China Economy - News & Updates

[aimarraul]

Disney, Hong Kong reach $465m expansion deal
(Agencies)
Updated: 2009-06-30 14:28

The Walt Disney Co and Hong Kong's government have reached a deal to expand the territory's Disneyland theme park at a cost of about $465 million, officials announced Tuesday.

The deal, in the works over the last two years, is part of an effort to boost the fortunes of the theme park after it failed to attract as many visitors as hoped after its opening in 2005.

The park, a joint venture between Walt Disney and the Hong Kong government, will get three new theme areas, as well as 30 new attractions.

"The expansion will be a catalyst to the park's long-term development and bring benefits to not just the local tourism industry but also the entire economy," Rita Lau, Hong Kong's commerce and economic development secretary, told reporters.

Under terms of the deal, the Burbank, California-based entertainment giant will contribute all the necessary new capital for construction as well as sustaining the park's operation during the building phases. It will also convert into equity about $350 million in loans to the venture to help with funding and will keep open a credit facility of about $40 million.

Hong Kong, which shouldered much of the $3.5 billion original construction cost, will not add any new capital, the government said.

"Disney is making a substantial investment in this important project," Leslie Goodman, a Disney vice president, said in a statement.

The park came under fire after disappointing attendance in its first two years of operation. But traffic in its third year grew 8 percent, according to figures provided by the Hong Kong government.

 

[aimarraul]

Mainland, HK sign supplementary pact on RMB settlement
(Xinhua)
Updated: 2009-06-30 11:10

HONG KONG: The People's Bank of China (PBOC) and the Hong Kong Monetary Authority (HKMA) Monday signed a supplementary Memorandum of Co-operation to prepare for the implementation of a Renminbi trade settlement pilot scheme.

Speaking after the signing ceremony in Hong Kong, Zhou Xiaochuan, the governor of PBOC, said the State Council had given the green light for RMB trade settlement services to be provided in the special administrative region.

"Once the relevant administrative rules on the mainland are promulgated, banks in Hong Kong will be able to provide related services to enterprises using RMB to settle trade transactions with their counterparts on the mainland," the Hong Kong Monetary Authority, the de facto central bank of Hong Kong, said in a statement.

The mainland authorities announced in early April that Shanghai and four cities in the Guangdong Province had been selected for a cross-border RMB trade settlement pilot scheme.

Zhou said the PBOC and the HKMA had been working closely on the implementation of the pilot scheme, including the related arrangements for the cross-border settlement and clearing of RMB funds and amendments to the existing legal documents.

The two central banks have previously signed Memorandum of Co- operation as early as 2003 on RMB clearing services sought after by individuals in Hong Kong.

Authorities would still need to work on details after the signing of the agreement Monday, including the signing of agreements between PBOC, the clearing banks and banks participating in the pilot scheme, HKMA Chief Executive Joseph Yam said.

Yam said he expected the first RMB trade settlement to come in July.

John Tsang, the Financial Secretary of the Hong Kong Special Administrative Region (HKSAR) government, said the pilot scheme would not only strengthen the role of Hong Kong as a testing ground for the use of RMB outside the mainland, but was also conducive to trade activities and economic development in the two places.

"This will also provide Hong Kong enterprises with more flexibility in their operations, and is complementary to the policy initiatives of the Government to assist them in withstanding the impact of the international financial crisis," he said.

Yam said the pilot scheme, once implemented, would help further diversify RMB business in Hong Kong and enhance the capability of Hong Kong financial system in handling RMB-denominated transactions.

"I hope that RMB business in Hong Kong will continue to develop, consistent with the policy direction of further developing a mutually-assisting, complementary and interactive relationship between the financial systems of the mainland and Hong Kong."

"This is of strategic importance," he said.

 

[Communist]

@ aimarraul,

Try to post the links and some photos if possible.

And congratulations!!! Today the CPC is 88 years old!!

 

[wtf]

From the Freakonomics blog.

Why the Chinese Save - Freakonomics Blog - NYTimes.com

Some say that a major cause of the U.S. housing bubble was a surge in savings overseas, particularly in China, where the personal savings rate soared to 30 percent of disposable income. (In the U.S., meanwhile, we were saving next to nothing). Just why the Chinese were saving so much has been a puzzle to many economists. Now Shang-Jin Wei and Xiaobo Zhang think they’ve come up with an explanation. It turns out that China’s “one child” policy, which created a huge surplus of men in the country, has driven up the cost of getting married, as more and more men compete for fewer and fewer women. To keep up, families with sons have been holding off on spending to save up wealth that boosts their children’s marriage prospects. In their paper, Wei and Zhang argue that Chinese marriage-price inflation could account for as much as half of the increase in the country’s household savings since 1990.

 

[wtf]

The actual paper
The Competitive Saving Motive: Evidence from Rising Sex Ratios and Savings Rates in China

 

[wtf]

If the paper is true then the savings 'problem' might soon spread to India and Pakistan.

