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Saudi to draw Western-style entertainment

Thu, 02/22/2018 - 17:01
SAUDI Arabia announced plans yesterday to spend billions on building new venues and flying in Western acts, in a total overhaul of its entertainment sector that would have been unthinkable not long ago. Long known for its ultra-conservative mores, the kingdom has embarked on a wide-ranging program of social and economic reforms driven by Crown Prince Mohammed bin Salman. At a glitzy press conference in Riyadh, General Entertainment Authority chief Ahmad bin Aqeel al-Khatib said the kingdom is set to invest US$64 billion in its entertainment sector over the coming decade. “We are already building the infrastructure,” Khatib said, adding that ground had been broken for an opera house. Khatib said hundreds of new companies have sprung up over the past year, registering for licences to take advantage of the budding sector. “God willing, you will see a real change by 2020,” Khatib said, adding that more than 5,000 events were planned for the coming year. The funding for new infrastructure and entertainment offerings will come from both the government and the private sector, he said. Behind Khatib, a screen teased the names of international acts like Maroon 5, Andrea Bocelli and Cirque du Soleil. Neither a breakdown of how the money would be spent nor a schedule for the cultural program were provided. But it follows a series of events in recent months including concerts, a Comic-Con festival and a mixed-gender national day celebration that saw people dancing in the streets to thumping electronic music for the first time. Authorities have also announced plans to lift a decades-old ban on cinemas this year, with some 300 expected to open by 2030. Senior GEA official Faisal Bafrat said the past year had already seen exceptional development in the entertainment sector with more than 2,000 events involving 100,000 volunteers and 150 small and medium businesses organised in 2017. The newfound openness, which includes plans to allow women to drive from June this year, has been hailed by some as a crucial liberalization of Saudi society. Critics have pointed to continued restrictions however, especially on women who remain under a strict “guardianship” system that gives male relatives significant control over their lives. Yet even that could be changing. With the lifting of the driving ban on the horizon, Riyadh announced on Sunday that women can now open their own businesses without the consent of a husband or male relative. The reforms are part of Prince Mohammed’s ambitious “Vision 2030” program, which seeks to diversify the Saudi economy as it reels from a slump in energy prices, with the entertainment sector seen as a key potential source of growth. Saudis splurge billions annually on movies and visits to amusement parks in the neighboring tourist hubs of Dubai and Bahrain, which is accessible by a land causeway. Khatib vowed to turn around that trend. “I went to Bahrain. The bridge is being reversed,” he said, adding that Bahraini nationals were now coming to Saudi Arabia for events — accounting for 10 percent of ticket sales in recent months. The goal to keep Saudis — more than half of whom are under 25 — spending their disposable income at home is part of a wider campaign called “Don’t travel.” Saudi Arabia, the world’s top oil exporter, has been struggling to cope with persistent budget deficits that began in 2014 when crude prices plummeted.

Walmart to try online home shopping

Thu, 02/22/2018 - 17:01
BOHEMIAN or traditional? Walmart is launching a new online home shopping experience in the coming weeks that will let shoppers discover items based on their style. The move, announced yesterday, is the first glimpse of the company’s broader campaign to redesign its site with a focus on fashion and home furnishings. The overhauled website will be launched later this year and will mirror how people shop for different items. While some purchases like groceries are transactional, others like fashion and home furnishings require more discovery. Later this spring, Walmart is rolling out its new Lord & Taylor dedicated page as part of its partnership with the department store chain’s parent company Hudson’s Bay. Walmart’s home shopping site will include curated collections and nine shop-by-style options including modern, traditional and bohemian. It will offer design tips that will help shoppers pull items together. “With this launch, we’re making it faster, easier and more inspiring for customers to discover the best of our assortment no matter their personal style,” said Anthony Soohoo, senior vice president and general manager of home for Walmart’s e-commerce division. The move comes as Walmart, with its eye on Amazon.com, has been working to ramp up its e-commerce business, which still accounts for below 4 percent of its total sales. It’s overhauled its shipping strategy and expanded the number of items online to 75 million. In home furnishings, it doubled the number of products online from a year ago and introduced a new Scandinavian collection of furniture for children. But Walmart faces stiff competition in the home arena not only from Amazon but home shopping sites like Wayfair. Amazon has been growing its home offerings. It sells its own exclusive brands of furniture, sheets and other home goods. It signed a deal with Ethan Allen last year to sell its sofas, lamps and rugs, and Amazon shoppers can ask Ethan Allen experts for design advice. Boston-based Wayfair is the largest online-only furniture retailer.

US jobless claims drop to 45-year low

Thu, 02/22/2018 - 17:01
THE number of Americans filing for unemployment benefits fell to a near 45-year low last week, pointing to strong job growth in February, which should continue to underpin the economy. Initial claims for state jobless benefits fell 7,000 to a seasonally adjusted 222,000 for the week ended February 17, the Labor Department said yesterday. Claims fell to 216,000 in mid-January, which was the lowest level since January 1973. Claims for six states, including California, were estimated because of Monday’s Presidents Day holiday. While that probably distorted last week’s data, the underlying trend in claims was consistent with a robust labor market. “Firms are extraordinarily unwilling to part company with workers reflecting, in all likelihood, the difficulty of replacing them,” said John Ryding, chief economist at RDQ Economics in New York. Economists polled by Reuters had forecast claims flat at 230,000 in the latest week. It was the 155th straight week that claims remained below the 300,000 threshold, which is linked with a strong labor market. That is the longest such stretch since 1970, when the labor market was much smaller. The labor market is near full employment, with the jobless rate at a 17-year low of 4.1 percent. Tightening labor market conditions are starting to push up wage growth, which could help to lift inflation toward the Federal Reserve 2 percent target. Minutes of the US central bank’s January 30-31 policy meeting published on Wednesday showed policymakers upbeat in their assessment of the economy and a number “judged that the continued tightening in labor markets was likely to translate into faster wage increases at some point.”

Slowing growth in M2 to be the norm

Thu, 02/22/2018 - 17:01
China’s financial market should become more accustomed to a slowing M2 growth and pay more attention to how the central bank uses interest rates on open market operations, the Bank of Communications said in its review of the central bank’s latest quarterly monetary report.The outstanding M2, the broad measure of money supply, totaled 167.7 trillion yuan (US$26.4 trillion) as of the end of 2017, up 8.2 percent year on year. The growth rate slowed by 3.1 percentage points compared with 12 months ago, according to the latest report released by the People’s Bank of China.The drop was attributed to banks’ declining equity and other investments, slowing bond investments and a bigger-than-expected growth of fiscal deposits, said the Chinese central bank.The report argues that as China is transforming its economic structure, there are changes in the correlation between M2 and economic growth. E Yongjian, chief financial analyst, and Qiu Gaoqing, chief researcher at BoCom, believe the PBOC will not change its stance of maintaining prudent monetary policy this year due to a slowing M2 growth.Therefore, the market should become more accustomed to this. They noted that M2 remains an important variable to observe the relationship between finance and the real economy, and the market needs to pay more attention to the changes in interest rates on open market operations.The report emphasized the PBOC will make better manage liquidity and BoCom said that “neutral and moderate” liquidity will be the central bank’s main target.

