Brewing a startup – part 1

Magic Logo

In a 10-part series, the Malaysian Global Innovation and Creativity Centre (MaGIC), in collaboration with The Star’s Metrobiz section, explores what it takes to make a great startup ecosystem, beginning with an understanding of what startups are all about.

The Father of Modern Chemistry, Antoine-Laurent de Lavoisier once said that it is vital “to submit our reasoning to the test of experiment, and never to search for truth but by the natural road of experiment and observation.”

A startup’s journey is not very different, in that it is meant to run a series of experiments before it hits a growth path. According to Steve Blank, a Silicon Valley serial-entrepreneur who developed the Customer Development Methodology, “A startup is an organisation formed to search for a repeatable and scalable business model.”

But what is a business model?

A business model describes how your company creates, delivers and captures value. An entrepreneur is supposed to create a vision for a product that solves a real problem in the world, with a series of assumptions about all the pieces. Who are the customers? How do you sell to them? How do you price and position the product? How do you build and finance the company?

An entrepreneur’s job is to quickly validate whether the model is correct by seeing if customers behave as predicted. Most of the time they don’t. So entrepreneurs are supposed to tweak that business model until they find enough traction to grow into a sustainable company.

Once on a growth trajectory, a startup decides to enter new markets or create new product lines and eventually exits favourably, providing significant returns to investors or venture capitalists.

Like science experiments, a startup is meant to fail several times before it succeeds. It is important that we understand this in order to support local entrepreneurs who are looking to push the boundaries of innovation.

Jack Ma’s e-commerce company Alibaba Group Holding Ltd’s recent US$25bil (RM80.7bil) initial public offering on the New York Stock Exchange, which is the largest in history, proves that Asian entrepreneurs and markets are just as competitive and innovative as those in the US.World largest IPO: Alibaba shows

Another revered Silicon Valley figure, Y Combinator startup incubator founder Paul Graham describes a startup as, “a company designed to grow fast.” He goes on to explain that a startup does not have to be newly founded to work on sophisticated technology or to take venture funding. He emphasised that the only essential thing for a startup to achieve is high growth.

Without high growth, a company is categorised as the more common small- and medium-sized enterprises of mom-and-pop shops, professional services firms, manufacturers, brick-and-mortar businesses, or resellers. They typically grow at a steadier rate, require physical locations, more up-front capital (usually bank loans as opposed to private investments) and are not as scalable (can only serve a limited number of people based on human resource capacity).

The new startups of the 21st century are also admittedly different from the old-school startups of the 1970s, back in the early Microsoft, Oracle and Apple days. Today’s startups are a new breed that leverages the Internet and technology to scale across borders very quickly.

Startups such as Facebook, Airbnb, Dropbox, Pinterest, Uber and Spotify have all achieved billion-dollar valuations in a matter of three to four years.

This signifies that we are in a new era where entrepreneurs are able to very quickly create global products that permeate our daily lives. And these entrepreneurs can come from anywhere, not just Silicon Valley, which is typically the benchmark for startup and innovation ecosystems around the world.

Startups are the main job creators in the US economy, and similarly, it will become the primary growth engine for Malaysia as we seek to become a high-income nation by 2020.

As a nation that is trying to push its own innovation boundaries, we should come together and support our young entrepreneurs and enable them to solve some of the toughest problems in our country and beyond.

Next week: Some of our local startups who have made it big.


Related posts:

sign MoUs with Stanford U. and UP Global CYBERJAYA: Prime Minister
Datuk Seri Najib Tun Razak tonight witnessed the signing of memorandum
of understandings between the Malaysian Global Innovation and .
LUMPUR: Prime Minister Datuk Seri Najib Razak has announced the
establishment of the Malaysian Global Innovation and Creative Centre or
MaGIC in Cyberjaya to encourage entrepreneurship among Malaysians.

Malaysian Internet users, technology trends, evolution and change in telco industry

MAXIS: Data takes dominance

Maxis' CEO Morten Lundal
Net effect: According to Lundal, productivity for the future depends on the degree of Internet adoption.

When I came to Malaysia last year, I was assuming that I was going back into an emerging market which is a transition from the place I worked (London).”

“But my perception now is that this is actually a very advanced market,” says Morten Lundal, chief executive officer at Maxis Bhd, whose tenure at the company just crossed the one-year mark as of Oct 1.

Among the reasons that he feels differently about the nation’s technological progress is because of the high smartphone and broadband penetration rate.

“Malaysians’ adoption and smartness when it comes to using (mobile) applications is fully comparable with Europe,” he says.

People on our network use about 1GB per month. Some devices use more. Android more than iOS devices, I’ve noticed. We have people on Android using about 1.3GB or so per month. Both on prepaid and postpaid, people are using a lot of data in Malaysia.”

However, he points out that the local e-commerce market has yet to fully develop.

“Companies here are still fairly traditional in the way they operate. People have much more (technologically) advanced experiences personally,” Lundal says.

“This is going to change in the next five years, but it hasn’t come about yet… The corporate sector is lagging behind more mature markets in Europe.”

However, on the whole, he regards Malaysians as being “very savvy.”

In addition to common online activities such as the use of search engines, social networking sites and real-time GPS services like Waze, Lundal has noticed several distinct trends amongst Maxis’ various user segments.

For instance, he says youth between the ages of 18 and 25 years tended to favour mobile games and streaming video services such as YouTube. He also found Asian youth to be more attracted to image based social media sites such as Instagram as compared to their European counterparts.

“The Chinese are driving more online shopping than other segments and that’s quite interesting,” he says, adding that the Malay segment is active on online forums, games, social networking and instant messaging whereas the Indian segment is more focused on sports, news, instant messaging and social media.

As for the older generation, Lundal says they tended to be more “news savvy” and spent a lot of time online surfing news portals.

“They also use much more hobby and personal interest sites which are less important to the youth. So they are the more functional users of the Internet whilst the youth are the social users.”

Meanwhile, the migrant workers segment had an obvious preference for international news, particularly from their respective home countries. They also liked online comics more than most Malaysians.

Internet breeds change

One of the good things that Lundal sees out of the growing mobile networks across Malaysia is that it enables the general population to gain better access to the Internet.

Besides that, he says that “innovation for IP (Internet Protocol) communications is tremendous”.

However, he sees the ongoing buzzword of the Internet of Things (IoT) as a mere cliche.

