural exchanges between the two countries have been expanding. Especially the Year of China in France and the Year of France in China between 2003 and 2005, which involved millions of participants and viewers from both countries, enhancing understanding between the French and Chinese.

France and China now have regular cultural festivals in each other's country in alternate years, the ambassador stressed. French Embassy organized the "Festival croisement" (exchange) in China this year. "Next year, we expect a part of this festival will also take place in France, to present Chinese art and culture to French public," Guelluy said. "We can do a lot to preserve and to expand our cultures," he added.

French president's visit

Chirac's arrival will be his fourth visit to China as French president, with his previous tours being made in 1997, 2000 and 2004.

Guelluy noted that Sino-Franco relations have reached a "zenith" - "we have regular visits between both countries, we have regular high-level meetings, and exchange of visits between presidents and prime ministers," he said.

The most recent took place in July in St Petersburg, where Chinese President Hu Jintao and French President Jacques Chirac met after the conclusion of the outreach session of the G8 summit. During the meeting, Hu said that current ties had reached a historic high, Xinhua News Agency reported.

Chirac said he agreed with Hu's observation, noting that the planned set-up of an A320 general assembly line of Airbus in China would signal a new starting point for aeronautic co-operation between the two countries.

During the meeting, Chirac said Chinese-French friendly ties had solid political foundations and the two countries had broad co-operation and exchanges in economic, cultural and other fields, Xinhua reported.

The French President reiterated that the Chinese-French all-round strategic partnership was established on the basis of common world views, as the two countries shared the same or similar views on many international and regional issues.

"Despite the distance and cultural differences, we now have reached the level of intimacy between our two countries and people," the ambassador stressed.

(China Daily 10/25/2006 page17)

France expects exports to the Chinese mainland to grow by at least 20 per cent this year from 2005, mainly boosted by China's booming economy and the strenuous efforts made by both nations to enhance bilateral ties.

"We expect exports to the Chinese mainland to reach more than US$11 billion this year, compared with last year's US$9 billion, according to statistics from the Chinese side," Hubert Testard, chief of the economic mission at the French embassy in China, told China Daily in an interview.

Trade volume between China and France climbed 17.5 per cent to hit US$20.65 billion last year, according to statistics from the Ministry of Commerce (MOFCOM).

This year will also witness the first increase in five years of France's market share in China's imports, which is expected to reach 1.45 per cent, compared with the roughly 1.35 per cent of the past three years, said Testard.

"That's because the market share from many other western countries to China are on the decline," explained Testard.

Currently, France is the second-largest exporter to China among the European Union nations, after Germany and followed by Italy and the United Kingdom, according to statistics from the French embassy.

"Although the current trade level (with China) is not quite satisfactory, we are satisfied with the trend, which we think is very positive," Testard said.

In the years to come, areas that have big potential for trade and investment growth between China and France include aircraft, consumer goods, infrastructure, energy, environment, telecommunications and the heavy industry.

According to MOFCOM statistics, French companies channelled an investment of US$615 million in 2005, ranking fourth among the major EU countries doing business in China.

Paris-based Airbus announced recently that it would soon reveal further details about its A320 final assembly line in Tianjin in North China. The Tianjin plant, which is reported to be 51 per cent controlled by Airbus, is the French firm's first aircraft assembly line outside Europe and highlights its great commitment to the tremendous Chinese market.

The plant's first jet was expected to come off the assembly line in 2008.

For consumer goods, Testard said as the average income of Chinese residents increases, there will be a growing number of middle-class Chinese people preferring to buy famous foreign brands, ranging from cosmetics, fashion to luxury goods and the like.

"There will be a significant growth (in French exports of consumer goods to China), and it is a long-term trend," said Testard.

In addition, as the world's fastest-growing major economy fuels the rapid development of China's energy and infrastructure projects, Testard also sees great potential in further Sino-French co-operation in these areas.

Alstom, the world's leading power and transport company, will increase its presence in China's power industry by expanding its manufacturing capacity, Philippe Joubert, president of Alstom Power Generation, said in June.

The company has officially opened Alstom Beizhong Power Co Ltd, a joint venture with Beijing Heavy Electric Machinery Works. Located in Beijing, the joint venture's investment in manufacturing facilities and equipment alone amounts to approximately 800 million yuan (US$100 million), according to Alstom.

French power giant EDF, a leading foreign investor in power generation in China, now operates coal-fired power plants with an installed capacity of 3,720 megawatts.

Driven by China's surging energy demand, EDF is actively looking at more business opportunities in the booming Chinese electricity market.

When Premier Wen Jiabao made his official visit to France last December, he predicted Sino-French trade was likely to double to US$40 billion by 2010.

Responding to the forecast, Testard said it is possible for bilateral trade growth to remain an annual rate of about 20 per cent within the coming years, and the 2010 target set by Wen is "realistic."

"We not only sell products and sign contracts in China, we are aiming for a long-term strategic partnership with China," Testard said."By combining the Chinese and French strengths, we can better provide service to the Chinese market, and serve other countries."

(China Daily 10/25/2006 page18)

France enjoys huge popularity in China: Paris is the city where most Chinese couples would like to spend their honeymoon; French wine is believed to be the best; and goose liver and snails are enjoyed by many Chinese.

France is not only well-known for its "art de vivre" (living art), but is also home to some highly-advanced technologies in various fields, in particular, environment, energy, telecom, transportation, agri-food and car industrie. The recent victories of Renault and Michelin in the F1 world championship illustrate some of the successes of France technologies.

While China-France economic and trade relations deepen and the Chinese become affluent, services from France like luxury consumer services, logistics, and financial services have a chance to play a significant role in balancing and promoting economic exchanges between the two countries, said Annick de Kermadec-Bentzmann, president of the French Chamber of Commerce and Industry in China (CCIFC).

"Globally speaking, overall co-operation between France and China is very positive," said Bentzmann, who was born in China and has worked in China for the past two decades.

Statistics from France show annual bilateral trade has risen from 9 billion euros (US$11.43 billion) to 30 billion euros (US$38.1 billion) in the past 10 years. It is also encouraging that the trade imbalance between China and France is narrowing.

In 2005, China had a trade surplus of US$2.6 billion against France, but in the first eight months of this year, the growth of French exports was by 25 per cent, twice the speed of the growth of China's exports to France and the trade deficit on the French side was US$1.15 billion, according to the Ministry of Commerce in China.

"Up to now, there is quite a big deficit on the French side, but we have seen the trend that imports from France have been growing faster than exports from the Chinese side," said Bentzmann. "We should be exporting more to China," she added.

While a big focus of China's exports has been on machinery and equipment, there will be increasing demand for high-tech and luxury consumer goods and services from France.

According to an Asia-Pacific wealth report by Merrill Lynch, China has 320,000 people each with a wealth over US$5 million and three fourths of these people are 55 years or younger, the youngest population of millionaires in the region.

Chinese tourists are almost in every corner of Paris and rich Chinese people become big buyers of French luxury goods like Louis Vuitton, Moet & Chandon and Hermes.

As this year is a critical year for China to honour its commitments to the World Trade Organization (WTO), many of which are in the service sectors such as retailing, banking, insurance, distribution, architecture design, and telecommunications, French firms with their global competitiveness will also benefit from the opening, said Bentzmann, who is also the executive general manager of the French banking giant BNP Paribas' Shanghai Branch.

"I believe very honestly that it can only be positive in the future," she said.

According to the commitments, big French names like Carrefour and BNP Paribas do not need to form joint ventures with Chinese partners anymore and can open offices wherever they want.

The development of the retailing giant Carrefour has brought many of its small and medium-sized suppliers into China, 250 in the last year alone.

The head of the board of CCIFC believed the investment environment in China had improved and that French firms, especially the small and medium-sized ones were no longer "shy" in coming to do business in China.

In the past two years, CCIFC has helped provide a lot of information about China through media coverage and companies have begun to get a true picture of the market.

The French business community in China, one of the biggest foreign employers in the country, is still growing, as the number of CCIFC's members is approaching 1,000, compared with 850 in 2005.

(China Daily 10/25/2006 page18)

One of the main missions of the French Chamber of Commerce and Industry in China (CCIFC) is to develop the presence of French SMEs in this country and help them better understand the Chinese market.

Florence Gomez, general manager of CCIFC, said that her organization has drafted a three-year action plan which core components are to match the French offer with the Chinese needs and spread information on how French companies can invest in or procure from China, and what factors they should pay attention to when doing business in the world's fastest growing major economy.

"We have done a lot in providing information about the Chinese market and helping French companies do business here, but one area that we do not do well enough is grasping the needs of Chinese economy, as it is usually very difficult to get accurate information," said Gomez.

"We are happy to have the financial support from the network of French Chambers of Commerce in France, which regards China as a prime opportunity in French companies' overseas expansion."

She said starting in January 2007, CCIFC will visit French companies and local governments in a certain number of Chinese provinces such as Hubei, Sichuan, Shandong, or Liaoning, where many French companies have established operations.

They will try to understand the progress and difficulties of French firms there, talk with government officials about how French companies can establish their businesses, and also see what the local needs are.

CCIFC will also develop its services to French Companies and is planning to organize specific missions on how to set up shops in Beijing, Shanghai, or other cities, and focus on sectorial missions.

They will also issue by the end of this year a publication on recruiting people in China, including salary levels and unique strengths in talent pools in different cities, another key area that SMEs are concerned with when investing in a foreign country.

As China and France are in their honeymoon of economic and trade relations, the focus of French companies' development in China has shifted to small and medium-sized enterprises.

According to Gomez, at present 75 per cent of her 980 member companies in China are small and medium-sized. Most of these firms are quite successful and a special prize for the best performing French SME in China will be remitted for the first time this year during the annual gala dinner of the CCIFC on October 28, by the French minister of Foreign trade Christine Lagarde.

In the past five years, the activity of French firms in China has increased significantly, as CCIFC members almost doubled, and more importantly, smaller firms are adding more and more vitality to France-China economic co-operation.

Last year alone, CCIFC helped 250 such companies come to China, therefore helping to reach the target set by the French President Jacques Chirac, to help 1000 new French SMEs doing business in China in 2005 and the following years.

"When I visited firms in different cities in France several years ago, many of them thought that China was 'another planet' and that cultural differences and obvious language barriers were quite dissuasive," said Gomez.

"But now with increasing coverage of China by the French media, quite abundant during the cultural crossed years, these companies have a better comprehension of China," said Gomez.

To help French SMEs understand how to do business in China, CCIFC created a CAP China club in 2003, which is formed of 60 French Chambers of Commerce and Industry based in France among which the biggest ones such as Paris, Lyon, Marseille.

The CAP China club meets four times a year and CCIFC briefs its members on recent developments in China in such areas as HR, new regulations, logistics, distribution, specific sectors of activity, and other particular projects. The club members then pass the information to their member companies in France.

The CCIFC also provides an office leasing service to those SMEs, which can work next door to the organization and receive help. Till now, CCIFC's three offices in Beijing, Shanghai and Guangzhou offer 60 office sites to such firms, rising from 21 last year.

(China Daily 10/25/2006 page18)

Statistics from the Invest in France Agency (IFA) Greater China show that the number of Chinese mainland companies in France has surged to 100. The figures are the same for enterprises from Hong Kong and Taiwan.

Most of these mainland companies' presences are representative offices but a few of the larger ones have decided to set up operations in the country.

It is proof that China is becoming increasingly important in terms of international investments.

On the other hand, a study conducted by IFA indicates that France enjoys a good image among Chinese business circles. Chinese managers feel a strong affinity with France on a personal level.

More than two thirds (67 per cent) of the Chinese managers have a positive opinion of France's economy and business. Among the European countries, France is perceived to be the most attractive location for Chinese investments, equally placed with Germany.

The major competitive advantages of France listed by Chinese interviewees include the Sino-French relationship, its geographical position in Europe and its infrastructure, the general business environment, its economic maturity and quality of life.

More Chinese enterprises are choosing France as their gateway to Europe and achieving success in the overseas market.

"France is a very open country to international investments," said Remi Girardot, chief executive officer of IFA Greater China.

"As the world's fifth largest economy, France received yearly foreign direct investments of around 40 billion euros (US$50.8 billion). It is internationally competitive in many industries, including logistics, communications, agricultural product processing and automobiles, which perfectly complements the growing needs of China's economy," he told China Daily in an interview.

IFA under the French Government is responsible for promoting, prospecting and facilitating international investment in France. It also co-ordinates initiatives promoting France's image.

IFA set up its Greater China headquarters in Shanghai in 2005, to better respond to the increasing number of Chinese companies, which had cast their eye on the European market.

"We focus on providing Chinese investors with legal support, investment consultation and generally helping them take their business across the world. In the last two years, IFA China has witnessed an amazing increase in the number of projects. More than 50 investment projects from Chinese companies are currently being treated," said Remi Girardot.

Close partnerships are established in certain key industries, such as the automobile sector, where several Chinese groups have the ambition of being present in Europe under their own trademark, such as Cherry, Geely and SAIC.

Most of the employees of IFA China are Chinese and have perfect knowledge of the Chinese economy and of the Chinese mentality. In France, IFA works in partnership with regional development agencies to offer international investors outstanding business opportunities and customized services. For potential Chinese investors in France, Girardot suggested that they be well prepared for the move. The Shanghai office can provide companies with customized, confidential and complimentary services and information.

(China Daily 10/25/2006 page18)

French environment service giant SUEZ has recently signed a 30-year concession right to manage and operate a wastewater treatment plant with Chongqing in Southwest China, another move that reaffirms the company's commitment to being a major player in the country's environment sector.

The 50-50 joint venture created in April 2006, between the Chongqing Water Company and the SUEZ subsidiary, Sino-French Water Development, will manage, operate and maintain a 300,000-cubic-metre-per-day wastewater treatment plant in Tangjiatuo. The concession right runs for 30 years and concerns sewage services for the Jiangbei and Yubei districts in the northern section of Chongqing. This joint venture will also cover customer services and draw upon advanced sludge treatment technologies.

Total investment for this project will come to 60 million euros (US$72.9 million).

Sewage treatment represents a major environmental challenge for China and for Chongqing, with a population of 32 million, situated in the upstream of the Three Gorges dam on the Yangtze River.

Suez's commitment

SUEZ will provide expertise to optimize the management of sanitation services and strengthen environmental protection, and the plant will benefit from the managerial and technological expertise of SUEZ in wastewater treatment services, said Gerard Mestrallet, SUEZ chairman and chief executive officer.

Since 2002, through its subsidiary, Sino-French Water Development, SUEZ has provided drinking water management services to 1 million residents in Chongqing. With this concession, SUEZ thus becomes the first foreign operator to supply a Chinese urban area with both water and wastewater treatment services.

This new contract comes a few weeks after SUEZ was designated a preferred bidder in conjunction with a 30-year concession contract totalling over 1 billion euros (US$1.2 billion) for Changshu, a city in East China's Jiangsu Province.

Earlier in February, the firm announced its intention to establish its regional headquarters in Shanghai, in a bid to further enlarge its presence in the country.

Given recent growth indications, the group may double in size over the next 2 years, investing accordingly. By 2005, the Group's investment in water amounted to 237 million euros (US$287.9 million), accounting for almost two thirds of its total investment in China.

In addition to water treatment, it also conducts waste management in the country.

The company has designed, built and will operate through Swire SITA, a 60,000-ton-per-year hazardous waste incineration plant for processing waste generated by industries operating at the Shanghai Chemical Industry Park. It will be a pioneering plant for China both in terms of size and technology.

China has become increasingly appealing to domestic and international water service companies, since the government realized that a shortage of fresh water poses a threat to the nation's economic health. The government has said the country is preparing to spend heavily on the sector.

It is reported that China plans to spend about US$125 billion over the next five years to improve water supply and wastewater treatment. More than US$43 billion has been earmarked for sewage treatment plants in urban areas.

For SUEZ, China accounts for about 5 per cent of its environment business line, with the revenue increasing 20 per cent last year to approximately 600 million euros (US$728.9 million).

SUEZ has been active in China for over 30 years through Sino-French Water Development, Swire SITA Waste Services and Degremont, and its 7,800 employees. It has so far designed and built over 160 water treatment plants in the country.

Today, close to 20 per cent of China's urban population, which is about 250 million people, drink water produced by water treatment facilities designed and built by Degremont, SUEZ's water treatment plant specialist.

Group portfolio

Sino-French Water Development, established in 1985, a 50-50 joint venture between SUEZ and the New World Group of Hong Kong, produces or manages water in over 15 Chinese mainland cities, such as Chongqing, Qingdao, Sanya, Tanggu and Shanghai, and provides distribution services to 12 million people. Since the mid 1980s, SUEZ has also provided drinking water production and distribution services in Macao.

