China Economy Forum

[Brotherhood]

China's March PMI of non-manufacturing sector rebounds: CFLP - People's Daily Online
April 03, 2011

The Purchasing Managers Index (PMI) of China's non-manufacturing sector rose to 60.2 percent in March, the China Federation of Logistics and Purchasing (CFLP) said Sunday.

The March index was higher than the 44.1 percent in February and 56.4 percent in January.

Source: Xinhua

 

[Brotherhood]

First highway on Pamirs Plateau to open in 2013 - People's Daily Online April 01, 2011

A highway running through the deep gorges and treacherous currents of the Pamirs Plateau is expected to soon be built in Xinjiang.

The road, which will be the first highway on the Pamirs Plateau, will be completed and opened in September 2013.

The quick trade route connects Kashgar, an important city in western China, and the Irkeshtam Port. The preparatory work for the highway's construction has been completed, and the construction will soon start, according to the Xinjiang Highway Administration.

The 213-kilometer highway, with total investments of 4.3 billion yuan, begins in the north of Takuti in Artux and ends at the Irkeshtam Port.

After the completion, two national first-class highway ports will be connected and the highway will become an important channel from China to Central Asia, North Asia and West Asia.

By People's Daily Online

 

[Brotherhood]

Xinjiang begins construction of 18 water conservation projects - People's Daily Online

April 03, 2011

Eighteen water conservation projects in northwest China's Xinjiang Uygur Autonomous Region started construction on Saturday in a bid to help nomadic families settle down.

Seventeen reservoirs and a water diversion project will be built in 18 counties in Ili, Tacheng, Altay, Bortala, Changji, Hami and Bayingolin prefectures, according to a spokesman for the regional water resources department.

The projects will cost 1.44 billion yuan (about 220 million U.S. dollars) and have a total storage capacity of more than 95 million cubic meters, said the spokesman.

The projects are expected to help more than 17,000 nomadic households settle down by increasing and improving 107,000 hectares of irrigated areas after their completion in the winter of 2012, said the spokesman.

The 18 projects are among the region's 27 water conservation projects planned to improve the living standard of local nomads. The construction of nine other projects, including eight reservoirs and a water diversion project, started in June 2010.

The 27 projects will cost 1.95 billion yuan with joint funding by 20 companies and the Xinjiang regional government.

Xinjiang has nearly 1.23 million herdsmen, 60 percent of whom move from place to place due to difficult living conditions.

The improvement in water supply will enable nomads to engage in animal husbandry and farming to increase their income, said the spokesman, adding that nomads can enjoy better educational services and health care after settling down.

Source: Xinhua

 

[Brotherhood]

Sino-Israel trade boosted for mutually benefits - People's Daily Online
April 04, 2011

Israeli government has decided to spend some 28 million U.S. dollars on helping its exporters to increase their business ties with China and India.

Europe and the United States have been in the past the two top markets for Israeli exports. But as both these two are struggling to recover from the 2008 global economic crisis, many Israeli companies have turned their attention eastwards instead to keep the business going.

During a recent visit to Israel, Chinese Commerce Minister Chen Deming said that "China sees great opportunity in its cooperation with Israel," adding "the fields of cooperation have expanded considerably, from agriculture to renewable energy, bio-medicine, electronics, communications and desalination."

Sino-Israeli trade volume reached 7.65 billion U.S. dollars in 2010, nearly 150 times of the number in 1992, when the two countries established diplomatic relations.

Analysts speaking to Xinhua on Sunday said that Sino-Israel trade is mutually beneficial: Chinese companies are looking to buy Israeli technologies to continue their rapid economic development, and Israeli companies are trying to enter China's vast domestic market.

WIDE RANGE

Ilan Maor, managing director of SHENG-BDO Ziv Haft, a leading business development and investment company and a member of the advisory board for that Israel-Asia Center, said that Chinese and Israeli companies are doing business in a wide range of fields.

"Chinese companies come to Israel for a few things but, first of all, purchasing," Maor told Xinhua, adding that "Israel has products that are useful in order to improve agricultural and industrial yields."

Other areas of interests include water desalination, agriculture, clean energy, and IT, according to Maor, who was in Shanghai when he spoke to Xinhua. He, by giving an example, said that the company he was working with at the moment has developed a technology that allows a farm to produce more milk without buying more cows.

