China Economy Forum

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Yuan hits record high on strong China trade data

By Reuters | 8 May, 2013, 10.25AM IST

SHANGHAI: China's yuan marched to a record high on Wednesday after trade data showed export growth beating expectations, reviving suspicions that firms are manipulating trade invoices in order to skirt China's capital controls and bet on yuan appreciation.

China's exports in April rose 14.7 per cent from a year earlier, while imports grew 16.8 per cent, leaving the country with a trade surplus of $18.16 billion for the month. That compared with a deficit of $823 million in March.

Perhaps anticipating that trade data would push the yuan higher, the People's Bank of China ( PBOC) set its midpoint at its strongest level ever and sharply higher than Tuesday's fix.

Spot yuan touched a record high of 6.1424 per dollar and remained near that level at midday.

The yuan has rebounded sharply since Monday, when it suffered its worst day in five months after China's foreign exchange regulator released new rules to crack down on hot money inflows and fake trade invoicing.

The new rules jolted the market, with traders worrying that banks would have to buy a large amount of dollars in order to comply with new limits on long yuan positions.

But bullish yuan sentiment has now returned, with dealers saying that client demand for yuan remains significantly stronger than dollar demand.

The yuan has also gained support from expectations of policy reforms to liberalise the exchange rate.

Premier Li Keqiang told a cabinet meeting on Monday that the government would prepare an "operational plan" to achieve yuan convertibility on the capital account. Li specifically mentioned a plan for a pilot programme to allow overseas investment by individual Chinese investors.

Li's statement also boosted expectations that the central bank will widen the yuan's daily trading band in the coming weeks or months.

The PBOC's record-high midpoint on Wednesday appeared to continue the campaign to bring the fixing closer to the spot rate, thereby preventing an abrupt one-off appreciation immediately following the band widening.

The central bank currently allows the dollar/yuan exchange rate to diverge by no more than 1 per cent from the midpoint it sets each morning.

At current levels, the exchange rate is 0.88 per cent below the midpoint, down from the 0.95 divergence that the market maintained for most of the year.

Yuan hits record high on strong China trade data - The Economic Times

 

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China's education expenditure reaches 2.2 trln yuan
English.news.cn 2013-05-08 15:49:57

news.xinhuanet.com

BEIJING, May 8 (Xinhua) -- Public expenditure on education in China reached 2.2 trillion yuan (357 billion U.S. dollars) in 2012, accounting for 4 percent of its GDP, the Ministry of Finance (MOF) said Wednesday.

Of the total, 378.1 billion yuan was pooled from the central government's budget, an increase of 15.7 percent year on year, a ministry statement said. The rest was sourced from local government budgets.

China is moving to shift its growth pattern by enhancing education, with more resources allocated to rural, remote and poor schools last year.

In 2012, the country earmarked 86.54 billion yuan from its central budget to support nine-year compulsory education in rural areas.

With the money, tuition was waived and textbooks provided for free to 120 million rural students. The country also provided allowances for 13.33 million students who came from poor families and attended boarding schools in central and western regions.

The central government also offered a subsidy of 15.05 billion yuan to improve the nutrition of primary and junior high school students in rural areas.

To help more pupils get into senior high school when they finish nine-year compulsory education, the central government provided 4.66 billion yuan last year as a subsidy to 4.91 million senior high school students.

In an effort to support higher-learning education, the central government provided scholarships to 5.61 million students with a total expenditure of 16.2 billion yuan.

China originally planned to raise the government's input on education to 4 percent of GDP by the end of 2000, but did not achieve the goal until last year.

 

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China Focus: Inflation rises to 2.4 pct in April

English.news.cn 2013-05-09 15:40:02

BEIJING, May 9 (Xinhua) -- China's consumer inflation slightly accelerated in April, but still within a mild range that leaves room for policymakers to fine-tune policies to support the tepid economic recovery, official data showed Thursday.

