Archive for ‘Economics’

26/03/2015

India Takes Top Spot In Producing Wealthy Households – India Real Time – WSJ

India’s affluent-household club is growing quickly.

Over the next five years, the number of such households–meaning those with financial assets of $100,000 to $2 million –is expected to jump 10-fold, to 4.9 million, according to an Economist Intelligence Unit study. In percentage terms, India ranked first among the 32 nations covered in the report.

By that same year,  the total financial assets in these households should reach $879 billion, driven by significant “economic reforms, attention to infrastructure, a stable political outlook and positive investor sentiment,” according to the report.

via Report: India Takes Top Spot In Producing Wealthy Households – India Real Time – WSJ.

26/03/2015

Ford aims to triple exports from India with $1 bln plant | Reuters

Ford Motor Co(F.N) has invested $1 billion in a new plant in western India which will help the automaker triple exports from the country, chief executive Mark Fields told reporters on Thursday.

A Ford logo is seen during preparations for the 2014 LA Auto Show in Los Angeles, California November 18, 2014. REUTERS/Lucy Nicholson/Files

Ford plans to make India an export hub for compact cars such as the EcoSport, a sub-four meter sports utility vehicle, and the newly launched compact sedan, Ford Figo Aspire, the first car to be produced at the new facility.

The new manufacturing facility in Gujarat will nearly double the company’s installed production capacity in the country to 610,000 engines and 440,000 vehicles a year, Fields said at the launch of the new facility.

via Ford aims to triple exports from India with $1 bln plant | Reuters.

26/03/2015

Britain launches Europe’s first yuan money-market fund | Reuters

Britain deepened its financial links with China on Wednesday with the launch of Europe’s first yuan-denominated money market fund, which allows investors to get direct exposure to China’s interbank lending market.

100 Yuan notes are seen in this illustration picture in Beijing November 5, 2013. REUTERS/Jason Lee

The exchange-traded fund from China Construction Bank International (601939.SS), China’s second largest bank, is listed on the London Stock Exchange and can be traded in sterling, euros and yuan, Britain’s government said.

London has been keen to attract Chinese banks and encourage offshore trade in the yuan to bolster its position as the world’s main centre for foreign exchange trading.

Last year Britain became the first Western government to issue a yuan-denominated bond. On Tuesday the finance ministry’s chief economist said he viewed the yuan’s possible inclusion in the International Monetary Fund‘s currency basket as a “very live” issue.

“The launch of this (fund) will provide further opportunities for British and other global investors to invest directly into China,” said Andrea Leadsom, a junior British finance minister.

via Britain launches Europe’s first yuan money-market fund | Reuters.

26/03/2015

Hainan Airlines to buy 30 Boeing 787-9 jets, worth $7.7 billion by list price | Reuters

Hainan Airlines Co Ltd (600221.SS), China’s fourth-largest carrier, said on Wednesday it plans to order 30 Boeing Co (BA.N) B787-9 jets as it seeks to expand international routes to tap into growing demand for overseas travel from China.

The Boeing logo is seen at their headquarters in Chicago, April 24, 2013.  REUTERS/Jim Young

The order would be the biggest this year for the jet, worth $7.7 billion (5 billion pounds) according to list prices. It would also boost the aircraft maker’s 787 programme backlog to 855 planes.

China’s airline passengers are increasingly looking beyond the mainland for travel opportunities. In 2014, Chinese travellers made more than 100 million trips overseas in a year for the first time, up sharply from 8.4 million in 1998, official data show.

Hainan Airlines added two long-haul routes to North America and Western Europe last year and plans major international expansion this year, Cai Zhiquan, a brand manager told Reuters. On Thursday. it reported net profit jumped 20 percent in 2014 to 2.59 billion yuan ($417 million).

“We’ll be flying from major hubs in China to second- or third-tier cities overseas,” said Cai. “At the same time, we’ll also open up more routes from inland Chinese cities to major hub cities elsewhere.”

via Hainan Airlines to buy 30 Boeing 787-9 jets, worth $7.7 billion by list price | Reuters.

22/03/2015

Chinese capital shuts third coal-fired plant in war on smog | Reuters

China’s smog-hit capital Beijing has shut down the third of its four coal-fired power plants as part of its campaign to cut pollution, with the final one scheduled to close next year, the official Xinhua news agency said on Friday.