Fosun buys Lanvin and pledges to revive fortunes

Thu, 02/22/2018 - 17:01
CHINESE conglomerate Fosun snapped up the ailing French fashion label Lanvin yesterday and promised to revive its fortunes. Lanvin, the oldest French luxury house still in existence, has been in turmoil since the shock sacking of popular designer Alber Elbaz two years ago. It sank into the red to the tune of 18.3 million euros (US$21.2 million) in 2016, its first loss for a decade. Its previous owner, Taiwanese media magnate Shaw-Lan Wang, who had promised a fresh cash injection, remains a shareholder, Fosun said in a statement. “Not all brands can go through more than a century and still shine like Lanvin,” said Fosun International’s chairman Guo Guangchang, who is often called China’s Warren Buffett after the American investor and darling of the markets. “This globally renowned brand and its rich history has tremendous growth potential,” he added. “As China becomes the main growth driver of the global luxury market, we are confident that Fosun can bring great incremental value to Lanvin,” the statement added. Fosun, which already owns the French holiday company Club Med and a string of mid-market fashion brands including German label Tom Tailor, said it was “absolutely committed to Lanvin’s high luxury positioning and its exceptional quality of products manufactured in France and Italy.” Fosun gave no financial details of the transaction. It said current shareholders would retain a minority stake in Lanvin. Fosun will invest around 100 million euros in the business, a source close to the matter said. Lanvin’s artistic director Olivier Lapidus — who replaced designer Bouchra Jarrar in July after only 10 months at the helm — said in November that he was helping to prepare a major shift for the brand, which was founded in 1889. Before Fosun took a controlling stake, Madame Wang held 75 percent of the company, with the rest of the shares owned by German businessman Ralph Batel. Fosun has gone a huge foreign buying spree since 2013, splashing out US$13 billion on a eclectic range of companies from entertainment to tourism and banking, according to analyst platform Dealogic. It also has major stakes in the “Cirque du Soleil” performance group, British travel agent Thomas Cook, jeweler Faberge and Indian pharmaceutical company, Gland Pharma. Fosun beat Qatari investment fund Mayhoola, owner of Italy’s Valentino, to buy Lanvin, sources had previously said.

Shanghai cuts red tape for approval

Thu, 02/22/2018 - 17:01
SHANGHAI plans to drastically shorten the time to scrutinize non-state investment projects from the current 105 working days to between 15 and 48 working days as it bids to improve the approval process. The city government’s new reform to examine non-state investment projects to make it more efficient and improve the business environment will take effect from March 1. The time taken to scrutinize non-state investment projects will be greatly shortened from the current 105 working days for all categories. The maximum time taken to approve various projects will be set at 15, 35 and 48 working days respectively for industrial projects, small-scale projects and other non-state projects. The reform will also cut from seven to three the number of departments involved in approving the project design. The reform also emphasizes strengthening supervision over on-going projects and also after they are completed. Shanghai will also promote one-stop online and offline services to help companies fully understand the requirements, related policies and application processes. The World Bank’s “Doing Business” report for 2018 says Shanghai’s approval of construction permits covers 23 stages and takes 279 days. China, meanwhile, is ranked 172nd in the report, which represents a large gap with some developed economies such as Singapore.

Chinese stocks rise after break

Thu, 02/22/2018 - 17:01
CHINESE stocks surged yesterday, the first trading day after the weeklong Lunar New Year holiday. The Shanghai Composite Index rose 2.17 percent to close at 3,268.56 points, while the smaller Shenzhen Component Index ended 2.18 percent higher at 10,658.94 points. The ChiNext Index, which tracks China’s NASDAQ-style board of growth enterprises, gained 1.88 percent to 1,677.77 points. Combined turnover on the two bourses grew to 325.8 billion yuan (US$51.3 billion) from 236.9 billion yuan the previous trading day. Nonferrous metals, food and beverage, as well as leisure sectors led the sharp gains, with over 40 stocks up the 10-percent daily limit. Sales in the retail and catering sectors reached 926 billion yuan during the holiday, up 10.2 percent from last year, the Ministry of Commerce said on Wednesday. Chinese consumption habits during the holiday were likely to boost apparel and household appliances sectors, said Guotai Junan Securities.

Card usage up during holiday

Thu, 02/22/2018 - 17:01
CHINA UnionPay, the country’s sole bank card network operator, said yesterday that transactions surged to a record high during the weeklong Spring Festival holiday as card holders went on a spending spree. The total value of transactions at home and abroad through China UnionPay network soared 47 percent from last year’s holiday to 679 billion yuan (US$107 billion), according to a China UnionPay statement. Card owners’ spending on shopping and catering jumped 43 percent and nearly 50 percent, respectively, while that for entertainment and cultural activities also surged. Overseas transactions grew, with payments in Turkey, Morocco and Sri Lanka more than double those of last year’s holiday. Mobile payments via China UnionPay services soared nearly 150 percent overseas, the operator said.

Both sales and tourism up over 10% for holiday

Wed, 02/21/2018 - 17:01
SHOPS and restaurants across China reported robust sales during the weeklong Chinese Lunar New Year holiday, data from the Ministry of Commerce showed yesterday. Sales in the retail and catering sectors reached 926 billion yuan (US$146 billion) during the week, up 10.2 percent from last year’s holiday, the ministry said. Sales of traditional festival-related goods, organic food, jewelry, apparel, household appliances and digital products maintained rapid growth. Major organic food producers in Jiangxi, Qinghai and Shandong provinces saw double-digit sales growth, while major jewelry stores in Shaanxi and Guizhou provinces reported sales increases of 43 percent and 30.6 percent respectively, compared with last year’s holiday. Dog-themed accessories were most favored by consumers as this year is the Year of the Dog in the 12-animal Chinese zodiac. In the catering market, family dinners on the Chinese New Year’s Eve were almost fully booked at some restaurants, and numerous restaurants worked with online platforms to offer delivered dinners or home cooking services. Consumption in culture and entertainment was also strong, with China’s box office raking in 4.6 billion yuan over the February 16-20 period, up nearly 60 percent from the first six days of last year’s Spring Festival. China, meanwhile, posted a double-digit growth in tourism revenue during the weeklong holiday. Official data showed yesterday that the tourism industry garnered 475 billion yuan in revenue, up 12.6 percent from last year’s holiday, according to the China National Tourism Administration. Some 386 million trips by tourists were made, up 12.1 percent from last year’s holiday, the tourism administration said. Guangdong, Sichuan and Hunan received the most tourists among all provincial regions. Nearly half of travelers drove instead of taking public transport. Overseas travel remained popular, with Chinese tourists from nearly 200 cities visiting 68 countries and regions during the holiday. Southeast Asia was the top destination, while long-distance tours to countries including Argentina and Mexico were also popular. Nearly half of overseas travels were independent tours rather than escorted group tours, the tourism administration cited data from online tour operator Ctrip.com as saying. The Chinese Lunar New Year, which this year began last Friday, is traditionally a time for family gatherings in China. In recent years, family travels have become increasingly common that help to drive a tourism boom across the country. China earned 5.4 trillion yuan from tourism in 2017, an increase of 15.1 percent. The country plans to raise tourism revenue to 7 trillion yuan by 2020 in a bid to develop tourism into a major driver of economic transformation and upgrading.

