Rules on local govt debts to be rewritten |Policy and Regulation |chinadaily.com.cn The Ministry of Finance has begun drafting rules for local governments’ debt regime, a task that is expected to be completed no late than the end of next year.
Having a system to match local government debt – which could increase by 30 trillion yuan ($4.9 trillion) from now to 2020 – with development needs is an indispensable part of the national program to speed urbanization, according to financial specialists close to the ministry.
China’s VAT Reform Creates Unequal Tax Treatment for Domestic and Foreign Shipping Companies | China Briefing News Under the previous BT regime and the regional VAT pilot program, freight forwarders were allowed to deduct international freight from their taxable income. However, under Circular 37, this deduction is no longer permitted. Instead, starting from August 1, 2013, they are required to pay 6 percent VAT and local surcharges (including urban maintenance and construction tax, education levy and local education levy) on gross proceeds collected from clients.
Genetically modified crops: Food fight | The Economist OF THE many thousands of usually small protests that break out in China every year, few relate to national policy. Many consider the risk of challenging the central government too great. But the entrance to the agriculture ministry is a gathering spot for occasional demonstrations. Their complaints are about an issue dear to the ministry: genetically modified (GM) crops. At one protest this year, a group chanted slogans calling for the eradication of “traitors” who support GM food. Debate over the technology is escalating, putting the government in a bind.
China raises retail oil prices – People’s Daily Online The adjustment, following a rise on Nov. 29, will see the benchmark retail price of gasoline increase by 0.04 yuan per liter and that of diesel rise by 0.05 yuan per liter, the National Development and Reform Commission said.
Hot money distorts China’s exports as speculators seek to cash in on yuan, rate reforms | Reuters November exports rose 12.7 percent on-year, blowing past a Reuters poll that predicted 7.1 percent growth, but many analysts suspect the performance was inflated by speculators moving money into the country through fake trade transactions.
Nomura economist Zhang Zhiwei pointed out in an email to clients that China’s export growth far exceeded that of its Asian neighbors in November, which is unusual.
At the same time, imports grew less than expected and factory output slightly underperformed expectations; all three together form a combination analysts find highly suspicious.
Officials face rating on loans |Markets |chinadaily.com.cn In a recent announcement by the Organization Department of the Communist Party of China, the ruling party said it will abandon the “GDP ranking” system among provinces, counties and prefectures, which put considerable pressure on local officials, prompting them to relentlessly pursue large investments at the cost of environmental degradation and debt buildup.
Will some cities simply fade away? | McKinsey China This flow leaves the proportion of the population that is working age (15-64) in the areas of outflow at 70%, ten points lower than areas of inflow. And those that choose to stay have significantly lower educational achievement. Among other things, this makes it harder for companies to justify investing in production under the “Go West” imperative. Yes, Chengdu in particular is a stand out beacon of growth and development, but local markets in many smaller towns and cities are potentially shrinking; certainly not growing at the national average. Qualified talent – even if it is cheaper – is less and less readily available.
What’s the root of Chinese entrepreneurs lack of creativity? **I agree with the entrepreneurs – I see lots of creativity and drive, but there isn’t the financial backing** But local Chinese entrepreneurs that I’ve spoken with often sing quite a different tune. Rarely do they cite their education or societal preference for financial security as the roots of non-creativity. In fact, many of them argue Chinese entrepreneurs are equally as creative as their western counterparts. The difference is that those truly creative people don’t receive investment or support. The real reason we seldom see disruptive startups coming out of China’s woodwork lies with the venture capitalists and angel investors, who favor startups that use tried-and-tested western models adapted for local markets. As a result, outsiders often only see the copies.
KPMG: Turned Over China Documents to U.S. Regulators – WSJ.com **This isn’t just about accounting, but sovereignty and information flows** The handover is part of a U.S.-China deal reached in May that allows the U.S. access to audit firms’ documents about their Chinese clients, conveyed to the U.S. through Chinese regulators. The agreement was a step toward resolving a standoff over how much China will cooperate with U.S. efforts to oversee Chinese companies, though the pact was nonbinding and didn’t give the U.S. broader access to information it wanted.
