China Economy Forum

[TaiShang]

Anbang buys respected Belgian bank

2015-06-30

Anbang Insurance Group has agreed to buy Delta Lloyd Bank Belgium.

The signing ceremony on Monday was attended by Chinese Premier Li Keqiang and Belgian Prime Minister Charles Michel during his trip to the European Union country.

One of the largest insurance corporations in China, Anbang had already acquired a 100 percent stake in the renowned Belgium-based financial institution Fidea Assurances.

"The bilateral relations between China and Belgium are strong," a spokesperson for the Anbang Insurance Group said. "And the acquisition of Delta Lloyd Bank Belgium is not only a win-win situation but also a great starting point in the deepening relationship between the two countries."

Delta Lloyd is 260 years old, and provides asset management and other financial products to high-end corporate clients. The bank is also an important partner of Fidea Assurances.

Anbang Insurance Group has total assets of more than 800 billion yuan ($128.9 billion).

 

[TaiShang]

Airbus A330 completion, delivery center to be built in Tianjin
July 3, 2015
An A330 completion and delivery center (C&DC) will be set up in Tianjin, northern China, the aircraft manufacturer giant Airbus announced Thursday in a press release.

The A330 C&DC will be located near the site of the Airbus A320 family final assembly line in Tianjin.

The center will cover aircraft completion activities including reception, cabin installation, aircraft painting, engine run and flight test, as well as aircraft delivery and customer flight acceptance, Airbus said.

The plant will employ about 250 people and have an output of two aircraft per month. The first delivery is planned by the end of 2017, according to Airbus.

Airbus and its Chinese partners, namely the Tianjin Free Trade Zone Investment Company Ltd (TJFTZ) and the Aviation Industry Corporation of China (AVIC), signed a framework agreement to set up the A330 C&DC Tianjin.

The agreement was signed at the Airbus site in Toulouse, France.

"The signature of this framework agreement on the A330 Completion and delivery center will open a new chapter of strategic cooperation on wide-body aircraft with China. Together, we will develop new facilities and capabilities, and attract new suppliers and businesses in China," said Fabrice Bregier, Airbus president and CEO.

Airbus also signed a letter of intent with AVIC on cabin development cooperation and procurement frame contract with Zhejiang Xizi Aerospace Fastener Co Ltd for design, development, manufacturing, and supply of standard fastener parts.

At present, the in-service Airbus fleet with Chinese operators comprises over 1,150 aircraft (over 150 A330 Family and over 980 A320 Family aircraft).

In the period between 2014 and 2033, Airbus forecasts a demand in China for more than 5,300 new commercial passenger aircraft sized over 100 seats plus freighters.

 

[Audio]

"Hold stocks with confidence. Win glory for the country even if you lose the last penny."

Fan Shaoxuan-Weibo TV senior executive

real estate has become an acceptable form of collateral for Chinese margin traders

China Tells Investors: Go Ahead, Bet the House on Stocks - Bloomberg Business

 

[StrategicAnalyzer]

quite good...

 

[Jlaw]

China's methanol car maker invests Iceland's leading new energy producer

English.news.cn 2015-07-04 03:22:59

REYKJAVIK, July 3 (Xinhua) -- China's Geely Holding Group, known as the world's leading methanol vehicle manufacturer, inked a deal on Friday to make an investment of 45.5 million U.S. dollars in three years to Iceland's Carbon Recycling International (CRI), known as the world leader in power to methanol technology.


Addressing the agreement signing ceremony, Li Shufu, founder and chairman of Geely Holding Group, said, "it is no doubt that methanol will be widely used as its advantages compared with gasoline fuel will be more and more prominent. I believe the cooperation with CRI will greatly promote Geely's development in clean energy for vehicles."

CRI produces renewable methanol, marketed under the Vulcanol brand, from carbon dioxide, hydrogen and electricity for energy storage, fuel applications and efficiency enhancement.