Steel mills set to roar after curbs end

Wed, 02/21/2018 - 17:01
CHINA’S steel producers are eager to unleash their mills’ capacity when this winter’s output curbs end next month. They are hoping for a repeat of last year’s record profits based on high margins and less competition after outdated plants were closed. China shut down up to half of its steel production this winter in 28 cities in the country’s manufacturing heartland in the north as part of an anti-pollution campaign. With margins still encouraging full output, China’s pent-up steel production should erupt when the curbs expire on March 15. Because of the curbs, China’s average daily steel output in December was the lowest in a year at 2.16 million tons, government data showed last month. Average daily output could rise to about 2.5 million tons if the mills quickly boost production when restrictions are lifted, Wang Yingsheng, vice secretary-general of the China Iron and Steel Association said recently. With the government likely to reimpose the limits next winter, northern Chinese mills will have only about eight months to run at full speed, so plants are stocking up on raw materials to maximize production while the market conditions remain strong. “I think there could be restrictions again on mills in north China this year and they could increase output before the restrictions,” said a senior manager at a steel mill in south China. “If the market’s good, every mill will try to run at full capacity in order to make more profit.” Thanks to China’s infrastructure push that sustained steel demand even as the environmental crackdown cut supplies, mills are set to report massive profit gains. Xinjiang Ba Yi Iron & Steel in northwest China said 2017 net profit might have risen by 3,000 percent and Anyang Iron & Steel, based in Henan province, could show last year’s profit up 1,300 percent, according to preliminary estimates by the companies. Last month, Jiujiang Steel in Jiangxi Province rewarded workers with 278 million yuan (US$44 million) in 2017 bonuses. The cash weighed 3.5 tons and was delivered by four vans to staff at its main office, according to a company official and photos on Jiujiang Steel’s WeChat account. Profit margins have retreated from last year’s peaks, but are still more than enough to motivate maximum production, said the southern mill manager. Chinese steel margins for rebar this year are averaging 866 yuan a ton, according to data from brokerage CLSA. While down from last year’s average of 922 yuan, rebar margins are well above the five-year average of 251 yuan. Hot-rolled coil margins are averaging 865 yuan this year versus a five-year average of 259 yuan. To prepare for the output ramp-up, steel producers have raised their iron ore stockpiles to 34 days of consumption as of early January, according to consultants Mysteel, almost matching the all-time high of 35 days a year ago. Even with the bulging inventories, mills are adding more. China imported 100 million tons of iron ore last month, the second-highest on record, even as stockpiles at ports are at 153 million tons, near the record reached in January of 154.4 million. Soon after China announced the winter controls in February last year, mills increased production ahead of the curbs, hitting a series of output records over the next several months. The situation will likely repeat itself this year as mills expect another round of restrictions next winter. “Mills will be more prepared this year and they will just bring forward their production plans if they know there will be supply restrictions again,” said Richard Lu, analyst at consultants CRU. One possible drag on the expected surge in Chinese output may occur in Tangshan, the country’s largest steel-producing city. Officials there have said they will continue some curbs beyond the March expiry, including at eight mills located near the city center.

Soaring business is made from scrap too

Wed, 02/21/2018 - 17:01
CHINA’S scrap steel exports soared last year as domestic demand was dampened, according to data from an industry association. The country exported 2.2 million tons of scrap steel last year, compared with just around a meager 1,000 tons in 2016, according to figures supplied by the China Iron and Steel Association. The surge came despite a 40 percent tariff on scrap steel exports as millions of tons of such steel was kept out of the domestic market due to a ban on the production of ditiaogang, or steel made from scrap metal. Most exports went to Southeast Asian nations. The biggest sources of exports were eastern and southern coastal provinces including Guangdong, Jiangsu, Zhejiang, Fujian and Hainan. China phased out the production of 140 million tons of ditiaogang last year as part of efforts to reduce excessive capacity in the steel sector.

Huawei and Vodafone in first 5G call

Wed, 02/21/2018 - 17:01
CHINESE telecommunications giant Huawei and British multinational network provider Vodafone announced on Tuesday they had completed the first 5G call in the world. In a press communique, Huawei confirmed the call was made using a dual “4G to 5G connection” at speeds which are eight times faster than the current 4G standard. Huawei also said a second test “using a 5G data connection” for a video call was also successfully carried out. The call was made from the town of Castelldefels, close to Barcelona, to Madrid using the 3.7 GHz bandwidth which will be incorporated in the future rollout of 5G technology. “Huawei is totally committed to the development of the technology of the 5G network and today’s test shows the maturity of 5G development on the standards approved by the 3GPP,” said Yang Chaobin, the president of Huawei’s 5G product line. He added that Huawei was now prepared to “advance” in its collaboration with Vodafone to “start commercial trials.” The CEO of Vodafone Spain Antonio Coimbra said the first 5G connection in Spain was of “great relevance for the digital transformation” of the country.

UK jobless rises to 4.4% over Brexit

Wed, 02/21/2018 - 17:01
BRITAIN’S unemployment rate has risen for the first time in 16 months, official data showed yesterday, in a sign that Brexit uncertainty is feeding into the wider economy. The jobless rate, or the proportion of the workforce that is unemployed, stood at 4.4 percent in the three months to the end of December, the Office for National Statistics said in a statement. That was up from 4.3 percent in the quarter to November 2017, which had been the lowest level in 42 years. Analysts said that yesterday’s data reduced the likelihood that the Bank of England would raise its main interest rate in May, as had been widely expected by markets. Prior to the data, markets had widely expected the Bank of England to raise its key lending rate in May, by a quarter-point to 0.75 percent, following a small hike last year.

Share curbs for insurance sector

Wed, 02/21/2018 - 17:01
RISK control will remain a priority in China’s insurance sector with planned measures like limiting the share ownership of single share owners, a top official from the China Insurance Regulatory Commission said yesterday. Each share owner will no longer be allowed to hold more than one third of shares in an insurance firm, down from the previous 51 percent, to prevent a single party enjoying too much power in making investment decisions, Chen Wenhui, vice chairman of the CIRC told the People’s Daily yesterday. The commission will also study the feasibility of creating a “black list” for professional managers in the sector. It will establish a multi-level prevention system to cope with deep-rooted malpractices such as offering misleading information in sales, making claims difficult and cheating for compensations. “Preventing systemic financial risk is the eternal theme of financial work,” Chen said. “As an industry to control risks and decentralize them, insurance itself should pay more attention to risk management and develop more steadily.” The industry has played an active role in serving economic and social development. It has provided an accumulated 1.6 trillion yuan (US$252.58 billion) of risk insurance to 180 million agricultural households, and 1.01 billion people have been covered by critical illness insurance. Through investments in bonds and stocks, the insurance funds have directly raised over 7 trillion yuan for the real economy, and has supported the Belt and Road construction with 772 billion yuan in the form of debt investment plan and stock ownership plan. “CIRC will promote the insurance industry to play a long-term risk management and security function, thus better serving the development of real economy,” Chen said. Multinational insurance companies have set up 56 foreign-invested institutions in China, while China has established 37 insurance business institutions abroad with two of them becoming the world’s top 10 insurance companies. China has already announced that it plans to open up the sector for foreign investment. “In the next step, we will also push for more open policies in the free trade zones and reform pilot areas to encourage foreign investment in the insurance sectors such as health care and pension fund,” Chen said. He said that by increasing supervision and opening up in an orderly manner, China would gradually grow in the international insurance sector.