Lawsuit accuses IBM of hiding China risks amid NSA spy scandal | Reuters IBM Corp has been sued by a shareholder who accused it of concealing how its ties to what became a major U.S. spying scandal reduced business in China and ultimately caused its market value to plunge more than $12 billion.
IBM lobbied Congress hard to pass a law letting it share personal data of customers in China and elsewhere with the U.S. National Security Agency, in a bid to protect its intellectual property rights, according to a complaint filed in the U.S. District Court in Manhattan.
China Takes Aim at Officials’ Housing Perks – China Real Time Report – WSJ For example, it is widely known in party circles that some officials were renting their government-financed residences to private tenants and then pocketing the proceeds. These “remote officials” were not only supplementing their salaries by such practices, but also often residing in housing provided by local businessmen, who then sought political favors in exchange for that high-end lodging.
US trade with China seen rising – BUSINESS – Globaltimes.cn **As EU trade decreases in importance, may see more EU actions on Chinese human rights. Note reference to “frictions”** The US may overtake the European Union (EU) to become China’s largest trade partner this year, Wei Jianguo, former vice minister of commerce, forecast on Wednesday.
The prediction is based on the robust economic recovery in the US and trade frictions between China and the EU, Wei told a forum held by the China Chamber of International Commerce in Beijing.
Shanghai’s FTZ to see further reforms – People’s Daily Online China will improve the negative list for foreign investment and ensure operational financial rules for Shanghai’s pilot free trade zone next year, the city’s Vice Mayor Ai Baojun said yesterday.
“Shanghai is aiming to build an international-level free trade zone after two to three years of experiment, which will facilitate trade and investment and allow free exchange of currency in a well-regulated environment,” Ai, who also heads the zone’s management committee, said in a statement.
Guangdong to prioritize 4G mobile networks |Industries |chinadaily.com.cn Guangdong, which is the largest provincial economy in the country, will promote 4G broadband applications with a view to improving performance and productivity.
The improvements will include upgrading manufacturing, public services and the management of government services, Zou said during a press conference. The electronic information industry of the province will receive a boost, he said.
China Orders Pilots to ‘Land Blind’ as Smog Delays Flights – Bloomberg **Oh god** Pilots flying to Beijing’s international airport from the nation’s 10 busiest airports must be qualified to land when visibility falls below 400 meters, starting from Jan. 1, the official China Daily said, citing unidentified people at the Civil Aviation Administration of China. The new requirement, translated as “level two blind landing,” uses radio beam transmitters to guide planes when pilots have difficulty seeing, according to the Xinhua News Agency.
The Big Churn — How High Partner Turnover Damages China’s Private Equity Industry | China Private Equity, Published by China First Capital What’s the biggest risk in China private equity investing? Depends who you’re asking. If you ask LPs, the people who provide all the money that PE firms live off, you will often hear a surprising answer: turnover at PE firms. Nowhere else in the PE and VC world do you find so many firms where partners are feuding, quitting or being thrown off the bus.
Banking system able to absorb market shocks – BUSINESS – Globaltimes.cn **Could work out one of two ways? Either govt helps state-owned banks transition, or they are left to market** For traditional players in China’s financial services industry, most of the bumps ahead are likely to come in the shape of expanding market reforms. According to documents published in official media outlets following the recent Third Plenary Session of the 18th Communist Party of China Central Committee, the central government has made it clear that it wants to see the market gain more sway over the allocation of resources, including capital and bank credit.
China Mobile Gives $919 Discount on Samsung and Sony 4G Handsets – Bloomberg In a marketing blitz on billboards at bus stops and subway stations across Beijing, the Samsung, Sony and HTC devices are all prominently featured. Domestic vendors in China Mobile’s first wave of 4G handsets include ZTE Corp. (763), Huawei Technologies Co., and the Coolpad brand of China Wireless Technologies Ltd.
China Mobile’s iPhone 5S Preorders Surpass 25,000 on First Day Preorders for Apple’s (NASDAQ:AAPL) iPhone 5S through a new China Mobile (NYSE:CHL) iPhone page have already exceeded 25,000 barely 12 hours after the page was first activated. As previously reported by Apple Insider, the page appears to have been launched sometime before 1 p.m. local time in Beijing. Soon afterwards, Apple Insider posted a screenshot of the iPhone 5S preorder page that showed over 3,000 customers had already visited China Mobile’s new iPhone landing page. Now, approximately 14 hours later, the counter is fast approaching 26,000.
