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Another Indian trader goes missing in Yiwu

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An Indian trader has gone missing in the Chinese town of Yiwu, after an unidentified man took him away from a local restaurant, in an incident that is set to trigger a fresh commercial and diplomatic dispute, amid already rising strains between India and China regarding the safety of businessmen in the southern trading hub.

Indian officials told The Hindu the trader from Mumbai, who was in Yiwu on a temporary visa, was taken away on the night of May 19. He has remained unreachable since then.

Two Indian traders, who were accused of owing Chinese suppliers 10 million RMB ($1.58 million), were kidnapped in December, and held for more than two weeks, before Indian officials pressured Chinese authorities to arrange for their release. Their case is now being heard at a local-level court in the nearby town of Jinghua.

The kidnapping of another Indian is set to further strain ties, particularly after the Chinese Foreign Ministry on Tuesday hit out at an advisory issued by the Indian Embassy here a day earlier, warning Indian businessmen of the dangers of doing business in Yiwu, a major trading hub in the southern Zhejiang province, after fresh cases were filed against the two traders.

“The Indian Embassy’s advisory isn’t conducive to resolving the relevant issue, and will also affect normal trade and economic exchanges between China and India,” Foreign Ministry spokesperson Hong Lei said at a briefing.

“We hope that India will view China’s handling of the case in a rational way,” he said, adding that China “always safeguards the legitimate interests of foreign businessmen, including Indians”.

Mr. Hong, in a briefing in March, called on Indian traders to honour their compensation commitments. The traders argued at a court hearing last month that they were only employees of the trading firm that owed the dues, with the Yemeni owner missing. One of the traders, Deepak Raheja, told The Hindu on Monday the traders had presented documents supporting their case to the court, and they had been hopeful of a favourable verdict.

A fresh case filed by suppliers in Yiwu at a local court in January, accusing the two Indian traders of owing a further 1.6 million RMB (Rs. 1.39 crore), triggered Monday’s advisory from the Indian Embassy, which warned of “a high possibility of fresh cases being lodged in order to exert additional pressure on Indian businessmen.”

The circumstances surrounding the disappearance of another trader from Mumbai on May 19 are still unclear, although indications are that his trading company had run into a commercial dispute with suppliers in Yiwu.

Dozens of foreign businessmen are reported to have been held captive by Yiwu traders when deals encounter problems. They are usually released after dues are settled and cases usually aren’t made public. Indian traders who are based in Yiwu have played down the cases, describing them as the norm in the entrepreneurial and often lawless business environment in many parts of southern China.

One Indian trader, who spoke to The Hindu, said kidnappings happen “only if you owe large sums of money.” “If you pay your dues, there is no problem, and Yiwu is a place where you can do a lot of business,” the trader from New Delhi said.

He added that several traders had expressed concerns regarding the advisory issued by the Embassy. “You cannot say the whole town is a bad place to do business because one or two people haven’t settled their dues,” he said. “We worry that this will harm the good business that several hundred Indian traders are doing here, with no problems.”

Indian officials said they have received panicked calls from more than half a dozen Indian businessmen in Yiwu, Shaoxing and some other trading hubs in Zhejiang and neighbouring Guangdong in the past year alone, after traders were held hostage because of payment disputes.

“Perhaps, this is a feature of doing business in the Pearl River Delta,” said one official in an interview earlier this year, referring to China’s southern manufacturing and trading heartland.

The incident may trigger a fresh dispute between India and China

Circumstances of the disappearance still unclear

Yiwu : Unscrupulous foreign traders get way with unpaid dues, credit system questioned

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The economic crisis and regional instability will affect the Yiwu small commodity exports. In fact, from Yiwu ‘foreign strategic shift has already begun.

In December 2011, Yiwu India disputes between traders and Commodity City business operators, causing a small storm.

The event from a Yemen unscrupulous traders to cheat Yiwu merchants tens of millions of goods after on foot, two Indians of their employees, Yiwu merchants dispute process is to recover arrears and two Indian businessmen have already left Yiwu, Yiwu merchants damage to tens of millions of dollars of goods, including the loss of 307 million.

The data show that of Yiwu Municipal Public Security Bureau of Economic Investigation Team: 2011, Economic Investigation Team received a report reflect the escape and hide or owed money the company has 80, including 53 foreign, involving 21 countries, including India, the largest of nine accounting for 17%.

Credit mode needs to be improved

‘In a county-level city, Yiwu foreign-related cases is certainly the most GONG Weidong, Yiwu Public Security Bureau of Economic Investigation Team, told << Zhejiang >> reporter, Yiwu small commodities to the world, and foreigners doing business at the same time, is the coexistence of opportunities and risks, to Yiwu to bring a series of challenges on the issue of handling foreign-related disputes, to prevent trade fraud(http://www.agile-news.com/).

‘Yiwu every year tens of millions of dollars of goods have been cheated by unscrupulous traders, mainly because of the trade in Yiwu, mostly on credit, pay a small deposit delivery after payment.’ China Commodity City Group General Manager Wu Bo into said such transactions have to play an active role in the Yiwu market, the development process, but there are also some drawbacks, not lead to a small number of unscrupulous foreign after receiving payment on foot.

Wu also believes that nothing out of the case caused by economic disputes, and finally suffered a loss of foreign cheated by unscrupulous goods merchants. For the escape of a small number of unscrupulous foreign-volume goods, China Commodity City has with the local Economic Investigation Brigade cooperation, the establishment of early warning platform, purchase business credit investigation, timely, published online to remind Yiwu dealer Note.

