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Play Solar at the Source for SunSi Energies Inc. (OTC-BB: SSIE)

Play Solar at the Source for SunSi Energies Inc. (OTC-BB: SSIE)

SunSi Energies Inc. (OTC-BB: SSIE), a development-stage company focused on becoming the de facto supplier of trichlorosilane (or TCS) to solar module manufacturers like ReneSola Ltd. (NYSE: SOL) and JA Solar Holdings Co., Ltd (Nasdaq: JASO), could see significant upside over the coming years.

SunSi Energies Inc. (OTC-BB: SSIE) is a development-stage company engaged in the acquisition of trichlorosilane (TCS) production facilities in China. While the substance – a raw material used in photovoltaic solar modules – is used throughout the solar industry, the company would become the only TCS pure play listed on a stock exchange, offering investors exposure to the top of the value chain.

On August 30, 2010, the company set its plans in motion with a Letter of Intent to acquire Wendeng He Xie Silicon Co., a trichlorosilane producer located in Weihai City, China with annual production capacity of 20,000 metric tons. Upon closing of the agreement, the firm will acquire a 60% equity interest and the facility’s capacity will be expanded to 60,000 metric tons per year.

Raw Materials Dominate Solar Value Chain

While solar power began as a strong force supported by government subsidies, some countries have begun to pull back on their funding due to the economic crisis as module prices also continue to fall. As a result, some solar manufacturers and installers are facing pressure on their profit margins. So, where do the greatest opportunities now lie in the still-expanding solar industry’s supply chain?

As with commodities, the raw material suppliers often have the greatest pricing power in the industry. For instance, rising oil prices boost the profits of drillers, but can squeeze the profits of those further down the supply chain, such as refineries. The same is true for solar, where raw materials like trichlorosilane are often sold at higher margins than products further down the supply chain.

Do you have an example of the margins seen in a TCS facility that we can put here and compare to a module manufacturer that is public?

SunSi’s Plans Bet on Higher Solar Demand

While the solar picture may be bleak in the near-term, many analysts are confident in demand recovery over the longer term. Last week, UBS raised its solar demand forecast for 2010 and 2011 by almost a third, while IMS Research noted that Chinese module companies as a whole performed well. As a whole, analysts expect solar demand to maintain a 20-30% compounded annual growth rate through 2020.

SunSi Energies is positioning itself for this growth in solar demand by increasing its TCS capacity from a target of 40,000 metric tons per year in 2010 to more than 125,000 metric tons of annual capacity within the next three years. The higher capacity will enable the company to generate greater sales levels and improve its margins via economies of scale to capitalize on the tremendous market opportunity.

Capitalize on Solar with SunSi Energy

SunSi Energies is at the beginning of its growth phase, having just submitted a Letter of Intent to acquire its first trichlorosilane (TCS) production facility. With plans to increase this 20,000 metric ton capacity to 125,000 metric tons over the next three years, the company is well-positioned to profit from one of the highest margin segments of the solar supply chain. Investors looking to take advantage of this opportunity may want to take a closer look at SunSi Energies, Inc. (OTC-BB: SSIE).

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Supply Side Economics at SunSi (OTC-BB: SSIE)

Supply Side Economics at SunSi (OTC-BB: SSIE)

SunSi Energies Inc. (OTC:SSIE), which aims to provide the raw materials used by solar companies like LDK Solar Co., Ltd. (NYSE: LDK) and JA Solar Holdings Co., Ltd. (Nasdaq: JASO), is revamping their leadership team in a big way. The company is setting the stage to pounce on neglected market segments and become a leading supplier to the solar industry.

SunSi focuses in on acquiring Chinese facilities that produce Trichlorosilane (TCS), which is the raw material needed for producing solar photovoltaic (PV) components. SunSi may be researched here http://www.sunsienergies.com

Emerging Strong from China

SunSi Energies is looking to consolidate TCS producers in China in order to become a stand out player in the industry. After appointing credible leadership with extensive expertise, the team is now focused on a vigilant acquisition and expansion strategy.

SunSi realizes the current demand in China, acknowledges existing production inefficiencies, and can’t ignore the growing potential for export. The company has ambitions of becoming the largest TCS producer in the world, and now has the management, plans in place, and sustainable focus to bring it all to fruition.