Swire SITA Waste Services, established in 1989, a 50-50 joint venture between SUEZ and Swire Group of Hong Kong, provides waste services in Hong Kong and Macao and also operates two landfills, WENT and NENT, in Hong Kong which are among the largest and most modern in the world.

SUEZ, an international industrial Group, designs sustainable and innovative solutions for the management of public utility services as a partner of public authorities, businesses and individuals.

The Group aims to meet essential needs in electricity, natural gas, energy services, and has extensive expertise in all dimensions of water and waste management, allowing SUEZ to build and maintain long-term partnerships that meet the specific needs of each customer and respect the environment. SUEZ is listed on the Brussels, Luxembourg, Paris, New York and Zurich stock exchanges. SUEZ employs over 157,650 people worldwide and generated 41.5 billion euros in revenues last year.

(China Daily 10/25/2006 page19)

China and France, as well as China and Europe, should further strengthen their financial co-operation, expressed top officials from both China and France at the Sino-French Financial Forum held in late September in Shanghai and Beijing.

The forum, jointly sponsored by the People's Bank of China and Banque de France, attracted more than 500 participants from the two countries' financial sectors.

"We hope the forum will be a starting point to change the co-operative status between euro countries and China and lead to deeper co-operation," said Jean-Patrick Yanitch, financial councillor of the economic mission of the French Embassy in China.

According to Yanitch, financial co-operation between European countries and China is relatively inactive compared with co-operation between China and the United States.

"Sino-European and Sino-French financial co-operation has bright prospects," said Zhou Xiaochuan, governor of the People's Bank of China.

The further development of a Sino-European comprehensive strategic partnership has provided a strong basis for financial co-operation, he said.

Statistics show the European Union is China's largest trading partner, the largest technology provider and the fourth largest investor.

In 2005, bilateral trade volume between China and Europe totalled US$217.3 billion, an increase of 22.6 per cent year-on-year.

Economic and trade co-operation between China and France has also expanded. Today, France is China's second largest technology provider, the third largest investor and the fourth largest trading partner among EU countries.

The bilateral trade volume between the two countries reached US$25.93 billion last year, 22.5 per cent higher than the previous year. Growth of imports and exports both exceeded 20 per cent.

Strengthened co-op

During the past few years, the two countries have had fruitful co-operation in aviation, energy and environmental protection fields. French companies including Veolia, Alcatel, Michelin, Renault, Carrefour, Danone and Lafarge have all established businesses in China.

Accordingly, many French financial institutions are looking for opportunities to co-operate with Chinese counterparts.

"The size and dynamics of the Chinese market have given European companies room for further development," Zhou said, "at the same time, large inflow of European investment provides capital and technology support for sustainable and rapid economic development in China."

He told the forum that the financial market had shown a trend towards globalization and the Chinese Government would continue efforts to develop the financial market, further open up the market in a gradual and orderly manner and promote the renminbi's free convertibility steadily.

Christian Noyer, governor of Banque De France, highly praised the Chinese Government for its gradual approach in opening-up of the financial market.

Moves like the launch of the qualified domestic institutional investors (QDII) scheme show the government's determination to open up its financial market, he said.

He urged French banking institutions to take opportunities to strengthen co-operation with their Chinese counterparts.

Gerard Mestrallet, chairman and CEO of Paris Europlace, called for more co-operation and exchanges in the financial sector between the two countries, in particular in banking, insurance and assets management.

"It is crucial for the financial market in Paris to develop a co-operative relationship with the Chinese financial market, as both countries are given the task of enhancing the competitiveness of the financial markets," he said.

European opportunities

At the forum, French participants welcomed Chinese investors interested in euro financial products, encouraged Chinese enterprises to list on the pan-European Euronext exchange and Chinese financial institutions to issue bonds in Paris.

Arnaud de Bresson, senior executive of Paris Europlace, said Europe is more attractive since the United States issued the Sarbanes-Oxley Act in July, greatly raising the cost for foreign enterprises of listing in the United States by strengthening requirements on business information.

"The European Securities market is more flexible in management, the yield of euro bonds is consistent and many financial derivatives are available in the market," he said.

According to him, the scale of the EU capital market is valued at 10.95 trillion euros (US$13.9 trillion), second only to the 16.9 trillion euro, or US$21.5 trillion capital market of the United States and higher than the 7.5 trillion euros (US$9.5 trillion) of Japan.

Euronext has been talking to potential Chinese candidates, including financial groups and biotech companies, about listing in its market.

The first Chinese company is likely to be listed in Euronext in the first half of 2007, Erik Wenngren, director of Euronext's international listings said. The company plans to raise 50 million euros (US$63.5 million) to 100 million euros (US$127 million).

During the forum, Euronext and the Shanghai Stock Exchange signed a memorandum of understanding (MOU) to strengthen the framework for a relationship and co-operation for mutual benefits.

They will study the feasibility of distributing the relevant products in China and on Euronext markets.

They will also share information on products and services, the financial environment, regulations and policies applying to their markets and information technology, to aid mutual development.

Under the MOU, regular meetings will be held at an executive level and joint research projects or seminars will be organized on topics of mutual interest.

(China Daily 10/25/2006 page19)

Building up a local bank for Chinese people is Societe Generale's strategy in China, featuring a typical "Chinese approach."

"We don't want to be a foreign bank only targeting a small number of wealthy people. Instead, we would like to be a universal local bank serving all Chinese customers," said Marc Poirier, China Country manager of Societe Generale.

According to Poirier, fully understanding China and respecting its rules and people is the striking advantage of Paris-based Societe Generale (SG), one of the leading financial service groups in the euro zone.

Take SG's bidding for a stake in the Guangdong Development Bank (GDB) as an example, the French bank teamed up with petroleum giant Sinopec at the beginning of the battle and then included top steelmaker Shanghai Baosteel Group Corp.

"Our local partners can help us better understand China and the demands of Chinese customers.

Poirier confirmed that Baosteel Group Corp and Sinopec Corp have agreed to take equal 20-per-cent stakes. Canadian fund manager Caisse de Depot et Placement du Quebec recently joined the Societe Generale consortium, aiming to take a 5-per-cent share, while two smaller Chinese partners joined in December 2005 to buy a further 20-per-cent stake alongside Societe Generale.

"We have made an offer, and we are ready to sign a cheque," said Daniel Bouton, chairman of SG. "The decision was originally supposed to be made by the end of January."

GDB's national outlet is the best platform for SG to run its retailing business, which remains the backbone of the French bank.

"GDB will be our only investment in a commercial bank for retail banking, consumer finance and credit cards," Poirier said.

But for the moment, SG only runs corporate and investment banking businesses (SG CIB) in China.

"In the CIB aspect, further developing the derivatives business will be our major focus in China for the year since we have been quite strong in structured and export finance," Poirier stressed.

For SG Chairman Daniel Bouton, equity derivatives are important.

"A main pillar of this corporate and investment bank is equity derivatives, both in terms of revenues and management capabilities," he said.

JP Morgan's analysts also suggest that SG is better placed than any other bank to benefit from the growth of equity derivatives, in particular in the retail and private banking markets.

They say equity derivative businesses should be valued at 14 times earnings, rather than the traditional eight times because revenues and profits are much more stable than previously believed.

And they believe equity derivatives should generate a 30 per cent to 40 per cent net return on equity, in addition to a 15 per cent per annum revenue growth over the next three years.

Then how could SG stay ahead of the game in equity derivatives?

For one thing, it has taken full advantage of its first-mover position. Secondly, it invests heavily in its technology infrastructure, to the tune of US$250 million a year just to update IT systems, according to insiders.

Meanwhile, SG continues to attract the youngest and brightest mathematicians to its quantitative modelling team; at any point, SG might have up to 50 highly trained scientists working in product innovation. Over the past three years, the division has hired on average 120 staff a year to its front-office team. It is therefore a business with high barriers to entry.

The other two major business lines for SG in China are special financial services and asset management.

In 2006, SG set up a leasing and renting arm in China, a fully owned subsidiary for leasing and fleet management. It also launched an equipment and vendor finance business.

"We hope to enter the consumer finance market, including auto financing, consumer loans and credit cards," said Jean-Francois Gautier, head of SG's special Financial Services sector.

(China Daily 10/25/2006 page19)

More and more Chinese students are choosing France as their ideal overseas study destination.

Statistics show that about 6,800 students went to France in 2005, an increase of some 700 people compared with 2004. At the same time, other overseas study hotspots for Chinese students have witnessed a declining trend.

"1998 was a turning point in the development of Chinese students going to France," said Pierre Yang , director of the Beijing Office of EduFrance, an official agency that provides Chinese students with knowledge about studying in France.

Before 1998, only a few hundred Chinese students went to France each year. In 2003, about 6,300 students left China for France to study and from 2004 until now the figure has risen steadily.

Yang predicts that this year the number will hit 9,000, a historical high.

Currently, about 50,000 students are studying in Britain, while in France the figure is 20,000. "So the trend of studying in France is only in its infancy, leaving huge potential for further development," Yang said.

The fast economic development of China, the influence of the French Culture Year in China last year, and preferential policies for foreign students has made France a more popular study destination, Yang said.

The rapid growth of China's gross domestic product (GDP) is making residents' wallets swell, and more parents have the opportunity to provide their children with a top-notch education and a more internationalized scope of knowledge.

"The frequent and fruitful bilateral relations, as well as the expanding and deepening influence of the French Culture Year has significantly promoted French culture in China," Yang said.

"Another reason why students are choosing France is because study in some other countries is too expensive. France gives me greater opportunities to spend two or three years on study. And the knowledge of French language and culture will provide me an advantage when looking for a job in an international company, " said a student from Peking University who has undertaken in-depth research on overseas study destinations, during the French Business Schools Workshop in Beijing on October 15.

The workshop gathering the top 10 business schools in France lured more than 400 students from several top universities in Beijing.

The revision of the policies for overseas students in France starting from this year will encourage more Chinese students to turn their attention from the United States and Britain.

"The 'good' policies offer good opportunities for excellent students in terms of obtaining visas and helping them to find jobs in the country," Yang said.

"These policies are good for excellent students, especially those specialized in science and technology, who can henceforth, after obtaining a master degree, get a temporary resident card in order to look for a job in France," Yang said, pointing out that the French government now can offer a working permit card for these excellent overseas students who succeed in finding jobs.

Every year, EduFrance offers some 50 activities in China to enable Chinese students to understand the French higher education system and reinforce the attractiveness of French higher education.

(China Daily 10/25/2006 page21)

With its Chinese counterpart PetroChina, France-based global energy giant Total is right on track studying the feasibility of and preparing for the development of the South Sulige Block in Ordos Basin, sources from the multinational revealed recently.

"Total participates in the development of gas resources in China. An active production sharing contract is in progress with PetroChina on the high-profile South Sulige Gas Field," a spokesperson from the French oil and gas producer told China Daily.

Besides the South Sulige project, "several other onshore and offshore opportunities are also under evaluation," according to Total's China business agenda. The French energy powerhouse did not elaborate on more potential programmes.

Total and PetroChina Co Ltd, on behalf of China National Petroleum Corporation, signed on March 2 this year a production sharing contract (PSC) for the evaluation, development and production of the natural gas resources of the South Sulige block. The contract became effective on May 1, 2006. The block covers an area of around 2,390 square kilometres located in the Inner Mongolia Autonomous Region. It is part of the Ordos Basin, one of the most resource-rich in China.

A memorandum of understanding (MOU) on natural gas sales and purchase agreements was also signed on the same day. The signing of the contract and the MOU has further strengthened the strategic partnership between PetroChina and Total. Through co-operation, Total and PetroChina look forward to leveraging on their respective competitive edges to accelerate the development of the natural gas reserves in South Sulige and start commercial production at the earliest date.

As a wholly owned subsidiary of Total, Total E&P China (TEPC) was established in July 2006 for the implementation of the Sulige South Project and other future projects in China. TEPC will be the operator of the project.

According to Total, the mission of TEPC is to "develop hydrocarbon resources in a safe, efficient, responsible and environmentally friendly way and contribute to the sustainable development in China and to long-term co-operation between Total and Chinese companies".

As one of the oil giants in the world, Total has been playing a leading role in oil and gas exploration and production around the world. PetroChina is the largest producer and supplier of crude oil and natural gas in China, assuming strategic responsibilities in the market.

During recent years, Total has been actively participating in onshore oil and gas exploration activities in China. In 2002, PetroChina teamed up with Total to commence a joint study on the natural gas reserves in the South Sulige block. Based on the joint study and through open and friendly negotiations, agreement was reached on the evaluation of the permit and joint development and production of natural gas from the block.

Total and PetroChina will form joint teams, mixing staff from both companies. Total will have a leading role in the first phase, which is due to last until late 2008. The working programme will include acquiring and interpreting new seismic, re-entering existing wells, and drilling new ones, in order to decide on a full field development at the end of this first period. As soon as they are formed, the teams will start working simultaneously in Beijing, and Xi'an and Jingbian in Shaanxi Province.

The PSC is a major agreement since there looks to be a huge volume of gas involved and the low permeability of the reservoirs represents a real technological challenge. Total has been asked to clear up the uncertainty surrounding well productivity and optimum well locations before a decision is made as to whether to start field development in 2008.

The development project plans to drill more than 400 wells and build a number of treatment and compression installations. The field is expected to come on stream in 2011 and should produce up to 4 billion cubic metres per year over a period of 20 years. The gas will be delivered to PetroChina, which will then supply the consumer markets, mainly Beijing.

Total is a leading multinational energy company with 95,000 employees and operations in more than 130 countries. Together with its subsidiaries and affiliates, Total is the fourth largest publicly traded integrated oil and gas company in the world. Its businesses cover the entire oil and gas chain, from crude oil and natural gas exploration and production to the gas downstream (including power generation), transportation, refining, petroleum product marketing, and international crude oil and product trading. Total is also a world-class chemicals manufacturer.

(China Daily 10/25/2006 page21)

The Paris-based HEC has strengthened its efforts to provide more management training to help Chinese senior executives by teaming up with the State-owned Assets Supervision and Administration Commission under the State Council (SASAC) to start an EMBA programme in China.

"It is indeed the first time that the SASAC has selected a foreign business school to deliver an EMBA to its senior executives," said Joshua Kobb, director of International Programmes at Executive Education for HEC Paris. "Although SASAC was very demanding in their selection process, our quality of teaching and the fact that we are appreciated as providing added value over the US approach were strong points in our favour."

In addition, the fact that HEC is also working closely with Tsinghua University in other areas and is familiar with the quality and standards of Chinese teaching was also appreciated.

HEC brings the international perspective and the global mindset that leaders need to pilot their organizations in an increasingly complex global market, he said.

"Many of our participants come from companies that will become leading global organizations. So we need to help these senior executives understand the Western perspective; how we do business, how we make decisions and how we operate," the director added.

HEC applies international teaching methods and the curriculum teaches the same skills and issues it teaches to all of its executive programmes.

Facing a growing need for more executive education in China, HEC would also like to offer more company-specific custom-designed programmes in the country, an area in which HEC has significant experience. The institution has a long history in France and Europe and enjoys a strong international reputation.

"Though the EMBA programme targets mainly State-owned enterprises (SOEs), the SASAC has opened it to executives coming from private companies as well," said the director.

That is why the programme is customized in both the delivery format and the content. As teaching is in English, translation and interpretation are available. HEC makes use of local teachers to help bridge some of the communication and cultural differences. The content is clearly geared towards senior managers.

"Though we provide some of the specific skills they need, the EMBA is a generalist programme which aims to also provide the vision that leaders require to be successful," he said. "We are not teaching how to do business in China, but rather, what the Chinese need to know to do business on an international level."

Participants will learn Western accounting principals, strategic marketing, organizational behaviour, logistics and supply chain management and finance from the programme. Topics such as governance and change management will also be addressed. Business leaders and economists will also regularly address the class.

"As educators, our role is not to solve management problems but to provide tools and concepts to allow decision-makers to find their own solutions to problems they face," he said.

HEC does not impose one model of management. But with the keys HEC provides, managers will be able to make better decisions, in whichever situation they may find themselves.

In this regard, the SASAC will also address the situation and make improvements in SOE management.

"Private-sector managers will benefit from the programme's general management approach, and will create relationships with executives from other companies," he said.

