China Economy Forum

[gpit]

China, ASEAN Negotiating Trade in RMB | 2point6billion.com - Foreign Direct Investment in Asia

China, ASEAN Negotiating Trade in RMB
Posted on Tuesday, October 25, 2011 by 2point6billion.com

Oct. 25 – China is negotiating with ASEAN countries over settling trade in Chinese renminbi (RMB), Assistant to the Governor of the People’s Bank of China Jin Qi told reporters Saturday in Nanning during the third China-ASEAN Summit Forum on Financial Cooperation and Development.

“It (the agreement) is currently underway, but the exact time for signing the agreement will depend on the negotiation process.” Jin said, adding that ASEAN countries should sign bilateral currency swap agreements with China to boost bilateral financial cooperation.

Jin also called for efforts from China and ASEAN states to improve local currency exchange mechanisms, advance financial openness, as well as to work more closely together to avoid a regional economic crisis.

Currently, the 10 ASEAN states have established over 30 banks and financial institutions in China and, at the same time, Chinese financial enterprises have set up 11 divisions in ASEAN countries.

Statistics showed that in the first half of 2011 China had handled RMB957.57 billion (US$149.62 billion) in cross-border RMB trade, which accounted for 8.6 percent of the country’s total foreign trade during the period.

The RMB-based trade settlement agreement between China and ASEAN is likely to be signed late this year or early 2012, sources said. If the agreement is signed, there will be a significant increase in China-ASEAN economic cooperation in the future, Lian Ping, chief economist at the Chinese Bank of Communications told reporters.

“The U.S. dollar has been the dominant currency in payment and settlement in this region but will certainly become volatile in future,” said Lian. “If a stable currency like the renminbi can play a bigger role in the region, it will be good for both trade and regional financial stability.”

China has already signed bilateral currency swap agreements with three nations from ASEAN, namely Indonesia, Malaysia and Singapore. Malaysian Bank Negara and the People’s Bank of China inked the agreement involving RMB80 billion in February 2009. Last year, Indonesia and Singapore signed bilateral currency swap agreements with China in January and July, respectively.

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WOW! look at the money ... Looks like China's soft power is in play. It will definitely hamper Vietnam, the Philippines' anti-China intention/activities.

 

[gpit]

...

Guess what friends, I'm moving my core business to China now, and this is going to be my last week in the U.K, in the future U.K will be the places for me to spend holidays but not the 'dream land' of opportunities and fortune``

Just curious, and if you don't mind disclosing it in public, what is your industry/product(s)?

 

[marshall]

Guess what friends, I'm moving my core business to China now, and this is going to be my last week in the U.K, in the future U.K will be the places for me to spend holidays but not the 'dream land' of opportunities and fortune``

Just curious, and if you don't mind disclosing it in public, what is your industry/product(s)?

I was wondering exactly the same thing. I can't think of anything in the UK that would conjure up something remotely resembling a "dream land" of opportunity and fortune. The USA, maybe 3 or more decades ago, but the UK?

 

[oct605032048]

UK use to be a NLCC, translated as nice little cold country.

 

[rcrmj]

Just curious, and if you don't mind disclosing it in public, what is your industry/product(s)?

I am in Luxury industry``might tell you guys more in the future``lol

so basically my 'nose' is following places where have a long term high disposable money group and GROWING`

 

[bandit]

[B“The U.S. dollar has been the dominant currency in payment and settlement in this region but will certainly become volatile in future,” said Lian. “If a stable currency like the renminbi can play a bigger role in the region, it will be good for both trade and regional financial stability.”
[/IMG]


WOW! look at the money ... Looks like China's soft power is in play. It will definitely hamper Vietnam, the Philippines' anti-China intention/activities.

The money sure looks nice, what is confusing is the writers core reason for using renminbi.

Citing Dollar as too volatile and renminbi as stable? Did the economist just forget that yuan is pegged to the dollar. How can China declare its curency as stable when its tied to an unstable currency. Unless China can unpeg its currency from the dollar which is highly unlikely given its past actions, why would anyone switch to yuan for reasons of stability over the dollar is beyond me.

