Political and International News National People's Congress

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Political and International News

National People's Congress


Foreign Investments

Food/Consumer Product Safety Issues

Energy & Environment

Insurance & Finance

Science & Technology

General News

US Chamber China Trade & Investment News

October 14, 2008




October 14: China's trade surplus totaled $180.9 billion in the first nine months of 2008, down 2.6 percent or $4.92 billion year-on-year. In the Jan-Sep period, China's total trade volume rose 25.2 percent from 2007 to $1.967 trillion with exports and imports rising 22.3 percent and 29 percent to $1.074 trillion and $893.1 billion, respectively. In September alone, China's total trade volume went up 21.4 percent over the same period of 2007, to hit $243.5 billion.






October 14: The latest foreign trade figures show that China's imports of primary products sped up quickly and prices of those imports were high over the first nine months of 2008. China imported $294.2 billion of primary products from Jan-Sep, representing a sharp increase of 69.5 percent over the same period of 2008.



October 14: US trade deficit shrinks in August; China gap grows.



October 14: The rising yuan along with escalating production costs, drove half of China's toy exporters out of the market in the first seven months of 2008. A total of 3,631 toy exporters or 52.7 percent of the industry's businesses shut down in 2008. They were mainly small-sized toy producers with an export value of less than $100,000. Customs data showed 3,507 toy exporters still in business.



October 14: China, the world's biggest steel producer, said steel-product exports fell 13 percent in September to a three-month low as a global credit crunch and an economic slowdown curbed demand from automakers and builders. Exports fell to 6.67 million metric tons in September, from a record 7.68 million tons in August. That's still 50 percent higher than 2007.



October 14: Imports of copper and copper products by China, the world's largest consumer, rebounded in September after overseas prices slumped on concerns about a global slowdown, spurring purchases to meet steady domestic demand. Imports climbed 20 percent to 213,782 metric tons in September from August.



October 14: China, the world's second-largest energy user, increased crude oil imports by 10 percent in September to meet rising demand from refineries. Imports climbed to 15.03 million metric tons, or 3.66 million barrels a day, in September. The rate of increase compares with an 11.5 percent gain in August and a 7 percent decline in July.




Political and International News

October 14: China's defense minister has demanded that the US to cancel a $6.5 billion arms sale to Taiwan, saying it created "obstacles" in relations between Beijing and Washington. Liang Guanglie's remarks are the latest show of pique by Beijing over the arms package that includes Patriot III missiles, Apache helicopters, and parts for F-16 jet fighters.



October 14: ITC releases corrected version of Rangel request for textile monitoring.



October 14: Commercial officials of China and the Democratic People's Republic of Korea (DPRK) said to boost cooperation on economy and trade in an annual bilateral meeting held in Pyongyang. China will pragmatically push the bilateral economic and trade cooperation to a new high on the principle of being guided by the government and with the participation of businesses and market operations.



October 14: MOFCOM predicts continued decline in Steel, iron ore prices.



October 14: China and Russia held a ceremony at Heixiazi Island to unveil the boundary markers for eastern section of China-Russia boundary. Ambassador with the Chinese Foreign Ministry Zhao Xidi and Vladimir Malyshev, deputy director of the Russian Foreign Ministry First Asian Department jointly unveiled the boundary markers. Representatives from the two countries' departments of foreign affairs, national defense, public security and localities also attended the ceremony.



October 14: China and Singapore vowed to share their respective experiences on development and collaborate in more areas. Chinese Vice Premier Li Keqiang met with Singaporean Minister for Defence Teo Chee Hean in the central government compound Zhongnanhai in downtown Beijing. Li reviewed the sound bilateral relations since the two nations forged diplomatic ties in 1990, citing their fruitful cooperation in trade, investment, urban construction and environmental protection, among others.



October 14: Asif Ali Zardari, Pakistan’s president, on his first visit to Beijing as head of state, is expected to seek a soft loan of $500 million-$1.5 billion from the Chinese government to help him shore up a moribund economy beset by warnings of a possible debt default. The rupee sank to an all-time low last week and Standard & Poor’s, the global rating agency, downgraded the rating on Pakistan’s sovereign debt to triple C-plus.





