08/10/2009 Source: Xinhua

China’s home prices continued to rise in July as bank loans surged and the country’s economy improved.

Home prices in 70 large and medium-sized Chinese cities rose 1 percent in July from a year earlier, according to a joint statement issued Monday by the National Development and Reform Commission and the National Bureau of Statistics.

The prices climbed 0.9 percent from June, which saw a 0.8 percent gain over May.

Prices of new homes in the listed cities rose 0.3 percent year on year in July, and 1.1 percent from June. New home prices increased in 43 cities, including eastern Ningbo City and northwestern Yinchuan City, which saw growth rates of 6.4 percent and 5.4 percent respectively.

Prices fell in 26 cities. The northern city of Shijiazhuang and southern city of Shenzhen witnessed price drops of 5.5 percent and 4.6 percent in July year on year.

Second-hand homes in the 70 cities rose 3 percent in July from the same period last year and 0.9 percent from June.

Chinese banks lent a record 7.37 trillion yuan ($1.08 trillion) of yuan-dominated loans in the first half, exceeding the annual target of 5 trillion yuan.

The country’s central bank announced earlier this month that new loans to home buyers in the first half rose by 263.3 billion yuan year on year to 479.3 billion yuan, boosted by an improving property market performance.
New credit for property developers increased by 221 billion yuan year on year to 403.9 billion yuan, said the central bank.

Premier Wen Jiabao reaffirmed over the weekend that the government’s relaxed monetary policy would continue.

08/07/2009 Source: People’s Daily

After more than a year of careful preparation, testing and trial operation, the China Internet Network Information Center (CNNIC) recently finished upgrading the domain name resolution system, including the central host node.

It means that at a global level, the time required to resolve Chinese and English domain names maintained by the center has been shortened from four hours to 15 minutes. Resolution speed has reached a world-leading level.

CNNIC officials said that on the one hand, the work of positioning “.??” domain names as top level domain names is proceeding smoothly and there will soon be a surge of Chinese domain name applications. On the other hand, the number of both China’s netizens and websites is increasing rapidly, and the scale of China’s 338 million netizens has sharply increased demand for domain name resolution and put forward higher requirements for China’s domain name resolution ability. The CNNIC’s timely upgrade of the domain name resolution system and their improvement of the operational capacity of the domain name infrastructure are preparations for the further expansion of China’s Internet capacity.

Experts explained that the domain name resolution service plays an extremely important role in the normal operation of the Internet. Various Internet applications such as surfing websites and sending/receiving e-mails all rely on domain name resolution service. The upgrade will further advance the service level of national domain name system, and improve the convenience of registration and application processes.

The rapid resolution speed of China’s domain name system will also significantly strengthen the international competitiveness of .CN and Chinese domain names, and further consolidate the position of .CN domain names as internationally mainstream domain names.

08/05/2009 Source: Xinhua

China vowed to deepen its financial system reform and promote more efficient financial intermediation in support of domestic demand, according to a fact sheet released here on Wednesday.

To meet the commitment, China would promote interest rate liberalization and consumer finance, said the economic track joint fact sheet of the first U.S.-China Strategic and Economic Dialogue (S&ED).

It said China would accelerate the allocation of QFII quotas to $30 billion and continue to allow foreign-invested banks incorporated in China that meet relevant prudential requirements to enjoy the same rights as domestic banks with regard to underwriting bonds in the inter-bank market.

China would gradually increase the number of qualified joint-venture securities companies that can participate in A-share brokerage, proprietary trading and investment advisory services subject to the condition of meeting relevant laws and regulations.

The country would also support qualified overseas companies to list on Chinese stock exchanges through issuing shares or depository receipts and continuously support qualified Chinese companies to be listed abroad, including in the United States, said the fact sheet.

From the U.S. side, the country would pursue comprehensive reform of financial regulation and supervision to create a more stable financial system and to help prevent and contain potential future crises.

