Trade
IPR
Political and International
News
National People's Congress
Economy
Healthcare
Foreign Investments
Food/Consumer Product
Safety Issues
Energy & Environment
Insurance & Finance
Cross - Straits
General News
US Chamber China Trade & Investment News
June 03, 2008
Trade
June 03: The European Union will impose anti-dumping duties on citric acid from China,
the latest product from the Asian export powerhouse to fall foul of the bloc's trade rules.
The punitive duties mostly range between 39 and 49 percent for the Chinese producers of
citric acid which is used as an ingredient for food and beverage producers, a notice in the
EU's Official Journal said. In recent years the EU has hit Chinese goods such as leather
shoes and energy saving light bulbs with anti-dumping duties and other big cases are in
the pipeline, including anti-dumping investigations into imports of Chinese steel products.
The Guardian
June 03: Chinese pipe exporters have to give up the US market as US Department of
Commerce (DOC) announced to impose astonishing retaliatory duty. DOC has decided to
levy a 700% import duty on standard pipes from China including a record high 615%
countervailing duty. China's Shuangjie Group got a CVD of 615.92% besides an anti
dumping duty of 85.55%. DOC also announced to impose separate rates on other 31
Chinese exporters. The International Trade Commission is scheduled to make its final
injury determination on or about July 14th 2008. However, as the CVD is based on
Chinese government, enterprises can hardly prepare any defense.
Steel Guru
IPR
June 03: The China Audio and Video Copyright Collective Management Association,
which has been brewing for about ten years, have been formally set up in Beijing to
implement China's "Copyright Collective Management Rule". Zhang Zhenhua, has been
elected as the president, and Wang Huapeng as vice president, secretary-general and
legally responsible person for the association. The association will manage audio and
video program related issues such as the right of performance, right of broadcasting, right
of leasing, right of Internet broadcasting and right of duplication and distribution.
China Tech News
June 03: Chinese and international record companies called for an advertiser boycott of
Baidu.com Incorporation, the country's leading search engine by search volume, over
complaints of music piracy. "Resolutely countering Baidu, which is the largest and most
incorrigible purveyor of pirated music in China, has become a common goal in China," the
companies said in a joint statement with industry associations including the Music
Copyright Society of China and the International Federation of the Phonographic Industry.
The Wall Street Journal; Bloomberg
Political and International News
June 03: State Under Secretary Rood will travel to China for security dialogue on June 04,
2008.
China Trade Extra
June 03: Zha Peixin, vice chairperson of the Foreign Affairs Committee of the NPC and
chairman of the NPC-EP Relations Group, said that the National People's Congress (NPC)
of China and the European Parliament (EP) should contribute more to the long-term
healthy development of Sino-European Union relations and serve as an important impetus
to the further promotion of the ties. According to him to enhance Sino-EU relations, the
NPC and EP should deepen mutual trust, and look at the other side's development more
positively.
China Daily
June 03: Defense Minister Liang Guanglie met with visiting Egyptian armed forces' chief
of staff Sami Hafez Enan, pledging to step up friendly military cooperation. Liang, also
state councilor, hailed the development of China-Egypt relations, saying that China's
armed forces value their friendship with the Egyptian military and would work with Egypt to
increase cooperation. According to Enan the Egyptian armed forces are ready to promote
friendly cooperation and exchanges with China.
Xinhua
June 03: Beijing promised to fight "ambush advertising" during the Olympic Games that
threaten official sponsors, saying organized groups of spectators wearing competing brand
logos would not be allowed. McDonald's, Coca-Cola and other sponsors paid tens of
millions of dollars to link their names with the Beijing Olympics. So-called "ambush"
marketers try to use the publicity surrounding the games to promote their products without
paying for the right.