October 14: China's broadest measure of money supply, M2, was up 15.29 percent at the end of September from 2007. The M2 growth rate was lower than the 16.0 percent rise at the end of August.



October 14:  China's consumer confidence index shrank slightly in the third quarter amid global financial turmoil. The index fell 0.3 points from the previous quarter to 93.8. The index was 3.2 points lower than the same period of 2007. The CCI, which measures consumers' opinions on employment, the economy, regular income, the stock market and quality of life, was released after the disclosure of a lower entrepreneurial confidence index and a lower business climate index, both year-on-year figures for the third quarter.



October 14: China appointed Vice Premier Wang Qishan to head a committee being formed to monitor the global financial crisis and adjust domestic fiscal policies accordingly. The committee is the latest attempt by the Chinese government to prevent its economy from following Western countries into recession. Wang's appointment as the committee's chairman could serve to streamline the information flow and decision-making processes, expediting the central government's responses to challenges.




Foreign Investments

October 14: China's foreign-exchange reserves rose to a world record $1.906 trillion, helping to strengthen the nation's finances as the credit crisis threatens to trigger a global economic slump. The People's Bank of China said currency holdings rose 32.9 percent at the end of September from 2007. The increase of about $97 billion over the quarter was down from a $126.6 billion gain in the previous three months.



October 14: The Bank of China would continue its strategic partnership with the Royal Bank of Scotland (RBS) which is hit hard by the financial crisis and will be partly nationalized. Holding 8.25 percent of BOC shares, RBS is the largest foreign shareholder of Bank of China.



October 14: HP has signed a memorandum of understanding with China's Chongqing Municipality to build a computer manufacturing plant, the company's second computer plant in China following the plant in Shanghai.



October 14: Hong Kong real estate company VXL Capital Limited said that Blackstone Group has not cancelled the deal to buy stake in a commercial building in Shanghai owned by the company. The property firm said in a statement that it is still working with the US equity firm to reschedule the closing date of the agreement by October 31.



October 14: Bank of America, the second largest commercial bank in the United States by deposits and market capitalization, said that it would keep most of the stake it holds in China Construction Bank. Bank of America is currently holding 19.1 billion shares, or 10.8 percent stake, in CCB with a lock-up period till October 27.



October 14: ZTE Corporation, a leading Chinese telecom equipment and cell phone producer, has clinched a $400 million deal with Maxis, Malaysia's largest mobile telecom operator, on the construction of GSM network in India. Under the terms of the agreement, ZTE will help Aircel, a subsidiary of Maxis, expand its GSM coverage in India.



October 14: International Business Machines Corporation is opening its first research facility in about a decade, inaugurating an operation in Shanghai that will work to build new applications for the Internet and small businesses. The world's biggest technology companies, including Google Incorporation and Microsoft Corporation, are increasingly expanding research facilities in China, which produces more than 700,000 electrical engineering graduates each year.



October 13: China may shoulder a huge risk without proper compensation if it buys T-bonds from the US government as the bonds would be sold to raise funds for buying bad assets from US financial institutions. This process would represent a de facto China-US financial agreement for swapping China’s growth assets and US fixed-return assets- it should thus negotiate an investment option to share in any growth of the underlying institutions and or insist on above inflation returns.




Food/Consumer Product Safety Issues

October 14: Chinese Foreign Ministry announced that China is making sample testing on dairy export products and will take measures once any food safety problems are found. Foreign Ministry spokesman Qin Gang announced at the press conference that China understands the restrictions on Chinese dairy products taken by some countries after melamine was detected in Sanlu baby milk powder. Once any problems are found in the sample test of dairy products for export, China will notify countries involved and order the producers to recall or destroy the products.




Insurance & Finance

October 14: Hong Kong-based investment holding company Jia Sheng Holdings Limited formerly known as Carico Holdings Limited, said it would sell a 70.16 percent stake in its unit Unicla International Limited for $901,880. Hong Kong-listed company will rake in about $772,997 million from the stake sale, which would be used to replenish its working capital.



October 14: Shanghai Jinfeng Investment Company Limited said that its directorate has approved the proposal to issue no more than $87.81 million worth of corporate bonds. The maturity of the bonds will be three to five years. Proceeds from the issuance will be used to repay short-term bank loans and supplement working capital.



