Construction Practices in China

Construction Practices in mainland chinaConstruction practices in chinaw areAbstractChinese economy has experienced rapid yield since the word meaning of the open inlet policy in the past over 20 years. Real nation and verbalism, which act as a core diligence in mainland china, developed quickly as well. Quality headmaster serve in the area of certain estate development and plait is nonpareil of four main industries in Hong Kong which is internationally ren accepted. Since the Central brass of mainland chinaware has continually introduced policies comparable the signing of CEPA to stimulate stinting growth, the real estate securities industry will booming in the coming decades. The Hong Kong professionals in the theme of real estate and mental synthesis sedulousness should take these opportunities to explore mainland china market to give full play to their advantage of the top executive to concur economic and financial principles with project counselling and verbal expression technology.The objective of this discoverup is to estimate the market opportunities for Hong Kong professionals in the areas of real estate, phaseing and formulation hearing in Mainland china. This paper will analysis the market environment using SWOT method and give round suggestions to the clients while they are fashioning strategic circumspection plan.Introduction china, the worlds second largest economy, enlarge their demands for professional consultancy service in the field of real estate and construction market which including real estate, surveying, planning, project finance, development, building and construction after access World trading Organization (WTO).In the meantime, the competition patterns of Chinas construction effort consecrate been officially changed since China became a member of WTO. These changes comprise three perspectives. The first star is the growing foreign competitions in the Chinese construction industry. Secondly is the change magnitude segmenticipants of native construction firms in the worldwide construction market. The third wiz is changes of construction market environment by envisaging Chinas WTO commitments. The implementation of the WTO frame manoeuver raised(a) the level of legal enforcement in the construction industry which means a quick response to the changes is essential for Chinese contractors in developing their combative advantage. This increase the numbers of professionals and consultants who are intend to expend their commercial enterprise in mainland China with their whimsical insight and professional advantages. Hong Kong professionals and consultants are familiar with horse opera rights as well as both eastern and western culture, they slew take their advantages in this particular chance. Moreover, Hong Kong real estate and construction industry is a developed and competitive field, explore mainland market potful venthole some competitive pressure during proces s of talent output . food market environment in Mainland ChinaThe demand on the construction industry is closely related to the national fixed capital construction investment funds scale, which has been increasing rapidly along with the country s economic growth. The growth can be seen in the chart below and we can purpose that the fixed as aim investment will increase continually in the coming years as china still define construction as a column industry.Although China accepts open-door policy and some economic innovation to develop the country, mainland China market still hold its unique characteristic as uses Centrally controlled system. The hierarchy in China is alike complicated that the Joint Ventures have difficulties in developing trading in China (Walker, 1991).Chinas Background InformationNature of workQualification man resourcesManagement skillsTechnical / Financing abilityOrganisation structure neighborly influence (CSR)China-related factorsQualification in ChinaBusi ness coverage unexclusive notificationThere are many types of Joint Ventures in China Mainland, namely, equity joint ventures, co-operative ventures, compensation trade and wholly foreign owned ventures. China uses this way to develop for many reasons1) The investors bring the professionals and advanced equipments which lend to rapid development2) China can save a portion of money of the construction development3) The modern construction methods have been brought into ChinaTo sum up, China welcomes international and competitive investors like the developers of Hong Kong to have commercial enterprise in China Mainland and if the confederacy does not know too often about China or it has no qualification of construction work in China, it should co-operate with local regimen or local companies and this is main part of the paper.Identification of profession objectiveAs a Hong Kong developer needs to stupefy business in mainland China, first of all, the objectives must(prenominal ) be confirmed in the initial orderObjectives1) Qualification of construction in China MainlandSince the company does not have any qualifications of construction work in China, it must co-operated with the government or some local firms, the best strategy is to have long term partnership with one company which possesses relevant qualifications, so when there is a new construction project, less time is required for supportting governments approvals.2) Expend the reputation in mainland China3) Business extensionThe company is still in the developing stage and intends to occupies part of the market in main cities of China.SWOT evaluatement for the business developmentSW (Strengths and Weaknesses)Good project management skills Hong Kong developers are equipped with mature project management internet system. Project workshop like project process management, risk management are increase their management ability in a large extent.Better info management facility Hong Kong has new in formation and technology and these become the advantages when developing business in China Mainland, e.g., the cyclical and sustainable system are astray applied to different fields of construction work in Hong Kong (Lam, et al., 2010). Moreover, the communion systems including project management system and business administration system make sure the process and linkup between different parties proceed effectively and smoothly. The use of building information frameworking (BIM) also improve military capability of construction practices.Advanced machinery and equipment tHigher labour productiveness In general, labour productivity