Archive for ‘USA’


China buys US soybeans for first time since trade war

Soybeans coming thru siloImage copyrightREUTERS
Image captionChina’s purchase of 1.13 million tonnes of US soybeans has been hailed as a wonderful, great step by US officials.

China has bought US soybeans for the first time since the trade war between the two countries started in July – a move hailed as a “great step” by US officials.

One of the biggest casualties of the US-China trade war has been the US soybean sector.

China is by far the world’s biggest importer of soybeans.

And Beijing’s high tariffs placed on US soybeans this year has been severely hurting US farmers.

A trade truce between China and the US was reached earlier this month however, and there had been much anticipation that China would soon return to the US soybean market.

But while China’s purchase of 1.13 million tonnes of US soybeans on Thursday was met with much applause from some, others said the purchase was too small, and not a sign that the trade war was cooling.

“Having a million, million-and-a-half tonnes is great, it’s wonderful, it’s a great step,” said Steve Censky deputy secretary of the US Department of Agriculture.

“But there needs to be a lot more as well, especially if you consider it in a normal, typical year, we’ll be selling 30 to 35 million metric tonnes to China.”

The sale also failed to excite traders, who said the numbers fell short of estimates, which saw a sell-off in soybean futures.

“It’s a start, but it’s not nearly enough to fix our problems in regards to soybeans and a soybean oversupply in this country,” said Joe Vaclavik, president of Standard Grain, a Tennessee-based brokerage.

Why do soybeans matter?

In 2017, soybeans were the single biggest US agricultural export to China, which accounts for some 60% of the global trade in the commodity.

And soybeans are vitally important to China because they use the product to feed livestock.

The key supplier globally is Brazil, but China has also relied heavily on the US for soybeans supplies – in part due to seasonality.

Bar chart for major soybean exporters

Chief economist Robert Carnell from ING Bank told the BBC that China’s purchase on Thursday was more about convenience than anything else.

“The simple fact is China needs a lot of soybeans and it’s been buying them from Brazil, not the US,” he said.

“But Brazil could never supply all the soybeans China needed, so ultimately [China has] been driven back to US soybeans. And I think it’s just convenient for them to do that right now.”

Mr Carnell said that the recent arrest of Meng Wanzhou, Huawei’s chief financial officer and deputy chair, was far more indicative of where the trade war between the US and China was really up to.

“[It’s] a battle for technology, a battle for 5G,” he said. “In particular, Huawei has become one of the world’s biggest suppliers of telecoms technology – and the US doesn’t really like that.

“[So that arrest] is giving you a much better, a much clearer message on where the trade war lines in the sand are really being drawn.”


Lowest retail sales growth for 15 years dash China’s hopes that consumption will offset trade war

Beijing had high hopes that tax cuts for individuals would lift consumer spending and boost an economy which is showing the effects of the trade war, but overall retail sales in November proved disappointing.

Even record spend on Singles’ Day’ on November 11 could not prevent retail sales from posting their weakest growth rate in 15 years.

November’s retail sales, which covers both corporate and consumer spending, stood at 3.52 trillion yuan, down from 3.55 trillion yuan in October, according to data released by the National Bureau of Statistics on Friday.

The growth rate fell to 8.1 per cent compared to November 2017, below the 8.6 per cent rate in October. The figure was also below the 8.8 per cent growth forecast by a Bloomberg poll of economists. Adjusted for inflation, the growth was even lower, at 5.8 per cent.

As the US-China trade war continues to weigh on exports, Beijing is counting on households and companies to spend more to stabilise growth.

However, weak consumption underscores the difficulties the Chinese leadership is having in its efforts to keep the economy stable.

The government expected that its October move to raising the threshold for taxable personal income to 5,000 yuan per month would release unlock spending power equivalent to hundreds of billions of yuan.

It appears likely that some consumers saved their extra income for the November 11 shopping festival, when they can benefit from large discounts.

Shen Li, a physical therapist from Beijing, said his monthly after-tax income increased by 1,000 yuan due to the tax cut, which he used to purchase items such as household appliances on Singles’ Day.

Singles’ Day, China’s version of the US’ Black Friday, is often seen as a gauge of Chinese consumers’ spending power, but in the past it has not been able to drive up total retail sales figures.