Battling Oil with Seasoned Management

Soon, the world will decide that it is tired of getting its energy from dirty and inefficient fossil fuels. As solar becomes a prominent market force and increasingly more cost-effective, SunSi Energies is the company that will be holding the keys to the gate in terms of resources. This need for alternative energies like solar power is making TCS a huge factor in the world’s coming energy revolution.

Michel G. Laporte is the Chairman and CEO of SunSi Energies and is a seasoned veteran in his field. Mr. Laporte brings extensive work experience, which includes the management and development of mutual funds and a background in civil engineering. With respect among his peers and an arsenal of entrepreneurial will power, Mr. Laporte is leading the way and ushering in a new team of experts needed to bring SunSi to the next level.

Mr. Zhang Fahe has been appointed as the Director of Technology and holds over 30 years of experience in the Chinese chemical industry, while Mr. Chen Changming has been appointed as Chief Representative and possesses a vast knowledge of foreign trade and investment. This elite officer panel also includes Mr. David Natan who has been appointed as their new CFO. Mr. Natan brings over 30 years of merger, acquisitions, equity capital and expert management skills with him.

Fossil fuels may still be the cheapest form of energy, but solar power has broken the $1 per watt barrier and is getting ever closer to economic viability. As for the future, SunSi Energies is aiming to form the base of the industry with its expert team. By consolidating the supply-side of the solar industry, SunSi is well positioned to benefit from the coming rapid adoption of solar technologies.

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Eastbridge (OTC-BB: EBIG) Offers Shareholders a Strong Pipeline of Asian IPOs

Eastbridge (OTC-BB: EBIG) Offers Shareholders a Strong Pipeline of Asian IPOs

EastBridge Investment Group Corp (OTC:EBIG), a financial services company that provides Asian companies with access to U.S. capital markets, while consistently maintaining an inventory of several Asian IPO clients, will unlock big value for their own shareholders in the wake of successful IPO’s like those of Chinacast Education Corporation (Nasdaq: CAST) and China Agritech Inc. (Nasdaq: CAGC).

EastBridge Investment Group Corp (OTC:EBIG) assists Asian companies with the auditing, legal and investor relations processes to become public companies and achieve listings on U.S. stock exchanges, while also making valuable introductions to investment bankers and accredited investors. In exchange, they receive cash and equity fees that often amount to a 10 to 20 percent equity interest.

The company’s clients are involved in industries as diverse as education, energy and retail distribution, and all are experiencing rapid growth in China’s emerging economy. With a slowdown in the U.S., E.U. and other developed economies, demand for high growth Asian equities remains very strong. As a result, EastBridge offers investors a unique way to capitalize on Asia’s high growth equity markets.

By acquiring equity in these clients at pre-IPO multiples, EastBridge shareholders could see some significant capital gains down the road.

China’s Economy Rapidly Expanding

After overtaking Japan as the world’s second largest economy, China continues to drive forward with 10.3% expansion over the past year alone. Put into prospective, U.S. GDP growth over the same period is estimated to be just 3.2%, and that figure is still being revised lower following what some economists are predicting could become a double-dip recession.

While China still relies on exports to drive its economy, the world’s most populous country is also starting to look domestically for growth. Per capita income for its citizens grew from $350 in 1990 to more than $3,000 by the end of 2008. Assuming a similar growth rate, average national income could reach $8,500 by 2020 and $20,000 by 2030, which could lead to strong domestic consumer spending.

EastBridge Capitalizes on China’s Growth

Companies are the driving force behind growing economies and they require sufficient working capital in order to expand. Since China’s capital markets are just burgeoning, many companies look towards foreign capital markets for fundraising. And the United States stock markets currently represent the largest, most liquid, and most transparent source of capital in the world.

EastBridge Investment Group Corp. helps high-growth Chinese companies access these markets by listing their securities onto U.S. exchanges, forming joint ventures with U.S. companies, and/or accessing traditional merchant banking services. By collecting a 10 to 20 percent equity interest alongside cash fees, shareholders have a unique ability to participate in strong upside potential at pre-IPO valuations.