 

[oct605032048]

List of cities' GDP of Q1 to Q3
unit: 100 million Yuan

 

[SpArK]

India-China Trade to Touch $100 Bn in 4 Yrs: Assocham

India-China trade would touch USD 100 billion in the next four years from the present USD 63 billion, says industry body Assocham.

As per the Associated Chambers of Commerce and Industry of India, the two Asian giants can emerge as world's largest trading partners by 2030.

"China has already raced past United States, Britain and Japan to become India's largest trading partner. Indian companies can gain substantially by accessing Chinese capital goods at attractive prices by way of imports," Assocham said in a statement here.

Indian exports to China jumped 68.8 per cent to USD 19.6 billion in 2010-11, from USD 11.6 billion in the previous year. Imports increased 41 per cent to USD 43.5 billion from USD 30.8 billion in the same period.

India is the tenth largest trade partner of China, and its seventh largest export market. In India's total trade, China's share has increased to over 10 per cent.

However, Assocham expects that government's proposal to hike tariff and non-tariff barriers on imports of some Chinese goods or to impose a complete ban on items like power and telecom equipment will send negative signals to India's trade partners and affect investment climate in key sectors.

"Economic relations between India and China are among the most significant in current global economic scenario," Assocham Secretary General D S Rawat said in the statement, adding that the trade gap must come down.

"Indian companies must widen product portfolio to increase exports of finished, value-added products," he said.

India and China entered a trade agreement in 1984, granting each other the status of Most Favoured Nation (MFN).

"There are complementarities as India has excelled in services sector, especially in knowledge-based services, while manufacturing has emerged as mainstay of Chinese economy," Rawat said.

Indian exports to China mainly consist of metals, ores, iron and steel and cotton, while imports are electrical machinery and equipment, nuclear reactors and boilers, organic chemicals, fertilisers, iron and steel.
FILED ON: NOV 07, 2011

news.outlookindia.com | India-China Trade to Touch $100 Bn in 4 Yrs: Assocham

 

[monitor]

The China paradox: communist capitalism?
on November 7, 2011
By John Yemma

It wasn’t the most charming example of “Chinglish” I’ve seen. It didn’t hold a candle to delightfully mystifying phrases like “Far Out But Classic” or “Show Mercy to the Slender Grass.” But the words I saw stenciled over and over again on concrete fences outside Shanghai, China, in the mid-1990s seemed to capture the Chinese spirit:
“Praise profit. Praise profit. Praise profit. Praise profit. Praise profit.”

The same nation that Mao Zedong had exhorted only two decades earlier to “Practice Marxism and not Revisionism” was being commanded into full-throated pursuit of capitalism.

China is the wonder of the age. If you were around in the 1960s, the China you knew was both tragedy and threat. Every few decades it seemed to devour itself. Millions died in Mao’s Great Leap Forward. Millions during his Cultural Revolution. Heavy-handed propaganda skewered capitalists, imperialists, and the always handy “running-dog lackeys.”

Then came one of the most astounding turnarounds in history. In the same way that communist leaders once ordered the proletariat to build a socialist workers’ paradise, the Communist Party ordered millions of Chinese to go out and make money. The Chinese people didn’t look back. China became the hottest economy on the planet. Its exports are ubiquitous. Its appetite for raw materials enormous. China finances a big chunk of the US national debt. Increasingly, Europe is looking to it for help with its debt. Chinese dealmakers can be found in remote parts of Africa, Manhattan, and the Amazon.

At home, the Chinese people are growing in material wealth, creature comforts, education, even physical stature thanks to higher protein consumption. China’s rise has been a material blessing to millions of its people. What China wants most is for nothing ever to change – for growth to continue and prosperity to increase. For despite its remarkable economic progress, China has 500 million citizens who still make less than $2 a day. If the Chinese economy ceases to grow, those 500 million will be stuck in poverty. A mild slowdown could return millions to poverty as well.

But as with Japan in the 1980s or the United States in the first decade of the 21st century, China is by no means guaranteed continued good times. Some elements of the Chinese boom are looking like a bubble. Vacant malls, excess factory capacity, and ghost cities are plentiful. Five of the 10 largest office buildings under construction globally are in China.