“I first heard about IoT in 1998, I think. It’s like a very old expression and the enablers have been in place for years, but it really hasn’t happened yet. I think it is going to happen now, but in a five year perspective,” he says.

As the Internet continues to impact the way society operates, Lundal envisions a shift in the way things are done in the corporate and public sector.

“Productivity for the future more or less equals to what degree you’ve adopted the Internet,” he points out.

“As the younger workforce demand a more advanced technological infrastructure where they work, I think this will drive a big change in how enterprises and the government operates.”

Another disruptive trend that Lundal has noticed is the way users are moving away from preprogrammed content and websites.

“It’s fascinating to see how people are choosing very segmented niche content and making that their default,” he says.

In particular, he points out that youth, especially in countries like the United States, are preferring to consume news via late night comedies and social networks instead of through traditional channels.

“This unpackaging and unbundling of these channels will cause a massive societal impact and change.”

Courting change: As disruptive technologies and trends take hold, telcos including Maxis are faced with the challenge of evolving its business to meet the growing needs of its subscribers.

Telco evolution

As these trends continue to take shape, telcos across the globe, including Maxis, are faced with the challenge of evolving its business to meet the growing needs of its subscribers.

“As an industry, we as mobile operators were used to connecting people to our services. Now we connect people to the Internet,” says Lundal.

“We’ve gone from a decade of selling enablers like phones and connections to now really leveraging those enablers to change lives and companies.”

One of the major changes being faced by the industry at the moment is the dwindling emphasis on SMS and traditional voice calls.

“As an industry, we haven’t innovated on SMS… It’s the same product as it was when it was launched which is unacceptable, I would say, from a consumer’s perspective,” Lundal says.

“SMS is declining a lot globally and will be gradually replaced by IP communication. But for now it’s still widely used because when people want to be sure that the communication is getting through, they use SMS.”

In contrast, he says voice calls are also declining in importance, but at a much slower pace than was expected.

Lundal expects to see SMS fading in importance within the next three to five years whereas for voice communications, he feels it would only decline over a span of four to eight years.

In response to that, he says revenue models for mobile operators are changing globally to become more data centric.

“About 99% of our costs are driven by data,” Lundal says. “It’s a very dangerous situation indeed to have your revenues coming from voice (calls) while your costs are driven by data which is why there is a shift all over the world. That’s a bit slower in Malaysia as players are getting weaned off their old habits.”

However, he adds that he does not view this change in product emphasis as a threat, but rather “a transition that we all have to go through.”

Road to improvement

Over at Maxis, Lundal shares that the company is keeping pace with these changes in technology in three ways.

Firstly, it aims to project itself as an Internet showcase within the Malaysian economy.

“We would like to be in the forefront on how we adopt the Internet ourselves,” he explains. “We also want to change how Malaysian companies operate and help them in their process of being digitised.”

His vision for the future is that Maxis ought to be viewed as a mobile app.

“I like to take extreme positions in order to make people think differently,” he says. “I said to management that we should close our website in three years’ time. Not entirely close it, but probably it will morph into something else. The key interactions with our company should be through an app.”

Besides that, Lundal shares that Maxis is working on ensuring it offers an “unmatched customer experience” to its subscribers, calling it the company’s “flagship programme.”

“We have just built a new network for 70% of our customers this year. The rest will have that experience by next year. This is so that when it comes to the speed of data networks and dropped call rates, we will be world class,” he says.

He is quick to point out, however, that “top class doesn’t mean it’s perfect.”

But according to him, the number of complaints directed to Maxis in the past year has decreased by as much as 50%. As for dropped calls, he says it is currently at the rate of one in 300 calls.

“There are two reasons for that: our network is dramatically improving even though it’s not perfect and we have also taken some pretty drastic, proactive measures to make life better for customers by taking away any pay-per-use charges (for data usage).”

He is referring to the MaxisOne postpaid plan here, whereby subscribers of this Internet plan are not charged for their phone calls and SMSes.

As for the prepaid side, the company also offers a free basic Internet connection of 64Kbps (kilobits per second) for its Hotlink product which Lundal claims is fulfilling a need that most users face.

“Most Malaysians prepaid customers are connected to high speed data (networks) only six to eight days per month and they’re buying daily passes. For the rest of the time, they’re unconnected and they’re trying to find a WiFi connection,” he says.

Last of all, Lundal shares that Maxis is transforming the way it operates internally as well.

“We’re going to rid ourselves of this habit of using paper processes and use more Cloud and mobile instead,” he says.

He says Maxis plans to implement a new human resource system that is Cloud based and accessible via mobile. It has also launched a new intranet and social networking platform for its employees.

On the whole, Lundal says Maxis is setting new benchmarks for itself to achieve.

“We don’t compare ourselves anymore (to competition) nationally, we compare ourselves internationally,” he says.

Contributed by Susanna Khoo The Star/Asia News Network

LED lighting technology inventors win Nobel Prize

LED Light-Emitting Diode: red, green, blue, white led lights are available

STOCKHOLM—Isamu Akasaki and Hiroshi Amano of Japan and U.S. scientist Shuji Nakamura won the Nobel Prize in physics on Tuesday for the invention of blue light-emitting diodes, a breakthrough that spurred the development of LED technology used to light up computer screens and modern smartphones.

The Royal Swedish Academy of Sciences says their invention is just 20 years old, “but it has already contributed to create white light in an entirely new manner to the benefit of us all.”

Scientists had struggled for decades to produce the blue diodes that are a crucial component in producing white light from LEDs when the three laureates made their breakthroughs in the early 1990s.

Their work transformed lighting technology, paving the way for LED lights that are more long-lasting and energy-efficient than older sources of light.

“They succeeded where everyone else had failed,” the Nobel committee said. “Incandescent light bulbs lit the 20th century; the 21st century will be lit by LED lamps.”

Akasaki, 85, is a professor at Meijo University and distinguished professor at Nagoya University. Amano, 54, is also a professor at Nagoya University, while the 60-year-old Nakamura is a Japanese-born professor at the University of California, Santa Barbara.

Akasaki said in a nationally-televised news conference that he had often been told that his research wouldn’t bear fruit within the 20th century.

“But I never felt that way,” he said. “I was just doing what I wanted to do.”

Akasaki and Amano made their inventions while working at Nagoya University while Nakamura was working separately at Japanese company Nichia Chemicals. They built their own equipment and carried out thousands of experiments — many of which failed — before they made their breakthroughs.

