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From: Matthews Asia <info@matthewsasia.com>
Date: 11 May, 2012 10:35:06 AM PDT
To: <computerdiy@yahoo.com>
Subject: Weekly Asia Update: Postcard from Shenyang, China
Weekly Asia Update
May 11, 2012
Neighbors fish in a pond near residential high-rise apartments in Shenyang, China.
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Postcard from Shenyang, China
When people think about China, they typically think about cities like Beijing or Shanghai. But there are a number of lesser-known cities with populations as big as (or bigger than) New York. My hometown of Shenyang is one of these cities. Largely left behind during the country's economic reforms of the 1980s and early 1990s, Shenyang has more recently started to attract some attention for the comeback it has made.
Considered a "second-tier" city, Shenyang is the largest city in China's far northeastern region with a population of approximately 8 million. It is the capital of Liaoning Province, and was famed as a titan of heavy industry during China's early development when it housed many large state-owned industrial enterprises. Under China's system of a planned economy, Shenyang was a proud industrial city. But when China began undergoing massive economic reforms, the city was slow to adjust to the free market economy and lagged behind. In the mid-1990s, many factory workers lost their jobs and took to the streets in protest. It wasn't until 2003 that the central government planned for the revitalization of the entire northeastern industrial region, issuing policies that benefited the city.
I return to Shenyang almost every year to see family and friends, and each time I'm happy to see positive changes. Shenyang's Tiexi District, once dotted by tall chimneys during its industrial glory days (despite having had some of the highest pollution in all of China) is now one of the city's most coveted residential neighborhoods. Most factories have moved to the outskirts of the city and production methods are increasingly being upgraded to meet environmental protection standards. Many new apartment buildings have been developed and attention has been paid to beautifying the landscape.
On my recent trip to Shenyang, I stopped by the city's "Golden Corridor," a commercial street which connect the city's government square to the airport and now boasts high-end luxury brand stores. An underground shopping plaza connects to subway lines and a gourmet supermarket, and the area is drawing the interest of many major domestic and Hong Kong-based commercial developers as it receives strong foot traffic.
During my trip, I also visited some forward-thinking companies, including a software company that is working on paperless solutions for hospitals; a high-tech robotics firm; and a coal mining machinery maker, which recently expanded its production capacity to take advantage of Shenyang's vast pool of skilled workers. Shenyang has done well in making a comeback and even taken that transformation a bit further. It has managed to maintain its industrial roots while still finding ways to go upscale.
Hardy Zhu
Research Analyst
Matthews International Capital Management, LLC
You should consider the investment objectives, risks, charges and expenses of the Matthews Asia Funds carefully before making an investment decision. This and other information about the Funds is contained in the prospectus, which may also be obtained by calling 800.789.ASIA (2742). Please read the prospectus carefully before you invest or send money as it explains the risks associated with investing in international and emerging markets. Investing in international and emerging markets may involve additional risks, such as social and political instability, market illiquidity, exchange-rate fluctuations, a high level of volatility and limited regulation. Fixed income investments are subject to additional risks, including, but not limited to, interest rate, credit and inflation risks. In addition, single-country and sector funds may be subject to a higher degree of market risk than diversified funds because of concentration in a specific industry, sector or geographic location. Investing in small- and mid-size companies is more risky than investing in large companies as they may be more volatile and less liquid than large companies.
The subject matter contained herein has been derived from several sources believed to be reliable and accurate at the time of compilation. Matthews does not accept any liability for losses either direct or consequential caused by the use of this information.
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