China Everbright

China Business Briefs 31/12/13

ECONOMY

Renminbi strengthens to new high against greenback|Finance|Business|WantChinaTimes.com The renminbi, or yuan, marched to a new record high against the US dollar on Tuesday.

The yuan strengthened 55 basis points to reach 6.0969 per US dollar, the strongest since July 2005, when the country launched reforms of the exchange rate mechanism, according to the China Foreign Exchange Trading System.

China to Unveil Property Tax Law in 2014: Official-Caijing **Big news, if true – illicit properties to be paid for** China will introduce a property law in 2014, as part of its broader efforts to reform the country’s fiscal and taxation system, a government official said.

Laws on environment protection tax and futures are also on agenda to make in the coming year, Wei Dale, a section chief at the National Development and Reform Commission, told a financial and tax forum in Beijing.

Exclusive: China may raise Iran oil imports with new contract: sources | Reuters China may buy more Iranian oil next year as a state trader is negotiating a new light crude contract that could raise imports from Tehran to levels not seen since tough Western sanctions were imposed in 2012, running the risk of upsetting Washington.

An increase would go against the spirit of November’s breakthrough agreement relaxing some of the stringent measures slapped on Iran two years ago over its nuclear program.

Xi Faces Test Over China’s Local Debt – WSJ.com Reining in local-government projects has been tricky for Beijing. China is dotted with vacant or underutilized housing developments, industrial parks, business districts and even entire cities, the product of overambitious plans by local governments. In the short term, the construction of empty buildings helped boost output. But longer term, many of those projects have become a financial burden, soaking up money to repay lenders and leaving many local governments short of funds for social spending, which in turn creates the potential for local unrest.

China still plays game of kick the debt can: WSJ – MarketWatch **Which causes banks to lose market confidence** A Moody’s survey found that only about half of local-government financing vehicles had the cash on hand to meet debt payments this year. Yet defaults are rare, as lenders roll over loans.

In the meantime, however, the most likely scenario is for lenders to continue with their practice of loan forbearance. More than 20% of the local-government debt counted in the audit came due this year. Another 40% is due in the next two years. While rolling debt prevents a short-term issue, it has costs: The practice weighs bank balance sheets with unproductive lending and spares debtors the consequences of poor decisions.

China confident it aced local debt audit exam – FT.com **Interesting perspective** For those disinclined to trust Chinese economic data, the audit has not led to a change of heart. Instead, it has provoked more scepticism: if the government is fessing up to this much debt, the true hole must be enormous.

Yet in Beijing, the belief is that this debt audit – the third in three years – is the most detailed and accurate measure of the problem. Ma Xiaofang, vice head of the department leading the government debt audit, noted that 50,000 officials had worked over the past half year, with higher levels of government checking on lower levels. “This system ensured that our audit did not encounter interference, that our audit figures are real and reliable,” he told state broadcaster CCTV.

Data Illustrate Poor State of China’s Soil – WSJ.com **Grim indeed** Figures released by the Ministry of Land and Resources on Monday in Beijing indicated as much as 2.5% of China’s soil could be too contaminated by heavy metals and other pollutants to farm. Meanwhile, the share of China’s land that is arable fell by a fifth of a percent during the three years ended in 2009, a reminder of the fine balance the government faces in protecting farmland as it sustains policies like urbanizing its population..

In its report, the first on land conditions made public since 1996, the ministry described the trends as worrisome and said the nation’s land situation remains “grim.” It said China’s stock of arable land has fallen in recent years and is less than half the world average per capita.

Chinese Hedge Funds Take Cover – WSJ.com Chinese funds focused on the nation’s domestic stocks are increasingly looking to hedge their bets.

While short selling, or betting that a stock’s price will fall, remains uncommon in China because of the high cost of borrowing stocks, hedge funds are using CSI-300 index futures and other methods to limit their risk. And fund managers say they expect regulators to roll out more products that will allow them to better hedge in the future.

Optimism running high for Chinese shares next year | South China Morning Post At 9.3 times forward 12-month earnings, the MSCI China is trading at a chunky discount to its 10-year median and at its widest gap to the MSCI Asia ex-Japan since the 2008 financial crisis.

And the Chinese market is trading at a 40 per cent discount to MSCI India on a forward price–earnings basis, according to Thomson Reuters I/B/E/S data.

Chinese companies end the year as Asia’s top borrowers | South China Morning Post **New area of major concern** Syndicated loans raised on the mainland by Chinese borrowers reached a record, equivalent to US$116.9 billion, helping push total loan market volume in Asia-Pacific excluding Japan to US$461.9 billion – up a massive 51 per cent, according to data from Thomson Reuters LPC, the industry’s benchmark data provider.

Overcapacity still a problem: MIIT – BUSINESS – Globaltimes.cn China’s industrial enterprises still face the problem of overcapacity, the country’s industry watchdog said Monday, noting that domestic demand will face downward pressure in 2014.

Since 2012, the overcapacity concern has started spreading from traditional industries – including iron, steel and chemicals – to emerging ones such as carbon fiber and solar power, and capacity utilization is less than 75 percent in some sectors, according to a report posted by the Ministry of Industry and Information Technology (MIIT) on Monday.

