Dear clients and friends:
This is our 5th edition of the China Factor, at the end of the 3rd quarter of this 2009, a year with a volatile economic environment. At Deloitte, we want to keep you updated with the latest news and relevant reports during this period.

In this edition, you will review our experts´ opinion on the manufacturing sector in China, as well a detailed analysis about what business executives are projecting for the Mexican economy in the 10th Business Barometer Survey. You will review their perspectives and projections about employment, government, investment, and exchange rate, from their own reality.

Also, we share an editorial comment with insightful aspects to take in consideration when dealing with the Chinese business culture.

Additionally, you will be informed about the latest tax issues, events, seminars and webcasts in both China and Mexico.

Contact us for more information about this newsletter.

Global Chinese Services Group
Deloitte Mexico

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Editorial comment
Business Culture - China

In this fifth edition of newsletter, I wanted to take a different approach. Obviously, there are a lot of movements in China and the economy is doing better than before. Coke, Apple and other companies starting to make major investments into the country, something that 10 years ago no one cared to think about. Many Latinamerican countries are starting to make a move and work towards unifying or understanding the Chinese culture and the way they do business. Many are realizing that it is not so simple to work in China. In Brazil classes are being offered daily to learn the language and in Peru they are putting Chinese cultural centers to understand traditions. Even in countries like Venezuela and Argentina, China has affected their way of life and the approach these countries are focusing on business. Obviously the opportunity is there; however, China is a very vast and complex market, even though it is becoming a world leader and even affecting global policies, it’s a baby with the power of an adult. That is why there isn't really a strong understanding of the business culture that exists.

Here are some things that I would suggest you do when you are meeting with Chinese counterparts, as they can mean the difference between signing a successful deal or losing it.

First, make sure that you know what language you are speaking, Chinese are simple people but demand the utmost in respect. They want to know that you care. So, when you get a business card make sure that you receive it with both hands and when you give your card make sure that you deliver it with both hands, bowing slightly. When you get the card hold it for a couple of seconds read it and when you sit down in the meeting put it in front of you. This simple gesture can mean the difference between success or failure. Make sure that you call them by their last name and use the title Mr. or Mrs. They do not like to be called by the first name the first time. Wait until you know them better for that.

These are just some basic recommendations as there are many more cultural differences that exist between are cultures, something Deloitte can help understand better. For more information go check out our CSG website and podcasts on the subject.

Cordially,

David C. Chen
National Director
Mexico CSG Country Leader
Chinese Services Group
Deloitte Mexico

Go to GCSG site

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Taking the helm of business in China
Download tax bulletins & analysis

Tax Analysis - SAT strengthens tax administration
The significant drop in fiscal revenue resulting from the global economic downturn prompted
the State Administration of Taxation to issue a circular (Guoshuifa [2009] No. 114) providing
guidance to the local tax authorities to enable them to enhance enforcement efforts with
respect to the tax administration of nonresidents and the prevention of tax avoidance, etc.

Please open and read the attachment for more details.

	English
	Chinese

China M&A Round 08/28/2009

English

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Publications
Check out the latest business updates for
China / Mexico

China Real Estate Investment handbook
The details that make the difference.
Review the 2009 edition.

English

China Manufacturing -Deloitte Review
China has attracted foreign direct manufacturing investment at a rate unprecedented in history, from companies of all sizes and industries, driven by its low production costs, a vast supply of labor, and preferential tax treatment for foreign investors.
But China’s manufacturing landscape is changing.

To know more download the complimentary article reprint.

English

Mexico: 10th Business Barometer Survey
Please review the results´ analysis of the Tenth Business Barometer Survey in Mexico, survey carried out in June 2009 to business executives of a wide array of companies in the country.

In this tenth edition, we can appreciate a significant change in the opinions of the executives; opinions jumped from a clear deterioration of their forecast in December of 2008 to a more positive one that made them suppose a better future for their businesses. Hence, they expect foreign exchange stability and they trust that inflation pressures would be able to decrease in 2009 and 2010.

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Keeping pace
Be updated about China´s business environment through our online tools:

Listen to previous webcasts:
http://www.deloitte.com/ap/dbriefs

China’s Overseas Oil and Gas Investments: Opportunities and Challenges of Exploring a New Frontier: September 09, 2009

Host: Timothy Klatte
Presenters: Ivan Wong and Andrew Zhu

Chinese oil companies are involved in the sale and purchase of almost every major upstream oil and gas asset around the world today. Based on a number of these recent M&A transactions, what are some of the most common issues and considerations Chinese companies face in overseas oil and gas deals? We’ll discuss:

• Recent China outbound oil and gas M&A activities and trends in the global market.
• Key challenges for Chinese companies, including tax issues.
• An overview of deal structuring and tax-aligned supply chain management for Chinese enterprises expanding overseas.

Learn about key trends and issues affecting your company as it prepares for overseas transactions in the oil and gas sector.

Register to webcast:

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More Information

Events

Expo China - Mexico City
It´s coming in November, 5,6, & 7.
Please review the preliminary program:

Register here to receive an email invitation to Expo China

Conferences - Preliminary program:

Day 1

1. A.A. Roberto Ramos (ITRANS, Global Logistic Solutions). “¿How to make business with the third most important Economy in the world?
2. Dr. Enrique Dussel Peters (Coordinator, China-Mexico Study Center, UNAM. “Main challenges for the public and private sector to improve business relations between China & Mexico”
3. Sr. Missael Espinoza (Secretary, Mexican Association of Secretaries for the Economic Development . “Experiences to improve the business relations between China & Mexico with young business executives”

Day 2

1. Dr. Arturo Oropeza García (Institute for Juridical Investigations, UNAM). “Business and the legal framework in China”.
2. Dr. Luis de la Calle, (General Director and founding partner of the De la Calle, Madrazo, Mancera S.C.). “Market nich and effective potential of the mexican exports to China”
3. Act. Abraham Hernández (Director, Intelligence Unit, ProMéxico). “Mexican exports from Mexico to China: business potential”.

Day 3

1. Dr. Romer Cornejo (Professor, Colegio de México). “China: ¿business potential for Mexico?”
2. Mtro. Ignacio Martínez (Professor, Political Sciences, UNAM). “Business Experiences of Mexican companies in China”.
3. Juan José Ling (Consultant). “Business experiences from Mexico in China: conditions and challenges”.

Note: This is a preliminary program subject to change. For more information, please visit: http://www.expochinamexico.com/conferencias.html

Check the latest news about the World Expo 2010

Location: Shanghai, China
Duration: May 1st. to Oct 31st. 2010
More information:
http://en.expo2010.cn

Seminars

Fair value and financial reporting seminar
In today's volatile market, the use of a valuation specialist to assist in the fair value determination for financial reporting purposes is vital to ensuring the fair presentation of a company's financial assets and liabilities.

Date: Tuesday, September 15th. 2009
Location: Hong Kong

Financial reporting update
The beginning of the year 2009 signals the end of the breathing space in which the International Accounting Standards Board committed for two years not to require the adoption of any new standards before January 1st. 2009.

Date: Wednesday, September 16th. 2009
Location: Hong Kong