"I think the challenges that SOEs may be facing, revolving around governance, performance management, change management and leveraging innovation are common to many companies, both SOE and private," he said. "So the programme is tailored to meet the needs of individuals from both."

"The experience of managers from private enterprises will certainly be beneficial to managers from SOEs. And private enterprise participants will appreciate the networking potential of all their classmates. I think this mix adds even greater diversity to the student body, and enriches the programme and the experience," he said.

It is true that, for some participants, the international approach to teaching, relying on participation, group work and discussion, is surprising at first. But the academic and professional qualifications of these participants are very impressive.

"The HEC team, including professors and myself, greatly appreciate everyone's openness and willingness to learn new things. We felt it important to maintain our approach," he said.

The EMBA programme in China is a rare opportunity for participants to better understand the Western mindset and to acquire international business skills. There is a need in China for this type of programme, and HEC is providing the highest quality training, he added.

(China Daily 10/25/2006 page21)

The bilateral events, the Year of China in France and the Year of France in China between 2003 and 2005, ended last September. However, cross-culture communications between the two countries has never stopped.

This year, the Festival Croisements presented more than 100 shows and exhibitions featuring French artists collaborating with Chinese counterparts in 10 cities in China from April 20 to June 11.

To the artists from both countries, it was an opportunity to share and exchange; to Chinese people, it was another treat to savour in relation to French culture and arts.

"The Year of China and the Year of France were very successful in both countries. Many people were involved and thousands of events were launched. We had a fantastic time working with the Chinese officials, artists and people from all walks of life. Therefore, we would like to extend the collaboration," says Pierre-Jean de San Bartolome, deputy director of the France Culture Centre in China.

He told China Daily that the specific idea of the Festival Croisements is to have French and Chinese artists working together.

"It is not difficult to invite French artists or ensembles to perform in China, but the impact of such tours are not as deep or good as the ones where the artists work together in forums, workshops or master classes for a time before showcasing the creation," says San Bartolome, one of the heads that co-ordinated the French side of the Year of France in China and the Year of China in France.

"The purpose is not only to showcase French arts and culture in China, but also to provide opportunities for people from both China and France to learn from each other in a variety of ways, to share and exchange."

The veteran culture official worked on the annual Asia-France Festival from 1989 to 1998, which had artists from Asian countries such as China, Japan, the Republic of Korea and India creating with those from France.

"Their different cultural and social backgrounds and life experiences produce inspiration when they work together," he added.

San Bartolome also revealed that as an extension of the Year of France in China, they would continue to launch Festival Croisements in China every spring.

Under the direction of the France Culture Centre and the Embassy of France in China, the two-month long Festival Croisements 2006 included shows of music, dance, theatre, circus and visual arts.

Musicians from both countries brought a variety of concerts ranging from classical opera to contemporary and fusion works.

In terms of classical music, the French director Jean Louis Pichon directed Shanghai Opera House to perform Bizet's "The Pearl Fishers" under the baton of Zhang Guoyong. The cast included Chinese tenor Zhang Jianyi, soprano Xu Xiaoying and baritone Yang Xiaoyong.

In Beijing, under the baton of its artistic director Tan Lihua, Beijing Symphony Orchestra gave a concert at the Forbidden City Concert Hall on May 21, playing Berlioz and Saint-Saens' pieces with the 28-year-old French organ player Erwan Le Prado.

In the second half of the concert, the orchestra played some parts of the Chinese opera "Peony Pavilion" composed by the French composer Hacene Larbi. Chinese director Ning Chunyan directed the play, which premiered in Paris in 2001.

As for the contemporary music, a couple of Chinese musicians collaborated with French artists to fuse and improvise music in live concerts.

Wang Lei and the French Dub band Hightone performed in Beijing on May 19, in Shanghai on May 20 and Guangzhou on May 21.

The Chinese flutist Li Shan, 28, gave the concerts Fusion/Tradition with French musician Mars (Olivier Nestelhut) who played the traditional Chinese two-stringed instrument erhu in Beijing, Shanghai, Wuhan, Xi'an, Dalian and Guangzhou.

Mars fell in love with the erhu by chance when he visited Shanghai in 1992. During that trip, he bought a Chinese erhu and began to practice the instrument on his own.

Dance

In terms of dance, the National Ballet of China presented the renowned French choreographer Roland Petit's "Carmen," "L'Arlesienne" and Act Three of "Raymonda" at the Tianqiao Theatre on May 5 to 7. Chinese ballerina Zhu Yan and Wang Qimin danced with the stars Manuel Legris and Benjamin Pech from Opera de Paris.

The collaboration between Roland Petit and the National Ballet of China was a highlight event during the Year of France in China. The 81-year-old master was deeply impressed by the dancers especially the ballerina Wang Qimin and fell in love with the company immediately. He even said that their performance of "Carmen" and "L'Arlesienne" were the best since he created them.

The other world-famous French name, the fashion designer Pierre Cardin initiated a song and dance show combining French chansons such as "Edith Piaf," "Jacques Brel," "Sous le ciel de Paris" and "La vie en rose" and Chinese ballet and contemporary dance. Cardin designed all the costumes for the show.

The French singer Gerard Chambre and his band gave a live show while Gaoyan Jinzi from the Beijing Modern Dance Company and Xu Gang from the National Ballet of China were commissioned to choreograph the show that premiered at Beijing's Century Theatre on May 12 and 13 and then toured Paris in July.

The popular French hip hop dancer and choreographer Najib Guerfi worked with Ma Qiang and Cao Peizhong from Beijing Modern Dance Company to create "Babel" and the show was performed in Beijing on May 25 and 26 and then moved to Shanghai on May 28.

Drama

In the theatre scene, the Paris-based Chinese director Ning Chunyan directed Eugene Lonesco's 1960 anti-Nazi play "Rhinoceros" with the cast from the China National Drama Theatre Company. The play was staged at China Children's Art Theatre from May 25 to 27.

Chinese director Wei Xiaoping joined hands with Michel Didym to present the French playwright Serge Valletti's work "Mr. Armand, Known as Garricha."

It's the story of how Mr. Armand, an obscure soccer player of the Marseille Junior Olympic team, saved the life of the greatest Brazilian soccer player of all time, Manoel Francisco dos Santos known as Garrincha, by refusing to face him at the stadium in June 1955, and of how he saved the whole Botafogo team at the same time.

Director Catherine Marnas worked with 21 students from the China Central Academy of Drama to present Moliere's play "Don Juan" from May 27 to June 5.

Exhibitions

In addition to the performing arts, China National Museum of Arts hosted three major exhibitions: the Treasures of Baccarat from April 21 to June 7, video and photographic works by the multifaceted artist Alain Fleischer from April 21 to May 7, and the photographer Brassai's works from May 12 to June 11.

The renowned French luxury brand, creator of crystal objects since 1764, Baccarat brings to China 300 masterpieces from its heritage - some of which have never be shown outside France.

Through three themes: Art and Light, Art and Design and Art and the French Way of life, the scenographer Jean Oddes designs the layout of the exhibition especially conceived for the Beijing Museum of Fine Arts.

Alain Fleisher's works were exhibited at Guangdong Museum of Arts from May 16 to June 11 and some of his videos were shown at a joint exhibition called China-France at Beijing's Dashanzi Arts Festival from April 29 to May 7, together with works by young filmmakers from France's Fresnov National Contemporary Art Studio and China's Central Academy of Fine Arts.

At Beijing's Guozijian, the China Imperial College, the exhibition "Memory and Oblivion" running from June 10 to July 10 presented the works of Braco Dimitrijevic, the 56-year-old French artist of Yugoslavian origin and a master of conceptual art, and works of Huang Yan, 40, a famous Chinese contemporary artist.

Both work on the theme of memory, one by integrating original masterpieces in his installations, while the other uses the body, more specifically the face, which he paints in the Chinese tradition.

(China Daily 10/25/2006 page22)

"The visit to China by 400 French youths is more important than the pursuit of 100 Air Bus aeroplanes," Premier Wen Jiabao pointed out, referring to the Sino-French Youth Exchange Project.

On his visit to France last December, Wen paid special attention to the youth exchange between the two countries.

He and President Chirac reached an agreement that the two nations would each send 400 youths to France in 2007 and to China in 2006, to strengthen communication among the young people.

The bilateral visit marks the largest-scale Sino-French youth exchange activity in two decades.

It is without precedent in creativity, and continues with the fruits of the Cultural Year of China and France. Also, the project is the first of its kind between China and European countries over the past few years.

Five teams of youth representatives between 18 and 35 in the area of arts, economy, technology, science, social organization and politics will get to know each other and deepen mutual understanding in a week's time.

The event is dependent upon collaborations of the local governments and higher educational institutions of both sides. It has meanwhile gained the support of French enterprises.

This year, within the framework of the programme, 400 French youths will visit China to further improve their knowledge of the country. They are working with and building up contacts with Chinese peers and authorities in respective circles.

The project in China took its first step successfully a few months ago, when 100 French youths involved in the arts arrived in China and inaugurated the two-year-long mutual exchange.

Between June 2 and 11, they toured Beijing, Hangzhou, capital of East China's Zhejiang Province, and Shanghai. They were introduced to the pictures of different historical periods of the three cities, which weigh a lot in arts and life style in ancient and modern China.

The French youths were fascinated with the rich cultural heritages and antique architecture. Also they showed great interest in China's local operas, including Peking Opera and Yueju Opera.

The conversations on stage arts and techniques wound up with the curious guests putting on amazing costumes and learning from Chinese opera actors.

In addition, the young people shared their views on fashion and modern life. Coming from one of the world's fashion centres, the French recognized Shanghai girls' outstanding taste in vogue and boldness in the colour selection.

In July, another 100 promising French entrepreneurs at an average age of 28 carried out explorations in China.

Divided into three groups, they sought collaborative and business opportunities in the aspects of consumer products, the processing industry of agricultural products and biotechnology, information technology and engineering.

They received a warm welcome at major Chinese enterprises in Beijing, Shanghai, Nanjing, capital of East China's Jiangsu Province, and Shenyang, capital of Northeast China's Liaoning Province. Since most of them were in China for the first time, they had high expectations of the Chinese market.

The trip provided them glimpses into the local commercial system and market conditions, and cultural differences between the East and West.

It laid the foundations for future co-operation and an entrance to the Chinese market and consumers.

This month, the other two teams of 200 social workers and scientists will arrive. The exchanges will mainly focus on sanitary and medical areas, social development, environment and globalization.

Proposed by the Chinese Government, a delegation of 20 French politicians will soon visit the country, too.

The project in France is scheduled in 2007 involving 400 Chinese youth engaged in similar professions.

Philippe Guelluy, French ambassador to China, said that the youth programme is an ambitious project, and it flips to a new page of Sino-French all-around co-operation.

(China Daily 10/25/2006 page22)

In the eyes of Serge Dumont, a French businessman who has witnessed China's rapid development, an increasingly important issue Chinese companies should be aware of is the country's image and how it is perceived by foreign countries.

"When expanding overseas, Chinese senior executives are rightfully proud of the extraordinary economic achievements China has made but often wrongly assume that the world perceives China the way the Chinese do," said Dumont, explaining that this is one of the reasons why some Chinese companies meet obstacles in foreign markets where they expand or try to acquire companies.

Serge Dumont first went to Taipei to study in 1978 at a time when Taiwan was enjoying a major economic boom.

And he witnessed a similar rise on the Chinese mainland in the mid 1980s.

"Like a few other foreigners, I have been privileged to be in China at this unique historical time, when this country's place in the world changed so dramatically," Dumont said.

Serge Dumont was very actively involved during the Year of France in China which took place in 2004-05. This major programme, initiated by the Presidents of China and France, was unprecedented in its nature and scale.

He was asked to advise the French Government on how to involve the Chinese private sector and mobilized 22 Chinese leading companies and influential businesspeople to support the event.

"I immediately realized the short and long term benefits the two countries could derive, on all levels, from a programme of this nature," Dumont said. "Understanding each other's culture is the best foundation to establishing solid and lasting relationships."

In 1985, at age 25, he founded a strategic communications consultancy and rapidly acquired many Fortune 500 clients, including several famous French brands, which later became part of an American public relations group.

"Starting the first foreign invested communications business in China in the mid 1980s was not always easy. China was only then starting to build a modern legal system, trained human resources in our field were virtually nonexistent and the infrastructure not very suited to the needs of communications businesses."

"But we enjoyed having to be constantly challenged to find innovative ways of doing things, as there was no model to turn to, and I never regretted the time I have spent in China."

He is now often referred to as "founder of the communications industry in China" for his unique and pioneering contributions.

In January this year, he joined Omnicom Group Inc, the world's leading advertising and marketing services company as senior vice president and president of Asia Pacific business.

"I feel that the new breed of highly talented Chinese senior managers which has emerged over the last decade has a major role to play as Chinese enterprises are facing the complex challenges of entering developed markets and building global brands," Dumont says.

As a successful businessman, he has always felt it important to be deeply involved in philanthropic and cultural activities.

For example, in 2003 he conceived and organized China's first high-level celebrity charity event to raise awareness of HIV/AIDS. He has recently been given the prestigious global mandate by the United Nations of "Special Representative" of UNAIDS.

He was the first foreign member appointed to the board of trustees of the influential China Youth Development Foundation.

A few years ago, he established a private scholarship programme with the elite Tsinghua University to meet the growing need for qualified communications professionals in China.

"I truly feel privileged to have been in the right place at the right time," he adds.

(China Daily 10/25/2006 page22)

Turin Olympic Stadium, February 11, when the world's largest winter sports event the Olympic Winter Games unveiled the curtain, a young Chinese focused his attention on several computer screens in front of him, but he was not watching the sports gala.

The 24-year-old Zuo Nan had no time to enjoy the grand opening, although he was just a couple of metres from the sports field, because he had a more important task to do: manage the technical support centre for the Olympic Games.

At Atos Origin, the Worldwide Information Technology (IT) Partner to the Olympic Games, people like Zuo are called voiceless heroes, serving those glamorous athletes and billions of people watching the games.

While the mission of Atos Origin, the Worldwide Information Technology Partner for the International Olympic Committee (IOC), is to serve all participants to the Olympic Games from 2002 to 2012, it is largely a voiceless hero; one of its goals is to have its voice heard in the Chinese market with an elevated profile and technological strength from the Games.

"This Olympic sponsorship will help us showcase the company's capabilities and establish strong brand awareness in China," said Bernard Bourigeaud, chairman of the Management Board and chief executive officer with the Europe-based IT service provider.

As the Beijing 2008 Olympic Games is less than 700 days away, Atos Origin, the worldside IT sponsor, has accelerated its pace for the first Olympic Games in the world's most populous country.

The leading international IT service company in Europe began to prepare for the Games four years ago, as China wants to make the event the best in history and Atos Origin also wants to show its customers and potential clients in China its capabilities.

At present, Atos Origin, which manages systems from sports result reporting, broadcasting to audience identity verification, and uses a sophisticated system developed by the company itself to protect information, already has some 50 people working together with organizers, other Olympic partners and sponsors, and the team will grow to more than 400 in 2008.

Bourigeaud said in an interview concurrently with the visit of French President Jacques Chirac to China that considering the size, complexity and popularity of each Olympic Games, it is always a challenge at each session, but in Beijing, there are some new challenges.

The Beijing Olympic Games has three official languages and for a Europe-focused company like Atos Origin, Chinese can be one challenge, said Bourigeaud.

For many engineers, familiar with English and French interfaces of IT programmes, now they have another demanding task: to face a Chinese version.

To cope with that, Atos Origin's Olympics team in Beijing hires one Chinese teacher for each of the non-Chinese-speaking employees.

As China is going to introduce many new technologies into the world's biggest games in 2008, the complexity of IT services will be more demanding.

However, Bourigeaud believes it will just provide a good platform for Atos Origin to demonstrate its technological strength to the world and especially its customers in China.

"If we can do what we do for the Games, we can do it for any other business," he said.

"The expertise that we gain from delivering this complex and time-critical project will be transferred to other global clients that are looking to us to deliver similar high-performance IT infrastructures where real-time data is paramount."

China, already one of the biggest IT hardware makers and buyers in the world, will see the demands of organizations from hardware to software and services, a globally proven migration roadmap.

Boosted with an elevated profile as an IOC Olympic partner, Atos Origin is gaining increased recognition from its Chinese customers.

Today, Atos Origin has already become a solution supplier to the Bank of China and China Construction Bank, as well as to the control system of gas in Xi'an, an ancient Chinese capital in Northwest China's Shaanxi Province.

China has become a strategic market for the European firm in its blueprint, especially in the Asia-Pacific region.

