In the second quarter this year China’s gross domestic product grew at 6.2%, which is the lowest growth since 1992 and down from 6.4% in the previous quarter according to figures released by the government earlier this week. The Chinese National Bureau of Statistics of China expects this downward pressure to continue due to the slowing global growth and trade war with the US. While China´s exports fell 1.3% during the first half of this year, imports dropped even harder with 7.3%.
The Economist Intelligence Unit of China reported that the uncertainty caused by the US-China trade war was an important factor and will be in near future. Businesses could remain skeptical that the two countries will reach a broader trade agreement and trade tensions may escalate again.
This year, CPhI China took place in Shanghai on 18.-20. June. As it is the main event in the pharmaceutical industry throughout Asia, our Shanghai and German team participated the event. The CPhI fair combines all key suppliers and customers in the chemical and pharmaceutical industry. Petrex took the chance to strengthen existing relationships with producers and clients and to create new business opportunities.
In fact, this year’s fair was very successful for Petrex as our team laid the foundation for new projects in our API business. We wish our business partners all the best and hope to see you again soon.
In recent weeks we got nice and warm weather with lots of sunshine in our headquarter in Kempen. The new guys in our team integrated quickly and business is running good. But not only the team in our office is growing. We got some new pets in our garden that perfectly match with our veterinary division.
Best wishes and a much sunshine to all our business partners from TEAM PETREX!
On May 10th, the United States increased tariffs on USD 200 billion worth of Chinese goods from 10 to 25 percent. China, in return, announced to increase tariffs on USD 60 billion worth of US goods from June 1, and additionally threatened to take qualitative measures that would affect US businesses operating in China.
Since the trade war started in 2018, the exports of both countries dropped massively. Less availability and higher prices not only affect companies but also private households. And this damage is not limited to China and US. According to a study published by the European Union Chamber of Commerce in China on May 20, one-third of European companies are hit hard by the US-China trade war. Contrary to expectations that EU-companies would benefit from the dispute, they are now suffering, as the global economic slowdown leads to declining exports of companies in Europe.
Petrex has its teams in Germany and China. But actually it is one international team rotating between Kempen and Shanghai. The ever changing regulations in international trade as well as the industries we operate in, require us to always rethink our processes. By sending our German and Dutch employees to China and inviting our Chinese colleagues to Germany we intend to exchange our knowledge, ideas and thoughts. We believe that this continuous exchange gives us a better understanding of the needs of our clients and suppliers as well as the general regulations in our business.
Labour day is a well known holiday in the West to celebrate the working class. It is usually held on May 1st every year. In China, though, this holiday lasts for three whole days instead of just one day, which turns it into yet another long weekend break for the Chinese.
Based on the Western Labour Day holiday, which originated in Europe during 1891, Labour Day or “五一” (Wǔ Yī) was designated as a public holiday in China in 1949. From year 1999 to 2008 it was even a 7-day public holiday known as the third Golden Week in China. However, it was reduced to 3 days in 2008 to make way for other traditional festivals like Qingming or Dragon Boat Festival.
Although Labour Day is no longer classified as a Golden Week in China, it remains a peak travel period for Chinese. According to China’s Ministry of Culture and Tourism around 150 million Chinese are traveling during those days.
No more snow.
Days are getting longer.
SPRING IS COMING!
Best wishes from team Petrex!
The Chinese economy has been slowing in recent years. As part of a 2 trillion RMB package the Chinese government seeks to reduce costs, especially for businesses affected by the tariff dispute with the US.
According to the announcement made by the government on March 5, China’s VAT rates change as follows:
– The 16 percent VAT rate, which applies to the manufacturing sector, will be lowered to 13 percent;
– The 10 percent rate, which applies to construction and transport, will be lowered to nine percent; and
– The six percent rate, which applies to services, will remain the same, but more deductions for the bracket will be introduced.
The new VAT rates came into force on April 1, 2019
Petrex recently expanded its business of supplying photo initiators to various customers in Europe. Photo initiators are used in industries like coating and ink. It is supplied as a thin layer on the supporting material and then cured by brief exposure to UV light to harden the ink or coating.
The two-yearly European Coating Show is a must event for the coating industry. In 2017 more than 1.000 exhibitors from 49 countries and over 30.000 visitors from 120 countries participated. The exhibition covers the fields of paints, coatings and sealants. On three days, exhibitors and visitors will be able to discuss the latest developments within the industry.
Team Petrex is looking forward to strengthen its partnership with suppliers and customers as well as creating new business opportunities through this event.
Petrex manages supply chains of chemical and pharmaceutical products for business partners all around the world. Many of our products are sourced from Asia and provided to customers in Europe and America. Therefore, a close focus on international regulations and current political discussions is essential to estimate risks in our trading business.
Since we also supply to the UK, business partners often ask us about consequences of Brexit. Many companies in the UK as well as foreign investors are spending less and scaling back plans because of Brexit fears. Petrex maintains long term relationships with customers in the UK and already created concepts for different Brexit scenarios. Many of our British customers are operating in niche markets. That is why we are confident that their business situation will stay as strong as it is today.