A Look into EastBridge’s Portfolio

As of August 13, 2010, EastBridge is helping eight clients with the auditing and legal processes involved in becoming a public company in the U.S. Its diverse portfolio of clients across multiple industries minimizes risk for investors while providing unparalleled exposure to one of the fastest growing economies in the world.

These clients include:

  • Wonder International Education – A professional and vocational education provider to post junior high and high school students to improve their skills for higher paying jobs.
  • Tsingda Education Company – A tutoring and education services provider to elementary, junior high and high school students in China.
  • Jinkuizi Science and Technology Company – A manufacturer of environmentally safe fertilizers in China and Southeast Asia.
  • Alpha Green Energy Company – A renewable biomass company focused on China’s agricultural industry as a source for raw input.
  • Long Whole Enterprises, Ltd. – A precious metal mining company focused on properties in the Democratic Republic of Congo.
  • AREM Pacific Corporation – A company that is undergoing a restructuring to enter a new line of business that is currently undisclosed.
  • StrayArrow International Limited – A luxury lifestyle and hospitality company located in China.
  • Heyuan Dafeng Animal Husbandry Company Limited – An integrated “Green Farming” business specializing in premium hogs, feeds and organic fertilizers production.

EastBridge Prepares to Unlock Value

While none of its clients have yet gone public, EastBridge is rapidly progressing to the point of unlocking value for its own shareholders. Once the clients go public, the company’s equity interests will be salable and shareholders will have a clear glimpse at the profitability and scalability of its business model.

As noted above, EastBridge is in the process of establishing an “Asian Pipeline” which will deliver high growth companies to the U.S. markets. Investors should review the stock now, ahead of any of its’ clients public offerings.

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Liquor Distillers in The People’s Republic

Liquor Distillers in The People’s Republic

Kweichow Moutai Co., Ltd., (SHA:600519) and Wuliangye Yibin Co., Ltd. (SHE:000858) are two of the big players in China’s liquor business. These companies are proving that working hard in China feels a little bit sweeter when you hold a cold alcoholic beverage in your hand after putting in long hours in the business world.

Although the Chinese economy is booming and moving rapidly to become the largest economy in the world, the people of China have not been distracted from the lighter side of life. The country is working hard and developing a taste for a variety of alcoholic beverages. After a hard day’s work, some Chinese like to lay back, relax and enjoy some drinks. These are the companies that are focusing in on the free time of China’s citizens.

Kweichow Moutai Co., Ltd. produces, distributes and sells liquor in China. The company has a diversified portfolio as it is involved in food, drink, as well as other lines of business like anti-counterfeit technology and IT products and services. Aside from producing over 29,000 tons of their Moutai liquor products alone, the company has an established ability to market domestically and overseas. Kweichow Moutai is number 1 in China’s alcohol market and valued at $140.55 billion and their stock is currently trading at $148.92 per share.

Kweichow Moutai has a very strong domestic portfolio with potential to dominate markets outside of China. In a global economy, the company is very well positioned to start acquiring small brewing companies in order to establish a huge variety of liquor products.

Wuliangye Yibin Co., Ltd. Has positioned itself on the Minjiang River, north of Yibin City in Southwest China. The company restructured itself in 1998 and now is a modern corporation that performs many different operations in the Chinese marketplace. Wuliangye Yibin manufactures plastic products, high-end injection and stamping molds of all sizes, is involved in bioengineering, pharmaceuticals, logistics, and many other services and activities. The company boasts 30,000 employees, 400,000 tons of liquor and a capacity to package more. Wuliangye Yibin Co., Ltd. has a market cap of $113.04 billion and their stock is currently valued at $29.78 per share.

Wuliangye Yibin Co., Ltd. has brand loyalty and a good relationship with the community in China. The company believes strongly in social responsibility and taking care of the people in its regions of operations. This can sometimes be overlooked as unnecessary expenses, but when you have 20 different bottles in front of you at the supermarket and one of them reminds you of how they helped your community in a time of need, the decision becomes very easy.

These two behemoths have been around for a while and are not going anywhere anytime soon. The only question that still remains is; how far is their reach into the market? That is a question that can be answered over time, but their goals set them apart. Kweichow Moutai is positioning itself to look at the global market. Wuliangye Yibin Co., Ltd is refining its domestic base and focusing on saturating the market with its products and social responsibility. Whichever way you look at, both companies are playing the game they know best, and to the victor go the spoils.

