ACBW Feature Articles

Shanghai rebuts 'new' tight policy

Wed, 16 May 2012 04:18:00 GMT

SHANGHAI has rebutted some media reports claiming that its ban on purchase of second home by single, or unmarried, buyers since February was a "new" tightening policy.

"The city hasn't introduced any new policies on home purchase restrictions, and a local government document released in February already made it very clear that grown-up children who don't have any property solely under their names will be allowed to make one purchase for marriage purposes," said a statement posted yesterday on the official website of the Shanghai Municipal Housing Support and Building Administration Bureau.

Some media reports on Monday said some district-level housing authorities, including Yangpu, Hongkou, Jinshan and Songjiang, have recently banned buying of second home by singles, citing this move as evidence the city has further tightened its property policies. The reports claimed that such purchase was allowed a month earlier in some districts but has recently been barred.

"The clarification made by the municipal housing bureau just indicated again that the government remains resolute in maintaining its property curbs," said Song Huiyong, director of research at Shanghai Centaline Property Consultants. "Such a ban is quite reasonable because it both takes into account the real demand of grown-up children and preventing speculation."

Shanghai and about 40 cities in the country have imposed curbs on home buying since last year.

Oversupply in platinum market on recycling

Wed, 16 May 2012 04:06:00 GMT

THE global platinum market suffered an oversupply of 430,000 ounces last year as more than 2 million ounces were recycled, according to a recent report. British chemicals and precious metals company Johnson Matthey Plc said in a report that primary supplies of the metal grew 7 percent last year to 6.48 million ounces, a four-year high, mainly due to inventory releases from South Africa and higher output in North America.

Gross demand gained 2 percent to 8.1 million ounces in 2011 amid heavy purchasing by the glass and petrochemical industries, while physical investment sank 30 percent from the previous year.

But recycling increased by 12 percent to 2.05 million ounces, giving a net demand of 6.05 million ounces. But this resulted in the global market's oversupply of 430,000 ounces.

In China, platinum jewelry grew robustly last year despite the price movements of the metal, the report said.

The metal price fell to a two-year low of US$1,364 per ounce by the end of 2011, reflecting the supply surplus and a wider asset sale by investors in the fourth quarter. But the average trading price of US$1,721 per ounce for the whole year was up 7 percent from the previous year.

The London-based precious metal specialist expects supply and demand for the metal to drop this year.

"We foresee that supply and demand fundamentals will have a greater influence on the platinum market in 2012," the report said.

"There will be constraints on sales from South Africa leading to a reduction in global supplies."

Shanghai rebuts 'new' tight policy

Wed, 16 May 2012 04:05:00 GMT

SHANGHAI has rebutted some media reports claiming that its ban on purchase of second home by single, or unmarried, buyers since February was a "new" tightening policy.

Shanghai and about 40 cities in the country have imposed curbs on home buying since last year.

China stays optimistic despite decline in FDI

Wed, 16 May 2012 04:03:00 GMT

FOREIGN direct investment in China fell for a sixth straight month in April as European investors continued to cut overseas spending.However, capital from Asia and the United States picked up. Inbound foreign investment was down 0.74 percent from a year earlier to US$8.4 billion last month, the Ministry of Commerce said yesterday.

The decline moderated from the cut of 6.1 percent in March, but was still much less than the 9.7 percent increase last year.

"Sluggish economic growth around the world and much fiercer global competition for new investment continue to weigh on China's strength in absorbing foreign capital," said Shen Danyang, a ministry spokesman. "Also, China is losing comparative advantage when production costs in the country are rising continuously."

But China still maintains its "prudent optimism" due to the country's improving environment for foreign investment, Shen said.

According to a recent report by Japan Bank for International Cooperation, China and India remain the top two investment destinations for Japanese manufacturers seeking overseas expansion.

Singapore's United Overseas Bank also listed China as the best choice for investment in its latest report.

"We are not pessimistic about the declining foreign investment in the past half year," Shen said.

He said the ministry had not detected any withdrawal of existing foreign investment. But the ministry couldn't rule out such a possibility in future, Shen said.

Xue Jun, an analyst at CITIC Securities Co, said that although China was losing the edge of cheap labor costs, the vast domestic consumer market remained a strong magnet for investment.

"Investors are looking for markets that can generate demand and produce profits amid a sluggish global economy, and China is the place," Xue said.

China's gross domestic product growth weakened to 8.1 percent in the first quarter, the slowest in nearly three years. But economists said that would be the bottom of this round of economic slowdown, with the pace picking up to around 8.5 percent in the current quarter.

