Archive for June, 2012

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15/06/2012

* More people see China as the world’s top economy, poll finds

LA Times: “Never mind that the U.S. economy is about twice the size of China’s. More people than ever perceive the Asian giant as the world’s dominant economic power, according to a Pew Research Center global survey.

The results are believed to reflect popular opinion that the U.S. and Chinese economies are heading in opposite directions.

“The global financial crisis and the steady rise of China have led many to declare China the world’s economic leader,” said the report, which was released Wednesday and also addressed a series of global opinions on the perception of nations and their leaders.

For the first time, respondents around the world picked China as the world’s leading economy over the U.S., by a margin of 42% to 36%.

Asked the same question last year, a median of 41% said the U.S. is the world’s leading economy and only 35% picked China.

Even many American respondents said they believed China was ahead, with 41% saying China was the leading power and 40% saying the U.S.

Chinese respondents were more sanguine (and realistic), with 48% calling the U.S. the primary economic power and 29% choosing China.

There’s ample reason to believe that China is ascendant. The country was able to insulate itself from the 2008 financial crisis with minimal exposure to foreign banks. What it lost in trade it made up for with a massive stimulus plan. China is also sitting on a cache of $3.2 trillion in foreign reserves that many believe it can wield as a financial weapon.

But China’s path to global dominance is anything but assured and, at the very least, decades off, economists say.”

via More people see China as the world’s top economy, poll finds – latimes.com.

They say: “perception is reality”!

See also: G2?

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14/06/2012

* Chinese State Council improves food safety

China Daily: “The State Council laid out measures to improve food safety on Wednesday, including tighter supervision and harsher punishment for violators.

“It is an onerous task for the government to ensure food safety,” as China’s food industry is still suffering from nonstandard management and many hidden safety risks, according to a statement released after a State Council executive meeting presided over by Premier Wen Jiabao.

Police officers examine decayed beans at an illegal food processing plant in Cangshan county, East China’s Shandong province, on June 1. The plant has been shut down. Initial investigation found its products, fried beans and peanuts, were mainly sold to rural market. [Zhu Wutao / For China Daily]

The government should enhance supervision by setting up an efficient mechanism that covers all links in the food industry and a rigid food recall system for destroying defective products, the statement said.

The State Council has vowed a “vigous crackdown” on those who endanger food safety.

Meanwhile, policies, laws and regulations should be revised to increase costs for violators, according to the statement.

The country will intensify a series of food safety supervisions, including strengthening enterprises’ accountability for their food products and streamlining current food quality testing standards .

The country will establish credit profiles for food enterprises, releasing quality information to the public in time, the statement said.

Also, the country will give prizes to people who expose substandard food products, it said.

China is facing increasing risks on food safety as some food enterprises have put too much emphasis on profits, negatively affecting sales, Pu Changcheng, deputy director of the General Administration of Quality Supervision, Inspection and Quarantine, said at a news conference on Monday.”

via State Council improves food safety |Politics |chinadaily.com.cn.

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14/06/2012

* What Happens if India Is Downgraded to ‘Junk’?

NY Times: “Since Standard & Poor’s warned Monday that India could be the first among the BRIC nations to lose its investment grade rating, politicians in India have moved quickly to discount the report.

Finance Minister Pranab Mukherjee “rejects” the report, the ministry said in a statement, which added that there are “several positives” for the Indian economy in the future. Rajkumar Dhoot, a member of Parliament and head of an industry trade group, referred to the report as “drawing room talk,” while Veerappa Moily, the minister of corporate affairs, said “S&P can not speak like this,” the Press Trust of India reported.

The criticism of Standard & Poor’s is overlooking an important point, analysts say. Whether politicians and industry leaders agree with the rating agency or not, a downgrade to so-called ‘junk’ status, could have very serious, very negative connotations.

“We shouldn’t ignore foreign rating agencies, either right or wrong,” said Vikram Limaye, deputy managing director at the Infrastructure Development Finance Company. “We should take their concerns into account. It is incumbent upon us to explain why their fears are misplaced or exaggerated in a reasonable way. Dismissal will not get us anywhere.”

