外文翻译--WTO对中国房地产市场的影响.doc

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1、The Chinese Real Estate Market and the effects of WTO Chinas impending entry in the World Trade Organization (WTO) will be a blessing to the real estate industry in China which has had little to celebrate since the bustling days of the early-mid 1990s. WTO entry sends a positive message to foreign c

2、ompanies about Chinas commitment to economic and market reforms. Demand from foreign companies - the primary occupants of top-quality commercial, industrial and residential projects is likely to increase as new companies enter the market and others expand as restrictions are gradually lifted. It is,

3、 however, premature to say exactly how much the real estate market will benefit. To predict that WTO entry will mean rising rents and demand for more construction in the short term is, perhaps, misguided. The details of the agreement are not yet known, and it is likely that the impact will be gradua

4、l and unevenly spread amongst businesses and in different areas of China. Financial services, telecommunications, distribution and logistics, information technology, agriculture, and professional services industries, as well as Chinese consumers, are likely to be significant winners.Metropolitan are

5、as may see benefits due to easing of restrictions on financial services companies. Banks and insurance companies are a major industry sector in these areas, and the lifting of restrictions on their activities could unleash significant latent demand for real estate as the reforms take hold. The lifti

6、ng of trade restrictions, the lowering of tariffs and the easing of restrictions on distribution over the next five years will be a boon for warehousing, logistics and distribution real estate in Chinas busiest port city, as well as in the rest of China.While WTO entry may encourage a recovery in re

7、al estate markets sooner than otherwise expected, almost every major market in the country remains vastly overbuilt. In the office sector, the vacancy rate for Grade A buildings is presently 30% in Beijing and 38% in Shanghai. Based on recent trends in demand, this vacant office space will take two

8、to three years to be absorbed, and there is more construction underway.China will continue to reap economic rewards from the comprehensive package of housing reforms that the central government has been continually introducing. The most recent development in the new policy is the replacement of mone

9、tary subsidies for welfare housing distribution. This new move builds on the 1998 directive, which ended the provision of subsidized housing to public servants. The reforms, coupled with an increased readiness on the part of banks to grant residential mortgages, are expected to promote the sale of h

10、ousing and facilitate housing construction. While it is Chinese citizens who will benefit most from the housing reforms, foreigners may also have the opportunity to participate in the real estate boom. Foreign banks are seeking permission to compete in the huge mortgage market and purveyors of build

11、ing materials, furniture, household appliances and interior design services are now honing in on the Chinese market. Any restrictions or conditions to which foreign companies are presently subject are likely to be relaxed or lifted completely upon Chinas accession to the World Trade Organization. Th

12、is strong socialist principle of state ownership of real property has been somewhat circumvented by the introduction of land-use rights. A land-use right is created when the owner of the land (the State or a collective) separates one or more of the rights of possession, use and benefit from the comp

13、lete right of ownership and grants them to another legal person. Land-use rights in practice are acquired by way of a grant or by means of allocation by the State. The rights exist for a definite term ranging from 40 years for commercial, tourist and recreational purposes to 70 years for residential

14、 purposes. The land-use rights holder may then exercise the rights granted, but the land must be used in accordance with the land-grant contract. An amendment to the Constitution in 1988 confirmed that the rights to the use of land may be transferred in accordance with law. Depending on the stipulat

15、ions of the land-grant contract, and the extent of the rights granted the holder may have a right that is practically the same as ownership, albeit for a limited time. Thus, notwithstanding the socialist tenet that there shall be no private ownership of land, an ordinary Chinese citizen may legally

16、own his house, and, in conjunction with an appropriate land use right, may for all intents and purposes own the land and everything above it. Accordingly, a Chinese real estate market that trades land-use rights coupled with the structures on the land has gradually evolved. Central to the new housin

17、g policies is the desire of the Chinese government to facilitate the purchase of housing by Chinese citizens. This deviation from traditional socialist principles is aimed at bringing about increased consumption, a broadening of employment opportunities and the renewed availability of government res

18、ources. Most provinces, autonomous regions and municipalities have already formulated schemes for the sale of public housing to individuals. To date, approximately 60 per cent of such housing has been sold nationwide. Political and ideological notions aside, the recent housing reforms have had vast

19、economic ramifications. Chinas fledgling real estate market of the early 1990s has now blossomed: over the past two years, investment in real estate has been growing by 20 per cent per year. 401 billion Yuan was invested in real estate development nationwide in 1999. Housing construction has increas

20、ed dramatically and it is predicted that at least 55 million square meters of floor space will be added year-on-year until 2010. In response to both government initiatives and market trends, banks will endeavor to increase the number of loans granted for real estate purposes. The balance of such loa

21、ns by Chinas state-owned commercial banks reached 355.6 billion Yuan by the end of 1999. Commercial banks will also focus on making a greater amount of housing mortgage loans available to individuals in 2000. The projected target for such loans is 100 billion Yuan. The Peoples Bank of China has pled

22、ged to strengthen supervision of the granting of housing loans. The China Construction Bank has gone one step further than its competitors by announcing that the grant of housing loans in Chinas central and western areas will be accorded a special priority.Inevitably, the housing reforms are not fre

23、e from all difficulties. The gradual evolution of a market economy in China has cracked the iron rice bowl. With the demise in prominence of state-owned enterprises and the rebirth of the private economy, Chinese workers can no longer expect lifetime employment. And now, with the introduction of a m

24、onetary subsidy, Chinese citizens can no longer bank on the security of welfare housing. Will this hold back any foreseeing boom?A real estate boom in China will inevitably fuel the national economy, providing indirect benefits to all foreign investors. But it is overseas real estate developers who