Atos Origin has set a goal to grow the share of its Asia Pacific region from the current 4 per cent to 10 per cent and in the first half of this year, employment growth in the region was the highest among all its regional markets at 13 per cent.

The total number of employees in the Asia-Pacific region was 2,850 and more than 1,000 of them were in the Chinese mainland, Hong Kong and Taiwan.

Bourigeaud said that his company did quite well in China in its three traditional business sectors: card payment services, ERP solutions in the manufacturing industry, and IT infrastructure operations and management.

It is also looking at other opportunities in new business segments, such as professional services from IT to banking and telecommunications, which have a huge demand in China, as well as areas where the company enjoys a global competitiveness.

(China Daily 10/25/2006 page23)

Long perceived as a sport for the rich, sailing is no longer only for wealthy nations. At the upcoming 32nd America's Cup, a major international sailing event, China for the first time in history will make an appearance in this prestigious event.

Altogether 12 fleets from 10 nations, such as the United States, France, Germany, Italy, Australia, Spain, and New Zealand will compete at the event in Spain, the final stage of which will be in 2007, April to June.

The Chinese team will represent the world's fast-growing nation in a field that nobody believed three years ago it could be involved in.

The first Chinese boat for the event is under construction in Dongguan of South China's Guangdong Province, and is scheduled to leave the boatyard next month, and will be ready to sail in Valencia at the end of January.

The initiator behind such a historical move is a Frenchman, Nicolas Ajacques, managing partner and chairman of NewBridge China, a firm that aims to develop Sino-French economic, cultural and sport exchanges.

When Ajacques started marketing the idea three years ago, no one believed it would be possible even in 10 years' time. But the French businessman has a strong belief that yachting, with the theme of nature, environment, team spirit and high technology, will catch the attention of the growing number of China's elite.

"I believe yachting is an activity which will develop fast in China, driven by the availability of leisure time for more and more people and the attractiveness of being close to nature," Ajacques said.

"Development of the infrastructure is fast, with several marinas under construction, and boats starting to be manufactured in China. Development of sailing is likely to come next, as it is a new sport, but it is driven by the appeal of China's elite for an activity full of tradition," he continued.

A fantastic idea was formed, and Ajacques needed money to realize the idea. Budgets for the America's Cup are sky-rocketing, with over US$100 million announced by many big teams. Ajacques thinks the budget for the Chinese Team is more modest, with an overall expectation of US$20 to 25 million.

Where is the money from? In order to develop the project, Ajacques initiated many contacts in China, with the China Yachting Association, the Qingdao city government and several potential sponsors.

It is on this basis that he met Wang Chaoyong, president of China Equity Group Inc, who seemed to have a similar project. "When we met, we were amazed to see we had reached very similar conclusions on what the project should be: a real Chinese challenge, based in Qingdao, host of the Olympic sailing event and driven by an experienced foreign team to accelerate China's entry into this new field," Ajacques said.

He then suggested that partnering with LE DEFI, an experienced French team he knew very well, was the best approach to give birth to the project at a time when no one believed it could take place.

Discussions went fast and the two businessmen concluded the joint venture in just a few months. Since then several companies have joined to support the programme: Tag Heuer, the famous watch maker, Lladro, the largest employer of Valencia where the Cup will take place, Chivas, the famous whisky brand of the French group Pernod-Ricard, and Neocles, a provider of software solutions.

So far, the total sponsorship he has raised is around US$15 million, an amount he expects will grow in the coming months if on-going discussions conclude successfully. "We would be particularly pleased if more Chinese companies joined the team to support their national flag in this competition," Ajacques said.

The team has attracted six to seven Chinese sailors, all from the Chinese Olympic Team. The team also includes sailors from Singapore and Malaysia.

The French team has brought the core of the crew, including the helmsman and tacticians, critical positions that require years of high-level training.

Boat design and overall conception and racing technologies are brought by the French, with the objective of transferring this technology in the long term to the Chinese team. One key example is the construction of the boat, which is currently taking place in Dongguan. Western experts are on the spot to ensure technology transfer and the boat has just been granted its series number, 95, which certifies it complies with the very strict Cup specifications.

"The whole project is a perfect example of positive co-operation, putting together the best of two nations, China and France," Ajacques stressed.

The Chinese team is a long-term project, and Ajacques believes the team will participate in every America's Cup, and its record will improve each time.

(China Daily 10/25/2006 page23)

One of Africa's smallest and most densely populated countries Rwanda expects to double its economy over the next 15 years and its economic growth in the coming decade will be powered by taking advantage of its strategic location to become a regional trade and investment hub.

As part of the government's Vision 2020, Rwanda has set itself the target of moving from a per capita gross domestic product (GDP) of around US$250 to US$900 by 2020, a task that will require a seven-fold increase in GDP from the current US$2 billion.

And the way to do that, says Vincent Karega, minister of Commerce, Industry, Investment Promotion, Tourism and Co-operatives, is a two-pronged strategy of attracting direct foreign investment and boosting exports.

A member of COMESA (Common Market for Eastern and Southern Africa), Rwanda already provides access to 400 million potential consumers. It is set to join the East African Community later this year.

The country has become one of the most open economies in Africa, doing away with most tariff barriers in the process.

"We are positioning Rwanda as a market for the region," says Karega, pointing to the country's sound government, lack of corruption, well-educated workforce and rapidly expanding high-tech infrastructure.

The commerce ministry is working with other public and private-sector institutions to create a stimulating, flexible and dynamic business climate. The aim is to create a base for overseas investors to set up partnerships with small and medium-sized enterprises.

"For the last three years, the ministry has been implementing new policies to attract investment, promoting the private sector by creating the right legal environment and offering businesses support through other institutions," he explains.

Public-private partnerships, for example between the BRD development bank and the private sector federation CAPMER, will lay the foundations for future growth, says Karega.

Karega says the country is proving increasingly attractive to growing numbers of Chinese investors, keen to enter the burgeoning markets of Africa.

"The Chinese need to sell, and we are developing an export processing zone to make Rwanda a redistribution point. With their skills and knowledge of local markets, Rwandans make the perfect local partners," says Karega. He points to opportunities in energy, information and communications technologies, infrastructure, agriculture and food processing, mining, and tourism.

"If we look at our economy, 40 per cent is generated by agriculture, another 40 per cent by the service sector, and the rest by industry," he says. "The private sector's contribution is invaluable, but what we also need to ensure is that the private sector becomes vibrant enough to influence the labour force to produce the right products for the market. We need to look into high-value, high-yield crops, for example."

Around 90 per cent of the population still depends on agriculture, and the sector contributes almost three quarters of export earnings. To create more rural wealth, boost export earnings, and meet the country's own food needs, the sector needs to move away from subsistence farming to producing high-value crops.

Tea and coffee offer tremendous potential, and are being privatized, pulling in key foreign investment. In February, the government sold a 51 per cent stake in the country's biggest coffee processor and exporter, Rwandex.

This move will see the creation of new coffee washing stations throughout the country, and strengthen the quality of Rwanda's coffee exports.

Karega says Chinese investors are particularly suited to areas involving added value, such as the coffee and tea sectors, and he looks forward to what he calls a "win-win situation" with China and the rest of the world, based on fair trade among regional economic blocs that see each other as partners, not competitors.

The commerce ministry is also working hard to attract further private investment to the tourism sector.

Rwanda's star attraction is undoubtedly its gorilla population, which makes up more than half of the world's total population. The best way to protect this precious resource, and to create a long-term, sustainable sector is to focus on low-volume, high-yield tourism, says Karega.

Highlighting what he sees as the different attitude of the Chinese to doing business, Karega says: "China doesn't have a neo colonial attitude, and this balances our relations with Europe."

(China Daily 10/13/2006 page17)

In 1994, as genocidal violence swept Rwanda, a four-star hotel in the capital, Kigali, became a sanctuary.

That hotel, the Mille Collines, is now known around the world as a symbol of hope, thanks to the 2005 film, Hotel Rwanda, which told the incredible story of how its then-manager Paul Rusesabagina, risked his life to save around 700 people, mainly Tutsis, who had taken refuge there from the Hutu militias outside the gates.

Little remains to suggest the terrible ordeal of those 100 days when up to 10 people shared a room, and the swimming pool was their only source of water.

Once again, guests can dine at the hotel's terrace, overlooking the leafy capital.

"Yes, the hotel attracts people who are curious to see where the events portrayed in the film happened," says General Manager Patrick Knipping, who took over when the hotel was sold last year to Mikcor Hotel Group by Sabena Hotels for US$3.2 million. Sabena Airlines sold the hotel after going bankrupt and ending flights to Rwanda.

"We have 112 rooms and we offer all the international facilities you would expect. We try to ensure that the hotel is very welcoming. We are centrally located in the city and have become the meeting place of Kigali. Our executive chef is from Belgium and offers international cuisine. We have well-equipped meeting and conference rooms, as well as all the facilities of a world-class hotel such as a fully equipped business centre (after renovation) and of course fitness and health facilities," explains Knipping.

A full renovation of the 112-room hotel is planned for this winter and will increase the number of suites and further improve the quality of the rooms.

As one of the country's premier hotels and due to its strong reputation, the Mille Collines could play an important part in rebuilding Rwanda's tourism industry. Shortly after it took over, the new management held a five-day tour in the country to study the tourism potential of the country in conjunction with a local tourism firm.

Mikcor Hotel Group is set to inject about US$770 million in the country, targeting tourism through hotels, construction of estates in Nyarutarama, and the banking sector.

Mikcor has a chain of investments in South Africa involved in prospecting oil, communication, power line connection (broadband) and real estate.

Sabena said at the time of purchase that none of the staff would be fired. "I would rather lose my life than see the people here lose their jobs," said Christian Van Buggenhout, president of the trustees administering the bankrupt airline.

Another film set in the hotel is now being made based on Canadian writer Gil Courtemanche's novel A Sunday by the Pool in Kigali, which tells the story of a foreign journalist's relationship with a Tutsi waitress.

(China Daily 10/13/2006 page17)

Long-term producer of commodity-grade coffee, Rwanda is implementing new initiatives to modernize the coffee sector aimed at increasing production and quality, aiming to improve profits for the 400,000 families that depend on the coffee sector. This year, the Ministry of Agriculture estimates a crop of around 25,000 tons, which will bring in around US$3 million for the country's growers.

Ephrem Niyonsaba, director of the Rwanda Coffee Board, is keen to work with Chinese investors to produce and distribute coffee. He says there are big opportunities for companies who manufacture pesticides and fertilizers to set up in Rwanda.

"The cost of importing is a big cost for us. We would like to source these materials in China which could be cheaper than sourcing them in Europe. We know that the Chinese can supply these at a cheaper price. I would like to look into China supplying equipment for the whole coffee sector. Currently we source from England, Kenya and India. We already import some equipment from China but not much," he explained.

Niyonsaba says Rwandan coffee growers are open to partnerships and joint ventures with the Chinese for exports. "Our coffee is of excellent quality and one of our challenges is in marketing and selling and we would like to work with the Chinese in this area to be able to export to all parts of the world. I'm sure the Chinese could work with us in promoting our coffee worldwide."

Rwanda has already begun promoting its coffee in China, but as Niyonsaba points out: "The market is fairly difficult to penetrate and thus we need a Chinese partner to help us with this. We don't know the exact requirements of the Chinese market and the Chinese could help us with this."

Rwanda has produced commodity-grade beans for many years, but has only recently begun to develop a gourmet coffee industry and there are also possibilities to supply the specialty and quality coffee markets.

"Rwanda is a producer of quality coffees and our goal is to increase the production of quality coffees. We don't want to compete in terms of quantity, but in the quality of our coffee," says Niyonsaba. Rwanda already supplies the American market, including Starbucks, a firm known to be extremely demanding regarding the quality of the coffee.

"My vision is to transform the Rwandan coffee industry into the best supplier of coffee in the world: this is the only way to make sure this sector contributes the most to this country. While coffee prices fluctuate greatly, prices for top-quality coffee stays fairly stable," says Niyonsaba.

Long history

Rwanda's coffee industry dates back to the beginning of the 20th century, and reached a maximum production of 43,000 tons of green coffee in 1986. During the years that followed, from 1987 to 1993, production slumped to an average of 30,000 tons of green coffee.

After the war and genocide in 1994, the situation became worse and production fell to 55 per cent of that of 1993, reaching only 14,268 tons in 1998.

With the implementation of the new coffee sector development strategy in 1998, the situation has improved dramatically.

In accordance with the government's Vision 2020, the Rwandan coffee sector has steadily broken away from the cycle of low production-low quality and has focused on a strategy towards competitiveness in the international market.

Rwanda offers ideal conditions for growing Robusta and Arabica coffees, and the best-known type from the country is Maraba Arabica Bourbon, appreciated for its rich, deep flavour. In the same way that Jamaica's Blue Mountain has become synonymous with high quality, Rwanda's Thousand Hills brand is fast becoming a household name in markets such as the United States.

Investing in quality

If production and quality from the coffee plantations continue to improve at present rates, Rwanda could produce at least 37,000 tons by 2010, of which 60 per cent would be fully washed, and earn more than US$65 million.

Niyonsaba highlights the importance of public/private partnerships in executing the defined programme. Public organizations alone cannot achieve the intended objectives.

Once the actions to be undertaken have been defined, the different ministries concerned can then be involved in collaboration with the different partners of the private sector.

The transformation of Rwanda's coffee sector is a long-term process, but the opportunity exists for it to have a real impact on the different strata involved in the sector at the national level, especially for coffee producers.

(China Daily 10/13/2006 page17)

Rwanda is currently undergoing Africa's most ambitious privatization campaign. Indeed, the scheme is among the most ambitious and systematic anywhere on the planet.

The programme began in 1997, and with less than a year before the process of selling off State companies is due to be completed, barely 10 large enterprises remain in government hands.

In the process, a dynamic, competitive and flexible economy is beginning to take shape.

Over the last decade, more than 40 companies out of an original 74 have been divested, ranging from tea plantations, banks, telecommunications firms, the coffee exporter Rwandex, the Soprotel hotel company, pharmaceuticals firm Labophar, and even State publisher Imprisco.

Manasse Twahirwa, executive secretary of the Privatization Secretariat, explains that revenue generated by the sale of State companies frees the administration to focus on other areas of long-term economic planning.

"The government will not be involved in providing services and products that can be delivered more efficiently by the private sector," says Twahirwa.

Instead the State will continue to act as a catalyst, ensuring that infrastructure, human resources and legal frameworks are geared toward stimulating economic activity and private investment.

This has involved creating an enabling environment for investment and businesses, hand in hand with setting up of institutions such as the Rwanda Investment and Export Promotion Agency (RIEPA).

Rwanda's membership of the East African Community, expected to begin over the coming year, will open up new markets for the country. But as Twahirwa points out, to fully take advantage of the potential of access to this common market, the business sector will need to improve its competitiveness.

A viable private sector able to drive sustained economic growth is key to the government's Vision 2020 programme. Although foreign direct investment is being actively encouraged, Twahirwa points out that the country also needs to create conditions that will allow the development of a middle class.

The private sector is having a growing impact on the overall growth of the country. Tax revenue now makes up 13 per cent of gross domestic product (GDP), and as Twahirwa points out, the bulk of this comes from the private sector.

Growing relations with China

"Rwanda and China have enjoyed good co-operation for many years, something that will continue we are totally open to Chinese investors," says Twahirwa, adding that the mining and tourism sectors probably offer the best opportunities for Chinese investors.

But he says Chinese investors have been slow to take part in the privatization process. "I think Chinese people know about Rwanda, but the companies privatized to date have not been of huge interest to them they need to be informed better about Rwanda."

Twahirwa says the mineral sector is probably the most interesting to Chinese investors.

With identified supplies of cassiterite, wolframite, columbo-tantalite, gold, amblygonite, beryl, and semi precious stones such as topaz, corundum, amethyst, chiastolite, opal, agate, flint and rubies, mineral commodities used to contribute around 10 per cent to export earnings before the genocide.

Traditionally run by small-scale local operations, the mining sector remains largely untapped. The government wants to attract foreign investors, particularly to carry out exploration. And interest from South African and Australian players is rapidly changing the face of the industry.

Tourism also offers tremendous potential, says Twahirwa. The task now is to make a concerted effort to market the country abroad, something that remains a challenge, given the terrible events of the mid 1990s.

But as he points out: "The country has moved on from that era. Investors who have come to Rwanda are really enthusiastic about the country."

