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China Business Briefs 28/1/14

Sorry about the lack of posts yesterday. Beijing seems to hit my immune system with frequent minor ailments. All a bit wearisome.

ECONOMY

China Credit Trust Says It Reached Pact on Troubled Product – Bloomberg China Credit Trust Co. said it reached an agreement to restructure a high-yield product that sparked concern over the health of the nation’s $1.67 trillion trust industry and contributed to a global selloff in emerging-market assets.

The agreement includes a potential investment in the 3 billion-yuan ($496 million) product, Beijing-based China Credit Trust said on its website today, four days before payment is due. The two-line statement didn’t identify the source of funds, or say whether investors would get their money back.

China shadow bank says reached pact to avoid default – Yahoo Singapore Finance In a notification to investors, obtained by Reuters, the trust firm declared that an accord had been reached and advised investors to contact client managers, but the document, did not say how or when investors would be repaid.

Citing an unnamed investor in the trust product, Caixin, a respected financial magazine, reported on Monday that the agreement allows investors to recover their invested principal, but not the final interest payment originally promised.

China Trust Default Avoided…What Comes Next? – Forbes A default of the “Credit Equals Gold #1” trust product has been avoided. What happens in the coming months will either push China closer towards a financial crisis or help it gradually step back from the edge.

Heard on the Street: China’s Default That Wasn’t – WSJ.com Like clockwork, a mysterious third party has sprung to the rescue, allowing China Credit Trust to repay the principal on high-yield investment products tied to a struggling coal miner. Savers will miss some interest payments and get a lower effective yield, but otherwise escape unharmed. So does the reputation of Industrial and Commercial Bank of China, the country’s largest commercial lender, which sold the trust products to clients.

The hand of the state seems to be at work. Officials in the miner’s home province were actively involved in coming up with a solution, The Wall Street Journal reported. The bailout involves the third-party investor taking an equity stake in the coal company, which came only after the company suddenly gained approval to restart a closed mine.

China’s top diplomat wants free-trade deal with Europe | Reuters Beijing’s top diplomat called on Monday for China and the European Union to consider a multi-billion-dollar free-trade deal, a once unthinkable step that shows a big improvement in relations between two of the world’s largest markets.

“There are bright prospects for China-EU business cooperation,” Chinese State Councillor Yang Jiechi told reporters after meeting EU foreign policy chief Catherine Ashton ahead a visit to Brussels by President Xi Jinping in March.

China Trade Puzzle Revived as Hong Kong Data Diverge – Bloomberg China’s trade numbers, distorted by fake exports (HKETEXPC) last year, are set to come under renewed scrutiny after a discrepancy between Hong Kong and Chinese figures for bilateral trade widened to the largest in eight months.

Hong Kong’s December imports from China fell 1.9 percent from a year earlier to HK$176 billion ($22.7 billion), the city’s statistics department said yesterday. That compares with $38.5 billion in exports to Hong Kong reported earlier this month by China’s customs administration, up 2.3 percent, based on data compiled by Bloomberg.

China Property New Loans Hit $380Bln in 2013, Accounting 1/3 of Total-Caijing China’’s property sector attracted 2.34 trillion yuan (about $384 billion) of new loans in the past year, representing nearly a third of the total from the banking institutions, a central bank report showed.

Outstanding yuan-denominated lending to the property sector from both Chinese and foreign financial institutions to the property sector rose 19.1 percent year-on-year to 14.61 trillion yuan by the end of 2013, the People’s Bank of China said.

Total loans outstanding at commercial banks amounted to 71.9 trillion yuan at the end of December, up 14.1 percent year-on-year and compared with a growth rate of 15.0 percent in the previous year.

Currencies and banks: the two big questions about China | The A-List But in the financial world the Chinese remain a little more hesitant. Two big issues kept recurring, one international, the other domestic:

-will the renminbi soon rival the dollar as a global reserve currency?

-is the rapid growth of shadow banking an accident waiting to happen?

China’s debt-fuelled boom is in danger of turning to bust – FT.com Debate rages over how this tale will end. Most analysts believe that the Chinese economy will once again expand by more than 7 per cent this year, despite ballooning private sector debts. But the pessimistic minority has history on its side. Only five developing countries have had a credit boom nearly as big as China’s. All of them went on to suffer a credit crisis and a major economic slowdown.

Banks see slower growth in assets – Frontpage – BUSINESS – Globaltimes.cn Assets of the banking industry ­totaled 148 trillion yuan ($24 trillion) by the end of 2013, up 12.8 percent from a year earlier, according to data released Sunday by the China Banking Regulatory Commission (CBRC). The growth rate was the lowest since 2003, when the CBRC first started revealing such data.

Banking assets mainly refer to ­financial institutions’ lending assets. Meanwhile, total liabilities reached 137.9 trillion yuan.

Beijing says US should stop new dumping probe on solar cells | South China Morning Post China’s commerce ministry called on the United States on Sunday to stop anti-dumping investigations into imports of solar power products from China, expressing “serious concern” and vowing to defend its producers.

“The Chinese side expresses serious concern,” the commerce ministry said in a statement on its website. “China urges the United States again to carefully handle the current … investigations, be prudent in taking measures and terminate the investigation proceedings.”

Life Insurance in China, Key Trends and Opportunities to 2017 – PR Newswire – The Sacramento Bee The report provides in depth market analysis, information and insights into the Chinese life insurance segment, including: • Benchmarking analysis of the BRICS (Brazil, Russia, India, China and South Africa) countries • The Chinese life insurance segment’s growth prospects by life insurance categories and customer segments • The various distribution channels in the Chinese life insurance segment • The competitive landscape in the Chinese life insurance segment • A description of the life reinsurance segment in China • Detailed analysis of the regulatory framework in China

Oil Companies Using New Logic in Their Overseas Acquisitions – Among mergers and acquisitions of global upstream oil and gas assets over the past few years, one trend has seen European and American companies selling while national oil companies in China and Russia have been buying.

“In 2013, global M&A transactions of upstream oil and gas assets were the lowest since 2008,” said a January report by IHS, an energy consultancy. The report said that from 2010 to 2012, global M&A transactions of upstream assets totaled US$ 600 billion, with 2012 the highest in a decade, at US$ 250 billion. But this fell to US$ 136 billion in 2013.

Capital’s Expensive Plan to Fight Air Pollution Misguided, Expert Says – However, Tao Guangyuan, executive director of the Sino-German Renewable Energy Cooperation Center, said that while the sum shows determination, the government’s approach might be unnecessarily costly. (The center is supported by the governments of China and Germany.)

Much of the 760 billion yuan will go toward converting coal-burning power plants into ones that burn natural gas. Tao says the government will need to invest heavily in equipment and production facilities, but doing this will also create a long-term financial burden because gas is more expensive than coal.

Selling products and Services into China The big issue today is not so much how to make product in China, but how to sell product and services to China, be that within China or from outside China. Needless to say, the “within China” part is where the complicated legal regulations and hence the tensions can arise.

China’s guarantee companies face survival problems amid slowing economy|WantChinaTimes.com Since the second half of 2011, the government’s four trillion stimulus policy began to ebb, followed with a tightening monetary policy and the implementation of macro-economic control. Bad debt from soft government funds exploded from small and medium-sized enterprises, leading to rising pressure on guarantee companies.

Reforms to fuel Shanghai’s growth in 2014 – Xinhua | English.news.cn Economists believe the city’s financial sector is going to grow even more this year, while Shanghai Mayor Yang Xiong estimates the city economy will grow by 7.5 percent. A series of reforms in the landmark Shanghai Free Trade Zone, including changes to capital accounts and interest rates, are expected to add new sources of growth to the financial sector.

Talent returns to China, but progress slow – Business – Chinadaily.com.cn A report on returned overseas talent compiled by Wang found that more than 270,000 people came back in 2012, an increase of 46 percent over 2011, adding that rapid economic development in China is one of the major attractions.

Of those who returned, more than 30 percent took jobs or started a business in areas such as new materials, energy, biotechnology and electronic information.

8.8% salary hikes expected for 2014 – Chinadaily.com.cn Salary increases are expected to hit 8.8 percent in 2014, a slight rise on the 8.6 percent for 2013, according to a survey issued by 51job.com, a human resources service provider.

It found that the highest salary increases occurred in the financial sector, reaching 10.4 percent, followed by real estate (10.1 percent), high tech (9.9 percent) and bio-pharmaceuticals (9.2 percent).

Li reaffirms commitment to social welfare system[1]- Chinadaily.com.cn During his visit, the premier highlighted the importance of social relief work and urged the governments to do a better job in providing basic welfare to disadvantaged people.

“The government has to tighten up the network of social security. A welfare system must be in place for the poor to fall back on if they encounter difficulties,” he said. “Otherwise, these disadvantaged people can easily impact the bottom line of society.”

Hong Kong export growth misses forecast | South China Morning Post The growth, which lagged economists’ forecasts of a rise of 4 to 5 per cent, underscored a weak economic recovery in the United States and disappointing demand in Europe in the wake of the 2008 global financial crisis, they said.

However, some economists expected better prospects this year on the back of recent strength in the US recovery while Europe’s turmoil hit its bottom.

China probes death of official who liquored up at lavish banquet | Reuters **”negative social impact” is my new favourite euphemism** The Central Commission for Discipline Inspection is investigating Chen Ruixi, deputy mayor of the small city of Sanming in coastal Fujian province, who attended the banquet, as well as his colleagues.

One official died suddenly after the feast, held at the canteen of a private company, the agency said, adding that the event had made a “negative social impact”.

COMPANIES

Citic’s bad loan writeoff a sign of strain in China’s mid-sized banks | South China Morning Post China Citic Bank’s shareholders have agreed for the bank to more than double bad-loan writeoffs for last year, the latest sign of how much China’s economic slowdown is costing the country’s mid-sized banks.

At a meeting in Beijing yesterday, shareholders signed off as expected on management’s plan to write off 5.2 billion yuan (HK$6.6 billion) in non-performing assets, Citic said in a Hong Kong stock exchange filing. The bank originally budgeted for two billion yuan in writeoffs.

Lenovo expands into internet service marketWantChinaTimes.com The Lenovo Group, one of the world’s largest PC suppliers, is placing putting more emphasis on catering to internet services in a bid to become more competitive, reports Shanghai-based First Financial Daily.

Instead of focusing on only hardware production, the company is shifting towards an operational style that will also values software capabilities and offering customized internet services.

