Archive for ‘China alert’

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15/06/2012

* Deutsche Bank Makes Cross-Border Yuan Payment Under New China Central Bank Scheme

WSJ: “A pilot scheme intended to make it easier for companies to settle trade in the Chinese yuan officially kicked off Friday, with Deutsche Bank AG completing the first cross-border yuan payment transaction under the program.

The new program, launched by the Shanghai branch of the People’s Bank of China on a trial basis, aims to streamline the process for settling cross-border trade in the yuan by exempting qualified companies from submitting original trade documentation to support each payment. Information on the program has recently been circulated among banks in Shanghai, bankers said, though the central bank hasn’t yet made a public announcement on the initiative.

Deutsche Bank, one of the largest providers of liquidity to currency markets, executed the transaction on behalf of the China subsidiary of Huettenes-Albertus, a German manufacturer of foundry chemical products, under which the company paid a foreign supplier in yuan.

“In the past, settling trade in yuan has been both time-consuming and labor intensive,” said Beng-Hong Lee, Deutsche Bank’s head of foreign-exchange trading in China. “This is a big leap forward.”

The new scheme currently is limited to companies and banks operating in Shanghai. It follows the PBOC’s move in March, when the central bank expanded the use of yuan in trade settlement to exporters and importers across the country.

As China pushes ahead with its drive to spread global use of its currency, many analysts expect the yuan to account for a bigger share of international trade settlement. Beijing started to allow cross-border trade to be invoiced and paid for in its currency about three years ago, and since then, yuan-settled trade has grown to about 10% of China’s total trade. Some analysts have predicted that figure to grow to 3.7 trillion yuan ($587 billion) this year, or 15% of China’s total trade.”

via Deutsche Bank Makes Cross-Border Yuan Payment Under New China Central Bank Scheme – WSJ.com.

Another step in freeing the world economy from US $ domination.

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15/06/2012

* Arrested spy compromised China’s U.S. espionage network

Reuters: “A Chinese state-security official arrested this year on allegations of spying for Washington is suspected to have compromised some of China’s U.S. agents in a major setback that angered President Hu Jintao, sources said.

Hu personally intervened this year, ordering an investigation into the case after the Ministry of State Security arrested one of its own officials for passing information to the Americans, two sources with direct knowledge of the matter said.

The official, an aide to a vice minister, was taken into custody sometime between January and March after the ministry became alarmed last year over repeated incidents of Chinese agents being compromised in the United States, they said.

Seal of the C.I.A. - Central Intelligence Agen...

Seal of the C.I.A. of the United States Gov’t (Photo credit: Wikipedia)

The ministry’s own investigations found the aide had been working for the Central Intelligence Agency (CIA) for years, divulging information about China’s overseas spy network in the nation’s worst espionage scandal for two decades, they added.

The sources’ comments represent the first confirmation that overseas Chinese espionage was deemed to have been damaged by the security breach, which has been kept quiet by both Beijing and Washington. Reuters first reported it on June 1.”

via Exclusive: Arrested spy compromised China’s U.S. espionage network: sources | Reuters.

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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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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.

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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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09/06/2012

* China Signals Interest in Afghanistan

NY Times: “In a sign of China’s growing interest in neighboring Afghanistan after the departure of the United States and NATO led forces, President Hu Jintao met the Afghan leader, Hamid Karzai, in the Great Hall of the People on Friday and announced a new strategic partnership between the two countries.

Mr. Karzai was given special attention this week at the summit meeting of the Shanghai

English: Afghan President Hamid Karzai at a su...

Cooperation Organization, a group of six countries organized by China that includes Russia and Central Asian nations bordering Afghanistan. China is trying to ensure that a Muslim separatist group in a western region does not benefit from the Taliban when Western forces leave Afghanistan.

In a joint statement, China and Afghanistan said they would step up cooperation in security and the fight against terrorism, as well as increase intelligence sharing. No specifics were given.

A modest $23 million aid grant for unspecified projects that accompanied the new partnership indicated that despite concerns about the stability of Afghanistan after 2014, when most United States and allied troops are expected to be gone, China had no immediate plans to play a major development role.

This was Mr. Karzai’s fifth, and most prominent, visit to China. No Chinese leader has been to Afghanistan since the 1958 visit of Prime Minister Zhou Enlai. China’s major worry is the prospect of a Taliban-dominated Afghanistan lending sanctuary to the separatist group, the East Turkestan Islamic Movement, led by ethnic Uighurs, a Turkic-speaking, largely Muslim people in the autonomous western region of Xinjiang. The group wants a breakaway homeland in Xinjiang.

via China Signals Interest in Afghanistan – NYTimes.com.

See also: 

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