China's stock market boom expected in 2014Dec 27, 2013
The Chinese Academy of Social Sciences (CASS) has said there is a strong possibility that the country's stock market make dramatic gains next year when the government reopens the market for IPOs. Although there will be challenges, the CASS said in a report that a dramatic rise in the stock market could happen next year, resembling that of 1999 in many ways. Within two months from mid-May in 1999, the benchmark Shanghai Composite Index increased from around 1,100 to more than 1,600. With the relaunch of IPOs next year striking rises should be expected, experts said.
Beijing to roll out tax refunds for foreign touristsApr 27, 2015Beijing is planning to launch a tax refund scheme that will benefit foreign visitors making purchases starting this year. The plan, which aims to boost tourism and consumption in the Chinese capital, seeks to give a rebate of 11% on consumer goods purchased at participating stores. The tax refund will apply to foreign tourists as well as those from Hong Kong, Macao and Taiwan who have stayed on the mainland for no more than 183 days. The minimum purchase for a tax refund will be Rmb500 (USD82) at any store in one day. The Beijing Municipal Commission of Tourism Development is already discussing the details of the plan with revenue authorities.
China Vanke's Q1 earnings decline 59%Apr 27, 2015
China Vanke Co Ltd, the biggest residential real estate developer in mainland China, has revealed that its core profits for Q1 of this year dropped by 58.9% year-on-year. The developer added that the decline was caused by a high starting base and lower margins. China Vanke claimed however that it expects its profit to grow throughout 2015. The property-development firm announced that its core profits were at Rmb628.7m (USD101.52m) from January to March, down from Rmb1.5bn (USD240m) during the same period last year.
UK center seeks to boost China's nuclear technologyApr 27, 2015The United Kingdom’s Nuclear Advanced Manufacturing Research Centre, with the University of Sheffield and the University of Manchester in the lead, is seek to connect nuclear technology in China with that of firms in the United Kingdom to produce safer, cost-effective, and more efficient power plants. NAMRC would also like to come to China's aid in putting up an enhanced generation of nuclear-power technology that it can export, said Vice-Chancellor Keith Burnett of the University of Sheffield. In 2013, China's nuclear industry agreed to invest in the UK's Hinkley Point C project, which is led by France’s EDF group and is set to begin operating in 2023.
Shanghai urges promotion of local, int'l fashion brandingApr 27, 2015
The Shanghai city government is encouraging companies to create domestic and international brands, most especially in the mobile-Internet and fashion sectors. It is hoped that what is being called the brand economy will draw in capital, talent, and information resources from all over the world that will not be dependent on real estate and labour resources. Authorities see this helping Shanghai become a worldwide technology-innovation hub, speakers at the China Brand Economy (Shanghai) Forum said during the China (Shanghai) International Technology Fair.
India's Tata to acquire stake in China's XiaomiApr 27, 2015
Chairman Emeritus Ratan Tata of the Tata Group holding company Tata Sons has bought a stake in China's Xiaomi Technology, though no figures for the deal have been disclosed. Xiaomi, which is the third-biggest smartphone manufacturer worldwide after US-based Apple Inc and Samsung of South Korea, was valued at USD45bn last December. In the third week of April, Xiaomi conducted its first global launch outside of mainland China in New Delhi, where it unveiled its Mi 4i model which supports six Indian languages and sells for INR12,999 (USD205).
Industrial profit slips in MarchApr 27, 2015
The National Bureau of Statistics (NBS) said profits of Chinese industrial businesses dipped 0.4% year on year to Rmb508.6bn (USD82bn) in March. The decline narrowed sharply from a 4.2% slump in the Jan-Feb period, said the NBS. Dragged by the sagging performance in the first two months, China's industrial profits shrank by 2.7% in Q1 to Rmb1.25tr (USD201bn). NBS statistician He Ping attributed the improvement in March to lower raw material prices and operating costs, and higher investment returns in industrial businesses. The NBS said raw materials cost dropped 5.7% in March, from a year ago, or 0.2% more than the first two months of this year. The bureau added that financial costs of China's industrial firms were Rmb6.59bn lower in March after the central bank cut interest rates from 1 March.
China cutting number of conglomeratesApr 27, 2015
China will cut the number of government-owned conglomerates from 112 to 40 as part of a sweeping plan to overhaul the state sector, Chinese state media has reported. It is expected that the government will support massive mergers to trim its conglomerates, with the consolidation to start with the commercial sectors. Citing unnamed sources, the official Economic Information Daily reported that the consolidation will allow the government to concentrate resources on large enterprises to avoid fierce competition. The government move was reported a week after state-owned Baoding Tianwei Group decided to default on its debt, a first in China's bond market history. China currently owns 112 conglomerates, including 277 public firms listed on the country’s stock exchanges. The newspaper reported that non-core businesses of state-owned enterprises, especially in tertiary industry, would be sold publicly on the capital markets.
