Running your own business is a big step towards creating a new lifestyle, making money, gaining personal and financial freedom. With this increased freedom comes increased responsibility,

Running ANY business ALWAYS comes with an inherent RISK.

Depending on the nature of the business, these risks can vary in frequency and intensity. You might not think that YOUR business would never get sued, but here’s where you would be wrong. Very wrong.

The GOOD THING is when you implement an effective ASSET PROTECTION PLAN, you are able to ensure the future of your business, finances and peace of mind.

In America society, there is an deficit of money, and an excess of lawyers. You can bet that if your business does ANYTHING wrong, the wronged person will consider suing your for something.

Once you receive this lawsuit (which will probably be one of the worst days of your life) you’ll realize the importance of asset protection. But it will be too late….

Once your assets are frozen and you can’t even buy a sandwich because of your frozen bank account, then you’ll wish you could have signed up. But it will be too late..

This lawsuit could come from THE MOST TRIVIAL EVENT! And it could involve VERY, VERY LARGE AMOUNTS OF MONEY.

Insurance is good, but a true asset protection plan involves much more…

Lets say you hold a party at your apartment, and someone decides to drive drunk (not an impossible situation, right? Not your business I know, but bear with me) and hits another car, killing the driver. The drunk driver has no assets, so the lawyers skip suing him and jump right to your. Because you procured the alcohol, you are liable for the man’s death (and his son’s education for 18 years.) See the disconnect between ACTUALLY your fault, and how important  it is to become protected.

People will sue you for ANYTHING nowadays.

You could be sued for ALMOST ANY ACTION of your business… and depending on your age or occupation , your home, your family and even your parents could ALSO be placed in financial peril for your mistake!

How would you feel if you were responsible for your parents financial collapse, not being able to retire, paying for expensive lawyers simply because you did not take the quick, easy, painless steps to form a Delaware LLC

Starting a company is a complicated affair, but one part that isn’t complicated is the ABSOLUTE NECESSITY of PROPERLY REGISTERING YOUR COMPANY in a STATE OPTIMIZED FOR ASSET PROTECTION with a BULLET-PROOF OPERATING AGREEMENT

If you have a business now, and it is NOT registered as an IBC,LLC, C-CORP, SCORP etc, you are effectively operating as a sole proprietorship with unlimited liability.

Do you realize that if you do not register your business or idea properly, and you operate as a sole proprietorship, you could be liable for the actions, or negligence of your business to the cost of thousands or hundreds of thousands of dollars?

Do you also realize that we live in a highly litigious society where thousands of people are sued EVERY day?

There is NO major business in the world that operates as a sole proprietorship because it is TOO RISKY

All businesses have inherent risk BUT if you are running a business that hasn’t been properly registered à this is risk with NO REWARD!

Registering your business idea as a company is quick, simple, and affordable and provides “insurance” so that you will never be successfully sued for the actions of your business so that you can run your business safely, securely and effectively.

We have an offices set up in THE BEST STATE in the country for ASSET PROTECTION – Delaware. And we are willing to offer you a discount rate if you sign up for an LLC through our agency WITHIN 24 HOURS.

————-SIGN UP NOW————

WHY DELAWARE?

• Laws of incorperation in Delaware are TAILORED to attract businesses because of their flexibility,
• developed case law, simple tax rules and many other advantages.
• 90% of new Ipo’s are formed in Delaware
• 2/3′s of all companies formed in Delaware are LLC’s
• More LLC’s are formed in Delaware than any other state.
• Costs less than other states
• The flexible statutes allow you to create a custom operating agreement (or use our 30 page agreement as your own) that allows for maximum protection and minimum maintanence.

form company quickly, effiecently and effectively

WHO IS THE REGISTERED AGENT?

We will serve as the registered agent for your company, which means that if your company is ever served legal documents – we are there 24/7 to recieve these documents. The state of Delaware requires this.

