China Business Briefs 21/12/13

ECONOMY

Chinese Interest Rates in Money Markets Jump on Friday – WSJ.com **Amazing to see what tight margins the banks operate under – any increase in lending rates and they scream** The situation worsened Friday as the interest rate banks charge each other for short-term loans jumped to 8.2%, the highest level since a crippling liquidity shortage in the summer. The stress in the banking system is starting to spread: Stocks in Shanghai fell for a ninth consecutive day to the weakest level in four months, while government bonds dropped, pushing the 10-yield near to its highest level in eight years.

The People’s Bank of China issued its second statement about the developments in two days, saying it had injected a total of 300 billion yuan ($49.4 billion) into the financial system over the previous three days.

Video: China’s Banking System in Claymation – China Real Time Report – WSJ **Very cool** China’s leaders are well aware that there’s too much infrastructure spending and too little spending by consumers, and they’re trying to “rebalance” the economy by easing interest rates and adding deposit insurance. Ken Brown explains China’s financial system—with some help from claymation.

@PBOC: Nice work on the social media ploy | China Economic Review Governors at the People’s Bank of China have stepped up their social media game as of late. For days they’ve been posting cute cat photos on Weibo, China’s answer to Twitter (which is blocked in China). That wasn’t gaining much traction, with only the suits at the ministries of finance and commerce re-posting the furry felines.

That’s probably why PBOC late on Thursday announced on its Weibo account that it pumped billions of yuan into China’s monetary system via short-term liquidity operations, or SLOs. You see, central bank rules say that SLOs must be announced a month after they are conducted. But PBOC just couldn’t wait that long to generate a storm in the social media universe.

China’s lenders in push to lure depositors |Markets |chinadaily.com.cn Lenders, especially smaller banks, are raising the returns on their wealth management products in a bid to attract depositors.

In the last week of November, a total of 423 wealth management products hit the market with an average promised annualized return of 5.3 percent, the Beijing Evening News reported. That figure was up 0.13 percentage point from the previous week and compares with 4.47 percent for the same period last year.

Tech bans to be relaxed: US – Chinadaily.com.cn The United States said on Friday it will “actively” carry out a plan to lift bans on high-tech exports to China, a long-term irritant in economic ties between the world’s two largest economies.

The development is a sign that recent military and trade friction will not deter the two nations from steadily advancing their economic relations, experts said.

China Ministry of Finance Official Praises U.S. Federal Reserve Move to Wind Down Bond-Buying – China Real Time Report – WSJ Many emerging markets have worried that the Fed’s efforts could reduce investment flows into their nations as investors looked more favorably at a recovering U.S. economy. But China’s central bank is far less worried and may welcome such an outcome, some Chinese and U.S. economists say.

Chinese tycoons top list of Britain’s richest property investors | South China Morning Post **London property has become a global asset, much to Londoner’s dismay** Tycoons from China have come from nowhere to top the list of the UK’s wealthiest property investors for the first time, ending the Duke of Westminster’s 10-year reign at the No1 spot.

China’s richest man, Wang Jianlin of the Dalian Wanda group, topped the 2013 Estates Gazette Rich List with an estimated fortune of £10.4 billion (HK$131 billion), closely followed in the No2 spot by New World Development chairman Henry Cheng Kar-shun and his family at £10.2 billion.

Video: Christmas 2013: Inside a Chinese toy factory – Telegraph Malcolm Moore visits the Atopp toy factory in Shantou, finding remote control helicopters and harmony.

Chinese Leader Xi Weakens Role of Beijing’s No. 2 – WSJ.com **Cameron’s obsequious behaviour is designed to put UK ahead of EU partners in China trade – China/EU trade is still limited** British officials were finalizing details of Prime Minister David Cameron‘s visit this month to Beijing when they received a last-minute scheduling change: President Xi Jinping would host a banquet in Mr. Cameron’s honor.

The invitation, which delighted the British officials, effectively scrubbed dinner plans with Mr. Cameron’s official host, Premier Li Keqiang. And it illustrates an important shift in the Chinese leadership’s internal dynamics: Mr. Xi is downgrading the premier’s role and assuming the primary duty of overseeing economic reforms as well as briefing foreign leaders on economic affairs, Communist Party insiders say.

China to make new bid to join global procurement pact in 2014 | Reuters **Colour me sceptical** China has agreed to make a revised offer to join a global agreement aimed at creating a level playing field for foreign companies competing for government contracts, senior U.S. and Chinese officials said on Friday.