A rating downgrade to junk status would mean that there would be an increase in the overseas borrowing costs for Indian companies and the country’s ability to attract foreign investment would be considerably diminished.

“This could have a major impact on overall fund flows, which rely heavily on international ratings,” said Dipen Shah, who leads fundamental research at Kotak Securities. “While the overall international debt is not so alarming as a proportion of the G.D.P., India needs a lot of capital flows to cover up its balance of payment deficit.”

While the cost of borrowing will increase, India’s borrowing capability will also be materially reduced, as certain investors who only invest in investment-grade paper will shun India.”

via What Happens if India Is Downgraded to ‘Junk’? – NYTimes.com.

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14/06/2012

* Actress Sues Publications Over Bo Allegations

NY Times: “One of China’s most famous actresses has filed a libel suit against two prominent Hong Kong news organizations over articles saying she was paid to have sex with Bo Xilai, the deposed Communist Party official.

The actress, Zhang Ziyi, sued Apple Daily, a well-known tabloid newspaper, and Next Magazine Publishing, both of which are owned by Next Media. Executives at the companies have declined to comment. Apple Daily reported this spring that Ms. Zhang made $110 million by sleeping with Mr. Bo and other officials in recent years; the article said she was introduced to Mr. Bo by Xu Ming, a tycoon who has been detained in the Bo investigation. Mr. Bo, a former Politburo member, is being investigated for abuse of power.”

via China – Actress Sues Publications Over Bo Allegations – NYTimes.com.

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14/06/2012

* India the Worst Big Country to Be a Woman

NY Times: ““India, a country best-known for its rising economic might, is the worst place to be a woman among the world’s biggest economies, and Canada the best, according to a survey of experts published Wednesday,” Katrin Bennhold wrote on The Rendezvous blog.

“The Group of 20 survey by TrustLaw, a legal news service of the Thomson Reuters Foundation, found that a combination of infanticide, child marriage and slavery left India at the bottom of the ranking, lagging even Saudi Arabia, where women are still not allowed to drive and only gained the vote in 2011,” she wrote.”

via India the Worst Big Country to Be a Woman – NYTimes.com.

See also:  Women in India

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13/06/2012

* Saab sold to Chinese-Swedish investment group

BBC News: “Bankrupt carmaker Saab has been sold to a Chinese-Swedish investment group which aims to turn the company into a maker of electric vehicles. Saab’s administrator said the buyer was National Electric Vehicle Sweden (Nevs). No sale price was given. Saab went bankrupt in December, two years after former owner General Motors sold it to Dutch group Spyker.

Saab “will start a new operation” to develop and produce electric cars, the administrator said in a statement.

The administrator said in April that Saab had assets to cover about a third of its debts of 13bn kronor (£1.2bn).

The chief executive and main owner of Nevs is a Chinese businessman with Swedish citizenship, Kai Johan Jiang. The chairman of Nevs is Karl-Erling Trogen, a former head of the truck division of truck and construction equipment maker Volvo.

“Nevs and the receivers of the Saab Automobile bankruptcy estate today signed a purchase agreement which covers the main assets of Saab Automobile AB, Saab Automobile Powertrain AB and Saab Automobile Tools AB,” Nevs and the administrators said in a joint statement.

Saab employs about 3,000 people, with its main base at Trollhattan, west Sweden, where investment in new electric car manufacturing will be made.”

via BBC News – Saab sold to Chinese-Swedish investment group.

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13/06/2012

* Gun Ring Involving U.S. Soldier Is Broken Up, Chinese Officials Say

NY Times: “The Chinese authorities said on Tuesday that they had detained 23 suspects here and had broken up an international gun trafficking ring that conspired with a United States soldier to smuggle firearms into China.

The Ministry of Public Security said that more than 100 guns and gun parts, and about 50,000 bullets, had been seized in the case, which is being jointly investigated with the American authorities. The announcement came weeks after United States officials arrested Staff Sgt. Joseph Debose, 29, a soldier with a Special Forces National Guard unit in North Carolina, on charges of illegal firearms trafficking.