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Chinese Insurance on the Rise

Chinese Insurance on the Rise

China Pacific Insurance (Group) Co., Ltd (HKG:2601),Ping An Insurance (Grp) Co of China Ltd. (HKG:2318) and China Life Insurance Company Limited (HKG:2628) all provide the people of China with insurance services. Some of these companies offer other financial services, too, but the economy of China is bound to head to new heights. When that happens, the financial sector will be headed in the same direction.

China Pacific Insurance is a Chinese based insurance company that provides a wide array of insurance services, including life, casualty and property insurance. The company is involved in asset management and deploys its funds through subsidiaries. China Pacific is also involved in pension products and reinsurance. China Pacific Insurance (Group) Co., Ltd (HKG:2601) has a market cap of $269.18 billion and their stock is valued at $31.30 per share.

Ping An Insurance is the third largest insurance company in China. The company started off as a casualty insurance company, but since the 90’s, the company has started to diversify its portfolio into financial services. The company accepted investments from Goldman Sachs and Morgan Stanley in 1994 and it was obviously a good investment, considering the company is valued at $471.55 billion and has a stock valued at $64.20 per share. However, 20% of the company is owned by HSBC, which makes the bank a majority shareholder.

China Life Insurance Company Limited offers other forms of insurance to its customers, but that does not stop the company from dominating its competitors. China Life Insurance is the largest insurance company in China. In 2009, the company had 115 million individual and life insurance policies. It also had annuity contracts and long-term health insurance policies in force. The company provides many different insurance services to its clients. China Life Insurance Company Limited (HKG:2628) has a market cap of $985.02 billion and their stock is valued at $34.85 per share.

These companies are constantly rising because the needs of the people in China are constantly changing, and usually for the better. Wages are on the rise, costs are down and Chinese citizens are very frugal with their finances. The financial sectors are bound to do very well due to the fact that the economy is taking off so quickly. When people in China get pay raises and better benefits, they have to adjust their life insurance policies and think of ways to save that money. These companies provide the solutions to their financial needs and they are going to be around for a good while.

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China Wi-Max (OTC-BB: CHWM) Capitalizes on China’s Booming Broadband Industry

China Wi-Max (OTC-BB: CHWM) Capitalizes on China’s Booming Broadband Industry

China Wi-Max Communications, Inc. (OTC-BB:CHWM), an emerging broadband provider in China, similar to China Tel Group, Inc. (CHTL) or Time Warner Cable, Inc. (TWC) in the United States, is well positioned to capitalize on the country’s compelling broadband trends by targeting a profita-ble niche in key metropolitan areas.

China Wi-Max Communications, Inc. (CHWM) is an emerging business broadband provider focused on China’s largest metropolitan cities and is ready to capitalize on strong trends in one of the world’s fastest growing economies. With a focus on quality and support, the firm expects to rap-idly grow revenues, beginning in Beijing, later this year.

Internet Growth Takes Off in China

The number of Internet users in China grew by around 10% since the beginning of the year alone, according to the China Network Information Center (CNNIC). Meanwhile, the average Internet user in China spends approximately 20 hours per week surfing the web, compared to just 13 hours per week for the average US Internet user.

Business broadband usage is also dramatically rising as the country is widely regarded as the next big emerging market for industry. These trends are apparent in the rapid growth in the country’s commercial real estate market. Since the beginning of the year, the cumulative number of office buildings sold rose 74.5% year-on-year, according to Research In China (RIC).

China Wi-Max is Positioned to Profit

These trends have helped to dramatically boost the profits of many media companies offering products and services on the Internet, but the real opportunity lies in the underlying wireless broadband infrastructure. Currently, the broadband industry is fragmented in China, much the same way it was in the US in the early days, yielding significant opportunity for new entrants.

China Wi-Max is focusing on consolidating broadband offerings within the commercial sector in the country’s ten largest cities. Starting with Beijing by mid to late 2010, the company plans to roll out in five cities in the coming years. Meanwhile, it is focusing on new office buildings and other long-term users who are unlikely to switch providers and willing to pay more for quality.