Mobile Tourism Service Yikuaiqu Nets Millions of Dollars in Series A Financing Yikuaiqu, a tourism app, announced that it has raised millions of dollars in Series A financing led by Shenzhen Hight-tech Investment and followed by Shenzhen Capital Group, etc. The company has secured millions of yuan of angel investment in 2012. The capital will be used in research and development of its travel applications for scenic spots, said Liang Jiankun, CTO of the company.

Suning Commerce Fully Acquires Group-purchasing Site Manzuo with Nearly 10 Million Dollars Suning Commerce (SZ:002024) announced that it fully acquired group-buying site Manzuo for nearly $10 million (source in Chinese), continuing its expansion into Internet industry after becoming the largest shareholder of peer-to-peer video streaming service PPTV last year.

In addition to maintaining independent operation, Manzuo will also take over the group-buying and travelling businesses under Suning. Feng Xiaohai, founder of Manzuo, will be named as the head of Suning’s local life sector. The acquisition procedure will be completed by the end of this March.

Alibaba unveils its three games for Laiwang and Taobao The games are available on two of Alibaba’s mobile apps. Users who update Laiwang, Alibaba’s social messaging app, to the new 4.5 version, will notice a new tab under the “Explore” page with a castle icon. Pressing the tab takes users to the app’s new game center, which currently features two titles.

Not unexpectedly, all three titles fit firmly in the “casual” genre, which have proven to be popular among game developers looking to reach broad audiences, and social networks looking to keep up user retention. Of the games on Laiwang, “Pa Pa Pa” bears a resemblence to Line’s Bubble Pop, while “Po Po Po” recalls Simon. Taobao’s “Crazy Toy,” meanwhile, has many of the trappings of King’s Candy Crush Saga.

China Mobile Ltd. (ADR) (CHL): China Mobile Shakes Up Fixed-Line Broadband – Seeking Alpha A welcome development looks set to shake up China’s fixed-line broadband sector this year, with word that leading wireless carrier China Mobile (HKEx: 941; NYSE: CHL) is offering aggressive pricing after receiving a license to offer fixed-line service late last year.

After-school Tutoring Service TAL Education Injects 150 Million Yuan in Childcare Portal Babytree TAL Education (NYSE:XRS), a K-12 after-school tutoring services provider formerly known as Xueersi, announced today it will inject 150 million yuan ($24.79 million) of strategic investment in childcare portal Babytree. Babytree has secured a combined $20 million of investments in previous rounds.

The acquisition of Babytree will help TAL to include pre-school children into its target customers. TAL has acquired education site Kaoyan.com for 50 million yuan last year.

Flying the flag for Chinese cars – Xinhua | English.news.cn Chinese carmaker Hong Qi, or Red Flag, is pressing to have its brand move into the mainstream here in China after years of supplying vehicles to the Chinese government.

Six months ago, Red Flag opened this showroom in Beijing’s exclusive Jinbaojie Street, which makes them almost neighbours with other top name carmakers such as Ferrari and Maserati. So what makes Red Flag Sales Manager Wang Rui Chao believe customers will come to his showroom and not theirs?

Drilling services provider COSL expects deep-water revenue boost | South China Morning Post China Oilfield Services (COSL), the mainland’s dominant provider of offshore drilling services, expects more work and a greater contribution from more capital-intensive deep-water jobs will lift revenues this year.

However, the company warned that the subdued outlook for oil prices will constrain the upside for drilling rates.

China’s Tencent WeChat App Targets U.S. Users – China Real Time Report – WSJ The fast-growing smartphone messaging application is now trying to expand in the U.S. market with a newly launched promotional campaign.

According to WeChat’s Chinese website, here’s how the new promotion works: Tencent is asking people who hold Google accounts to connect their accounts with WeChat, so they can invite their Google contacts to join WeChat. People can win a $25 Restaurant.com gift card from Tencent by getting five of their Google contacts to join WeChat.

Tencent Fully Acquires Map Service Linktech Navi with 60 Million Yuan Chinese Internet giant Tencent continues its acquisition spree this year by pouring 60 million yuan ($9.92 million) of funding in Beijing-based mapping service Linktech Navi for a 100% stake in the company (source in Chinese).

Founded in 2001, Linktech Navi is accredited with the state Grade-A qualification on surveying and mapping. The company’s main businesses are digital maps, navigation system, GPS vehicle monitoring solution, LBS application solution, etc. Linktech Navi’s customers include automobile manufacturers, like Chery, Shac, and Hawtai Motor, navigation services, telecos, among others.

Closer Look: Developers Build Banking Ties with Stake Purchases – Hong Kong-listed Evergrande Real Estate Group expanded into banking by acquiring a 4.5 percent stake in Beijing-based Huaxia Bank for 3.3 billion yuan last week.

A source close to the property developer said the purchase is a strategic investment. Huaxia has a strong balance sheet that can improve Evergrande’s financials. It may help Evergrande finance at a lower cost, he said.

BRIEF-China Life Insurance expects 2013 net profit up 120 pct on investment gains | Reuters China Life Insurance Co Ltd

* Says expects 2013 net profit up 120 percent y/y versus net profit of 11.1 billion yuan ($1.8 billion) previous year

Source text in Chinese: link.reuters.com/wac46v

BRIEF-Ping An Insurance 2013 premium income totalled 268.7 bln yuan | Reuters Ping An Insurance Group Co of China Ltd

* Says 2013 premium income totalled 268.7 billion yuan ($44.4 billion)

Source text in Chinese: link.reuters.com/seb95v

allAfrica.com: Ethiopia: Halfway Point Reached in Inner-City Rail Project (Page 1 of 2) While China Railway Group Limited (CREG) won the contract for the construction of the lines, it was the Metal & Engineering Corporation (MetEC) that was charged with supplying the tracks and the trains to transport passengers. Once complete, the tracks will be of standard size (1.435m wide) double track for the whole route.

LNG import: SSGC, ECC likely to award $1.4b contract today – The Express Tribune EVTL had submitted the offer for LNG services in partnership with China Harbour Engineering Company, a subsidiary of China Communications Construction Company, which has been blacklisted by the World Bank until January 2017.

However, the government cleared the company, saying that the project was not being funded by the World Bank, therefore, EVTL could not be disqualified. However, “a question arises why such clause was made part of the tender when it could not be implemented,” an official asked.

SKAI Holdings secures AED737.6m (USD201m) of financing from China’s ICBC for its Viceroy Dubai Palm Jumeirah projectReal Estate – Zawya SKAI Holdings, the Dubai-based real estate investment company, today announced it has secured AED737.6m (US$201m) of financing for its AED3.75bn Viceroy Dubai Palm Jumeirah, ensuring the project is fully funded.

The financing agreement, which further reaffirms SKAI Holdings commitment to the UAE’s hospitality sector, was arranged by the Industrial and Commercial Bank of China (ICBC), China’s largest bank, marking its first project financing deal for a hospitality project in the Middle East.

BRIEF-China’s Jiugui Liquor says police investigating theft, financial impact uncertain | Reuters China’s Jiugui Liquor Co Ltd

* Says police investigating 100 million yuan ($16.53 million)stolen from its account with Agricultural Bank of China’s Hangzhou Branch, financial impact of the theft still uncertain

Chinese Pork Supplier WH Group Said to Apply for $6b IPO – Bloomberg WH Group Ltd., the Chinese company that bought the world’s biggest pork supplier last year, applied to the Hong Kong stock exchange for an initial public offering, said two people with knowledge of the matter.

The company plans to seek as much as $6 billion from the offering in the first half, the people said yesterday, asking not to be identified as the information is private. WH Group changed its name from Shuanghui International Holdings Ltd. this month.

The WSJ Weekend Interview with Erik Prince: Out of Blackwater and Into China – WSJ.com Now, sitting in a boardroom above Hong Kong’s Victoria Harbour, he explains his newest title, acquired this month: chairman of Frontier Services Group, an Africa-focused security and logistics company with intimate ties to China’s largest state-owned conglomerate, Citic Group. Beijing has titanic ambitions to tap Africa’s resources—including $1 trillion in planned spending on roads, railways and airports by 2025—and Mr. Prince wants in.

Nicaragua canal fast-tracked with Chinese boost The Chinese company, HK Nicaragua Canal Development Investment Co. Ltd., is working with the Nicaraguan government on a massive canal project experts say could take 11 years to finish, cost $40 billion and require digging about 130 miles (200 kilometers) of waterway.

Just as the Panama Canal was a projection of growing U.S. power at the start of the 20th century, the Nicaragua project already reflects China’s influence and financial clout around the world. Another Hong Kong-based company has been operating port facilities on both ends of the Panama Canal.

ICBC Chief: China’s Shadow Banking Overblown – TheStreet Viewers of China’s state-run television Saturday heard the head of the Industrial and Commercial Bank of China say shadow-banking problems in the country have been overblown and “distorted.”

ICBC Chairman Jiang Jianqing, interviewed by CCTV television at the World Economic Forum in Davos, Switzerland, said “society has over-exaggerated and completely distorted the severity of shadow banking” in China.

I did not disown rail deal – AG | The Star Githu further discounted claims that his office’s endorsement of the commercial agreement signed between Kenya Railways and the China Road Corporation was also an approval of the tendering process. He said the SGR the logic of the financing agreement had “the making of a closed tender”.

Posted from Diigo.

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China Business Briefs 26/1/14

Not much happening today with the imminent Chinese New Year.

ECONOMY

Fear grips markets as investors worry about China’s growth and US profits | South China Morning Post Fear is back in the market. Investors are worried about slower economic growth in China, a gloomier outlook for US corporate profits and an end to easy-money policies in the United States and Europe. They’re also fretting over country-specific troubles around the world – from economic mismanagement in Argentina to political instability in Turkey.

MOC calms talk of more FTZ pilots – Xinhua | English.news.cn China is still reviewing the applications of prospective new free trade zone (FTZ) pilots and hasn’t green-lit the establishment of any yet, a commercial official said on Friday.

“We are still studying other places’ FTZ applications and the State Council hasn’t approved any new set-up,” said an official of the Ministry of Commerce’s International Trade and Economic Relations Department.

re: The Auditors » Blog Archive » One Way Or Another: The SEC Versus The Chinese Big Four Firms Let’s break down the companies affected by the judge’s decision. I am assuming it will eventually be implemented in some form.

The PCAOB site lists 151 companies with mainland China auditors. That compares with 132 companies with audits signed by Hong Kong firms. (Numbers are skewed for KPMG which reports all issuer audits on one form, filed by Hong Kong, but PCAOB attributes all KPMG China issuer audits to mainland China.) The mix is different. PwC dominates on the mainland but an independent firm, Albert Wong & Co, has the most audits of Chinese issuers in Hong Kong.