Chinese Subscribers Don’t Have Number Portability Which Leads To Pent Up iPhone Demand At China Mobile – Forbes I received a comment on one of my Forbes posts that Chinese subscribers can not transfer their phone number between carriers so the availability of the iPhone is making at least this one subscriber very happy (and I suspect millions of others). There was also an article from the South China Morning Post on August 5, 2013, that talks about the Chinese market not having number portability until 2015 at the earliest. The author of the article says he is a China Mobile customer and has not switched due to the hassles that come with changing to a new phone number.
Shanghai SOEs to merge amid reform drive – BUSINESS – Globaltimes.cn Shanghai Lansheng Corporation said Thursday that it will merge with Shanghai Eastbest International (Group) Co. The Shanghai branch of the State-owned Assets Supervision and Administration Commission (SASAC) will transfer all of its holdings in Lansheng to Eastbest International, which is also controlled by the commission.
ICBC, Ping An Picked for China Option Trading, News Says – Bloomberg China has selected Industrial & Commercial Bank of China Ltd., Ping An Insurance (Group) Co., PetroChina Co. and Kweichow Moutai Co. as the first stocks in mock options trading, the Shanghai Securities News reported.
Investors will also be able to buy and sell options on two exchange-traded funds that track the 50 and 180 biggest yuan-denominated stocks in the Shanghai Stock Exchange
, the newspaper reported, citing unidentified brokerages. The Shanghai Securities News is operated by the official Xinhua News Agency.
Peugeot takes writedown, gets GM’s backing for Dongfeng deal | Reuters PSA Peugeot Citroen said on Thursday it took a 1.1 billion euro ($1.52 billion) writedown at its ailing overseas operations and is pursuing a tie-up with China’s Dongfeng Motor Group that would give the French carmaker the time and cash to pull out of its downward spiral.
Separately, U.S. alliance partner General Motors Co announced the sale of its 7-percent Peugeot stake and said it would not stand in the way of a deal with Dongfeng, insisting that industrial cooperation with Peugeot remains strong.
Taxi Apps DidiDache and KuaidiDache Buddy Up with OTA Ctrip for Larger User Base DidiDache and KuaidiDache, two leading domestic taxi apps, join hands with OTA Ctrip to embed their services in the newly launched 5.2 version of Ctrip’s mobile app (report in Chinese).
What Chinese Shopped on Alibaba Marketplaces in 2013 Alibaba released a report on Alibaba Group’s Taobao Marketplace, Tmall and group-buying service Juhuasuan this year. Here are some interesting findings from the Alibaba report,
Boosted by WeChat, China’s mobile gaming market worth $590M in Q3
Why the sudden burst? After all, smartphones are common in China
and have been for a few years already in this pretty mature phone market. iResearch believes that the popular messaging app WeChat
is to thank for this mobile gaming explosion, due to the social gaming center that Tencent
(HKG:0700), WeChat’s makers, integrated into the app this summer
Yunnan Tin to Buy Chinese Iron-Ore Mines for $155 Million – Bloomberg China Yunnan Tin Minerals Group Co. (263), a Hong Kong-based mining company, said it plans to buy two open-cut iron-ore mines for HK$1.2 billion ($155 million) after one of its facilities was forced to close after an accident.
The company will pay HK$690 million cash, 1.05 billion new shares and HK$300 million of five-year zero-coupon convertible bonds to Mega Marks Ltd., owner of the mines and an ore-processing plant in western China’s Xinjiang region, according to a Hong Kong stock exchange filing yesterday evening.
Online literature site Cloudary CEO resigns – BUSINESS – Globaltimes.cn Hou Xiaoqiang, CEO of Cloudary Corporation, a Chinese online media company that publishes literature works online, resigned from the position, Hou announced Thursday on his Weibo account.
Hou attributed his resignation to health problems but said he will still be a senior consultant for Cloudary.
Posted from Diigo.