BUT CAN I USE A DELAWARE LLC FOR MY BUSINESS IN A DIFFERENT STATE?

• YES!

BUT CAN I USE A DELAWARE LLC FOR MY BUSINESS IN ANOTHER COUNTRY?

• YES, many people choose this route because of the clear laws in delaware and the reliable, established court system of the United States of America

The U.S. Constitution GAURUNTEES that you can use a Delaware LLC wherever your business is located. The Delaware LLC laws provide MORE PROTECTION than ANY other state LLC.

YOU GET ALL THIS FOR THE LOW LOW PRICE OF ONLY $299

This Includes:

• MONEY BACK GUARUNTEE.
• Name Search
LLC Certificate of Formation
• $99 State Filing Fee Registered Agent Service until January 2012 ($99) annually thereafter)
• Priority Mail Delivery
• Professionally-Prepared 40 page LLC Operating Agreement, ready-for-signature

ITS SO EASY YOU DON’T NEED TO THINK –  just fill out the easy to use form on the website with the name of your company (and 2 backups in case they are taken) pay through paypal or googlecheckout, and the rest is taken care of, allowing you to sleep knowing your business, your family and your financial future is SAFE and SECURE.

————-SIGN UP NOW————

act now, before its too late…

Quick Overview

• For asset protection purposes: A LLC is a private entity established mostly for the purpose of creating a degree of separation between the debts, obligations and liability of the owners and the debts, obligations and liability of the business LLC.
• LLC’s are very flexible and have a vast array of uses.
• They are quite effective for property ownership.
• Relatively easy and inexpensive to set up.
• Creates a corporate veil between owners and company.
• LLC’s have many tax options.
• Has “outside and inside” protection.
• Several drawbacks to consider regarding single member LLC’s as opposed to multiple party LLC’s.

BENEFITS

Limited Liability

• The biggest benefit of an LLC is that all owners of a LLC are protected by corporate veil from being personally liable for the debts, and lawsuits of the LLC.
• Any LLC is its own separate entity. This means that any LLC is basically a legal person separate and apart from its owners. This is also important to note from a business continuity perspective. If a member, manager or a key employee dies or leaves the business, the business still continues.

Management Structuring

• A LLC creates flexibility when deciding how a business will be managed. The members of a limited liability company can choose between two simple management structures: management by members or management by designated manager.
• This benefit of an LLC allows members great elasticity in deciding the rules and bylaws with regards to the LLC management and governance.
• LLC laws intentionally impose very few formalities when it comes to limited liability company decision-making among members and managers.  This provides great benefits of an LLC because the owners can concentrate more on operating the business than worrying about formalities or upkeep.  Regardless, some limited liability company maintenance is recommended or required to retain the limited liability benefits of an LLC.
• LLC laws are focused on creating the ability for contractual flexibility.  LLC’s are designed so they allow members themselves to decide on important issues such as: ownership structure, right to profits, voting rights and many other aspects of the member relationships between both each other and with the limited liability company itself.  This allows an LLC to be used for many different types of businesses. LLC’s can be very simple or extremely complex, and cab be tailored to each individual situation.

TAXES

• The tax choices for an LLC are very advantageous. The IRS passed a regulation which cause the limited liability company to become a popular business vehicle for small business. “Check the Box” regulations, allow the members of the LLC to choose how the LLC will be taxed for federal income tax purposes.
• For a single member LLC that is owned by an individual, the limited liability company can have simple sole proprietorship federal income taxation but without the personal liability of sole proprietorships. Sometimes single member LLC’s can be owned by other entities- (If a C-Corp was the only owner of an LLC) in this situation, the tax choices afford the business freedom from complex consolidated return regulations.
• For multi-member LLC’s, laws allow partnership pass-through taxation. This is useful in that the limited liability company doesn’t to comply with many complex rules normally imposed upon a corporation that utilizes pass through taxation. Additionally, both a single member and multi-member LLC can each choose to be taxed as a corporation. The tax benefits of an LLC often provide more choices than other legal entities.

