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Olympics Hot Sheet - September 9, 2004

1) Why Does Construction of 'Bird's Nest' Halt?
2) Construction of Beijing Shooting Range Officially Started
3) The 2nd Beijing 2008 Olympic Cultural Festival Closed
4) Contract for the Architectural Installation Project of the National Swimming
Center Signed
5) Bank of China - Second Partner of BOCOG
6) BOCOG Announced Latest Partners - China Mobile, CNC and Air China
7) Shenyang Wulihe Stadium Seeks Cooperation
8) Main Structure Construction of National Swimming Center to Start
9) Shenzhen to Build an 80,000 Seat Olympic Sports Center
10) Completion of Beijing Tennis Center Delayed
11) Emma Signed the Ticketing Contract for China Tennis Cup
12) Beijing Stadiums Operation No More Needs Executive Permission
13) The Value of Sports Sponsorship
14) The 15th China International Sporting Goods Show (Winter)
15) Olympic Official: No Big Changes in Plans
16) Samsung Ready for 2008 Games
17) French firm ready for Beijing Games
18) Preparation for Olympics Begins in the Restroom
19) Foreign Firm Faces Beijing Games Hurdle

1) Why Does Construction of 'Bird's Nest' Halt?
The National Stadium for the 2008 Beijing Olympic Games, the 'bird's nest', has temporarily ceased construction since July 30. The originally noisy construction site now sits silent.

Owing ballooning cost estimates, the temporary halt of construction is to allow time for design adjustments of the major Olympic projects; the 'bird's nest', the National Swimming Center and the Wukesong Sports and Culture Center.

The 'bird's nest' is designed by Swiss designers, with the original budget of USD 400 million (RMB 3.5 billion). However, when the construction started, it was found that the practical cost exceeded the budget by a large margin, which aroused the attention of many experts and officials. According to Mr Wei Jizhong, executive member of BOCOG, the temporary halt of construction of the 'bird's nest' is to make adjustment to part of the design for safety reasons, but the main reason is to cut down the cost of the project.

The growing expenditure on the Olympic projects has largely exceeded the budget, which has brought high attention of the central government and Beijing city. Not long ago Beijing put forward the notion of 'being thrifty on the Olympic Games' in order to reduce cost and promote efficiency, and integrate the construction of the Olympic projects with the overall planning and long-term development of Beijing. The temporary stand of the construction of the 'bird's nest' for adjustment was made under this background.

Wei said that the 2000 Sydney Olympic Games left a great number of the stadiums and venues unused. We should learn their lesson and reduce wastes of resources. We have gladly seen that BOCOG is both saving cost and seeking funding through market channels. The changes made on the 'bird's nest' will be beneficial for post game management and operation of the venue.

2) Construction of Beijing Shooting Range Officially Started

On the date of the third anniversary of Beijing's successful bid of the 2008 Olympic Games, July 13, 2004, the construction work of the Beijing Shooting Range officially started.

Beijing Shooting Range is a newly built Olympic venue under the responsibility of State General Administration of Sports of PR China, covering 45645 sq. m with 9000 seats. The Architectural Design Institute of Qinghua University accomplished the design for Beijing Shooting Range, Beijing Zhonglianhuan Construction Supervision Co is the supervisor of its construction, and the general contractor for construction is China Construction Bureau 2nd Department.

3) The 2nd Beijing 2008 Olympic Cultural Festival Closed

The 2nd Beijing 2008 Olympic Cultural Festival officially started on June 23, 2004. A variety of cultural activities were held during the three-week long celebration, such as the Olympic knowledge contest, Olympic exhibitions, forums, cultural shows and sports activities. Qingdao Olympic Sailing Organizing Committee organized rich cultural events to correspond to the Beijing Festival.

The closing ceremony of the Festival was held at China Century Altar on July 13, the day on which Beijing won the bid for the 2008 Olympic Games. At the closing ceremony, the emblem for the 2008 Paralympic Games was released.

The Beijing Paralympic emblem is consistent with the Beijing 2008 Olympic emblem in style and cultural elements. President of International Paralympic Committee Mr Philip Craven praised that the Beijing Paralympic emblem fully displayed the Chinese culture and was a perfect combination of the Chinese culture and the spirit of IPC.