This year’s Singles’ Day sales across Alibaba’s e-commerce platforms totalled US$30.8 billion, dwarfing the online sale numbers for Black Friday and Cyber Monday combined. But the growth rate of total transactions fell to 27 per cent, from last year’s 39 per cent.

The late October launch of Apple’s new iPhone XR, which is cheaper than the earlier iPhone XS series, did not boost telecom sales in China, which dropped 5.9 per cent in November year on year, to 48.5 billion yuan.

However, a plunge in car sales was the main culprit for weak consumption. Auto sales were down 10 per cent on a year earlier, to 345.9 billion yuan, according to the statistics bureau figures, as auto dealers struggled to clear their inventories.

This matched industry surveys from the China Passenger Car Association (CPCA), which reported this week that retail sales of sedans, multi-purpose vehicles and sport utility vehicles plunged 18 per cent to 2.05 million units last month, which makes a full-year decline very likely in the world’s largest auto markets.

Ding Shuang, chief China economist from Standard Chartered Bank, said weak auto sales were caused by the expiration of tax rebates for smaller cars, a slowdown in consumer loans partly due to the crackdown in online peer-to-peer lending platforms, and subdued property investment, since new homes are often sold together with garages.

Local commentators worried about ‘downgrading’ of consumption in 2018 as spending on premium goods slowed.

The growth of real estate investment from January to November remained stable at the 9.7 per cent rate seen in the January to October period.

“The decline of consumers’ abilities and willingness to spend is going to first cut down on big ticket items like cars,” said Jiang Chao, chief economist from Haitong Securities. “Auto accounts for two-thirds of China’s consumption of consumer durables.”

Rising household debt has given Chinese policymakers few options to boost spending other than cutting taxes. China’s household debt-to-GDP rose to 49.3 per cent in the first quarter, which was lower than in advanced economies but higher than the average 40 per cent among emerging economies, according to the Bank of International Settlements.

“Household debt will continue to rise and so debt service costs will remain a drag on consumption. But the debt service burden on households should not get much worse unless there is a big acceleration in credit growth (which we do not expect),” Ernan Cui, an analyst from research firm Gavekal Dragonomics, wrote in a report.

“Local commentators worried about ‘downgrading’ of consumption in 2018 as spending on premium goods slowed,” Cui said. “The biggest boom in products favoured by affluent households is probably over, but consumption upgrading will continue as long as income growth does.”

NBS spokesman Mao Shengyong said at a press conference on Friday that China still had the potential to maintain a stable and fast rate of consumption growth next year, given the rise in the number of middle class citizens.

Economists are eyeing new individual tax deductions that will go into effect next year and more tax relief for private companies to prevent the economy from slowing further.

A more complex tax deduction policy which takes in six types of expenses – from elderly care to medical costs- could inject an additional 80 billion yuan in consumers spend, according to Cui’s estimate.

Beijing has also indicated that it will tighten the collection of social insurance contributions that employers are required to pay, but analysts fear that this could negate the benefits of the tax deductions for employees.


Sino-US trade talks advance amid close contact: Ministry of Commerce

BEIJING, Dec. 13 (Xinhua) — China and the United States are advancing their trade talks with close communication on details, the Ministry of Commerce (MOC) said Thursday.

“The Chinese side welcomes the U.S. team to visit China for consultation and is open to visiting the U.S. for communication,” MOC spokesperson Gao Feng told a news conference.

Gao said the two countries had reached consensus on specific issues including agricultural products, energy and automobiles. “Soybean has always been an important kind of agricultural import from the U.S. given the huge demand in China.”

Gao said more details of the trade talks would be released.

Chinese Vice Premier Liu He, who currently heads the China-U.S. trade talks, spoke with U.S. officials on Tuesday, and the two sides exchanged views on implementing the consensus reached by the heads of state of the two countries and on the timetable and roadmap to push forward the trade talks.