"Israel has very advanced technology in various sectors, and China is growing very fast," Maor said. "Therefore, they need a lot of technologies, and Israel is a leading source of new technologies."

When it comes to Israeli companies, Maor said that first of all they are looking to enter China's domestic market, which he described as "amazing."

He added that, while in the past Israeli companies that came to China were looking for a place where they could produce their products at cheap prices, the trend today is changing. Israeli firms are now looking for Chinese partners, both those that can provide funding for a global expansion but also technology partners for continued development.

Israeli analysts are of the opinion that China is also interested in Israeli military technology. However, since much of it is developed either in cooperation with American firms or with funding from the United States, Israel is very cautious in what it can export in this field in order not to act against its understandings with the U.S. regarding military export to China.

Israel is very "strict" in its defense exports to China, and " will not dare to jeopardize its relations with the U.S., on which it depends so heavily," said Dr. Yoram Evron from the Department of Asian Studies at the University of Haifa.

PUSH IN FUTURE

Evron believes that Israel is unsatisfied with the growing trade deficit with China, and apparently is frustrated by, and even concerned about, its "failure" so far to penetrate to the Chinese market.

He noted that Israel has launched several national programs that are aimed at this goal, but none of them has brought the expected results.

"As for Israeli companies, many of them consider the Chinese market as too risky due to allegedly Intellectual Property Rights violations, communication problems, and business cultural gaps," Evron told Xinhua, adding that "therefore prefer not to operate there, or to do it in relatively small scale."

Evron said that Sino-Israel trade relations are first and foremost characterized by their rapid rise over the last decade from around 1 billion U.S. dollars in 2000 to over 4.5 billion dollars in 2009.

The recent-announced funding program is considered as part of a long-term strategy of the Israeli government to assists local companies enter the Chinese and Indian market.

"The Israeli government has made an evaluation on where they believe Israel's economic future lays," said Ornit Avidar, a partner at China-Israel Venture Capital Fund.

"Once they decided that it lays in China and India, they said we are going to put out money where our mouth is," he added.

According to Avidar, the Israeli government has set up several task forces, one of which Avidar is severing, to specify how the government can help, including getting over cultural differences and assistance with establishing the initial contacts.

"To be able to compete in the Chinese market, you need a lot of funding and this is where the Israeli government picked up the glove and said we understand and we are willing to finance," Avidar told Xinhua.

Source: Xinhua

 

[Brotherhood]

New energy sector eyeing development due to aviation carbon tax - People's Daily Online April 04, 2011

As a new carbon tax sets China's aviation industry fidgeting over projected losses, Fu Pengcheng, a Chinese biofuel expert, is feeling the pressure.

Fu's office at the China University of Petroleum is developing new biological fuels. China's major airlines are now looking to his research to trim their flights' carbon emissions.

"We don't have much time. A locally-developed biofuel is desperately needed to protect our aviation industry and China's national interest," said Fu.

An advanced new energy sector would not just benefit the environment but also protect China against unfair attacks from foreign countries, said Fu.

Fu was referring to an EU plan to levy carbon emission taxes on flights departing or landing in the region starting next year. Airlines whose emissions exceed a set quota will be forced to buy extra credits from less prolific polluters in the industry.

Both China and the United States have expressed their disapproval, accusing the rule of being motivated by unilateralism and protectionism. Chinese airline operators complained that the unfair charge would cost them an additional 122 million dollars per year.

As a contingency plan against the worst-case scenario, Chinese airlines have launched reforms in the flight service to limit the carbon emissions yet having only achieved a modest effect.

"The kerosene, used commonly as fuel for aircraft accounts for 90 percent of the carbon emission of the fleet, prompting many countries to develop biofuel as a substitute," said Fu.

Boeing, for example, has been successful in its biofuel experiments conducted in Australia, America, and the Middle East, which bode well for the future application, said Al Bryan, vice president of Boeing's R&D in China.

"So far, we've tried a 5:5 blend of biological and conventional fuels in our pilot flight, and we expect the proportion of biological fuel to rise to 90 or 100 percent in the future," Bryan told Xinhua.

Furthermore, the sources for biological fuel, which includes alga, jatropha, and flax, would not encroach upon land and water resources need for food crops, said Bryan.

Despite the bright prospects, experts said that China's search for substitute fuels lacked momentum due to too little commercial investment and government support.