China to subsidize high-tech clusters |Industries |chinadaily.com.cn Each cluster will receive government subsidiaries of up to 100 million yuan ($16.4 million) and policy preferences, it added, citing officials from the Ministry of Science and Technology.

A total of 100 clusters are scheduled to be covered by the end of 2015, according to the ministry.

Plunging gold hasn’t lost shine in Chinese consumers’ eyes – People’s Daily Online **Nice and tangible** Gold prices are down this year, breaking a 13 year winning streak in China.

But instead of worrying Chinese consumers, lower prices mean they’re buying more of the yellow metal as the country has already become the world’s largest for gold trade.

China Regulator Gives IPO Green Light to First Five Companies -Caijing Five Chinese companies are ready to launch their initial public offering in early January as the first batch to be approved to raise funds from the country’s stock markets after a year-long moratorium.

Three of them choose to be listed on ChiNext, China’s Nasdaq while the other two are going for the over-the-counter stock exchange and the Shanghai Stock Exchange respectively.

China’s December New Home Prices Rise Most in 2013, SouFun Says – Bloomberg **This won’t end until bank savers can get over inflation** The average price rose 12 percent from a year earlier to 10,833 yuan ($1,789) per square meter (10.76 square feet), SouFun Holdings Ltd., the nation’s biggest real estate website owner, said in an e-mailed statement based on a survey of 100 cities. Prices climbed 0.7 percent from November.

China Moves Slowly Toward State Sector Overhaul – China Real Time Report – WSJ China’s government holding company – the state-owned Assets Supervision and Administration Commission – earlier this month said it would push forward with the transformation of state-owned enterprises into joint stock companies and encourage private sector investment in some areas. SASAC, which holds controlling shares of 113 companies, says the government would retain 100%  ownership in sectors which are “vital to national security” or “the lifeblood of the economy.”

Chinese Women ‘Name and Shame’ Companies They Say Discriminate – NYTimes.com **Good on ’em** Eight young Chinese women, most of them university students facing a tight job market, have “named and shamed” dozens of Chinese companies they say are illegally specifying that only men can apply for certain positions. They have mailed their complaints to government human resource departments in the cities of Beijing, Guangzhou and Nanjing, and in Yunnan and Henan Provinces.

Asia’s Worst Performer of 2013 – Shanghai – China Real Time Report – WSJ **Down 66% since 2007** Down 7.5% in early trading in the last session of the year, the Shanghai Composite is one of only two regional markets to suffer losses this year. Indonesia, a country now widely shunned by investors due to concerns over the health of its economy, is down 1%.

This is the fourth consecutive year that the market has produced a lackluster performance, and is down 36% since the end of 2009. Last trading at 2103.67, the depressed level of the market is a far cry from the peak of around 6000 points it reached in 2007, when the Chinese economy was white hot and investors piled into stocks.

China Considers Newly Proposed Free Trade Zones | China Briefing News Southern Weekend, a news agency in China, reported that there have been 13 regions of China showing interest in building regional FTZs since the Shanghai FTZ launched in September, and at least four of them have submitted applications to the State Council or other relevant government departments, including Guangdong, Tianjin, Qingdao and the Liangjiang New Area of Chongqing. According to Southern Urban Daily, an affiliated news agency of Southern Weekend, there may even be a batch of FTZs receiving approval next year.

Graphics: For Property Market, a New Year Told the Same Story – All but one of the 70 cities monitored by the National Bureau of Statistics reported that housing prices in November were higher than in the same month last year, new data shows. The monthly growth rates of 26 cities were above 10 percent.

A report by the property research institute China Index Academy examined the market from different perspectives, but it also found soaring prices for apartments.

Views: Housing Bubble? – Real estate has been a hot topic in China for at least a decade. Prices continued to climb last year, despite price control policies enacted by both central and local levels of governments. Caixin spoke to experts about the prospects for the real estate industry in 2014 and whether or not a bubble exists.

Yearender–Xinhua Insight: China’s urbanization puts people at center – Xinhua | English.news.cn **Story disproves title** China’s new approach to urbanization has made the year 2013 a turning point, especially for the 260 million migrant workers who await the benefits of the change.

China’s hukou system ties public services such as health care and education to residential status. Those without local hukou are usually barred from sending children to public schools and many, particularly migrants, are left with few choices but to send children to schools back home. Those without local hukou also face tougher restrictions on housing and car purchases.

Regional Variations of the Urge to Splurge in China – Businessweek It’s no simple task to design advertising campaigns meant to appeal to 1.3 billion people living in diverse circumstances across China. A new study (PDF) by consumer researcher GroupM (WPP:LN) in Shanghai maps the geography of China’s luxury and high-end consumers, teasing out regional variations of the urge to splurge.

Broadly speaking, shoppers in China’s less developed central and southwestern regions tend to be more pragmatic and price-conscious, even those with extra cash to spend on luxury goods. Meanwhile, those in northern and eastern China, who often have longer exposure to brands, are more sensitive to what the study calls “emotional influences,” including brand loyalty, product packaging, and advertising campaigns.