4) Contract for the Architectural Installation Project of the National Swimming Center Signed

The general contract for the architectural installation project of the National Swimming Center was signed on July 17, 2004 in Beijing Hotel. The owner is Beijing State Asset Management Co and the contractor is the China Construction Development Co Bureau 1. The value of the contract is USD79.9 million (RMB660 million).

The selection of the general contractor for the project through public tender started in this March. China Construction Development Co. Bureau 1 won the tender by its scientific design, reliable security system and reasonable quoted price. The company was responsible for the construction of the World Trade Center 2nd Phase project and is a high-quality construction company, winning 'China Construction Engineering Luban Prize' many a time.

The National Swimming Center is located in the Beijing Olympic Park. Its funding comes from the donation of domestic and overseas Chinese. Since the construction started on December 24, 2003, all work has been going on smoothly.

According to sources, during the construction of the National Swimming Center, the site will be open to the public step by step. Visit routes, exhibition rooms and introductory brochures are currently under preparation.

5) Bank of China - Second Partner of BOCOG

'The Olympic logo will be printed on the business card of Bank of China,' said a Senior Manager of Bank of China excitedly. On July 14, BOCOG signed the contract with Bank of China, which officially became the banking partner of Beijing 2008 Olympic Games.

As partner of BOCOG, Bank of China will provide plenty funding, financial products and related services to Beijing 2008 Olympic and Paralympic Games, BOCOG, COC and the Chinese delegations that will participate the 2006 Torino Winter Games and 2008 Olympic Games. It will assist BOCOG with cash receipt and payment, asset management and exchange rate risk-void measures. In addition, Bank of China will provide safe and convenient payment solutions and services in and outside of China for the Chinese delegation, the athletes, spectators and visitors. It will also provide financial services to Beijing Olympic venues and associate facilities construction as well as urban infrastructure construction. BOCOG will reward Bank of China with corresponding returns.

Bank of China is the 2nd partner of BOCOG after Volkswagen.

6) BOCOG Announced Latest Partners - China Mobile, CNC and Air China

In 2008, China Mobile users will likely be able to view matches on mobile phones, Mr Lu Xiangdong, Deputy General Manager of China Mobile Communications Group, disclosed to the media after the company signed the partnership agreement with BOCOG on July 21,2004.

China Mobile is the 3rd company that has joined BOCOG¡¯s partnership program. As the mobile communication partner for 2008 Beijing Olympic Games, China Mobile will provide mobile communication network and service to the 2008 Beijing Olympic and Paralympic Games, BOCOG, COC and the Chinese delegations that will participate the 2006 Torino Winter Games and 2008 Olympic Games.

China Mobile Communications Group Co was set up on April 20, 2000 according to the requirements of the reform of telecommunication system. The registered capital of China Mobile is USD6.3 billion (RMB 51.8 billion) and its total asset exceeds USD48.4 billion (RMB 400 billion). It ranks 242 in the latest list of the world's top 500 by Fortune.

China Mobile is the only communications operation company that specializes in mobile communications in China. The scale if its network and the number of its users rank top in the world. By 2003, it has established its network in most counties and cities throughout China, and its users have surpassed 177 million. Its users can enjoy global access service in 176 countries and regions across the world.

BOCOG has announced other two enterprises that joined the partnership program lately, and they are CNC and Air China. CNC (China Netcom) signed the agreement with BOCOG and became its fixed communication partner on July 22, 2004. Air China signed the partnership agreement with BOCOG on August 4, 2004 and will provide air passenger transportation services to the 2008 Beijing Olympic Games.

7) Shenyang Wulihe Stadium Seeks Cooperation

Shenyang Wulihe Stadium is one of the venues for the 2008 Olympic Games football competition. Shenyang Municipal Government has decided to invest USD67.8 million (RMB 560 million) to completely reform the current stadium and the work is scheduled to start early next year and complete by the end of 2006.

Wulihe Stadium was built for the 2nd National Youth Games in1989, and was refurbished for the first time in 2001 before the Asian qualification final of the 17th World Cup. Its turf is in good condition and meets the international standard, but the electric systems, interior and exterior furnishing have been timeworn and need refurbishment.