"China boasts significant breakthroughs in the lab testing of biological fuels, but most research ended in the laboratory stage," said Liu Minsheng, a leading researcher of XinAo Group. XinAo is a pioneer company in research for algae fuels sources.

Liu Zhongtian, a researcher at the Qingdao branch of the Chinese Academy of Science, echoed the sentiment, saying that the institution lacked impetus to further promote biological fuels.

In its 12th Five-Year Plan (2011-2015) released in March, China said it aims to raise its share of non-fossil fuel energy to 11.4 percent of total energy use, a heartening news to Chinese biological researchers.

"We are yearning for more financial support from the government, which is critical to the industrialization of biological fuels," said Liu Minsheng.

Source: Xinhua

 

[Brotherhood]

China's largest coal producer builds processing project on China-Mongolia border - People's Daily Online
April 04, 2011

China Shenhua Energy Co. Ltd., the country's largest coal producer, has planned a huge investment to build a coal processing project on China-Mongolia border to better use coal imports from the Republic of Mongolia.

The government of Wulate Middle Banner (County), north China's Inner Mongolia Autonomous Region, on Sunday confirmed that construction of Shenhua's project with a planned investment of 10 billion yuan (1.5 billion U.S. dollars) has started in Ganqimaodu Customs Processing Park.

Ganqimaodu Customs is China's major energy imports gateway with the Republic of Mongolia. It handled 7.71 million tonnes of coal imports last year. The imports of raw coal via the customs soared by 131.8 percent year-on-year in the first quarter to reach 1.6 million tonnes, according to the customs figures.

The Wulate Middle Banner commission of development of reform said Shenhua's project slated for the first phase production by 2012 would have a coal washing ability of 6 million tonnes a year, coking capacity of 2.4 million tonnes a year and an annual capacity of producing 4.8 million tonnes of methanol and 30,000 tonnes of tar, respectively.

Source: Xinhua

 

[Brotherhood]

First batch of electric cars hits Shanghai streets - People's Daily Online April 07, 2011

Eight car owners mounted license plates on the first batch of privately-owned electric car owners in Shanghai on April 6.

"Given the high oil prices, the cost of driving gasoline cars is too high, while the cost of driving electric cars is much cheaper," said Ms. Huang, who works as an accountant.

She calculated, "My electric car costs me about 10 yuan per 100 kilometers, 50 yuan cheaper than a gasoline car."

She added that it will be convenient for her to charge the electric car at charging posts and stations that are being built near her office and will soon be built in her residential community.

"I bought my electric car for only 120,000 yuan thanks to a rather large amount of government subsidies the car enjoys," she said.

The development of various types of infrastructure projects at the Shanghai International Automobile City is currently in full swing in order to accelerate the construction of the international electric vehicle demonstration zone.

The construction of supporting facilities covering a total area of 100 square kilometers will be completed by the end of 2011, and charging infrastructure will cover the entire demonstration zone in Jiading District by the end of 2012.

By Zhang Hongyu, People's Daily Online

 

[Brotherhood]

China to build 56 more airports in five years: official - People's Daily Online April 07, 2011

A senior Chinese civil aviation official said in Guiyang Thursday that China, the world's most populous nation, would build 56 more airports during the next five years to expand transport capacity.

Li Jiaxiang, head of the Civil Aviation Administration of China (CAAC), said the total number of airports in the country would likely top 230 in five years with an aircraft fleet expected to exceed 4,500 units, enough to carry 450 million passengers annually. ' "Investment in China's aviation industry is likely to reach 1.5 trillion yuan (about 230 billion U.S. dollars) in the next five years," Li said at a national civil-aviation work conference held in Guiyang, capital city of southwest China's Guizhou Province.

China's investment in building airports has accelerated since the turn of the century. From 2005 to 2010, 33 new airports were constructed while another 33 were renovated or expanded, bringing the total number of airports to 175 in 2010.

Investment in building civil aviation infrastructure during this period hit 250 billion yuan, nearly the equivalent of total spent during the previous 25 years.

Source: Xinhua

 

[Brotherhood]

China-Singapore visa-free agreement to take effect in April - People's Daily Online April 07, 2011

The mutual visa-free agreement for Chinese and Singaporean diplomatic, official and official ordinary passport holders will come into effect starting April 17, according to the website of China's Ministry of Foreign Affairs.