In a statement from his university, Nakamura said he was honoured to receive the prize.

“It is very satisfying to see that my dream of LED lighting has become a reality,” he said. “I hope that energy-efficient LED light bulbs will help reduce energy use and lower the cost of lighting worldwide.”

The Nobel committee said LEDs contribute to saving the Earth’s resources because about one-fourth of world electricity consumption is used for lighting purposes.

They are more efficient than older light sources, and tend to last 10 times longer than fluorescent lamps and 100 times longer than incandescent light bulbs.

“The blue LED is a fundamental invention that that is rapidly changing the way we bring light to every corner of the home, the street and the workplace — a practical invention that comes from a fundamental understanding of physics in the solid state,” said H. Frederick Dylla, the executive director and CEO of the American Institute of Physics.

Phillip Schewe, a physicist at the Joint Quantum Institute at the University of Maryland, said the prize shows that physics research can provide a practical benefit, rather than just probing the mysteries of the universe.

On Monday, U.S.-British scientist John O’Keefe split the Nobel Prize in medicine with Norwegian couple May-Britt Moser and Edvard Moser for breakthroughs in brain cell research that could pave the way for a better understanding of diseases like Alzheimer’s.

The Nobel award in chemistry will be announced Wednesday, followed by the literature award on Thursday, the Nobel Peace Prize on Friday and the economics prize on Monday.

Worth 8 million kronor ($1.1 million) each, the Nobel Prizes are always handed out on Dec. 10, the anniversary of prize founder Alfred Nobel’s death in 1896. Besides the prize money, each laureate receives a diploma and a gold medal.

Nobel, a wealthy Swedish industrialist who invented dynamite, provided few directions for how to select winners, except that the prize committees should reward those who “have conferred the greatest benefit to mankind.”

- Associated Press reporter Yuri Kageyama in Tokyo, and Malcolm Ritter in New York, contributed to this report.

Blue LED inventors win Nobel Prize for “energy-efficient, environmentally-friendly light source”

Blue LEDs

CC BY-SA 3.0 Wikimedia

 Incandescent light bulbs have lit the 20th century….

Years ago we said that LEDs are without a doubt the future. But time marches on, and LEDs are not just the future anymore, they’re the present thanks to rapidly falling prices and improving quality. We’ve firmly entered into the LED era, as Lloyd showed with his experience of converting 100% of his lights to LEDs.

The Nobel committee seems to agree. The physics Nobel Prize this year is going to three distinguished scientists – Isamu Akasaki, Hiroshi Amano, and Shuji Nakamura – who invented the blue LED, the last piece of the puzzle that was required for LEDs to truly reach their potential as a mass-market light source.

Why was blue so important? Because without it, we couldn’t make high-quality white light from LEDs.

“Red and green LEDs have been around for a long time but blue was really missing. Thanks to the blue LED we now can get white light sources which have very high energy efficiency and very long lifetime,” Per Delsing, a member of the Royal Swedish Academy of Sciences, told a news conference.


Nobel Prize/Screen capture

…the 21st century will be lit by LED lamps

As you can see on the graphic below, LEDs crush the competition when it comes to efficiency. Most LED lights that you can buy right now are nowhere near the 300 lumens/watt shown here, but this is what we know they are capable of, and over the coming years we should progressively move closer to that target.

About 20% of the world’s electricity is used for lighting. With optimal use of LEDs, that figure could fall to 4%. That’s a really big deal. This represents the equivalent of hundreds of large power plants that would no longer be necessary, and by reducing electricity consumption, it will be easier to switch to clean sources of energy like solar and wind.

Nobel Prize/Screen capture

But energy-efficiency isn’t the only thing. Material efficiency is also much higher for LEDs than the competition. A LED can last up to 100,000 hours, compared to 1,000 for incandescent bulbs and 10,000 hours for fluorescent lights. This means that only a fraction of the bulbs need to be produced and disposed of over time. In applications like traffic and street lights, it also reduces the need to have crews driving around, burning fuel, just to replace burned out lights.

© Michael Graham Richard

LEDs are not only way more efficient than incandescent technology, which is sadly still by far the most popular out there, but because they emit light more directionally, they can also be better cutomized to various applications. For example, these LED floodlights cost 50% less than the version they replace and cut energy use by 70%.

© Philips

Some cities, like Buenos Aires, have started replacing street lights with LED. Buenos Aires is switching around 100,000 street lamps to LED technology, cutting energy use by 50%. The quality of light is also improved, so that people can better see when they’re out at night.

BY Michael Graham Richard Technology /Clean Technology

Inventors of blue LEDs win 2014 Nobel Prize for physics

The 2014 Nobel Prize for physics is being awarded to three scientists credited with inventing efficient blue LEDs, a development that allowed for the creation of the white LED light sources that are inching toward ubiquity across the globe. Though LEDs of other colors have been around since the mid 1900s, the blue LED proved far more difficult to create as researchers struggled to find a material that would produce blue light. The three researchers being awarded today, Isamu Akasaki, Hiroshi Amano, and Shuji Nakamura, recognized that gallium nitride would lead to a blue color and discovered a way to produce the light in an efficient way by adding in aluminum and indium.

Red, green, and blue light needs to be combined to create white light, so the work of Akasaki, Amano, and Nakamura provided the final piece to a long-running puzzle. Since then, white LED lights have increased in efficiency and are slowly becoming more prevalent. “The LED lamp holds great promise for increasing the quality of life for over 1.5 billion people around the world who lack access to electricity grids,” The Royal Swedish Academy of Sciences explains, “due to low power requirements it can be powered by cheap local solar power.” The winners will split a prize of 8 million Swedish Krona, or about $1.1 million USD.

“Incandescent light bulbs lit the 20th century,” the Academy writes, “the 21st century will be lit by LED lamps.”

By Jacob Kastrenakes The Verge

Building the 21st Century Maritime Silk Road

Reflections on Maritime Partnership

China Maritine Silk Road_ Asean

The “Silk Road” is a general term used to geographically describe ancient Chinese exchanges between Asia, Europe and Africa in the areas of politics, economics and culture. Starting on land and developing on sea, the “Silk Road” is a vehicle of historic importance for the dissemination of culture. The ancient maritime Silk Road was developed under political and economic backgrounds and was the result of cooperative efforts from ancestors of both the East and West. China’s proposal to build a 21st Century Maritime Silk Road is aimed at exploring the unique values and concepts of the ancient road, enriching it with new meaning for the present era and actively developing economic partnerships with countries situated along the route. Specifically, the proposal seeks to further integrate current cooperation in order to achieve positive effects.

