The emerging IT industry regained momentum, topping the list in both the number of venture capital deals and the amount of investments in the second quarter, followed by the traditional and service sectors.

"The IT industry will continue to net large amounts of venture capital in the months ahead," said Michael Kang, Managing Director of the Research Center at Zero2IPO.

Foreign venture capital is keen on the Chinese market. Among the 121 second-quarter deals, 92 companies acquired investments from foreign venture capital firms, while the rest were funded by domestic firms.

Industries attracting investment from the two groups varied widely, with foreign venture concentrating on the IT, service and bio-healthcare segments, while domestic venture capitalists were active in traditional and non-IT hi-tech industries.

However, the Zero2IPO's senior economist Andy Xie pointed out that traditional industries, instead of the favored IT sector, are desperately in need of capital.

High on the Hog

Though the price of pork has fallen for the past four weeks, it still remains higher than consumers expect. An insufficient pork supply and rampant blue-ear disease have cut the number of pigs in the country, providing an opportunity for foreign pork retailers to fill the void.

Smithfield Foods Inc., the biggest pork supplier in the United States, announced on August 27 that it would sell 60 million pounds of pork to China in cooperation with a Chinese counterpart. This is the largest ever pork export by a U.S. company.

According to the contract, the company will export high-quality lean pork that is as good as that sold in the U.S. Smithfield has not yet released the name of the Chinese company it is cooperating with. All the pork will be shipped before the end of 2007. The share price of Smithfield increased on New York Stock Exchange on news of the announcement.

"We are glad to establish business ties with this Chinese company, and we are expecting more orders from China, which will mark a good beginning for stable and continuous cooperation," said Smithfield in a company press release.

It is expected that the imported pork will be sold at around 80-100 yuan per kg, about two times higher than that of the domestic pork. Therefore, the imported pork will be mainly serving high-end consumers.

Bi Jingquan, Vice Director of the National Development and Reform Commission, contended that the domestic companies can import pork according to domestic needs with reasonable prices but denied the possibility of large-scale pork imports.

From Electronics to Fashion

Huang Guangyu, named by Forbes magazine as the richest man on the Chinese mainland, has entered the fashion business by pouring 3.8 billion yuan into building Eagle International Fashion Mart (EIFM).

Huang is the founder and President of Eagle Investments, which holds Gome Electronics, one of the largest electronics retailers on the mainland.

The fashion center EIFM covers 600,000 square meters and will be opened on August 1, 2008. EIFM will mainly hold fashion press conferences, exhibitions, and negotiations. Currently, it has signed a long-term partnership deal with French Fashion TV and the Italian World Fashion Channel.

Home appliances and real estate are two major industries heavily invested in by Huang. Eagle Investment analysts disclosed that the reason for turning to the fashion business was that Huang had an eye on business opportunities brought about by the 2008 Beijing Olympics. They expect retail sales in Beijing to surpass 280 billion yuan, among which fashion products will account for a large proportion.