Cybercrime cost rises to US$600b globally

Wed, 02/21/2018 - 17:01
THE annual cost of cybercrime has hit US$600 billion worldwide, fueled by growing sophistication of hackers and proliferation of criminal marketplaces and cryptocurrencies, researchers said yesterday. A report produced by the security firm McAfee with the US-based Center for Strategic and International Studies found theft of intellectual property represents about one-fourth of the cost of cybercrime in 2017. The researchers said ransomware is the fastest-growing component of cybercrime, helped by the easy availability of marketplaces offering hacking services. The global research report comes days after the White House released a report showing cyberattacks cost the United States between US$57 billion and US$109 billion in 2016, while warning of a “spillover” effect for the broader economy if certain sectors are hit. Globally, criminals are using the same tools for data or identity theft, bank hacks, and other cyber mischief, with anonymity preserved by using bitcoin or other cryptocurrency. “The digital world has transformed almost every aspect of our lives, including risk and crime, so that crime is more efficient, less risky, more profitable and has never been easier to execute,” said Steve Grobman, chief technology officer for McAfee. The study did not attempt to measure the cost of all malicious activity on the Internet, but focused on the loss of proprietary business data, online fraud and financial crimes, manipulation directed toward publicly traded companies, cyber insurance and reputational damage.

Broadcom cuts offer for Qualcomm

Wed, 02/21/2018 - 17:01
BROADCOM Corp yesterday fired its latest salvo against Qualcomm Inc by lowering its takeover offer to US$117 billion from US$121 billion, a day after the US chipmaker increased its own offer for NXP Semiconductors NV. Broadcom’s previous US$82 per share offer for Qualcomm was contingent on it buying NXP at its earlier offered price of US$110 per share. Broadcom said it had cut its offer to US$79 per share due to Qualcomm’s increase of its price for NXP to US$127.50 per share, but would revert to US$82 per share if Qualcomm was unable to complete the NXP deal. Under the new terms, Broadcom will offer Qualcomm shareholders US$57 per share in cash and US$22 per share in Broadcom shares. Broadcom said other conditions of the proposed merger agreement remained unchanged, including an US$8 billion regulatory reverse termination fee.

Air France strike to hit foreign flights

Wed, 02/21/2018 - 17:01
HALF of Air France’s long-haul flights out of Paris today will be canceled due to a strike by pilots, cabin crew and ground staff, the carrier said. The airline said yesterday it expected to maintain 75 percent of its scheduled service but only 50 percent of its long-haul flights and advised travelers to postpone their trips until February 27 at no extra cost. The staff are demanding a 6 percent across-the-board pay increase. Management is offering a basic increase of 1 percent to be paid in two installments and a range of incentives, which trade unions have dismissed as “small change.” The Air France-KLM group posted a 42 percent increase in its operating profit to 1.49 billion euros (US$1.84 billion) in 2017.

4 maritime car transporters hit with fines

Wed, 02/21/2018 - 17:01
THE EU yesterday hit four maritime car transporters with a 395-million-euro (US$486 million) fine as well as slapping penalties on auto parts manufacturers including Germany’s Bosch and Continental. An investigation by the bloc found that Chilean carrier CSAV, Japan’s “K” Line, MOL and NYK, and the Norwegian-Swedish WWL-EUKOR had run a cartel over six years to fix prices and allocate customers in the market for the deep sea transport of cars, trucks and other vehicles. Bosch and Continental were among a group of companies fined for operating cartels in the supply of spark plugs and braking systems. “By raising component prices or transport costs for cars, the cartels ultimately hurt European consumers and adversely impacted the competitiveness of the European automotive sector, which employs around 12 million people in the EU,” EU Competition Commissioner Margrethe Vestager said. MOL revealed the existence of the transport agreement to the authorities and as a result escaped without a fine. In the spark plug cartel, Bosch was fined 46 million euros and Japan’s NGK 30 million euros for agreeing not to compete with each other for traditional customers, swapping sensitive information and fixing prices. Bosch and Continental, along with TRW of the United States, were also found to have colluded over the supply of braking systems to BMW and Volkswagen.

Crisis-hit Venezuela puts faith in cryptocurrency

Wed, 02/21/2018 - 17:01
VENEZUELA formally launched its new oil-backed cryptocurrency on Tuesday in an unconventional bid to haul itself out of a deepening economic crisis. The Caracas government put 38.4 million units of the world’s first state-backed digital currency, the Petro, on private pre-sale from the early hours. During the first 20 hours of the pre-sale, which runs through March 19, Venezuela received “intent to buy” offers to the tune of US$735 million, according to President Nicolas Maduro. “The Petro reinforces our independence and economic sovereignty and will allow us to fight the greed of foreign powers that try to suffocate Venezuelan families to seize our oil,” he said. A total of 100 million Petros will go on sale, with an initial value set at US$60, based on the price of a barrel of Venezuelan crude in mid-January — but subject to change. Economist and cryptocurrency expert Jean-Paul Leidenz said prices during the pre-sale “will be agreed privately,” and will then fluctuate according to the market when the initial coin offering of 44 million Petros is made on March 20. Meanwhile, the government will reserve the remaining 17.6 million Petros. Venezuela has the world’s largest proven oil reserves but is facing a crippling economic and political crisis. Vice President Tareck El Aissami said the Petro will “generate confidence and security in the national and international market.” Maduro announced in early December that Venezuela, which is under sanctions from the US as well as the EU, was creating the digital currency. The Venezuelan leader said he expects the Petro to open “new avenues of financing” in the face of Washington’s sanctions, which prohibit US citizens and companies from trading debt issued by the country and its oil company PDVSA. But experts are skeptical about the Petro’s chances of success, pointing out that the country’s deep economic imbalances will only serve to undermine confidence in the new currency. “Theoretically, with cryptocurrencies you could bypass the US financial system... but everything depends on generating confidence,” said economist Henkel Garcia. Consulting firm Eurasia Group estimates that although Venezuela could raise some US$2 billion in the initial offer, it is “unlikely” that the Petro will be established as “a credible means of exchange,” beyond short term “interest.” Venezuela is mired in a deep economic crisis triggered in large part by a fall in crude oil prices and a drop in oil production.