The ocean is the foundation and vehicle necessary to build a 21st Century Maritime Silk Road. It is China’s mission to understand the importance of building a Maritime Silk Road and take effective actions at present and for a certain period to come.

21st Century Maritime Silk Road from a Global Perspective

In the twenty-first century, countries have become more inter-connected by the ocean in conducting market, technological and information exchanges. The world is now in an era that values maritime cooperation and development. China’s proposal to build a Maritime Silk Road conforms with larger developments in economic globalization and taps into common interests that China shares with countries along the route. The goal is to forge a community of interest with political mutual trust, integrated economies, inclusive culture and inter-connectivity. The construction of a 21st Century Maritime Silk Road is a global ini-tiative that pursues win-win results through cross-border cooperation. It is thus of great importance to view it from the perspective of multi-polarization, economic globalization and the co-existence and ba-lancing of cooperation and competition.

Building a 21st Century Maritime Silk Road will help stimulate all-round maritime opening-up and benefit ASEAN and relevant countries.

Oceans contain a treasure trove of resources for sustainable development. China is currently at a critical stage in its economic reform process and must pay more attention to the ocean. As mentioned in the resolution of the Third Plenum, “[China] needs to enhance opening-up in coastal regions and boost the connectivity construction with neighboring countries and regions to spur all-round opening-up.”

The Maritime Silk Road of the 21st century will further unite and expand common interests between China and other countries situated along the route, activate potential growth and achieve mutual benefits in wider areas. The Maritime Silk Road will extend southward from China’s ports, through the South China Sea, the Straits of Malacca, Lombok and Sunda and then along the north Indian Ocean to the Persian Gulf, Red Sea and Gulf of Aden. In other words, the Road will extend from Asia to the Middle East, East Africa and Europe, and it will mainly rely on ASEAN countries. Building the Maritime Silk Road will connect China’s ports with other countries through maritime connectivity, intercity cooperation and economic cooperation. On the one hand, the Road will strengthen the economic basis for China to cooperate with countries along the route and better connect Europe and Asia. On the other hand, the Road will facilitate the development of the Regional Comprehensive Economic Partnership (RCEP), bringing benefits to China, ASEAN and other countries along the road.

The Maritime Silk Road will increase trust and regional peace and stability.

As the world’s economic and political center shifts towards the Asia Pacific, the region has stepped into a stage of geopolitics characterized by intersecting, overlapping and conflicting interests. By facilitating communication between countries along the road, the Maritime Silk Road will help build a community that represents the common concerns, interests and expectations of all countries. The community is expected to guide and support a peaceful and stable Asia Pacific landscape.

Moreover, the Maritime Silk Road will further bring together the “Silk Road Economic Belt,” the “Bangladesh-China-India-Myanmar Economic Corridor” and the “China-Pakistan Economic Corridor” that together connect Europe and Asia. Such connections will greatly enhance China and other countries’ abilities to develop economically while limiting external risks. The Maritime Silk Road will also enhance cooperation in non-traditional security areas while maintaining maritime security.

Maritime Partnerships Are the Key to Building the Maritime Silk Road

At a speech before the Indonesian parliament in 2013, President Xi Jinping stated that Southeast Asia has become an important hub for the maritime silk road and that China is willing to enhance maritime cooperation with ASEAN countries, boost maritime partnerships and build a 21st Century Maritime Silk Road. President Xi’s speech set forth a clear path for developing road. Enhancing maritime cooperation will be a priority task in building the Maritime Silk Road. The first step will involve China and countries along the route promoting pragmatic maritime cooperation.

Connecting multiple regions and uniting wide areas of co-operation, the tasks put forth in the 21st Century Maritime Silk Road will not be achieved in the immediate future. Instead, these tasks call for China and relevant countries to work in a step-by-step and practical manner. Building the Maritime Silk road will require diverse forms of cooperation. With a focus on economic cooperation, the Road will give consideration to all parties involved. It will be based on the existing cooperation mechanisms and platforms and be promoted by China and other countries along the route.

The 21st Century Maritime Silk Road will cover more than 20 countries and regions that share a broad consensus on enhancing exchanges, friendship, promoting development, safety and stability within the region and beyond. The Silk Road has already received positive responses and support from many relevant countries. Greek Prime Minister Antonidis Samaras, for example, made it clear that Greece will “support and actively participate in building the 21st Century Maritime Silk Road proposed by China.” The Road runs through a region that is sensitive to international strategy and has complex geopolitics. The countries in the region differ in size, development, history, religion, language and culture. Therefore, the 21st Century Maritime Silk Road will accommodate various countries’ demands and apply suitable policies to each country. Meanwhile, the Road must change and consolidate new patterns of cooperation.

China has been building friendships and partnerships with nei-ghboring countries and developing maritime partnerships with its ocean neighbors, providing a solid foundation for cooperation with ASEAN and countries in the region. The 21st Century Maritime Silk Road requires the following efforts: First, consensus must be reached between major countries along the route to enhance maritime cooperation. During high-level dialogues in recent years, the Chinese leadership made maritime cooperation an important topic of bilateral discussions and established the China-ASEAN and China-Indonesia Maritime Cooperation Fund. At the same time, China has actively promoted maritime cooperation between Southeast Asia, South Asia and African countries and established high-level mechanisms between various national maritime departments.

Second, countries must engage in pragmatic cooperation along the route in the areas of trade, the economy, culture and infrastructure. In 2012, the trade volume of countries along the route accounted for 17.9 percent of China’s total trade. The contracted turnover in countries along the route accounted for 37.9 percent of China’s overseas contracted turnover. People-to-people exchanges between China and ASEAN recently topped 15 million, while two-way students reached more than 170,000.

Third, countries along the route must engage in effective cooperation on ocean and climate change, marine disaster prevention and mitigation, biodiversity preservation and other areas of maritime policy. In 2010, the Indonesia-China Center for Ocean & Climate (ICCOC) was established. In 2013, the China-Thailand Climate and Marine Ecosystem Joint Lab were both launched. In 2012, the Chinese government set up a Marine Scholarship, and from that year onward, the scholarship will sponsor young people from developing countries in Southeast Asia, Africa and Latin America to obtain a master’s degree or doctorate in China to enhance the marine capabilities of their own countries.

