Good afternoon, ladies, and gentlemen:

It is really a great honor for us to have such opportunity to share our opinions on the topic of China Oil / Gas Equipment Industry with all of you here.

China is the new economic giant with a voracious appetite for oil, cars, Ipods, and Big Macs. In 2001 China acceded to the World Trade Organization. As a result of its efforts in the global marketplace, by 2007 China had become the world's third largest trading power behind the United States and Germany. Until end August 2008, investors from 192 countries and regions have established more than 650,000 foreign invested enterprises in almost all industries. Of the 500 top transnational companies in the world, 450 have invested in China, and foreign investments have become an important capital source for China's economic development.

As with other economic categories, China is a major producer and consumer of energy resources. According to statistics released by the China Petroleum and Chemical Industry Association (CPCIA), China's apparent consumption of oil products composed of gasoline, diesel and kerosene increased by 16.5 percent year on year to 52.73 million tones in the first three months of 2008, and crude oil, increased by 8 percent to 91.8 million tones. In 2006, China produced 185 million tons of crude oil, and 585,500 million cubic meters of natural gas. China, nevertheless, is a net importer of petroleum because the required high grades of petroleum are not available domestically. Imports of crude oil totaled 163.18 million tons in 2007. Even the demand of petroleum increases very quickly, increase of crude oil manufacture has slowed down to 1.62% in 2007. There exist many opportunities for foreign oil / gas equipment and service companies to provide advanced technologies to develop the production process, enhance oil and gas recovery, exploit new sources, and enable high quality.

In following I'd like to introduce some investment requirements for engaging in China Oil / Gas Equipment Industry, which includes Certificates required for imported equipments, Investment type, and the most being concerned problems for foreign equipment enterprises - the sales channel. I would try to describe this key point according to our experiences. After setting up in China, there are still many questions about Chinese Tax issues: withholding tax, business tax, value-added tax, and personal income tax. In this lecture I am going to picture a clear scheme upon them. Nevertheless, it is very important for newcomers to get to know the general information about foreign investment in China. From company formation, tax reform to specific aspects referred to Chinese culture and business conventions, every point would help you to ensure a successful operation in China.

I do hope this lecture could in some way be helpful for your business in China. And we look forward to any cooperation with you all in the future. Wish you all the success and enjoy your stay in China!

Cindy Zheng
General Manager
Sino-Link Consulting
November 12, 2008


You can find the further detail about the speech under http://sinolinkconsulting.com/down/html/?4.html