Profitable Niche in an Emerging Industry

China Wi-Max aims to differentiate itself by providing high-quality service and support to the commercial sector in a market, often plagued with low-quality services. Moreover, its focus on new commercial construction yields higher margins and lower turnover than residential sales, leading to more predictable financial results for investors.

Currently, China Wi-Max is trading with a market capitalization of under $2 million, according to Google Finance. Given its near-term launch of services in Beijing, China’s rapid growth, and the company’s potential over the coming five years as it rolls out its services in new cities, investors may want to consider this emerging growth stock for their portfolios.

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Chinese Food Producers on the Move

Chinese Food Producers on the Move

Want Want China Holdings Ltd. (HKG:0151), Inner Mongolia Yili Industrial Group Co. (SHA:600887) and Bright Dairy & Food Co., Ltd. (SHA:600597) are all involved in distributing and creating food related products in China. These companies have specific food markets that they concentrate on, but they have become experts in their chosen field.

Bright Dairy & Food Co Ltd. is a large conglomerated food company that deals with producing food and dealing with agriculture. The company is involved in seed breeding, eco-agriculture, food processing and distribution logistics. Bright Dairy & Food runs supermarkets and holds more than 3,300 retailing outlets in Shanghai and other provinces throughout China. The company holds a reputation for top quality brands and has created a network to distribute them across the country. The company is also focused on acquisitions at this time. Bright Dairy & Food Co., Ltd. has a market cap of $9.74 billion and their stock is currently trading for $9.35 per share.

Inner Mongolia Yili has ambitions of securing the largest market share of the dairy industry in China. Yili Group also wishes to be one of the top 10 enterprises in the world’s dairy industry. The company has done a superb job thus far, seeing as that they have created a company valued at $26.35 billion. The company had a scandal with melamine contamination of their milk, but since then they have been sure to be extra careful and have been very socially aware. Yili Group was a sponsor for the 2008 Olympics in Beijing. Yili Group’s stock is currently trading for 32.97 per share

Want Want China Holdings Ltd. is a huge company in China with 32 sales branches and over 329 sales offices. The company also has operations across the globe. The company sells rice crackers, dairy, beverages, leisure products, alcohol and many other products. Want Want has strong name recognition and is very well known and respected in China. Want Want China Holdings Ltd. has a market cap of $79.65 billion and their stock is currently trading for $6.03 per share.

These Chinese food producers and distributors are very good at what they do. Whether they are involved in dairy, groceries stores, liquor distribution or rice crackers; they have all found a niche and they are dominating their respected markets. Many people pick up oriental food from the grocery store, but does anyone really pay attention to where their noodles and sauces are coming from? Some Chinese food companies have their hands deep into world markets. Whatever the case, the popularity and profit margin of these foods are working out for the big Chinese food producers. Be sure to check for a ‘Made in China’ sticker on the next package of rice or noodles you pick up at the super market. It may very well make your Chinese food more Chinese.

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China Computer Companies on the Prowl

China Computer Companies on the Prowl

Nanjing Panda Electronics Company Ltd (Public, SHA:600775), China Greatwall Computer Shenzhen Co. (Public, SHE:000066) and Hedy Holding Co., Ltd. (Public, SHE:002027) are all involved in the research, development and sale of computers. Through state-of-the-art projects and expert marketing, these companies are taking over the Chinese computer market.

These companies are involved in selling computers domestically and abroad. They are relying on Chinese citizens to buy their products so that they can bring their products to other countries. This is happening and has already happened with some companies, but as consumer spending grows in China, so will these companies’ bottom lines.

Nanjing Panda Electronics Company Ltd manufactures, develops and distributes computers on a wide scale basis. The company is also involved in communication equipment, technology services and electronic devices. Nanjing Panda Electronics provides mobile communication products, satellite communication products and electronic manufacturing products. Nanjing Panda Electronics Company Ltd has a market cap of $5.12 billion and their stock is currently valued at 7.81 per share.

China Greatwall Computer Shenzhen Co manufactures and sells computers and computer components. The company also provides software, hardware and network systems. Aside from computers, China Greatwall Computer creates LCD televisions, plasma televisions and are distribute these products in the Americas, Europe, Africa, Australia and Japan. China Greatwall Computer Shenzhen Co has a market cap of $9.17 billion and their stock is currently valued at $8.33 per share.