A security personnel walks near Tiananmen Gate on a heavily hazy day in Beijing October 24, 2014.  REUTERS/Jason Lee

In 2013, the city promised in its clean air action plan to bring annual coal consumption down to less than 10 million tonnes by 2017, a reduction of 13 million tonnes in just four years.

It said it would shut down all four of its coal-fired power plants within four years, a move that would cut annual coal consumption by around 9 million tonnes.

Officials also plan to reduce coal combustion in heating systems and industrial facilities, partly by switching to natural gas and by relocating some factories out of the city, and to phase out coal consumption completely by 2020.

A 400-megawatt facility owned by the Guohua Electric Power Co. Ltd was shut on Friday and replaced with a gas-fired plant. It followed the closure of a 93-year-old power station run by Beijing Jingneng Power on Thursday.

It shut its first coal-fired plant, the 600-MW Gaojing facility owned by the China Datang Corporation, last July.

Average levels of hazardous airborne particles known as PM2.5 stood at 85.9 micrograms per cubic meters in 2014, down 4 percent compared with the previous year, but still far higher than the national air quality standard of 35 micrograms.

Beijing plans to bring readings down to 60 by 2017, the municipal environmental bureau said earlier this year.

Only eight of the 74 Chinese cities monitored by the Ministry of Environmental Protection met smog standards in 2014. Seven of the 10 worst-performing cities were in the province of Hebei, which surrounds Beijing.

via Chinese capital shuts third coal-fired plant in war on smog | Reuters.

21/03/2015

China’s Coming Education Crisis – China Real Time Report – WSJ

Yao Xinyu, founder of a popular software hosting service called GitCafe, opted not to attend college because he felt he could do a better job teaching himself what he needed to be successful in the real world.

His parents disapproved but he stuck to his guns, studied on his own and built the successful startup after attracting 3 million yuan in capital from Greenwood Asset Management in late 2013. The 24-year old doesn’t see much chance that colleges in China will change to better meet the shifting needs of China’s economy, he said, since demand is high, their business model is profitable and there’s little incentive to adapt.

“I just decided I knew how to develop my own career,” he added.

One the knottiest problems China faces as its economy slows is a mismatch between people’s education levels and the needs of an economy increasingly reliant on technology and innovation, the Organization of Economic Cooperation and Development said Friday in a report on China.

China’s productivity is decelerating and it’s important to reverse this “worrisome” trend given the nation’s rapidly aging population and the related prospect of slower rates of savings and investment, the Paris-based organization said.

“The knowledge taught and skills nurtured at school do not sufficiently match labor market needs,” it said. “Workplace training-based vocational education arrangements are woefully inadequate.”

While China has aggressively stepped up its spending on research, this isn’t translating sufficiently into innovation, the 34-member OECD said. China’s spending on research and development hit 2% of gross domestic product in 2013, which is above the European Union average, and has set a target of 2.5% of GDP by 2020. But innovation remains weak as measured by international patenting and trademark registration, the report said. “And the bulk of university research is not relevant for business,” the OECD said.

Many of China’s past gains in productivity were related to capital, but the country’s future focus should be on the economic benefits of better trained workers, said Angel Gurria, secretary general of the Paris-based group. “Productivity, productivity, productivity, it’s not a choice, it’s a must,” he said. “Without it, China’s not going to be able to continue growing at this cruising speed.”

China has targeted economic growth of 7% this year, a reduction from last year’s 7.4% which was its slowest pace in nearly a quarter century.

via China’s Coming Education Crisis – China Real Time Report – WSJ.

21/03/2015

ChemChina close to Pirelli deal that would trigger buyout offer | Reuters

China National Chemical Corp (ChemChina) is close to becoming the biggest single shareholder in Pirelli (PECI.MI) in a deal that would trigger a 7 billion euro ($7.5 billion) buyout of the Italian tire company.

The Pirelli logo is pictured at their headquarters in Milan March 18, 2014. REUTERS/Alessandro Garofalo

Three sources familiar with the deal, which would be the latest in a string of Chinese investments in large Italian companies, said ChemChina was discussing a deal with Pirelli’s top shareholders to buy a holding company called Camfin, which owns 26 percent of Pirelli and is 50 percent owned by Russia’s Rosneft (ROSN.MM).

Without identifying the possible buyer, Camfin said it was in talks with an international industrial group to sell its Pirelli stake at 15 euros per share, valuing the tire group at 7.1 billion euros.