In the first four months, foreign investors set up 7,016 new enterprises in China with a total investment of US$37.8 billion, a reduction of 2.38 percent compared with a year earlier.

Capital from the 27-member European Union lost 27.9 percent to US$1.9 billion in the January-April period.

In comparison, Japanese investors raised their investment by 16 percent to US$2.7 billion, and capital from the US gained 1.9 percent to US$1.05 billion.

China's outbound non-financial foreign direct investment climbed 72.8 percent to US$23.1 billion in the first four months, up dramatically from last year's growth of 1.8 percent, the ministry data showed.

Xu Sitao, global forecasting director for China at the Economist Intelligence Unit, said the world was set to see more investment from China from both state-owned and private companies.

He estimated outbound investment could reach US$200 billion with China's gross domestic product per head nearing US$10,000.

Greece fails to form government

Wed, 16 May 2012 04:01:00 GMT

ATTEMPTS to form a government in Greece collapsed yesterday, jolting financial markets at the prospect leftists opposed to the terms of a European Union bailout could sweep to victory in a June election and nudge the eurozone crisis into a dangerous new phase.

The turmoil in Athens sent waves around other troubled members of the 17-nation European single currency area. The euro slipped below US$1.28 while Spanish and Italian bond yields rose above the danger level of 6 percent as investors scurried for shelter in safe haven German Bunds.

The tremors from Greece, compounding worries about Spain's debt-laden banking system, ended any honeymoon for new French President Francois Hollande, thrusting the growing risks to the eurozone to the top of the agenda for his first meeting with German Chancellor Angela Merkel.

In Athens, a spokesman for President Karolos Papoulias said his efforts to broker a compromise on a cabinet of technocrats to steer the country away from bankruptcy had failed. A caretaker government will now be formed pending a new vote, probably in mid-June.

"For God's sake, let's move towards something better and not something worse," Socialist leader Evangelos Venizelos told reporters after party leaders met the head of state.

Eurozone finance ministers dismissed talk of Greece leaving the single currency area as "propaganda and nonsense" on Monday. But with hostility to EU/IMF-imposed austerity rising in Greece, speculation about a possible exit is rattling financial markets.

The left-wing Syriza party, which surged to second place in last week's election on an anti-austerity platform, rejected all compromise with pro-bailout parties, emboldened by opinion polls showing it could top a second vote.

EU officials are hoping Hollande's election will revive proposals for solutions to the debt crisis such as issuing joint eurozone bonds, which Merkel has so far blocked.

Markets and policy-makers are watching the dialogue between the German chancellor and the French leader for signs that they can overcome their differences on Merkel's drive for austerity and lead the eurozone together.

Merkel and former French President Nicolas Sarkozy had dominated eurozone crisis management since the debt turmoil began in late 2009, earning the nickname "Merkozy" for their sometimes disputed leadership.

Her relationship with Hollande, which one French pundit has already dubbed "Homer" perhaps due to its Greek challenge, may initially be cool as they are from opposing political families.

Surprisingly strong first quarter growth figures for Germany relieved pressure on shares and the single currency yesterday, but worries about the deepening impact of the euro crisis and a possible Greek exit kept demand for safe-haven assets strong.

Greece fails to form government

Wed, 16 May 2012 04:01:00 GMT

"For God's sake, let's move towards something better and not something worse," Socialist leader Evangelos Venizelos told reporters after party leaders met the head of state.

EU officials are hoping Hollande's election will revive proposals for solutions to the debt crisis such as issuing joint eurozone bonds, which Merkel has so far blocked.

Her relationship with Hollande, which one French pundit has already dubbed "Homer" perhaps due to its Greek challenge, may initially be cool as they are from opposing political families.

China's local governments roll out new property policies

Wed, 16 May 2012 04:00:00 GMT

China's real estate market is entering a crucial period as cities across the country introduce new property policies, while the troubled sector's sensitivity to policy changes increases, reports the Chinese-language Securities Times.

Yangzhou, a city in Jiangsu province, recently introduced a policy that rewards home buyers who purchase finished residences. The city was questioned after the May 7 announcement of its purchase incentive policy, as many thought the local government was encouraging home purchases in order to save the struggling property market. The city government, for its part, insisted that the policy was aimed at promoting the construction of finished houses and preventing resources from being wasted.

An industry insider, however, said that the goal of Yangzhou's policy is to help property developers stay afloat under the pretext of promoting project completion.

Cao Qu, an analyst with Shihua Property Investment, said the policy is designed to subsidize purchases of finished homes and is in line with the country's national policy, which has been aiming to limit speculation by curbing housing purchases. Yet the policy does not restrict subsidies to first-time house buyers, which appears to be a direct challenge to the central government's strategy. After Yangzhou introduced the incentive, rumors surfaced saying the government planned to cancel it.