The Wall Street Journal
June 03: Beijing officials are reinforcing the city with more sniffer dogs, yet another sign of
the draconian security expected to greet the Olympics when the games open in less than
10 weeks. The explosive-sniffing dogs are expected to work around Beijing's 31 Olympic
venues, the airport, subways, railway stations and shopping malls. The country's postal
service has suspended mailing parcels containing liquids until October 31.
The Wall Street Journal
June 02: China released a legal guide for foreigners about a wide range of issues such as
entry and exit information, tourism and accommodation in the country. The guide says
those who are believed to be likely to carry out terrorist, violent or subversive activities are
not allowed to enter China. China also bans the display of insulting slogans and banners in
sports venues and of those regarding religion, politics and race at Olympic venues.
The New York Times; Houston Chronicle; International Herald Tribune; Xinhua
National People's Congress
June 03: China's State Council has appointed Wang Yi as director of its Taiwan Affairs
Office to replace Chen Yunlin, according to the council. The cabinet also ended Wang's
post as vice foreign minister and Chen Yunlin's post as director of the Taiwan Affairs
Office of the State Council. At a meeting of the mainland-based Association for Relations
Across the Taiwan Straits (ARATS), Chen Yunlin was elected as chief of the ARATS.
China Daily; Bloomberg
Economy
June 02: China's central bank said it expects the country's economic growth trend to
stabilize, as the risk of overheating has decreased following the US subprime mortgage
crisis, Beijing's tight monetary policy, and recent natural disasters. However, the recent
earthquake has increased uncertainties in the economy, including a short-term increase in
inflationary pressures and a pickup in fixed-asset investment growth due to reconstruction
efforts.
The Wall Street Journal
June 02: China's economy is likely to grow 10 percent in 2008, while the 2008 inflation
rate may reach 6 percent to 7 percent according to Fitch Ratings Incorporation. The credit
ratings agency said China is likely to raise banks' reserve requirement ratio and, to a
lesser extent, interest rates to tighten domestic monetary conditions.
The Wall Street Journal
Healthcare
June 03: Health authorities vowed to push ahead with measures to ensure health of
victims and prevent any outbreak of disease following May 2008’s deadly earthquake in
Sichuan Province. Water and food safety, proper hygiene at shelters, and disposal of dead
bodies and garbage are top priorities according to the Health Ministry.
Xinhua
June 02: The few hand-foot-mouth disease (HFMD) cases that occurred recently in
China's quake-hit areas have been brought under control, according to Mao Qun'an,
spokesperson of the Ministry of Health.
Xinhua
Foreign Investments
June 03: China's foreign exchange reserves have reached $1.76 trillion by the end of April
2008. In April alone, China's foreign exchange reserves increased by $74.5 billion, the
highest rise in 2008, equivalent to a $10 million rise per hour. Earlier statistics from the
central government showed China's foreign exchange reserves expanded by $153.9 billion
in the first quarter of 2008, up 40 percent from 2007.
China Knowledge
June 03: Banco Bilbao Vizcaya Argentaria SA (BBVA) said it reached a new agreement
with CITIC Group, allowing Spain's second-largest financial group to invest about $1.25
billion to further increase stakes in two units of the Chinese banking giant. BBVA said the
investments would be considered strategic and would position the bank to tap into the
high-growth banking market in China. BBVA will also increase its ownership in China Citic
Bank to 10.07 percent, from about 5 percent at present.
The Wall Street Journal; Bloomberg
June 02: Chinese monetary policy is largely a function of massive and very volatile
speculative inflows driven by RMB appreciation. There are many ways to bring money into
China and what are driving the speculative inflows are some ambitious expectations of
RMB appreciation. The trade surplus and FDI accounts for $94 billion, but almost certainly
a large fraction of this consists of disguised hot money.
Sampa
Food/Consumer Product Safety Issues
June 03: IATP lays out provisions of US-China food safety MOA.
China Trade Extra
Energy & Environment
June 03: Beijing Economic-technological Development Area (BDA) started the campaign,
of "energy saving and emission control" for the upcoming Beijing Olympics, on April 21.