I agree with Professor Paul Gillis that the ban will not affect US-listed companies audited by Hong Kong firms immediately, unless or until those companies start requiring SEC fraud investigations, too. In that case, the SEC and PCAOB will run into the same problem they have on the mainland. The PCAOB is prohibited from inspecting its registered firms auditing US issuers in Hong Kong. The SEC will run into the same “Chinese secrecy law” when trying to get audit work papers out of Hong Kong to investigate frauds as it has out of Shanghai or Beijing.

Reforms will result in fairer competition in China – Business – Chinadaily.com.cn Ongoing reforms in China will result in fairer competition in the country, the vice president of a leading business school said Friday.

Consumers in China will be better off thanks to tougher competition on the market, Hellmut Schuette, vice president and dean at China Europe International Business School told Xinhua in an interview on the sidelines of the World Economic Forum.

Major bank headquarters maintain deposit interest rate – Xinhua | English.news.cn China’s five major state-owned banks said Friday that their headquarters still maintain the deposit interest rate and surges reported on Thursday were individual cases by some branches for special clients or businesses.

The People’s Bank of China (PBOC), the central bank, announced on June 7, 2012 that the upper limit of the floating band of deposit rates would be adjusted to 1.1 times the benchmark, or up 10 percent at most. Local commercial banks began lifting the deposit interest rate after the announcement.

China Seeks to Attract Skilled Foreign Workers-Caijing China will speed up the exploration of immigration policies this year to  attract skilled foreign workers, a senior official said on Thursday.

However, Zhang Jianguo, head of the State Administration of Foreign Experts  Affairs, did not give details on when the policies will be  introduced.

Hangzhou closes live poultry markets to combat bird flu[1]- Chinadaily.com.cn Hangzhou, the capital of eastern China’s Zhejiang province, has suspended the trading of live poultry in order to halt the spread of the H7N9 bird flu virus.

The city banned the trading in its main urban areas on Friday, according to local health and industrial and commercial departments.

Solar industry bouncing back on mainland China after prolonged downturn | South China Morning Post The mainland’s solar panel industry is showing signs of booming again after a prolonged downturn – raising fears of another bust when the splurge of public money that is driving a spike in demand dries up.

But industry officials worry fast-growing generation capacity will increase fiscal pressures on China and Japan and force them to cut subsidies, which will then hit demand, just as happened with previous big solar users Germany, Spain and Italy.

COMPANIES

China’s Fosun Wants To Surpass Ping An Insurance In 2014 – Forbes For Guo Guangchang, chairman of China’s largest privately owned conglomerate Fosun Group, the ultimate goal is to be like Warren Buffett. To transform Fosun into a long-term strategic investment company much like Bershire Hathaway, the goal in 2014 would be to beat Ping An Insurance, the mainland’s second largest insurer that also provides financial and banking services, Guo said.

SOHO to increase Beijing holdings to 50% – Business – Chinadaily.com.cn SOHO China, a Hong Kong-listed property developer that specializes in commercial property, intends to hold half its property in Shanghai and half in Beijing, the company’s chairman said on Thursday.

Pan Shiyi made this comment when explaining that SOHO had sold out three projects in Shanghai last year.

“As we found that our holding property had reached 75 percent in Shanghai and only 25 percent in Beijing, we decided to restructure our portfolio to achieve a 50-50 split in both Beijing and Shanghai,” said Pan.

Spring Airlines bucks industry trend with 10% profit growthWantChinaTimes.com At a time when most airlines have seen profit declines due to restricted business flight demand, Spring Airlines, China’s only budget airline, reversed the downtrend to see profit growth of around 10% last year, Shanghai-based China Business News reports.

In 2013, total profits in China’s airline industry reached 27.3 billion yuan (US$4.5 billion), down 7.7% from 29.6 billion yuan (US$4.9 billion) a year earlier, while Spring Airlines, which owns 40 aircraft, enjoyed a profit growth of about 10%.

Tesla China chief unveils aggressive growth plan for China | Reuters U.S. electric carmaker Tesla Motors Inc (TSLA.O) expects its China sales to contribute one third of global sales growth this year, a senior executive said, adding that a trademark issue stalling full-entry into China had been resolved.

Veronica Wu, vice president of Tesla’s China operations, told Reuters the Palo Alto, California-based company planned to open stores in 10-12 Chinese cities by the end of 2014, including its flagship store in Beijing that opened late last year.

Tesla Announces Lower-than-Expected Price of $121k for Model S in China Tesla Motors, the electronic car startup co-founded by PayPal billionaire Elon Musk, announced that Model S will be sold for 734,000 yuan (US$121,280), lower than over 1 million yuan as previously speculated by the public.

Tesla claimed this is a fair price, although it is still about 40% more expensive as compared with $81,070 in the U.S. According to Tesla, the extra amount is generated from taxes, customs duties, and transportation costs. The company also breaks down the amount to $3,600 for shipping and handling, $19,000 for customs duties and taxes, and $17,700 for VAT.

America is in an Energy Renaissance; Don’t Get Too Excited About Cheap(er) Oil One reason for a potential surge in price is a major uptick in Chinese demand. 2013 was the slowest oil demand growth for China in decades, but next year, PetroChina (NYSE: PTR) estimates it will more than double last year’s growth. This could put a higher premium on international oil prices for the year, and further down the road as China becomes more and more reliant on oil imports.

25-year corporate tax holiday for US$ 1.3 billion offshore Colombo Port City | The Sundaytimes Sri Lanka The move to build Colombo Port City follows an unsolicited tender from China Communications Co. Ltd (CCC). The project is more expensive than the Mattala Rajapaksa International Airport (US$ 210 million), Phase 1 of the Hambantota Port (US$ 361 million) or the Colombo-Katunayake Expressway (US$ 350 Million) put together.

Noble’s macro trading head in Asia quits to make hedge fund comeback | Reuters Noble Group Ltd’s  head of macro trading in Asia, Allan Bedwick, has quit and is preparing to make a comeback in the hedge fund industry, sources said on Friday.

Bedwick managed his macro hedge fund firm, Sequence Asset Management, until 2012 and had moved to Noble Group last year.

Posted from Diigo.

China Business Briefs 12/1/14

Sorry about there being no blogpost yesterday. Enjoy today’s bumper issue.

ECONOMY

Beijing Tests Tools to Tackle Bad Debt – WSJ.com China’s government is gearing up for a spike in nonperforming loans, endorsing a range of options to clean up the banks and experimenting with ways for lenders to squeeze value from debts gone bad.

Write-offs have multiplied in recent months. Over-the-counter asset exchanges have sprung up as a way for banks to find buyers for collateral seized from defaulting borrowers and for bad loans they want to spin off. Provinces have started setting up their own “bad banks,” state-owned institutions that can take over nonperforming loans that threaten banks’ ability to continue lending.

Caixin Explains: What the Central Gov’t Thinks of Shadow Banking – Problems regarding shadow banking have long concerned the central bank and the China Banking Regulatory Commission (CBRC), but it was not until a meeting in July that the State Council made a priority of addressing the problem. A lot more attention was paid to the CBRC’s research on the matter, which constituted the basis of the document that was circulating.

The CBRC had argued that trust companies and some off-balance-sheet operations of commercial banks were not shadow banking, considering that they were not highly leveraged. Also, the Ministry of Commerce had long opposed treating pawn shops and financial leasing companies as shadow bankers.

China uncovers thousands of disaster risks in oil and gas sector | Asia-Pacific | BDlive China has uncovered about 20,000 disaster risks in its oil and gas sector during a nationwide safety probe following a pipeline blast that killed 62 people last year, the country’s safety watchdog said on Thursday.

People’s Bank of China keeps pressure on money markets – FT.com Last week, hours before 2013 came to an end, the People’s Bank of China delivered an unwelcome surprise to some of the country’s biggest banks. Despite frazzled nerves after a liquidity squeeze just one week earlier, the central bank told them it wanted to conduct a bond repurchase operation, a move that would take cash out of their hands for a few days.

“Everyone said it was like a new year’s message from the PBoC. They were telling us that money is going to stay tight,” says a senior credit trader with a European bank in Shanghai.

China Keeps Dancing With a Lehman Moment – Chovanec – MoneyBeat – WSJ China’s year-end cash crunch, the one that the government didn’t want journalists to call a cash crunch, is a very serious situation, Patrick Chovanec, chief strategist at Silvercrest Asset Management, said this morning on the MoneyBeat show.

Oilweek – The big chill China is an oil-producing superpower. Last year the country’s state-owned oil companies spent $35 billion buying foreign assets. One result: the country’s state-owned enterprises (SOEs) now produce almost as much oil outside the country as such OPEC kingpins as Kuwait and the United Arab Emirates. These overseas acquisitions are being operated as commercial investments, in the sense that oil from far-flung businesses is mostly being used to supply traditional markets. Add those volumes to China’s position as the world’s fifth-largest producer from domestic fields and the end result is a network of SOEs that is global in scope.

Women Add To Their Lead On Forbes China’s New List Of 50 Top Financial Planners – Forbes Women added to their majority on the new list, taking up 31 spots, compared with 28 last year. Their success, according to Forbes China managing editor Bridge Kang, comes in part from a convention in Chinese households that “men earn the money and women manage it.” That in turn helps female professional financial planners and advisers build good relationships among industry executives and customers, Kang said.

China Exports to Face Tough 2014 as Yuan Climbs – China Real Time Report – WSJ China’s export growth was disappointing in the final month of 2013due to lackluster demand from developed markets, data released Friday showed.

But there could be more problems in store for China’s exporters in 2014 as the yuan currency’s continued appreciation against the U.S. dollar makes the country’s goods more expensive in world markets.

Maturing of municipal bonds puts pressure on Chinese citiesWantChinaTimes.com Municipal bonds worth 285 billion yuan (US$47.1 billion) will be due in 2014 and bonds worth 140.6 billion yuan (US$23.2 billion) will be due in 2015, according to Shanghai-based China Business News. The total outstanding amount of municipal bonds in the nation is estimated in a range of 2.7-3.3 trillion yuan (US$447-546 billion), the paper reported.