China to ‘cut US car tariff to 15%’

This file picture taken on November 9, 2017, shows US President Donald Trump (L) and China"s President Xi Jinping leaving a business leaders event at the Great Hall of the People in BeijingImage copyrightAFP/GETTY
Image captionUS President Donald Trump says he has a good relationship with President Xi Jinping

China has reportedly proposed cutting tariffs on US-made cars to 15%, the same tax levied on car imports from other countries.

Bloomberg reported that China’s cabinet will review the plans, which would undo the 40% import duty China imposed on US cars this summer.

The proposal, the timing of which remains uncertain, comes as the two countries restart trade talks.

President Donald Trump said earlier this month China would cut the tariffs.

However the claim has not yet been confirmed by Chinese officials, sowing confusion.

Tuesday’s reports in US media, which were based on anonymous sources including a car industry executive, said China outlined the plan on a recent telephone call between top trade negotiators from the two countries.

Bloomberg, which cited “people familiar with the matter”, said the step was not finalised and could still change.

The office of the US Trade Representative, which is leading the discussions, did not respond to a BBC request for comment.

In a tweet, Mr Trump said the two sides were having “very productive conversations”.

China’s commerce ministry confirmed that the two sides had spoken. In a statement it said the conversation concerned “pushing forward the timetable and road map for the next stage of economic and trade consultations work.”

Shares in car companies, including BMW, rose on the reports.

Image captionTesla, a US electric car-maker, has said its sales have been hurt by Chinese tariffs

Argentina meeting

The back-and-forth is the latest in a trade tow triggered by US claims that China engages in “unfair” trade practices, such as theft of intellectual property.

The dispute has prompted the US and China to impose new tariffs on billions of dollars worth of annual trade this year, measures that have contributed to economic worries in both countries.

The two sides, led by Mr Trump and President Xi Jinping, recently met in Argentina, where they agreed to a 90-day halt to any new tariffs.

Image captionMr Trump (front right) met Mr Xi (front left) after the G20 summit in Buenos Aires

US officials later said they wanted to see China move to reduce the car tariffs “immediately” as a sign that negotiations would proceed in good faith.

Analysts remain sceptical that the two sides will be able to reach a resolution of the underlying issues by 1 March.

Those doubts increased after the recent arrest of a high-ranking Huawei official in Canada at the request of the US, which worsened relations between the two countries.

Deja vu?

White House officials have maintained that the two matters are separate, but apparent agreements have faltered before.

In May, after talks in Washington, the US agreed to hold off on tariff threats, while China said it would reduce the import duty on foreign cars from 25% to 15%.

However that deal fell apart within weeks, after Mr Trump decided to move ahead with tariffs.

In retaliation, China raised the duty on US car imports to 40%, though it proceeded with the lower rate on imports from other countries.


Can South China Sea conflict between Washington and Beijing be avoided?

This story is part of an ongoing series on US-China relations produced jointly by theSouth China Morning Post and POLITICO, with reporting from Asia and the United States.

Rising tensions over Beijing’s accelerating military build-up in the South China Sea are stoking fears of a major-power clash between China and the United States – fuelling urgent calls for new security talks before the two nations stumble into a shooting war.

But the worries come amid a dearth of official dialogue between two of the world’s largest militaries, and as US leaders espouse an increasingly harder line against China’s actions.

The US and its allies have stepped up naval and air patrols over the sea and cancelled joint exercises with Beijing, while China is considering requiring all aircraft flying over the area to first identify themselves – a step that many nations would consider threatening.

Military experts say the showdown could easily spin out of control.

“Chinese colleagues have said to me explicitly that if the US continues to sail through and overfly what they see as their waters, China will eventually shoot down the offending aircraft,” said Matthew Kroenig, a former CIA analyst and Pentagon strategist.

“Maybe that’s just a bluff, but if China shot down a US plane, that would be a scenario ripe for escalation. It’s hard to see President Trump or any other US leader backing down from that.”

US military leaders insist they’re determined to avoid that. Navy Admiral Phil Davidson, the US commander of the Indo-Pacific Command, told POLITICO he’s eager to open a new dialogue with his Chinese counterparts, contending that “a military-to-military relationship is quite important.”

“I have yet to meet the [chief of defence] or the minister of defence in China,” he said. “I hope to visit early next year.”