To further promote its tourist sector, a number of formerly State-owned hotels, including Hotel Diplomate (now the Intercontinental), Hotel Izuba on Lake Kivu, and the Hotel Akagera, have been renovated and either privatized or put under private management.

Five regions where significant infrastructure is already in place have been identified as priority areas for tourism investment.

After decades of stifling central planning, followed by the catastrophic genocide, Rwanda is a country that is embracing the private sector with deliberate policies and enormous enthusiasm.

(China Daily 10/13/2006 page17)

The past decade has seen the launch of a programme to rebuild and extend Rwanda's infrastructure, following the widespread damage inflicted to its roads and power and water networks during the genocide.

Infrastructure Minister Stanislas Kaman highlights the many investment opportunities in a wide range of infrastructure projects communications, public buildings, electricity, drinking water supply and sewerage.

Kaman says the long-term objective is for the country to become a transit area for the ports of Mombasa in Kenya, and Dar es Salaam in Tanzania.

"We have two classic corridors the northern corridor and the central corridor and both are operating well but we need funds to make sure the corridors are kept in a good state," says Kaman.

"A Chinese road and bridge company has been here and is doing a good job," he says. "There is potential for other operators from China."

Other transport routes

The government is also looking for partners to build a railway line from Kigali to the Tanzanian inland transport depot of Isaka.

Rwanda would then have rail access from the capital to Dar es Salaam.

"We will soon be starting a study, but we are also looking for potential investors to get involved. Currently we have a joint co-operation mission between China and Rwanda and this is one of the things we shall be discussing with them," says Kaman.

"We are not talking about this railway just servicing Rwanda, but all the Great Lakes countries."

Waterways

Although landlocked, Rwanda aims to make use of its lake system, particularly Lake Kivu which borders the Democratic Republic of Congo (DRC).

"Lake Kivu has huge tourism potential and is also important for the coffee, brewing and cement industries," says Kaman. "We need to ensure that there is a permanent lake transport system. In the past we had small ships but now we want to acquire a number of ships for cargo, tourism and passenger transport.

"This is a sector that needs investment and could be an opportunity for Chinese investors."

Aviation

Due to its rugged, mountainous terrain, Rwanda depends on aviation. The airport at Kigali has been upgraded, and the government is looking into building a new facility about 50 kilometres from Kigali. "This would answer our aviation needs and fits into the plan to make Rwanda a regional hub for commercial cargo distribution," says Kaman.

"I estimate that it shall be completed in about five to 10 years."

The government is also looking to upgrade the country's regional airports. Flag carrier RwandaAir is currently being prepared for privatization and the government is looking for partners.

"We are totally open to foreign investment in the civil aviation sector. We would welcome any Chinese businessmen who want to talk with us at this stage," explains Kaman.

Energy

Long over-dependent on hydroelectric power, Rwanda began diversifying supplies after low rainfall in 2003.

Energy and Communications Minister Albert Butare explains that the government's current big project is a methane gas plant, which by the end of next year should be generating around 30MW.

"The energy sector is open to Chinese investors," says Butare. "So far we have two Chinese companies looking at hydro projects. We think methane or geothermal would be interesting to a Chinese investor," he says.

(China Daily 10/13/2006 page18)

The first African nation to implement a long-term information and communications technology (ICT) programme, Rwanda is taking measures to become a regional communications hub. It already has Africa's highest density of VSAT terminals, and has been a pioneer in installing a fibre-optic network that will carry its high-speed telephone, Internet, and television services throughout the country. The goal is to enable every household to have a mobile phone within the next two years.

The country aims to become a knowledge-based economy by 2020, a transformation that will be driven by ICT.

"We see ICT as an instrument supporting our social and economic development," explains Albert Butare, minister for Energy and Communications. "As part of the Vision 2020 programme, we began working on a framework for development through ICT back in 1998," he explains.

In 2000, just one school in the country had a computer, and barely 100,000 people out of a population of 8 million had phones. Six years later, almost 2,500 schools now have at least one computer, and there are Internet cafes throughout the country. More than 30,000 people now have a mobile phone each.

Now the State electricity utility is implementing a US$35 million project to lay fibre-optic cables along its power lines, connecting every school in the country to the Internet.

"ICT is our engine of growth, national prosperity, and global competitiveness," adds Butare. Besides being the source of innovation, ICT is also seen by the government as an instrument of empowerment in that it will give Rwandans the business, scientific, commercial, and marketing information to make the country a global competitor.

The government has implemented a National Information and Communication Infrastructure (NICI) plan, through the Rwanda Information Technology Authority (RITA).

Butare explains that phase two of NICI, which runs to 2010, focuses on human capacity building, infrastructure, e-government, education, community access, and private sector facilitation.

"Our main resource in Rwanda is our people, and thus all tools and instruments are dependent mainly on human resources: We feel ICT is the best instrument for this. Plus we have seen that private sector involvement is key and we encourage them to fully take part," says Butare.

Chinese firms active

As part of the bid to provide each household with a mobile phone, the government is now working with China's ZTE to build phone and other ICT components.

"We are also working with the Chinese on video conferencing, particularly looking at this within the scheme of e-government and de-centralization within the ministry of local government and within the Justice Ministry," says Butare.

Under its e-government policies, the administration aims to give people easy access to information, while improving the speed the population is able to use public services. Greater use of ICT will also improve efficiency of governments. Finally, it wants to enhance links between the private sector and all levels of government.

The e-government project document outlines the short to medium-term goals as combining applications that enhance capabilities and information dissemination with consolidating government services by constructing systems to eliminate duplicative processes, improve inter-operability, reduce redundancy, foster integrity, and provide measurable improvement in performance.

ICT use is spreading into government, finance, the private business sector, health, and education. High-tech initiatives include the use of ICT for electronic marketing of agricultural products, along with a crop mapping system, while hospitals are implementing telemedicine to supervise operations and help control AIDS. The banking system in Rwanda means that a nationwide electronic card payment system is spreading fast, transforming the way that customers handle their money.

Chinese experience

Rwanda's government has learned a lot from the Chinese about the use of high technology to power economic growth.

"I have been to China and it is moving extremely fast in ICT. They have just moved from the stage we are currently at, so it is very easy for us to follow them," says Butare.

Next year the mobile telephone market will be opened up, with more licenses being awarded.

Opportunities for investment are in areas such as software and hardware development, broadband fibre-optic infrastructure, as well as value-added services such as call centres and back-office operations, along with mobile phone assembly.

The country will soon be part of the East African submarine cable system, and with its low telephone tariffs will be able to offer the levels of services required for offshore banking and other financial and services industries.

Butare says that there is tremendous potential for investment, such as joint ventures in ICT parks. His goal is for a software export market of between US$50 and US$100 million by 2020.

(China Daily 10/13/2006 page18)

Culture is often regarded as a nice-to-have addition besides economic and political co-operation. It is all the more remarkable that, during German Federal Chancellor Merkel's first visit to China in May 2006, China's Premier Wen Jiabao and Ms Merkel agreed that education, culture and science would be priority sectors to further deepen the already excellent relations between the two countries.

This may be easier said than done. The cultural exchange between China and Germany has already experienced a previously unimaginable upturn.

Performances by German orchestras in China are just as common today as Chinese films are in German cinemas. Contemporary Chinese avant-garde art is sold at top prices in international art markets, and to exhibit in Beijing or Shanghai ranks high on the wish lists of the international artists' and collectors' elite.

China's cultural scene today is much richer and more diverse than 20 years ago. Nowadays, China reaches out more actively worldwide in order to foster the interest in its language and its culture in other nations, notably by establishing Chinese cultural centres and by promoting Confucius institutes. The Chinese Government recently identified culture as a "major task" of its foreign policy, pointing out that China must spread its culture abroad to let the world better understand the country.

The Goethe Institute in Beijing was set up as early as 1988 - actually the first foreign cultural institute in New China. While in the beginning the institute was only allowed to hold language courses, such restrictions are now history. The Chinese Cultural Centre in Berlin is scheduled to open in spring 2007. At the same time, Confucius institutes are mushrooming, and one can expect about seven of these to become operational in Germany by the end of this year. As Confucius said: "Is it not a delight after all to have friends come from afar?" Whereas Confucius Institutes are a matter of co-operation between universities, they receive financial support and political backing by both governments - a very future-oriented model of public-private partnerships.

Language is indeed a key factor in deepening exchanges. Introducing Chinese as a foreign language in German schools has just begun.

And further joint efforts are badly needed to spread German as a foreign language in China's middle schools; statistics show that the number of Chinese university and middle school students learning German is lower than in Japan and only a fraction of the number in Russia.

History of academic co-op

Academic exchanges between China and Germany started in the early 20th century. As of today, there are over 300 co-operation agreements between German and Chinese universities, supported and co-ordinated by the German Academic Exchange Service (DAAD).

With almost 25,000 students, Chinese students have become the biggest group of foreign students in Germany. Many of them have in the meantime returned to China to take up important academic and administrative positions.

Just as important are the many thousands of scientists from all fields who have created a dense network of academic and personal relationships. In 2005, 56 German universities and colleges were conducting joint research and study programmes with Chinese partner institutions. The Tongji University with its Chinese-German College in Shanghai and the Sino-German Centre for Research Promotion in Beijing are outstanding examples. The Max Planck Society operates a joint research institute with the Shanghai branch of the Chinese Academy of Sciences.

An outline of Sino-German cultural exchanges would be incomplete without mentioning sports. Just two examples: The recent football world-cup in Germany was followed with enthusiastic interest by hundreds of millions of Chinese, and the orderly and friendly atmosphere greatly strengthened international confidence in the German people as a peace-loving nation; the German Football Association regularly invites Chinese football coaches for further training. Secondly, sailing: China, as the host of the 2008 Olympics, is faced with the challenge to set up sailing infrastructure in Qingdao, and the north-German city of Kiel - host of many Olympic water sports competitions - is proud to provide advice in this regard.

The cultural relations between China and Germany will hopefully reach one of their peaks in 2007 and 2008, when a series of "German Weeks" will be carried out in several major Chinese cities, shedding light on many aspects of German culture and way of life. Furthermore, a "German Information Centre" (GIC) is being established within the German Embassy in Beijing, as one of only three such centres worldwide.

The new GIC and the Goethe Institute will bundle their efforts to provide information for Chinese Internet users on more broadly based, professional and attractive websites.

Future relations

Looking towards the future, the challenge is not only whether cultural relations can catch up with the breathtaking speed in which our economic co-operation has developed. The quantity of cultural and educational exchanges alone does not automatically lead to mutual acceptance and understanding. China and Germany (as well as other Western countries) still remain sort of "foreign" to one another in certain cultural areas.

Both sides' perceptions of one another continue to be unavoidably affected by stereotypes, cliches and prejudices to some extent. Therefore in line with the changing nature of our economic relations - we need to make the transition from "export" to "exchange" and then to "co-operation" also in the cultural field.

History indicates that a rapid increase in encounters between people from different nations without a better understanding of the respective culture can even create the potential for conflict.

But according to Johann Wolfgang von Goethe, the danger of serious misunderstandings seems not too great between China and Germany. As he pointed out in his letter to his friend Eckermann in 1827, "the Chinese people think, act, and feel almost exactly like we do, and you can very soon feel like one of them " So it seems that, though geographically far away from each other, our two countries have far more in common than we realize.

(China Daily 09/13/2006 page17)

Chinese Premier Wen Jiabao's visit to Germany is "an important contribution" to current German-Chinese dialogue, said a senior German diplomat in relation to the significant visit, which will last for 2 days until September 14.

"Discussing bilateral issues will be part of the dialogue, another important part is to achieve progress in opinion-building on global issues," Volker Stanzel, German Ambassador to China, told China Daily in an exclusive interview recently.

The ambassador revealed that Premier Wen will also attend the Hamburg Summit of the Asian Pacific Association and give a keynote address.

In addition, he will get in touch with corporate Germany, since "an important aspect of our relations lies in the tremendously successful co-operation of German and Chinese businesses."

During the premier's visit, Stanzel said both sides would sign several agreements including one on the establishment of a working group on energy issues, as well as on export credits. In addition, several companies and public institutions from both China and Germany are willing to engage in new areas of co-operation.

As to the bilateral relationship, Stanzel said Germany is "China's most important European partner in trade and investment." He said EU-China and Germany-China ties had become very close, with the relationship between German and Chinese leaders reaching an intensity never seen before.

Both countries have developed a solid relationship over many years and in many areas.

When Germany takes up its EU presidency in the first half of next year, it has been made clear that it will push forward the development of an EU-China comprehensive strategic partnership.

Concerning this proposal, Stanzel said the EU and China have already established a strategic partnership, and the latest round of strategic dialogue took place in Beijing not long ago. "The German presidency will be able to build on this foundation and on the work of our Finnish colleagues during their current presidency."

Natural trading partner

With a volume of US$893 billion, Germany is now the "world champion" in international exports, followed by the US with US$795 billion and China with US$583 billion.

Stanzel pointed out that Germany's and China's exports are highly complementary. Germany is an exporter of industrial goods, while China's exports are mainly consumer goods. "That makes China and Germany almost natural trading partners."

He said Germany and China have the potential to further enhance their economic co-operation, particularly in the fields of environment and energy efficiency, where Germany can offer world-leading technology.

With regard to co-operation in the fields of energy security and energy efficiency between the two countries, Stanzel said the governments of both countries are already working together in the framework of the Chinese-German Partnership on Sustainable Fuel, which explores strategies for further development of energy-use in traffic, focusing on sustainable energies like biofuels and their implementation on the market.

Moreover, the governments have co-operated in the construction sector.

According to Stanzel, Germany's leading development agency, GTZ, has launched a pilot project for the energy-efficient refurbishment of existing buildings in Tangshan, North China's Hebei Province, which is designed to transfer know-how in this field to Chinese partners.

In addition, German Energy Agency (Dena), in co-operation with the Chinese Ministry of Construction, is working on educating people on energy efficiency in the construction of new buildings.

Replying to a query on what the Chinese Government could do more in the area of Intellectual Property Rights (IPR) protection, Stanzel said China had made great progress in this field - with the legislation to fight violations of intellectual property having improved tremendously.

"China is striving hard to be not only a fast-growing, but also an innovative economy. Innovation needs protection through effectively implemented intellectual property rights. We think it is, first and foremost, in the Chinese interest to further develop IPR awareness."

Multi-layered exchanges

With their relationship steadfastly maturing, Germany and China have developed a strong network of governmental and non-governmental institutions and forums to strengthen mutual exchanges and understanding.

As to the mechanisms that have been put in place to strengthen political dialogue and consultations between the two countries, Stanzel mentioned the Hamburg Summit, a top-level economic event, and the German-Chinese Dialogue Forum, a prestigious non-governmental platform for influential members of the civil society.

Both Pemier Wen Jiabao and Federal Chancellor Angela Merkel have agreed, that culture, science and education should be key sectors in which excellent bilateral relations are to be further deepened.

With regard to the key cultural and educational exchanges between Germany and China, the ambassador stressed that the cultural exchange levels are very intense. "The most obvious factor is perhaps more than 25,000 Chinese young people who presently study in Germany."

He added that there are also numerous other fields, such as more than 300 co-operation agreements between universities, the cultural programme of the Goethe-Institute in China, German Music Master Classes, exquisite art exhibitions on both countries, to name but a few.

Casting his eye to the international community, Stanzel said Germany welcomed China's increased participation in the work of the UN, particularly the growing contributions China has made to UN peacekeeping efforts. "As a permanent member of the United Nations Security Council, China is eminently placed in shouldering responsibilities of global governance."

"One notable element in our bilateral relations is the need to look together at international issues which affect both of us, from energy to anti-terrorism, from climate change to good governance.

Functioning international co-operation is vital to both countries; both are, to use a much-quoted catchword, stakeholders in a global venture," added Stanzel.

(China Daily 09/13/2006 page17)

"China attracts more and more foreign investments in the capital- and know-how-intensive sectors," said the chairman of the German Chamber of Commerce in China, Dr Richard Hausmann.

Around 750 research and development (R&D) centres have already been set up in China by foreign enterprises and the number is increasing.

This trend is mainly the result of the improved institutional research landscape and the availability of qualified personnel. Sino-German co-operation in the field of R&D is not only the outcome of better framework conditions but also contributes significantly to this.

"A rising number of German companies establish R&D capacities in China," Hausmann pointed out. More and more of these facilities are not only following the objective of adapting products to the local market, but are also starting to develop new products for the world market. In the chemical industry, large German enterprises have established R&D centres in the Yangtze Delta in order to incorporate China into the companies' global R&D network.