COMPANIES

ICBC fell from top spot as world’s biggest lender – Headlines, features, photo and videos from ecns.cn|china|news|chinanews|ecns|cns The Industrial & Commercial Bank of China, with a market value of 213.7 billion U.S. dollars ending Monday, fell to the fourth place from the previous top spot, trailing behind Berkshire Hathaway Inc (291.1 billion), Wells Fargo Bank (239.7 billion) and JPMorgan Chase (236.4 billion), according to Bloomberg calculations.

The Chinese lender surpassed Citigroup in July 2007 to become the world’s biggest bank. Its six-year reign had been interrupted only once when it was eclipsed by HSBC Holdings PLC in September 2008, if not taking into account of recent ups and downs since June this year.

Initial Apple iPhone orders on China Mobile underwhelming AAPL CHL – Investors.com **Didn’t think this would be the panacea some hoped. There was a hint of desperation** Apple investors cheered the company’s long-awaited distribution deal with China Mobile, the world’s largest wireless carrier, after it was announced Dec. 22. But early reports show China Mobile iPhone orders lagging what other carriers experienced when they began selling Apple’s latest smartphone, Wedge Partners analyst Jun Zhang said.

China Mobile Expands 4G Lineup as Samsung to Sony Add Handsets – Bloomberg China Mobile Ltd. (941) is selling 13 handsets for its fourth-generation network, up from four devices at the start of service three weeks ago, as market leader Samsung Electronics Co. (005930) and rivals vie for early adopters.

Samsung’s Note 3 is available for 5,399 yuan ($892) before subsidy at China Mobile’s store at the carrier’s Beijing headquarters, in addition to the Note 2 that went on sale earlier this month. The Note 3, the most costly device offered on the 4G network, is available free with China Mobile’s most expensive monthly service plan of 488 yuan.

Late Start May Be Tempering China Mobile’s iPhone Preorders – John Paczkowski – Mobile – AllThingsD How is it that China Mobile, which currently provides cell service to over 763 million customers, is pulling in fewer iPhone preorders than its smaller rivals? One thing to keep in mind: It’s still early and this is only a single estimate. Another: The 5s and 5c are two months old now, and China Mobile isn’t doing much to differentiate them on its network. According to Wedge, its subsidies are similar to China Telecom’s and slightly higher than China Unicom’s.

How Baidu Beat the Market in 2013 This year in many ways represented a reversing of fortunes for Baidu. After being driven down over the past 18 months as the result of several emerging threats to its core search business, Baidu defied the doubters this year by posting several impressive quarterly performances

Baidu, QVOD fined 250,000 yuan each for video copyright violations – BUSINESS – Globaltimes.cn **Barely a rap on the knuckles** Baidu Inc, China’s largest search engine company, and Shenzhen-based software company QVOD Technology were identified as the top two violators of copyrighted video content for 2013 and have both been ordered to stop the copyright infringement and slapped with a penalty of 250,000 yuan ($41,225) each, an official with the National Copyright Administration said Monday.

Tech in China: WeChat Still Rules Chinese IM Industry, Rivals Mull to Catch Up **WeChat over double the # of Twitter users** The users of IM tools recorded metric growth this year led by WeChat which now registered more than 600 million users, with more than 100 million overseas and 271.9 million monthly active users in Q3 2013.

Location-based social app Momo has registered 80 million users and 13 million daily active users after two years and three months of development.

Xiaomi aims to double phone sales to 40 million in 2014 We’re hours away from the start of 2014, but the founder and CEO of young Chinese phone-maker Xiaomi is already thinking ahead to the end of next year. In a post on his Weibo page, Lei Jun says the company is aiming to ship 40 million phones in 2014.

Delivery firm cancels IPO |Companies |chinadaily.com.cn **Nice euphemism** China Postal Express and Logistics Co Ltd, the State-owned express courier company, has withdrawn its application to go public amid strong competition from domestic rivals in the 198 billion yuan ($32.7 billion) express delivery market.

The State-backed firm, known as EMS, cited “strategic adjustment” issues as the major reason behind the IPO pullout, according to a company statement.

Building Capacity — Beijing Review “Huawei is now the largest ICT service provider in Africa,” said Gao, “Alcatel-Lucent and Ericsson now lag far behind us.”

The same thing happened to the Chinese Civil Engineering Construction Corp. (CCECC) Nig. Ltd. When CCECC first set foot on the continent, German companies controlled the lion’s share of the construction trade. The company tried valiantly but struggled to gain a foothold. Decades of hard work finally paid off though, and CCECC is now the leading construction company and contractor in Nigeria.

New Ford Transit models recalled in China – People’s Daily Online **Who does the QC?! Looks awful for Chinese manufacturers** Chinese automaker Jiangling Motors Co., Ltd.began recall of 8,638 New Ford Transit vehicles on Monday, according to China’s quality watchdog.

The recall involves New Ford Transit models manufactured between June 17, 2012 and Feb. 20, 2013, the General Administration of Quality Supervision, Inspection and Quarantine said in a statement.

Baotou Steel Plans $4.9 Billion Share Issue to Buy Assets – Bloomberg Inner Mongolian Baotou Steel Union Co. (600010), a Chinese steelmaker, will raise as much as 29.8 billion yuan ($4.9 billion) in a private share placement to buy assets from its parent and replenish working capital. The stock jumped.