Lack of access has been a sticking point with trade partners since China joined the World Trade Organisation (WTO) 12 years ago.

If China were to join the Agreement on Government Procurement (GPA), it would potentially open $100 billion of government contracts to foreign competition every year, and offer opportunities ranging from building highways to running data networks.

Elite Talk: A talk with former US Undersecretary of Treasury on China’s currency reform – People’s Daily Online How to see the yuan’s substantial appreciation? Is the Chinese currency really a one-way bet upward?

Joining the Elite Talk program to talk about these sizzling hot topics is former US Undersecretary of Treasury Mr. Timothy Adams. While at the White House, he was the George W. Bush administration’s point person on international financial and economic issues, including exchange rate policy issues. He has regularly interacted with top-ranking officials in key emerging markets including China and traveled extensively throughout the world’s second-largest economy. Here’s our talk.

Organization of Firms in P2P Lending Publishes Standards for Entering Industry – An organization of companies involved in peer-to-peer lending and information providers has published a set of standards that mark an attempt to set requirements for establishing P2P firms.

The requirements cover a range of items, from the credentials of employees and a company’s information disclosure to risk controls and the use and custody of client money.

Chinese factory manager from Hong Kong walks daily tightrope | South China Morning Post **Good insight into the control necessary with staff** “You want to make sure not a single area is dominating,” he said. “It’s not about those much-reported gang fights, but the loss of control if you have too many from one province.”

People from the same area tend to gang up, and not just because of differences in dialect and culture. Real interests can be at stake.

China, US start annual trade talks |Economy |chinadaily.com.cn Annual trade talks between China and the United States started on Friday in an effort to address trade frictions and build a foundation for the new model of major-power relations between the world’s two biggest economies.

China promises to promote US beef imports | South China Morning Post A Chinese deputy commerce minister, Wang Chao, said at a news conference the two sides agreed to “promote US beef exports to China” but gave no details. A deputy agriculture ministry, Niu Dun, said the two sides will work on technical issues but gave no timetable for when full-scale imports might be allowed.

Beijing banned US beef in 2003 due to fears of mad cow disease. It has promised in recent years to ease those restrictions but effectively maintained its ban.

COMPANIES

Treasure piles up for Alibaba as depositors desert China’s banks – FT.com **Savers desperately seeking returns** Li Mingyang only joined Alibaba’s investment platform one month ago but he has already transferred almost all the cash in his bank account – nearly Rmb200,000 ($32,000) – to the online fund.

He is far from alone. More than 30m people in China have signed up to Yu’E Bao, or “Leftover Treasure”, only six months since its launch.

Why Tencent’s Investment In Cyanogen Inc Matters Now, Tencent (HKG:0700) is no stranger to investing in software companies based outside of China. In the past year or two, the company has injected cash into Fab.com, Snapchat, Kakao Talk, and a handful of small, Silicon Valley startups.

But the CyanogenMod investment stands out because it’s an operating system – specifically, one that appears to aspire to compete with Android (even though it remains a fork for the time being).

Appliance Retailers Run an Online Marathon, Uphill – Indeed, it’s been an uphill race ever since Gome Electrical Appliances Holding Ltd. and Suning Commerce Group Co. Ltd. decided in around 2009 to gradually migrate business from traditional storefronts to online retailing.

Each company has invested heavily in e-commerce, but both have fought for their online stores, which sell consumer electronics, household appliances and related wares. Gome’s online unit lost about 400 million yuan in the first three quarters of 2013, the company said, bleeding slightly less red ink than in the same period 2012. Although Suning didn’t release profit figures of its e-commerce business, the company reported a 73 percent year-on-year decline in total net profit for the first three quarters. The company said with the rising online sales and the company’s effort to unify prices of its online and offline stores, Suning’s gross profit margin declined 3.48 percentage points to 15.2 percent for the first quarters compared to the same period last year.

Chinese firm to acquire Plaza Construction – Business – MiamiHerald.com Plaza Construction, a major New York-based construction management firm that is prominent in South Florida and the mid-Atlantic region, said its stock will be acquired by China Construction America Inc..

CCA is a unit of state-owned China State Construction Engineering Corp., based in Beijing, China.

China to become centre for ‘various disruptive changes’ in business as its digital, mobile and tech sectors grow, claims WPP’s Sir Martin Sorrell | The Drum The research, published by WPP and conducted by research firm Millward Brown, reports on China’s most valuable brands, this year listing the top 100 for the first time, rather than the regular top 50 brands.