Regarding the electric and electronic industry, a leading German company has already set up 16 R&D centres in China with over 2,500 highly qualified engineers comprising close to 8 per cent of the company's total workforce in China.

In the IT industry a top German corporation set up a further R&D centre in Chengdu early this year - and these are only three of many examples of R&D activities of German companies in China. Nevertheless further foreign engagement also depends on the continuous enforcement of IPR by the Chinese government.

Scientific partnership

The scientific co-operation between Chinese and German companies has a long tradition dating back to the governmental co-operation agreement from 1978. Nowadays, Germany is China's largest co-operation partner for science and technology. Current fields of priority are biotechnology, ocean research, environmentally sound development and new materials.

An outstanding milestone of co-operation is the foundation of the Sino-German Centre for Research Promotion in 2000, a joint venture between the "Deutsche Forschungsgemeinschaft" and the National Science Foundation of China. Other milestones are the formation of the Sino-German Joint Software Institute in Beijing and the Joint Mobile Communication Institute in Berlin, both in 2003.

All important German research institutes are present in China. The Fraunhofer-Gesellschaft has several major projects in China: The partnership with the Chinese Academy of Sciences (CAS) dating back to 1979 enables Chinese scientists to visit Germany for research stays. In addition, the Fraunhofer-Gesellschaft is co-operating with the government of Beijing to develop a logistic competence centre in Zhongguancun, Beijing's Silicon Valley.

The Helmholtz Association with its 15 research centres is Germany's largest research institution: 24,000 employees produce top-rate scientific results in six research fields of energy, earth and environment, health, key technologies, structure of matter and transport and space.

The partnership of Max-Planck-Institute and CAS in establishing international networks is also remarkable: Due to the large number of scientist exchanges in the past, one third of all directors and managers in the CAS are scientists with research experience in Germany.

According to Dr Hausmann, who is also the president and CEO of Siemens Ltd China, the Sino-German Centre of Research Promotion, Max-Planck-Institute, Fraunhofer-Gesellschaft and the Helmholtz Association significantly encourage the development of institutional international research networks.

Changing face of R&D

The Sino-German co-operation in science and technology has to be considered in context with the progress of the Chinese innovation system strongly supported by China's governments: The long-term plan, issued by the State Council in early February this year, increases annual investment in research and development to 900 billion yuan (US$112.5 billion) by 2020, which would raise the share at gross domestic product (GDP) from actually 1.3 per cent to 2.5 per cent.

An important development is the favourable trend of China's research to become more application-based, said Dr Hausmann. In the context of the overwhelming transition of China's economic system, R&D is now not only the domain of public research institutes. Nowadays, 62 per cent of all R&D expenditures are realized by companies. The trend towards application-based research is also reflected by numerous spin-offs, which are founded by universities and research institutes to commercialize their research results.

The chairman of the German Chamber also emphasizes co-operation with Chinese universities.

In 2005, there were around 2.4 million university graduates, many of them from the top 20 universities such as Tsinghua University, Peking University and the Shanghai Jiaotong University, which meet international standards.

Fifty-five per cent of the graduates were natural scientists and engineers with a bachelor's or a master's degree. The access to qualified personnel is facilitated by more than 100 co-operations between German and Chinese universities: Outstanding examples are the well-known "Chinese-German Hochschulkolleg" at the Tongji University, the joint master studies of the RWTH Aachen and Tsinghua on production processes and the automobile industry.

Nevertheless there are some bottlenecks concerning personnel, especially regarding low English language levels, which has to be improved nationwide, as well as enthusiasm and the capacity for invention and experiments by the staff.

Hausmann concludes: "Decades long experiences in R&D between Chinese and German institutions have resulted in significant innovations and are a solid foundation for further intensive co-operation."

(China Daily 09/13/2006 page18)

Ever since Siemens was founded in 1847, the power of innovation has been the key to our long-term business success. Innovation is what keeps us ahead of our competitors; in short, it is our lifeblood.

Siemens' Research and Development (R&D) activities are focused not only on customer needs and market requirements, but also on being a trendsetter to shape future markets or standards.

To accomplish this, we have to be in a strong technological position, particularly with regard to so-called key and pace-setting technologies that determine who will hold the competitive advantages today and tomorrow.

However, we must also be well positioned in disruptive technologies in other words, those that can revolutionize the market in the future.

Our goal is to be a trendsetter in as many fields of business as possible, and this goal drives our substantial investment in R&D.

Siemens now employs more than 47,000 researchers and developers worldwide, a figure that represents 10 per cent of the company's global workforce. R&D spending in fiscal year 2005 totalled 5.2 billion euros (US$6.66 billion), representing 6.8 per cent of the company's sales, or about 23 million euros (US$29.44 million) per working day.

As innovation cycles become shorter and shorter, it is critical to get new products to market quickly and, above all, at just the right time. We have acted on this, and more than 75 per cent of our sales today are generated by products and solutions that are less than five years old.

Siemens has been active in China since 1872, and is recognized as an innovation leader in the country.

Many of China's most advanced technologies are "Made by Siemens." The company aims to be a trendsetter in all its business fields, and to shape its technologies with a clear focus on delivering tangible and valuable benefits to customers and society at large.

China is a key strategic country for our business development, not only significant as a major growth market but also as an important element of our value chain and talent potential. Our vision is for China to become a cornerstone of the global Siemens business and an important driver to make this vision a reality is local R&D to develop products, systems, solutions and services in China for China, and the rest of the world.

Technology commercialization

China already is an important R&D base for Siemens, and will become even more important in the future. We established our first local R&D activities in 1998 and since then we have set up R&D activities in all our business segments, including information and communications, automation and control, power, transportation, medical solutions, lighting and household appliances.

In 2004, Siemens also established a Corporate Technology (CT) R&D Centre in Beijing, which is an integral part of Siemens Corporate Technology global network. The centre's staff has grown to over 150 scientists and developers, focusing on core technologies that have a high strategic impact for the company.

Focal areas are energy and environment, automation, public and private infrastructure and healthcare. The development focuses on SMART - simple, maintenance friendly, affordable, reliable, timely to market - innovations that are tailor-made for the needs of the Chinese market and also have substantial potential to be successful in the global market. A particular focus is technology commercialization to quickly commercialize innovations and encourage innovation entrepreneurship.

Siemens now has 16 R&D centres in China, located in Beijing, Nanjing, Hangzhou, Shanghai and Shenzhen, with over 2,500 highly qualified engineers comprising close to 8 per cent of the total workforce in China. The company ranks as one of the top patent applicants in China with over 1,000 patent applications filed in 2005.

Strong local R&D capabilities are crucial to developing products, systems and solutions that fit the needs of local Chinese customers and the local market. Such offerings also open up additional opportunities by serving customers with similar needs in other markets globally. An example is the Siemens Somatom Spirit, a dual-slice computed tomography (CT) system developed in China for the Chinese and world market. It targets the entry-level CT market with its outstanding usability, high reliability and extremely competitive price, with a fast return on investment. Launched in March 2005, it is a great market success with 300 installations in 30 countries worldwide, include about 100 in China.

University co-operation

Siemens also actively reaches out to China's leading universities and has established numerous co-operations to promote research & development, to foster knowledge sharing and to make contributions to education. For example, in November 2005, Siemens signed a co-operation agreement with Shanghai Jiaotong University to jointly develop a wireless information service testbed based on radio frequency identification (RFID) for application in the China Shanghai World Expo 2010. The testbed will provide an effective and real-time management system for Expo facilities, exhibits and visitors.

Most recently in September 2006, Siemens donated an ion beam assisted deposition (IBAD) to Beijing's Tsinghua University. This equipment, which is the only one of its kind in China to date, will help further consolidate Tsinghua's leading position in novel high-temperature superconducting technology research, which is a major focus in China's plans for science and technology development and part of the widely known national high-tech R&D programme the "863 Plan." Through this donation, Siemens hopes to advance its joint research programme with Tsinghua University in this area, which is listed as a key project by the Ministry of Science and Technology.

(China Daily 09/13/2006 page18)

German development programmes go back as early as 1981 when Carl Duisberg Gesellschaft (CDG) started their capacity building training in China. One year later a framework agreement was signed by both governments, laying the grounds for fully-fledged technical co-operation. This agreement is still in force today.

In this particular field, several German agencies are ready to assist their Chinese partners, of which the German Development Corporation (GTZ) is the most prominent.

Another important agency is InWEnt, a merger of the development institutions CDG and DSE, which serves as a human resource development and capacity building institution.

Every year, the German Senior Expert Service (SES) sends several hundred short-term experts to China to assist companies, institutions and official authorities to fulfil their tasks.

CIM, a human resources provider, runs an integrated experts programme that places highly qualified and professionally experienced experts, mostly from Germany, in Chinese organizations for several years in order to bridge temporary gaps in human resources. A regular local salary for the integrated expert has to be provided by the Chinese employer and the German Government will top it up.

Besides these organizations, several other private German institutions are financially supported to join programmes with Chinese partner organizations.

The second pillar of Sino-German development co-operation is in the financial sector. Financial co-operation with China encompasses soft loans and an increasing amount of development loans that blend market and privileged terms. If certain prerequisites are fulfilled, even grant loans have been issued. Entrusted with the implementation of financial co-operation is the German Development Bank Kfw.

After so many years an understanding has developed which is based on mutual trust and respect. In this way it is possible to support China efficiently to achieve its own development targets. One principle is that German assistance is not meant to solve local problems or to fill financial gaps, but joint programmes are identified where German knowledge can bring innovative elements into the Chinese reform process, which are not yet available locally. Dissemination of the results, integrating them into the overall development of the country is a task of the local authorities themselves.

To bundle resources and increase the significance of the German contribution, both sides agreed to concentrate their co-operation mainly on three sectors: Firstly, environmental protection, energy and the sustainable use of natural resources; Secondly, sustainable market economy; And thirdly, the transport sector. Some additional programmes are also being implemented in the health sector.

A special emphasis is put on energy efficiency, energy saving, and renewable energy, as well as the protection of the environment in other aspects. This reflects for example the importance of protecting global public goods such as climate or biodiversity, helps save scarce natural resources and is intended to support the Chinese Government in reaching its set benchmarks in these fields.

An aim of German-Chinese development co-operation is to establish a key partnership in selected key areas of development. Thus the focus of this co-operation is not on the provision of hardware but on knowledge transfer and exchange of views and expertise in a search for state-of-the-art solutions to tackle China's challenges.

Given China's growing financial and economic power, it has become increasingly important that it handles more tasks itself and also shoulders adequate and growing counterpart contributions, especially as far as funding is concerned.

With regards to regional aspects, German commitments focus on the western and the northeastern regions, unless the programme operates on a national level.

At present a German government delegation headed by Schaefer-Preuss, director-general from the German Ministry for Economic Co-operation and Development, is holding bilateral negotiations with their Chinese counterparts from the Ministry of Commerce and the Ministry of Finance on the future co-operation plan.

Up until now the German Government has entered into direct commitments of 2.87 million euros (US$3.67 million) for grants and soft loans, not counting further considerable contributions which were made available in other forms.

(China Daily 09/13/2006 page18)

Preservation and the excessive use of natural and environmental resources, coupled with high growth rates, are key global issues of concern for the future.

It is not only an ecological but also an economic task, which demands our attention.

Globalization and economic expansion of large developing economies - such as Brazil, India and China - clearly demonstrate that economic growth can be achieved with an increasing reduction of the use of environmental resources.

Using the issue of greenhouse gas as an example: This is especially important for China, as experts indicate that China will be seriously affected by the affects of global climate change. The European Union's carbon dioxide emissions per capita in 2005 averaged 9 tonnes per year.

The per capita emissions of the United States were 21.1 tonnes per year, whereas China's per capita emissions were only 2.3 tonnes per year.

With worldwide carbon dioxide emissions already beyond the limits of the planet today, it is clear: China and other developing countries cannot completely imitate the fossil energy model of Europe or even the United States.

Our common task is clear: To reduce worldwide greenhouse emissions. To this end, industrialized countries must considerably reduce their own emissions.

At the same time, all countries must co-operate more closely to increase energy efficiency and to enable countries like China to raise their share of renewable energy sources.

Widespread co-operation

Germany as a densely populated country with few natural and energy resources began to improve its energy efficiency and to actively develop alternative forms of energy in the mid-1970s.

Today, environmental technologies made in Germany have a world market share of 19 per cent, with 10 per cent of Germany's energy coming from renewable energy sources.

With more than 17,500 wind turbines installed in the country, Germany is the leading manufacturing base for this technology.

Therefore, Germany has tremendous experience in this field and it has been a consistent goal of Sino-German energy and environmental co-operation to leverage this know-how for the sustainable development of China.

This is why the German Government welcomes the energy initiatives of the Chinese Government. For example, it supports the Chinese Government's goal of raising the share of renewable energies in China to 15 per cent of its overall energy consumption by 2020.

And Germany has contributed to this goal since 2000 with various bilateral programmes and projects.

A project for the promotion of renewable energies in rural areas of Yunnan, Qinghai, Gansu and Tibet is a prime example.

Sino-German co-operation in this field also extends to the international level: The Beijing International Renewable Energy Conference (BIREC), held in late 2005, is a significant contribution to the further development of renewable energies worldwide.

It enhanced international discussions about the opportunities for renewable energies, which started at the "Renewables 2004," an international conference held in Bonn, Germany, in 2004.

China acted as a leader in promoting the idea that renewable energies are not a barrier but a basis for economic growth.

The German minister for the environment underlined during this conference the necessity of global co-operation for the global expansion of renewable energies - particularly to reduce the emission of greenhouse gases and to prevent climate change.

The Clean Development Mechanism (CDM) is another efficient way to promote international co-operation in the reduction of greenhouse gases.

This is why a Sino-German memorandum of understanding on CDM which is currently under discussion would be a highly useful platform to promote bilateral co-operation, and initiate further projects between Chinese and German companies.

High-profile forum

To develop strategies for future bilateral co-operation in all fields of environment protection, the relevant ministries of both countries in 2000 held the Sino-German Environmental Protection Conference in Beijing.

This year, the second Sino-German Environmental Forum was held, bringing together many high-ranking officials and Chinese and German business associations in Qingdao.

The State Environmental Protection Administration (SEPA) in China and the Federal Ministry for Environment, Nature Conservation and Nuclear Safety in Germany hosted the forum in co-operation with the Chinese National Development and Reform Commission (NDRC), the German development agency GTZ and the city of Qingdao.

The participants discussed practical issues such as green procurement, green labelling, and the recycled economy.

Several German and Chinese companies arranged for joint environmental projects such as China's first offshore wind park off the coast of Qingdao, with five energy generators each with a maximum capacity of five megawatts.

Germany and China have also established a permanent support structure.

The Sino-German Programme "Policy Advisory Service and Environmental Management," a joint programme of SEPA and the German technical co-operation agency GTZ, running until the end of 2006, is comprised of four distinct components: Policy advising (such as China's WTO accession), environmental management for companies (such as training for executives in small and medium-sized enterprises in Tianjing and Guizhou), capacity building for officials (with training available in both China and Germany), and the introduction of quality management systems (such as ISO 14001).

Since this programme has evolved into an important hub for bilateral co-operation and knowledge exchanges, both sides plan to extend the co-operation in a new Sino-German Environmental Policy Partnership Programme, including NDRC and the China Council for International Co-operation for Environment and Development (CCICED) as additional institutional partners.

Lately, the Chinese central government has been pressing on with many initiatives on pollution control, environmental crisis management, and chemical management.

Consequently, the Sino-German Symposium on Chemical Management was held at the vice-minister level in Beijing on July 11 and 12 this year to address these issues and to introduce the new European Union's chemicals legislation REACH (policy for Registration, Evaluation and Authorization of Chemicals) as well as its consequences for trading partners of the European Union.

As a follow-up activity to the symposium, the German Federal Ministry for Environment, Nature Conservation and Nuclear Safety will establish a working group with SEPA to intensify bilateral information exchanges.

The German Embassy in China

provided the story.

(China Daily 09/13/2006 page19)

For Li Jingzhu, a staff member of a road traffic research institute under the Ministry of Communications (MOC), her participation in the InWEnt programme really boosted her career.

InWEnt, Capacity Building International, is a world leading international education institution in Germany and has established strong presence in China.

Li has since been promoted to advise businesses and the government on logistics strategies by the institute.

Spreading the knowledge gained in Germany through her advisory service and via lectures, she said: "My acquired expertise was extremely helpful to my employer, because it enabled me to implement logistics concepts in Chinese companies."