According to sources, the "Mutual Visa-Free Agreement of the PRC Government and the Government of the Republic of Singapore on Diplomatic, Official and Official Ordinary Passport Holders" was signed in Singapore on Feb. 18, 2011. The two sides have completed their legal procedures and confirmed that the agreement will come into effect starting April 17, 2011.

The agreement said that Chinese citizens holding valid diplomatic, official and official ordinary passports and Singaporean citizens holding valid diplomatic and official passports are able to enjoy 30-day transit visa-free service for entering the other contracting country.

Chinese and Singaporean citizens who want to enter the other contracting country and stay for more than 30 days or for the purpose of working, studying or any profitable activity should apply for visas and passports in accordance with relevant provisions of competent authority before arriving at the territory of the other contracting country.

By People's Daily Online

 

[Brotherhood]

China aims for top place in new-fuel vehicles - People's Daily Online April 08, 2011

China will launch a new-energy vehicle development plan to make the country a global leader in energy conservation and new-fuel autos over the coming 10 years, powered by an initial package of government funding as high as 100 billion yuan.

The Beijing-based China Daily reported on Friday that the long-expected roadmap for vehicles, to be powered by non-fossil fuel resources, has been jointly drafted by the Ministry of Industry and Information Technology (MIIT), the Ministry of Science and Technology, the Ministry of Finance and the National Development and Reform Commission.

The report quoted So Bo, a deputy minister of MIIT, said the plan has been submitted to the State Council, which Premier Wen Jiabao heads, for final discussion and approval. The central government in Beijing is widely expected to bestow incentives for customers to buy electric cars, and other vehicles powered by new energies.

The draft plan has a specific focus on hybrid and electric vehicle development and marketing in China. The government's total investment into the sector will hit 100 billion yuan, the report said.

Beijing is aiming for the top position in the global new-energy vehicle sector with a planned sales volume of 5 million units by 2020, the report said. The draft plan also said that during the country's 12th Five-Year Plan (2011-15), China will have a production capability of 1 million new-energy vehicles, with pure-electric and plug-in hybrid vehicles accounting for 50 percent.

To encourage customers to buy new vehicle, Wang Xiaoming, a research fellow at the Industrial Economics Research Department of the Development Research Center of the State Council, was quoted by the Bloomberg News as saying that, the government has decided to lower the price of batteries used for electric vehicles to 2 yuan for each watt-hour by 2015 and 1.5 yuan a watt-hour by 2020, as incentives to lure customers.

Chen Qingquan, chairman of the World Electric Vehicle Association, said he anticipated China will lead the electric-vehicle sector growth, which is expected to accounting for 10-15 percent of the total auto sales worldwide by 2020.

"The Chinese government's focus on pure-electric and plug-in hybrid vehicles is strategic and quite reasonable to make the nation's auto industry competitive in the global market, as Western countries have dominated the traditional auto technologies," China Daily quoted Gao Li, an auto analyst with Huachuang Securities, as saying.

By People's Daily Online

 

[no_name]

I wonder how airlines and military plane will evolve when petrol runs out or just getting more and more expensive. Hopefully they are already looking into this.

 

[Brotherhood]

Airbus shifts marketing focus to China - People's Daily Online April 08, 2011

According to Airbus China on April 7, it plans to sell five to six business aircraft in China each year over the next five years. Chinese orders now account for about one-fourth of Airbus's worldwide orders for business aircraft.

Chinese buyers are expected to become the main market of luxury business aircraft in the foreseeable future.

There are currently six Airbus business aircraft in operation in China, of which three were registered on the Chinese mainland. Soon, another two business aircraft will be put into operation in the country.

"China's strong economic growth is the basis for its booming business aircraft market," said Eric Chen, vice president of Airbus China.

Chen said that Airbus sold its first business aircraft in China in 2005 and has sold more than 20 aircraft in China ever since, which amounts to about four aircraft a year on average. Many buyers are from Shanghai, he said.

Chen said that Airbus is shifting its business aircraft marketing focus to Asia, especially China. The company plans to sell about 30 business aircraft in China over the next five years. Since it is able to manufacture only 12 to 24 business aircraft a year, one-fourth of its business aircraft will be sold to Chinese buyers each year.

Airbus specifically introduced a Phoenix cabin concept to appeal to Chinese buyers. The Phoenix cabin features seats for six people around a large round table — reflecting the focus on family life in many Asian cultures. The table can be easily folded into a rectangular shape when needed, so passengers will feel more comfortable when playing mahjong. The cabin even offers an area for Karaoke, another popular recreational activity in much of Asia.