China Auto Industry News | China Ends Microgrowth Myth With 13.9% Growth | China Car Times – China Auto News 2011 and 2012 ushered in the era of ‘micro -growth‘ for the Chinese auto market where auto sales slipped from the 30-40% range as seen in the previous decade to to 2.5% and 4.3%, respectively. It was widely thought, and accepted, that micro growth would be the norm rather than the exception for the Chinese automotive market. However, 2013 saw a strong rebound to 13.9% sales growth where sales grew to just under 22 million units over the course of the year with an exceptionally strong December where sales rose 17.9% year-on-year to 2.13 million units according to China Association of Automobile Manufacturers (CAAM)

Fitch’s China shadow banking guru quits – FT.com Charlene Chu, who as a senior director of Fitch Ratings was among the first to flag the growth of China’s massive shadow banking sector, is leaving the credit rating agency. Her departure ends an eight-year spell as a thorn in the side of the Chinese banking industry.

Ms Chu was one of the first to highlight the dangers of both shadow banking and China’s mammoth stimulus plan, rolled out in early 2009 in response to a collapse in global trade.

China iron ore imports grow 10% in 2013 – FT.com The strength of Chinese iron ore demand confounded analysts last year, with 2013 imports rising 10 per cent year-on-year to 820m tonnes, as steel mills defied expectations with an 8 per cent rise in output, according to estimates by the state-backed industry association.

Reversal of fortune in China’s peer-to-peer lending boom – FT.com Dozens of the P2P lending websites that sprang up in recent years have shut down. The biggest companies are unscathed so far, but the rapid collapse of smaller rivals highlights the mounting difficulties in the Chinese micro-lending industry as economic growth slows and monetary conditions tighten.

It is a dramatic reversal of fortune for China’s peer-to-peer websites, which, for a small service fee, connect people wanting to invest money with those looking to borrow small amounts.

Dubai property market attracting more Chinese investors|Markets|Business|WantChinaTimes.com The bubble created in Dubai’s real estate market burst in 2008, but the sector is now making a comeback, attracting global investors including those from China, reports Shanghai’s China Business News.

Housing prices in Dubai have surged by nearly 30% over the past year, with Dubai-based real estate developers, such as Nakheel Properties, recruiting salespeople that can speak Chinese to attract Chinese investors entering the market.

China central bank guides yuan slightly lower, downside seen limited – Economic Times China’s yuan edged down against the dollar on Thursday after the central bank fixed a slightly weaker midpoint but traders said the potential for any sharp correction was limited as Beijing appeared to want to keep the yuan largely stable for now.

Spot yuan was trading at 6.0546 per dollar at midday, falling 0.06 percent from 6.0512 at Wednesday’s close, after the People’s Bank of China (PBOC) set its midpoint at 6.1109, down 0.05 percent from Wednesday’s 6.1079. “Thursday’s midpoint guides the yuan to weaken slightly,” said a trader at a Chinese state-owned bank in Shangh

Chinese banks rush to float bonds abroad|Economy|News|WantChinaTimes.com McKinsey predicted that Chinese banks will raise 2 trillion yuan (US$330 billion) in funds from overseas markets, via issuance of stocks and bonds, in the next five years.

The trend will be fueled by the increasing difficulty of Chinese banks in raising funds on the domestic market due to rising bad debts, a sluggish stock market, rising funding costs, and the deleveraging process.

China mulls national pollution permit trading system | Reuters China will look into establishing a nation-wide trading system for pollution permits as part of efforts to use market mechanisms to help clean up its environment, the country’s top environment official said.

In remarks published on the website of the Ministry of Environmental Protection (www.mep.gov.cn) on Friday, minister Zhou Shengxian said China was working on new regulations for pollution permits and would also publish proposals for new pilot trading projects as soon as possible.

Private capital to play bigger role in China’s healthcare services|Policy|Business|WantChinaTimes.com Investors from Hong Kong, Macao and Taiwan can now run their own hospitals in every city at prefecture level or above, while it was previously stipulated that they could do so only in municipalities and provincial capital cities, according to a circular publicized by the National Health and Family Planning Commission on Thursday.

Investors from foreign countries can also set up wholly foreign-funded medical institutions in the newly established Shanghai Free Trade Zone and in certain other regions, according to the circular, which was jointly signed by the commission and the State Administration of Traditional Chinese Medicine, although it did not specify the other regions.

Half of China’s coastal outfalls over-discharging sewage – Xinhua | English.news.cn Half of China’s 156 coastal outfalls are discharging excessive sewage into the ocean, according to the State Oceanic Administration.

According to a survey conducted by the administration in November, 78 ocean outfalls are discharging excessive sewage, with municipal drainage being the biggest contributor.

Survey results showed that South China’s Guangxi is the most serious among six coastal provincial regions in over-discharging. Fourteen of its 15 ocean outfalls discharged excessive sewage.

China to expand cross-border use of RMB: PBOC – Xinhua | English.news.cn China will continue to expand the cross-border use of the Chinese currency, the Renminbi or yuan, this year, China’s central bank said Friday.

The Chinese yuan’s cross-border settlement reached 3.64 trillion yuan(596.6 billion U.S.dollars) in the first eleven months of 2013, which was 350 times the amount in 2009, the People’s Bank of China (PBOC) said at a work-planning meeting.

China fires back at U.S. for criticism on fishing curbs | Reuters China defended on Friday its new fishing restrictions in disputed waters in the South China Sea against criticism from the United States, saying the rules were in accordance with international law.

Beijing claims almost the entire oil- and gas-rich South China Sea and rejects rival claims to parts of it from the Philippines, Taiwan, Malaysia, Brunei and Vietnam.

Washington called the fishing rules “provocative and potentially dangerous”, prompting a rebuttal from China’s foreign ministry on Friday.

Securities regulator shares audit data with US counterparts – Business – Chinadaily.com.cn The China Securities Regulatory Commission has shared the audit details of four Chinese companies listed abroad with overseas regulators, in a further move to crack down on illegal activities and protect the interests of investors, the watchdog said on Friday.

Cabinet approves new zones – Business – Chinadaily.com.cn China’s cabinet on Friday approved the establishment of new zones in Northwest China’s Shaanxi and Guizhou provinces in the southwest, the latest move to open up inland regions.

Shaanxi’s Xi’an-Xianyang New Area and Guizhou’s Guiyang-Anshun New Area got the nod from the State Council, adding to a string of “new areas”.

Some previous new areas are the Chongqing Liangjiang New Area (approved in 2010) and the Lanzhou New Area (2012). But while the Chongqing and Lanzhou areas were designated as State-level development areas, along with four other such areas, the two latest areas approved didn’t achieve that top position.

Proposed pension reform divides opinion – Business – Chinadaily.com.cn The public is critical that government officials do not need to input into the country’s pension pool but will enjoy higher annuities after retirement than their peers from enterprises and farming due to different plans.

China adopts different pension plans for enterprise employees, rural residents, urban dwellers and workers with government and government-sponsored institutions. This has caused a gap in pension payments, Zheng Gongcheng, a professor with Renmin University of China, told the People’s Daily, flagship newspaper of the Communist Party of China (CPC).

China’s Liquidity Paradox-Caijing Consider this: Despite China’s swelling foreign-exchange reserves – the result of persistent current-account surpluses – market and interbank short-term interest rates are soaring. How did this happen, and what should policymakers do about it?

China December Exports up 4.3Pct, Trade Surplus $25.6B-Caijing China’s exports grew 7.9 percent in 2013 while imports expanded 7.3 percent from a year ago, resulting in a trade surplus growth of 12.8 percent, government data showed.

Trade surplus in the year hit 1.61 trillion yuan ($259.8 billion), with exports at 13.72 trillion yuan ($2.21 trillion) and imports 12.11 trillion ($1.95 trillion), according to data released by the General Administration of Customs today in Beijing.

COMPANIES

China Disciplines 48 For Pipeline Explosions In Qingdao – WSJ.com Two Sinopec executives in charge of the pipeline and a safety director were removed from their positions, Xinhua said. Three local officials in charge of an economic development zone in the Huangdao district of Qingdao—where the blasts occurred—also were dismissed, according to Xinhua.

In 2011, the State Council issued similar disciplinary warnings to 64 people responsible for four accidents at state-owned China National Petroleum Corp., the country’s largest energy company. Jiang Jiemin, CNPC’s former chairman, was among those disciplined for the accidents, which included a pipeline explosion in the port city of Dalian that didn’t result in casualties. Mr. Jiang was promoted two years later to head a government commission that oversees state-owned companies.

China Petroleum and Chemical Rating Increased to Buy at TheStreet (SNP) | Ticker Report China Petroleum and Chemical (NYSE:SNP) was upgraded by investment analysts at TheStreet to a “buy” rating in a note issued to investors on Wednesday, Stock Ratings Network reports.

China Petroleum & Chemical Corporation (Sinopec) (SNP): New Analyst Report from Zacks Equity Research – Zacks Equity Research Report – NASDAQ.com We are downgrading our recommendation on Sinopec to Underperform from Neutral, ahead of fourth quarter results.

China Railway tops charts for proper monetary insulation|WantChinaTimes.com China Railway Group, the nation’s largest construction company, came in on top for accounts receivable, tight cash flows and provisions for bad debt among China’s 36 listed firms related to the high speed rail sector, National Business Daily reports.

China Railway issued a statement on Jan. 6 to clarify that its high level of debt is related to the nature of the industry and not dissimilar from others in the sector. Its liability-asset ratio of 84.84% remains normal and the risk controllable. What should be noticed its high debt ratio has remained for years, the report said.

China’s State Grid buys biggest chunk of HK Electric’s IPO: sources | Reuters Government-owned State Grid Corp of China is coming in as the biggest cornerstone investor in a Hong Kong initial public offering (IPO) worth up to $5.7 billion by Li Ka-shing-backed HK Electric Investments, people familiar with the matter told Reuters.

Li’s Power Assets Holdings Ltd is planning to list its Hong Kong electricity business, HK Electric Investments, as it seeks funds for overseas expansion. The IPO is set to be launched on Monday, they added.

The first Chinese game console: Huawei’s Tron Tron is a small, cylindrical console that runs Android 4.2.3 and connects to TVs via HDMI (it is capable of 1080p output). All told, it’s about the size of a coffee mug. Huawei says the device will sell for $120 or less and come with 16 or 32 GB of storage. Internally, it’s using Nvidia’s Tegra 4 processor, and the Tron also has wi-fi and bluetooth connectivity and even a USB 3.0 port. Here’s a video of the thing in action via Huawei News:

Fosun buys Portuguese insurer for $1.4b – Chinadaily.com.cn Fosun International’s chairman Guo Guangchang said in statement on Thursday that the Hong Kong-listed company outbid US investment fund Apollo Global Management LLC to acquire an 80 percent stake in state-owned Caixa Seguros e Saude SGPS SA, Portugal’s largest insurance group, which is owned by state bank Caixa Geral de Depositos SA.