Methanol is a clean burning, high octane fuel that can be blended with gasoline for automobiles and used in the production of biodiesel or fuel ethers and reduces carbon emissions by more than 90 percent compared to fossil fuels.

"The investment of Geely to CRI will enable carbon recycling expand into China as well as into Europe. It will accelerate the deployment of our technology in China as well as in Europe. It will facilitate the development of methanol fuel cars," said K-C Tran, chief executive officer of CRI.

Geely became the first auto manufacturer in China to begin conducting research and development into methanol vehicle solutions in 2005, and has since acquired dozens of patents.

It's Englon SC7 sedan was the first methanol-fuelled car to receive approval from China's ministry of industry and information technology.

Scientific studies indicate that methanol-fuelled cars generate as much as 80 percent fewer fine particulate matter (PM2.5) emissions than traditional gasoline-powered equivalent and cost an average of 40 to 50 percent less to fuel.

"In this sense, Geely group is a natural investment partner for CRI. With the deepening of this partnership, we will explore the possibility of promoting methanol vehicles that will meet local standards here in Iceland and other European countries," Li added.

Describing Geely's cooperation with CRI as an important practice to realize their commitment to the global sustainable development, Li said, "Geely is unique in researching and manufacturing methanol vehicles around the world, and so is CRI in converting carbon dioxide into methanol. The cooperation between these two companies will promote the development of the clean energy and the carbon cycle economy."

 

[TaiShang]

Chinese company acquires Czech turbine manufacturer
July 5, 2015
Xi'an Shaangu Power, a Chinese engineering company based in northwestern Shaanxi province, paid 318 million yuan (US$51 million) for a 75 percent stake of Brno Ekol, a leading Czech turbine manufacturer.

According to an agreement signed by the two companies in January, the acquisition will take place in two steps, with delivery of the remaining stake completed in the years to come.

It is the biggest amount paid by China into Czech's manufacturing industry over the recent years, accounting for about 17 percent of China's total investment into the European country.

Shaangu Power, established in 1999, is a major industrial compressor producer in China.

 

[TaiShang]

Margin trading cops major blame for market crash
By Ye Zhen | July 6, 2015, Monday | Shanghai Daily

Alarmed by a stock market crash that has wiped about 30 percent off the value of the Shanghai Composite Index in three weeks, Chinese authorities have scrambled to step up rescue efforts.

On Saturday, China’s 21 biggest brokerages said they agreed to set up a 120 billion-yuan fund (US$19.4 billion) to buy the exchange-traded funds of blue-chip shares, starting on Monday. They also pledged not to sell shares from their own portfolios until the Shanghai index goes back to 4,500 points. Listed brokerages pledged to buy back shares of their own companies.

That followed statements from the Shanghai and Shenzhen exchanges over the weekend that they are suspending initial public offerings because of “the recent significant market volatility.”

Financial magazine Caijing reported that the decision to halt IPOs was made at a meeting of the State Council, China’s Cabinet. No sources were identified.

There market nosedive is a grave matter of widespread public concern for the government because more than 80 percent of share investors in China are individuals, not institutional money. In many cases, ordinary people who jumped on the back of the bull this year have had no prior experience with the risks of investing nor familiarity with the wisdom of that old saying: “markets go up by the stairs and down by the elevator.”

“The crash of a highly-leveraged stock market may lead to financial crisis,” said Guan Qingyou, an economist with Minsheng Securities. “It’s urgent for the government to step in and boost the market with real money. In addition to providing liquidity and suspending new-share sales, the government may have to close the market or dramatically change trading rules.”

The Shanghai Composite index dived 12 percent last week as investors ignored a flurry of initiatives announced to stanch relentless selling.

To underscore the magnitude of the collapse, some market comments have noted that the share market losses in China in the past three weeks total more than 10 times the entire GDP of Greece, another country making headlines amid financial turmoil.