The many complications met during the introduction of the policy showed the local government's hesitation in revising its property policies.

Since August 2011, 33 cities across China have introduced new policies targeting the housing market. Among them, policies in 28 cities have been approved, while those in the remaining five were called off. Despite these efforts, prices have not yet fallen to "reasonable" levels, the Securities Times report said.

Market expert Long Bin said the current round of home purchase tightening is aimed at driving prices down and enabling healthy, stable and sustainable market development. The newspaper said home purchase policies were revised to maintain economic growth.

Yet Long said that since this round of core policies had not been rolled back, the overall tightening policy remains unchanged. "Allowing local governments to revise their property policies is aimed at reducing the negative effects of the tightening housing policy," he said.

Asia still to be the world's highest growth region: UN

Wed, 16 May 2012 03:58:00 GMT

The Asia-Pacific will this year again be the world's best region in terms of economic growth, though it will expand more slowly than last year, according to a report by the United Nations Economic and Social Commission for Asia and the Pacific. The Chinese economy will grow 8.6% this year, the report said.

The commission said that growth in the Asia-Pacific will fall to 6.5% in 2012, from 7.0% in 2011. But the move will help the inflation rate in the region drop to 4.8%, compared to the more threatening 6.1% in 2010.

Asian exports will be affected by the European debt crisis and uncertainty in the United States. The high cost of financing and expanding monetary policy in some developed countries will also worsen the region's prospects, according to the report.

The commission emphasized an increase in commodity prices as short- and middle-term challenges for the region. High and possible unstable commodity prices will be common problems faced by the global economy in the future, the UN report said.

The European debt crisis and the high price of commodities, such as crude oil, will hamper the growth of economies in the region, including China. The two causes are expected to reduce China's GDP by 1.5% and 0.65%, respectively, this year, said the report.

FDI in China falls for sixth month

Wed, 16 May 2012 03:58:00 GMT

Foreign direct investment in China fell for a sixth-straight month in April amid global economic woes. Year-on-year, FDI edged down 0.74% to US$8.4 billion in April, following a 6.1% drop in March, 0.9% decline in February and 0.3% fall in January, the Ministry of Commerce said Tuesday.

The country received US$37.88 billion of FDI in the first four months, down 2.38% from a year earlier, ministry spokesman Shen Danyang said.

The ministry is "prudently optimistic" about the outlook for foreign investment, which had dropped because of both the lackluster global economy and rising costs within China, said Shen.

"China's investment environment is improving, not the other way round," he added.

He also said he was neutral on foreign trade, saying that the country was likely to post a slightly smaller trade surplus this year than last.

Investment from the debt-ridden European Union plunged 27.9% in the January-April period from a year ago. However, that from the United States and Japan climbed 1.9% and 16%, respectively, Shen said.

The continuous falls in FDI inflows were mainly because the deepening debt crisis has forced EU enterprises to cut overseas investment, said Li Huiyong, chief economist with Shenyin and Wanguo Securities.

Economic uncertainties within China because of its economic adjustment have also shaken investors' confidence, Li said.

China's economy expanded 8.1% in the first quarter from one year earlier, the least in almost three years. The country's central bank announced Saturday that it would cut banks' reserve requirement ratio by 0.5%, effective May 18, to spur lending and stabilize growth.

The continuous FDI declines are normal as the country changes its foreign investment policy from the pursuit of quantity to quality, said Teng Tai, economist of China Minzu Securities.

China approved the establishment of 7,016 foreign-invested companies in the first four months, down 13.94% from a year ago.

However, as investment into China drops, the country's outbound investment has surged. The country's nonfinancial overseas direct investment totaled US$23.16 billion in the first four months, up 72.8% from a year earlier.

Evernote's entry into China driven by local partnerships

Wed, 16 May 2012 03:55:00 GMT

Evernote, a cloud-based note-taking software provider, is making aggressive forays into China through collaboration with Chinese mobile-browser manufacturer UC Mobile and investments from China Broadband Capital (CBC Capital). At the TechCrunch Disrupt conference at the end of 2011, Evernote CEO Phil Libin was an unknown speaker. Yet within months he would become a highly sought-after interviewee for the media at the 2012 Global Mobile Internet Conference on April 10.

On May 10, Evernote launched a new, separate Chinese service called Yinxiang Biji and entered a global strategic cooperation deal with UC Mobile. Yinxiang Biji means Memory Notes or Impression Notes in Chinese.