China's consumer price index (CPI), a main gauge of inflation, grew 2.4 percent year on year in April, up from 2.1 percent in March but well below the year's control target of 3.5 percent, according to the National Bureau of Statistics (NBS).

The rise is largely in line with the market forecast of around 2.3 percent.

The NBS attributed the gain mainly to an unusual increase in vegetable prices during that month as low temperatures and scarce rainfalls disrupted supplies.

In April, food prices, which account for nearly one-third of weighting in China's CPI, increased 4 percent year on year, with the prices of vegetables rising 5.9 percent, NBS data showed.

On a monthly basis, consumer prices in April edged up 0.2 percent.

Liu Ligang, chief economist with Greater China at ANZ Bank, expects the CPI growth in May to stay below 3 percent and gradually pick up pace in the latter half of the year due to a low year-ago comparison base.

"But given the subdued momentum in the economic recovery, the CPI will not see rapid gains this year," he added.

The country's economic growth unexpectedly dipped to 7.7 percent in the first quarter, falling short of market expectations and suggesting a continued tepid economic rebound for the world's second-largest economy.

While analysts largely believe inflationary pressures are not a cause for concern in the short term, Thursday's data regarding prices at factory gates demanded more market attention.

China's producer price index (PPI), which measures wholesale inflation, fell 2.6 percent year on year in April, marking the 14th straight month of decline and the steepest drop in six months that pointed to continued weak market demand.

Official data earlier this month showed China's Purchasing Managers' Index for the manufacturing sector fell to 50.6 percent in April from 50.9 percent in March. The sub-index for new orders edged down 0.6 percentage points from the previous month to 51.7 percent.

Given the weak growth activity and relatively subdued inflation, China may bend towards looser monetary policies to keep liquidity flowing to nurture the recovery, while proceeding with structural reforms to sustain long-term growth, Liu said.

The possibility of an interest rate cut within the year is on the rise, he projected.

But Lian Ping, an economist with the Bank of Communications, held that such a radical move is unlikely, as the current liquidity is ample enough to support growth and further significant easings may once again fan up property prices.

Besides, the central bank's sale of 10 billion yuan (1.6 billion U.S. dollars) of three-month bills on Thursday dampened the possibility of a rate cut, he noted.

Lu Zhengwei, chief economist at the China Industrial Bank, said instead of relying on reducing the interest rate or banks' reserve requirement ratio, the central bank will continue to adjust liquidity via open market operations.

China Focus: Inflation rises to 2.4 pct in April - Xinhua | English.news.cn

 

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With the recent openings of Line 14 and two stations on Line 10，Beijing metro length has reached 456 km, including 17 lines, 270 stations and 37 interchange stations:

The 57km Line 10 is Metro Beijing's second circle line.

The expansion of the network continues apace.

 

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5/14/2013 @ 9:32PM

Volkswagen Stakes Out Greater Turf In China

By Kenneth Rapoza

Volkswagen said it will invest $1.95 billion in a new auto manufacturing plant, this one in Central China.

The new plant will be set up by Volkswagen’s joint venture with China’s SAIC Motor SAIC Motor, and will have an annual output of 300,000 units, German national daily newspaper Frankfurter Allgemeine Zeitung reported over the weekend.

Volkswagen Stakes Out Greater Turf In China - Forbes

 

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Chinese chip maker sold more than Intel and Qualcomm

Allwinner is a winner in the tablet market

09 May 2013 10:11 | by Nick Farrell

Chinese chip vendor Allwinner Technologies might have sold more application processors for tablets in 2012 than Intel and Qualcomm put together.

According to eeTimes it is a myth that Samsung, Nvidia, Qualcomm and Intel are the top mobile chipmakers.

Quoting a Strategy Analytics report, last year 2012 Chinese vendors grabbed 20 percent volume share of the tablet application processor market between them.

While these vendors might be manufacturing at the low end of the market it is a market that by value grew 83 percent year-on-year to reach $2.7 billion.