On July 8, 2004, Shenyang Government released to the public the refurbishing and financing plan for the reform of the Wulihe Stadium. The Stadium will adopt the BOT model, and aims to attract US$ 40 million through the tendering process. However, according to the Shenyang Sports Administration, BOT is not the only financing plan for the Wulihe Stadium; Shenyang may choose optional means of financing channels based on the practical circumstances.

At present, the Wulihe Stadium has started to seek business partners. Its refurbishing projects include: the reform of the main stadium building and the main field, the construction of two pieces of training fields, the reform of functional rooms, spectator stands, lighting systems and audio visual systems, the layout of the surrounding environment, the parking area and the business area etc. The owner will provide the land and technical documents, while the investing partner will provide means of financing, seek business partners through joint-investment or joint venture, or cooperate on the BOT model.

8) Main Structure Construction of National Swimming Center to Start

After the general contract for the architectural installation project of the National Swimming Center was signed on July 17, 2004 in Beijing Hotel, Mr Li Aiqing, President of Beijing State Asset Management Co, said that the groundwork for the National Swimming Center has been completed and the main structure construction will begin soon by the contractor, China Construction Development Co. Bureau 1.

According to Mr Li Aiqing, since the construction of the National Swimming Center started on December 24, 2003, all the work has been going on as scheduled. He introduced that there are still a number of specialized projects to go under public tender towards national and international companies, such as the membrane structure technology and machinery and electric products.

China Construction Development Co. Bureau 1 has started to take over the work from the ground construction company since the signing of the contract.

9) Shenzhen to Build an Olympic Sports Center of 80000 Seats

Shenzhen Municipal Government has put on its construction agenda a large stadium of a capacity of 80000 seats. The estimated space for the Olympic sports center is 1 sq. km and the location will be selected out of Nanshan and Longgang Districts. According to the latest Shenzhen Government Report, Shenzhen Municipal Government has already set up the leadership for the construction of the Olympic sports center.

According to an official of Shenzhen Sports Administration, Shenzhen is bidding to host an important sports game that will be held in 2011, which is one of the reasons to build the Olympic sports center. There are still some competitions that require high-level sports facilities, in addition, the current stadiums and sports venues in Shenzhen cannot meet the exercising needs of the general public.

10) Completion of Beijing Tennis Center Delayed

The completion of Beijing Tennis Center was originally scheduled at July 15, but now the date is set at August 20. The change was made in order to ensure the quality of the construction. The organizing committee invited an Australian engineering evaluation company in June, which gave valuable advice to the overall construction work. The construction company made several large adjustments to the original design, such as increasing entrances and exits for spectator distribution, and dealing with the suite glass reflection problem which influences the athletes' performance.

Beijing Tennis Center occupies 10000 sq. m and is a two-storey building. Altogether there are 21 pieces of tennis courts in the Center. A large LED scoring board is installed at the stand's side. Outside of the main court, a large screen will be installed for the viewers without tickets to watch the match live.

11) Emma Signed the Ticketing Contract for China Tennis Cup

On July 12, Emma Ticketing Co signed a long-term contract with the Organizing Committee of China Tennis Cup on the ticketing for the first such tennis event in the coming September.

The goal of the organizers of China Tennis Cup is to raise its status to be one of the most important five tennis events in the world. As one of the major sports events in Asia, China Tennis Cup will become a significant asset for the preparations of the 2008 Beijing Olympic Games. The event will be held in the newly built Beijing Tennis Center from September 10 to 26.

Emma Ticketing Co was jointly set up by Xiaohongmao Co under Beijing Youth Daily Group and Emma Entertainment Co. Sun Kanglin, Secretary of the Organizing Committee of China Tennis Cup, said that the cooperation between China Tennis Cup and Emma was a good news to the tennis fans because they would enjoy the professional and convenient services of Emma.

12) Beijing Stadiums Operation No More Needs Executive Permission

According to the latest Law on Executive Permission that came into effect on July 1, 2004, Beijing abolished 137 categories of executive permission, including executive permission on 4 sports categories: assessment on professional venue technical personnel employed by sports facilities management bodies; certification of professional sports technical personnel employed by the sports entertainment business; inspection on the qualification of sports entertainment business operation; approval on the operation of swimming pools or gymnasiums.