According to the United States attorney’s office for the Eastern District of New York, customs officers in Shanghai stumbled upon the smuggling ring in August after discovering a Beretta 9-millimeter semi-automatic handgun and other firearms hidden inside a stereo speaker in a U.P.S. package. After contacting U.P.S. in the United States, as well as the Department of Homeland Security, the authorities traced the package to two Chinese nationals in New York, using shipping documents and surveillance video from a U.P.S. facility in Queens. The two men eventually led the authorities to Sergeant Debose, who was acting as a gun dealer in North Carolina, prosecutors said.”

via Gun Ring Involving U.S. Soldier Is Broken Up, Chinese Officials Say – NYTimes.com.

Posted in China alert, Smuggling | 1 Comment »

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13/06/2012

* China football ex-chiefs Nan Yong and Xie Yalong jailed

BBC News: “Two ex-heads of China’s football league have been jailed for 10-and-a-half years each for corruption, making them the most senior football officials sentenced. Nan Yong and his predecessor Xie Yalong were both accused of accepting bribes. Nan was also fined 200,000 yuan ($31,400; £20,200) and Xie is set to have personal assets and illegal takings confiscated.

China has increased efforts to clean up the game, hit by a series of scandals.

Nan, charged with 17 counts of taking bribes, was sentenced by a court in Tieling in north-eastern China. Xie, who was sentenced in Dandong, denies the charges against him adding that he only confessed to the allegations under torture. More than 900,000 yuan in personal assets and illegal takings of his are set to be confiscated.

Several other verdicts have also been delivered in similar cases in other cities, Chinese media reported.

In Dandong, a former national team captain was also sentenced to 10 years and six months in jail and fined 200,000 yuan. Four former national team players were sentenced in Shenyang for to up to six years’ jail and fined 500,000 yuan for taking bribes and match fixing.

via BBC News – China football ex-chiefs Nan Yong and Xie Yalong jailed.

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10/06/2012

* China Passenger-Car Sales Pick Up

WSJ: “Passenger-car sales in China accelerated in May, a positive sign for the world’s second-largest economy and the largest auto market. Strong auto sales in China, a signal consumers are still buying big-ticket items, could reassure markets concerned that the country is heading for a sharp economic slowdown.

Sales in May were up 23% from a year earlier, to 1.28 million vehicles, the semiofficial industry group China Association of Automobile Manufacturers said in a statement Saturday. That’s faster than Aprils 13% pace—which was itself an encouraging turnaround from the decline in the first quarter, when sales were down 1.3% from a year earlier.”

via China Passenger-Car Sales Pick Up – WSJ.com.

One small positive indicator amongst lots of negatives.  See: https://chindia-alert.org/2012/06/10/chinese-economy-shows-a-second-month-of-anemic-growth/

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10/06/2012

* Chinese Economy Shows a Second Month of Anemic Growth

NY Times: “The Chinese economy, widely seen until the last few weeks as the strongest remaining locomotive that could drag the global economy back from the brink of recession, showed a second month of anemic growth in May and performed even worse than the already lowered expectations of most economists.

Growth in industrial production, retail sales and investment in fixed assets like factories and office buildings was little changed from April, according to data released on Saturday afternoon in Beijing by China’s National Bureau of Statistics. Some economists had considered the April figures to be a fluke and had predicted a rebound in May, when the Chinese government began measures to rekindle growth.

April had been the weakest month in China since 2001 for growth in fixed-asset investment, and May was slightly weaker still. Before adjustment for inflation, retail sales grew even more slowly in May than in April. But retail sales were a little stronger in May after they were adjusted for inflation, which has slowed steadily this spring. Industrial production grew at a slightly faster pace in May from a year earlier, 9.6 percent, than it had in April, when growth was 9.3 percent.

And in an unexpected piece of good news released Sunday morning, China’s exports and imports both grew twice as fast last month as economists had expected. Exports rose 15.3 percent, triple the pace in April, and imports grew 12.7 percent after stalling the month before. Some economists said that if demand for China’s exports held up long enough for the Chinese government to start the many infrastructure projects approved in recent weeks, the country’s economy could avoid a more serious downturn.”

via Chinese Economy Shows a Second Month of Anemic Growth – NYTimes.com.

This overall view of the economy contrasts with the huge increase in passenger car sales.  See: https://chindia-alert.org/2012/06/10/china-passenger-car-sales-pick-up/

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