Top of the list was China Mobile at $61.4bn, followed by Industrial & Commercial Bank of China at $39.7bn and then Tencent at $33.9bn.

Bank of China Limited : Chinese Liquidity to Remain Tight in 2014 | 4-Traders **Plus how much bad debt?** Next year will see further liberalization in China’s banking system, but financing conditions will likely remain tight, Bank of China said on Friday in a report detailing its outlook for 2014.

Liquidity will remain tight for China’s financial institutions next year thanks to a combination of an increasingly vigilant stance by the central bank and the “tapering” of quantitative easing in the U.S., the bank said.

China Everbright Bank Shares Fall on Debut – WSJ.com Everbright priced its IPO at HK$3.98, near the middle of its indicated price range, but still increased its fundraising to US$3 billion last week by selling additional shares, from an original base deal worth US$2.6 billion.

Yet, as trade opened Friday, China’s 11th largest lender by assets saw its shares fall 0.5% below the IPO price of HK$3.98. Everbright Bank shares fell as much as 5% intraday before closing at HK$3.87, down 2.8% from their Hong Kong IPO price, underperforming the benchmark Hang Seng Index, which ended down 0.3% at 22,812.

Hershey hits sweet spot with deal for Golden Monkey |Companies |chinadaily.com.cn The Hershey Co, North America’s largest quality chocolate producer, has announced plans to acquire 80 percent of snack producer Shanghai Golden Monkey Food Joint Stock Co Ltd.

The acquisition will be carried out through Hershey Netherlands BV, a wholly owned subsidiary. It’s expected to be completed in the second quarter of next year, subject to approval from Chinese regulators and shareholders.

Analyst: Here’s Why the Apple-China Mobile Partnership Has Been Delayed Did Apple’s (NASDAQ:AAPL) distribution deal negotiations with China Mobile (NYSE:CHL) hit a snag over declining sales of the iPhone 5C? According to a note to investors obtained by Apple Insider, KGI Securities analyst Ming-Chi Kuo attributed the distribution deal delay to the unexpectedly low sales of Apple’s mid-range smartphone.

Spy Shots | BaoJun’s First Minivan Revealed | China Car Times – China Auto News Baojun is apparently planning to expand its auto range in 2014 with the addition of a new MPV and hatchback to the sole 630 sedan that has kept the GM-Wuling-SAIC made sub brand alive so far. The hatchback has already been sighted testing in China, but the MPV is a new one in such clear conditions.

JinkoSolar Partners with Beijing University to Build the University’s First Experimental PV Plant | 4-Traders JinkoSolar Holding Co., Ltd. (“JinkoSolar” or the “Company”) (NYSE: JKS), a global leader in the solar PV industry, today announced that it will partner with Beijing University’s Solar Power Engineering Center to construct the University’s first experimental PV power plant on campus which will be used for collecting and analyzing data on the power generation capabilities of PV modules when exposed to various conditions.

A place to call its own on the NYSE – BUSINESS – Globaltimes.cn **Um… yeah…** Investors have shown a strong bout of confidence in Autohome, after the Chinese auto information provider went public earlier this month, when the company’s share price soared 76.88 percent the day it was listed on the New York Stock Exchange (NYSE) – in an encouraging sign for the company to work harder to keep their backers happy.

Blacklisted by World Bank!: CHEC refutes PGPL’s claim | Business Recorder China Harbour Engineering Co Ltd (CHEC) has refuted the claim of being blacklisted by the World Bank and has demanded an apology from Pakistan Gasport Limited (PGPL) which had claimed that CHEC is a blacklisted contractor by World Bank and cannot participate in the fast-track LNG tender.

Ministers of Finance &Transport in Beijing  | Sierra Express Media Sierra Leone Ministers of Finance and Economic Development and Transport and Aviation, Dr. Keifala Marah and Leonard Balogun Koroma, respectively on 17th December, arrived in the People’s Republic of China to hold further discussions with EXIM Bank of China and China Railway International on the construction of the Mamamah International Airport Project and the Hunan Rice and rubber agricultural project.

Ineos says most at UK Grangemouth plant agree to terms – Yahoo Singapore Finance **This story has been big in Scotland, but there was no mention of PetroChina’s stake** Ineos is the full owner of the Grangemouth petrochemical plant and a joint owner of the 210,000 barrels-per-day (bpd) refinery along with PetroChina , which holds 49.9 percent.