Important to note:

1. Always register your LLC in a state that only allows creditors a charging order as the sole remedy by statute.
2. If it is important, make sure you register in a state that allows anonymous managers, or use a nominee manager.
3. Make sure you have a well formulated and thought-out operating agreement in writing.

Courts have continually ruled that there is a distinction between an LLC and the owner of the LLC – and that the owners are insulated from the debts of the company.

You can register your business in an LLC in any state, and you would be wise to do so in a state that provides you with the most rights. Some of the most popular States for LLC’s are Wyoming, Delaware and Nevada. This is because the case law in these states is well developed.

Weaknesses

Be aware, that courts can pierce the corporate veil of LLC’s when fraud or falsification is involved, or under certain situations where the owner uses the company as an “alter ego.”

SINGLE MEMBER LLC’s – are an interesting topic. Many recent court cases have weakened the effectiveness of single member LLC’s.

LLC charging order protections MAY not apply to a single member LLC. A 2003 Federal bankruptcy court case (in Re Albright – Albright court case) ruled that LLC charging orders don’t apply to single member LLC’s. Furthermore, The Florida Supreme Court has ruled that Florida’s LLC laws do not provide asset protection to a single-member limited liability company.
They held that: ”a court may order a judgment debtor to surrender all right, title, and interest in the debtor’s single-member LLC to satisfy an outstanding judgment”

This court case does not apply to every instance of single member LLC’s. There simply is not enough case law at this time. Be aware that other state LLC’s carry considerably better established case law, and that courts have consistently ruled that multiple member LLC’s are protected. Most recently in Dover Phila Heating v. SJS Restaurants 185 Ohio App.3d 107, 2009-Ohio-6187.

Vodafone is a UK company, and Hutchinson Tellecon International was registered in Hong Kong. To complete the transaction Vodafone’s Dutch subsidiary purchased  a company in the Cayman islands that was controlled by Hutchinson. Indian tax officals claim the cayman islands firm was just a shell, and that Vodafone is should be forced to pay the captial gains taxes that were owed by the other company.

In its transaction, Vodafone acquired 52% from Hutchison by way of the  Cayman Islands entity while another  15% that was acquired from two owners who were located in India.

The court order says parts of the transaction for which any Indian link is established can be taxed by India. The court leaves the decision of tax liability in the hands of the Indian tax assessing officer, who at this point has not assigned a value to the tax liability of Vodafone.

“The Court was of the view that the transaction was a composite one and the department will have to assess the specific part of the income that had sufficient nexus with the territory of India. Therefore, the sale of shares of the offshore entity may not per se be taxable in India,” said Nishith Desai, acting on Vodafone’s behalf. Mr. Desai would obviously argue that the company had only a 15% of its ownership stake located within India, and only that portion of the transaction is taxable.

On the other hand,  the tax assessor can argue that the entire underlying assets of the company were located within India,  it has jurisdiction on all of it.

This transaction may cause concern for anyone considering major business deals with Indian corporations, and could well impact many past and future Indian business transactions – Foster’s Group Lltd. which was acquired by SABMiller PLC in 2006 is a $120 million deal that was conducted completely offshore. However ‘offshore’ the transaction may have been, Indian tax officals say some insian assets were transferred, and India is entitled to taxes.

Buyer beware, it is very unclear if offshore entities provide any shield from Indian tax collection. Many countries have legislation provisions known as “look-through” where a tax is imposed on gains from transfer of shares located outside the of the country if the transfer results in the passing control of a company that holds assets in the country.

This type of move by the Indian Tax authorities will benefit the country in the short run (by generating $2.6 billion in tax revenue) but could be hugely detrimental to foreign investment prospects in Indian in the future.

Intellectual property is anything that is a creation of the mind: inventions, literary or artistic works, symbols, names, images, drawings, musical compositions etc. It is intangible property, and is the result of creativity which is protected by patents, trademarks, copyrights or other legal protection devices.