Will this cause vacuum administration in the sports market with the annulment of the above regulations? Chief of Market Management Office of Beijing Sports Administration Mr. Fan Zheng told the media that Beijing's sports market would not see absence of administration.

According to Fan, China is currently implementing the administration on sports businesses through standardization, which includes compellent standards and recommending standards. Among the 99 categories of sports that the State General Administration of Sports administers, 13 of which such as racing, skiing and swimming will apply compellent standards, in that these sports categories are directly connected with the safety of people's lives and properties. The standards on swimming have already been promulgated. The rest 86 categories will apply recommending standards. Beijing Sports Administration is working together with Beijing Technical Monitoring Bureau on drafting general guidelines on sports entertainment business operations for the convenience of enterprises in the sports business.

Fan further elaborated that the management on sports operation organizations has shifted from executive approval before operation to supervision and punishment in operation. This will allow the enterprises more autonomy in operation and meanwhile strengthen the management. The changing from an 'administrative government' to a 'service government' will bring true benefits to the enterprises and thus provide better service to the general public.

13) The Value of Sports Sponsorship

The latest survey released by Lingdian Research Network Co. shows that nearly 80% of Chinese have a favorable opinion towards the enterprises that sponsor the Olympic Games, and 75.1% are more inclined to buy products or services branded with the Olympic emblem. Among the 79.9% of people who are more favorable of the Olympic sponsoring companies, 87.7% are between 18 and 25 years old.

The survey shows that sports sponsorship is an appealing emotional investment in sports fans and even the general public. It can instantly transform people's likeness in sports into psychological acceptance of the sponsoring products, and the vehement sports atmosphere can influence people's consuming preferences and stimulate consumers to buy. People between 18-25 years and 36-45 years are most enthusiastic to choose products or services associated with the Olympics.

The survey discovers that Chinese people regard IT and food & drinks the most suitable industries to sponsor the Olympic Games, the rest are the telecommunications and the automobile industries. Most people wish to see more Chinese enterprises sponsoring the Olympic Games.

Household survey conducted in 6 major cities including Beijing and Shanghai, and 6 counties and towns in Liaoning and Yunnan provinces. Sample size: 3247 persons between 18 and 60 years old. Source: The Commercial Value of the Olympic Games by Lingdian Research Network Co.

14) The 15th China International Sporting Goods Show (Winter)

Time: September 27-29, 2004
Venue: Beijing Exhibition Hall
Organized by: State General Administration of Sports
China Sporting Goods Federation

Exhibition includes:
Winter sports equipment
Winter sports ware
Ski related equipment and products
Outdoor sports ware and equipment
Children and youth sports equipment
Sports facilities construction technology and materials

Fees: Standard booth (3m¡sm) USD823(RMB6800)/per booth
Indoor space (over 27 sq. m) USD74 (RMB610)/sq. m

15) Olympic Official: No Big Changes in Plans

Beijing Olympic organizers pledged that suspended construction work on projects for the 2008 Games would soon be resumed.

The construction of a couple of main venues for the 2008 Games including the National Stadium which will host the opening, closing ceremonies and football finals, has halted, raising nationwide speculation that the original designs for the venues are too much for the organizers to handle.

The stadium dubbed the “Bird Nest” for its nest-like outlook, is jointly designed by Swiss company Herzog and de Meuron Architects and the China Design and Architecture Institute. But construction experts claim that the plan will difficult to realize and is expected to consume a massive 50,000 tons of iron and steel.

Another stadium, the Wukesong Cultural and sports Center, which is slated to host the Olympics basketball competition, also drew criticism form experts.

They claimed what will be the world’s biggest television screen which will cover the entire surface of the stadium, might cause light pollution and make it hard for surrounding residents to sleep at night.

16) Samsung Ready for 2008 Games

When the Olympic flame faded, the missions of many athletes, participants and spectators came to an end, but Sunny Hwang knew it was the signal of a new beginning.

Hwang, director-general of the sports marketing group of the South Korean firm Samsung Electronics was seen as the most successful TOP(the Olympic Partner) sponsor by the International Olympic Committee and the other TOP Sponsors at the world’s biggest sporting event held in Athens from August 13 t0 29.

Hwang believed his company stood out in three areas: sponsorship of the global torch relay, the establishment of the Olympic Rendezvous at Samsung, and huge advertising campaigns.