Imprisoned co-CEO of retail giant Lotte quits

Wed, 02/21/2018 - 17:01
ASIAN retail and chewing gum giant Lotte has accepted the resignation of its co-CEO after he was convicted of bribery and embezzlement in a wide-ranging corruption scandal that brought down South Korea’s president. The company said yesterday that Shin Dong-bin has left his CEO post at Lotte Holdings but will remain on its board as vice chairman. Shin, a son of Lotte’s founder, was convicted and imprisoned earlier this month. His Japanese co-CEO, Takayuki Tsukuda, will head the holding company at the heart of Lotte’s complicated ownership structure, Lotte Holdings said in an emailed statement. Japan typically adopts a tough stance toward convicted executives, who are usually sacked from chief executive positions when indicted by authorities. Lotte Holdings in Japan controls Hotel Lotte, which controls Lotte’s various South Korean businesses. Shin’s resignation will inevitably weaken ties between Lotte’s businesses in South Korea and in Japan, the company said. Sprawling business Before he was convicted and given a two-and-a-half year jail term earlier this month, Shin had sought to improve transparency and reform South Korea’s fifth-largest conglomerate. Founded by his father in Japan, Lotte is well-known across Asia with a sprawling business that encompasses retailing, confectionery, chemicals, hotels and entertainment. Shin’s imprisonment came as a shock to the South Korean business community and to Lotte itself. Just a week before a Seoul district court ordered him to be jailed, a Seoul appeals court released another business tycoon involved in the same scandal: Samsung Vice Chair Lee Jae-yong. He had spent nearly a year in prison on bribery and other charges but won a suspended sentence on appeal. Lee’s release fueled a public outcry and anger toward the perceived soft treatment of business elites by South Korea’s judiciary system. Many in Seoul had expected Shin would also avoid imprisonment because he appeared to be less deeply implicated in the case.

SK U-turn on virtual coin trade

Wed, 02/21/2018 - 17:01
A BETTER deal for South Korea’s cryptocurrency industry might be in the offing as the market regulator changes tack from its tough stance on the virtual coin trade, promising instead to help promote blockchain technology. The regulator said on Tuesday that it hopes to see South Korea, which has become a hub for cryptocurrency trade, normalize the virtual coin business in a self-regulatory environment. “The whole world is now framing the outline (for cryptocurrency) and therefore (the government) should rather work more on normalization than increasing regulation,” Choe Heung-sik, chief of South Korea’s Finance Supervisory Service (FSS), told reporters. The latest news suggests authorities might adopt a lighter regulatory touch, a step change from the justice minister’s warnings in January that the government was considering shutting down local cryptocurrency exchanges, throwing the market into turmoil. FSS has been leading the government’s regulation of cryptocurrency trading as part of a task force. Cryptocurrency operators see Choe’s comments as a positive step for the industry. “Though the government and the industry have not yet reached a full agreement, the fact that the regulator himself made clear the government’s stance on cooperation is a positive sign for the markets,” said Kim Haw-joon of the Korea Blockchain Association. South Korea banned the use of anonymous bank accounts for virtual coin trading as of January 30 to stop cryptocurrencies being used in money laundering and other crimes. Three local banks including Shinhan Bank, Industrial Bank of Korea, NH Bank, are currently offering cryptocurrency accounts to around five local virtual coin exchanges. An FSS official said tough regulatory oversight of illegal trade in cryptocurrencies will remain in place.

Plug battle is on for electric car supremacy

Wed, 02/21/2018 - 17:01
GERMAN carmakers hope a network of high-power charging stations they are rolling out with Ford will set an industry standard for plugs and protocols that will give them an edge over electric car rivals. At the moment, Tesla and carmakers in Japan and Germany use different plugs and communication protocols to link batteries to chargers, but firms building the charging networks needed for electric vehicles to become mainstream say the number of plug formats will need to be limited to keep costs down. Carmakers behind the winning technology will benefit from having an established supply chain and an extensive network, making their vehicles potentially more attractive to customers worried about embarking upon longer journeys, analysts say. Manufacturers that back losing plugs, however, could end up with redundant research and development and may have to invest to adapt assembly lines and vehicle designs so their customers can use the most widespread fast-charging networks. Swiss bank UBS has estimated that US$360 billion will need to be spent over the next eight years to build global charging infrastructure to keep pace with electric car sales, and it will be key to limit the numerous technologies now in use. “The quick-charging marketplace might be growing fast but the issue of different types of connectivity and communication will need to be resolved going forward,” UBS said in a study published this month. To try to build critical mass for the Combined Charging System (CCS) favored by Europe, BMW, Mercedes-Benz maker Daimler, Ford and the Volkswagen group, which includes Audi and Porsche, said in November they would develop 400 high-power charging stations on main roads in 18 European countries by 2020. “In the end, it is about safe-guarding investments for those that are investing in electric mobility,” said Claas Bracklo, head of electromobility at BMW and the chairman of the Charging Interface Initiative (CharIN), which is backing CCS. “We have founded CharIN to build a position of power.” It is still early days for electric cars and difficult to predict which plug technology will prevail or even whether there will always be different ways to charge vehicles, unlike the one-size-fits-all nozzle that can refill all petrol cars. But there is a lot at stake for the carmakers ploughing billions of dollars into the development of batteries and electric cars. Format wars Besides CCS, there are three other standards that will charge batteries fast: Tesla’s Supercharger system, CHAdeMO, or Charge de Move, developed by Japanese firms including carmakers Nissan and Mitsubishi, and GB/T in China, the world’s biggest electric car market. “I think over time CHAdeMO and CCS converge, likely into the current CCS standard, and the jury is out as to what will happen to Tesla,” said Pasquale Romano, chief executive officer of Silicon Valley-based ChargePoint, which runs one of the world’s largest charging station networks. So far, there are about 7,000 CCS charging points worldwide, according to CharIN, with more than half in Europe. The European Union backs CCS as the standard for fast-charging but does not prohibit other plugs being installed. That compares with 16,639 charge points compatible with CHAdeMO — most in Japan and Europe — and 8,496 Tesla Superchargers, with the majority in the United States. In China, there are 127,434 GB/T charging stations, according to the China Electric Vehicle Charging Infrastructure Promotion Alliance. Just as in previous format wars such as the battle for videotape dominance between VHS and Betamax, each charging standard has its pros and cons. Tesla’s system is exclusive to its clients, for example, while CCS features a double-plug that can charge direct current (DC) and alternate current (AC), increasing the number of spots where drivers can recharge. CHAdeMO, meanwhile, allows cars to sell power from their batteries back to the grid, a process known as bi-directional charging that can help stabilize energy networks in times of demand swings and earn car owners some extra cash. “If I were Nissan, I’d be wanting to take that standard and make it the dominant one,” said Gerard Reid, founder of Alexa Capital that advises companies in the energy, technology and power infrastructure sectors. “It creates a competitive advantage for them,” he said. Fast-chargers matter Most plugs used to charge cars at home use AC and are slow, so building networks that can power vehicles fast when on the road is seen as key by the industry, given many potential consumers still worry about battery range. Able to deliver more powerful, DC fast-chargers can load electric cars up to seven times faster. The fastest DC stations, capable of delivering up to 400 kilowatts, can recharge cars within 10 minutes, a vast improvement on the 10-12 hours it can take to reload at some AC charging points today. Developers hope drivers will feel more confident about undertaking longer journeys if they know they can reboot with a quick pit stop similar to stopping at a petrol station. With that in mind, the joint venture set up by the German carmakers and Ford to install CCS fast-chargers has teamed up with companies that have service station networks in Europe: Shell, OMV, Germany’s Tank & Rast and retailer Circle K. For traditional carmakers, getting ahead in the electric car race is also about staying relevant in an industry that has been shaken up by Tesla. Elon Musk’s company is now worth US$11 billion more than Ford, even though Tesla delivered just 76,230 cars in 2016 while the US car industry pioneer sold 6.65 million vehicles. The German carmakers teaming up with Ford, however, believe their deeper pockets should give them the upper hand in the long run and they see charging technology as an important factor in the fight. For now, CCS, Supercharger and CHAdeMO plugs continue to be installed in Europe as well as the United States, while China is pressing ahead with GB/T, suggesting it is too early to call a winner in the plug wars — especially as no carmaker will want to lose out on the Chinese market. Tesla, for example, said in October it was modifying its Model S and Model X cars for China to add a second charge port compatible with the country’s GB/T fast-charging standard. Most other rivals are also incorporating the GB/T standard into their vehicles for China, which has ambitious quotas for electric car sales, although some industry officials still hope the country will adopt one of the other standards at some point. While sticking with developing its proprietary network for now, Tesla is a member of the CHAdeMO and CharIN initiatives. It is also selling adapters so owners of its cars in North America and Japan can use CHAdeMO charging stations. Tesla declined to comment on whether it would consider joining a rival charging standard at some point, a move analysts say could be a tipping point in the race for plug dominance. “For Tesla it was always very important to have a charging infrastructure for our clients from the get-go,” a spokeswoman said, adding that it welcomed all investment in car charging. Tomoko Blech, who represents CHAdeMO in Europe, said fussing over which standard would prevail was not helpful given that the electric car industry was still in its early days and carmakers should fight it out with their models. Some also argue there will always be several ways to charge battery-powered cars. “If you drive a petrol car you can fuel it any place in the world. This is the best you can get,” said Nicolas Meilhan, principal analyst at consultancy Frost & Sullivan. “You will not get that for electric vehicles.”