Intellectual property is distinguishable from tangible property because tangible property is attached to the legal ownership of a physical item, wheras intellectual property is attacted to the expression of the idea behind that item. The purchase of a CD buys ownership of the CD, but not the underlying content or copyright in the CD’s content.

Intellectual property also includes:

Protecting one’s intellectual property is an important process, one that is fairly simple if properly executed. Once you have registered your intellectual property in the form of a copyright, trademark, slogan-mark, patent etc. you have effectively prevented others from stealing your idea or at least have further legal recourse should they ignore a notice to cease and desist.

Listed below are some resources to learn more about intellectual property, or register intellectual property.

onlinepatentapplication.info

www.intelproplaw.com

United States Intellectual Property

www.copyright.gov

United States Patent and Trademark Office

International Intellectual Property

www.wipo.int/classifications/en

Compiled List of European Countries

European Patent Office

Asian Patent Alliance

Compiled List of Law Firms

Anyone who has even a small amount of investment experiance has certianly learned that diversification is a very important goal. The idea being that when assets are diversified, risk is also reduced, because if one portion of the portfolio fails, the others will suceeed. Many people might think they have a balanced portfolio if it includes a 401K, mutual funds, stocks, bonds and perhaps some gold or other commodity.

The problem is that most people, however, have all of thier investments located:

1. In their home country.

2. In one currency.

Lets take a hypothetical example to demonstrate the dangers of an exclusively-domestic investment strategy.

Let’s say you live in the country of Bergistan.

Assume that this country “Bergistan” is floating along just fine, until one stretch where it is repeatedly attacked by terrorists on an almost daily occurance. Schools are shut down for months at a time, panic stricken individuals quit thier jobs and don’t leave thier homes, those who can escape (the rich) flee to safer locales. The economy grinds to a halt.

International investment all but stops, foreigners cease buying thier bonds and demand repayments of debt. Unemployment skyrockets, riots ensue, businesses close, the Begistan stock market crashes. The future of Bergistan is grim indeed. Futhermore, the Bergistinian national currancy, which was once thriving in the global economy, becomes worthless. Anyone living in Bergistan, who thought they had a well diversified portfolio of Bergistan Stocks, Bergistan Bonds and Bergistan currency realizes thier assets are now worthless.

This is an extreme example, but it nonetheless exemplfies the inherent danger of putting all your “eggs in one basket”, or investments in one currency.

Diversification into foreign markets can be risky, but the opportunities can provide you with wealth you never before thought possible.

By utilizing an advised, thought-out, and well constructed international investment strategy, an investor can potentially mitigate the aforementioned risks, as well as use arbitrage, timing, and prior investment knowledge to generate high rates of return.

This picture is a to scale diagram of what the debt would look like in 100$ bills loaded on pallets. It is sourced here. Yes, that's a person in the lower right.

The US has over 13 trillion dollars in national debt.

Stop for just one moment and think about that number. It is such a large number it is almost impossible to fathom. 13x 1,000,000 x 1,000,000

Just one trillion dollar bills laid end-to-end would stretch all the way from the earth to the sun … and then back again.

The National government deficit (the difference between the amount the government spends and the amount it takes in, per year) for 2009 was a record-breaking $1.4 trillion and estimates suggest that 2010’s budget deficit will be $1.5 trillion.

Many countries around the world have a problem with spending, but the sub-prime mortage crisis and subsequent measures taken by the US government should demonstrate that there is a deep seeded problem with debt in the United States.

Almost every level of the United States has a problem with spending money it doesn’t have, which has fostered a mentality of buy now and pay later. This article is meant to show a very brief overview of the US national debt, and examine future implications involving its largest creditor, China, of which the US owes more than 800 billion USD.

As of June 1, 2010, the debt was valued at approximately 89% of the US gross domestic product, and for the first time exceeded $13 trillion. The annual government deficit or surplus is calculated by subtracting the difference between the money the government takes in, and the amont that the government spends or gives away.