The company halted operations at Grangemouth in October and demanded changes in terms and conditions before it would permit a restart. It had previously said that losses would force it to shut the petrochemical plant.

Swiss Re buys stake in New China Life – Headlines, features, photo and videos from ecns.cn|china|news|chinanews|ecns|cns Swiss Re is acquiring directly from Zurich Insurance Company 152.9 million New China Life H shares (which are listed on the Stock Exchange of Hong Kong). representing 4.9 percent of the total issued share capital of New China Life (which includes both H shares listed in Hong Kong and A shares listed in Shanghai). The total value of the transaction is HK$3.82 billion ($493 million).

China Life Insurance Company Ltd. (LFC) is Overbought, What’s Next? – Tale of the Tape – NASDAQ.com Investors have definitely seen some solid trading in China Life Insurance Company Ltd. (LFC) lately, leading to gains for some. However, LFC is now in overbought territory thanks to its latest move, as the firm has an RSI value of 76.1. Additionally, China Life Insurance Company Ltd. currently has a Zacks Rank #4 (Sell), so if the earnings estimate trend is any guide, a fall might be coming for this overbought stock.

Peabody, Shenhua form thermal coal joint venture – Pennenergy Peabody Energy (NYSE: BTU) and China’s Shenhua Group announced they have entered into an agreement to create Sino-Pacific Coal Trading Corporation Pte. Ltd., a Singapore-based joint-venture company that will supply Shenhua’s growing coal import demand with thermal coal from Peabody’s global production and coal trading platform.

Market Research Reports, China State Construction Engineering Corporation Ltd (601668) – Financial and Strategic SWOT Analysis Review China State Construction Engineering Corporation Ltd (601668) – Financial and Strategic SWOT Analysis Review provides you an in-depth strategic SWOT analysis of the company’s businesses and operations. The profile has been compiled by GlobalData to bring to you a clear and an unbiased view of the company’s key strengths and weaknesses and the potential opportunities and threats. The profile helps you formulate strategies that augment your business by enabling you to understand your partners, customers and competitors better.

ICBC has Business Focus For First NZ Branch | Stuff.co.nz The country’s newest bank, China’s state-controlled ICBC, says it will focus largely on business banking as it sets up shop in New Zealand.

But the local arm of the world’s biggest bank also intends to branch into commercial property deals, as well as offering retail banking services.

The Zacks Analyst Blog Highlights: China Petroleum and Chemical, Apache, Chevron, SM… — CHICAGO, Nov. 29, 2013 /PRNewswire/ — Reportedly, China Petroleum and Chemical Corporation (NYSE: SNPFree Report) is discussing the purchase of a minor stake in Kitimat liquefied natural-gas (LNG) project with U.S. energy firm Apache Corp. (NYSE: APAFree Report). China Petroleum and Chemical Corporation, also known as Sinopec, is one of the largest petroleum and petrochemical companies in Asia.

Details relating to the purchase have not been disclosed. Moreover, Sinopec’s management has not sanctioned the investment yet. However, a source revealed that Sinopec’s stake investment will be utilized to fund the LNG project.

Shenhua Unit Wins Russia Coal Resources Use Right – Financial and Business News – MENAFN China Shenhua Energy Company Limited (01088) announces that Razrez Ugol, a unit in which the company indirectly holds 50% of equities, gained the resource use right for coal exploration and exploitation at Zashulanskoye Mining Area in Russia through a bidding at RUB 247 million or CNY 45 million.

OilVoice | Green Dragon Gas announces MOU with PetroChina Green Dragon Gas Ltd. (AIM: GDG), one of the largest independent companies involved in the production and sale of CBM gas in China, is pleased to announce that it has entered into a binding Memorandum of Understanding (MOU) with PetroChina Company Ltd (“PetroChina”), regarding confirming the Company’s participating interests in the Chengzhuang block (“GCZ”), a block included within the Shizhuang South (“GSS”) Production Sharing Contract.

Under the MOU, PetroChina will provide all information necessary for the Company to complete an audit so as to conclude and accept the capital expenditures incurred to develop the block, the gas production, gas sales and related revenues. Commercial gas sales began in March 2010. The parties have agreed to conclude the audits and the related definitive agreements on payments in the first quarter of 2014. Furthermore, the parties agreed that PetroChina will continue to be the operator of the GCZ block, while the Company will continue to operate the GSS block.

Posted from Diigo.

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