State-owned enterprises 5-year boom

Tue, 02/20/2018 - 17:01
CHINA’S state-owned enterprises administered by the central government saw surging assets in the past five years thanks to improved production and efficiency. Total assets of the centrally administered SOEs stood at 54.5 trillion yuan (US$8.6 trillion) at the end of last year, up 73.8 percent from the end of 2012, according to the country’s SOE regulator. Profits made in the past five years reached 6.5 trillion yuan, up 27 percent compared with the 2008-2012 period. Consolidation among them also picked up as the number of centrally administered SOEs was cut from over 100 in 2013 to just 97 now after a string of mergers and reorganizations. Meanwhile, more than two thirds of China’s centrally administered SOEs and their subsidiaries have introduced outside investors, registered new firms, restructured or gone public to optimize corporate management. Their global competitiveness gained traction thanks to reform efforts, with three Chinese centrally administered SOEs ranking among the top five Fortune 500 Companies of 2017.

Steady growth on economy into 2018

Wed, 02/14/2018 - 17:01
CHINA’S manufacturing activity edged down in December, official data showed yesterday, but largely maintained momentum despite curbs on heavy industry aimed at taming the country’s chronic air pollution. The manufacturing purchasing managers’ index (PMI), a gauge of factory conditions, stood at 51.6 last month, the National Bureau of Statistics said, compared to 51.8 in November. Anything above 50 is considered growth, while under 50 points to contraction. China has curbed activity in heavy industries in the northeast to reduce surplus capacity and the heavy smog that typically blankets the region in late autumn and winter. The index in December is on par with the annual average, still pointing to a strong resilience in China’s growth, according to NBS senior statistician Zhao Qinghe. Sub-indexes for production and new orders came in at 54 and 53.4, respectively. However, the sub-index of raw material inventory stood at 48 in December, down 0.4 percentage points from November, indicating continuously decreasing raw material inventory in the manufacturing sector. China’s manufacturing PMI has been in positive territory for 17 months in a row. The data also showed that the country’s non-manufacturing sector expanded faster in December, with non-manufacturing PMI at 55 in December, up from 54.8 in November. The service sector continued steady growth, with business activity index standing at 53.4 in December. “Early indicators for December show China’s economy pushing into 2018 with growth steady, if unspectacular,” said Tom Orlik, Bloomberg chief Asia economist, as “the official purchasing managers’ indexes show the manufacturing sector slowing slightly and non-manufacturing sector picking up.” “Growth remains remarkably robust, underpinned by resurgent global demand, stimulus-boosted infrastructure spending, and a deleveraging program that remains more honored in the breach than the observance.”

Sales of pre-owned homes drop

Tue, 02/13/2018 - 17:01
SALES of pre-occupied homes fell moderately in Shanghai in January, hovering around 11,000 units for the eighth consecutive month. Some 11,800 pre-owned homes changed hands last month, down 2.6 percent from December, Shanghai Existing House Index Office said in their latest report. That, however, marked a rise of 36 percent year on year. “Taking into account the fact that January is the traditional low season for property sales, it was not a bad performance,” the office said. “It could be an indication that the market was starting to gather some momentum for a future breakthrough.” Meanwhile, the city's existing housing index, which tracks month-over-month price changes in 130 areas citywide, lost 0.32 percent from December, to 3,981 in January. Prices of pre-owned homes rose in 23 areas, fell in 86 areas, and were flat in 21 areas. Around the city, Pujiang in Minhang District, Sanlin in Pudong New Area and Zhaoxiang in Qingpu District were the three most sought-after areas where 290, 278 and 268 pre-used homes were sold last month, respectively. By price, the most notable decreases were recorded in remote areas, while their centrally-located counterparts suffered less of a retreat, the office said. On the inventory side, some 120,885 pre-occupied homes were available for sale around the city as of the end of January, a month-over-month drop of 2.9 percent, and a year-over-year decline of 28.5 percent, according to data compiled by the office. “The local market remains generally stable at the moment, before a highly anticipated recovery in March,” said Lu Wenxi, senior manager of research at Shanghai Centaline Property Consultants Co, one of the city’s major realty chains. “Most individual owners are willing to offer a price discount of around 5 percent but a further cut seems quite difficult.”

Shares extend rally to close higher

Tue, 02/13/2018 - 17:01
SHANGHAI stocks extended their rebound yesterday, boosted by gains in insurance and tourism shares. The Shanghai Composite Index rose by 0.98 percent to close at 3,184.96 points. Insurers such as China Pacific Insurance Group Co Ltd climbed 4.66 percent and Ping An Insurance Group Co of China Ltd gained 3.17 percent to 67.02 yuan. Tourism shares also gained, with Besttone Holding Co Ltd up 6.81 percent and BTG Hotels Group Co Ltd advancing 5.45 percent. Investor confidence in the tourism sector rose after 23 of the 27 listed tourism companies, which have so far released their 2017 annual reports, posted positive growth. Real estate developers such as Yunnan Metropolitan Real Estate Development Co Ltd gained over 8 percent, and Changchunjingkai Group Co Ltd surged 9.99 percent. Among the biggest advancers yesterday were non-bank financial shares, with Panda Financial Holding Corp Ltd and Xishui Strong Year Co Ltd Inner Mongolia both rising by more than 5 percent.