Focusing on Developing Partnerships Along the Maritime Silk Road

The Maritime Silk Road is in line with the development of national economies and the improvement of welfare. China must follow the new perspectives on value, cooperation and development featuring equality, cooperation, mutual benefits, win-win results, inclusiveness and harmony. Guided by President Xi’s desire to “expand the scale of cooperation and gradually foster regional cooperation,” China must make use of its comparative advantages and promote communication, connectivity, trade flow, currency circulation and consensus among people. China needs to target common interests between countries along the road and map out long-term plans and execute its plans in a step by step manner.

The Road will connect the Pacific and Indian Oceans. China will focus on upgrading the China-ASEAN Free Trade Area and extending it to the coastal regions of the Indian Ocean, the Persian Gulf, the Red Sea and the Gulf of Aden. By virtue of connecting the China-Pakistan Economic Corridor, the “Bangladesh-China-India-Myanmar Economic Corridor” and the “Silk Road Economic Belt,” China will build an open, safe and effective maritime road that can facilitate trade, transportation, economic development and the dissemination of culture.

The Road will also make good use of the China-ASEAN Maritime Cooperation Fund and enhance pragmatic maritime cooperation. By prioritizing cooperation in inter-connectivity, the maritime economy, marine environmental protection and disaster prevention and mitigation, China aims to improve the welfare of countries along the route and share the benefits of the Maritime Silk Road.

The Road will also make use of existing bilateral and multilateral marine cooperation mechanisms and frameworks. By making use of the existing and effective marine cooperation platforms, China will improve the area’s marine partnership network, forge closer ties between countries along the route and finally create a cooperation landscape in which marine resources, industries and culture are all reasonably distributed and mutually reinforcing.

The construction of a 21st Century Maritime Silk Road the development of marine partnerships call for the following measures:

First, it will call for better marine connectivity. Infrastructure connectivity is the priority of the 21st Century Maritime Silk Road. Countries need to focus on building key pathways, points and major projects, and China needs to work with countries along the road to build marine infrastructure, improve law enforcement abilities, provide public goods of marine security and guarantee the security of marine pathways. China needs to support the construction of ports, wharves and information networks to ensure the open flow of goods and information. It must also enhance communication on marine cooperation policies to facilitate marine investment and trade.

Sea lane safety is the key to sustaining the development of the 21st Century Maritime Silk Road, while ports are the foundation of sea lane safety. Like posts along the ancient Silk Road, ports along the new Maritime Silk Road will act as “posts on sea” that handle cargo and resupply ships and people. Such “sea posts” also must provide safe and convenient sea lanes for all countries to make use of. These posts can either be built by individual countries or built with the help of China and other countries, or even be leased in other counties. The 21st Century Maritime Silk Road will thus able to cover and drive more countries to create “sea posts.”

Second, it will call for strong cooperation on marine economy and industry. Many countries along the route strategically exploit the ocean, develop their maritime economies and sustain marine development. Strengthening cooperation on marine economics and industry will help push forward modernization and promote the upgrading and optimization of industry. Such cooperation will better integrate China’s economy with those of countries along the route.

Closer cooperation in the marine industry will require domestic industrial restructuring according to market demands, require prioritized cooperation in marine fishery, tourism, desalination and marine renewable resources and require Chinese enterprises in this industry to go global. China encourages enterprises with intellectual property and sophisticated desalination technology, marine renewable resources and marine bio-pharmaceutical technology to invest and build their own businesses in countries along the route.

Relying on existing Economic and Trade Cooperation Zones between China and other countries, as well as marine demonstration zones in Tianjin, Shandong, Zhejiang, Fujian and Guangdong, the government will play a leading role in the initial stages, guide enterprises with mature technologies in iron and steel, shipbuilding, fishery and aq-uaculture to establish production bases and extend industrial chains to countries with rich resources and huge demand.

China needs to work with countries along the route to facilitate regional cooperation, building industrial parks, enhancing investment and cooperation in the marine industry, building marine economic demonstration zones, marine technology parks, economic and trade cooperation zones and marine training bases. Through such industrial cooperation, China will forge an investment cooperation platform in which Chinese enterprises can gain international competitiveness and participate at a higher level of the industrial echelon.

China needs to build a cooperation belt to enhance the marine industry and set up cooperation networks to facilitate marine tourism. A sustainable Maritime Silk Road will not be achieved without the help of port economic zones. As a result, China must develop its port economic zones and free trade zones to provide a platform for the Maritime Silk Road. China will focus on eliminating systematic and mechanistic barriers, lowering market thresholds and facilitating the opening-up of major areas.

Third, it will call for all-round cooperation in marine fields. In recent years, non-traditional security issues such as piracy, maritime terrorism, cross-border crimes and maritime disasters have loomed large. Countries along the route share a common interest in addressing these problems. Naturally, fighting against non-traditional security challenges will become an important part of the Maritime Silk Road. As such, China must promote exchanges and cooperation between countries along the route in the areas of marine technology, environmental protection, marine forecasting and rescue, disaster prevention and the mitigation and climate change.

Putting the “Marine Technology Partnership Plan” into practice. Based on existing marine cooperation centers and observation platforms, China will focus on promoting marine technology cooperation networks and building the China-ASEAN Marine Cooperation Center, the Indonesia and China Center for Ocean and Climate, the China-Thailand Climate and Marine Ecosystem Joint Lab, the China-Pakistan Joint Marine Center, the China-Sri Lanka Marine and Coastal Zone Joint Research Center and other ocean stations.

Building “marine ecological partnerships.” By paying more atten-tion to an ecological civilization, China needs to enhance cooperate with countries along the route to build a green Silk Road that addresses the marine ecological environment and climate change. China must set up an effective dialogue mechanism, map out major projects in which all parties can get involved and make comprehensive plans for regional ecological and environmental protection. China must work more closely with Southeast Asia and South Asia to protect biodiversity, build a cross-border bio-diversity corridor and establish marine conservation areas.

Conducting the regional marine research. By building cooperation networks for marine disaster preparedness, providing marine forecasting products and releasing marine disaster warnings, China will increase marine benefits for relevant countries.