Last Wednesday, the China Securities Regulatory Commission said it would ease rules on margin trading, allowing investors to pay back losses in ways other than forced liquidation of shares. It also said it would allow investors whose market assets fall below the 500,000-yuan brokerage minimum to continue trading, and would permit brokerages to roll over margin trading contracts with clients.

Also on Wednesday, the Shanghai and Shenzhen stock exchanges announced about a 30 percent cut in stock transaction fees, and the China Securities Depository and Clearing Co said it would reduce stock transfer fees by about 33 percent, effective August 1.

Margin trading and a flood of IPOs have copped most of the blame. Regulators also said last week they are investigating possible market manipulation.

The market crash follows a dizzying rise in share markets. The Shanghai Composite Index soared more than 150 percent over the past year to a seven-year high of 5,178 points on June 12.

Margin trading, or the ability to buy shares with borrowed money, largely fueled the bull market. The leverage tool was first introduced in China in 2010. When securities regulators suddenly tightened rules on margin financing last month, the panic began.

Who shot the bull?

Lenders have the right to force liquidation of an investment portfolio if a client fails to respond to a margin call by depositing more cash. That leads to a self-fueling cycle of falling prices triggering selling, which in turn drags values down further and creates more margin calls.

The outstanding balance of margin trading rose to a record high of 2.2 trillion yuan on the Shanghai and Shenzhen bourses by the middle of June, a 116 percent surge from the end of last year, data from the exchanges showed.

Margin positions accounted for more than 9 percent of the A-share free-float market capitalization in late June, according to Morgan Stanley. That was higher than any historical comparison on record.

“There was clearly a bubble,” Hong Hao, chief China strategist at Bocom International Holdings Co, wrote in a note. “A rapid decline in margin trading, either from unmet margin calls and thus forced liquidation of margin accounts, or from unwinding margin accounts to take profits, led to the plunge.”

The newly announced easing of rules applies only to margin trading of designated large-cap stocks monitored by the regulatory commission. It doesn’t affect the unregulated “shadow” realm of trusts and online financing channels that lend money for margin trading without limits on investor assets or share selection.

A spokesperson for the China Securities Regulatory Commission said last week that the amount of margin financing through non-brokerage channels was around 500 billion yuan, but analysts estimate that figure to be much higher. Guotai Jun’an Securities estimated the sum could be as much as 2 trillion yuan.

The drama in stock markets came after a flurry of government stimulus measures, including aggressive cuts in interest rates and in the ratio of deposits lenders are required to keep in reserves. It also came after a new plan allowing China’s mainstream endowment pension fund to invest in stocks.

The halt in new IPOs was not unexpected. Initial public offerings were allowed to resume late 2013 after a hiatus declared by regulators to help boost a then-sagging market.

In the first half of this year, there were 190 new listings on the Chinese mainland’s A-share market, raising 147 billion yuan. That was a 265 percent surge in IPOs from a year earlier and a 316 percent increase in fundraising, according to Ernst & Young.

“Investor confidence in China’s equity market has been undermined by dramatic market falls,” said Cao Qing, a fund manager with HSBC Jintrust Fund Management Co. “More stimulus can be expected to be channeled into institutional funds to recover market confidence.”

Will rescue efforts work or is the government simply making a bad situation worse?

Zhu Ning, deputy dean at the Shanghai Advanced Institute of Finance at Shanghai Jiao Tong University, warned that some rescue policies could encourage unbridled speculation and further distort the market.

“Capricious regulatory measures may also lead to disregard for market rules and reduce the effectiveness of supervision,” Zhu said. “They can cause confusion and skew expectations, undermining the market’s role in price discovery.”

Huatai Securities:

New policies to lower transaction and transfer fees signify a firm intention by the regulator to protect the market and encourage trading. The crux of volatile trading was concern over restricted margin trading, which had somewhat demolished market confidence. The policies had been a suitable remedy to restore rationality in the market. If daily transactions are set at a level of 800 billion yuan, the lower fees would save investors more than 60 billion yuan a year. The market will gradually return to normal, and financial shares should prove lucrative for investors.