Marine General Joseph Dunford, the chairman of the US Joint Chiefs of Staff, says establishing more channels for the militaries to avoid conflict is one of his top priorities as Washington and Beijing also tussle over issues such as trade and North Korea’s nuclear program. “Competition does not necessarily lead to conflict,” he said at a recent security forum in Canada.

On the other hand, the US is trying to send Chinese leaders a pointed message by sending an increased number of military patrols through the disputed waters, Dunford said in an interview with POLITICO.

“What we are doing is preserving the principle of open access to the global commons,” Dunford said. And he said nations “violating international norms, standards and the law” should know they are “going to pay a cost that is higher than whatever they hope to gain.”

Similarly, Beijing’s leaders are not backing down from their military expansion in the vast South China Sea, which stretches more than 1.3 million square miles with trillions of dollars worth of trade transiting annually. Those waters near the Spratly Islands chain where China seized reefs and began building artificial islands during the second term of the Obama administration.

Despite public assurances from President Xi Jinping that the features would not be militarised, China recently deployed surface-to-air missiles and other weapons and equipment. Earlier this year, satellite images showed that Beijing has built at least four airstrips suitable for military aircraft on Woody Island, as well as the reefs in the archipelago known as Fiery Cross, Mischief and Subi.

China has telegraphed steps to further solidify its claims in the waters. In June, Chinese Lieutenant General He Lei acknowledged during the Shangri-La defence summit in Singapore that China is deploying troops and weapons on both natural and man-made islands in the Paracel and Spratly archipelagos.

Chinese military sources from a state-owned firm specialising in radar systems to detect stealth aircraft for the PLA said the People’s Liberation Army’s Air Force and Strategic Support Force have also placed sophisticated radar systems in the South China Sea.

“Since the US has kept sending spy aircraft to do the close-in reconnaissance activities near China’s territory waters in the South China Sea, it’s necessary to deploy a sophisticated radar system to the artificial islands to detect the US aircraft,” one of the sources from the firm said.

Lieutenant General He Lei, who led the Chinese military delegation to the Shanghai-La Dialogue, said that “deploying troops and weapons on islands in the South China Sea is within China’s sovereign right to do and allowed by international law.”

The US and other countries have condemned the expansion as a violation of international law. And, in recent months, top American military officials have dropped some of their usual diplomatic language.

US Defence Secretary James Mattis revoked China’s invitation to participate in an annual military exercise this fall, then cancelled a trip to Beijing planned for October.

“If you’d asked me two months ago, I’d have said we are still attempting to maintain a cooperative stance,” the retired four-star general said at the Shangri-La summit. “But then you look at what President Xi said in the Rose Garden of the White House in 2015, that they would not militarise the Spratlys, and then we watched what happened four weeks ago, it was time to say there’s a consequence to this.”

During his trip to Vietnam in October, Mattis said Washington was highly concerned about China’s “predatory” behaviour and militarisation of the South China Sea.

“We remain highly concerned with the continued militarisation of features in the South China Sea,” he said, saying that this continued to happen despite a pledge by President Xi Jinping not to do so.

Davidson, the top American commander in the Asia-Pacific, expressed alarm recently at China’s “secretly deployed anti-ship missiles, electronic jammers and surface-to-air missiles.”

“So what was a great wall of sand just three years ago,” Davidson added, “is now a great wall of SAMs in the South China Sea, giving [the People’s Republic of China] the potential to exert national control over international waters in the South China Sea.”

The US and its allies have also launched “freedom of navigation” operations in the region. In September, two pairs of US Air Force B-52 bombers flew over the disputed area – one pair over the South China Sea and one over the East China Sea. A week later, the destroyer USS Decatur came within 12 nautical miles of two of the disputed reefs, prompting manoeuvres by a Chinese destroyer that the Pentagon called “unsafe” and “unprofessional.”

Australia, Japan, France, Canada and New Zealand are among the allies taking part in the patrols.

But the growing prominence of those other military forces has caused China to “push back more, and that heightens the risk that you could have an inadvertent crisis,” said Lindsey Ford of the Asia Society, who is also a former senior adviser to the US assistant secretary of Defence for Asian and Pacific security affairs.