Regulation and supervision would be strengthened to ensure that all financial firms that pose a significant risk to the financial system will be well regulated, major financial markets will be strong enough to withstand system-wide stress and the failure of large institutions, and the government has the tools it needs to respond rapidly and effectively when problems arise, the fact sheet said.

The United States pledged to continue to have strong oversight of the Government Sponsored Enterprises (GSEs). Through Congressional action, the country remained committed to ensuring that the GSEs were able to meet their financial obligations, it said.

The country was committed to undertaking a process of exploring the future of the GSEs, including through seeking public input, and the U.S. government resolved to report to Congress and the public by S&ED II.

In the joint fact sheet, China and the United States pledged continued close communication and coordination to promote financial stability and would work together to expedite the financial sector reform, to improve financial regulation and supervision, and to promote greater financial market transparency, so as to make their financial sectors more robust.

“We recognize the importance of ensuring sound regulation in our own countries and globally,” said the fact sheet.

The two countries were undertaking IMF Financial System Assessment Programs (FSAPs) and would complete them in a timely manner,it said.

Both countries would continue to promote convergence towards a single set of high quality global accounting standards and would continue discussions on financial reporting matters.

“The United States and China welcome continued dialogue between the bilateral competent authorities on the oversight of accounting firms providing audit services for public companies in the two countries based on mutual respect for sovereignty and laws,” it said.

The two countries would also conduct technical exchanges on the development of private pensions, and would share experiences and strengthen cooperation with regard to improvement of insurance regulation.

The first S&ED was held in Washington, D.C from July 27 to 28. The mechanism was jointly launched by Chinese President Hu Jintao and US President Obama during their meeting in April in London as a way to show elevation of the importance of China-U.S. cooperation under the new historical circumstances.

08/03/2009 Source: Xinhua

China’s Ministry of Commerce said on Monday it hoped the U.S. government would listen to its own industries and not impose protective measures on tires.

The comment came after the U.S. International Trade Commission (ITC) issued a statement on June 29 recommending falling tariffs of 55 percent, 45 percent and 35 percent over the next three years on motor vehicle and light truck tires from China.

The U.S. Tire Industry Association, the American Coalition for Free Trade in Tires, the American Automotive Trade Policy Council, and the Retail Industry Leaders Association have all expressed strong opposition to the planned moves.

The commission’s protectionism ploy lacked legitimacy and objective foundation, and China strongly opposed the U.S. government’s implementation of discriminatory measures against tires from China, the ministry said.

U.S. President Barack Obama will make a final decision on the issue before September 17, following an August 7 hearing.

Imposing protectionist measures against Chinese tires would not only harm the interests of China’s tire industry and Sino-U.S. bilateral trade, but also jeopardize the overall interests of U.S. economy, the ministry said.

07/24/2009 Source: People’s Daily

China and the US will discuss bilateral relations, international and regional issues, and global issues at the first strategic and economic dialogue between the two countries, said Chinese Vice Foreign Minister He Yafei.

“China hopes the strategic dialogue will help the two countries expand consensus, narrow down differences, deepen mutual trust and boost cooperation,” said He.

He added that thanks to both sides’ efforts, China-US relationship has kept its upward trend since the US President Barack Obama took office. The two countries cooperated smoothly in tackling with the global financial crisis. New achievements are made in various fields including trade, anti-terrorism, law enforcement, science, education, culture and health. China and US have worked together on regional issues such as Korean Peninsula nuclear crisis, South Asia situation and Iran nuclear issue. They have also had effective cooperation in global issues such as energy safety and climate change.

The first China-US strategic and economic dialogue is held under a background of on-going financial crisis and an unclear world economic outlook, said Zhu Guangyao, assistant Finance Minister. The theme for this dialogue is “Gather confidence for economic recovery and promote China-US economic cooperation.”

Topics to be discussed at the economic dialogue include Sino-U.S. cooperation on major economic issues, how to weather the financial crisis and achieve economic recovery, sustainable economic growth and balanced growth, building a strong financial system and, trade and investment.