October 14: China's central bank sold $21.97 billion worth of bills and repurchase agreements in its regular open-market operation. The People's Bank of China sold $8.78 billion worth of one-year bills at 3.7022 percent, below the rate of 3.9069 percent on the one-year bills the central bank sold previously.



October 14:  China Petroleum and Chemical Corporation, parent of Sinopec, will not cash in 4.335 billion of non-tradable shares unlocked. The parent group had never sold any Sinopec shares so far and the company does not plan to sell the freed-up stocks currently. These 4.335 billion of shares accounted for 5 percent of total capital stock of Sinopec.



October 14: TBEA Company Limited, a China-based transformer manufacturer, plans to issue no more than $175.63 million worth of short-term financing bonds in China. The one-year financing bonds will be issued in batches, and the proceeds will be used to supplement its working capital and repay part of the bank loans.



October 14: Hangzhou Wahaha Group Company is considering an acquisition of the dairy company at the center of China's milk scandal. Wahaha, China's largest domestic beverage producer and a joint-venture partner of Groupe Danone SA, confirmed that chairman Zong Qinghou has said the company is interested in acquiring Shijiazhuang Sanlu Group Company.




October 14: China Development Bank plans to issue ten-year fixed-rate bonds worth $2.92 billion on the interbank market on October 16. The bank said in a statement that it has the option to add up to $1.46 billion in the course of issuance, depending on the result of the auction. The lender revealed earlier that a total of $84.89 billion worth financial debt would be issued for the whole year of 2008.



October 14: Shanghai Zijiang Enterprise Group Company Limited, a China-based business group engaged both in packaging and real estate business, plans to acquire 25 percent of stakes each in Shanghai Ziri Packanging Company Limited and Shanghai Ziquan Packaging Company Ltd from Sunstar Investment Limited.





October 14: Asia's largest online retailer Taobao.com's transaction volume exceeded $1.46 billion in September. Taobao.com will launch a series of e-commerce support measures to help SMEs develop domestic market. Alibaba Group, the parent company of Taobao.com, announced recently it will invest $731.87 million in Taobao.com over the next five years.




Defense & Exports Control

October 14: General Staff Chief of the Chinese armed forces Chen Bingde and Supreme Commander of the Swedish Armed Forces Hakan Syren agreed to further develop military cooperation between the two sides during their meeting. Chen, chief of General Staff of the Chinese People's Liberation Army, said the Chinese side attaches great importance to developing relations with the Swedish armed forces and believes that it is conducive to bilateral ties and cooperation between thetwo armed forces.



October 14: The SAS SPIOENKOP, a warship from the South African Navy, will arrive in Shanghai. The trip marks a milestone in Sino-African relations as the first African Navy ship is to pay an official visit to China. The SAS SPIOENKOP, headed by Captain Christopher Manig, will be docked in east China's financial hub for five days.




Cross - Straits

October 14: China's mainland customs authority said trade with Taiwan would continue maintaining the current momentum to grow steadily. Trade between the mainland and Taiwan in August amounted to $12.23 billion, in which the mainland's imports were worth $9.7 billion and exports to Taiwan achieved a record $2.52 billion. Through August, trade between the mainland and Taiwan totaled $93.11 billion, soaring 20 percent year on year.




General News

October 14: Air China Limited, facing its first drop in full-year domestic traffic since 2003, forecast an increase of as much as 10 percent in 2009 as the nation's growth shields the carrier from a global economic slowdown.



October 14: The China Chamber of Commerce's fuel distribution unit denied a report it may sue PetroChina Company and China Petroleum & Chemical Corporation, the nation's biggest oil companies, for allegedly breaching the anti-monopoly law. The group will instead submit proposals to the government to help independent suppliers.



October 14: Chinese Vice Premier Hui Liangyu urged anti-seismic engineering innovation should be applied into house building to ensure all people a "safer shelter."  Hui added that "We should promote the use of anti-seismic engineering technology innovation to build safer residential areas, communities and cities."



October 14: China issued a draft reform of the country's health care system in an effort to solicit public opinion. It's one step toward a universal medical system which China hopes to have in place by 2020. The concept of the draft is to ensure public medical institutions don't operate for profit. Changes also emphasize disease prevention, health care in rural areas and the development of both western and traditional medicines.



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