Sravann Kundojjala, senior analyst with Strategy Analytics, pointed out that in China the top seller is dual-core ARM chips which sell for $4 or $5 and quad-cores at $8 or $9. This is less than half what Nvidia is selling its equivalent chips for and so probably the Chinese vendors, while significant in volume, do not yet have 10 percent of the market by value.

While Apple had about 48 percent revenue share of the tablet processor market in 2012, since its chips are only used in the iPad this limits their market share. Nvidia, Texas Instruments, Samsung and Qualcomm made up Strategy Analytics' top-five ranking of vendors.

Strategy Analytics reckons Nvidia led the non-iPad tablet market with 27 percent revenue share in 2012 having scored high-profile design wins in the Google Nexus 7 and the Microsoft Surface RT.

Strategy Analytics would like you to buy a $6,999 report but it is not difficult to guess who the behind the scenes Chinese chipmakers who are winning in the current market. There is Allwinner, Rockchip, Amlogic, Infotmic, Ingenic, Hi-Silicon, and NuFront.

EETimes claims that Allwinner, Rockchip and Amlogic are probably responsible for more than half the Chinese supply of tablet processors in 2012. Allwinner clearly has about 10 percent of the global supply by volume.

This would mean that it made more than Intel and Qualcomm who missed the tablet processor boat in 2012 and captured less than five percent volume share in the tablet applications processor market.

The figures show how far Chipzilla in particular has to go before it has made an impact, but also how close the Chinese chipmakers are to being household names.


Read more: Chinese chip maker sold more than Intel and Qualcomm - Allwinner is a winner in the tablet market | TechEye

 

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Ram with third-generation Chinese artificial heart sets survival record | China Daily

"Ram with artificial heart sets survival record
Updated: 2013-05-14 11:17
(chinadaily.com.cn)

The ram Tianjiu, or "Forever", which has survived 61 days after receiving a third-generation artificial heart implant, appears at a news conference in Tianjin on Monday. Tianjiu, which has set a survival record for an animal with such an implant, is in healthy condition at the animal laboratory center at TEDA International Cardiovascular Hospital. The implantable device, the first of its kind in China, was developed by the hospital and the China Academy of Launch Vehicle Technology. [Photo/Xinhua]

The ram Tianjiu, or "Forever", which has survived 61 days after receiving a third-generation artificial heart implant, is fed at a news conference in Tianjin on Monday. [Photo/Xinhua]

TIANJIN - A sheep implanted with a new type of artificial heart developed by Chinese scientists using cutting-edge aerospace technology has lived for 62 days thus far, the heart's developers announced on Monday.

The development of the heart was jointly conducted by scientists from the China Academy of Launch Vehicle Technology and TEDA International Cardiovascular Hospital in north China's Tianjin Municipality.

The sheep, nicknamed "Tianjiu," is in sound condition after receiving the blood pump on March 14, said Liu Xiaocheng, president of the hospital.

He said researchers used magnetic suspension and hydrodynamic bearings -- both examples of aerospace technology -- to design and produce an implantable third-generation ventricular assist device (VAD), a mechanical pump used to support heart function and blood flow in people with weakened hearts.

The device is the first of its kind to be fitted with a battery and controller. The sheep experiment is similar to a clinical implantation, the scientists said.

Once the device is marketed, it may end suffering for the 16 million people in China with failing hearts, as many patients are waiting for heart transplants.

China began research on VAD in the early 1980s. Clinical use of commercialized VADs had yet to take place until now."

 

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EU report on dangerous products cites imports from China