The board approved a plan to sell as many as 8.26 billion shares in Shanghai at 3.61 yuan apiece, the Baotou, Inner Mongolia-based company said today in a statement. That compares to the 3.92 yuan the stock last traded at on Oct. 31.

China Everbright in HanKore Water Agreement Plans Majority Stake – Bloomberg China Everbright International Ltd., a developer of water and environmental protection projects, plans to inject all water-industry investments into HanKore Environment Tech Group Ltd. (BIOT) in exchange for a majority stake in the company, according to a Hong Kong exchange filing.

China Everbright signed a framework agreement with Singapore-listed HanKore, which will issue consideration shares at S$0.0703 each and become a subsidiary on completion of the accord, according to the statement. Terms will be finalized following due diligence and the signing of a definitive agreement, China Everbright said.

Carlsberg plans $250 million expansion in China – MarketWatch **Smart move – big market, poor quality** Carlsberg said Monday it is buying 100% of Chongqing Beer Group Assets Management, a holding company that owns eight breweries in three different provinces of China. Chongqing Beer Group’s breweries primarily sell brands licensed from Chongqing Brewery Company Co. Ltd, majority-owned by Carlsberg, as well as the brand Tianmuhu.

BOC, AVIC, Samsung Jointly Tap Mainland Insurance Market | 4-Traders BOC Insurance wholly owned by Bank of China Limited (BOC, SEHK: 3988 and SHSE: 601988), China Aviation Industry Corporation (AVIC) and Samsung Life Insurance inked agreement for shareholding in Samsung Air China Life Insurance to jointly promote mainland service.

BOC will put additional investment in Samsung Air China Life Insurance through BOC Insurance and the target company will have capital base of KRW 144 billion or CNY 830 million.

China Mobile Ltd. : China Mobile 100G Backbone Network Procurement in Price War | 4-Traders Following centralized procurement in early 2013 and additional procurement in September for 100G optical transport network (OTN) equipment, China Mobile Ltd. (SEHK: 0941 and NYSE: CHL) started a new round of centralized procurement for national backbone network in early December. Dividing into three bid sections respectively for northeast, east and west regions, the procurement covers more than 80% provinces, municipalities and autonomous regions.

Beijing Auto | Beijing’s BJ40 SUV Hits The Market at 146,800RMB and Rising | China Car Times – China Auto News The BJ40 was first announced in late 2009 and aired in 2010 at the Shanghai Auto Show where it wowed both the media and the public at large. Over the past few weeks the BJ40 was rumored to be launching with a 200,000RMB price tag which was considered extremely steep for a Chinese branded two door SUV, instead Beijing has come back with a low cost price tag of 146,800RMB rising to 186,800RMB over a three model range.

Posted from Diigo.

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China Business Briefs 25/12/13

Merry Xmas everyone.

 

ECONOMY

China treasury bond futures close higher — Dec. 25 – Xinhua | English.news.cn China’s treasury bond futures closed higher on Wednesday, with the contract for settlement in March 2014, the most actively traded, went up 0.12 yuan to finish at 91.792 yuan (15.01 U.S. dollars).

The contract for settlement in June 2014 closed at 92.238 yuan, up 0.05 yuan.

China Considers Rule Change for Challenging Land Disputes – WSJ.com A subgroup of China’s legislature began considering draft amendments that would strengthen a law governing how ordinary citizens can appeal government decisions by opening new channels for them to sue official bodies, the state-run Xinhua News Agency reported Tuesday. The agency said the amendment, if adopted, would be the first adjustment in the Administrative Procedure Law since its 1990 adoption.

Even A Dog Can Run China’s Banking System, Says Former State Council Spokesman China’s banks are a different breed of financial institution. They enjoy lucrative interest margins during good times, and when things head south, the state is there to clean up things up. In fact, the former chief economist and spokesman of China’s National Bureau of Statistics went so far as likening (in Chinese) the nation’s banking system to an automated system that even a dog could successfully run.

Golden age of SOEs draws to close amid reforms – BUSINESS – Globaltimes.cn Looking ahead, the future holds little more than the promise of new challenges and uncertainties. Based on official statements made since November’s third plenary session, the central government is clearly determined to press ahead with further market reforms designed to turn SOEs into truly competitive commercial entities.

Dependency on natural gas imports rises |Industries |chinadaily.com.cn Up to 32 percent of China’s natural gas use this year will depend on imports, Wang Xiaokun, an analyst at domestic commodities consultancy Sublime China Information Group Co Ltd, said on Tuesday.

Last year, 29 percent of China’s natural gas came from foreign sources, according to the consultancy’s estimates based on data from the National Bureau of Statistics and import data from the customs office.

Members Only No More: China’s Graft Crackdown Nixes Private Clubs for Officials | TIME.com Tony private clubs are the latest target of China’s anti-corruption crusaders, joining extravagant banquets and flashy cars as off limits for officials. Communist cadres must promise that they will refrain from belonging to or even visiting private clubs, said a Dec. 23 circular from the Central Commission for Discipline Inspection, the body charged with cleaning up government ranks amid allegations of widespread abuse of power and graft within the ruling party.