Trading environment for foreign businessmen in Yiwu, the ‘foreigner why to Yiwu to? Yiwu has something to attract them.’ Wu Bo Cheng said that Yiwu is the world’s largest commodity distribution center, commodity resources, profit margins, favorable business environment advantage of the policy environment for optimization and security environment, to attract customers around the world.

, Yiwu has become one of the largest commodity export base in China, the goods have been exported to 215 countries and regions, there are 3008 foreign enterprises from 89 countries set up a representative office in Yiwu, the world’s 20 leading shipping companies( News http://www.agile-news.com/). there are 18 to establish an office in Yiwu.

In 2011, China Commodity City turnover of 51.512 billion yuan, an increase of 12.95% exceeded 50 billion yuan mark for the first time.

‘Stay in Yiwu

Chamber of Commerce president of the China Commodity City (Yiwu) daily floor Zhongping Jian letter, business behavior is ‘talk.’, As long as there was money to foreign investors will still continue to come to Yiwu Indian Embassy warning on January 3 all Indian businessmen do not do business in Yiwu, but the event seems to be limited impact on trade between India and the Yiwu businessmen.

65-year-old La Meixi, hi into Co., Ltd. Yiwu head of the Representative from 1964, he went to Indonesia, Thailand and Hong Kong, China, Taiwan’s business.

In 2002, La Meixi by a multi-year cooperation with customers invited to come to Yiwu Yiwu, he decided to take root in Yiwu, mainly to do stationery, gifts, shoes, artificial flowers business in the Indian businessmen in Yiwu, he big business, he said, Yiwu market is very rich commodity, the price is very edge, we can say is inexpensive. ‘elsewhere.’

Lamei Xi said he had heard the Indian businessman suspected of defrauding the goods things, but he is convinced that this is only the Indian traders doing business in Yiwu individual phenomenon, Most Indian businessmen to business integrity.

Lamei Xi said, it also reminds the Yiwu market, the majority of business operators to pay attention to risk prevention, for example, to appropriate a certain amount of deposit to avoid the credit when doing business with foreign investors. As for the business environment of Yiwu, La Meixi own personal experience to prove Yiwu’s business environment is very good, not, as some rumors.

‘I am in Yiwu ten years, has never occurred with the Chinese business operators economic disputes, Yiwu Municipal Government and Yiwu people are very concerned about foreign enthusiasm, always put themselves in for the sake of our very safe to do business in Yiwu, which is what I stay in Yiwu, the most important reason for selecting the final. In addition, Yiwu, good social order. In the future, I will remain to do business in Yiwu. ‘said La Meixi.

Orders transfer of foreign trade

According to Customs officials, in 2011, Yiwu Customs export Commodity $ 9.87 billion, an increase of 15.1 percent over the same period last year, commodity export cargo of 8.402 million tons, down 6.8%, annual export value increased significantly, but total exports has decreased, showing the price of an incremental reduction trend.

Experts said that in 2012, Yiwu export situation is still not optimistic. First, the increasingly complex international situation, the Middle East and political turbulence persists, the U.S. economic recovery is slow, the debt crisis in Europe still have not found an effective solution. Raw material prices, labor prices rise phenomenon of, and appreciation of the renminbi will continue to exist, the cost of doing business is still severe pressure.

In Yiwu, almost all businesses are aware that in 2012 the world economic environment, there are many uncertainties, the economic crisis and regional instability will affect the Yiwu Commodity exports. In fact, from Yiwu ‘foreign strategic shift has already begun.

The Middle East has been occupied Yiwu small commodities export share of more than 1/3 the weight. Since the Libyan war broke out last year, the situation in the Middle East continued instability, which directly affect the normal export of Yiwu .2011 years of Yiwu Yiwu customs export in the Middle East $ 3.49 billion, an increase of 7.3%, but export cargo fell significantly, total exports of 325.1 million tons, down 11.3 percent.

Among them, the most affected is undoubtedly just experienced war in the Libyan market .2011 year, the sharp drop in Yiwu Commodity exports to Libya, with exports of $ 43.25 million, 39,000 tons of export cargo, plunged by 63.7 percent and 67.7 percent year on year.

The same time, Yiwu foreign trade market, the gradual emergence of a new growth point Yiwu Commodity exports to Russia, India, Brazil, South Africa, four BRIC countries last year, an increase of 52.1 percent, 37 percentage points higher than the overall export growth in the developed economies last year downturn, the sharp decline in demand, the BRIC countries show strong economic growth momentum, Yiwu Commodity exports to the rest of Shikoku showing a good trend.

It is understood that last year, Yiwu Yiwu customs export BRIC countries totaled $ 1.03 billion, the export cargo of 907,000 tons, an increase of 52.1% and 28.1% respectively. Forecast data in accordance with the well-known American investment firm Goldman Sachs, the BRIC countries in 2012 more than 7 percent annual economic growth rate, much higher than the 1% -2% of the developed economies.

U.S. and European debt crisis and the political situation in the Middle East instability, as well as a new pattern of commodity exports, the shift in the customs people suggested to adjust the Yiwu small commodities export strategy, the BRIC countries as an important fulcrum of the commodity export, accelerate emerging markets layout, actively build a diversified export market structure, to reduce excessive dependence on the markets of developed countries and the traditional commodity exports, in the Middle East region.