Everything China has done over the past six decades has been massive – a massive attempt to create a communist society and now a massive effort in pursuit of profit. This is not a nation reflecting the will of its people. It is a government command center telling its people what to do. Right now, that looks like a shiny, happy world of capitalism. Less than 50 years ago, it was a mad world of little red books, ruinous five-year plans, and socialist conformity.

If the current freedom to choose consumer goods becomes an expectation of free speech or self-government, the command center is in trouble. That is why China’s rulers imprison dissidents, monitor and regulate Internet usage, and control what is said on TV and in the press. While the Communist Party is more lenient than it was during Mao’s day, it is still careful not to let anything challenge its authority.

You won’t see the party exhorting the people to praise freedom. But if China is to become a balanced culture rather than one swinging between extremes, it must allow democracy alongside material well-being. To pull that off would be a real cultural revolution and a genuinely great leap forward.

John Yemma is the editor of The Christian Science Monitor.

Source: Christian Science Monitor

 

[oct605032048]

Odd. What's wrong with this Christian Science Monitor about Capitalism in China?

 

[no_name]

deleted, unnecessary quip.

 

[Nomenclature]

China Investigates 2 Broadband Companies
By DAVID BARBOZA
Published: November 9, 2011
SHANGHAI — In a rare move, China’s state economic planning agency said Wednesday that it was investigating whether two of the country’s biggest state-run telecommunications companies were engaging in monopolistic behavior and overcharging consumers for broadband Internet service.

The National Development and Reform Commission said that it was looking at China Telecom and China Unicom, the country’s largest fixed-line operators, to see whether the companies were complying with a three-year-old antimonopoly law.

Consumers have complained for years that the companies charge high prices while delivering relatively slow speeds for broadband services.

The investigation is unusual because large segments of China’s fast-growing economy are still controlled by state-owned corporations that act as oligopolies, often reaping large profits with the aid of government subsidies and rules that result in only minimal competition.

Worried that the public is growing impatient with hugely profitable state-backed entities during a time of rising inflation, the government’s state planning agency is striking a more consumer-friendly tone, analysts say.

Li Qing, the deputy director of the bureau of price monitoring and antimonopolization at the National Development and Reform Commission, said that this year the agency began looking into whether the two companies were abusing their strong position in the broadband service market. She said that their broadband revenues were together more than $10 billion last year.

“More than two-thirds of the market’s businesses belong to Telecom and Unicom, so there is no doubt that they can dominate the whole market,” she said, according to the state-run news media.

Just over a month ago, a state-run newspaper reported that China Telecom might come under scrutiny under the nation’s antimonopoly law following complaints from smaller Internet service providers that they were being charged extraordinarily high prices for connecting to China Telecom’s network for broadband service.

Zhang Bin, a telecommunications expert at the Beijing University of Posts and Telecommunications, said in an interview Wednesday that the government had tried to create competition in the industry by dividing it up into a few large players. But the result continues to be high prices and monopolistic behavior.

“This monopoly is not new,” he said in a telephone interview. “It has existed in China’s broadband service for quite a while. And it’s absolutely necessary for the government to take these measures against it.”

Shares of the Hong Kong-listed arms of the two telecommunications giants fell sharply Wednesday on the Hong Kong Stock Exchange after news of the investigation was broadcast on China Central Television, the state-controlled broadcaster.

http://www.nytimes.com/2011/11/10/business/global/china-investigates-2-broadband-companies.html


I have to say I'm becoming more and more impressed with what the government is doing. First Wen continued policies to depress real estate prices and told property developers to **** off. Now NDRC is taking on the big 2 telecom companies. Internet connection is outrageously expansive in China. In Beijing one have pay $200-300 a year to for a ADSL connection. China will have far more than the current 500 million Internet users if those two telecom stop their anti-competitive practices.