Hedy Holding Co., Ltd. Is one of the fortune 50 electronic information companies in China. They design, distribute, manufacture and deliver their products domestically and overseas. They also market CRT and LCD displays, mobile phones, keyboards and mice. Their products are ranked #5 in China and #1 in South China. Hedy Holdings relies heavily on their team of R&D engineers who take ideas and turn them into reality. The company is poising to expand their company worldwide. Hedy Holdings relies on repeat business and very good customer service. Hedy Holding Co., Ltd. has a market cap of $1.77 billion and their stock is currently valued at $5.86 per share

These computer manufacturers are developing relationships across the globe and dominating the markets that they are already involved in. Fighting for market share in their back yard has proven to be their niche, but can they bring the fight to the global market and win? Going against IBM, Microsoft, Dell, HP and Apple might not be as easy as these companies may make it seem. Hopefully they will bring their boxing gloves to the global market, because they are going to need them.

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The Backbone of China’s Industrialization

The Backbone of China’s Industrialization

China Natural Resources Inc. (Public, NASDAQ:CHNR), China Mining Resources Group Ltd. (Public, HKG:0340) and Hunan Nonferrous Metals Corporation Ltd. (Public, HKG:2626) are companies that mine resources in China to help fuel the country’s 8% GDP growth. These companies supply their country’s need for natural resources and some have a place in their heart for community.

Natural resources are definitely abundant in China. These resources include; iron ore, coal, aluminum, natural gas, petroleum, magnetite, mercury, manganese, lead, tin, vanadium, molybdenum, uranium and much more. China is also one of the largest producers of zinc, antimony and tungsten. Molybdenum is a very import commodity because it has an extremely high melting point of 2,625°C. This is useful because it is used as an alloy agent in steel cast iron and super alloys. There are also few substitutes for molybdenum. The most profitable minerals to mine in China are probably natural gas and petroleum. These companies are proving that there is money to be made in feeding the dragon, and they are doing a fine job so far.

China Natural Resources is engaged in the exploration, processing and exploitation of minerals domestically and internationally. The company sells a wide range of natural resources with an emphasis on quality. CHNR has its headquarters in Shenzhen, China. The company supplies iron concentrate, zinc concentrate and micaceous iron oxide powder. CHNR shut down a copper smelting plant in Inner Mongolia that provided blister copper, silver, gold and sulfuric acid. The idea was to concentrate working capital on the more profitable core coal, iron and nonferrous metal mining business. The company is now concentrating heavily on exploration in order to ramp up production. China Natural Resources Inc. has a market cap of $235.19 million and their stock is currently valued at $10.35 per share.

China Mining Resources Group Ltd. Concentrates on mining and processing mainly molybdenum, copper, zinc and other metal products. The company is based in Harbin, Heilongjiang Province, PRC. Strangely enough, this company is also involved in the sale and cultivation of tea products. And by tea, I mean green tea, black tea, oolong tea and jasmine tea. The company enjoys its social responsibility to the well-being of the Hong Kong community. China Mining Resources Group makes sure to promote activities that emphasize their relationship with all of their stakeholders on economic, social and environmental issues. The company has spent RMB 1.17 million so far to rebuild two elementary schools that were destroyed by an earthquake. China Mining Resources Group Ltd. (Public, HKG:0340) has a market cap of $1.28 billion and their stock is currently valued at $0.208 per share.

Hunan Nonferrous Metals Corporation Ltd. focuses on the production and sales of nonferrous metals. The company holds mining rights in Hunan Province to mine for lead, zinc, tungsten, antimony, bismuth and fluorite and is listed as one of the Top 500 China enterprises. Hunan Nonferrous is a service provider for many types of nonferrous metals and integrates smelting, R&D, mining and surveying into its operations. The company also owns “the fourth largest scheelite mine in the world”. The company has 10 subsidiaries and is striving to build a good international financial platform. To learn more about this company, visit their website, at http://www.hng.com.cn/English/Index.asp. Hunan Nonferrous Metals Corporation Ltd. (Public, HKG:2626) has a market cap of $9.39 billion and their stock is currently valued at $2.56.