Shui On Land CEO Resigns as Billionaire Lo Takes Active Role – Bloomberg Shui On Land Ltd. (272), the Chinese developer that’s been selling assets to cut debt, said Chief Executive Officer Freddy Lee quit after less than three years and billionaire Chairman Vincent Lo will resume a more active role.

Shui On has been selling assets as it seeks to pay down debt and improve its cash position. The developer announced last month that it will sell a project in Shanghai to China Life Insurance Group Co. for 3.32 billion yuan ($549 million). New York-based Brookfield Property Partners in November invested $500 million into Xintiandi, which operates the popular entertainment complex in Shanghai.

U.S. Market Still Out of Reach for Chinese Car Makers – WSJ.com GAC Motor isn’t the only Chinese auto company shunning this year’s U.S. show. For the first time since Chinese auto maker Geely Automobile Holdings Ltd. debuted at the show in 2006, no Chinese car company will hold an exhibit this year.

Five years ago, many Chinese auto makers were hatching ambitious plans for going global. While some have been stepping up efforts to build their presence in emerging markets, for the most part they have fallen silent on their ambitions tapping demand in developed economies.

Kuga recall leaves buyers bruised – BUSINESS – Globaltimes.cn Chang’an Ford will recall 80,857 Ford Kuga SUVs produced between September 21, 2012 and November 13, 2013 from February 21, 2014 because of substandard steering knuckles, Chang’an Ford announced on December 27, 2013 on its website.

Goubuli prepares to put big dough into expansion[1]- Chinadaily.com.cn An eatery giant known for its steamed stuffed buns, and with an ambitious expansion plan to buy a United States coffee chain, is joining a growing number of Chinese enterprises in going global.

Goubuli Group, a renowned Chinese food corporation based in North China’s Tianjin, announced on Thursday that it plans to buy a US cafe chain company in the first half of the year.

Greenland Group Plans for A-share Listing-Caijing China’s state-owned property developer Greenland Holding Group Co. said today it aims to float shares in the domestic stock market.

The company plans to submit materials for an A-share listing to China’s securities regulator as soon as next month, said Greenland chairman Zhang Yuliag today.

Observer-Reporter | Chinese coal giant enters Greene Co. natural gas joint venture Officials with Energy Corporation of America and China Shenhua Energy Co. subsidiary Shenhua America Holdings Corp. announced a 50/50 joint venture to develop 25 natural gas wells in Greene County over the next 18 months.

China Tops Rolls-Royce’s Largest Market in 2013-Caijing China has toppled the US to become the largest market for Rolls-Royce Motor  Cars in 2013 with the country’s growing class of crass new riches.

The British-headquartered luxury carmaker sold 3, 630 cars around the world  last year, up from 3, 575 a year ago. 2013 also marked its fourth consecutive  year to report record sales.

Infiniti China Sales Surge – WSJ.com Infiniti, the premium car division of Nissan Motor Co., said its auto sales in China surged 54% in 2013 and the brand expects to maintain its growth momentum this year in the world’s largest auto market.

The company sold 17,108 Infiniti-brand cars in China last year, Johan de Nysschen, senior vice president of Japanese auto maker Nissan Motor and president of Infiniti, said Saturday. Infiniti posted a 16% decline in sales in 2012 amid a territorial dispute between Japan and China over uninhabited islands in the East China Sea.

Tencent’s Personal Cloud Storage Service Micro Cloud Releases 2.0 Version Chinese Internet giant Tencent recently released version 2.0 for its personal cloud storage Micro Cloud (Weiyun in Chinese) with a number of features that aims to turn the product into an integration service from a storage service. The new 2.0 version is expected to hit market on January 15 (source in Chinese).

WeChat’s Rank Rocketed up in the U.S. during Recent Holiday Season, but Dropped down soon AppAnnie has added new features to its free Store Stats tool that you can track apps’ performance on Google Play, iOS, Amazon, and Mac App Store apps in up to 10 countries at once.

For instance, you can see the rank history of WeChat on iOS Store in multiply countries as below. What immediately drew my attention is a peak during the past holiday season. The graph in orange is WeChat’s performance on the U.S. iOS Store. It’s unknown what marketing efforts by Tencent, WeChat’s parent company, helped it.

Steve Wozniak drops into Xiaomi Beijing HQ According to former Google and Android VP turned Xiaomi executive Hugo Barra, who just posted a photo and some details to his Google+ page, Woz is a new convert to their phones. Woz declared that it’s “very emotional for me to be a part of Xiaomi now” – a reference to him using a Xiaomi Mi3 (not working for the ambitious phone-maker).

A tale of two China stocks: NQ Mobile vs. Baidu – The Cody Word – MarketWatch Put simply, I know how hard it is to stay on top of and believe in the numbers that U.S.-based companies publish. To think that I could successfully do so in most any foreign-based company is rather insane. On the other hand, when I see someone like Muddy Waters’s Carson Block target a company like NQ Mobile out of China, it piques my interest, because I do think there’s money to be made finding companies who are pushing the envelope overseas.

Sam’s Club Has Potential in China Because China has the largest population in the world (1.35 billion people), you would think that this move should automatically lead to exceptional results. However, if you look at retailers that have attempted to make names for themselves in China in recent years, their moves haven’t gone so well, and this group includes Wal-Mart. Sam’s Club differs from Wal-Mart’s namesake stores, and this might be a positive for the potential of Sam’s Club in China going forward.

Warren Buffett’s Chinese Cars Are Coming to the U.S. (BRK-B, GM) BYD has done some intriguing work with hybrids and electric cars. But BYD has a long history of optimistic predictions, and the company has had a rough time staying competitive even in its home market. But the Berkshire Hathaway investment has given the company some global cred. Is it time to take them seriously?

Ford and Tencent Work Together To Bring Tencent’s QQ Music To Cars | China Car Times – China Auto News Ford have teamed up with Tencent’s QQ, China’s largest chat and social platform, to introduce QQ Music into all Ford SYNC systems. QQ Music features China’s leading online music streaming platform, and is the most popular music app among Chinese smartphone users, with more than 200 million monthly users and 40 million daily users.

Tencent, Alibaba Have their Eyes on Mobile Payment Prize – The transactions are part of what is sometimes referred to as online-to-offline, or O2O, business, an arena where Alibaba and Tencent are busy battling for supremacy. Late last year, Tencent, which is listed in New York, invested in Didi Dache. Before that, Alibaba put cash into promoting a similar app, called Kuaidi Dache.

And the rivalry is not limited to taxi-hailing apps. The two firms are expanding their offline frontiers to shopping malls, movie theaters, convenience stores and restaurants. Both are beefing up their mobile payment systems – the key to connecting online and offline services – to compete head to head with credit cards and cash payments.

BoCom HK rides wave of bond issuance – Debt – Deals – News – FinanceAsia.com Bank of Communications (BoCom) Hong Kong branch raised a $700 million three-year senior unsecured note on Wednesday, smartly riding the wave of other bond issuance that has hit the debt markets in the first week of the new year.

The bank’s debut Reg S-registered paper had an initial guidance of 170bp over Treasuries and ended up pricing 25bp tighter at 145bp over Treasuries, according to a term sheet.

Surprising hedge fund plays include Bitcoin and China stocks (ACGBY)-ACGBY-PNGAY-Stockhouse news Two examples that come to mind are Ping An Insurance Group Co. (OTO: PNGAY, Stock Forum) and the U.S. listed version of Agricultural Bank of China (OTO: ACGBY, Stock Forum), both of which are known to be heavily owned by hedge funds.  To this day, despite China stocks being in a bear market, PNGAY has not only seen increased liquidity due to hedge fund presence, but the stock recently experienced a run-up that can only be attributed to hedge fund-created momentum.

China Railway Group Ltd : China : CHINA Railway Group to FUND the UK s £50bn high-speed RAIL LINE | 4-Traders China Railway Group has approached Downing Street to fund the UK s £50bn high-speed rail line. This comes a month after Chinese premier Li Keqiang expressed China s interest in the infrastructure project to Cameron.

See how Noble Group earnings could rebound in 2014 | Singapore Business Review The earnings outlook for Noble Group is looking brighter as prices and crush margins may soon see a resurgence, according to Barclays Research.

Noble Group may see its agricultural business margins recover as well as revive its volume growth, which will help the company post better earnings this year.

Chinese Tycoon’s Vanishing Seen Linked to Probe of State-Firm Officials – WSJ.com Hua Bangsong, one of China’s richest men, controls a vast engineering-services empire, Wison Group, which develops chemical plants for the nation’s major oil companies and international giants like Germany’s  BASF SE. But the 48-year-old hasn’t been seen by colleagues since August, when he was detained by Chinese investigators.

Bank of China London Branch successfully issues 2.5 billion RMB Bonds | 4-Traders On 9th January 2014, the book building of the first London offshore RMB bonds issued by Bank of China London Branch was successfully completed? making it the highest value single issue of RMB bonds in London and providing UK and European investors with an additional high quality RMB product.

Fears OCBC may overpay for Wing Hang | Macau Business Daily Oversea-Chinese Banking Corp, Southeast Asia’s second-biggest lender, fell to an almost four-week low in early Singapore stock trading yesterday amid concern it may pay too much to take over Hong Kong’s Wing Hang Bank Ltd.

MVP Group pushes JV talks with CNOOC for Recto Bank | ABS-CBN News The group of business titan Manuel V. Pangilinan is aiming to reach a commercial agreement with state-owned China National Offshore Oil Co. Ltd. (CNOOC) to finally pave the way for exploratory works at the disputed Recto Bank in the West Philippine Sea, its spokesperson yesterday said.

World’s largest bank opens branch in Calgary Industrial and Commercial Bank of China, the largest bank in the world in total assets, officially opened a Calgary branch Wednesday.

The move marks the first foray into Alberta for the bank’s Canadian subsidiary, known as ICBK. There are already five branches in Toronto and two in Vancouver.

Industrial and Commercial Bank of China : Pak-Sino to constitute Experts Working Group | 4-Traders Pakistan and China have decided to constitute an ”Experts Working Group” on setting up energy and development projects in Pakistan with focus on their financing.

This was decided at a meeting between Water and Power Minister Khawaja Asif and Industrial and Commercial Bank of China (ICBC) Chairman Jiang Jianqing in Beijing.

Construction of the Yaoundé-Nsimalen highway takes shape – Business in Cameroon The roadwork initially scheduled for early 2013 will now be completed in thirty-six months by the Chinese company, China Communications Construction Company Ltd for 36.7 billion FCfa.