The gross debt increases or decreases as a result of this unified budget deficit or surplus. However, there is certain spending (supplemental appropriations) that add to the gross debt but are excluded from the deficit. The total debt has increased over $500 billion every single year since 2003, with increases of $1 trillion in 2008 and $1.9 trillion in 2009. As the US gets into deeper amounts of debt, they increase spending, take more loans, and raise taxes. This is not the right way to get out of a recession.

Source

Check out this chart sourced from Wikipedia. As you can clearly see, the debt crisis is not a new phenomenon.

However, events such as the Iraq and Afghanistan Wars have pushed the debt to unprecedented levels.

U.S. policy-makers should consider the geopolitical and national security implications of operating a fiscal policy that depends on China and other foreign creditors, who collectively hold 50 percent of U.S. publicly held debt. If they decide to stop buying bonds, the US dollar could collapse. Although this is not likely, and it could cause a systemic economic collapse, there is a chance that faith in the almighty dollar is, or could someday be, significantly deteriorated.

See what some other sources have to say about the issue:

Maj. Gen. Luo Yuan told China’s state-run Outlook Weekly magazine last month, shortly after the U.S. detailed new arms sales to Taiwan,  that China’s “retaliation should not be restricted to merely military matters” but also should be “covering politics, military affairs, diplomacy and economics.”

“We could sanction them using economic means, such as dumping some U.S. government bonds,” Gen. Luo said.

Michael Wessel, a member of the U.S.-China commission, began the hearing by noting that China, whose economy expanded by 10.7 percent during 2009, “emerged from the global recession stronger than ever, expecting its status as America’s banker to convey new political power.”

“The United States government, with its fiscal and monetary tools constrained by the recession, cannot easily extricate itself from its growing financial dependence on China,” he said.

China and the US are inextricably tied financially through debt. It is in China’s best interest that the US dollar remains strong, and the Yaun stays devalued. Its pretty much accepted at this point by most economists that Chians Yuan is 30-40 percent undervalued. This is partially because the Chinese central bank purchases massive amounts of USD in order to peg the yuans value to the dollar at a much lower level, thus allowing for the debt owed to be larger than it would be if the dollar became devalued in respect to the yuan.

Its easier to think of in this way:

The debt is at a fixed amount of dollars, to be paid at a later date. So if the US dollar is worth more, China (or other debt holder) gets paid more. If the dollar is worth less, China gets paid less.

Any way you cut it, the United States owes a tremendous amount of money. This will carry large implications into the future of economic stability not just for the US, but for the entire world. It is unclear at this point what those implications might be, but if you are able to predict correctly and invest strategically, there certainly will be money to be made.

]]> http://assetprotectionworldwide.com/economics/money/brief-national-debt-history-future-implications-with-china/feed/ 0 http://assetprotectionworldwide.com/uncategorized/in-the-news-death-tax/ http://assetprotectionworldwide.com/uncategorized/in-the-news-death-tax/#comments Fri, 23 Jul 2010 18:22:28 +0000 Edmund J http://assetprotectionworldwide.com/?p=259 After a brief hiatus, the death tax is back. article source

Republicans failed in a last ditch effort to repeal the Estate Tax. The aptly named ”death tax” which has been declining since the year 2001, and is not in effect in the year 2010, is going to be reset to pre 2001 levels. This tax is a double tax. It is a tax on a deceased American citizen’s estate. A tax on assets that the decedent has been paying in state, local, municipal, social security and healthcare (among other) taxes on for their entire life. What happens when they die? For estates worth more than 3 million USD, “Uncle Sam” is entitled to more than half, or 55%.

Senator Jim Demint (R) tried to eliminate the tax by creating an amendment in the Small Business Jobs bill. The proposal failed, despite several democrats having signed on. Demint suggests that “Washington could get over half of family estates, farms and small businesses, a greater inheritance than the children of the deceased.” In essence, you could work your whole life building wealth, only to have half of it stripped away from your heirs due to taxes.

Furthermore, analysis by prominent figures in the tax and budget (sections) found that if the US government permanently repealed the death tax, it could create 1.5 million jobs. In a day and time where the government is struggling to create jobs, and boost the economy, and lower the debt, will overtaxing their citizens accomplish the exact opposite?’

Republicans are not the only political party opposed to a death tax. Democrats have also suggested some solutions. In the past, it was suggested that the death tax apply at USD3.5m for an individual (USD7m for a married couple) and the maximum tax rate of 45%. This change was approved by the House of Representatives but was never voted on by the senate.
Contrast this to the British inheritance tax, where estates valued as less than 325,000 GBP pay nothing, and estates over this amount owe 40%–a vastly smaller amount that what is being imposed across the pond in America.
It’s clear that the US has amassed tremendous amounts of debt, and the deficit is growing to epic proportions each year. Most see the solution to this problem in one of two avenues: increase taxes, or decrease spending. However, when will the tipping point come where rich Americans say enough is enough, and take their residency and hard earned cash elsewhere? The government may ultimately end up losing out.

Opponents to this argument would argue that Americans are here to stay no matter what, and renouncing one’s citizenship would be unconscionable. However, 743 US citizens renounced their citizenship in 2009, contrast that number to 235 renunciations in 2008. source

One might wonder where the tipping point is where the government taxes the affluent and rich to an extent that they say “no more taxes” and up and leave to a low tax country without excessive amounts of debt to pay back. Perhaps this is not the forecast, but one thing is for sure; the US government (and state governments for that matter) need to cut spending or increase taxes, two things that most politicians or taxpayers will never support.

8 Steps to forming a corporation.

If you’ve looked through the list of corporate structures and have decided that you want to start a corporation in the US, here are the steps you should take:

1. Choose a business name that complies with your state’s corporation rules.

• The name cannot be the same as the name of another corporation on file with the corporation’s office.
• The name must end with a corporate designator, such as “Corporation,” “Incorporated,” “Limited,” or an abbreviation of one of these words (Corp., Inc., or Ltd.).
• The name cannot contain certain words that suggest an association with the federal government or any restricted type of business, such as: Bank, Cooperative, United States, Federal, National.
• Perform due diligence to ensure the name won’t violate another company’s trademark.

2. Appoint the initial directors of your corporation.

• Directors will be making the major policy and financial decisions for the corporation. Some of the items on their agenda for the directors should be to issue stock, appoint officers, and approve loans. Often, the owners simply appoint themselves to be the directors, although directors do not have to be owners.
• Most states only allow a corporation to have one director, regardless of the number of owners. Whereas in other states the number of directors will correspond to the number of owners.

3. File formal paperwork, which are usually referred to as “articles of incorporation”.

• This will usually include paying a filing fee ranging from $100 to $1000, depending on the state where you incorporate. Look for a state that is best for your corporation based on a number of factors.
• Prepare and file “articles of incorporation” with your state’s corporate filing office, which is most likely at the secretary of state’s office, located in your state’s capital.
• No state requires a corporation to have more than one owner. With a single-owner corporations, the sole owner would prepare, sign, and file the articles of incorporation. Co-owned corporations, could have the owners each all sign the articles or delegate one person to sign.
• Articles of incorporation are mostly a formality, they don’t have to be extensive or complicated. You can even prepare articles of incorporation by filling out a form provided by the state’s corporate filing office.
• They  will include details such as the name, office address and names of directors in some instances.
• Most likely one of the directors will serve as a ‘registered agent’ or ‘agent for service of process’ so that there is a person on file for the public to contact, for lawsuits and otherwise.