This year, InWEnt and the MOC will celebrate 25 years of close co-operation.

For the past 25 years, one of InWEnt's predecessor organizations, the Carl Duisberg Gesellschaft (CDG), has offered helpful knowledge on sustainable solutions for MOC's trainees in the fields of transport, storage and the turnover of merchandise, with an emphasis on the regional integration of Central and West China.

Another of InWEnt's predecessors was the German Foundation for International Development (DSE), which has also established a strong foothold in China.

In 2002, InWEnt was established through the merger of CDG and DSE.

Niels Albers, director of the InWEnt Co-ordination Centre in Beijing, said InWEnt views China as its most important co-operator, thanks to its fast development.

"We will push our co-operation to new heights," he said.

Apart from MOC, InWEnt has teamed up with many government departments in China such as the ministries of education and commerce, as well as China's central bank the People's Bank of China (PBOC).

He separated InWEnt's training into three major features.

It is skill- and practice-oriented. People have opportunities to work on internships in related companies or government departments.

Like the PBOC and MOC programmes, people need to master good German language skills and work for central levels of the PBOC.

"Also, InWEnt doesn't come here with a ready-made programme, but tailor-made ones," he noted.

Many of InWEnt's programmes focus on assisting China to achieve sustainable development.

For example, the training on the Administrative Law for judges in China is tailored towards China's drive to build a harmonious society, he said.

The training in co-operation with the China Mayor Association aims at helping mayor-level officials achieve more knowledge and helpful methods to enhance bio-diversity management and environmental protection, echoing the nation's call to achieve "greener" economic development.

Albers said some 10 trainees from the State Forestry Administration and some environmental NGOs, who are the first group to be put through a new environmental protection training programme, will arrive in Germany early next month.

"The new programme indicates InWEnt's training for Chinese people is constantly innovative and tailored-made," said a graduate of InWEnt.

InWEnt has organized a club for its alumni in China to help enhance their co-operation after completing their training.

Different training modes are another feature that explains why InWEnt has such a strong presence among many active training institutions in China.

It offers long- and short-term training, ranging from one week to one year courses.

The courses take place in China and Germany. Online HIV/AIDS training is currently ongoing in China.

It surpasses other training programmes, as its capacity building not only focuses on individuals but on institutions.

Each year, an average of 1,200 skilled Chinese executive staff participate in InWEnt programmes.

Currently, 20 programmes in the fields of good governance and economic reforms, sustainable economic development and transport, as well as environmental policies and HIV/AIDS, are earmarked for participants in China.

Among the programmes, the biggest one associated with the Chinese partners is the Ministry of Education.

A total of 1,400 Chinese teachers have participated in training.

Every year, some 55,000 people around the world take part in the InWEnt's training.

(China Daily 09/13/2006 page19)

Georgsmarienhutte Holding GmbH (GMH), one of the leading engineering steel producers in Europe, is betting on the outstanding quality of its products to spur its growth in China, the world's major fastest-growing economy.

"The Chinese market, with its fast-expanding manufacturing sector, represents strategic significance for us," said Hartmut Heine, GMH's chief representative and general manager in China.

Having established its presence in China since the 1980s, GMH now has 8,000 employees in the nation. It has enjoyed brisk growth over the years, as demand for its high-quality products have stayed strong, thanks to the nation's robust economic growth.

In 2005, GMH's business in China increased by 20 per cent, scoring 60 million euros (US$763 million) in sales. The company is expecting to achieve "at least" similar growth in 2006.

The German-based company now has 12 business units since restructuring in 2003. It now supplies both individual solutions and complete systems for areas such as raw materials recycling, steel production, steel processing, railway wheels and axles.

During its long presence in China, the GMH Group and its subsidiaries have established an extensive network of local customers, not only foreign joint ventures but also local enterprises.

Groditz GmbH, a manufacturer of forged products and electric steel, has been supplying components to Chinese energy industry for over dozens of of years. Georgsmarienhutte GmbH, the nucleus of the Group, has been supplying various steel alloys to the Minmetals Group, China's largest metal importer.

Currently, GMH supplies more than 10,000 tons of steel each year to customers in Shanghai and North China. It also supplies key components used in all types of engines, with a number of China's major automakers being its customers, including Volkswagen, FAW Group Co and others.

"We will strive to promote all our business lines in China in the coming years, as China's demand for high-quality steel products will remain strong," said Heine.

China's economy has been growing at a speed of more than nine per cent over the past decade. In the meantime, the nation has evolved into a major manufacturing hub in the world, fuelling demand for steel products ranging from auto parts to railway wheels.

The Chinese Government intends to invest heftily in infrastructure such as railway links and power plants in the coming years. Meanwhile, the nation's manufacturing sector is also trying to move up the value chain, shifting from basic assembling to products with higher added value.

GMH is hoping to tap into great opportunities in the process as its products have been adopted in a wide range of industries in China, including the power equipment, shipbuilding, and railway equipment sectors.

Windhoff, a subsidiary of GMH, clinched a 2-million-euro (US$2.57 million) deal with Beijing Subway Construction Management Company, to offer machinery maintenance equipment for subway lines No 5 and No 10 in the capital city. Windhoff will deliver the equipment this year so as to prepare for the completion of the projects in 2008.

Windhoff is active in the design and engineering field of machines and plants.

For decades, Windhoff has been concentrating on particular products for special segments of the market.

Its production and sales today include a variety of technologically accurate and reliable products for railway vehicles, railway workshop equipment and handling systems. Windhoff was also a major equipment supplier for the metro project in Nanjing, Tianjn and Shenzhen, and it is now bidding for metro projects in Guangzhou and Dalian.

"One of the key strengths for GMH is that we provide individual products for the whole system, which guarantee the reliability of our products," said Heine.

According to Heine, the Tianjin Light Rail, which was put into use in early 2005, has been operating smoothly - without even a single hitch thanks to the GMH products it adopted.

"Our sales in China will continue to grow in the coming years, given the fast growth in China's economy and the ever-increasing trade between China and Germany," said Heine

Germany is now China's biggest trading partner in Europe. The bilateral trade volume in 2005 reached US$63.2 billion, accounting for nearly one-third of the trade volume between China and the European Union.

(China Daily 09/13/2006 page19)

"I believe in the horse. The automobile is only a passing phenomenon," said Germany's Kaiser Wilhelm II in 1905.

And that is why the history of the automobile as told at the new Mercedes-Benz Museum begins with a nod in the direction of this misjudgement, and a stuffed horse.

That white horse seems a bit out of place at the beginning of the tour, given that everything else in the new museum in Stuttgart-Unterturkheim, the Walhalla of the world's oldest car manufacturer, is on wheels.

The futurist building with the aluminium sheen by Dutch architect Ben van Berkel reminds Focus magazine of a "galactic garage" and Frankfurter Allgemeine Zeitung of a "technoid organ: it vibrates, swells and writhes as if it had swallowed a turbo engine".

Inside, the open-plan building is more than a surprise: it is constructed like a curving double helix - made from 110,000 tons of steel, glass and concrete - and goes to the limits of modern construction statics. It would have been inconceivable only a few years ago.

Meandering bows in concrete lead the visitor through the history of Mercedes-Benz, which at least in its early phase can be equated with the history of the automobile, thanks to the inventors Karl Benz and Gottlieb Daimler.

The spiral walks turn in an endless loop from floors to walls and walls to ceilings and back to the floors again -thus providing the dynamic setting for the presentation of a total of 160 vehicles.

In such a futurist building an ordinary survey of the company's highlights would be out of the question.

In the invitation to take part in the architectural competition Mercedes had expressly stated its wish for a building that would house something that was not "an exhibition in the traditional sense."

The presentation of the content was then undertaken by HG Merz, who had already been the curator in the previous museum, which could no longer handle up to the half a million visitors and more it had to accommodate every year.

In the new building, Merz has divided the 16,500 square metres of exhibition space into seven "Myth" and five "Collection" rooms.

The open-plan architecture, however, enables visitors to cross over and back between the two tours. Together they represent a mixture of the high-tech and a design museum, a show imbued with elements of nostalgia, history and the everyday.

The Myth rooms focus on several outstanding cars from the 120-year-old history of the product range that have had a decisive influence on the development of Mercedes.

The Collection rooms bring together the most varied of models, under headings such as the Gallery of Travel or the Gallery of Heroes, from old-timers to utility vehicles.

The exhibition starts right at the top of the building, namely, level eight. The silent, almost hovering lifts are like time capsules, beaming their passengers into the automobile past.

Visible through slits is a film installation that takes you back in time, and in quick motion, through history. What you can hear at this level is the clatter of hooves and the rattle of coaches.

The Myth begins with the invention of the petrol engine and leads via numerous hair-pin bends from the pioneers Benz, Daimler and Maybach to the creation of the brand name Mercedes and the "Miracle Years 1945-1960" and on to the Myth room entitled "Weltbewegend. Global und individuell ", from 1982 to today.

In between there is no shortage of type designations, construction year references, figures indicating horsepower and cubic capacity, design studies and record-breaking models.

And of course myths in metal, such as a 1908 Double Phaeton, a 300 SL with wing doors or a 1928 white SSK.

And where does this show end? Appropriately in a steep curve, with models of the famous Silver Arrow in the section "Rennen und Rekorde", which in turn are accompanied by the roaring sound of the respective engine - legends on four wheels, which have still not lost any of their elegance.

To see everything in this, the world's largest, car museum you have to cover a good five kilometres.

And to hear the complete tour on the audio guide you would need 36 hours at your disposal.

If you are really taken by it all, then an underground passage takes you directly to the new sales room.

After all, the Mercedes-Benz brand may be worthy of a museum, but it is also very much of this world and strives for one thing more than anything else: to sell that myth with the star.

Source: Deutschland magazine

(China Daily 09/13/2006 page21)

Doing business globally, developing innovations and shaping a sustainable future are the main attributes of Deutsche Telekom's growth strategy.

Consequently, one of the company's aims that reflects the corporate philosophy applied throughout the company reads "We help people towards a better future" - a motto to which the company has felt duty-bound for years and which is voiced by its corporate vision and values, T-Spirit.

In this way, Deutsche Telekom formulates its claim as one of the leading companies in the telecommunications and information technology sector that plays an active part in shaping the future of society.

This is a claim that also sums up the company's understanding of social responsibility.

Social responsibility

A large-scale company like Deutsche Telekom cannot act independently of social developments. It is always embedded in complex economic and social relationships.

This fact is also borne out by Deutsche Telekom when developing funding strategies and sponsorship plans.

The transfer of innovative ideas and services to social development processes is at the heart of this.

In so doing, the company is making a valuable contribution to social advancement in many areas of life.

The aim of Deutsche Telekom's corporate responsibility (CR) activities is to enable everyone to reap the benefits of its economic strength and innovative capability.

This commitment is not a mere charitable deed but also an investment in improved relations with the company's social, political and economic environment.

As a listed company, Deutsche Telekom has to observe the diverging interests of various stakeholders.

The motto of Deutsche Telekom's CR is "Responsibility for tomorrow." It is not just a striking advertising slogan but a clear commitment to sustainable management geared towards the future.

Deutsche Telekom's contribution to society is as multi-layered as the group company itself. Reasoned and purposeful commitment is what is called for here.

It is a basic requirement to support and carry out projects, which are in line with the overall strategy and the company's core business areas.

For this reason, Deutsche Telekom has defined six focal areas: economy and society, research and innovation, environment and health, young people and education, social and regional issues, and sport and culture.

The company has already been involved in these areas for years and is providing momentum for innovation and competitiveness in Germany.

It recognizes CR as an entrepreneurial development of a modern economic and social policy, which provides a clear alternative to regulatory concepts.

Technology and innovation

"We are not only a part of the events on the market but a responsible member of the society in which we work and live. Actively helping people and locations towards a liveable, successful future - that is the demand that lies at the heart of our CR activities," Kai-Uwe Ricke, chairman of the Board of Management of Deutsche Telekom, explains the CR commitment of his company.

The best example of this is the funding of innovative broadband information and communication technologies.

Using these technologies will make a considerable contribution to improving quality of life in all areas of society.

"In a globalized knowledge and information society, we need professional general conditions and an efficient infrastructure for the communication systems of tomorrow," Ricke said.

In May 2006, Deutsche Telekom launched the "T-City" contest. It is aimed at German cities with a population of between 50,000 and 100,000 and calls for project ideas for visible networking of as many spheres as possible.

Alongside the winner of the future "T-City," Deutsche Telekom wants to show the opportunities innovative broadband information and communication technologies offer for the economy, institutions, public organizations and ultimately for daily life.

The winning city will be connected to Deutsche Telekom's high-speed fibre-glass network and will receive access to broadband mobile communication services.

Deutsche Telekom has designed future-proof conditions in which people will enjoy living and working.

The group company has also demonstrated strong commitment to education.

Deutsche Telekom is leading the way in connecting schools to the Internet.

Over the past decade, it has made contributions with initiatives such as "Schulen ans Netz" (schools online) and "T@School," giving young people access to the Internet and helping them handle computers and the Internet responsibly.

Consolidating information technology infrastructure in schools with modern broadband technologies lies at the heart of this commitment.

Nowadays, high-speed Internet is essential with regard to modern education and innovative knowledge management - a commitment in which Deutsche Telekom has invested hundreds of millions of euros to date.

"T@School" and "Schulen ans Netz" are particular examples of the corporate responsibility derived from Deutsche Telekom's business objectives.

The company uses the innovative potential and technological expertise of its core business areas to promote and expand a modern education system - an important contribution to progress and sustainability in society.

(China Daily 09/13/2006 page21)

Yin Cuilian feels forever grateful to a person in Germany, thousands of miles away from her hometown in East China's Shandong Province.

"She helped me when I was at my lowest moment," Yin said.

"I might have remained illiterate without the help of Gisela Mahlmann," said the 21-year-old woman who is now studying computers at Linyi Normal College in Shandong.

Yin still remembers when she was forced to drop out of school 10 years ago because her family could not afford her schooling as her father suffered from mental problems.

Fortunately she became one of the first kids to receive help from Gisela Mahlmann and her Hopebaden-Baden, a German foundation helping Chinese children from poverty-stricken families go back to school.

Since 1996, the foundation has helped more than 1,000 people in Shandong and Qinghai provinces. In Shandong alone, it has helped 680 children in three poverty-stricken areas such as Yinan, Linqu and Rizhao. This year another 40 children from Shandong will be sponsored.

Meanwhile in Zeku County, Qinghai Province, the foundation donated six tent schools and four brick-built schools, which helped about 500 children there.

During the past 10 years the foundation has donated about 1.47 million yuan (US$183,750).

"Through this charity work I gain insight into the lives of many people in China and of the development of China," wrote Mahlmann in her email to China Daily.

Early help

As early as 1990 Mahlmann and her family began to help Chinese children. Having been a TV correspondent based in Beijing from 1988-1994 for ZDF (Second German Television - a publicly controlled non-commercial channel and the second largest in Germany), she became familiar with the Hope Project which aims to help school dropouts. Her family decided to pay the school fees for four kids in four different provinces.

In 1996 when she prepared a TV-documentary for ZDF about the "forgotten face of China," she remembered her "kids."

"I decided to visit our daughter Li Dianxin in Zhuanbu, Yinan County in Shandong," she wrote in her email.

Before going there, she collected money from friends. "Because I feel it is unbearable to go and film poverty without giving any help," she said.

In Zhuanbu she met other families, who could not afford to send all their kids to school. With the money she had collected before going to Shandong she helped about 12 families.

The same summer she went to Qinghai, where she knew the nomads had no schools. She visited the first tent school, donated by UNESCO. "I was convinced that tent schools were the right answer to the education problem there, because sending their children to boarding schools is a contradiction to the nomadic way of life. My dream was to collect enough money to donate to one tent school," Mahlmann wrote in her email.

After her documentary was shown on German TV, many people wrote to her and also wanted to help.

"I decided that I would keep on informing people about the 'two faces of China' and try to help," she said.

In November 1996 Gisela Mahlmann founded with 14 friends Hopebaden-Baden. "The only purpose is to inform others about the need for education help and to collect money," said Mahlmann.

Whenever she was asked to give a lecture on China - any topic from culture to economics and current affairs, Mahlmann asked to use the last three minutes to introduce her foundation.

"I did not take any payment for my lectures, but asked that people donate money instead," she said.

Mahlmann still remembers one of her good friends having her 50th birthday party. The friend asked on the invitations to donate to Hopebaden-Baden instead of bringing presents. On such an occasion a whole tent school was donated with about 120,000 yuan (US$15,000).