"Currently, UC Mobile is our first cooperative partner in China for browser production. In the future, we will consider cooperating with other manufacturers in China," said Andrew Sinkov, vice president of marketing at Evernote.

Before that, Evernote announced on May 7 that it would accept US$70 million in investments from CBC Capital.

The 21st Century Business Herald in Guangzhou reported that compared with its predecessors Google and Yahoo, Evernote has a better understanding of China. "In China, we will choose a more capable cooperative partner," said Phil Libin.

In addition to Yinxiang Biji, a dedicated cloud-based notebook service for China, Evernote launched the Chinese editions of three core applications: Yinxiang Biji, Skitch and Evernote hello.

Yinxiang Biji is a fully-funded company of Evernote and CBC only has a limited stake in its parent company Evernote.

Evernote has seven employees in China and plans to expand its staff to 20-30 by the end of this year after the expansion of its businesses in China. The company also plans to set up an independent data center to allow Chinese software developers to write plug-ins.

"Only globalized companies will be successful in the mobile internet industry. China needs to go abroad, while foreign companies need to enter China," Phil Libin said, adding that cooperating with Chinese manufacturers was a good way for international companies to make inroads into China.

The newspaper reported that Evernote and UC Mobile would cooperate through resources exchanges.

The US.market is new to UC Mobile, just as China is new to Evernote. Cooperating with China's largest mobile-browser makers could help Evernote obtain new users. Evernote vice president Ken Gullicksen told the reporter that his company needed the help of local partners to venture into the Chinese market.

In addition to UC Mobile, Evernote has two other investors — CBC Capital and Meritech Capital.

China to boost construction of green buildings

Mon, 07 May 2012 01:21:00 GMT

BEIJING, May 6 (Xinhua) -- The Chinese government has established a goal of having green buildings account for 30 percent of new construction projects by 2020, according to an official document released Sunday. The document, which was jointly released by the Ministry of Finance and the Ministry of Housing and Urban-Rural Development, marks the first time for China to set a goal for the development of green buildings.

The move underlines China's intent to speed up the development of energy-efficient construction following other documents published earlier this year aimed at the same goal.

According to the document, the government will speed up the sector's development by increasing policy incentives and improving industry standards, as well as promoting technological progress and the development of related industries.

The document also specifies a goal of bringing China's building energy consumption ratio closer to that of developed countries by 2020.

Different from ordinary buildings, green buildings require construction projects to save as much energy, land, water and materials as possible throughout their life cycle to protect the environment and reduce pollution, according to an evaluation standard for green buildings released by the Chinese government in 2006.

Analysts said the move indicates that the "green construction" sector will be an economic breakthrough in terms of spurring growth and play a large role in the country's energy-saving efforts.

It will leverage a green market with trillions of yuan, as developing green buildings will effectively drive the growth of new building materials, new energy and related service sectors, said Zhang Shaochun, deputy minister of the Ministry of Finance.

The property sector possesses a strong ability to boost downstream industries. It is responsible for 50 percent of the country's steel consumption and 60 percent of cement consumption, Zhang said.

China's construction sector is estimated to account for more than 30 percent of total social energy consumption by 2020, becoming a major energy user.

But energy consumption can be effectively lowered by constructing green buildings. A preliminary study showed that an amount of energy equal to 45 million tonnes of standard coal can be saved by building energy-efficient buildings during the 2011-2015 period, according to Zhang.

"The document indicates that the country's green construction sector is moving into a fast development phase, and shows the government's resolve to speed up energy-saving and emission-reduction efforts," said Wang Youwei, deputy head of the China Association of Building Energy Efficiency.

Wang said the room for developing energy-efficient buildings is huge, as the total combined floor area of China's existing energy-efficient buildings amounts to less than 40 million square meters.

The construction of energy-efficient buildings will be subsidized according to a three-tier grading system specified in the 2006 evaluation standard, the document said.

First-tier buildings will make their builders eligible a subsidy of 80 yuan (about 12 U.S. dollars) per square meter, while second-tier buildings will qualify for 45 yuan per square meter.

The document also aimed to apply green construction standards to all government-funded public welfare projects and the low-income housing projects by 2014.

The document said more of these projects will be energy-efficient, with the goal of building more than 1 billion square meters of energy-efficient floor space by 2015.

The government will take concrete measures to strengthen fiscal support and prioritize funding to encourage the construction of green buildings in those projects, Zhang said.

China provides dictionaries for rural students

Mon, 07 May 2012 01:18:00 GMT

BEIJING, May 6 (Xinhua) -- China's General Administration of Press and Publication has urged further efforts to ensure the accessibility of dictionaries for the students in the country's rural and less-developed areas.