4. Create corporate “bylaws,” which lay out the operating rules for your   corporation.

• Bylaws are the internal rules that govern the day-to-day operations of a corporation,
• When and where the directors’ and shareholders’ meetings will take place and the extent of the shareholders’ and directors’ voting rights and requirements.
• When creating bylaws it might be advisable to hire a lawyer to draft them for you. The bylaws can then adopted by the corporation’s directors at their first board meeting.

5. Create a shareholders’ agreement.

• This agreement can regulate many different aspects of the corporation. It is particularly useful for small business owners to decide and plan what happens when an owner retires dies or leaves the corporation for another reason.
• Some other items to include in a shareholders agreement could be voting rights, share split, intellectual property rights, anything that there should be an agreed upon now rather than later.

6. Hold the first meeting of the board of directors.

• At this meeting, many different things need to be accomplished. First and foremost the company should:
  • Select corporate officers
  • Approve the corporate bylaws
  • Authorize the issuance of shares of stock,
  • Implement an official stock certificate form and corporate seal.
  • If the corporation will be an S corporation, the directors should approve the election of S corporation status. S Corps allow for pass-through taxation, but are somewhat limiting as to the amount of stock and shareholders the company can have.

7. Issue stock certificates to the shareholders of the company.

• It is important that you don’t conduct official business before you issue stock.
• When you issue stock shares, you are formally dividing up ownership interests in the business.
• This is a requirement of doing business as a corporation
• Issuing stock can be complex because it must be accomplished in accordance with securities laws.
• Large corporations must register their stock offerings with the federal Securities and Exchange Commission (SEC) and the state securities agency. Registration takes time and typically involves extra legal and accounting fees.
• If you are a small corporations, you may qualify for exemptions from securities registration. Consult a professional to see if you qualify, as state by state requirements are often different.
• if your corporation is issuing stock shares to a small number of people (generally ten or less) who will actively participate in running the business, it will certainly qualify for exemptions to securities registration.

8. Obtain any licenses and permits that are mandatory for your business.

• This will vary greatly on the type of business you are trying to run.
• Most likely you will need a business license, which is also known as a tax registration certificate.
• You may also have to obtain an employer identification number from the IRS, a seller’s permit from your state, or a zoning permit from your local planning board.

China is going to build an 8 billion dollar oil refinery in Nigeria. It is the first of 3 refineries that comprise a $23bn agreement between NNPC and CSCEC. Nigeria’s state oil company, NNPC, will cover 20% of the cost while the state of Lagos will provide the land.  The China State Construction Engineering Corporation, CSCEC, will cover the additional 80% of the cost. Nigeria already has 4 oil refineries but they are run very poorly and are estimated to be operating at only 40% capacity. Due to this inefficiency, Nigeria has to import some refined oil. original article from bbc.com

China’s dependence on energy  (especially in the form of fossil fuels) is increasing dramatically and will continue in a strong upward trend. New power plants will be built, and more energy will be expended. One of the most obvious indicators of the trend for increased fuel demand is the automobile market.

In the past year, China’s car market expanded by almost 40%. Contrast that to the U.S. where new car sales plunged more than 20 percent in 2009 to a 27-year low of 10.43 million vehicles, less than the 12.23 million sold in China during January-November, making the Asian giant the world’s largest car market for the first time. Since the year 2002, about 50% of all motor vehicles in China have been purchased by individuals instead of large corporations or the government previously. As incomes increase, the high annual growth rate of private ownership is expected to accelerate. A new generation of young adults is emerging in China. This generation demands higher wages, better working conditions, and new material possessions.

However the Chinese government is taking steps to slow inflation, curb overspending, and control the economy. China’s economy expanded 11.9 percent in the first quarter. China International Capital Corp. has said that it expects growth to slow to 7.5 percent by the fourth quarter. Source

More cars mean more fossil fuels. Therefore along with this comes an increased demand for energy, particularly in the form of fossil fuels, which is still the cheapest form of energy available. Moreover it appears the Chinese government is taking steps to obtain that oil independently, even if that means teaming up with Nigeria.