Yuan Trades Near 20-Year High as Yield Gap Seen Luring Capital – Bloomberg The yuan traded near its strongest level in 20 years on speculation the widening yield advantage on Chinese assets will attract capital inflows.

The People’s Bank of China boosted the currency’s reference rate for a second day today, raising it by 0.03 percent to 6.1145 per dollar. The yuan is up 2.6 percent this year, the best performance among 11 most-traded Asian exchange rates tracked by Bloomberg. The yield premium on Chinese one-year government bonds over similar-maturity U.S. notes increased by 1.4 percentage points to 4.1 percentage points in 2013, according to data compiled by Bloomberg.

China names new state assets regulator chief The State-owned Assets Supervision and Administration Commission (SASAC) said late on Tuesday that Zhang Yi had been appointed, replacing Jiang Jiemin.

Zhang was previously SASAC’s deputy head, and prior to that had worked as secretary-general for the ruling Communist Party’s anti-corruption watchdog.

Most employers to raise bonuses – BUSINESS – Globaltimes.cn About 64 percent of employers in China plan to raise annual bonuses for their employees in 2013, while another 23 percent mull cuts, according to a report released by Career International Consulting on Tuesday.

The overall increase will be slight, as 47 percent of respondents said the bonus increase will be less than 10 percent, and only 3 percent plan to offer raises of more than 20 percent, according to the report, based on a survey of 847 companies in China conducted in late November.
The company’s hepatitis B vaccines have come under scrutiny since authorities suspended their use for liver disease after the first deaths of babies were reported.

Alibaba spinoff moves further into the cloud[1]|chinadaily.com.cn Aliyun, Alibaba’s spinoff cloud-computing division, is scheduled to set up data centers outside China to provide cloud-computing services to local enterprises and Chinese companies’ overseas operations, the company announced on Tuesday.

By building platforms for companies to manage and store data in the cloud, Aliyun will become the first Chinese company to reach out to the foreign public cloud segment, days after its US counterpart Amazon announced the launch of a similar services in China.

Notable Two Hundred Day Moving Average Cross – SNP – Forbes In trading on Monday, shares of China Petroleum & Chemical Corp. Inc (NYSE: SNP) crossed below their 200 day moving average of $79.88, changing hands as low as $79.64 per share. China Petroleum & Chemical Corp. Inc shares are currently trading down about 0.8% on the day. The chart below shows the one year performance of SNP shares, versus its 200 day moving average:

Bank of China Limited : BOC Releases Mobile Payment APP | 4-Traders The “BOC Mobile Payment” APP integrates multiple mobile payment products including BOC swift payment, payment via mobile banking, and payment by agreement, covering all the day-to-day mobile payment demands in a bid to create a customized mobile cashier desk for customers. Besides the mobile payment function, the “BOC Mobile Payment” APP also features such functions as inquiring about electronic payment transaction records, opening and closing various electronic payment transaction functions, and setting the transaction limit.

Banks announced $57.3 billion in refinancing – Headlines, features, photo and videos from ecns.cn|china|news|chinanews|ecns|cns Ten banks announced a 348.2 billion yuan ($57.3 billion) refinancing plan this year, reflecting the pressure on capital flow in the banking industry, Beijing-based Securities Daily reported.

China Minsheng Banking Co Ltd, Industrial Banking Co Ltd, Bank of Chongqing Co Ltd, Huishang Bank Co Ltd, and China Everbright Bank Co Ltd were some of the banks to complete refinancing.

Coal Giant Looks to Northern Neighbors to Satisfy Investment Hunger – As many in the coal industry have started to cut their assets or searched for new investments amid a market slump, Shenhua Group Co. has adopted another approach, aggressively seeking assets overseas.

China’s largest coal enterprise announced on December 11 it won license to jointly explore for coal and develop the Zashulanskoye deposit in the Transbaikal Territory with Russia’s En+ Group. The deposit is close to the Russia-China border. The deal came just after a late October announcement that Shenhua signed an agreement with the government of Mongolia to develop the Tavan Tolgoi thermal coal deposits in southern Mongolia and to build rail links from that site to China. Earlier, media reports also said that Shenhua was exploring investments in several coal mines in Australia.

The shale gas project, which has 25 gas wells, is located in Pennsylvania and is expected to produce 3.8 billion cubic meters gas in the first 30 years.
The key to the deal is Novus’ 57,000 net hectares of drilling leases in the Saskatchewan Viking play. It produces about 4,000 barrels of oil equivalent per day, more than 80 per cent of which is light crude oil.
China National Petroleum (PTR) and Gazprom agreed in September on the basic terms of an agreement, including volume, the date of the first delivery, payment and a take-or-pay amendment, but both countries failed to secure the most important detail: a price.

The term facility attracted banks from Asia, North America, Europe, Australia and the Middle East and pays a margin of 1.23 percent, the statement from United Overseas Bank Ltd. and the Royal Bank of Scotland Group Plc said. Tiptop Energy Ltd. and Sinopec Century Bright Capital Investment Ltd. are the borrowing entities and the facility is guaranteed by Sinopec Group, as China Petrochemical is more commonly known.