growth increases the capacity of the economy as to a greater extent outputs could be generated from any given amount of labour inputs, thereby enabling the economy to expand at a faster pace. In the consequence of Hong Kong, a city with limited natural resources as well as modest population growth, the continued farmment in labour productivity is particularly vital for rendering growth impetus to support a sustainable and healthy economic development. Moreover, Hong Kong labour own a unassailable reputation in high productivity as they are cutting on improving their alive standards continually.Good finance-raising ability Compared with local developers, Hong Kong developers own more comprehensive finance raising method which including RIETS, foreign contribute and bonds, securities or even raise the money from their parent companies. Base on the statistic annual book of China, for the native developers, there are over 80 percents of funds for property development only comes from direct and indirect savings bank loans. This factors also illustrate that Hong Kong developers are easier to diversified their invest risk with combining different sources of investment amount.Good monetary value control ability the utilize of modern information facilities ensure Hong Kong developers control project cost better than local com panies. The cost control system generate a higher profit and monitor the construction cost during project support cycle.Attraction to considerably human resources Hong Kong government pays great attention to the look of the construction worker and managers, take the Construction Industry Training power (CITA) which was established in September 1975 with an amendment in 1991 (Rowlinson and Walker, 1995) as a example, CITA offers trainings and helps to the ones who are in the construction field or will enter in the near future and it level up the quality of the staff, furthermore, numerous professional from western world come to Hong Kong which is also contributes to the high quality construction institution and build.Higher production be Increasing production costs on the Chinese mainland will eating into thin profit margins for Hong Kong developers definitely. demographic dividend in China is reduce day by day and developers are facing manpower shortage as well.Limited channe ls for market information Although the internet smaller the world and it seems that all the information can be make from it, actually, in China Mainland some real information of the market will be to some degree blocked by the government, so some depression parts cannot be clearly found and there would be more risks when having construction projects in China.Lower businesses qualification, zipper can be done if the developer of Hong Kong has no qualifications of having construction work in China Mainland, such as safety qualification, construction qualification and some land acquisition problems. Ein truth place has its own guideline of design and build, and the developer who wants to have business in China should learn relevant law and regulation, if something is done over Chinas law and regulation, the project cannot get the stamp from the authority department even though the project is in the final stage.Limited businesses relationship One of the most important things of hav ing business in China is the relationship with Chinas government, it is very parkland for Chinas government to assign projects to the companies they have good relationship with, even in the tendering, both reputation of a company and the relation with government are important, in short, without governments help, the project cannot be approved in the initial step.Leung, Chan and Chong (2010) also mentioned that relations meant a hoi polloi in China, people in the construction industry should have good relations with friends in the society, especially the ones within construction organizations. Zhang (2011) also illustrated that in China, prior to the commencement of construction work, the company must apply to the be after Bureau and obtain a Construction Planning Permit, so to build up good relations with the local Planning Bureau is very important.OT (Opportunities and Threats)Improved policy environment for foreign business The policies published by China government stated that they would continue to improve economy environment to attract foreign businesses such as the accession to the WTO and signing of CEPA.Government promotion of construction The twelfth Five-Year Plan which begins in the year 2011 set the mission that the whole social fixed assets investment on construction industry must grow more than 15% every year. This is a strong evidence that Chinese government want to cement the pillar industry status of construction industry which also strengthen combine of Hong Kong developers to explore their business in mainland China.establishment of book of facts entry system China will promote the establishment of a nationwide social credit system comprehensively in the next five years, or the 12th Five-Year Plan period (2011-2015). The Chinas State Council stated that the country will deepen legislation and regulation improvement concerning the credit system and push onwards the construction of credit systems within industries and government depa rtments, and at local levels. The government will also give their mind to make sure the credit system be shared in the nationwide, develop credit pass judgment agencies and promote use of credit products in an orderly way. Meanwhile, the government should enhance its own credibility by increasing transparency, and strengthen education on social honesty.development of understanding of international practicecertain restrictions on foreign investment China uses law to restrict the foreign investors in China, e.g. China welcomes the investors who hold advanced technology and can improve the living environment of China, can provide international level products, etc., so Chinas government would spend a lot of time to assess whether the investor is suitable or not.increasing intense competition The open door policy creates opportunities for many foreign companies to enter Chinas coarse market which increase the competition among companies.the risk of breaching contracts.Reassessment of the feasibility subsequently the SWOT analysis, it is necessary to reassess based on the advantages and the disadvantages.ReferencesGanesan, S., Hall, G. and Chiang, Y. H. (1996). Construction in Hong Kong. England.Lam, P. T. 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