These 3 companies are proving to be the backbone for the manufacturing capacity in China. It is because of their hard work and high output that China’s economy is allowed to grow so quickly. The technology that these companies are putting in place are shaping the way they will operate in the future. Without these vast resources, China could easily slip away from what it once had. The Japanese do not have very many resources on their islands, but their innovation and ingenuity allow them to prosper. The Chinese are in a better starting position with all of their resources. Natural resources will continue to be the backbone of the red dragon, at least until the economy reaches a point where it can cool down. Once this happens, post-industrialization needs are bound to erupt in China.

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The American Rule, Alive and Well in China

The American Rule, Alive and Well in China

Industrial and Commercial Bank of China (Public, HKG:1398), China Construction Bank Corporation (Public, HKG:0939) and Bank of China Limited (Public, HKG:3988) are all big finance in the world’s largest economy. From corporate banking to banking through a mobile phone, these dragons are moving from continent to continent, creating relationships and taking names.

These companies are the big players in China and around the world. They have opened up their doors to markets in countries thousands of miles away from the mainland. Some of these banks are concentrating on a relationship building strategy, while the others go after technological advances and proprietary advancements. Either way, there is a market to be captured due to the fact that other banks have practiced liberal lending standards and have been caught red-handed holding troubled assets and dragged the rest of the world halfway into a recession. These Chinese banks are doing what any conservative banking institution would do, lending to credit-worthy customers.

Industrial and Commercial Bank of China (ICBC) provides personal banking services, personal financing, corporate banking services, international financing, fund management, investment banking and much more. The company is very certain about its future and is actively promoting its international development strategy. ICBC has a 20% stake in Standard Bank of South Africa and has a stake in Seng Heng Bank of more than 79%. The company has branches across the world, which includes; Sydney Branch, New York Branch, Middle East and Doha Branch. By the end of 2008, ICBC established business institutions in 15 countries. The company has relations with 1358 overseas banks in 122 countries and regions around the world.

ICBC is heavily involved in e-banking with respect to a trading volume in 2008 of RMB 145.29 trillion. The company launched their second generation USB-Shield to further protect their clients from e-sharks. ICBC provides its clients with mobile banking and Personal Internet Banking. The company has 1.44 million clients for corporate internet banking in 2008 and 56.72 million personal internet banking clients. ICBC possessed 72 patents with respect to intellectual property which represented 55% of all patents in the industry. Industrial and Commercial Bank of China has a market cap of $2.01 trillion and their stock is currently valued at $6.01 per share.

China Construction Bank (CCB) is involved in corporate banking, deposit, credit loan, asset custody, annuities, trade financing, international financing, personal banking and various other services. The bank operates domestically in China and overseas as well. The company thought about expansion early on, but really got going in 2006 when it bought Bank of America’s Asia division. CCB is part of the Global ATM Alliance which allows people to use their ATM cards around the globe at other participating banks. The alliance includes Barclays, Bank of America, BNP Paribas, Deutsche Bank, Santander Serfin, Scotiabank and Westpac. In 2009, CCB opened a branch in New York City after having received approval from the NY State Banking Department and the Federal Reserve Board. China Construction Bank Corporation has a market cap of $1.58 trillion and their stock is currently valued at $6.77 per share.

Bank of China Limited (BOC) was founded in 1912 to replace the Government Bank of Imperial China. It is the oldest bank in China and now operates around the world. The bank operates in corporate financing, personal savings, loans, asset management, annuities, insurance and investment banking just to name a few. BOC offered the first credit cards in China in 1986 and the first telephone banking in 1991. The company was listed on the Hong Kong Stock Exchange in 2002 and a move towards reform in the banking industry. Aside from owning the 7th largest building in the world, BOC operates in 27 countries around the world. Bank of China Limited has a market cap of $1.07 trillion and their stock is currently trading for per $4.21 share.

These companies represent a change in attitude domestically and around the world. No longer will Chinese companies be strictly domestic. These companies are going around the world looking for someone who needs a loan or easier access to money. From e-banking corporate financing, these companies are diversifying their portfolios and opening up a check book when the rest of the world lies in a recession. These companies are definitely pursuing the concept that China is the economic front runner of the world. Other banks are not able meet the needs of their customers because they are tied deep into a recession with the rest of the world. Whatever the reason, it is now China’s time to turn the tables.

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