Posted from Diigo.

China Business Briefs 21/12/13

ECONOMY

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

COMPANIES

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Posted from Diigo.

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.

China Business Briefs 17/12/13

Shoppers dropping department stores |Industries |chinadaily.com.cn **No wonder. They are painfully inefficient** Department stores in China’s big cities likely will face increasing pressure to be profitable in 2014 due to mounting consumer preference for other retail formats, rising rents and a shifting of growth to lower-tier cities, analysts and market insiders said.

A report by Fitch Ratings put China’s department store outlook in 2014 as “negative” despite an anticipated mild acceleration in sales growth, as stiff competition and customers drawn to other sales channels will continue to challenge the sector’s recovery.

China Adds to U.S. Treasury Holdings – WSJ.com China boosted its holdings by $10.7 billion in October to $1.3045 trillion, according to the latest monthly data released by the Treasury Department on Monday. Foreign investors overall added $24.4 billion in U.S government-debt holdings. China primarily bought T-bills due in one year or less, with $8.4 billion added in the month.

You don’t need to work with this taxonomy for long to discover that it is inadequate. Hybrids abound, and there are a growing number of firms that do not fit neatly into these distinctions.

Last month, state-owned PetroChina became the first Chinese company to announce it had bought CCERs, paying renewables firm Longyuan 16 yuan ($2.62) a piece for 10,000 credits.

Fall in copper futures ends seven-day rise – BUSINESS – Globaltimes.cn The Shanghai benchmark copper contract for delivery in February declined by 0.78 percent on the Shanghai Futures Exchange (SHFE) Friday compared to Thursday, ending at 51,160 yuan ($8,429.59) per ton.

China’s PetroChina receives notice from U.S. court on probe into executives | Reuters **Not just officials being taken down. President Xi’s campaign is claiming numerous ‘tigers’** China’s oil giant PetroChina Co Ltd has received a notice from a U.S. court related to a complaint involving its former and current chairmen on suspected violations of U.S. securities regulations.

PetroChina, which with its parent China National Petroleum Corp has been embroiled in a major corruption probe by Chinese authorities, is unaware of amounts related to the complaint, it said in a filing to the Hong Kong and Shanghai stock exchanges on Tuesday.

Kunlun Energy Chairman Resigns as Government Graft Probe Widens – Bloomberg **”Helping”** Wen Qingshan quit with immediate effect as both chairman and director of the company due to personal matters, Kunlun Energy said in a statement to the Hong Kong stock exchange.

Kunlun suspended its shares following a report in China’s Caixin magazine yesterday that Wen is helping in a government graft probe. Wen was taken into custody to assist with an investigation, a person with knowledge of the matter said today, asking not to be identified as he wasn’t authorized to speak publicly about it.

China Everbright Bank Co. Ltd (SHA:601818) ‘Admits’ To 6.5 Billion Yuan Interbank Loan Default **Was this due to conditions then, or a more systemic problem?** China Everbright Bank Co. Ltd. (SHA:601818), the country’s 11th-largest bank by assets, finally admitted that it had defaulted somewhat on 6.5 billion yuan ($1.07 billion) worth of a loan it was due to repay to another bank back in June.

Shortly after the June 5 liquidity squeeze that sent interbank lending rates soaring to as high as 30 percent, media reports started to circle that Everbright failed to repay a loan borrowed from Industrial Bank Co. Ltd. (SHA:601166) on time because of tight liquidity conditions.Huwei

Tencent’s Ma Becomes China’s Second-Richest Man on WeChat Mania – Bloomberg **Two years ago all the attention was on Sina because of its weibo, but it never made money – too much oversight required. WeChat is I think the first world-class Chinese tech product** Ma Huateng, chairman of Asia’s largest Internet company Tencent (700) Holdings Ltd., overtook property tycoon Wang Jianlin to become China’s second-richest man, according to the Bloomberg Billionaires Index.

Ma has a net worth of $12.1 billion, surpassing Wang by $100 million, according to the daily index. Tencent shares have soared 90 percent this year in Hong Kong trading, compared with a 2.5 percent increase in the benchmark Hang Seng Index.

InterDigital execs threatened with arrest in China | Politics and Law – CNET News **Sometimes you shake your head and wonder** To discuss the matter, the NDRC proposed a meeting with InterDigital CEO Bill Merritt on December 18. Merritt replied that he’d be unavailable that day as he’s scheduled to attend a board meeting, reported Reuters. Instead, he suggested sending some of his key executives, and apparently the NDRC didn’t like that suggestion.

In a letter seen by Reuters, InterDigital said the NDRC told its attorney that it would not ensure the safety of any executives sent in place of Merritt and that they could be arrested or detained. So it’s safe to say that those executives won’t be taking that trip to China.

Although the first Mexican opportunities may go to the major independent oil companies in the U.S. and Europe, Chinese groups such as Cnooc (CEO) and Sinopec (SNP) will actively seek opportunities; Mexico’s president plans to visit Beijing in 2014 and his trip may reveal whether Chinese firms are acceptable partners.

The first chunk of US$35mln has been fully subscribed for by GIC Private Limited, the Singapore sovereign wealth fund, and future issues of the bond will be at the discretion of the company.