Cash deposits imposed on US chemical

Tue, 02/13/2018 - 17:01
CHINA told importers of a US industrial chemical to start posting deposits yesterday in preparation for possible anti-dumping duties. A preliminary ruling by the Ministry of Commerce said styrene monomer from the United States, South Korea and Taiwan is being sold at prices 5 to 10.7 percent below the proper level. The chemical is widely used to make packaging and consumer products. Importers must now pay cash deposits while the ministry completes its investigation. The ministry said in its ruling the Chinese styrene industry has been “substantially damaged” by dumping, which occurs when manufacturers sell a product to another country at unusually low prices. The decision follows President Donald Trump’s approval last month of higher tariffs on Chinese-made solar equipment and washing machines that Washington said were sold at unfairly low costs. China’s steady accumulation of multibillion-dollar trade surpluses with the US — which widened in January to US$21.9 billion — has prompted demands for import controls. Meanwhile, Chinese authorities have accused Trump of threatening the global trade regulation system by taking action under US law instead of through the World Trade Organization. Beijing has filed a challenge in the WTO against Washington’s latest trade measures. It also launched an anti-dumping probe of US sorghum exports earlier this month. Styrene monomer figures in plastic packaging, as well as low-cost consumer products, which are central to China’s e-commerce industry.

Career growth motivates job seekers

Tue, 02/13/2018 - 17:01
CHINESE mainland candidates value career progression as the key motivator when they decide whether to accept a new job, according to recruitment company Hays. Career progression was chosen by 62 percent of respondents in a survey as the motivator they valued highest in choosing a job, according to a latest web poll by Hays. Salary and benefits were chosen by 25 percent and 13 percent picked corporate culture as the most important factor in their job decision. “Salary and benefits have long been a key concern for job hunters in the mainland, but with 37 percent more job hunters valuing the importance of identifiable career paths over monetary gains, that’s a significant message for employers,” Simon Lance, managing director of Hays China, said. Sixty percent picked non-career progression as second only to the 65 percent who blamed the lack of competitive salary or benefits as the main reason for looking for a new employer, Hays said in another report. Hays said new challenge and lack of training or development are also important for employees seeking new jobs.

China’s ODI keeps double-digit growth in January

Tue, 02/13/2018 - 17:01
CHINA’S non-financial outbound direct investment maintained double-digit growth in January, the third straight monthly increase, official data showed yesterday. Chinese investors made 69.5 billion yuan (US$11 billion) of non-financial ODI in 955 overseas enterprises from 99 countries and regions last month, the Ministry of Commerce said. The investment surged 30.5 percent from the same period last year, the ministry said. The growth tracked a gain of 49 percent in December and an increase of 34.9 percent in November. “The structure of outbound investment has been optimized,” said Han Yong, a ministry official said. In January, no new ODI projects were reported in property, sports or entertainment. Investment in leasing and business services rose 14.4 percent year on year, while that in household services and other service industries surged 163.6 percent. Investment in wholesale and retail industries climbed 24.2 percent. ODI in the mining sector soared 793 percent year on year to US$3.8 billion in January. China’s ODI has seen rapid growth in recent years. However, noting an “irrational tendency” in outbound investment, authorities have set stricter rules and advised companies to make investment decisions more carefully. In a document released in August last year, the State Council said overseas investment in areas including real estate, hotels, cinemas, and entertainment would be limited, while investment in sectors such as gambling would be banned. In November, the National Development and Reform Commission, China’s economic planning body, released a new draft rule on outbound investment, including stipulation on the investment activities of firms established overseas by domestic companies. Meanwhile, ODI to countries involved in the Belt and Road Initiative has been encouraged. Last month, Chinese firms made US$1.2 billion of new investment in 46 countries along the B&R, up 50 percent year on year and taking up 11.4 percent of the total, the ministry said.

Policies drawn for recycling of batteries

Tue, 02/13/2018 - 17:01
CHINESE authorities are preparing policies on the recycling of batteries due to the rapidly-expanding new energy vehicle market. The Ministry of Industry and Information Technology is expected to roll out policies to clarify industrial standards and regulate battery recycling this year, the Xinhua-run China Securities News reported yesterday. The new policies will “focus on bringing batteries to formal recycling enterprises,” said Li Yuke with China Automotive Technology and Research Center. China expects the total production and sales of NEVs to hit 5 million by 2020. A total of 777,000 NEVs were sold on the Chinese market last year, up 53.3 percent year on year. “As the average lifespan of the batteries is about five to eight years, China is likely to see explosive growth in battery disposal in the next two years,” said Zhang Ying from the China Resource Recycling Association. Lithium batteries, commonly used in NEVs, pose a decreased hazard to the environment than lead-acid batteries. Copper, cobalt and nickel in the batteries also have high recycling values. CATRC estimated that China would see 120,000 to 200,000 tonnes of batteries disposed of between 2018 and 2020, and 350,000 tons in 2025. In 2016, China’s State Council said NEV makers should be responsible for building a recycling network for used batteries, and use an after-market network to recycle used batteries. The ministry will also monitor NEV development and manage battery recycling, and explore more high-tech, economical and environmentally-friendly ways of recycling, the report said, citing Gao Yunhu, a ministry official.

Businesses tap opportunities of rising singles

Tue, 02/13/2018 - 17:01
While a rising number of single people worry their Chinese parents, the demographic shift has become a business opportunity for retailers and service providers.Cui Sha, 33, works in a training agency in Beijing. Like many singles who live alone and have a large disposable income and willingness to spend, Cui has a unique requirement in choosing furniture and home appliances — they must be small in size.To satisfy the need of solo consumers, home appliance manufacturers have introduced smaller products ranging from rice cookers, ovens and kettles to refrigerators and washing machines.On Alibaba’s Tmall online marketplace, one store has sold more than 3,000 mini-sized home appliances in just one month.Food companies also want to take advantage of the single market. Haidilao, China’s dominant hotpot chain, uses large cuddly toys to attract single diners.According to Cao Yan, a customer manager at a Xi’an-based Haidilao outlet, her restaurant started providing toys such as a large teddy bears to accompany solo diners two years ago.“We pay more attention to solo diners to make them feel less lonely and embarrassed as most diners come with friends and family members,” said Cao, who has seen a rising number of customers eating alone over the past 12 years.Food delivery services have benefited from the trend too. The Financial Times said in a report last August that 65 percent of orders of Meituan-Dianping, a food delivery and restaurant review company, came from unmarried customers.Traveling alone has also become a popular choice of entertainment for singles who are well-educated, financially independent and willing to improve their living quality.Zhang Chen, 32, is single and spends around 30,000 yuan (US$4,700) on tourism each year. “The unattached lifestyle gives me more freedom. I don’t need to work out complicated plans in advance and I can visit wherever I want,” Zhang said.According to statistics from Chinese online travel agency Ctrip, the number of passengers traveling alone has grown from 8.3 percent in 2014 to 15 percent in 2016.Fu Weigang, executive president with SIFL Institute, cited a report from Southwest Securities that China had around 170 million single adults of marriageable age in 2013.The shift is driven by a trend of delaying or opting out of marriage entirely, a rising divorce rate, and a profound change in young people’s perceptions of remaining single.In a culture that places value on family, Chinese parents are often deeply involved in their children’s marriage.Xi’an singleton Li Wei, 28, will celebrate the upcoming Valentine’s Day with her single friends to dodge family pressure. “I’m not in a hurry to settle down until I meet my Mr Right,” she said.Xia Xuemin, guest researcher with Public Policy Research Institute of Zhejiang University, said that a family consisting of two people needs one refrigerator, while a family with one person also needs one refrigerator.” Therefore, singletons can better boost consumption,” he said.