Fourth, it will call for expanding cooperation in marine culture. Marine culture is the foundation of building a 21st Century Maritime Silk Road. When talking about the Silk Road Economic Belt, President Xi has stated that “amity between people holds the key to sound relations between states.” He also highlighted the importance of “common aspirations,” given that the Silk Road will be supported by countries only if it is able to benefit people. China will inherit and pro-mote friendly cooperation along the Maritime Silk Road and develop a proposal with international consensus so that marine cooperation and partnerships will be firmly supported.

The plan will also call on countries to increase marine awareness and achieve common aspirations. China needs to make full use of the geopolitics and culture of Maritime Silk Road to promote exchanges in marine culture, tourism and education to make the Road a key link for friendly exchanges. By “going global” and “going local” at the same time, China needs to carry out exchanges and cooperation in marine culture, in areas such as cultural or art exchanges, archaeological exchanges, marine tourism cooperation, education and training.

China will guide and encourage the community to conduct various cultural exchanges and offer tours and products with distinct Silk Road features. In such a way, China will be able to expand the cultural influence of the Maritime Silk Road, push the Road into the new century and promote general marine cultural diversity.


On June 20, 2014, Premier Li Keqiang spoke at the China-Greece Marine Cooperation Forum, stating, “We stand ready to work with other countries to boost economic growth, deepen international cooperation and promote world peace through developing the ocean, and we strive to build a peaceful, cooperative and harmonious ocean.” China’s proposal to build a 21st Century Maritime Silk Road suits the current era and is characterized by peace, development, cooperation, innovation and opening-up. With the goal of building a harmonious ocean, the proposal rests on opening-up and innovation and aims to achieve “harmony between humans and the ocean, peaceful development, safety and convenience, cooperation and win-win results.” A 21st Century Maritime Silk Road will enhance cooperation between China and other countries, increase mutual trust, create a stable environment for cooperation and bring new opportunities for regional stability and prosperity.

by Liu Cigui

China Institute of International Studies


China’s Initiatives of Building Silk Road Economic Belt and

Xi suggests China, C. Asia build Silk Road economic belt · Chinese President Xi Jinping … China, Maldives share dream of 21st Century Maritime Silk Road.

The keys to China’s success

China National Day_Female guard  Female Honor Guards train for National Day celebration Video:

The institutional system and decision-making capabilities of democratic centralism have proven to be the country’s advantage

This year marks the 65th anniversary of the founding of the People’s Republic of China, the 60th anniversary of the establishment of people’s congress system and the 65th anniversary of the establishment of the Chinese People’s Political Consultative Conference. In the past 65 years China has developed rapidly and has made great achievements. Democratic centralism is the core mechanism of the China model, the key to the China miracle, and China’s advantage compared with other major developing countries.

China is still a developing country, and it lags behind the developed countries in many aspects. But it would be wrong to always attribute the developed countries’ achievements to their democratic system. It’s also wrong to deny China’s success because of some partial setbacks or mistakes and to blame these on China’s democratic system.

Democratic centralism is an institutional system as well as a decision-making model. Democratic centralism is an organization principle of the governing Communist Party of China, as well as national organizations, which links the CPC and the national mechanism based on the people’s congress system.

Under democratic centralism, the decision-making process is first democratic discussion and then consensus on opinions on a democratic basis, which guarantees the decision-making process responds to public opinion to the greatest extent.

Currently there are two major political systems in the world: democratic centralism and representative democracy. If we want to make a comparison between the two systems, we should first make sure the premise of “comparability” holds. In other words, China should be compared with those developing countries that also have a long history, huge population and suffered a long time as a colony or semi-colony.

We can divide all the 12 countries with populations of more than 100 million into three groups. The first contains developed countries such as the United States and Japan, whose development is not due to representative democracy, but freedom of speech, rule of law, a market economy and exploitation of other countries.

The second group contains countries that have turned to representative democracy such as Russia. In the 1990s, the former Soviet Union fell apart and terrorism was widespread. The public called for Vladimir Putin’s “controllable democracy”, which has enabled Russia to revive.

The third group contains those developing countries that were colonized for a long time, such as Bangladesh, Brazil, China, India, Indonesia and Pakistan.

Representative democracy is the bottleneck for most of these countries’ development and their people’s welfare because of strong social forces and weak national power. The political organizations and family forces behind representative democracy make local social forces in these countries ever stronger, while national power is often too weak to turn national will into reality in this political system.

Some Western people compare India with China and expect India, the largest democracy according to the West’s definition, to surpass China someday because they believe that representative democracy is the biggest advantage of India.

Yet in the Human Development Index, China has risen from the rank of 101 in 2001 to the rank of 91 in 2014, while India has dropped from 122 in 2001 to 135 in 2014. In the Poverty Population Index, 11.8 percent of China’s population is below the international poverty line, while the percentage of India is 32.68. In the Corruption Perceptions Index, China ranks 80th while India ranks 96th. In the Ease of Business Index, China ranks 90th while India ranks 134th. In 2013, China’s per capita GDP was $6,629, which is more than four times the $1,592 of India. The gap of per capita GDP between China and India is larger than two decades ago.

Why has the gap between China and India become larger? India is a democratic society but still has some feudal legacies, and the unfairness under feudalism can hardly accelerate market economy development. As to its “superior” political system, Indian-American political commentator Fareed Zakaria describes it as “bandit democracy”. That means, a candidate who committed a crime yesterday may be elected today. India has about 2,000 parties. The country’s high degree of fragmentation means it fails to propel public policies that benefit its citizens. The representative democracy of India is fragmented democracy that lacks authoritative policy execution.

Compared with the major developing countries that practice representative democracy, China’s centralized democracy guarantees freedom, autonomy, a market economy and also authoritative governmental organizations. China has a lead in governance compared with other major developing countries mainly because of democratic centralism.

Democratic centralism has gone through the first stage during the revolutionary period, the second stage during the first three decades after the founding of New China, and the third stage during the three decades after reform and opening-up. From history and reality we can clearly see the advantages of this political system.

By Yang Guangbin (China Daily)/Asia News Network

The author is a professor of political studies with Renmin University of China.

Related posts:

China cutting edge technologies: Naval Missile Def...