He expects that this dialogue will improve the macro economic policies communication and coordination between China and the US, promote a sustainable and balanced economic growth, deepen bilateral trade and investment cooperation, strengthen cooperation in financial regulation and the reform of global financial system and create win-win economic ties between the two countries, Zhu said.

07/17/2009 Source: Xinhua

U.S. Energy Secretary Steven Chu pledged Thursday to boost clean energy cooperation with China.

“We are going to develop ideas (with China), such as how to build energy-efficient buildings, how to build cleaner power plants, especially the use of cleaner coal,” Chu told Xinhua in an exclusive interview.

He cited the technology of carbon capture and sequestration that would help to cut emissions of carbon dioxide generated in coal-fueled power plants.

“If we developed those ideas, then China can use these ideas in China and we could use these ideas in America” which would eliminate the need to pay the tariff because they could produce all the energy-saving products in domestic factories, Chu said.

This year marks the 30th anniversary of the signing of the China-U.S. agreement on scientific and technology cooperation. Chu’s three-day China tour would focus on research on environment-friendly “clean” energy, he said.

Chu defended a U.S. congress bill to levy the so-called carbon tariff on imports from countries that have no statutory restrictions on greenhouse gas emissions.

The U.S. House of Representatives passed the bill last month, which contained tough provisions to impose carbon tariffs in a bid to ensure that U.S. companies would not lose competitive advantage.

The bill was not designed to establish trade barriers, but to encourage green economies in other states, Chu said.

China, along with other countries, has voiced objections to the carbon tax, saying it was a new kind of trade protectionism under the guise of preventing climate change.

The construction of trade barriers “isn’t really good to many many things and isn’t good for the overall prosperity of all the countries involved,” he said.

Chu, a Chinese American, urged China to step up its efforts in cutting emissions of greenhouse gases.

“The United States and China are two great countries and we are emitting together 42 percent of the carbon dioxide of the world,” he said.

The stances of China, the largest developing country, and the United States, the biggest industrialized state, on the decrease of greenhouse gas emissions were crucial for the United Nations’ climate change conference, which was slated for December in Denmark’s capital Copenhagen.

A new agreement on climate change is expected to be ironed out at the conference to replace the Kyoto Protocol that set a limit for developed countries’ greenhouse gas emissions, but will expire this year.

The principle of “common but differentiated responsibilities”, a stance held by most developing countries on the reducing of greenhouse gas emissions, was “a sound one”, Chu said.

The developing countries, with much lower per capita carbon emissions than the industrialized states, were urging developed nations to reduce greenhouse gas emissions and provide technology and assistance to jointly cope with climate change.

“Should we respect those developing countries whose standard of living was much poorer?… Should they have a right to do that? Absolutely correct,” Chu said.

“But I think it is possible for even a developing country to gain prosperity and to have a better living standard and wealth for its people and still decrease their carbon emissions,” he said.

Along with Chu, U.S. Secretary of Commerce Gary Locke was also here to meet Chinese trade and energy officials, as well as Chinese leaders to discuss cooperation on energy and climate change.

“We are both Cabinet officials in President Obama’s administration and we are both Chinese Americans as well. Our roots are in China,” Chu said.

“I’m a friend of Secretary Locke so we said we should go together (to Beijing)…This visit shows the world how important the U.S.-China relationship really is,” he said.

Chu and Locke Thursday together visited the U.S. Future House, a pioneer energy-efficient building in a model park funded by the Chinese government and foreign embassies in northern Beijing.

Chu applauded the green-energy projects in the Future House, including a solar panel that generates electricity for the two-floor American-style wooden house, and the energy-saving heating and water recycling systems.
In the 400-square-meter home, Chu pointed at an LED lamp and said he was looking for such products in the United States.