Posted from Diigo.

China Stock Watch 7/1/14

There’s been more than a few articles about how 2014 will be a good year for stock markets, but there’s been little sign of it so far with Chinese stocks. Major Chinese stocks are in several cases hovering around 10% above their 52-week low, and the Shanghai Composite is also circling that psychologically important 2000 barrier. That reform stuff that the Hu/Wen leadership kept putting off and putting off? They weren’t procrastinating. They knew it was backbreaking, painful stuff. Now Xi/Li have some enormously difficult work to do, in reining in debt, making at least a start on cleaning up the environment, breaking up or reforming the bloated SOEs, improving productivity, improving IP laws to enhance innovation, deflating the real estate bubble without bursting it, reforming pensions, the hukou and healthcare, improving education… and it goes on. It’s a monumental to-do list. Chinese stocks, consequently, face considerable uncertainty, as the macroeconomic environment tightens and reforms look set to burst SOE privileges.

On the day, then, fifteen of the major stocks fell, with China Construction Bank the worst performer, falling 1.96% to RMB4 a share (against a year low of RMB3.8). The P/E ratios of the four major banks (ICBC, Construction Bank, Agricultural Bank and Bank of China) are all around 4.8, which is remarkably low – until one reflects the likelihood of unrevealed bad debts and the problems revealed by the two recent credit crunches.

The only gains were posted by SAIC Motor (+0.84%), China Communications Construction (+0.78%) and Bank of Communications (+0.27%).

The Shanghai Composite Index closed marginally up, by 1.61 points (+0.08%), at 2,047.32.

Name Price Change Mkt cap 52wk high 52wk low EPS P/E
Sinopec 4.41 -0.07 (-1.56%) 514,053.02M 7.03 4.05 CN¥0.62 7.17
PetroChina 7.73 -0.04 (-0.51%) 1.41B 9.5 7.08 CN¥0.68 11.44
ICBC 3.55 0.00 (0.00%) 1.25B 4.53 3.4 CN¥0.74 4.83
China Construction Bank 4 -0.08 (-1.96%) 1.00B 5.19 3.8 CN¥0.85 4.73
Agricultural Bank 2.43 -0.01 (-0.41%) 789,249.73M 3.28 2.38 CN¥0.50 4.84
Bank of China 2.51 -0.02 (-0.79%) 701,205.02M 3.26 2.48 CN¥0.53 4.73
China Mobile 78.10* -0.05 (-0.06%) 1.57B 91.8 74.9 HK$8.20 9.52
Noble Group 1.03 0.00 (-0.48%) 6,825.89M 1.27 0.785 SGD0.04 28.42
China State Construction 3.03 0.00 (0.00%) 90,900.00M 4.18 2.9 CN¥0.62 4.92
CNOOC 13.66* -0.18 (-1.30%) 609,884.24M 17.38 12.04 HK$1.89 7.21
China Railway Construction 4.26 -0.05 (-1.16%) 52,557.93M 6.49 3.95 CN¥0.84 5.06
China Railway Group 2.49 -0.02 (-0.80%) 53,036.75M 3.41 2.3 CN¥0.44 5.68
SAIC Motor 13.15 +0.11 (0.84%) 144,986.20M 19 11.83 CN¥2.05 6.41
China Life Insurance 14.75 -0.03 (-0.20%) 416,904.40M 22.04 12.88 CN¥0.97 15.26
Dongfeng Motor 11.62* -0.16 (-1.36%) 100,119.31M 13.28 9.48 HK$1.38 8.44
China Shenhua 14.82 -0.02 (-0.13%) 294,764.17M 25.47 14.72 CN¥2.25 6.58
Ping An Insurance 40.1 -0.19 (-0.47%) 317,437.29M 53.27 31.69 CN¥3.45 11.63
China Telecom 3.70* -0.04 (-1.07%) 299,449.77M 4.42 3.48 HK$0.26 14.31
China Communications Construction 3.89 +0.03 (0.78%) 62,919.72M 5.79 3.8 CN¥0.81 4.81
Bank of Communications 3.76 +0.01 (0.27%) 279,227.85M 5.68 3.65 CN¥0.84 4.46

China Business Briefs 1/1/14

The Shanghai Stock Exchange is closed today, so no Stock Watch. Happy New Year to all readers – best wishes for 2014.

ECONOMY

China trusts bring contrasting fortunes – FT.com **Lack of regulation makes it highly risky, whatever the current form of certain banks** The term “shadow banking” in China for many observers conjures up images of underground lenders handing out credit to sketchy borrowers at usurious rates. But that is a simplistic view of many of the financial institutions that have moved into gaps left behind by the country’s heavily regulated banks.

Some shadow banks have indeed courted trouble; others, though, are well-managed companies with strong track records.

China’s manufacturing growth slows as demand for exports weakens – FT.com Growth in China’s manufacturing sector slowed for the first time in six months in December, dragged down by weak demand for Chinese exports, according to an official purchasing manager’s index.

The state-sponsored PMI fell to 51 in December, down from 51.4 in November, marking a four-month low and highlighting the challenges facing the ruling Communist party as it tries to transform the growth model in the world’s second-largest economy.

China’s factory growth slower but resilient at year end | Reuters Many economists have said China’s economy was likely to show weaker momentum in the final three months of 2013 after a rebound between July and September, due to slowing credit growth and a fall-off in restocking demand.

China’s farm produce prices stay flat – Xinhua | English.news.cn **Some notable spikes** Farm produce prices in 36 major Chinese cities stayed mostly flat in the week ending Dec. 29 compared with the previous week, according to the latest statistics from the Ministry of Commerce.

Average wholesale prices of 18 kinds of vegetables rose 4.8 percent from a week earlier, while the prices of bitter gourds and tomatoes increased 11.3 percent and 9.9 percent, respectively.

Food accounts for about one-third of China’s consumer price index (CPI), a main gauge of inflation.

Closer Look: Rise in Total Gov’t Debt – to 30.3 Tln Yuan – Means Change Is Needed – This is the third time the National Audit Office has surveyed government liabilities. The survey was the work of some 544,000 auditors across the country. It was performed in August and September, and a report was given to the State Council, the country’s cabinet, in mid-October. Suspicion had mounted about how horrible the figures were considering it took so long for the government to publish them.

Experts, especially those from overseas institutions and academia, tended to be pessimistic in their estimates of total local government debt, guessing the figure would be 18 to 25 trillion yuan. Chinese government officials and affiliated institutions were generally more sanguine, estimating it to be between 15 and 20 trillion yuan.

China’s Tianjin to Begin Restricting Car Population, Xinhua Says – Bloomberg **Tianjin’s subway is still relatively quiet** Only 100,000 new license plates will be issued in Tianjin next year, of which 60,000 will be distributed by lottery and the rest auctioned off for a minimum bid of 10,000 yuan ($1,650) each, according to Xinhua. Government departments will be banned from buying new official cars and all proceeds from the auctions will go to support public transportation, Xinhua reported, citing a plan approved by the Tianjin government.

Property to take less of the GDP load | South China Morning Post **Dangerously high** Property investment accounted for 15.8 per cent of the mainland’s gross domestic product in the first three quarters of last year, a record high and a big jump from the 5 per cent contribution in 2000.

The ratio has stayed above 10 per cent since 2009 and the industry, which affects more than 40 other sectors including metals and home appliances, has stood out and provided a cushion to slowing growth in the world’s second-largest economy.

Xi Says in New Year’s Address China Will Make Progress on Reform – Bloomberg **One leads to the other. Can expect to see more aggressive moves towards of South China Sea neighbours** Xi Jinping, delivering his first New Year’s address as China’s president, said the country must press ahead with reforms in 2014 to improve livelihoods and make the country “rich and strong.”

Analysis: Transparency the crux in China’s struggle to deal with rising debt | Reuters **Money talks louder** By letting local governments sell bonds for cash, China wants to rely on nimble markets rather than inflexible regulations to keep spendthrift units in check.

But analysts say China’s dreams of a municipal bond market are so far just that, as building one has been impeded by a lack of disclosure from local governments on how much money and assets they have, and how much they owe.

China’s Banks Adopt ‘Living Wills’ to Plan for Less Predictable Future – China Real Time Report – WSJ The living will proposals come at an appropriate time for China, as the nation begins to address the prospect of bank failures. Its government-dominated banking sector is seen as having implicit state support. But Beijing wants to bring private capital to the sector and that could mean new risks. While China wants fresh competitors to shake up its banking system, it doesn’t want to be on the hook for management mistakes.

China-Russia trade sees downshift in 2013|Markets|Business|WantChinaTimes.com China-Russia trade value in January-November stood at US$81 billion, up 0.5%. The growth rate is more than 10% down on a year ago, according to China’s general customs administration.

During the period, exports to Russia reached US$44.56 billion, up 11.3% while Russian exports to China stood at US$36.5 billion, down 10.1%.

Chinese Banks Eye Global Bond Market – WSJ.com The country’s banks will need to raise up to two trillion yuan ($330 billion) from share and bond sales in the next five years, according to McKinsey & Co. With growing levels of bad debt in a slowing domestic economy, weakness in stock markets and rising capital requirements, Chinese banks can no longer rely on share sales and the country’s four-trillion-yuan bond market for cash.

China’s third economic census enters registration phase – BUSINESS – Globaltimes.cn China’s third national economic census entered its registration phase on New Year’s Day after months of preparation, according to the National Bureau of Statistics (NBS).

The census is designed to paint a wide economic picture of China’s fast-expanding secondary and tertiary industries and complete a database covering all economic sectors, said NBS head Ma Jiantang.

China suspends Pfizer imports – Chinadaily.com.cn China’s drug watchdog has decided to stop importing an injection from the Pfizer Inc., as the US pharmaceutical maker failed in a supplementary application for drug exports.

China will not import Pfizer’s Fluconazole injection, used to treat monilial infection, until the company makes correction, the State Food and Drug Administration announced Tuesday.

NDRC: Negative list to cut central govt role in investment – People’s Daily Online The National Development and Reform Commission, the country’s economic planner, vowed on Tuesday to stick strictly with the State Council’s directory of investment projects that require government approval.

The directory, known as the negative list, came into effect on Dec 2 and replaces the government’s approval procedures for 19 investment areas.

It devolves the responsibility to approve 30 categories of investment items from central to local authorities, and it transfers approval for 10 kinds of investment projects to industrial administrations.