China on road to depeen reforms

The Communist Party of China (CPC) has to
acknowledge the market’s decisive role in allocating resources as it is
proven to be the mo…

17th Asia Games 2014 Medal Tally – 30/9/14

Rank Country Gold Silver Bronze Total
1 China 120 76 58 254
2 Korea 50 53 59 162
3 Japan 37 50 54 141
4 Kazakhstan 15 16 24 55
5 Iran 12 11 10 33
6 DPR Korea 8 10 11 29
7 Qatar 8 0 3 11
8 Chinese Taipei 8 8 14 30
9 Thailand 7 4 14 25
10 India 6 8 31 45
11 Uzbekistan 5 5 13 23
12 Hong Kong 4 6 20 30
13 Mongolia 4 4 10 18
14 Malaysia 3 9 9 21
15 Bahrain 3 5 1 9
16 Indonesia 3 4 7 14
17 Myanmar 2 1 0 3
18 Vietnam 1 9 20 30
19 Singapore 1 4 7 12
20 Kuwait 1 3 2 6
21 Saudi Arabia 1 1 0 2
22 Tajikistan 1 1 0 2
23 Pakistan 1 0 1 2
24 UAE 1 0 1 2
25 Macau 0 3 0 3
26 Kyrgyzstan 0 2 2 4
27 Philippines 0 2 2 4
28 Turkmenistan 0 1 2 3
29 Laos 0 1 1 2
30 Bangladesh 0 1 0 1
31 Lebanon 0 1 0 1
32 Iraq 0 0 2 2
33 Sri Lanka 0 0 1 1

India’s Mars success boosts space research


India Mars_ModiIndia’s Mangalyaan probe entered orbit around Mars Wednesday morning, which has been hailed by the public throughout the country. People across India, from the authorities to media outlets, feel proud of the fact that India has become the fourth power to put a satellite into orbit around Mars after the US, Russia and Europe. The Indian public fully expressed their elation at having surpassed China in Mars exploration. China’s first Mars exploratory probe, Yinghuo-1, went missing one year after its launch in 2011. There is rhetoric on India’s Internet that the success of Mangalyaan is pouring salt into China’s wounds, which, however, is too serious and strong a characterization.

Apparently, China will not feel jealous of Mangalyaan entering Mars orbit. Chinese people understand that they boast much more advanced technological, economic and social development than India does.

Actually, Chinese people have myriad reasons to feel delighted at the success of the Mangalyaan probe alongside Indian people. If a country that is relatively backward in scientific research is able to send a probe to Mars, it is highly possible that Yinghuo-2 may succeed in the future.

No country can claim to be a leader in every arena. India has proved this point in its competition with China.

When poor nations participate in the space race, they are often sneered at by others and criticized domestically as well.

India sees itself as a major power that is supposed to do something “irrelevant with people’s interests” in the eyes of populists. A small country can be composed of schools, hospitals, restaurants and washrooms, while a big one must possess much more advanced technology such as satellites and nuclear-powered submarines, as well as constantly seek technological breakthroughs.

India’s space exploration endeavor, against its prevailing social conditions, should be reflected upon by Chinese people. China’s space program and the relevance to its social development level were subjected to intensive Western public scrutiny, but the West takes China’s competitiveness in space seriously now. India reminds us of the importance of taking the first step.

Though Yinghuo-1 was outperformed by Mangalyaan, China’s aerospace sector has made precious achievements in space, such as manned spaceflight and building space stations. Without these previous efforts, we will still be absent in some core fields.

Mangalyaan brings us more affirmation than a sense of competition. Among Net users from both countries, acrimonious remarks are heard against each other, creating an impression that China and India are mired in deep hostility.

But any real conflict of interest between the two is much less serious. Bilateral cooperation is entering the prime stage.

Source: Global Times Published: 2014-9-25

World largest IPO: Alibaba shows optimism for China initiates new era and changes in Internet

Video: Alibaba’s long road to Wall Street

 Alibaba IPO shows optimism for China 

China’s e-commerce giant Alibaba made its debut successfully on the New York Stock Exchange Friday, becoming the world’s second-largest Internet company after Google. The complicated structure of Alibaba and the hype by mainstream media outlets in the US about its operation risks have failed to hold back global investors from chasing after its stocks. Its shares surged 38 percent on the first day of trading.

The growth of Alibaba is an unusual experience integrating China’s opportunity and national conditions with Western capital and the world’s confidence in the Chinese market. It has wielded a super influence upon the Chinese market and won the utmost confidence from the market. The impressive IPO, the biggest ever in US stock market history, can be viewed as a union connecting Chinese society and the rest of the world.

The West also thinks highly of what China regards as quite promising. This is what the New York Stock Exchange told us on Friday.

The complexity of China can hardly be thoroughly understood by ordinary Western investors. Alibaba was preparing its IPO amid economic transformation in China. When the opening bell at the New York Stock Exchange rang, people bet not only on bright prospects for the company, but also on the stability of China’s gradual market-oriented reform. The IPO demonstrates that the predictions of the West toward China are not as pessimistic as some media have reported.

There are two reasons why Chinese people have confidence in Alibaba. On the one hand, Alibaba is deeply rooted and also rises from the market; and on the other, the public has recognized that e-commerce represents the future. They are in increasing favor of marketized private enterprises and the high degree of market economization is affecting social confidence and resource allocation.

Now it seems that the rest of the world sometimes follows in the footsteps of the Chinese. China’s huge potential, developed with its own Chinese characteristics, is now making its mark, which may lead Westerners to redefine their attitudes in accordance with the wishes of Chinese people. Both Chinese and Westerners need to adapt to and accept the reality Alibaba displays and comprehend its predictions about the future.

Why Alibaba decided to list in the US, though a shallow and improper question, involves a healthy and active aspiration that is not contradictory with the general global trend. Alibaba represents an era of the development of China’s private Internet firms.

More support is needed for a new era. Chinese investors should not only play a major role in such feasts as Alibaba’s IPO but also possess the ability to share the prospects. Will Alibaba surpass Google and become the largest Internet company in the world one day? Perhaps. China now boasts more than 600 million Net users and Alibaba displays a more genial access for new users throughout the world.- Global Times

Alibaba IPO initiates new era in which China changes Internet

Ali_IPOChinese Internet-based e-commerce giant Alibaba launched its initial public offerings (IPO) in New York Stock Exchange on Friday. After pricing its stock at $68, Alibaba surged high on the opening day with its price soaring to $92.70, which gave the company a valuation of about $228.5 billion.