Toys, clothes and gadgets from China are being flagged in increasing numbers by the EU's rapid alert system for dangerous goods (RAPEX). Ignorance of the rules is cited as a cause.
China, including Hong Kong, was indicated as a country of origin for 58 percent (1,126 notifications) of products reported to the EU watchdog RAPEX in 2012. But officials in Brussels were keen to stress that the statistic reflected China's dominant position as an exporter and did not necessarily mean that the country's products had become less safe.
"The high number is due to the significant market penetration of Chinese-manufactured consumer products in European markets," EU Consumer Affairs Commissioner Tonio Borg said.
Turkey came next on the list, with 5 percent of notifications in 2012.
RAPEX ensures that information about dangerous products is quickly circulated between member states and the European Commission, so that appropriate action can be taken everywhere in the EU. Products identified by RAPEX can be banned, withdrawn from the market or rejected by customs authorities.
Octavian Vasile, a policy officer at RAPEX, said Chinese companies were often not aware of the rules. "We are trying to work on that in organizing workshops especially meant for the Chinese industry, especially on toys because this is quite a sensitive category of products," Vasile said.
All the EU countries plus Iceland, Liechtenstein and Norway are members of RAPEX. Five member states accounted for more than half of all RAPEX notifications in 2012: Hungary, Bulgaria, Spain, Germany and the UK.
In 2012, a total of 2.278 notifications on dangerous products posing risks to the health and safety of consumers were submitted through the RAPEX system by member states - a rise of 26 percent over the previous year. Of the 2,278 notifications, 1,938 concerned products that posed a serious risk to consumers, according to the EC.
jm/mkg (dpa, AFP)

EU report on dangerous products cites imports from China | News | DW.DE | 16.05.2013

 

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EU report on dangerous products cites imports from China

Toys, clothes and gadgets from China are being flagged in increasing numbers by the EU's rapid alert system for dangerous goods (RAPEX). Ignorance of the rules is cited as a cause.
China, including Hong Kong, was indicated as a country of origin for 58 percent (1,126 notifications) of products reported to the EU watchdog RAPEX in 2012. But officials in Brussels were keen to stress that the statistic reflected China's dominant position as an exporter and did not necessarily mean that the country's products had become less safe.
"The high number is due to the significant market penetration of Chinese-manufactured consumer products in European markets," EU Consumer Affairs Commissioner Tonio Borg said.
Turkey came next on the list, with 5 percent of notifications in 2012.
RAPEX ensures that information about dangerous products is quickly circulated between member states and the European Commission, so that appropriate action can be taken everywhere in the EU. Products identified by RAPEX can be banned, withdrawn from the market or rejected by customs authorities.
Octavian Vasile, a policy officer at RAPEX, said Chinese companies were often not aware of the rules. "We are trying to work on that in organizing workshops especially meant for the Chinese industry, especially on toys because this is quite a sensitive category of products," Vasile said.
All the EU countries plus Iceland, Liechtenstein and Norway are members of RAPEX. Five member states accounted for more than half of all RAPEX notifications in 2012: Hungary, Bulgaria, Spain, Germany and the UK.
In 2012, a total of 2.278 notifications on dangerous products posing risks to the health and safety of consumers were submitted through the RAPEX system by member states - a rise of 26 percent over the previous year. Of the 2,278 notifications, 1,938 concerned products that posed a serious risk to consumers, according to the EC.
jm/mkg (dpa, AFP)

EU report on dangerous products cites imports from China | News | DW.DE | 16.05.2013

Hmm it's not really something new. It's been there way of living ever since.

They are actually proud of producing garbage-quality products that are defective, low class, fake and disposable which also tainted with lead, melamine, formalin, cyanide just to name a few, unmindful of the harmful effects to humans.

That's why the public should really be careful and aware of this.

 

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2013-05-16 国内首颗55纳米北斗芯片问世
2013-05-16 China's 55 nm Beidou chip is launched

[video]http://news.cntv.cn/2013/05/16/VIDE1368681361007418.shtml[/video]

Freeze @0:25 to look at the specs of the chip like this:

 

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China's cotton reserve is 63% of world's total
Updated: 2013-05-17 13:59 By ZHOU SIYU ( chinadaily.com.cn)

China's cotton reserves were estimated to stand at 5,820 bales this year, accounting for 63 percent of the world's total, the United States Department of Agriculture said in a report.

A bale is a standard unit of measurement for cotton and is equivalent to approximately 226 kg.

The government admitted to having “a high level of reserves” but did not divulge the exact figure.

