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US Chamber China Trade & Investment News
June 06, 2008
Trade
June 06: China's automobile export was up 69.46 percent from 2007 to 71,000 units in April 2008, hitting an all-time high of exporting over 70,000 vehicles within a month, according to China Association of Automobile Manufacturers. In April, China imported 37,700 units, down 7.19 percent month-on-month but up 58.68 percent over the corresponding period in 2007. The total import and export value amounted to $5.1 billion and $15.78 billion respectively in the first four months of 2008, up 88.29 percent and 41.26 percent from the same period in 2007.
China Knowledge
June 06: China's passenger-car sales grew faster-than-expected 16 percent in May 2008, as demand spurred by economic growth withstood the effects of the country's deadliest earthquake in 32 years. Sales of passenger cars, multipurpose vehicles and sport utility vehicles increased to 564,600 in May 2008 according to the China Association of Automobile Manufacturers.
Bloomberg
June 05: China will become a net grain importer due to the country's limited capacity to expand grain supplies. According to China's Ministry of Commerce, "We should realize that tight grain supplies in China will be a common phenomena in the future. In the mid or long term, we will become a net grain importing country." Rapid economic growth has fuelled strong demand growth for grain, but production disruptions caused by climate change and natural disasters, as well as falling inventories, have caused global grain prices to rise as supplies tighten.
Resource Investor
June 05: The international ratings agency Fitch predicted that the appreciation of Chinese RMB currency would slow down in the remaining months of 2008; and China will face mounting pressure from the US and EU on this issue. Pressure on exports and the intention to curtail Yuan's speculation are two reasons supporting that prediction, according to a statement by James McCormack, managing director of Sovereign Ratings Asia Pacific, at Fitch's Global Banking Conference in Beijing.
People's Daily Online
Political and International News
June 06: US to host SED with China in Annapolis June 17-18.
China Trade Extra
June 06: EU report finds product safety requires development, production process supervision.
China Trade Extra
June 06: China has taken steps to tackle toy safety concerns after a string of recalls in 2007, but authorities should tighten supervision of the sector further according to an independent report commissioned by the EU. The European Commission at one point in 2007 threatened to ban toy imports from China after millions of toys had to be recalled because of excessive levels of lead paint and other unsafe components. "Chinese enforcement authorities should continue to strengthen the supervision efforts vis-a-vis the Chinese toy industry, especially focusing on the weaker manufacturers," the report by independent experts concluded.
The New York Times
June 06: The first Finland-China-Russia Economic Forum will be held in the Finnish capital of Helsinki in October 2008. The two-day forum, which will begin on October 30 2008, will focus on forestry, energy, environment, transportation and logistics to improve dialog among the three countries on the development of commercial and financial cooperation and investment.
People's Daily Online
June 06: Although many of the regulations concerning registration of foreign visitors to China have been in place for decades, the actual enforcement of these often-draconian measures now being employed has not been seen in China since the late 1980s. This, compounded by seemingly erratic treatment of business visa applications and coupled with occasional bureaucratic entrepreneurial activities, has meant that the Beijing Olympics are becoming far less likely to be a truly global event and far more a Chinese celebration.
China Briefing
June 06: Chinese Assistant Finance Minister Zhu Guangyao called for a strong US dollar and reiterated that Yuan reform is in China's own interest. A strong dollar is in the interest of the US, Zhu said at a media briefing ahead of the Sino-U.S. Strategic Economic Dialogue, scheduled for June 17 and June 18 2008 at the US Naval Academy in Annapolis, Maryland. Zhu reiterated that China would reform its local currency in a gradual and controllable way.
The Wall Street Journal; Bloomberg
June 05: China's foreign minister said relations with India are at an all-time high as he met with his Indian counterpart amid concerns in New Delhi about Beijing's growing influence and alleged incursions along their disputed border. Foreign Minister Yang Jiechi told his visiting Indian counterpart Pranab Mukherjee that trade and diplomatic ties would keep improving with cooperation between the two countries, whose combined populations make up a third of humanity.
The Wall Street Journal; Washington Post; The New York Times
June 05: China's Vice President will visit North Korea in June 2008 in his first foreign trip since taking office in March 2008, underscoring close ties between the countries. Xi Jinping will travel to North Korea and meet with top officials. North Korea's nuclear program is likely to be discussed during the visit. Six-nation talks on North Korea's nuclear disarmament have stalled since it missed a deadline in 2007 to submit a list of all its nuclear programs.
The Wall Street Journal
National People's Congress
June 06: Chinese President, Hu Jintao, has appointed seven new ambassadors in accordance with the decisions adopted by the Standing Committee of the National People's Congress, China's top legislature.