China’s interest is not simply to exert political or economic influence in the region, said Kroenig, the former CIA analyst. Its activities are also defensive in nature, he believes.

China, like the Soviet Union during the cold war, is not confident that its nuclear ballistic missile submarines could survive in the open ocean during a conflict with the United States, he said – because waters closer to Chinese territory are too shallow. So it hopes to use the South China Sea as an operating area for its subs.

“That’s a strategic military purpose on top of the political purpose,” said Kroenig. “I’ve had a Chinese colleague say to me: ‘You guys don’t really care about these territorial claims in the South China Sea. You’re trying to deny our nuclear deterrent.’”

Now, Chinese military experts say, Beijing is considering establishing an “air defence identification zone”, which would require all aircraft over the area to declare their identity and destination.

The rationale is ostensibly peaceful in nature: Chinese officials maintain it would help prevent disasters such as the 2014 disappearance of Malaysia Airlines flight MH370.

But a zone Beijing established in the East China Sea in 2013 drew a joint rebuke from Japan and the Association of Southeast Asian Nations, which considered it threatening.

The resistance from other nations “implied that such a move constituted a security challenge”, said Collin Koh Swee Lean, an analyst at the S. Rajaratnam School of International Studies in Singapore.

Koh warned that the air traffic proposal could derail regional talks about establishing a code of conduct to avoid confrontations in the area. He also predicted that the US might feel compelled to ramp up its military presence in response – a view echoed by Zhou Chenming, a military expert based in Beijing.

Further fuelling tensions in the South China Sea is the growing role of China’s so-called Maritime Militia, a naval paramilitary force that operates disguised as fishing or other civilian vessels. Vice-President Mike Pence recently criticised the forces as extra-legal, and the rules for approaching them are ill-defined.

“Should we treat them as military vessels and expect them to behave that way?” asked the Asia Society’s Ford. “China is exploiting a loophole. Pence’s recent remarks calling out the Maritime Militia explicitly suggest the US is refining its thinking about how to approach that loophole.”

For now, senior American military leaders are expressing confidence that US forces can continue to aggressively promote their freedom of navigation mission without sparking a violent confrontation.

“I think one of the unfortunate things is the focus on two destroyers passing in the daylight,” Davidson told POLITICO. “That is not what the issue is about in the South China Sea. It is about trade, commerce, financial markets moving their information around the globe – every airline that flies over the top.”

Others worry that the longer the United States and China up the ante the more likely things could spin out of control.


China’s hacking against U.S. on the rise – U.S. intelligence official

NEW YORK (Reuters) – A senior U.S. intelligence official said on Tuesday that Chinese cyber activity in the United States had risen in recent months, targeting critical infrastructure in what may be attempts to lay the groundwork for future disruptive attacks.

“You worry they are prepositioning against critical infrastructure and trying to be able to do the types of disruptive operations that would be the most concern,” National Security Agency official Rob Joyce said at a Wall Street Journal cybersecurity conference.

Joyce, a former White House cyber adviser for President Donald Trump, did not elaborate. A spokeswoman for the NSA said Joyce was referring to digital attacks against the U.S. energy, financial, transportation and healthcare sectors.

The comments are notable because U.S. complaints about Chinese hacking have to date focussed on espionage and intellectual property theft, not efforts to disrupt critical infrastructure.

China has repeatedly denied U.S. allegations it conducts cyber attacks.

Joyce’s remarks coincide with U.S. prosecutors preparing to unveil as early as this week a new round of criminal hacking charges against Chinese nationals. They are expected to charge that Chinese hackers were involved in a cyber espionage operation known as “Cloudhopper” targeting technology service providers and their customers, according to people familiar with the matter.

The U.S. Congress is looking into the allegations of increased Chinese hacking activity.

Senior officials from the Department of Homeland Security and Justice Department are scheduled to testify Wednesday morning at a Senate Judiciary Committee hearing on “China’s Non-Traditional Espionage Against the United States: The Threat and Potential Policy Responses.”


China’s Tencent Music raises nearly $1.1 billion in U.S. IPO

NEW YORK/HONG KONG (Reuters) – China-based music streaming company Tencent Music Entertainment Group (TME.N) said it raised close to $1.1 billion in its U.S. initial public offering (IPO) after pricing its shares at the bottom of its targeted range.