The USDA also estimated that global cotton consumption will grow by 2 percent this year, the third consecutive year for increased consumption. Consumption in China, India and Pakistan will account for 70 percent of the world's total, the USDA said.

 

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Greece to buy 142 ships from China

Updated: 2013-05-19 00:22 ( Xinhua/ChinaDaily)

SHANGHAI - Greek Shipping Minister Kostis Moussouroulis said here Saturday Greek shipowners have recently signed contracts to buy 142 new ships from Chinese shipbuilding companies.

The orders, which were signed in April, accounted for more than 60 percent of the recent global orders of Greek shipowners, said the Greek official.

The shipping industry, including shipbuilding, is one of the most important sectors for economic and trade cooperation between the two countries.

In the next decade, China will remain an important global exporter and become an increasingly important importer, according to the minister.

The new orders are the investment of Greek shipowners for the future, said Moussouroulis.

Wang Qi, general manager of Shanghai Waigaoqiao Shipbuilding Co Ltd, said Greece has become an important client of China's shipbuilding enterprises.

As one of China's major shipbuilding companies, Shanghai Waigaoqiao Shipbuilding Co Ltd has built a total of 67 ships for Greek shipowners in recent years, accounting for about 30 percent of the company's output, Wang said.

Greek Prime Minister Antonis Samaras is on an official visit to China from Wednesday to Sunday. Leaders of the two countries have vowed to boost cooperation.

0Related StoriesChina to invest more in Greece

 

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China to invest more in Greece

Updated: 2013-05-18 08:03 By Bao Chang ( China Daily)

Containers are backlogged at the port of Piraeus, near Athens. China will expand its investment in the port, considered a vital gateway for shipping heading to Europe. [Photo/AFP]



Bilateral trade expected to double by 2015 as economic links tightened

China is to increase its investment in Greece's port industry, and deepen its economic ties with the southern European country as it struggles to clear its massive debts, Vice-Minister of Commerce Jiang Yaoping said on Friday.

Speaking at a China-Greece business forum - being held during a five-day visit by Greek Prime Minister Antonis Samaras - Jiang said China will expand its investment in Greece's Piraeus harbor, the country's largest port.

After operating parts of Piraeus for the past three years, Chinese shipping giant China Ocean Shipping (Group) Co is believed to have invested 1 billion euros ($1.29 billion) for a 60 percent stake in Piraeus port early this year.

Fu Chengqiu, the managing director of Piraeus Container Terminal SACOSCO Group, said on Friday that despite Greece still being in deep crisis, he still considers Piraeus as a vital gateway for shipping heading to Europe.

Samaras also encouraged Chinese companies to invest in his country's logistics services industry, highlighting Greece's good geographical position.

To clear its huge national debt, Greece plans to privatize a variety of government-owned assets, including airports, government buildings, petroleum companies, natural gas fields, and several mining, postal and real estate projects, to raise an estimated 50 billion euros.

Introducing the privatization agenda, Stelios Stavridis, the president of the country's national assets organization, Hellenic Republic Assets Development Fund, said the sell-offs present huge opportunities for Chinese investment.

In a meeting at the Great Hall of the People on Thursday, Premier Li Keqiang told his Greek counterpart Samaras that he expected to see bilateral trade volume double by 2015.

In 2012, total trade between China and Greece was worth $3.38 billion, or 0.6 percent of the total trade volume between China and the European Union.

Constantine Michalos, the president of the Union of Hellenic Chambers, said: "Greek products including olive oil, wine and honey are very popular in the Chinese market and are well tailored to Chinese consumers."

In a move to popularize Greek food and beverage products in China, some Greek enterprises have launched food processing projects in Beijing, said Ma She, deputy director-general at the department of European affairs of the Ministry of Commerce.

 

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China's service outsourcing up 43.6% in Q1

Updated: 2013-05-18 23:29 ( Xinhua/ChinaDaily)

FUZHOU - Chinese companies took service outsourcing orders of $11.7 billion in the first quarter, up 43.6 percent year-on-year, said a Ministry of Commerce official on Saturday.