Pakistan has a sex ratio of 1.05:1 , India has 1.065:1 and China is at 1.08:1. Wonder if the Indian dowry trend will reverse ? (Does Pakistan have dowry or meher? )

 

[aimarraul]

chinese save money for the next China-india瘪三 war

 

[BelligerentPacifist]

8 men more for each 100 women should hardly have such a huge impact in savings, though it should matter. The chinese, and I'd say the Indian too, ethos are such that people don't squander off all their earnings. At least among more traditional people.

Pakistan is plagued by a similar dowry issue as India. I don't think meher is as big a problem as dowry. The bad new development is that people are allegedly now handing wishlist to the other party. The good one is that, in my limited experience, people who are into religion often refuse dowry.

 

[sob]

There is no end to the theories being forward by economists today.

This is a traditional thing in Asia where the savings rate is very high compared to Europe and America.

But IMO it is due to the lack of Social Security net in these countries. When you know that in old age and in sickness you have to take care of yourself then you better start saving from day one.

Better still it is this high savings rate in India and China that has insulated them to some extent from the current economic turmoil.

 

[glomex]

Most of the western countries have overspent their income...they are practically Broke..... so theories like these are circulated in media so as to lure people spend more ..and pull money from developing countries to so called developed countries which are dying for money to feed their failed systems...

 

[wtf]

chinese save money for the next China-india瘪三 war

-----------------------------

 

[wtf]

There is no end to the theories being forward by economists today.

It is the freakonomics blog... the author (of blog) made a bunch of money on a book that correlates abortion with reduction in crime.

 

[sob]

Got your point, no point freaking out over this

 

[aimarraul]

General Motors: China sales up 38% in first half of 2009
(Agencies)
Updated: 2009-07-01 14:30

SHANGHAI: General Motors Corp. said Wednesday that sales in China jumped 38 percent in the first half of 2009, helped by strong demand for its minivans and other small vehicles.

GM sold more than 100,000 vehicles a month in China in January-June for a total of 814,442, a record for any half-year, the company said in a statement. That compares with sales of 1,094,561 GM vehicles in China for all of 2008.

Strong growth in China and other emerging markets is crucial for GM's recovery as it works to emerge from Chapter 11 bankruptcy back in the United States. While GM has slashed jobs and closed factories back home, it is still expanding in China.

"China's vehicle market continued to outpace most expectations for growth," said Kevin Wale, GM's China Group president and managing director. "We continued to enjoy strong demand for many of our existing products and new models."

The increase in sales was helped by stimulus policies, such as subsidies for replacement vehicles, and by strong growth in inland cities that have lagged behind China's wealthier coastal areas.

China's total passenger car sales surged 21 percent in January-May, to 3.36 million units, while total vehicle sales climbed 14.3 percent to 4.96 million units, according to industry figures.

Industrywide sales are forecast to top 10 million units this year. In 2008, China's auto sales grew 6.7 percent to 9.38 million units - the first time growth has fallen below 10 percent since 1999.

GM's minivan joint venture in southern China's Guangxi province, SAIC-GM-Wuling, has thrived under government policies aimed at promoting use of more fuel efficient, less polluting vehicles.

SAIC-GM-Wuling sold 524,598 units in January-June, up nearly 50 percent from the first half of 2008.

Its most popular vehicle, the Wuling Sunshine minivan sold 295,789 units, while sales of the Wuling Rong Guang premium minivan, which was launched a year ago, nearly topped 100,000 units. SAIC-GM-Wuling sold 32,056 Chevrolet Spark mini-cars, up 60.0 percent over the year before.

Other big sellers included the Excelle sedan and other Buick models.

Despite its financial woes elsewhere, Wale has said GM's eight joint ventures are sticking to their target of doubling sales from 2008 to about 2 million within the next five years.

 

[aimarraul]

CNPC-BP consortium wins bid for Iraqi oil field
By Hou Lei (chinadaily.com.cn)
Updated: 2009-07-01 11:39

A consortium led by the Chinese National Petroleum Corp (CNPC) and British giant BP PLC (BP) won the deal to develop the Rumaila oil field in southern Iraq on Tuesday.

The consortium grabbed Iraq’s first oil fields development contract to foreign capitals since 1972.

Eight of the world’s top 10 non-state oil producers were among more than 30 companies vying for $16 billion worth of technical service contracts.

An international consortium led by US giant Exxon Mobil won the bid for Rumaila but later rejected the Iraqi government's proposed higher cost of production per barrel.

Under the service contracts, companies winning the bid would be paid by Iraq a per barrel fee for any crude they produced in excess of a minimum production target.

The BP/CNPC alliance agreed to develop the field at a cost of $2 a barrel for excess production, lower than the US$3.99 BP and Exxon initially bid. The Exxon Mobil-led consortium offer was US$4.8 per barrel, according to an earlier report from Reuters.

Rumaila holds 17.8 billion barrels in crude reserves, making it the biggest oil field in Iraq.

Iraq failed to strike deals on the remaining seven oil and gas fields in the auction.