China.Org
June 06: The Public Security Bureau (PSB) issued new guidelines to hotels and apartment management companies concerning registration of foreigners in China, set to take effect on July 01, 2008. The PSB, a part of China’s domestic police force charged with policing public security and immigration residence registration and immigration affairs for foreigners, has insisted that the existing regulations for registration of foreigners in China must be strictly adhered. Violators and those who fail to report, be they individuals or building management, will be subject to fines.
China Briefing
Economy
June 06: The recent earthquake's impact on China's economy will be temporary, and the country's economy will not suffer a "hard landing" as feared by some economists, according to the People's Bank of China. Although soaring demand for some commodities after the devastating earthquake in May 2008 will add to the inflationary pressure, the impact of the earthquake on the consumer prices index is temporary, and the influence will not last in the long- run. The fixed-asset investment in the quake-hit area is expected to increase due to the large-scale reconstruction.
China Knowledge
June 06: China's fiscal revenue was $325.7 billions in the first four months of 2008, up 29.4 percent year-on-year. April 2008 revenue jumped 17 percent year-on-year to $98.6 billion. The growth rate in April was down 7.7 percentage points from March as weaker profits cut corporate income tax payments. It said corporate income tax revenue, which accounted for 17.1 percent of 2007 fiscal revenue, was down 11.9 percent year-on-year in April and 11.7 percent from March.
Xinhua
June 05: Chen Donqi, vice president of the Academy of Macroeconomic Research (research arm of the NDRC), has warned that China needs to take steps to avert the risk of a sharp economic slowdown, including “pro-active” fiscal policies such as reductions in corporate and personal taxes.
Sampa
Foreign Investments
June 06: China's foreign-exchange regulator reiterated its intention to more closely monitor cross-border capital flows after the country's capital-account surplus grew sharply in 2007. China's current-account surplus widened by nearly half to $371.8 billion in 2007, from $249.9 billion in 2006. The capital-and-financial account surplus soared to $73.5 billion in 2007, from $10 billion in 2006. The regulator said China's balance-of-payments surplus would likely remain high in 2008.
The Wall Street Journal; The Wall Street Journal
June 06: China's Shanghai Gold Exchange granted three foreign banks membership, marking an important step in opening its bullion market to foreign institutions. The exchange said it approved membership for the Guangzhou branch of Bank of Nova Scotia. In February 2008, exchange Chairman Shen Xiangrong said Standard Chartered Bank (China) Limited and HSBC China had got approvals, though no formal statement was issued.
The Wall Street Journal
June 06: Chinese apparel and supply chain services company Hembly International's chairman will announce that he has acquired Italian sportswear maker Sergio Tacchini in a deal that could presage further acquisitions of storied Italian fashion brands by Asian buyers. Observers say that this landmark deal is a sign that Chinese businesses are poised to buy Western companies and develop them in the fast-growing retail market in Asia.
The Wall Street Journal
June 05: China has been ranked the most attractive destination for foreign direct investment (FDI), ahead of Eastern Europe and Western Europe, according to a survey of business leaders released by Ernst & Young.
People's Daily Online
Food/Consumer Product Safety Issues
June 06: China will shut down small dairy makers and lift the threshold of new market players as part of its tightened supervision to prompt the dairy industry's healthy development and global competitiveness. Small dairy manufacturers with backward technologies and high-energy consumption will be eliminated. The industry-wide reshuffle is expected to lead to 2.5 million tons of dairy production to be cut by 2010 and an estimated 6 million tons to be reduced by 2012.
Market Avenue
Energy & Environment
June 06: China Petroleum & Chemical Corporation targets annual gas capacity from a new Sichuan field of as much as 2 billion cubic meters by 2010, equivalent to more than a fifth of the company's projected gas production for 2008. Sinopec, as China's second-largest oil company is known, plans to develop the Dayi field in 2009 according to the parent China Petrochemical Corporation. Dayi, near the cities of Dujiangyan and Pengzhou, will bolster fuel supplies to an area recovering from the most powerful earthquake to hit China in 58 years.
Market Avenue
June 06: Chery Automobile Company Limited, one of the Chinese homegrown automakers, said that it would set up a central research institute to boost the research on new energy technologies. The new central research institute will mainly focus on the study of new energy sources, new technologies, new materials and trial productions of experimental technique. The company has already established a hybrid-power research and emulation platform for the development of complete hybrid car.
China Knowledge
June 06: Pressured by nationwide fuel shortages, China's main refineries are raising crude runs to maximum capacity and delaying or shortening maintenance programs to minimize impact of outages, even if this slightly increases safety risks. Refiners in China, the world's second largest oil consumer, are also boosting imports of oil products and crude to supplement insufficient domestic supplies.