Chinese drinks maker Want Want has said it plans to reduce imports to diversify its supply chain, and at least two multinational infant formula sellers have either cut supply from Fonterra or plan to diversify supply for the China market, people in the industry told Reuters.

KFC restaurants in China are still plagued with low sales, as consumers are still in doubt over the safety of their food. To convince consumers that its food is safe, Yum! has taken to social media outlets to promote the safety of its food. The company has also rolled out a mobile app to bring customers back by offering coupons and the option to pay for orders through a mobile device.

The company is to construct an energy-efficient commercial building in Tanzania’s commercial capital, Dar es Salaam. Predictions are it will one of most populated cities in 20 years due to the magnet of natural resources.

Shares in CP Lotus fell 4.3 per cent yesterday while those of Chinese supermarket operator Wumart fell 0.2 per cent in Hong Kong, reflecting dashed hopes of a tie-up that was seen as an example of needed money-saving consolidation in China’s increasingly competitive retail market..

The French carmaker said it would expand its current vehicle line-up to manufacture near-premium sport utility vehicles (SUV) in 2016 with the Chinese group, which has an existing venture with Nissan. Renault owns 43.4 percent of Nissan Motor Co.

ASF Group raises $6.3M for working capital – Proactiveinvestors (AU) ASF’s partners are China Communications Construction Company – third largest construction company in the world, Guangzhou Dredging Co Ltd and China State Construction Engineering Corporation Limited.

Posted from Diigo.

China Business Briefs 9/12/13

China’s Hot Money Headache – China Real Time Report – WSJ China reported strong export numbers on Sunday, in part due to demand from Western nations ahead of the holiday season.

Some observers think another factor could be at play: Companies overstating the value of exports as a way to circumvent rules that restrict the flow of capital into the country.

China Bank Funding Set to Ease With Certificate of Deposits – Bloomberg Chinese banks’ funding constraints are set to ease after policy makers authorized the sale of certificate of deposits in a move toward loosening control over interest rates in the world’s second-largest economy.

The prices for negotiable certificate of deposits, or NCDs, will be set by trading on the interbank market, with the Shanghai Interbank Offered Rate used as a reference rate, the People’s Bank of China said in a statement yesterday. Deposit-taking firms are permitted to sell NCDs of at least 50 million yuan ($8.2 million) to other financial institutions under rules that go into effect today.

PBOC Said to Be Talking to Major Banks about Deposit Insurance – The central bank has been consulting executives of major banks  about creating a deposit insurance mechanism and may announce a draft plan early  next year, a source close to the situation said.

China says poorly prepared to fight impact of climate change | Reuters China is poorly prepared to tackle the impact of climate change that presents a serious threat to the country, thanks to a lack of planning and public awareness, the government said on Monday.

The world’s most populous country already faces challenges from weather extremes, with 2,000 people dying on average each year since the 1990s in natural disasters that are set to get worse, China’s powerful economic planning agency said.

Enlight shares rise due to ‘The Four 2’ – BUSINESS – Globaltimes.cn Beijing Enlight Media Co, one of China’s biggest private media and entertainment companies, saw its shares surge on Friday, which analysts attributed Sunday to positive market expectation for its Friday-released 3D Chinese hero film The Four 2.

Everbright Bank Said to Seek $2.8 Billion in Hong Kong Offering – Bloomberg The lending unit of state-controlled China Everbright Group is offering 5.06 billion new shares at HK$3.83 to HK$4.27 apiece, said the people, who asked not to be identified because the information is private. Shares of Beijing-based Everbright Bank have traded in Shanghai since 2010.

Tencent to Invest RMB10 billion in Financial Services including WeChat Payments, CEO Says The Chinese Internet giant has registered several companies on e-commerce and finance there with RMB1.6 billion (more than $200 million) in total registered capital, according to Mr. Ma. The businesses those companies will cover include WeChat Payments, online financial services, foreign currency exchange, etc.

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China Business Briefs 20/11/13

China’s central bank will “basically” end normal intervention in the currency market and broaden the yuan’s daily trading limit, Governor Zhou Xiaochuan said, without giving a timeframe.

The daily range will be widened in an “orderly way” as China seeks to enhance the currency’s two-way flexibility, Zhou wrote in an article in a guidebook explaining reforms outlined last week following a Communist Party meeting. The nation will phase out investment caps for both domestic and foreign investors, he added. A ceiling on deposit rates offered by local banks will be gradually removed as well, PBOC Deputy Governor Yi Gang wrote in the book.

China’s National Bureau of Statistics (NBS) plans to revise the current system of measuring the national economy in line with latest international standards, an NBS official said.

The new system will reckon spending on research and development as a form of fixed capital and calculate it into gross domestic product (GDP), NBS vice head Xu Xianchun said in an interview which was available at http://www.xinhuanet.com on Monday.

The ruling party has promised to turn the nation’s current approval-based  system of initial public offerings into a “registration-based” one which is  expected to end a year-long moratorium in the IPO market.

The surprising move will return power to the market as well as investors,  Xiao said Tuesday in a keynote speech at the Caijing Annual Conference 2014.