The foundation finances 70 per cent of the school fees and book fees for one student for at least three years.

The other 30 per cent would come from the local government, the school and the individual.

"Most of beneficiaries are either orphans or single-parent children, or one of their parents suffers from disease", said Sun Li, an official from Donggang District of Rizhao City, Shandong, who has been helping Mahlmann. "The foundation usually gives financial aid until the child finishes his or her high school," Sun said.

The sponsors usually receive a report regularly describing what the student is planning and what the teachers think about further education.

Continued aid

Since her family went back to Germany in March 1994, Mahlmann has kept in contact with China. She has visited China every three years with her sons, who are now all students. She also goes to China every year to produce documentaries. She has also led special tourist groups, "To show them the 'two faces of China', - the old and new, the rich and poor," she wrote in her email.

Last summer she took a group of people to inaugurate a school in Zeku, Qinghai. "They were deeply impressed by the friendliness of the nomads and by the beauty of the landscape," she said.

Mahlmann has visited her children six times during the past 10 years, according to Gai Tojibo, deputy director of the county and the amount of donations has reached 964,300 yuan (US$120,537.5).

There are now 20 students having received higher education from universities.

Ten Tibetans came back to Zeku last year and work as a nurse, bank accountant, computer technicians and animal doctors.

"I was happy to see these young people return to Zeku," said Mahlmann.

"They are now helping their home region develop. It is good to see that they felt responsible for giving something back," she said.

"I am convinced that education is the key to a better world, to overcome poverty and dependency."

If anyone wants to donate:

Hopebaden-Baden

Bank: VR-Bank in Mittelbaden

IBAN: DE45665623000 003725104

BIC: GENODE61IFF

(China Daily 09/13/2006 page22)

When Ren Gnther's car is running low on fuel, he doesn't drive to the nearest filling station. The taxi driver goes to a local snack bar.

He collects used frying fat in a large container, takes it home, filters the brown concoction and then pours it straight into the tank of his Mercedes C220 Diesel.

Collecting the old oil takes some effort, but it means he can drive his car rather cheaply - for practically nothing.

Is used cooking oil a fuel alternative? Even on the basis of the most generous calculations, the republic's entire supply of old cooking oil would not suffice to replace 1 per cent of the diesel fuel used in Germany. Nevertheless, the recyclers are tapping the pulse of the age. After all, car drivers aren't the only ones beginning to wonder what will actually happen when the crude oil - and therefore diesel and petrol - finally runs out.

Although the oil price has again fallen slightly since its all-time high of 70 dollars a barrel at the end of August 2005, oil remains more than twice as expensive as it was only two years ago.

And a price recovery is nowhere in sight. Experts are warning, the years of permanently cheap oil are over. At the same time, a growing number of geologists believe that worldwide oil extraction will soon "inexorably fall."

To make matters worse, the burning of fossil fuels is also one of the main causes of global warming - and is therefore responsible not only for hurricanes, but also for rising sea levels and for droughts in Southeast Europe and elsewhere.

Experts are already celebrating "green gold," fuel from the fields that can be grown over and over again.

Meanwhile, they are also putting their faith in hydrogen, an energy source that is theoretically available in ample quantities and is also non-polluting.

However, more efficient energy use is the first step, especially for car drivers, say the analysts at Deutsche Bank and the experts of the Umwelt-Sachverst ndigenrat, a specialist environmental commission.

This scenario will indeed hit no other group as hard as the millions of vehicle users. Almost half of the 114 million tons of petroleum products that were processed in German refineries last year flowed into vehicle fuel tanks.

The next largest item - heating oil - provides heat in roughly one third of all German homes.

However, whereas it has long been possible to build houses that can be kept comfortably warm without any heating, road traffic - 55 million cars, trucks, buses and motorcycles - would come to a standstill without petrol and diesel.

So far, only 35,000 motor vehicles are powered by natural gas - and bio-fuel does not meet more than 2 per cent of the demand for conventional petrol and diesel.

Nevertheless, the nearer the end of the oil era draws, the more avidly car drivers are clutching at alternatives.

Workshops that adapt vehicles to run on vegetable oil are doing a magnificent trade; Kai Lorenz of Aachen-based conversion firm Unicar is registering some 50 enquiries a day alone. The cost of the engine modifications is more than 2,000 euros (US$2,540).

Although Germany already leads the world when it comes to biodiesel, there are limits to its development. According to the Federal Finance Ministry, no more than 3.7 per cent of Germany's fuel needs could be met by domestic rapeseed production.

However, the costs of producing ethanol are still so high that production would be uneconomical. Even the importation of cheap ethanol made from Brazilian sugar cane would not enable this alternative to oil to achieve a breakthrough.

Accordingly, great hopes are currently being placed on the second generation of renewable fuel, BTL (biomass to liquid).

It is not made merely from the seeds, but from entire plants. Initially, they are gasified - everything from roots to leaves - and then synthesized into a liquid fuel, a complicated process. Yet the energy yield is great and the fuel produced meets the highest standards.

New alternatives

Saxon company Choren Industries is already conducting production trials of a fuel with the brand name SunDiesel. Mercedes and Volkswagen have successfully tested it.

Because the chemical composition of this synthetic fuel can be precisely adapted to the requirements of the propulsion system of the future, a cross between the diesel and petrol engine, engineers are already enthusing about the "designer fuel".

What is more, it produces almost no more carbon dioxide than the plants originally absorbed from the earth's atmosphere before they were processed into fuel.

As a result of forecasts of this kind, others also hope to be able to supply the motoring community in the future - Werner Mller, for example. In the face of dwindling oil and gas reserves, the former economics minister and current chairman of RAG, the Essen-based energy group that also owns coal producer Deutsche Steinkohle AG, attaches "growing importance" to coal liquefaction.

Although German coal is still too expensive for the process, in China, for example, the first modern coal liquefaction plant is already planned to begin operating in 2007.

Environmental and energy experts are putting a damper on the hopes for coal-based fuel, primarily because of the significant environmental burdens.

However, they also admit that no other oil substitute has a real chance in the short term - except, perhaps, for natural gas.

Although natural gas-powered automobiles are a little more expensive than diesel or petrol vehicles, consumers benefit from lower running costs because natural gas has been exempted from fuel taxation until 2020 in Germany.

The natural gas reserves stored in the earth's crust will last a little longer than global oil reserves. Furthermore, natural gas does less harm to the environment than conventional fuels when burned. Its molecules contain fewer carbon and more hydrogen atoms.

So far, however, the dawn of an era of clean and plentiful hydrogen has remained just a splendid idea. A hydrogen car has never been presented at a car show and there are very few public hydrogen filling stations.

"Energy needs time, decades rather than years," says Carl-Jochen Winter, professor emeritus of energy and engineering. Because the alternatives will either be technologically underdeveloped, too expensive or too scarce, vehicles will have to continue using familiar substances, fuels refined from oil, for some time.

Perhaps, however, they will consume much less of it. After all, conventional engines still have enormous potential for efficiency improvements, for example, by reducing engine size - a process referred to in modern German as "downsizing" - or enhancements in gear design.

Source: Deutschland magazine

(China Daily 09/13/2006 page22)

In July, an enormous slab of rock broke off from the Eiger massif in the Swiss Alps and thundered into the valley below. Geologists attribute this dramatic show of nature to the retreating Grindelwald Glacier.

Researchers in Zurich also fear that the alpine glaciers will shrink to one fifth of their original size by the end of the century, or even disappear entirely, just like the glaciers in the Rocky Mountains, the Andes and the Himalayas.

If this happens, there will be nothing left of the "snows of Kilimanjaro" except the Ernest Hemingway novel of the same name.

This far-reaching change is caused by continuous heating of the earth.

The average global temperature has risen by more than half a degree Celsius over the last 150 years, and experts anticipate another substantial rise in the coming 100 years.

Extreme weather events such as cyclones, heavy rainfall and flooding will increase. However, prolonged periods of drought and desertification are also likely.

Most experts now believe that the greenhouse effect accounts for the lion's share of this temperature increase. Along with the greenhouse gases of methane, nitrous oxide and water vapour, carbon dioxide (CO2) is a major factor preventing heat from radiating into space.

Large amounts of carbon dioxide are produced by burning fossil fuels such as coal, natural gas and petroleum.

Although these reserves are clearly limited, and countries low in natural resources are trying to reduce their dependence on oil and gas, fossil fuels will remain the primary sources for the rapidly growing demand for energy in the foreseeable future, accounting for around 70 per cent of power production.

Economical bituminous coal is even enjoying a renaissance. "While oil is becoming scarce and more expensive, there is still plenty of coal throughout the world," says energy expert Harald Bradke of the Fraunhofer Institute for Systems and Innovation Research in explaining the trends.

While the global climate is becoming warmer, power demand will experience the greatest percentage increases between 2000 and 2020 in the Middle East, the Asia-Pacific region, and Latin America.

Today hardly any subject is publicly discussed as much as clean power in China. Megatrends, such as urbanization and industrialization, have brought a significant power demand increase in China.

To meet the rising power demand in China and to supply continuous energy in a friendly enough way with the climate and environment has risen as a big challenge.

How to meet these challenges? The answer lies in improvement of energy efficiency.

China's energy goal includes increasing overall energy efficiency by 20 per cent by 2010, encouraging innovations for saving energy and resources and aggressively enforcing pollution laws.

As in other places in the world, in China coal will continue to be the country's backbone.

China is the world's greatest coal producer and consumer. The country has huge reserves to satisfy its domestic demands. Right now coal fuels around 70 per cent of China's power generation, 75 per cent of the energy used in industry, and 80 per cent of the household energy.

The use of natural gas, liquefied natural gas (LNG), nuclear power, hydro power and renewable energy, in particular wind, will obviously grow. But coal will remain the major component of China's energy mix.

Among the fossil power sources, coal offers two fundamental advantages: it is inexpensive and available worldwide.

In comparison with natural gas, coal offers greater price stability. And because of these advantages, coal-fired power plants will continue to play an important role in the future.

Under this situation, the efficiency of power plants already in operation or still under construction must be increased and the rate of emissions reduced.

Expertise

The completion of the 2X900 megawatt (MW) Waigaoqiao Phase II coal fired plant in Shanghai marks a further key step in China's adoption of highly efficient clean coal technology.

The Waigaoqiao supercritical plant is one of the most advanced power plants in operation in China and far more efficient than a typical coal-fired power plant in China.

It has a net efficiency of a little over 42 per cent, which compares with a worldwide average of 31 per cent and a German average of 37 per cent for hard coal-fired units.

In comparison to the average power plant of the same size in the Chinese fleet, it saves 1 million metric tons of coal a year, slashes fuel costs by 32 million euros (US$40.6 million) a year, and cuts CO2 emissions by around 2.1 million metric tons a year.

Germany's Power Generation Group of Siemens AG supplied the turbine island and other components for both units. A key role was also played by local equipment manufactures, notably Shanghai Electric Group (SEG).

Its three subsidiaries, Shanghai Turbine Co (STC), Shanghai Turbine Generator Co (STGC) and Shanghai Power Equipment Co (SPEC) provided components for both units. SEG and Siemens will also provide the most advanced ultra-supercritical steam turbines and generators for Waigaoqiao Phase III 2X1000 MW project.

SEG-Siemens co-operation continues to contribute to the development of Chinese high-efficiency clean coal power plants.

The Yuhuan 4X1000 MW ultra-supercritical power plant is another Chinese milestone project and will be able to claim new world records in terms of unit output, steam conditions and efficiency.

SEG secured the main contract to supply four 1,000 MW ultra-supercritical steam turbines and the matching generators.

The main equipment, including components, is based on Siemens' proven technology for supercritical plants and Siemens will support this project by providing certain components.

The first unit of Yuhuan project is expected to start up by the end of 2006.

It is seen as a major step forward for clean coal technology in China and it helps to address two issues facing the country: the need to increase power generation capacity in the East China grid and alleviate the severe capacity shortage in that region; and the need to reduce pollution.

Besides development and improvement of conventional coal-fired power plants, innovative ideas are needed. Completely new kinds of coal-fired power plants are being designed which convert coal into gas before being used for power generation, thereby lowering harmful emissions.

Efficient high-performance power plants like these are the wave of the future.

IGCC (integrated gasification combined cycle) is a promising technology in this area. In this process, the coal is first gasified. The resulting synthesis gas is purified and burned in a combined cycle power plant with adapted gas turbines.

The amount of emissions released is significantly lower than traditional steam power plants. In addition, in a next development step, the CO2 can be separated from the synthesis gas, and the hydrogen-rich gas left over can be used in the gas turbine for combustion.

The coal gasification process and the storage of the CO2 can reduce the emissions to a near zero level but increases the investment costs and decreases efficiency.

By optimizing the entire system, the goal is to improve the efficiencies and costs of both gasification and the power plant in the medium to long term.

Two conditions are necessary for building IGCC power plants: first, the manufacturer needs combined cycle power plant technology with adapted gas turbines.

Siemens has acquired extensive expertise in this field over many years.

And second, it is necessary to fuel such power plants with the gasification technology for various types of coal, biomass and chemical waste. As one of the leading players in this field Siemens has recently taken over the coal gasification business of the Swiss Sustec Group.

With this technology, combined with Siemens' expertise, and together with selected partners, Siemens is in a position to offer turnkey IGCC plants and thus make an important contribution to power generation that is compatible with the environment.

Energy is the driving force behind any society. It is not enough to just have a sufficient amount of energy available.

More importantly, the energy must be best used with full consideration of the environment. Improvement of energy efficiency will continue to be a never-ending topic around the world.

With the joint efforts and strengths of Germany and China, the goal of providing clean energy for China can be achieved.

Siemens Ltd China provides the story

(China Daily 09/13/2006 page23)

The Power Generation Group (PG) of Siemens AG is one of the premier companies in the international power generation sector.

In fiscal 2005, which ended September 30, Siemens PG posted sales amounting to approximately 8.1 billion euros (US$10.3 billion) and received new orders totalling 10.9 billion euros (US$14 billion). Group profit amounted to 951 million euros (US$1.2 billion). On September 30, 2005, Siemens PG had a workforce of approximately 33,500 worldwide.

Siemens PG on its own or in partnership with other companies can offer a complete range of forward-looking technology for the economical and resource-saving production of electricity and heat.

With the experience gained by a total installed plant capacity of more than 770 gigawatts (GW), it serves customers as a true partner throughout the entire power plant life-cycle: beginning with planning, project administration and project financing, supply of products and systems, continuing through turnkey construction and on to comprehensive service including plant operation and maintenance.

Its lignite- and coal-fired power plants attain very high efficiencies, resulting in a considerable reduction in emissions and the dissipation of far less waste heat.

The combined cycle power plants attain even higher efficiencies and hence maximum cost-effectiveness and environmental compatibility.

Siemens PG is a committed partner to China's power industry for highly efficient and environmentally compatible power plants and related services. Together with its Chinese joint venture partners Siemens PG is in the number one position for large-capacity, advanced steam power plants.

In October 2004, Siemens PG made a breakthrough in the Chinese gas turbine market, when the group in a consortium with Chinese partner Shanghai SEG secured orders to supply nine gas turbines for four combined-cycle power plants in China. The volume of the orders for Siemens was approximately 2.2 billion yuan (US$275 million).

All the three units installed at Huaneng Shanghai Combined Cycle Power Plant started operation successfully in July 2006. Located in Shanghai, it is the biggest of its kind in the area. With a total output of 3X400MW, its net efficiency reaches around 58 per cent.

In co-operation with SEG, Siemens PG established Siemens Gas Turbine Parts Ltd Shanghai with total investment of 580 million yuan (US$72.5 million) to provide the manufacturing of key components for Siemens' most advanced gas turbines.

Overall, Siemens PG is well positioned to benefit from future opportunities in this area.

In the industrial application area, a new joint venture Siemens Industrial Turbomachinery (Huludao) Co Ltd (SITHCO) was established in Liaoning Province in April 2005. In December 2005, Siemens won a contract to supply a total of six compressors and three steam turbines to China's largest olefin plant in Xinjiang.

With the global acquisition of Bonus Energy A/S in late 2004, Siemens entered the rapidly growing wind energy business. In China, a total number of 88 units of Siemens (Bonus) wind turbines were installed in eight wind farms in Xinjiang, Inner Mongolia, Hainan and Fujian.

In the service business, PG reached another Operating Plant Service Agreement for Gas Turbines of CNOOC Hainan Power Generation Co Ltd in Yangpu, Hainan Province.

Siemens Ltd China provides the story

(China Daily 09/13/2006 page23)