The Wall street Journal
June 06: Shenhua Group Corporation, China's largest coal producer, increased production of the fuel by 17 percent in May 2008 as the government ordered mines to boost supplies and end electricity shortages.
Bloomberg
Insurance & Finance
June 06: Shanghai Pudong Development Bank, partly owned by Citigroup Inc, plans to expand its retail outlets to 1,000 in the next few years, more than double from the current 400. The Shanghai-based mid-size lender, with a focus on businesses in the Shanghai area, plans to expand to South China's Guangzhou and Shenzhen and North China's Beijing and Tianjin, in a bid to enhance its presence and boost earnings.
China Knowledge
June 06: Little Sheep Group Limited, a homegrown lamb hotpot chain in China, has raised about $100 million in its IPO in Hong Kong. The Inner Mongolia-headquartered company eventually issued 245.2 million shares. Proceeds will be primarily used for business expansion, including a plan to set up at least 40 new company-owned restaurants in major Chinese cities.
China Knowledge
June 06: Jiangnan Shipyard, a subsidiary of China State Shipbuilding Corporation (CSSC), has moved to Shanghai's Changxing Island, the mouth of the Yangtze River. It plans to invest $2.3 billion to build a new shipbuilding base equipped with the nation's most advanced shipbuilding facilities and technology. The first-stage construction of a new shipbuilding base has been completed.
China Knowledge
June 06: China's Sinosteel Corporation said it has increased its stake in Midwest Corporation to 40 percent, as it pursues its takeover of the Australian miner. The rise increases Sinosteel's chances of spoiling a rival bid for Midwest from Murchison Metals Limited. The state-owned Chinese company raised its stake in Midwest to 40.09 percent, or more than 85.4 million shares, from 33.82 percent.
The New York Times
June 06: Beijing North Star Company Limited announced that it has gained approval from China Securities Regulatory Commission to issue bonds. North Star will issue no more than $245.5 billion bonds with the duration of at least 3 years. The company said in October 2007 that the earnings from the bond issuance would be used for repaying bank loans and reinforcing its operation capital.
China Knowledge
June 06: China's banking regulator has told China Minsheng Bank Corporation to stop offering foreign-exchange margin trading services to new clients. The China Banking Regulatory Commission told the bank not to open any new accounts, but that existing accounts could continue to operate. Currency traders said the instruction from the regulator was motivated by government concerns that the banks' internal risk controls aren't sufficiently developed to offer leveraged products.
The Wall Street Journal
June 06: Agricultural Development Bank of China said it plans to sell $1.4 billion worth of five-year floating-rate bonds. The bonds' reference rate will be the one-year deposit rate, which is now 4.14 percent. It will sell the bonds on the interbank market.
The Wall Street Journal
June 06: London-based Standard Chartered announced that its transaction of 2007 jumped 80 percent in China, quintupled the lender's average growth in other countries. The bank plans to increase its outlets by 60 percent in 2008 in the world's fastest-growing major economy, thus the number of its branches and sub-branches will reach 60 by then, according to Peter Sands CEO of Standard Chartered.
China Knowledge
June 06: China's Ministry of Finance said it sold $3.9 billion worth of one-year bills at 3.42 percent. The yield was in line with market expectations for a rate between 3.40 percent and 3.45 percent. The bills will be traded on the interbank bond market and on the Shanghai Stock Exchange from June 16, 2008.
The Wall Street Journal
June 06: China's banking regulator has asked banks and credit cooperatives to ensure credit to grain producers and agricultural firms, in a move to spur grain production and aid reconstruction efforts of production areas in earthquake-hit Sichuan province. Commercial banks should grant more loans and credit to support grain production as grain supply pressure continues to soar in China, according to Zang Jingfan, director of cooperative finance supervision department of the China Banking Regulatory Commission (CBRC).
People's Daily Online
June 06: The Agricultural Development Bank of China (ADBC) said it has opened an all-round cooperation with the country's Export and Credit Insurance Corporation (CECIC). The ADBC and the CECIC signed an agreement in Beijing that indicated the establishment of the cooperation between the country's policy-oriented bank and policy-oriented insurance company. According to the agreement, the two sides will share information resources, research and development products, as well as e-business.
People's Daily Online
June 06: China's national social-security fund has been cleared to invest as much as 10 percent of its assets in domestic private-equity funds, a move that frees up about $7.5 billion for deals. The pool of capital opened to the domestic private-equity industry will encourage more Chinese dealmakers to turn to onshore, Yuan-denominated funds. Global firms, such as Carlyle Group and TPG that have dominated the private-equity scene in China will face tougher competition for deals because domestic-currency funds face fewer regulatory hurdles.