In terms of market value, Alibaba has become the fourth biggest high-tech company after Apple, Google and Microsoft, and the second biggest Internet-based company in the world.

This IPO, now the biggest ever, has become a landmark in the global history of Internet development. Showing up on the international stage as a world class corporation, Alibaba reveals new business models and ideas of Chinese style.

Alibaba’s IPO signals the start of a Chinese era in the global Internet. From 2005 to 2014, the population of Net users has increased dramatically and reached 3 billion worldwide.

Chinese Internet-based companies, starting from scratch, have grown to be leaders in the Internet community, engaging in a close competition with the US.

It is the trend of the age that keeps changing the world landscape, and customers are the basic forces to transform the situations of competition. The US remains dominant in most aspects. But after this experience, China will get the baton and take the lead.

So far, the average rate of Internet use in developed countries has surpassed 80 percent. They used their language advantages, high level of development and values to preside over the process in which the world Internet population has hit 3 billion.

However, in the next process to incorporate the other 3 billion people into the Internet community, developing countries will become the focus. China’s new Net users in the countryside can serve as the best example.

In this process, these Silicon Valley-based CEOs and product managers will find it difficult to master their user experience and habits.

Instead, China’s local enterprises such as Tencent and Alibaba will have more opportunities to acquire leadership in the new round of competition.

It is only a matter of time for the development of the Chinese Internet to surpass that of its US counterpart.

Alibaba’s IPO has unveiled the competition between China and the US in cyberspace. Although the US still gains an upper hand in the contest, China is catching up with it. And as long as China employs appropriate strategies, it will go beyond the US in many terms. In the future, China and the US will coexist in a mutually competitive and cooperative scenario.

Alibaba’s success in IPO signals that Chinese Internet-based enterprises are getting more involved in globalization. The Internet has changed China, and it is time for China to change the Internet.

By Fang Xingdong Source:Global Times Published: 2014-9-22

The author is director of the Center for Internet and Society, Zhejiang University of Media and Communications.

Alibaba Claims Title For Largest Global IPO Ever With Extra Share Sales

Alibaba Chairman Jack Ma celebrates his company’s IPO at the New York Stock Exchange on Friday. (Photo: Mark Lennihan/AP)

By Liyan ChenRyan Mac and Brian Solomon, Forbes

After claiming the record for the largest US-listed initial public offering, Alibaba Group can now say its record-breaking IPO was the biggest in the world.
On Monday, the company announced that underwriters had exercised an option to purchase additional shares at the $68 IPO price, boosting the total amount raised by Chinese e-commerce giant and its selling shareholders from $21.8 billion to $25 billion. Bankers bought an additional 48 million American depositary shares, taking the total amount of shares sold in the offering to 368 million, or about 14.9% of the company.
In raising $25 billion, Alibaba’s IPO surpassed the 2010 offering from the Agricultural Bank of China, which raised $22.1 billion in it debut on the Hong Kong Stock Exchange. Alibaba was able to sell more shares due to its over-allotment, or “greenshoe,” option, which allows underwriters to placate investor demand for the stock by obtaining more shares from the company at the IPO price.
Existing shareholders Alibaba Chairman Jack Ma, Vice Chairman Joseph Tsai and Yahoo YHOO -5.57% provided the extra shares sold in the over-allotment. Ma sold an additional 2.7 million shares, selling a total of about 15.5 million shares in the IPO, while Tsai sold 5.2 million shares, after offloading an additional 900,000 shares in the greenshoe.
By selling in the over-allotment, Yahoo became the largest seller in Alibaba’s IPO, surpassing the 123 million shares offered directly from the Hangzhou-based company. Yahoo sold an additional 18.26 million shares, offloading a total of 140.3 million shares in the IPO for more than $9.5 billion in pre-tax cash.
Alibaba began trading on Friday on the New York Stock Exchange, with shares opening up at more than 35% above the $68 IPO price. On Monday, shares have fallen below the $90 mark, down more than 4% in intraday trading.
Credit Suisse, Deutsche Bank , Goldman Sachs, J.P. Morgan , Morgan Stanley and Citigroup acted as joint book runners for the offering.

Alibaba’s IPO Pop Makes Jack Ma The Richest Man In China


By Liyan ChenRyan Mac and Brian Solomon

.The largest IPO in US history has put a new person on top of China’s richest.

As Alibaba shares surged over 35% to open at $92.70, founder and chairman Jack Ma’s stake in the company he founded boosted his net worth over $16 billion. That Alibaba stake pushes Ma above his rivals to the #1 spot as the wealthiest man in China. Ma’s total net worth grows higher when you calculate the $800 million in cash he pocketed by selling shares, which should rise to more than $1 billion once underwriters exercise their extra options. Ma also has separate stakes in private companies like Alibaba sister-company Alipay.

Ma’s rise to the top puts him ahead of former #1, Robin Li, another Chinese tech icon who founded search engine Baidu . Li sits at a net worth of $16.6 billion. Ma also leapfrogged the $15.5 billion man Pony Ma, whose Tencent is directly in competition with Alibaba over China’s growing mobile phone user base.

Ma’s net worth gain also places him into the top 10 richest people in tech worldwide, a group that includes Silicon Valley pioneers Bill Gates, Larry Ellison, Mark Zuckerberg, and Larry Page and Sergey Brin.
Read more about Alibaba’s first day of trading on Forbes’ live blog.

The Biggest U.S. IPOs In History

1 of 12
AP Photo/Kin Cheung, FileThe Biggest IPOs In U.S. History

The Biggest IPOs In U.S. History

Alibaba broke records as the largest IPO in history after
pricing its offering at $68 per share on Sept. 18, 2014. After an
overallotment option the total proceeds rose to $25 billion, easily
surpassing the likes of Visa and Facebook.

Alibaba Plans To Raise As Much As $24 Billion In Biggest U.S. IPO Ever

Related post: 

Two weeks, three continents, and 100 meetings. That — and founder Jack Ma
celebrating his 50th birthday on the road — is what it will take for
Alibaba Group Holding Ltd. to pull off the largest initial public
offering in U.S. …
 Tencent Holdings Ltd. (700) faces the prospect of losing its position as Asia’s most-valuable Internet company this year after Alibaba Group Holding Ltd. (BABA) goes public. The Shenz

Get every new post delivered to your Inbox.

Join 1,242 other followers

%d bloggers like this: