It all depends on what kind of company (local or WFOE) you want to create.  As a rule of thumb, local companies have to invest about 1/10th of what a WFOE does.   But a local company needs to have a local person as the major share holder.

There are many joint ventures that have great histories and there are ones that have been a complete nightmare and total financial loss for the foreign partner.  You know your friend better than we do, so we can't tell you if he/she is trustworthy or not.

I always had very bad luck with partners in a business, so anything I may do will be with me as sole owner.  There is always the complain that one partner does not pulls his weight in sharing duties, responsibilities and work load.  Then, also the fact that 90 % of the time, the one working less wants the largest share of profits.  And some are so shortsighted than do not realize the need for a working capital and wish to have it as par of profits.  No, partners (Chinese or otherwise) are not in the picture for me.

Now, it is my impression that to register and open a Foreign own corporation in China you need at least 100,000 Rmb to deposit as capital.  Once the corporate status is granted, you will need whatever amount is required to establish, open and operate the business.  And when you open, you should have at least, the reserves for 6 months of no profits while building up a clientele.

So, depending on the inventory requirements and equipment needed, plus locale, to open whatever you have in mind, that will be your capital need.

Yes i agree with HappyExpat, a sole owner is better, but you may turn to your friend for help when you catch some problems. Also you can contact me for anything about company setup skype chingnic