The Wall Street Journal
June 06: China Vanke Company Limited announced on June 03 2008 that it would purchase more of its own shares worth of as much as $97.3 million. Vanke's incentive fund bought 11,533,195 A-shares in 2007 at an average price of $3 per share. The incentive fund of 2008 has already bought 37,804,258 shares at an average price of $2.91 per share.
Market Avenue
June 05: Bank of Hangzhou Company said its net profit rose 42 percent in 2007 on an increase in interest income. Net profit rose to $122.3 million from $86 million in 2006. Bank of Hangzhou's interest income rose 34.7 percent in 2007 to $4.9 billion, from $364 million in 2006.
The Wall Street Journal
June 05: Shanghai International Port (Group) Company said it will auction $217 million worth of three-year bonds on the inter bank market June 16 2008. The port, mainland China's largest by throughput, said it would use the proceeds from the bond sale to repay short-term loans and supplement working capital. Bank of China Limited will be the issue's main underwriter.
The Wall Street Journal
June 05: China is putting in place legal structures that enable foreign funds to operate as Yuan-denominated onshore entities as opposed to making investments through an offshore holding company. China is also trying to develop domestic private equity funds. Chinese pension fund will be allowed to invest in private equity. China is to launch new exchange to make it easier for smaller enterprises to access capital.
Resource Investor
June 05: Livzon Pharmaceutical Group, one of the leading pharmaceutical companies in China, plans to repurchase as much as $20.5 million worth of HK dollar-denominated B shares, according to the company's announcement. Livzon plans to buy back 10 million B shares, accounting for 3.27 percent of its overall equity and 8.18 percent of its outstanding B shares, at a price no more than $2 per share.
Market Avenue
Internet
June 06: Baidu.Com Incorporation officially launched its instant message (IM) Hi system in Shanghai, one of "strategy" steps for China's biggest online search services provider to expand its online community. Baidu Hi is integrated with a Web page keyword search function, putting it alongside rival products such as MSN and QQ, according to Shen Haoyu, Baidu's vice president. Baidu has launched cyber games and online forum services and will have an online auction Website by the end of 2008.
Shanghai Daily
Defense & Exports Control
June 06: Chinese President Hu Jintao, also General Secretary of the Communist Party of China Central Committee and Chairman of the Central Military Commission, has approved regulations on the duty of soldier committees. Soldier committees of the People's Liberation Army (PLA) are responsible for carrying out grass-root activities, promoting military democracy and assisting Party branches. The regulations are aimed to ensure harmony and purity among soldiers' inner relationships and promote the army's scientific development.
Xinhua
General News
June 06: China's Ministry of Information Industry has published an announcement that it will cancel the license of 15 service providers offering trans-regional value-added services. The widespread spam short messages that are troubling Chinese mobile phone users may have something to do with the illegal service providers. MII will cancel these companies' service licenses according to the relevant clauses of China's Administration Permission Law.
China Tech News
June 06: China Telecom says it is working with four other Trans-Pacific Express Consortium team members to complete their latest project by the end of 2008. China Telecom Americas, the largest international subsidiary of China Telecom Limited, announced presale of the Trans-Pacific Express product to meet advanced applications and requirements. The cable, a $500 million investment of the consortium team, led by China Telecom, is 13,000 miles long and will carry 2.56 Terabits per second. The Trans-Pacific Express Cable is the first next-generation undersea optical cable system directly linking the United States and China.
China Tech News
June 06: Following the establishment of Commercial Aircraft Corporation of China Limited.(CACC), China's first jumbo passenger aircraft company, five main aircraft manufacturers have been selected to jointly develop jumbo jet planes with CACC. The five manufacturers are Harbin Aircraft Industry Group Company Limited, Shaanxi Aircraft Industry (Group) Company Limited, Xi'an Aircraft Industry (Group) Company Limited, Shenyang Aircraft Corporation and Chengdu Aircraft Industrial (Group) Company Limited.
China Knowledge
June 06: China's key rare earth material producers have said they will stop production for a month in a bid to stabilize market prices, which have dropped nearly 30 percent in 2008. Inner Mongolia Baotou Steel Rare Earth Hi-Tech Company, China's largest rare earth materials producer, announced on May 29 2008 that it would suspend the supply of rare earth concentrates and production of separation products for a month. Meanwhile, the Ganzhou Rare Earth Industry Association also said in a statement that it would suspend production for a month from June 01 2008.
The Wall Street Journal
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