It said the stake would be transferred to a vehicle controlled by the new partner, after which a takeover offer for the rest the world’s fifth-largest tire maker would ensue.

If the offer succeeds, Pirelli will be delisted. The deal comes as Pirelli’s rivals Michelin (MICP.PA) and Continental (CONG.DE) look around for growth opportunities in Asia.

State-controlled ChemChina and Rosneft declined to comment.

Previous Chinese investments in Italy include State Grid Corp of China [STGRD.UL] buying into electricity grid company Terna (TRN.MI) and gas network operator Snam (SRG.MI).

Besides Rosneft, Camfin’s owners are a holding company comprising Pirelli chief Marco Tronchetti Provera as well as Italian banks Intesa Sanpaolo (ISP.MI) and UniCredit (CRDI.MI).

via ChemChina close to Pirelli deal that would trigger buyout offer | Reuters.

14/03/2015

China’s greener energy efforts help global carbon emissions stall after almost 40 years of gains | South China Morning Post

China burned less coal and generated more electricity from renewable sources last year, which helped halt the rise in global carbon dioxide emissions in the energy sector.

China burned less coal last year and generated more electricity from renewable sources to help halt the global rise in  carbon dioxide emissions. Photo: Reuters

Emissions of carbon dioxide were flat at 32.3 billion tonnes last year, as they were in 2013, the International Energy Agency (IEA)  reported yesterday.

It ended steady gains over the past four decades except in years with an economic downturn.

“This is both a welcome surprise and a significant one,” IEA chief economist Fatih Birol said in a statement.

“This gives me even more hope that humankind will be able to work together to combat climate change, the most important threat facing us today.”

The IEA, which is based in France, and advises governments of developed nations, said the halt in emissions growth was linked to greener patterns of energy consumption in China – the top carbon emitter ahead of the United States – and in developed nations.

“In China, [last year] saw greater generation of electricity from renewable sources, such as hydropower, solar and wind, and less burning of coal,” it said.

via China’s greener energy efforts help global carbon emissions stall after almost 40 years of gains | South China Morning Post.

13/03/2015

Infrastructure: Aerotropolitan ambitions | The Economist

POLITICIANS in London who have been debating for years over whether to approve the building of a third runway at Heathrow Airport might find a visit to Zhengzhou—an inland provincial capital little known outside China—an eye-opening experience. Some 20,000 workers are labouring around the clock to build a second terminal and runway for the city’s airport. They are due to begin test operations by December, just three years after ground was broken. By 2030, officials expect, the two terminals and, by then, five runways will handle 70m passengers yearly—about the same as Heathrow now—and 5m tonnes of cargo, more than three times as much as Heathrow last year.

But the ambitions of Zhengzhou airport (pictured) are far bigger than these numbers suggest. It aspires to be the centre of an “aerotropolis”, a city nearly seven times the size of Manhattan with the airport not a noisy intrusion on its edge but built into its very heart. Its perimeter will encompass logistics facilities, R&D centres, exhibition halls and factories that will link central China to the rest of the global economy. It will include homes and amenities for 2.6m people by 2025, about half as many as live in Zhengzhou’s main urban area today. Heathrow struggles to expand because of Londoners’ qualms, but China’s urban planners are not bothered by grumbling; big building projects rarely involve much consulting of the public.

via Infrastructure: Aerotropolitan ambitions | The Economist.

13/03/2015

Bargaining With Chinese Characteristics: Labor Group Defends Practices – China Real Time Report – WSJ

When Chinese Premier Li Keqiang omitted a reference to collective bargaining in an annual policy speech last week, labor scholars worried that Beijing may be backing away from a much-needed policy tool for dealing with rising industrial unrest.

China’s state-controlled trade unions are seeking to allay such concerns. They are pledging to keep promoting collective bargaining in a way that calms labor tensions without derailing growth in the country’s already-slowing economy.

“Collective wage bargaining is something we will continue to promote,” said Li Shouzhen, a senior official at the All-China Federation of Trade Unions, or ACFTU. “It is a tried-and-tested process that’s practiced by successful enterprises.”

via Bargaining With Chinese Characteristics: Labor Group Defends Practices – China Real Time Report – WSJ.

Follow

Get every new post delivered to your Inbox.

Join 584 other followers