“He asked me whether the lighting system in the house was made or designed in the United States, but I told him, no, it’s all made in China and we hold the intellectual property rights. He was a little bit surprised and nodded,” said Chai Guosheng, president of the Cnlight Co. Ltd, China’s largest producer of energy-efficient lights and a contractor of the house.

“It set a new standard of construction, will benefit not only China and the United States, but also every other country,” Locke said on his one-hour tour.

Locke also visited a Wal-Mart store that had energy-saving systems in downtown Beijing’s Wangjing District.

Chu and Locke arrived in Beijing on Tuesday afternoon for discussions with China on climate change and clean energy.

07/06/2009 Source: Xinhua News

The Bank of China (BOC), China’s largest foreign exchange bank, announced Monday that it had transacted the first cross-border yuan trade settlement deal Monday morning.

The BOC said its Shanghai branch had received the first cross-border yuan trade settlement deal from the BOC (Hong Kong) Monday.

The payee was Shanghai Electric International Economic and Trading Co. Ltd., a subsidiary company of Shanghai Electric Group Co. Ltd., and the remitter was the company’s business partner in Hong Kong, said the Beijing-based BOC in a statement on its Web site Monday.

The bank did not reveal the amount of the settlement in the statement.

Li Lihui, president of the BOC, said Monday at the ceremony of the first cross-border yuan trade settlement held in Shanghai that the deal could facilitate trade between China and neighboring countries and regions and help enterprises avoid exchange rate risks.

“Cross-border yuan trade settlement could help firms simplify trading procedures and reduce operation costs. It could also help banks to expand business scope, improve service, and forge stronger ties with enterprises,” Li added.

 
The BOC said its Shanghai branch had inked tentative agreements with 11 overseas agent banks on yuan trade settlement deals, which had remarkable companies yuan settlement demand, including Standard Chartered (Hong Kong), Bank of East Aisa (BEA), Hong Kong-based Wing Hang Bank and others.

On the same day, many other banks cleared transactions in yuan.

The Bank of Communications transacted the first cross-border deals.

“In the morning the Shanghai branch of the Bank of Communications has transacted six cross-border yuan settlements. The Guangdong branch and Shenzhen branch have also been dealing with the business,” said Zhang Xiaoming, head of the international business department under the Bank of Communications.

The Shenzhen branch of the Bank of Communications Monday transacted cross-border yuan settlements for two clients, Shenzhen Aerospace Guangyu Industry Group Corp. and T&J Electric (Shenzhen)Limited. The two sent yuan to their business partners in Hong Kong.

The China Construction Bank Monday said it had signed tentative deals with six overseas banks to cooperate in yuan cross-border settlement.

The BOC Monday said its branch in Guangdong Province would transact 6.93 million yuan (1.01 million U.S. dollars) of cross border yuan settlements Tuesday in forms of remitting yuan, receiving yuan and opening letters of credit in yuan.

The Industrial and Commercial Bank of China (ICBC) Monday said its branch in Indonesia had opened letters of credit of 372,000 yuan (54,466 U.S. dollars) to a company in Shanghai, indicating the launch of its cross-border yuan trade settlement.

“Cross-border yuan trade settlement could help enterprises avert exchange rate risks and reduce cost in converting foreign exchanges,” Shanghai Electric Chairman Xu Jianguo told Xinhua.

China’s State Council, or Cabinet, announced in April a pilot program to allow exporters and importers in Shanghai, and southern Guangzhou, Shenzhen, Zhuhai and Dongguan cities to settle cross-border trade deals in Renminbi(RMB), or yuan.

China last week issued detailed regulations for the pilot program for cross-border trade settled in yuan. The rules specified how to make transactions using yuan to settle trade with Hong Kong and Macao and regional trade partners.
Ou Minggang, director of the International Finance Research Center of China Foreign Affairs University, told Xinhua Monday that cross-border yuan trade settlement provided exporters and importers with another option when conducting trade settlement and banks could explore a new business area.

“This move was in line with the market needs and it could also enhance trade volume growth,” Ou added.