 

[oct605032048]

Huawei leads top 500 Chinese private firms 2010
Updated: 2011-08-26 09:10

(Xinhua)
Comments(1) Print Mail Large Medium Small
0
BEIJING-- Huawei, a leading information and communication technology solutions provider based in the southern city of Shenzhen, ranked first among China's top 500 non-State owned firms in 2010 with a business revenue of 185.2 billion yuan ($28.9 billion), a survey released Thursday shows.
The 500 private companies, with 329 in manufacturing and many located in eastern China's Zhejiang and Jiangsu provinces, gained an average business revenue of 13.97 billion yuan last year, up 47.5 percent year-on-year, according to the annual survey released by the All-China Federation of Industry and Commerce.
Their average assets reached 11.77 billion yuan, up 50.9 percent year-on-year; their average net profits increased by 79.5 percent to 782 million yuan last year, according to the survey.
Both based in Jiangsu, Shagang Group in the steel business and Suning Appliance, a leading home appliance retail chain, respectively ranked second and third on the list.
The list was based on a survey conducted by the federation involving the country's private companies whose business revenue in 2010 surpassed 300 million yuan.

 

[CommonCause]

Can people here explain how state owned companies work in China?

I always thought that SOCs worked on behalf of the government, and in turn, the people. That they would take projects that benefit the people, even if the profits weren't there, even at a loss. That they're funding would come from the government, through taxes from the people. I thought that was why all the large corporations in the large industries in China were state-owned, to make it easier to carry out the government's goals for the country.

If SOCs work just like any other company where the goal is to maximize profit for the shareholders (majority owned by the government), then what's the point of the state owning it? For example, the story 2 posts up about alleged monopoly in the telecom companies. If the companies are SOCs, why does monopoly matter? Can't the government come in and control prices? Find out the cost of maintaining everything, maybe some profit for R&D and expansion (though that should also come from government revenue), and then charge customers accordingly. Why do they have to "crack down" on something they own? Just make policies beforehand.

Companies sell shares to the public to raise capital. Why would SOCs need to do this when their funding can come from the government? If the SOC isn't beholden to any private interests to make a profit, they can be more flexible in the ventures they pursue. Any and all profits can then go back to the government to be spent back into the country.

Or am I misunderstanding?

 

[Nomenclature]

Can people here explain how state owned companies work in China?

I always thought that SOCs worked on behalf of the government, and in turn, the people. That they would take projects that benefit the people, even if the profits weren't there, even at a loss. That they're funding would come from the government, through taxes from the people. I thought that was why all the large corporations in the large industries in China were state-owned, to make it easier to carry out the government's goals for the country.

If SOCs work just like any other company where the goal is to maximize profit for the shareholders (majority owned by the government), then what's the point of the state owning it? For example, the story 2 posts up about alleged monopoly in the telecom companies. If the companies are SOCs, why does monopoly matter? Can't the government come in and control prices? Find out the cost of maintaining everything, maybe some profit for R&D and expansion (though that should also come from government revenue), and then charge customers accordingly. Why do they have to "crack down" on something they own? Just make policies beforehand.

Companies sell shares to the public to raise capital. Why would SOCs need to do this when their funding can come from the government? If the SOC isn't beholden to any private interests to make a profit, they can be more flexible in the ventures they pursue. Any and all profits can then go back to the government to be spent back into the country.

Or am I misunderstanding?

State-owned companies in China are generally supposed to make profits. Sometimes they have public policy functions at odds with profitability, but these are exceptions rather than the rule. In fact 5 of the world's 20 most profitable companies are Chinese state-owned companies.
Global 500 2011: Top Performers - Most Profitable Companies: Profits - FORTUNE on CNNMoney.com

Most of the bigger Chinese SOEs are listed companies with up to 30% private ownership. The point of partial private ownership is mostly to improve corporate governance, however about 10 years ago there was a major crisis where smaller state owned companies going out of business leaving tens of millions of employees without a job. Proceedings of selling state-owned shares of big SOEs helped the government to clear up the mess with other unprofitable SOEs.

Why the government is not simply telling the two telecom companies to drop prices? Because that will undermine the authority of executives at those companies which is at odds with aim of improving corporate governance. Also pricing in telecom industry greatly varies from city to city and town to town, price control is simply impractical.

There's another things to have in mind. The agency in charge of macroeconomic policy, NDRC, which initiated this anti-monopoly probe is separate from SASAC, the agency which acts as the majority shareholder in State-owned companies on behalf of the government.