China’s service trade grew 13.4 percent year on year in the first nine months of 2013 to reach 390.5 billion US dollars, official data showed on Tuesday.According to the Ministry of Commerce, service exports rose 6.8 percent from the same period last year to 146.4 billion dollars, while imports surged 17.8 percent to 244.1 billion dollars.

China’s foreign direct investment in October went up 1.2 percent from a year earlier to $8.4 billion, the Ministry of Commerce said Tuesday.
The first 10 months of this year saw FDI inflow rise 5.8 percent year-on-year to $97 billion, the ministry said. But the number of new enterprises established by foreign investment declined 9.2 percent year-on-year to 18,184.
The GDP of Binhai New Area, a new growth hotspot near the Bohai Bay in north China, is expected to exceed 800 billion yuan (130 billion U.S. dollars) in 2013, a local official said Monday.
Rather than cutting them down to size, as liberals had hoped, President Xi Jinping instead enshrined their position at the commanding heights of the Chinese economy. The “public sector remains the important pillar of the economy”, the Communist party said in its statement published following last week’s plenum.
But that language is deceptive. Reforms in train in China amount to a significant, albeit indirect, challenge to state companies across a range of industries, chipping away at their privileges. The government does not want to eliminate them. Instead, it wants to make them more efficient and more profit-focused – in short, more like private companies.

So far, secondary market activity in Asia has been more of a gradual flow than a wave of deals. But the changing macroeconomic conditions are increasing pressure on GPs – and that could result in more opportunities, particularly in China. Asia’s largest and most attractive market is losing some of its shine, thanks to a sustained slowdown in annual GDP growth and a frozen IPO market that has left GPs holding assets that they need to exit.

“If you could do [secondaries] at this moment – wow,” says Peter Fuhrman, chairman and chief executive of China First Capital. “In this market, some LPs could sell out for 10 cents on the dollar.”

China’s asset bubble increasingly depends on financing from the shadow  banking system. The carry trade – borrowing dollar loans at low interest rates  offshore and converting the loans into yuan, either disguised as foreign direct  investment or export revenue, for lending at a high interest rate – has become a  significant source of funding in the shadow banking system. The recent surge of  land prices in big cities may be due to it.

The rising share of unstable financing for the country’s asset bubble  threatens a chaotic ending. If the bubble suffers a confidence crash or a  receding tide of liquidity, the unwinding of speculative holdings would be  chaotic, causing a hard landing.

Companies

The acquisition will provide Alibaba access to Umeng’s tools and data. At the moment, the analytics firm supports Android, iOS, and Windows platforms, and is being used in over 180,000 apps by over 60,000 developers. As Alibaba aspires to enhance its mobile portfolio, Umeng’s resources will give the tech giant yet another channel through which it can reach out to developers.
A senior manager of Aluminum Corp of China (Chalco), the country’s largest smelter of the lightweight metal, has become the latest in a series of high-level executives at central government-administered enterprises to be investigated by Beijing.
Vice-president Li Dongguang was under investigation “by relevant authorities for personal reasons”, Chalco said in a statement to Hong Kong’s stock exchange without elaborating. “The investigation has no relation whatsoever to the company,” it said, adding Li had tendered resignation from his post and that the resignation had no noticeable impact on its production.
The reasons for J.P. Morgan’s voluntary exit from the IPO just weeks before the Chinese bank’s expected debut on the Hong Kong Stock Exchange in December weren’t immediately clear. But it comes as the Wall Street bank grapples with several investigations by regulators, including one by the Securities and Exchange Commission and the Justice Department into its hiring of bankers connected to Chinese officials.
VANCOUVER, Nov 19 (Reuters) – China’s Sinopec Corp  is in serious talks on a site for a potential liquefied natural gas (LNG) export terminal in British Columbia, the province’s Minister of Natural Gas Development said on Tuesday.
LightInTheBox Holding Co. (LITB) plunged 23 percent, leading declines among Chinese stocks traded in New York, after the online discount retailer’s sales forecast trailed analyst estimates.

Chinese firms’ addiction to distressed global assets was back in the spotlight last week, with word that car maker Dongfeng Motor is nearing a deal to purchase struggling French automaker Peugeot. This pursuit of a global brand is consistent with Beijing’s call for Chinese firms to go global, and would certainly allow Dongfeng to quickly expand onto the world stage.

But the case marks yet the latest example of a Chinese firm pursuing a global brand fraught with problems, which could quite possibly represent a dead end for Dongfeng if Peugeout is forced to downsize or even close. To avoid such an outcome, Beijing should veto this deal on the grounds that Dongfeng stands to inherit major problems and incur big losses if the partnership goes forward.

In August, Tencent announced that it would out-do rivals Baidu and Qihoo 360 by offering 10 times as much free cloud storage as them. However, the product is so far available only in Chinese. To use it, you have to sign up for a Tencent QQ account and download the latest version of the Tencent Cloud (Weiyun) mobile app. Tencent starts you off with with 1TB of free space, which should be more than enough for most human beings, and increases that number as you fill the space. By contrast, Dropbox offers 2GB of free space and Google Drive offers 15GB. That’s chicken feed to Tencent.

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