Industrial Securities:

After recent ups and downs, a bullish market will emerge in which investors will pay more attention to shares with less investment risk, such as railway, power equipment, clean energy and finance stocks. There are also solid stocks that reflect the nation’s larger economic concepts, such as the Internet, environmental protection, sports, “Made in China 2025” and new energy cars.

Minsheng Securities:

In a long view, the market will see a different trend of shares not rising or falling across the board. Certain sectors that didn't rise as much in previous bull markets, such as finance, food and drinks, will be more popular among investors. Those related to the reform in China’s state-owned enterprises will also prove lucrative, such as stocks related to “Made in China 2025,” the military industry and environmental protection.

Galaxy Securities:

Surging blue chips in the previous bull market will be linked in the future to their sector’s performance in the real economy rather than to speculation. Investors are advised to look at shares in three key sectors: SOE-related reform, the “Made in China 2025” concept and pharmaceuticals.

Citic Securities:

Restricted margin financing was a key factor in the volatile, downward market. The rally on June 30 suggested it was positive sentiment on margin trading that had led to the market’s rise. The hasty policies that came out on the night of July 1 signified a strong stance by the regulator in maintaining a positive market. Blue chips that rebound will be those carrying some big “national label,” such as those related to SOE reform concept.

 

[Jlaw]

On Saturday, China’s 21 biggest brokerages said they agreed to set up a 120 billion-yuan fund (US$19.4 billion) to buy the exchange-traded funds of blue-chip shares, starting on Monday. They also pledged not to sell shares from their own portfolios until the Shanghai index goes back to 4,500 points.

I love these brokerages. Very smart people. The amateurs got their asses kicked lost billions, they sweep in buy the A list shares at a discount. When Shanghai composite hit 4500 points, they will slowly sell and make a killing.

I do the same thing in their shoes.

In Canada, margin rules were adjusted too. They lowered the amount of margin one can use for individual trading account

 

[TaiShang]

Chinese Student in Australia Returns 200,000 AUD to Bank after Mistaken Transfer
2015-07-07

Photo shows Dong Siqun, a 26-year-old Chinese student who returned 200,000 Australian dollars to the bank, after it had been accidentally transferred to her account. [Photo: guancha.cn]

A Chinese student in Australia who found out that 200,000 Australian dollars had been deposited in her savings account due to a bank error had returned the money immediately.

Her act of honesty has made an overnight internet sensation in China and abroad.

Dong Siqun, a 26-year-old female Chinese student says she did not notice that she had 200,000 Australian dollars in her account until she received a call from the bank, hoping that she can return the money.

The bank explained to Dong that the money was transferred to her account due to a mistake by the bank.

Dong says she thought the phone call was a telephone fraud at first.

But she says when she checked her balance, she was shocked by the huge bank balance on her account.

She immediately contacted the bank and returned all the money.

Dong has become a local star after a local newspaper reported her story.

She expresses that she regards the gain and return of the money as an interesting experience. She adds that the idea of keeping the large sum of money had never occurred to her.

 

[Jlaw]

Chinese Student in Australia Returns 200,000 AUD to Bank after Mistaken Transfer
2015-07-07

Photo shows Dong Siqun, a 26-year-old Chinese student who returned 200,000 Australian dollars to the bank, after it had been accidentally transferred to her account. [Photo: guancha.cn]

A Chinese student in Australia who found out that 200,000 Australian dollars had been deposited in her savings account due to a bank error had returned the money immediately.

Her act of honesty has made an overnight internet sensation in China and abroad.

Dong Siqun, a 26-year-old female Chinese student says she did not notice that she had 200,000 Australian dollars in her account until she received a call from the bank, hoping that she can return the money.

The bank explained to Dong that the money was transferred to her account due to a mistake by the bank.

Dong says she thought the phone call was a telephone fraud at first.

But she says when she checked her balance, she was shocked by the huge bank balance on her account.