25、are poised to reap the most gains, for they already enjoy preferential treatment by way of exemption from investment regulatory taxes, easy access to fund-raising and freedom to remit profits abroad.High demand and profit potential in Chinas housing market make the industry a key investment target f

26、or foreign financial institutions, who will offer real estate developers financial services ranging from feasibility studies to consulting, the article said. Most investment would go to the residential housing market, and increasingly in Chinas medium-sized and smaller cities, the article said. Chin

27、as idle office construction industry will be a direct beneficiary of the mushrooming of foreign-invested factories and branch offices likely to follow in the wake of Chinas WTO entry, the article said. Chinas domestic building materials industry, however, which has few key products and minimal expos

28、ure to international markets, will be negatively impacted by Chinas entry to WTO. But domestic developers would benefit from the downward pressure on building materials, and Chinas accession would lower import tariffs. Cheaper materials will bring building costs down, so housing costs should fall as

29、 well. In the medium to long term, the institutionalized reforms required by WTO rules are likely to have a positive impact for real estate investors and occupiers as a result of increased business activity and the more systematic development of Chinas economy as a whole. The commercial and resident

30、ial markets are overbuilt because too many developers rushed into China at the same time, and the strong demand was just not enough to fill the space. WTO will be a boost on the demand side, and may just fulfill some of the hopes that investors had when they came to China. Like the commercial market

31、, the expatriate housing market will be positively affected. While certain companies have been reducing expatriates in the last several years (or at least the proportion of expatriates to overall employees), the wave of new companies coming to China will likely bring more senior expatriate managers,

32、 however according to the AmCham 2000 Housing Survey, foreign companies plan not to hire as many expatriates in the upcoming year. WTO will have a positive effect on the market and there will be more expatriates entering China from smaller or medium sized businesses. Its not all hype. Some economist

33、s believe that WTO membership is being over publicized, but others see it as the answer to Beijings real estate problems. It is generally believed that Chinas pending entry into the World Trade Organization will be a blessing for Beijings real estate market, which has been depressed since the econom

34、ic boom of the mid-1990s. As China began competing on the global market, it became clear that meeting international standards for quality and comfort were crucial. The message was clear: You may choose to cut corners, but your competitors may not. The capitals commercial real estate market has been

35、on a dizzying roller-coaster ride for the past decade. At its peak, roughly around 1994, Beijings rental market was on par with the worlds major financial centers. But just six years later, prices have plummeted and there is debate over whether the bottom has been reached. Although Beijing seems lik

36、e it is under permanent reconstruction, it is only comparatively recently that the incessant cacophony of banging and drilling took over the capital. A major government policy change in 1992 provided overseas investors with preferential incentives to invest in Beijing commercial real estate, which q

37、uickly resulted in the capital becoming one of the worlds most expensive rental markets. Previously, foreign companies and foreign residents were extremely restricted by the number of hotels, housing and office complexes available to them. However, by late 1994, a surge of new buildings began croppi

38、ng up across the city and Beijings real estate market peaked. Early 1995 offices occupied 100 percent and office space was at a premium. Office complexes were charging over US$140 per square meter per month. However, the boom didnt last. After the initial frenzy, rental prices started to slip before

39、 plummeting by as much as 30 percent a year. But investors began to tire of Chinas meager return on investment. The decline was triggered by a slew of factors, not the least of which was the Asian financial crisis of 1997-99 and the reluctance of foreign multinationals to continue pumping money into

40、 a saturated market. Oversupply remains a problem, with an estimated 20 percent to 30 percent of commercial real estate remaining vacant. But how long before demand equals supply is subject to debate. While some market analysts believe 1999 was one of the most active years in recent memory, others i

41、nsist that the market is still sluggish. However, overall the advent of WTO membership has brought about a general feeling of optimism. As a result, rental fees are once again expected to rise and vacancies decrease. The commercial sector has turned around very quickly and rents are going up. The 37

42、-story China World Tower II, which opened last October, only has three floors available for rent. The building began with 58,000 square meters of empty space. For domestic companies in real estate, a large and steady inflow of foreign investment will be crucial to reforming state-owned enterprises.

43、Reform is invariably going to lead to the closure of many inefficient enterprises. But the good news is that increasing demand is coming from local private businesses. More and more domestic companies are moving into Grade-A office buildings, which previously had only been occupied by foreign compan

44、ies. In the second half of last year, 60 percent of the demand for rental space came from Chinese companies. This development was fueled not only by declining rental fees, but also by a push among Chinese companies to upgrade their image. In addition to shifts in rental costs, the quality of project

45、s in Beijing has improved considerably over the last several years. Increased competition has made developers realize that there is a demand for quality. Therefore, in addition to modern facades and grandiose, marble-laden lobbies, a significant number of technical improvements have also been made.

46、Higher ceilings, faster elevators, year-round air conditioning, and ample daily and back-up electrical power are just some of the improvements included in newer buildings and renovations. Multinational companies in Beijing can finally see that the office market has matured, maybe not fully, but at l

47、east to the point where there is some value for money. So the market is ready for the demand expected from the influx of expatriates resulting from the WTO. Its all a matter of time when the agreement is signed. The signing of the bilateral trade agreement between China and the United States on Nove

48、mber 15, 1999 opened the way for Chinas accession to the World Trade Organization in the near future. Chinas real estate market will greatly benefit once China gains entry into the WTO for the following reasons: 1. Low tariffs help to lower construction costs and hence housing prices.Since 1992, imp

49、ort tariffs in China have been lowered five times from an average level of forty-three percent to the present level of seventeen percent. Tariff rates will be further reduced and certain import restrictions will be removed with Chinas entry into the WTO. At the moment, most medium to high-end building materials and construction machinery, for example, lumber, interior decoration materials, sanitary ware, insulation materials, elevators and electrical products are imported. L