Airbus said the A318 Elite business aircraft is priced at 65 million U.S. dollars, the ACJ business aircraft is priced at 80 million U.S. dollars, and the A320 VIP business aircraft is priced at 85 million U.S. dollars.

By People's Daily Online

 

[Brotherhood]

China to encourage foreign investment in emerging industries - People's Daily Online April 08, 2011

China welcomes foreign investors in its "strategic emerging" sectors, the Shanghai Securities News reported Thursday, citing a draft guidance for foreign investment released by the Legislative Affairs Office of the State Council.

According to the guidelines, China is to encourage foreign investment in emerging industries, such as lightweight and eco-friendly metals for aviation and auto industries, and batteries for electric cars, key components for new-energy cars.

China will also promote foreign investment in the service sector, including leasing and business services, according to the draft guidelines.

Notably, foreign investment in manufacturing and R&D in the country's auto industry, is not listed in the newly-released guidelines.

The draft was initiated by the National Development and Reform Commission and the Ministry of Commerce, seeking to solicit public opinion before the end of April.

The current guidelines for foreign investment in China were last revised in 2007.

Source: Xinhua

 

[Aramsogo]

I wonder how airlines and military plane will evolve when petrol runs out or just getting more and more expensive. Hopefully they are already looking into this.

It will never run out. They will switch to syn-fuels (synthetic jet fuel) using coal and Fischer-tropsch process like the Nazis did.
When coal runs out we should have warp drives by then.

 

[Brotherhood]

China 'opening wider' for FDI - People's Daily Online April 08, 2011

China will "open wider" to the world by encouraging foreign companies to invest, for the first time, in certain industries under a new draft regulating foreign investment, experts said.

The select industries, in the recently released Foreign Direct Investment Industry Guidelines, include high-tech, clean energy, aerospace and aviation, new materials, high-end manufacturing and advanced logistics. The guidelines will replace the previous version, published in 2007.

There are also changes in the services sector with vocational education and training encouraged in the guidelines and the medical professions are no longer excluded.

"The new version highlights China's commitment to opening wider and further in both high-end manufacturing and the modern service sectors," said Wang Zhile, director of the research center on transnational corporations under the Ministry of Commerce.

"It is also in line with China's 12th Five-Year Plan (2011-2015) on building itself into a more innovative society and on improving social welfare."

The guidelines come after a foreign direct investment (FDI) directive was issued last April encouraging more investment in the high-tech, renewable energy and service sectors, and to focus more on western and central areas.

The guidelines follow criticism by some foreign companies of China's investment environment in the latter half of last year.

"China has no reason to say no to the opening-up policy," said Li Xiaogang, director of the Foreign Investment Research Center at the Shanghai Academy of Social Sciences.

"The more open China is to the world, the more benefits China will get and the more competitive local industry will be.

"The new version is undoubtedly good news for local industry and foreign companies."

The guidelines are still being formulated and a month-long program soliciting public opinion commenced at the beginning of April.

The first guidelines were published in 1995, and they are amended every four years. The new guidelines, when implemented, will be the fifth version and should be issued in the coming months.

"As the new guidelines show, China is allowing many strategically important and emerging industries to get foreign investment," said Huo Jianguo, director of the Chinese Academy of International Trade and Economic Cooperation, a think tank affiliated to the Ministry of Commerce.

But the guidelines also prohibit foreign investment in some sectors. Foreign companies, for the first time, are excluded from some energy industries, including crude oil and nuclear fuel processing and chemical manufacturing.

Foreign companies are also prohibited from industries dealing in certain metals and marine resources as well as seed selection and production and processing agricultural goods.

"The prohibition is understandable," Huo said. "China has to say no to foreign investment in some sectors for the sake of protecting its industries and natural resources."

In February, the State Council announced it would set up a ministerial panel to examine foreign companies' proposals on buying, or merging with, domestic firms involved in defense and national security.

Government officials have consistently said that the nation always welcomes foreign business.

FDI hit a record high last year, growing by 17.4 percent from a year earlier to $105.74 billion, after dropping by 2.6 percent in 2009. From January to February, China's FDI grew by 27 percent year-on-year to $17.8 billion.

Source: Xinhua