Timeline: a history of Bitcoin in China in 2013 In the first three months of this year, China’s relationship with bitcoin was virtually nonexistent. A handful of scattered miners and exchanges like BTC China, which launched in 2011, had never really entered the public eye.  As far back as we can tell, Bitcoin’s recorded history in China dates back to April, when a Chinese charity started accepting bitcoins to help earthquake victims in Lushan, Sichuan province. That probably sparked the curiosity of a few speculative investors. The miners sooned caught the favorable eye of state media, which led to China’s explosion of interest.

Walter Lippmann on China – Silicon Hutong **Innovation and agility** “The small American businessman has long complained about how difficult it is for him to survive in the competition with the large American corporation,” [Walter] Lippmann warned. “What will he do when he has to face the competition of totalitarian monopoly organized on a continental scale?”

Lippmann was talking about the Soviet Union at the time, but his words do resonate today.

The year of bitcoin – The Tell – MarketWatch Elsewhere, banking authorities in China, India and Europe issued warnings about the risks associated with bitcoin. Developments in China took a bite out of the bitcoin rally, which was supported in part due to increased Chinese demand, and raised questions about what geographic region could attract the next round of bitcoin mania.

5 Things to Watch: China’s Energy and Environmental Policy – Five Things – WSJ An overhaul of China’s energy and environmental policies will be in focus next year as the country struggles to balance economic growth with protecting the environment. In November, China’s central government said in its landmark reform plan that it would allow markets to take a more “decisive role” in the economy, a signal that the era of cheap, tightly controlled energy prices might be over. Here are some major energy and environmental-policy reforms to look out for in 2014.

China Money Network − The Drivers And Headwinds For China’s Economy In 2014 Now onto the negatives. Drags on growth include tighter monetary policy, a slower real estate market (though location is everything), a cash crunch in the local government infrastructure space and a mild rise in inflationary pressures.

Regional jet service set to start in 2015 – Xinhua | English.news.cn China’s first domestic regional jetliner will go into commercial operation in 2015, with the first two ARJ21-700 aircraft intended for commercial service rolling off the assembly line on Monday.

The dual-turbofan planes will be delivered to Chengdu Airlines Co Ltd by the end of 2014, assuming the airworthiness certification process goes smoothly.

COMPANIES

Chinese state firms looking malnourished in 2013: report|WantChinaTimes.com **See yesterday’s analysis of the annual performance of the twenty largest stocks** Six state firms sit on the top 10 list with China National Petroleum Corp (CNPC) having seen the highest market value decline among all state firms. CNPC’s market value slipped from 1.46 trillion yuan (US$241 billion) at the beginning of 2013 to 1.24 trillion yuan (US$204 billion) by the end of the year.

In addition to CNPC, state companies that are on the top 10 lists are China Shenhua Energy Company, the Industrial and Commercial Bank of China (ICBC), the China Life Insurance Company, the China Petroleum & Chemical Corp (Sinopec) and the Bank of China (BOC), whose combined market value shrunk by nearly 600 billion yuan (US$99 billion) this year.

How Alibaba and Tencent went head-to-head in 2013 This past year saw some major competition emerge between Tencent, China’s massive gaming and social networking company, and Alibaba, which is best known for its e-commerce offerings. Below we’ve tracked the progression of both firms throughout 2013 and ask: what’s next?

Baidu.com, Inc. (ADR) (BIDU): Baidu Cranks Up Anti-Piracy Campaign – Seeking Alpha **Got to act mature if it wants to play with the big boys** Just days after announcing a new acquisition designed partly to rid its various sites of piracy, leading search engine Baidu (Nasdaq: BIDU) has removed all pirated material from one of its popular video sharing sites. The timing of this move looks quite interesting for a number of reasons, including the fact that Chinese media are saying Baidu has just been fined by Beijing for piracy violations. The move also comes just 6 weeks after Baidu was sued for piracy by China’s leading video sites, which took the action in an unusual alliance with Hollywood’s most powerful trade association. But perhaps most interesting is the fact that the U.S. could soon release its latest list of the world’s most “notorious” piracy sites, and Baidu has no desire to see its name appear on the list.

Morgan Stanley Stake Purchase Propels NQ Mobile Rally – Bloomberg Shares of the Beijing-based company soared 17 percent to $13.90 in New York, the biggest gain since Nov. 11. Morgan Stanley, which helped NQ Mobile raise $173 million in convertible bonds in October, said in a filing that it has a 5.2 percent stake. The Bloomberg China-US Index of Chinese companies trading in the U.S. slipped 0.6 percent yesterday, paring its 6 percent advance this year.

805 companies face punishment for pollution **But what punishments?** The names of 33 companies, including Ansteel Group’s chemical branch in Northeast China’s Liaoning province, were publicized by the ministry for serious air or environmental pollution.

Another 890 small workshops were shut down in the inspection, the ministry said.

Why China Ming Yang Wind Power Group Ltd. Soared 113% in 2013 (MY) Shares of wind-turbine maker China Ming Yang Wind Power Group  (NYSE: MY) clearly had the wind buoying them in 2013, having clocked a massive 113% gains. For a company that’s yet to turn in a profit, the rally may seem out of place. Yet, a growing order book, and great-looking prospects in the clean energy space, kept investors hopeful. But will that be enough to propel the stock higher in 2014, or is the rally close to over? Let’s find out.

Shenzhen incubated Wearable Device Startup Vigo Helps you Stay Alert and Fight DrowsinessThe Vigo team moved to Shenzhen, China as part of the hardware accelerator HAXLR8R. HAXLR8R offers seed funding ($25,000), office space as well as mentorship along with the other opportunities for startups to take an idea to a product. The programme is based in Shenzhen in order to leverage the supply chain and factory ecosystem. They use a process they call ‘Interactive Manufacturing Process’ to ensure rapid development of manufacturable products.

The Island Speaking at the occasion Minister Abeywardena said that Sri Lanka will sign US $2 billion worth Foreign Direct Investment (FDI) deals, including the $ 1.3 billion Investment from China Communications Construction Co. Ltd. to build a port city.

Riding the Digitization Trend into a New Industrial Age – PR Newswire – The Sacramento Bee Huawei Unveils its Viewpoints on 2014 Industry Trends

TAZARA, Chinese firm sign pact for four locomotives The Tanzania-Zambia Railway Authority (TAZARA) has sealed a contract with the Chinese Civil Engineering and Construction Company (CCECC), for the manufacture and supply of at least four new mainline locomotives.

According to a statement from the TAZARA head office in Dar es Salaam, the locomotives will be supplied together with consumables and spare parts worth Chinese RMB Yuan 85 million (about USD12.45 million).

Chery plans to build R&D center in Brazil – People’s Daily Online After building an engine factory in November, Chery automobile plans to build a R&D center in Brazil. The CEO of Chery Brazil, Luis Curi, said the investment of this center would be tens of millions, aiming to promote localization. Chery has planned an assembly plant, an engine factory and a R&D center.

Numerous Gurus Hold IDCC, DGX, PTR at 10-Year Low P/B – NASDAQ.com According to the GuruFocus Value Screen  that shows value strategies of stocks traded at historical low P/B ratios, InterDigital Inc. (IDCC), Quest Diagnostics Inc. (DGX) and PetroChina Co. Ltd. PTR) are held by numerous gurus and are traded at or near their 10-year low. Furthermore, insiders are selling IDCC and DGX.

Revlon to Exit Operations in China, Cut 1,100 Jobs – Bloomberg Revlon Inc. (REV), the maker of cosmetics under its namesake and Almay brands, will cease operations in China and eliminate about 1,100 positions, including 940 beauty advisers, as it restructures its struggling business.

The China business makes up about 2 percent of net sales, and the restructuring will result in about $22 million of pretax charges, the New York-based company said in a filing with the U.S. Securities and Exchange Commission. The changes are expected to reduce costs by about $11 million a year, Revlon said.

Posted from Diigo.

Top China Stocks Annual Performance 2013

Well, the year end is upon us, and we’ve heard how the Shanghai Composite Index has done over 2013. But what about the twenty major stocks which this website tracks? Let’s take a look. (All charts and data are from Google Finance).

Sinopec -27.11%

Sinopec 2013

PetroChina -13.95%

PetroChina 2013

ICBC -12.47%

ICBC 2013

China Construction Bank -8.63%

China Construction Bank 2013

Agricultural Bank of China -10.51%

Agricultural Bank 2013

Bank of China -9.03%

Bank of China 2013

China Mobile -11.08%

China Mobile 2013

Noble Group -8.94%

Noble Group 2013

China State Construction Engineering -18.23%

China State Constuction Engineering  2013

CNOOC -14.37%

CNOOC 2013

China Railway Construction -19.66%

China Railway Construction 2013

China Railway Group -12.17%

China Railway Group 2013

SAIC Motor -16.97%

SAIC Motor 2013

China Life Insurance -25.05%

China Life Insurance 2013

Dongfeng Motor +0.83%

Dongfeng Motor 2013

China Shenghua Energy -36.2%

China Shenhua Energy 2013

Ping An Insurance -5.22%

Ping An Insurance 2013

China Telecom -7.76%

China Telecom 2013

China Communications Construction -22.2%

China Communications Construction 2013

Bank of Communications -20.5%

Bank of Communications 2013

In a handy chart:

Name % Change
Dongfeng Motor +0.83%
Ping An Insurance -5.22%
China Telecom -7.76%
China Construction Bank -8.63%
Noble Group -8.94%
Bank of China -9.03%
Agricultural Bank -10.51%
China Mobile -11.08%
China Railway Group -12.17%
ICBC -12.47%
PetroChina -13.95%
CNOOC -14.37%
SAIC Motor -16.97%
China State Construction Engineering -18.23%
China Railway Construction -19.66%
Bank of Communications -20.5%
China Communications Construction -22.2%
China Life Insurance -25.05%
Sinopec -27.11%
China Shenhua Energy -36.2%

2013 has been very poor indeed for major Chinese stocks. No wonder SOEs have been warned that poor performance will be “severely dealt with“. (While all the companies listed are on the stock market, most still have substantial state ownership, and even more substantial state influence). But it’s equally clear that things have to change.

China Business Briefs 20/12/13

ECONOMY

PBoC acts to ease China cash crunch fears – FT.com The Chinese central bank has made an emergency money injection after a surge in interbank rates, trying to prevent a repeat of the cash crunch that rattled global markets earlier this year.

In a highly unusual move, the People’s Bank of China said it had conducted a “short-term liquidity operation” to provide credit to banks in need of money.