Zhao Xinxin, vice director of BDA's administrative commission, proposed that all the 2,300
enterprises in BDA should put more efforts in energy-saving and emission reduction. The
BDA administrative commission has made environment protection a top criterion to assess
any potential investment.
China Knowledge
June 03: China Datang Corporation, parent of the listed Datang International Power
Limited, announced that it has started the construction of a hydropower plant project in
Cambodia. The plant, considered as the largest economy and technology cooperation
project between the two countries, will help Datang to tap the fledging electricity industry in
Cambodia where exists abundant but remote-located water sources. The construction of
the 120,000-kilowatt plant will have two phases. The first generator is expected to start
operation in December 2010.
China Knowledge
Insurance & Finance
June 03: China is studying plans to add more financial information to a nationwide credit
database so that individuals will have an "economic identity." Authorities are working on
including brokers and insurers' clients data into the nationwide individual credit database.
The nationwide database includes records such as payments of bank loans,
telecommunications bills, public housing fund and pension fund. Individuals with a bad
record may find it difficult to get loans.
China Daily
June 03: Shanxi Taigang Stainless Steel Company Limited said that it would jointly invest
about $1.27 billion with its parent company Taiyuan Iron & Steel (Group) Company Limited
to develop a large iron mine located in Shanxi Province. Taiyuan Iron & Steel would hold
about 65 percent stakes in the venture, while Taigang Stainless would hold the remaining
stakes. The iron mine will provide more than 2.6 million tons of iron ore concentrate to
Taigang each year.
China Knowledge
June 03: CITIC Securities Company, China's largest listed brokerage by market value,
said that it has received approval from the China Securities Regulatory Commission to
serve as an introducing broker for futures trading. The company will delegate floor
operations, trade execution and accounting to another futures merchant. The securities
firm said earlier it will invest an extra $7.2 million in its wholly-owned unit CITIC Futures
Company to raise the unit's registered capital to $21.6 million, in a bid to boost income
from commission fees of futures transactions.
China Knowledge
June 03: CITIC Resources Holdings Limited, a Hong Kong-listed unit of the nation's
largest investment enterprise, said that it is planning to raise $323 million by issuing
788.68 million rights shares to replenish working capital and help fund future investments.
Existing shareholders are entitled to buy three rights shares for every 20 shares. The
company estimates to fetch a net gain of $323 million from the deal.
China Knowledge
June 03: Tencent, Incorporation, China's largest and most used Internet service portal,
signed an official cooperation agreement with Chengdu Municipal Government to invest
$79 million in Chengdu after May 12 2008 earthquake. Under the agreement, Tencent will
invest a total of $79 million in the construction plan of Chengdu Tencent R & D Center,
Information Processing Center, and Customer Service Center, which will be located at the
Phase 2 of Tianfu Software Park in Chengdu New High-tech Industrial Development Zone.
China Knowledge
June 03: Qingdao Haier Company Limited said in a filing with the Shanghai Stock
Exchange that it is in talks with Deutsche Bank on the acquisition of the German lender's
20.1 percent stake in Hong Kong-listed Haier Electronics Group Company Limited. It is
estimated Qingdao Haier may have to spend more than $89 million for the stake, which
Deutsche Bank acquired in 2005 for $71.5 million.
China Knowledge
June 03: Shanghai Dingli Technology Development (Group) Company Limited will sell its
30 percent stake in Jiangxi Jiuhua Pharmaceutical Company Limited for $2.9 million, to
further peel off its marginal businesses. Dingli will sell the stake to a private investor. The
net value of the stock has reached $2.24 million by the end of 2007.
China Knowledge
June 03: China Merchants Bank Company agreed to buy a 53.12 percent stake in midsize
Hong Kong lender Wing Lung Bank Limited in a deal valued at $2.47 billion. China
Merchants, China's fifth-largest bank by assets, said it will buy the stake for $20 a share.