Private firms get go signal to import oilApr 27, 2015
China's State Council has given its permission for private firms to import crude oil, saying that it would allow 10 private companies this year to import up to 30 million tons of crude oil as part of the government's liberalization policy. The 10 enterprises will be granted oil-import franchises, allowing them to import oil through China National Petroleum Corporation and Sinopec. Last year only one private enterprise, Guanghui Energy, was allowed to import crude oil. Analysts said allowing private firms to import oil will help address oil demands of municipal oil-refining enterprises.
China to need 4,000 foreign teachers in 2015-2015 academic yearApr 27, 2015
China needs to hire at least 4,000 foreign teachers in all levels of schools this coming school year but the country is having a hard time hiring suitable candidates. CCZChina Education Co, an agency that recruits expat teachers, said the actual demand may even be greater because the statistics are incomplete. Among the reasons for the imbalance between supply and demand of foreign teachers are the strict requirements being imposed by some provinces and regions. Most of the foreigners seeking jobs in China are also looking for work that are related to their qualifications and experiences, rather than teaching work. Chen Lin, recruitment staff at China Services International, said China needed to establish ties with teachers’ associations in other countries to find experienced foreign teachers.
Pay cuts and fewer perks drive bankers to leave top banksApr 27, 2015
A growing number of bankers are leaving China's top banks due to cuts in their pay and perks, bankers and headhunters have said. Bankers affected by the pay cuts are leaving state banks to move to financial firms, including leasing companies, that are offering higher pay and more benefits, sources told Reuters. Online finance platforms, trust firms and leasing companies often offer more than double the salaries that bankers can earn at a state-owned lender, and China's top banks have decided to trim pay of senior-level state bankers as part of the government's austerity drive. Analysts said the exodus from state banks to newer finance firms could take a toll on China's top banks because they will soon have difficulties hiring and retaining talent.
China, Taiwan party heads to meet for the first timeApr 24, 2015
Chinese President Xi Jinping, who is also the Communist Party chief is set to meet with the head of Taiwan's ruling Kuomintang (KMT) party in Beijing in May, the first meeting between the heads of the two parties, the KMT announced. The meeting in Beijing will also be KMT Chairman Eric Chu's first visit to the capital since he took the reins of the KMT last November. The agenda for the meeting has not been disclosed yet but analysts said business ties between China and Taiwan, which have improved to their best level in six decades, could be one of the topics that will be discussed during the meeting.
Karen Li appointed JPMorgan’s China equity research headApr 24, 2015
JPMorgan, the biggest US investment bank by assets, is further expanding its coverage of China, appointing Hong Kong-based Karen Li as head of China equity research, a newly-created position, Bloomberg reported. Li, who will report to JPMorgan's chief of equity research for Asia, ex-Japan, James Sullivan, will retain her duties as head of Asia infrastructure and industrials research even as she has been appointed to the new China equity research role. Li joined JPMorgan in 2005. Sullivan considers China and India as the absolutely critical markets in Asia because of the normalization of both markets. JPMorgan sees incremental investment opportunity and asset reallocation to China over the next five to 10 years
Shanghai's Fanli.com to get USD100m investment from Japan's RakutenApr 24, 2015
Online shopping-rebate site Fanli.com announced that it got a USD100m investment from e-commerce firm Rakuten of Japan. Under their deal, Fanli.com will give users rewards of from 3-8% for every order placed by way of its promotion links. Fanli.com CEO Ge Yongchang said his firm will utilise the financing for potential investment or buy out companies to help out in its operations. Rakuten’s investment represents is an estimated 10% less of Fanli.com’s overall stake.
Cadillac's hybrid CT6 launched at Shanghai car showApr 24, 2015
Cadillac of the United States unveiled its CT6 Prestige Sedan for the Asian market during the Auto Shanghai 2015 fair. The General Motors division will introduce another edited version of its CT6 sedan equipped with the Plug-In Hybrid Electric propulsion system that doubles fuel economy of orthodox gasoline engines. The CT6 is just one of eight new models that Cadillac will launch this decade. The CT6 has one of the most advanced body structures in the industry.
Soft China market, forex impact forces Hershey to slash sales forecastApr 24, 2015
US-based Hershey Co on 23 April cut down on its sales-growth target for 2015 due to foreign-currency factors and a softening Chinese market. The confectioner projects sales to go up by 4.5% to 5.5% from a previous 5.5% to 7.5%. An estimated 1.5% point-negative impact from foreign exchange is a rise on its earlier estimate of a 1% point-negative impact. The company's sales declined by 0.8% in premarket trading, but Hershey believes its sales will surpass industry margins with the introduction of new products like the Hershey’s Caramels and Kit Kat White Minis.
Pernod Ricard sees better year in ChinaApr 24, 2015
Liquors-producer Pernod Ricard SA of France announced on 23 April that its business in mainland China may be back on track after a disappointing 2014. Pernod Ricard and its competitors blamed their losses on the Chinese government's ban on excessive gift giving in the bureaucracy. Although the French firm is sure that 2015 will be better in terms of revenue. Its Managing Director Gilles Bogaert said that before the year ends, Pernod Ricard's operations will stabilize in China even though its last three quarters' sales fell by 3% in the country.