The administration's appeal came after earlier media reports that primary and secondary school students in rural areas in south China's Guangxi Zhuang autonomous region are in bad need of authoritative Chinese language dictionaries.

Bookstores nationwide should cooperate with the publisher of the most authoritative Chinese dictionary "Xinhua Dictionary," or "New China Dictionary," in distribution, in order to ensure the timely supply of the dictionary at its bottom price, the administration said in a statement.

The statement also encouraged press and publication administrative agencies to donate dictionaries and other basic reference books for the rural students.

Moreover, the statement urged to step up the crackdown on piracy of dictionaries and reference books.

According to the statement, more than 215,000 copies of "Xinhua Dictionary" are now available in the 200,000 rural reading rooms set up last year across the country.

Falling costs prompt China to cut solar projects grant by over 20 per cent

Mon, 07 May 2012 01:13:00 GMT

CHINA has cut a subsidy for solar projects under a demonstration program this year by more than 20 percent to reflect falling costs of photovoltaic system installations.

The government will offer 5.50 yuan (87 US cents) per watt for the combined capacity of 1.71 gigawatts approved for this year under the Golden Sun program, according to a statement on the central government's website yesterday. It earlier proposed to offer 7 yuan per watt this year.

"This is a bit surprising," said Liu Wenping, an analyst at investment research firm Pacific Epoch. "The lower subsidy may reflect that developers had been very enthusiastic in applying for projects while the government's total subsidy was already set."

Engineering, procurement and construction contractors typically ask for 8 yuan to 10.50 yuan per watt for solar projects today, Liu said.

Governments globally are slashing benefits enjoyed by solar installers as panel prices fall because of slowing demand in traditional markets like Europe.

Golden Sun was launched in 2009 to facilitate the development of China's solar power industry and aims to cover 50-70 percent of the investment in solar installations. Developers must meet certain requirements in capacity, scale and capital to qualify for the subsidy.

Meanwhile, Cao Min, chief financial officer of Nasdaq-listed JA Solar Holdings, yesterday said the solar industry may see improved prospects in the second half of 2012 or the first half of next year due to industry consolidation and improving demand.

JA Solar signed a strategic R&D tie-up yesterday with the Shanghai Institute of Technical Physics of the Chinese Academy of Sciences.

January, the National Energy Administration said China plans to double its solar power capacity in operation by installing 3 gigawatts this year.

National Australia Bank to slash 1,400 jobs in Britain

Mon, 07 May 2012 01:10:00 GMT

NATIONAL Australia Bank today said it plans to restructure its struggling British business, slashing more than 1,400 jobs at the loss-making arm by 2015. The announcement came as Australia's fourth biggest bank said its unaudited first-half net profit fell to Aus$2.05 billion (US$2.14 billion) in the six months to March 31, 15.6 percent below the previous corresponding period.

The result came after the lender booked writedowns and restructuring charges at its British division worth a combined 456 million pounds (US$742 million).

NAB said it had completed a strategic review of its British assets to adapt to weak economic conditions, with the business to be simplified to focus on retail and small business lending in Scotland and northern England.

Chief executive Cameron Clyne said the review was undertaken because recovery in the region was now considered a longer-term prospect.

"In the last half-year there has been a significant downgrade in the growth prospects of the UK economy, in part reflecting the drag on its recovery from heightened weakness in the eurozone," he said.

"In addition, the commercial property market, which had previously seen signs of recovery, has recently experienced a 'double dip' as the recovery stalls and other banks accelerate the reduction in their commercial real estate exposures.

"This has contributed to the current downturn in the UK being longer and slower to recover than experienced in the 1930s following the Great Depression, and has led us to take these actions at this time."

The bank said it would result in at least 1,400 jobs being lost by the end of the 2015 financial year.

"While every effort will be made to support our people, the substantive repositioning of the business will impact roles in the UK," Clyne said.

The moves are expected to see annual cost savings of about Aus$116 million by 2015, it said.--AFP

Chinese can swipe UnionPay cards in Czech

Mon, 07 May 2012 01:04:00 GMT

CHINA UnionPay, the country's sole bank card transaction firm, has reached an agreement with Komerceni Banka (Czech Commercial Bank) to allow its card holders to withdraw Czech currency from nearly 700 automatic teller machines the bank operates.

Overseas UnionPay cardholders will be able to withdraw local currency and swipe debit cards or credit cards according to the real-time exchange rate, saving up to 2 percent conversion fees out of overall transaction amount.

Czech Commercial Bank is one of the major banks in the Czech Republic with the largest transaction volume and nearly 400 branches across the country.

Czech merchants began to accept UnionPay cards in 2010 and their number has been expanding since then.