The Shenzhen-based bank said it plans to make a general offer for all the issued shares of
Wing Lung, making it a wholly owned unit, valuing the entire company at about $4.7 billion.
The Wall Street Journal; The New York Times
June 02: Daqin Railway Company Limited, China's first railway company listed in the
domestic stock market, plans to issue as much as $2.2 billion worth of 7-10 year corporate
bonds, according to the company's statement. The proceeds will be used to help fund the
purchase of rolling stock.
China Knowledge
June 02: Sichuan-based Wisesoft Company Limited, China' good-sized software and
equipment provider specializing in air traffic control, plans to issue as many as 13 million
A-shares through its planned initial public offering (IPO) in Shenzhen.
China Knowledge
June 02: China's central bank said it sold $5.3 billion worth of bills and repurchase
agreements in its regular open-market operation. The People's Bank of China sold 4.9
billion worth of one-year bills at 4.06 percent, unchanged from the rate on the one-year
bills it has sold in January-Aril period. It also sold $433 million worth of 28-day repos at
3.20 percent, unchanged from the rate on the 28-day repos it sold.
The Wall Street Journal
June 02: The China Securities Regulatory Commission said it approved Air China
Limited's plan to sell up to 400 million additional Yuan-denominated A shares. The carrier
said in November 2008 it plans to use the proceeds from the share sale to buy 54 planes
and supplement its working capital.
The Wall Street Journal
Cross - Straits
June 02: Taiwan's new foreign minister said the island would work to strengthen ties with
its allies rather than try to lure countries away from China, signaling a major shift in
diplomatic strategy. "Taiwan will no longer push to increase the number of countries that
establish full diplomatic ties with us," Francisco Ou, who took office in May 2008 along with
new President Ma Ying-jeou. "We will try our best to enhance the existing ties with our
friends and maintain friendships."
The Wall Street Journal
General News
June 03: Air France-KLM and China Southern announced the signing of a Framework
Agreement for the development of a Sino-European Cargo joint venture between both
companies. The agreement was signed on June 02 2008 in Istanbul on behalf of China
Southern by Liu Shao Yong, Chairman of the Board of China Southern Airlines Company
Limited and Leo van Wijk, Deputy Chairman of the Air France-KLM Group.
The Wall Street Journal; China Knowledge
June 03: China revealed details of the restructuring of its state-controlled
telecommunications industry, with wireless carrier China Unicom Limited saying it will
acquire fixed-line operator China Netcom Group Corporation (Hong Kong) Limited in a
share swap valued at about $24 billion. In a separate deal, Unicom and its parent
company will sell the smaller of their two wireless networks, along with the related
operations, to fixed-line operator China Telecom Limited and its parent company for a total
of nearly $16 billion in cash.
The Wall Street Journal; Washington Post; The New York Times; Houston Chronicle
June 03: China Unicom Limited said South Korea's SK Telecom Company will hold a 3.7
percent stake in the new company formed from the merger with China Netcom Group
Corporation (Hong Kong) Limited. SK Telecom now holds a 6.6 percent stake in China
Unicom. China Netcom also said that Spain's Telefonica SA (TEF) would hold a 2 percent
stake in the merged entity. The Spanish company now holds a 5 percent stake in China
Netcom.
The Wall Street Journal
June 02: China National Petroleum Corporation (CNPC), the country's largest crude
producer by output, said it would retain its halt on diesel exports and increase imports to
ensure domestic supply. The parent of PetroChina Company plans to import more than
2.4 million metric tons of diesel in 2008, CNPC has suspended diesel exports since
September 2007.
The Wall Street Journal
June 02: Global economic slowdown, financial market turmoil, growing trade friction and
continuing price increases of production goods will challenge China's ability to maintain
steady, sustainable growth. China needs to create more real competition and allow entry
opportunities for private domestic and international players.
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