Rare-earth tariffs on exports to be droppedApr 24, 2015
According to China's Ministry of Finance, export duties on the country's rare earths will be dropped starting 1 May. Observers say that this will boost exports of the minerals. Molybdenum, tungsten, and wrought-aluminum products will not have tariffs anymore. These minerals are vital to the technology and defense sectors. Du Shuaibing of resources-consultancy firm Baichuan Information said that the move will cut down the prices of rare earths by 20-25%.
China cancels new-regulations plan as forex deficit worsensApr 24, 2015
The Chinese government turned down proposals on a new set of controls on cross-border capital, even though foreign-exchange outflow surged in March -- reaching an eighth straight month of deficits worth a record-high of USD66bn. It was at only USD17.2bn in February and USD8.2bn in January, according to the State Administration of Foreign Exchange. In Q1 of 2015, overall deficit went up by 97% year-on-year, an indication of a spike in capital outflow. Trade surplus fell to a 13-month low of USD3.08bn in March from USD60.6bn in February.
ICBC unseats Wells Fargo as world's most valuable bankApr 24, 2015
The Industrial & Commercial Bank of China Ltd (ICBC) posted market capitalization of USD315bn on 23 April, becoming the world's most valuable bank, Bloomberg reported. ICBC's market capitalization was 11% more than previous leader Wells Fargo & Co. ICBC overtook the 163-year-old Wells Fargo on April 7 and the latest Bloomberg report showed that the gap between the two banks has widened. ICBC posted a net profit growth of 5.1% to Rmb276.29bn (USD45.29bn) in 2014, while its total assets hit Rmb20.61tr (USD3.32tr), up 8.9% year-on-year. Analysts said the Chinese government's monetary easing supported Chinese banks' gains by lowering funding costs and limiting bad loans.
Citigroup hires Simon Yuan as China FIG banking headApr 24, 2015
Citigroup has appointed Simon Yuan as investment banking head of China financial institutional group (FIG), as China FIG M&A and capital raising is expected to pick up. A Citigroup spokesman confirmed Yuan's appointment, which was contained in an internal memorandum seen by Reuters. Before joining the US bank, Yuan was co-head of Asia FIG at Swiss bank Credit Suisse Group. Prior to that, he worked at Goldman Sachs Group Inc and HSBC Holdings Plc in Hong Kong and Beijing. In his new role, Yuan will report to Willard McLane and Catherine Cal, Citi's Asia-Pacific head of FIG and China investment banking head, respectively. Reuters reported that China FIG M&A and capital raising is expected to pick up this year as Chinese banks shares continue to rally.
Unemployment rate slightly drops in Q1Apr 24, 2015
China's labor ministry announced that the country's urban unemployment rate slightly dropped to 4.05% at the end of March from 4.1% at the end of 2014. The Q1 unemployment figure is well within the government's target of keeping the urban jobless rate below 4.5%, as it aims to create at least 10 million new jobs this year. At a press conference, Human Resources and Social Security Ministry's spokesperson Li Zhong said that in the first three months of the year, the number of working rural population grew 3.24 million or 200,000 fewer than the same period last year.
Hormel Foods begins work on USD110m Jiaxing plantApr 24, 2015
US-based Hormel Foods Corp formally broke ground for its USD110-million facility in Jiaxing, its largest in the country, as it announced plans to further expand its investment in China. The facility, located in the Jiaxing Economic and Technological Zone of Zhejiang province, is expected to churn out annual revenues of Rmb6bn (USD967m) starting in 2016, company officials said. The facility will produce Hormel bacon, ham and sausages as well as Hormel's Spam products. Hormel said it will further expand in the country as demand for its meat products remains strong. Hormel, which entered the Chinese market in 1004, has two investment companies in Beijing and Shanghai.
China to build up to 8 nuclear power plants this yearApr 23, 2015
The China Nuclear Energy Association revealed that six to eight additional nuclear power stations will start construction in 2015 as eight new nuclear plants will be connected to the grid this year. The new nuclear power stations that will be put online this year and the construction of up to eight more will help China achieve its goal of having 58 million kilowatts online by 2020. According to Zhang Huazhu, the association's head, there are 26 units under construction in China and 23 generators that are operating commercially, churning out a total capacity of 21.39 million kilowatts. Zhang issued the statement during the 11th China International Exhibition on Nuclear Power Industry.
China's US investment forecast to grow furtherApr 23, 2015
Chinese investments, especially in real estate, in the United States are forecast to further surge, as buildings have become easy to buy in the US, Blackstone Group said. In an interview during the China General Chamber of Commerce 2015 Finance & Real Estate Forum in New York, Blackstone Chairman and CEO Stephen Schwarzman said US prices will continue to grow at a slower rate, further attracting more investment from China. He, however, urged Chinese investors to partner with local firms when making investments in the US. During the said forum, Schwarzman, whose firm manages USD310bn in assets for public and corporate pension funds, also expressed his confidence in China's economy, saying the country's chance to find a way forward is very high.