The music arm of gaming and social network giant Tencent Holdings Ltd (0700.HK) priced its American Depositary Receipts (ADRs) at $13 per share, at the low end of its indicated $13 to $15 per share range, it said in a filing with the Hong Kong stock exchange.

The IPO values Tencent Music at $21.3 billion and shows how companies are defying a bout of market volatility with flotations.

Tencent Music sold 41 million ADRs, while existing shareholders sold a further 40.9 million, the filing said.

Tencent Music’s IPO tops off a bumper year for U.S. listings by Chinese companies, with $7.9 billion raised before Tencent Music’s debut, Refinitiv data showed.

That is the highest amount since 2014, the year of Alibaba Group Holding Ltd’s (BABA.N) record $25 billion IPO.

Tencent Music’s U.S. IPO is the fourth largest among Chinese firms this year by deal value. Video streaming company iQiyi Inc (IQ.O) leads with its $2.4 billion listing, followed by online group discounter Pinduoduo Inc (PDD.O) at $1.6 billion and electric vehicle maker NIO Inc (NIO.N) at $1.15 billion.

Returns for investors have been mixed, with the 31 Chinese IPOs in 2018 down an average of around 11 percent as of Dec. 10, according to data provider Dealogic.

With streaming apps QQ Music, KuGou, Kuwo as well as karaoke app We Sing, Tencent Music is China’s largest online music platform boasting more than 800 million active users monthly.The firm is often compared with Spotify Technology SA (SPOT.N) but offers more socially interactive services that make it profitable while its Swedish counterpart is not.

Tencent Music initially planned to launch the deal in October but postponed because of a sell-off in global markets roiled by a U.S.-China trade war and fears of slowing global growth.

Tencent Music reported a 244 percent profit jump for January-September to $394 million. By comparison, Spotify lost a net $520 million.

Morgan Stanley, Bank of America, Deutsche Bank, Goldman Sachs and JPMorgan are the lead sponsors of Tencent Music’s deal.

Tencent Music is due to begin trading on the New York Stock Exchange on Wednesday under the symbol “TME” (TME.N).


China, U.S. discuss road map for next stage of trade talks

BEIJING (Reuters) – China and the United States discussed a road map for the next stage of their trade talks on Tuesday, during a telephone call between Vice Premier Liu He and U.S. Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer.

U.S. President Donald Trump and Chinese President Xi Jinping agreed at a Dec. 1 meeting in Argentina to a truce that delayed the planned Jan. 1 U.S. increase of tariffs to 25 percent from 10 percent on $200 billion (157 billion pounds) worth of Chinese goods.

Lighthizer said on Sunday that unless U.S.-China trade talks wrapped up successfully by March 1, new tariffs would be imposed, clarifying there was a “hard deadline” after a week of seeming confusion among Trump and his advisers.

China’s commerce ministry said in a statement Liu had spoken to Mnuchin and Lighthizer on Tuesday morning, Beijing time, on a pre-arranged telephone call.

“Both sides exchanged views on putting into effect the consensus reached by the two countries’ leaders at their meeting, and pushing forward the timetable and roadmap for the next stage of economic and trade consultations work,” the ministry said.

It did not elaborate.

A U.S. Treasury spokesman confirmed that the call with Liu took place, but offered no further details. The U.S. Trade Representative’s office did not immediately respond to a query about the call.

The Wall Street Journal, citing people familiar with the issue, said Liu planned to go to Washington after the new year.

The Harvard-education Liu, Xi’s top economic adviser, is leading the talks on the Chinese side.

In comments reported separately by China’s Foreign Ministry, the government’s top diplomat, State Councillor Wang Yi, said if China and the United States cooperated, it would benefit the whole world.

“If China and the United States are antagonistic, then there are no winners, and it will hurt the whole world,” Wang told a forum.

The United States should look at China’s development in a more positive light, and constantly look to “expand the space and prospects for mutual benefit”, he said.

Global markets are jittery about a growing clash between the world’s two largest economic powers over China’s huge trade surplus with the United States and Washington’s claims that Beijing is stealing intellectual property and technology.