China’s Money Rates Climb, Stocks Slide as Cash Crunch Deepens – Bloomberg The seven-day repurchase rate, a gauge of liquidity in the financial system, increased 100 basis points to a six-month high of 7.60 percent in Shanghai, according to a daily fixing by the National Interbank Funding Center. It jumped 328 basis points this week, the most since January 2011. Transactions were recorded at rates ranging from 3.8 percent to 10 percent as of 4:17 p.m. local time, with a weighted average of 8.22 percent. The Shanghai Composite Index (SHCOMP) of shares slid 2 percent.

Fed taper comes at ‘delicate moment’ for China[1]|chinadaily.com.cn The United States Federal Reserve Board’s announcement that it will scale back its bond-buying program could crimp liquidity in China at a delicate moment, analysts warned.

China’s interbank lending rate is at its highest since June, when the central bank pushed up rates to discourage borrowing, a move engineered partially to prevent further shadow banking activity, said Patrick Chovanec, managing director of Silvercrest Asset Management Group and former economics professor at Tsinghua University.

China says more state companies might be sold off but Beijing will control major industry – Business – Times Colonist Regulators are working on plans to overhaul ownership following last month’s Communist Party pledge to increase competition in state-dominated industries, said Huang Shuhe, deputy chairman of the panel that controls China’s biggest government companies.

Economists say Beijing must curb the dominance of state companies that control swathes of the economy, from banking to oil to steel production, or risk seeing China’s growth rate plunge. The development blueprint issued last month pledges to open more industries to competition, though it said state ownership will remain the core of the economy.

By H1 2013, 465,600 sets of ATMs had been included in China UnionPay, exceeding the United States (445,000 sets) to rank first in the world. However, by quantity of ATMs per million of persons, China (307 sets, 2012-year) still lagged behind western Europe (786 sets, 2012) and the United States (1,376 sets, 2012).

China Prepares to Give State-Owned Enterprises a Professional Look – Wall Street Journal – WSJ.com China wants reformed state-owned enterprises to pay the government more in dividends, the State-Owned Assets Supervision and Administration Commission said on Thursday.

“We need to improve the management of state-owned capital and raise the proportion of profits that are paid out, commission vice chairman Huang Shuhe told a news conference on Thursday. He didn’t give a timetable for these changes or indicate which state-owned enterprises would become joint stock companies where private-sector investment was encouraged.

Chinese unhappy with price levels: central bank – Xinhua | English.news.cn Chinese urbanites are unhappy with the price of goods and services, a central bank survey showed Thursday.

The People’s Bank of China found in its latest quarterly survey of urban bank users that 61.6 percent thought prices in the fourth quarter were “high and unendurable,” up 1.8 percentage points from the third quarter.

China Pushes Ahead on Deposit-Insurance Plan – WSJ.com China is signaling that it is close to insuring a big chunk of its roughly $17 trillion in bank deposits, a key move toward opening up its financial system but one that carries risks for lenders big and small.

The aim is to reassure depositors that their money is safe as the nation moves to allow more competition in the financial system. That could be bad news for China’s big state-run banks, which already enjoy the implicit backing of Beijing but would have to pay for it under a new deposit-insurance program.

PBOC Adds Funds to Banks Amid Worst Cash Crunch Since June (1) – Businessweek The People’s Bank of China conducted short-term liquidity operations recently and will continue to supply funds to qualified financial institutions in this way based on the situation, it said on its microblog. The announcement did not give details of the size or pricing of the cash injections. The monetary authority injected 200 billion yuan ($32.9 billion), online financial news provider Netease reported, citing an unidentified person.

The average price of new Android phones in China? Just $233 Android is huge in China, with an estimated 270 million actively using an Android phone right now. We know which brands Chinese Android users like to buy, but how much are they spending on each phone? App analytics platform Umeng says it has the answer.

Umeng has observed all the Android phones that appear on its ad network and found that China’s average price of newly sold Android phones is just RMB 1,426, which is $233. The figure comes from data for October, and is the newest available right now.

China’s Online Retailers Look Abroad – WSJ.com Chinese Internet retailers serve what has become the world’s biggest e-commerce market. Their next target: the U.S., and the rest of the world.

Jingdong Corp., a leading Chinese Internet retailer by sales, has logged millions of yuan in sales on its English-language site in the past year, despite almost no advertising, according to the firm. AliExpress, which Alibaba Group launched in 2010 as its overseas platform, is growing rapidly in emerging markets, reaching 700,000 registered users in Russia alone.

Caixin Summit: Regulation of P2P Lending ‘Needs to Improve’ – The government needs to release more detailed supervision guidelines for the booming peer-to-peer (P2P) lending business, experts said at the Caixin Summit, which is being held December 18-19 in the capital.

Ren Yong, founder and chairman of the P2P site Yooli.com, said that due to relatively low market entry requirements and attractive business opportunities, new P2P sites are launching every day, but some of them posed risks to investors.

Gripes over JPMorgan’s commodities sale – FT.com Binding bids were due this week, according to people familiar with the sale process. Companies that have considered bids for some or all of the business included BTG Pactual, the Brazilian investment bank; trading house Castleton Commodities International, which is backed by private equity group KKR; Gunvor, the Swiss-based trading house; and Noble Group of Hong Kong.

“They asked for binding bids, but they’ve given people so little information that a binding bid is subject to due diligence. So it’s not really a binding bid,” said a person familiar with the process.

Warning sounded on taper outflows | South China Morning Post “The normalisation of the US monetary conditions will inevitably heighten market volatility,” warned the Hong Kong Monetary Authority in response to the Fed’s policy. “The Fed’s quantitative easing policy over the past few years has led to large capital inflows to emerging markets. As the US economy gradually recovers, fund flows may reverse, exerting downward pressure on asset prices.”

Beijing vows to boost Bolivia infrastructure – Headlines, features, photo and videos from ecns.cn|china|news|chinanews|ecns|cns China and Bolivia’s economic cooperation is growing.

Bilateral trade volume reached $516 million in the first eight months of 2013, an increase of 18 percent compared with the same period last year, according to Chinese customs data.

COMPANIES

William Merritt, the chief executive of InterDigital, said in a statement about the final ruling on Thursday, “Today’s determination by the ITC is extremely disappointing. We believe the commission’s claim constructions are plainly wrong, and we look forward to appealing the determination.”
Established in April, 1963, CFHEC is an affiliate of China Communications Construction Company which has 15 years presence in Ethiopian road construction. CCCC major recent road projects in Ethiopia include the Addis Ababa – Adama Expressway and Africa Avenue (Bole Road) projects.

Chinese man gets 3-year prison sentence for attempt to smuggle satellite parts from Colorado – Denver Business Journal According to the indictment, in late 2011, He bought $549,654 worth of radiation-hardened computer circuitry designed for satellites from Aeroflex Colorado Springs, and tried to ship the circuitry to China from Long Beach, Calif., aboard a Shanghai-bound container ship.

The ship was owned by Zhenhua Port Machinery Company Ltd., a subsidiary of the Chinese state‑owned corporation China Communications Construction.

China’s Huawei expects 4G revenue to double to $4 billion in 2014 | Reuters Chinese telecommunications equipment maker Huawei Technologies Co Ltd expects revenue from its 4G mobile network business to double to $4 billion in 2014 compared with this year, a senior executive said on Friday.

The company also expects revenue from the overall wireless market to total $12.9 billion next year, up from $11.7 billion this year, David Wang, president of Huawei Wireless Network, told reporters in Shanghai.

Li Guoqing, CEO and co-founder of Dangdang, said Wednesday on his Sina Weibo account that the board welcomes strategic investment but has no plan to offer the whole company for sale, refuting recent media reports that domestic search engine firm Baidu is likely to acquire Dangdang.

Ping An Insurance to issue $4.27 billion of convertible bonds | Reuters Ping An said in the exchange filing on Tuesday it has appointed China International Capital Corporation Ltd and Credit Suisse Founder Securities Ltd as joint sponsors and joint lead underwriters. Goldman Sachs Gao Hua Securities, Guotai Junan Securities and JPMorgan First Capital Securities are also joint lead underwriters.

The bonds have a term of six years and pay a coupon of 0.8% in the first year, 1.0% in the second year, 1.2% in the third, 1.8% in the fourth, 2.2% in the fifth and 2.6% in the sixth.

Baidu Wants to Go Viral (BIDU, QIHU) Baidu‘s (NASDAQ: BIDU  ) push into security software — a move that seemed born more out of revenge than strategic opportunity — is starting to pay off. China’s leading online search engine revealed yesterday that Baidu Antivirus was named this year’s “most promising antivirus” in Softonic.com’s Big Antivirus Comparison.

Baidu Antivirus placed third overall in system performance, and that’s a pretty notable achievement for the rookie.

CNOOC Limited : China faced most scrutiny in 2012 over investments in U.S | 4-Traders Chinese corporations filed 23 notices with U.S. regulators in 2012, up from 10 in 2011 and nearly quadruple the number in 2010, according to the Committee on Foreign Investment in the United States, or CFIUS.

This compared with 17 notices from companies from the United Kingdom last year, the report said.

China Construction America Buys New York Builder in First U.S. Deal | ENR: Engineering News Record | McGraw-Hill Construction China Construction America Inc., the U.S. arm of China State Construction Engineering Corp. Ltd., is building on its organic growth in the American market with the acquisition of Plaza Construction Corp., New York City.

While CCA has operated in in its Jersey City, N.J. base for 20 years, this is its first U.S. acquisition.

While a number of billion-dollar plus overseas deals have been completed by Chinese SOEs in the energy and natural resource sectors, and large private companies like Wanda and Shuanghui Group have made billion-dollar plus overseas acquisitions, China’s industrial SOEs have been more cautious. SOEs must get numerous approvals from Chinese regulators to invest outside the country, but despite China’s general encouragement for its companies to “go global,” these approvals have not been easy to come by. The complications of managing overseas businesses, plus sluggish business conditions in Europe and the United States, are two of the main reasons.

Everbright Bank Falls in Gray Market After $3 Billion Share Sale – Businessweek Shares of the Beijing-based lender fell 2.5 percent to HK$3.88 at the 6:30 p.m. close of trading, with 1.68 million shares changing hands, according to records of trading arranged by Phillip Securities Group. Everbright Bank sold 5.84 billion shares at HK$3.98 apiece.

China’s 11th-biggest lender by market value joins other banks bolstering their capital through Hong Kong listings ahead of requirements to hold more reserves. Chinese regulators are pushing banks to strengthen their balance sheets as concern mounts that slowing economic growth may lead to an increase in bad debt.

Posted from Diigo.