She immediately contacted the bank and returned all the money.

Dong has become a local star after a local newspaper reported her story.

She expresses that she regards the gain and return of the money as an interesting experience. She adds that the idea of keeping the large sum of money had never occurred to her.

dumb move. I would tell the bank since you made the mistake I will take $40,000 of that. Another example of Chinese white worshipping.

 

[cirr]

China car hailing app Didi Kuaidi says raises $2 bln from investors



18 minutes ago

BEIJING, July 8 (Reuters) - China's dominant mobile car hailing company Didi Kuaidi said it raised $2 billion in a fundraising round, as competition with U.S. rival Uber Technologies Inc heats up on its home turf.

Didi Kuaidi, which has the largest market share among car-hailing apps in China, said in a statement on Wednesday the amount may rise by a "few" hundred million due to "tremendous interest from global investors".

Didi Kuaidi said the fundraising will lift its cash reserves to $3.5 billion.

New investors include Capital International Private Equity Fund and Ping An Ventures, part of Ping An Insurance Group Co of China Ltd .

Existing stakeholders, including Alibaba Group Holding Ltd , Tencent Holdings Ltd, Temasek Holdings (Private) Ltd and Coatue Management, also took part in the latest fundraising, the statement said.

(Reporting by Paul Carsten; Editing by Miral Fahmy)

China car hailing app Didi Kuaidi says raises $2 bln from investors - Yahoo Finance

 

[TaiShang]

China's major retailers see robust sales growth
July 10, 2015

China's top 100 retailers saw combined sales jump 26.2 percent year on year to 3.37 trillion yuan (544 billion U.S. dollars) in 2014, an industry association official said Thursday.

Wang Yao, vice president of China General Chamber of Commerce, said at an expo held in the eastern city of Kunshan that the annual growth rate for leading retailers was 6.4 percentage points higher than in 2013 due to the explosion of e-commerce.

Online sales soared 110 percent to 1.1 trillion yuan and online-sales growth contributed to 82.7 percent of sales growth for the 100 retailers, said Wang.

Sales at their physical stores only grew 5.6 percent year on year, he added.

Alibaba's Tmall.com was the largest with an annual sales of 763 billion yuan, while Suning and JD.com ranked the second and third.

Tmall.com ranked top for the second straight year after beating Suning in 2013.

Due to weak sales at physical stores, the threshold for the top 100 retailers fell to 3.56 billion yuan, down by 410 million yuan, said Wang.

 

[Jlaw]

To all the stupids who do not understand how stock market work

 

[TaiShang]

China's export rose by 2.1 percent year-on-year to 1.17 trillion yuan($188.5 billion) in June, a better-than-expected increase after the 6.4 percent decline in April, according to data from Customs released on Monday.

However, the import figure fell by by 6.7 percent to 890.67 billion yuan last month, leading to an accelerated growth of monthly trade surplus to 45 percent year-on-year.

In the first six months, the country's total foreign trade value was 11.53 trillion yuan, down by 6.9 percent from a year earlier. Exports increased by 0.9 percent to 6.57 trillion yuan while imports decreased by 15.5 percent to 4.96 trillion yuan.

China sees exports increase 2% in June, imports decline - People's Daily Online

 

[TaiShang]

"Tibet’s economy has been growing rapidly especially ever since the reform and opening up in the late 1970s. Nominal GDP of Tibet province has climbed from 7.7 RMB billion in 1997 to 60.6 RMB billion in 2011, reflecting a 7.9 times increase over the years."

"Living standards of the Tibetan population has been on a rising trend. Nominal GDP per capita of Tibet province has risen from 3,100 RMB in 1997 to 19,970 RMB in 2011, reflecting a 6.4 times increase over the years. In 2011, the disposable income of the urban residents reached 16,196 RMB - an increase of 8.1% from the previous year, while rural residents’ net income per capita reached 4,904 RMB, up 18.5% from 2010."