Hwang said his company had spent US$200 million on Olympic Games sponsorship and marketing.

The reward for the investment has been high. When the Athens Games Drew to close, Hwang stared his new mission. Samsung Electronics is beginning to make preparations for it marketing campaign for the Torino Winter Olympic Games in 2006. After March, 2006 they will shift all resources to the 2008 Beijing Games.

Samsun Electronics will also co-operate with Chinese sponsors in Sports marketing for the Olympics. They haveconducted some exchanges with the Chinese computer maker Lenove Group, the first Top Sponsor from China in computing equipment for Beijing Olympics.

17) French Firm Ready for Beijing Games

Atos Origin, a leading global IT Services Company, is gearing up for the 2008 Beijing Olympic Games where it will manage a vast information Technology (IT) system.

But for the French company, IT partner and TOP sponsor of Olympic Games, there is one ambition behind the Olympic mission – breaking into the vast Asia-Pacific market – especially China, the next Olympic host, and India.

As the Althens Games’ curtain fell on Augest 29, the group has already put the Beijing mission on its schedule, sending a professional IT team within a few days to set up the IT framework needed for the Beijing Games.

Major preparatory work will start after the 2006 Turin Winter Olympic Games, its next service target, but Bourigeaud Said the work will begin as early as possible.

In December 1998, the company, originally as SchlumbergerSema, signed the largest sports IT-related contract ever, covering the Games for more than eight years including the 2002 Salt Lake City Winter Games, the 2004 Athens Summer Games, the 2006 Turin Winter Games and the 2008 Beijing Summer Gmes.

Earlier this year, Atos Origin complete the acquisition of SchlumbergerSema, creating one of the leading IT company in the world with combined annual revenues of more than 5 billion euros ( US$6.04 billion) and about 50,000 staff workers in more than 50 countries. It also simultaneously took over the baton from SchlumbergerSema of sponsoring the Olympic Games.

With its coverage of Beijing Olymics Games, the company has set its sights on the Asian market which is seen as its next target.

18) Preparation for Olympics Begins in the Restroom

China intent on avoiding Greece’s embarrassing last-minute scramble, is on a spending spree far in advance of the 2008 Olympics, with toilets a significant part of the planning. Headlines last week heralded a $12.1 million 2004 budget for public toilets in Beijing, a sharp increase from last year’s figure.

Bringing improvements to the nation’s public toilet network has reversing a Communist legacy that paid little attention to consumer infrastructure or individual amenities. China reputedly has some of the foulest toilets in Asia.

Beijing now boasts 7700 public toilets ranging in quality from recognized four-and five star genre to the admittedly squalid. Several hundred additional units are slated for the nest few years.

To keep up the momentum, Shanghai plans to play host to the World Toilet Expo & Forum in May 2005, the industry’s premier event.

19) Foreign Firm Face Beijing Games Hurdle

When Australian Architect PTW won the contract to design a swimming center for Beijing Olympics, the firm was ecstatic. While a significant achievement for the Australian firm, the procedure it had to go through to secure the contract says a lot about the difficulty foreign firms have trying to grab a slice of the lucrative construction work that will to into the 2008 Olympics.

Yet Beijing official such as Liu Jingmin, vice-mayor and executive vice-chairman of the Beijing Olympics Organising Committee disagrees, stressing that contracts are awarded according to international standard practices, in an “open and fair” process.

However, many of the rules hampering foreign firms are not a handover from China’s protectionist days but issued earlier this year- and lawyers say they are within the WTO guidelines. The two most restrictive for foreign competitors are rule 113 for construction firms and rule 114 for design firms, both inaugurated this year.

The new rules permit work on multiple projects but set a high bar for entry. Generally under both rules, the foreign contractor must form a local join venture and mainland partners must put up 33 percent of the registered capital, as USD36.3 million (RMB300 million) – a hefty burden for local firms.

Foreigners eager to tackle the market on their own are restricted to just four types of project, all of which must be funded by international lender unless the foreign firm is willing to put up at less 50 percent of the capital.

Meanwhile, construction firms are required to set up shop with more than 300 staff before they can ask for Olympics work, a huge investment without guarantee of a steady supply of work.