The country's offshore service outsourcing businesses reached $8.1 billion in the first three months, up 42 percent year-on-year, said the official at a forum held in Fuzhou, capital of east China's Fujian province.

As of March, China's service outsourcing industry had 4.46 million employees. Some 67.7 percent of them had college education backgrounds.

The orders of offshore service outsourcing which Chinese enterprises took increased to $33.6 billion in 2012, compared with $4.69 billion in 2008.




Exporters hit hard by rising yuan

Updated: 2013-05-18 02:29 By Zheng Yangpeng in Beijing, Yu Ran in Shanghai and qiu quanlin in Guangzhou ( China Daily)



For Xia Guangyao, chairman of Wenzhou Jialunte Textile & Finery Co Ltd in Zhejiang province, 2013 has been the worst of the past five years for his business.

The number of orders from the United States and European countries was expected to be 50 percent lower than 2010, even a bit lower than 2012, he said. The average amount of a single order was also cut from 1,000 units to 500 as market demand in the US and Europe remained low, which slashed the profit margin from 15 percent to about 8 percent.

Xia said the dwindling amount of orders from overseas since last year was the major challenge. The continuous appreciation of the yuan further ate into the profit margin.

Exporters in Guangdong province, an export powerhouse, have also felt the pinch of rising yuan value.

Chen Yanping, assistant general manager of Guangzhou Fine Horse Leather Co, said the company had to increase the price of its products for new orders, especially those to be shipped to Japan due to the quick currency appreciation.

"Now we only accept short-term orders within three to six months," Chen said.

Chen said his company had to increase the price of products to offset the loss brought about by the rising value of the yuan against the dollar and the Japanese yen.

Zhao Wei, a senior sales manager of TCL Lighting Electrics Co, said his company had planned to break its traditional reliance on sales agents and build its own marketing channels in Japan. But now it has to delay the plan due to the rising appreciation of the yuan against the Japanese yen.

For Chinese exporters who have been facing sluggish demand from European and US markets since last year, the rising yuan added another burden.

According to the latest data from the Bank for International Settlements, the yuan's exchange rate index in April was 115.24, or 0.88 percent higher than in March.

This is the sixth consecutive month that the index has broken its record since it was launched since 1994.

Shen Danyang, spokesman for the Ministry of Commerce, said on Thursday that the rise of the yuan has dented exporters' long-term business confidence.

Many foreign trade experts have called for delaying the further liberalization of the exchange rate-forming mechanism, in order to mitigate the negative impact on China's exporters. But some other experts said the reform should be pushed forward.

Li Gang, a researcher at the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce, said opinions differ on whether the exchange rate should be allowed to fluctuate within a wider range. "The government should set a long-term goal as to whether and when the renminbi should be made convertible under capital accounts," Li said.

Zhou Shijian, a trade expert at Tsinghua University, said the only way for Chinese enterprises to survive is to improve the quality of their products and climb up the value chain.

 

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Taiwan banks' RMB deposits top 60b yuan

Updated: 2013-05-17 16:55 ( Xinhua/ChinaDaily)


TAIPEI - Outstanding renminbi-denominated deposits at financial units in Taiwan hit a record high of 60.26 billion yuan ($9.72 billion) as of May 15, the island's monetary authority said on Friday.

The figure represents a 54.5-percent surge from the end of February and a 24.8-percent increase from the end of March.

Market analysts attributed the fast expansion in yuan deposits to the currency's steady appreciation and warming cross-Straits economic ties.

According to a Standard Chartered report, Taiwan will accumulate a yuan-denominated fund pool of between 100 billion and 150 billion yuan by the end of 2013.

Taiwan's banking sector has been allowed to conduct yuan-denominated transactions, such as deposits, lending and remittances since Feb 6, after a cross-Straits currency clearing mechanism was established.

The island is now the second major market after Hong Kong that is able to clear transactions in the yuan, as the Chinese mainland has stepped up efforts to foster the global use of the currency.