Passage 1

China’s Economic Role Is Burgeoning

For Japanese businesses grappling with the strong yen, China is especially attractive. Japan’s domestic market is sagging, and yen-based costs are pricing its exports too high. China offers a thriving market and a cheap production base. Nearly one of every 10 yen that Japanese companies invest this year will end up in China, by one estimates. The latest move: Akai Electric Co. pledged $230 million for 81% of a Hong Kong company that is South China’s biggest maker of consumer electronic goods. It then laid off 40% of its Japanese workforce.China’s market could grow even more important, and not just to Asia. Deputy U. S. Trade Representative Charlene Barshevsky, in recent testimony to Congress, noted that although Sino-American trade surged to $40 billion last year from only $2 billion when Beijing began its economic reforms in 1979, trade in some areas, notably services, is still closed.To be sure, China’s trade expansion hasn’t been smooth. This year, Beijing averted U. S. sanctions by settling a dispute over copyright and patent protection. And China will also open its market further to meet global standards.

The strong yen had negative influences on Japan’s export.

Against this deteriorating global background, the improvement in economic performance in a few developing regions in 1991—which earned over into 1992 —was especially noteworthy. This improvement is attributable, in part, to the implementation by many governments of measures to stabilize their economic and restructure incentives to encourage private initiative and international trade. Policy reforms in Latin America helped to moderate inflation and domestic demand; East Asia economics, supported by growth in export volume in the range of 10 per cent and by robust domestic demand, continued to grow rapidly. Also noteworthy was the implementation by the Paris Club of u new menu of enhanced concessions on debt rescheduling for the severely indebted, low-income countries.

The younger generation has different investment idea with the old generation.

Diversification means development of non-oil activity in UAE.

Dubai is planning to levy income tax.

Passage 2

Smooth Ride on the Road to Success

Dubai is concentrating on consolidating its position as the region’s leading location for trade, business and pleasure and entertains few thoughts of changing a winning formula. In early November, customs officials ruled out any increase in the current four per cent import tariff, even though other GCC members have been calling on the UAE to raise levies, so that a uniform customs duty can be established. Government officials have also been quick to dismiss any suggestions that the emirate plans to introduce some form of income tax.As the heavy investment continues in infrastructure, tourism and business conferences, Dubai is working on polishing its image. On the business front, the government is leading by example. In the interests of greater transparency, stale-owned organizations like Emirates airline have started to publish financial results. The authorities are also working to ensure that services are delivered professionally.The range of economic activity remains one of the UAE’s great strengths in combating the periodic downturns in the oil market. Nevertheless, it is widely acknowledged that the oil price continues to have a disproportionate bearing on the economy’s well being and that further diversification is required. Strong emphasis is being attached to the development of non-oil activity, whether it would be through joint stock investment companies, like the recently-formed Dubai Investments, government agencies such as the UAW Offsets Croup or private sector initiatives.The attitude of the local private sector towards industrial investment varies considerably, although there are signs that more investors are becoming aware of its commercial benefits. “The old generation is still into real estate.” Says EBI’s al-Jallaf. “Whenever they have some spare cash, they will invest it in hand, as they consider it safe. But here is also a whole new younger generation coming along, who knows that industry can deliver. What they tend to is to set up some venture which runs parallel to their trading activities.”

Customs in Dubai will increase the current import tariff by 4%.

Emirates airline is operated by the government.

Sino-American trade means foreign trade between Japan and the U. S..

A dispute arose between China and the U. S. on intellectual property protection.

Japanese companies’ investment in China will increase employment in Japan.

Almost 10 percent of Japan’s investment poured into China.