The arrest of a top executive at China’s Huawei Technologies Co Ltd [HWT.UL] has also roiled global markets amid fears that it could further inflame the China-U.S. trade row.


Deflation threat returns to haunt Chinese economy as risks from US trade war linger

  • Both consumer price index and producer price index fell on a monthly basis due to weak demand and a steep drop in oil prices
  • Bad news follows slower than expected drop in imports and exports
  • China suffered another economic blow on Sunday with the return of the deflation threat, a day after it reported slower than expected growth in exports and imports.

    A fall in both consumer and producer price indexes was a result of weakness in demand from both Chinese consumers and investors and reflected their reluctance to spend as confidence in future growth is undermined by the trade war with the US.

    The figures add the challenge faced by the Chinese leadership in keeping economic growth on track ahead of the annual central economic work conference, where policies for next year will be determined.

    Last month the consumer price index fell 0.3 per cent from October while the producer price index dropped 0.2 per cent – the first month-on-month fall in seven months – due to the steep fall in the price of crude oil and coal, according to data released by the National Bureau of Statistics on Sunday.

    On a yearly basis, China’s PPI rose only 2.7 per cent in November, the lowest reading in two years, while China’s CPI in November rose 2.2 per cent from a year earlier, the lowest in four months, the official statistics showed.

    Analysts said deflationary pressure was set to continue as economic activities to weaken.

    Jiang Chao, an analyst with Haitong Securities, wrote in a note before the Sunday data was released that China’s PPI would drop to zero in December and fall further into negative territory in 2019, officially putting China in a deflationary zone.

    The return of deflation risks, which often associated with a contraction in economic activities, provides fresh evidence that China’s US$12 trillion economy is heading into trouble, even though China and US have agreed a 90-day truce in the trade war during which they will try to resolve their differences.

    The official purchasing managers index, a leading indicator of economic growth, showed activity in China’s vast manufacturing sector stalled in November for the first time in over two years as new orders shrank.

    The country’s exports decelerated rapidly last month, although China’s trade surplus with the US widened to a record level, the Chinese customs administration said on Saturday.

    The Chinese government has been trying to shore up confidence in the country’s economic prospects since the summer and shifted its policy priority from cutting debt to bolstering growth.

    However, signs of stress continue to mushroom in the economy.

    Economic data from the first three quarters of the year has suggested that as many as 19 provinces have fallen behind their annual GDP targets and many local governments are scrambling to spur investment so that they can meet their growth targets for 2018.

    The Chinese government has expressed its concerns about unemployment and promised to give cash subsidies – in the form of a partial refund of unemployment insurance payments – to employers if they do not cut their labour force.

    China’s economic growth also slowed to 6.5 per cent in the third quarter of this year from 6.7 per cent in the second quarter of this year


China-U.S. dialogue on rule of law and human rights concludes in Beijing

BEIJING, Dec. 6 (Xinhua) — The eighth China-U.S. Dialogue on Rule of Law and Human Rights concluded in Beijing Wednesday.

Jiang Jianguo, deputy head of the Publicity Department of the Communist Party of China Central Committee, addressed the opening session of the three-day event.

Jiang expressed the hope that the dialogue between China and the United States in the field of human rights could comply with the trend and look at the big picture, respect differences and communicate equally, deepen cooperation and enhance mutual trust, in order to play a unique role in promoting the cause of human rights of the two countries and the healthy development of China-U.S. relations.

Huang Mengfu, chairman of China Foundation for Human Rights Development, said the dialogue, initiated in 2009, had become an important platform for non-governmental organizations of both countries to conduct exchanges on human rights, effectively enhancing mutual understanding.

“It reflects the good wishes of both sides to contribute to China-U.S. relations through people-to-people communication and exchanges,” Huang added.

Next year will mark the 40th anniversary of the establishment of diplomatic relations between the two countries, said Stephen A. Orlins, president of the National Committee on U.S.-China Relations.

Orlins said he hoped the dialogue would have a positive influence on relations between the two countries and called for confidence in the future of U.S.-China relations.

Over 50 experts and scholars from China and the United States attended the event. The American representatives visited the Supreme People’s Court and Beijing Internet Court on Wednesday.

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