PBOC injects US$62.2b via MLF tool

Tue, 02/13/2018 - 17:01
CHINA’S central bank yesterday injected 393 billion yuan (US$62.2 billion) into the market via the medium-term lending facility to maintain liquidity. The People’s Bank of China, the central bank, said the injected funds would mature in one year at an interest rate of 3.25 percent. The MLF tool was introduced in 2014 to help commercial and policy banks maintain liquidity by allowing them to borrow from the central bank using securities as collateral. The central bank increasingly relies on open-market operations, rather than changes in interest rates or reserve requirement ratios, to manage liquidity in a more flexible and targeted manner. It suspended reverse repurchase, or repo, operations for the 15th consecutive working day yesterday, citing sufficient liquidity in the banking system. China will maintain a prudent and neutral monetary policy in 2018 as it strives to balance growth and risk prevention.

MGM casino resort opens as license renewal looms

Tue, 02/13/2018 - 17:01
MGM Resorts has launched a lavish multibillion-dollar casino resort in Macau in the latest big bet by foreign gaming companies on the southern Chinese gambling haven. Las Vegas, Nevada-based MGM Resorts International opened its US$3.4 billion resort’s doors, watched over by a colossal statue of MGM’s signature gold lion, yesterday. It’s a high-stakes wager on the casino market’s future in Macau, where gambling licenses expire in as little as two years. CEO James Murren said the company was taking a “leap of faith” that the government will extend its license even though officials have revealed little about the process. The new resort, MGM Cotai, is its second in the tiny Chinese enclave but the first on the Cotai Strip, an Asian version of the Las Vegas Strip that’s the epicenter for extravagant new casino expansion projects. The doors open just in time for the busy weeklong Lunar New Year holiday beginning tomorrow, when Chinese mainland tourists typically flood the tiny enclave. The opening was delayed by damage from Typhoon Hato in August, which killed 10 people. Many of the atrium roof’s triangular glass panels still had cracks caused by the storm's high winds but casino representatives said they were safe because only the outer of five glass layers was damaged. Highlights include a US$13 million art collection of 28 Qing Dynasty carpets, an orb-shaped Swarovski crystal chandelier and haute couture dresses decorating the lobby. There are also luxury shops, celebrity chefs and theater shows, including one described as a “mind-bending and harmonious technological symphony.” The atrium’s sides are covered in LED screens showing digital art such as rice paddies at sunset or “green walls” growing endangered plant species Macau is the world’s biggest gambling market and the only place in China where casinos are legal. Licenses for the city’s six casino operators are due to start expiring in 2020, with MGM's among the first. The government has released no information about the renewal process, the first since a gambling monopoly ended in 2002, allowing in foreign operators also including Las Vegas Sands and Wynn Resorts. “I have no answers but I have a lot of trust” that the government will renew MGM’s license, Murren said. He said he thinks officials will do so based on the company's track record of adding non-gambling attractions to help meet the government's goal of diversifying the economy. “Sometimes you have to have a leap of faith,” Murren said in an interview. “We feel we are the kind of company the government would like to see here.”

China building test site for unmanned ships

Tue, 02/13/2018 - 17:01
CHINA has started building the world’s largest test site for unmanned ships — a technology with both civilian and military applications — off a port in the South China Sea, state media said yesterday. The test area is being constructed off the southern port city of Zhuhai bordering Macau, Xinhua news agency said. Unmanned or “autonomous” ship technology, still in its infancy, would allow both civilian and military craft to be remotely controlled. It could revolutionize the shipping industry by creating more cargo space on unmanned ships, which would also save huge sums in labor costs. As the first of its kind to be built in Asia, Zhuhai’s “unmanned boat test site” is expected to become the world’s largest with an area of ​​770 square kilometers. Islands in the test zone will be equipped with GPS, sonar, communication instruments or photoelectric components to guide ships and boats, according to the China’s Science and Technology Daily. No commissioning date has been announced. “Beijing will use this test site to develop a series of new unmanned systems for military but also for civilian purposes, as this technology can potentially contribute to its economic development,” said Collin Koh, specialist in regional naval affairs at Singapore’s S. Rajaratnam School of International Studies. “It symbolises its rise as a world maritime power and is meant to position it in the future market for unmanned ships, whether for civilian or military applications.” Various unmanned ship projects already exist in the European Union and the United States. Norway is set this year to launch the world’s first wholly electrically-powered and autonomous freighter. China is trying to catch up in this field. It plans to launch at the end of the year its own autonomous vessel, the Jindouyun, for river transport and ferrying goods to islands.

Strict eye on insurers’ overseas funding

Tue, 02/13/2018 - 17:01
CHINA intends to scrutinize insurers’ overseas funding activities more stringently, according to a latest joint notice by the country’s insurance and foreign exchange regulators. Insurance companies must ensure that their outstanding overseas loans under domestic guarantee should be not more than 20 percent of their assets as of the end of the last quarter under a new policy. Overseas loans under domestic guarantee are basically credit mainly aimed at domestic enterprises to help them bid for international contracts and provide funding for them to make foreign investments. The Insurance Asset Management Association of China must assess insurance companies if their offshore funding activity backed by domestic guarantee exceeds US$50million, according to the joint notice from the China Insurance Regulatory Commission and the State Administration of Foreign Exchange. Insurers who want to conduct a warranty loan business have to ensure their solvency adequacy ratio shall not be less than 150 percent as of the end of last quarter, the notice said. Malpractices like foreign exchange fraud and transferring assets abroad in the name of overseas financing are forbidden as are any arbitrage or illegal speculative transactions. Insurance companies must carry out comprehensive due diligence on the invested projects and to strictly enforce the nation's policy on overseas investment.

JPMorgan Chase to clear yuan

Tue, 02/13/2018 - 17:01
China’s central bank yesterday named JPMorgan Chase & Co as a yuan clearing bank in the United States, as Chinese authorities seek to boost global use of the yuan.The choice of the largest US bank by assets was made according to an agreement with the Federal Reserve, the People’s Bank of China said in a short statement on its website.Senior Chinese and US officials agreed to facilitate yuan trading and clearing in the US during a bilateral Strategic and Economic Dialogue in 2016.In September 2016, the PBOC named Bank of China’s New York branch to be a yuan clearing bank in the United States.There are some signs of a revival in the international use of the Chinese currency after several years in the doldrums.China’s non-financial outbound direct investment surged nearly 40 percent in January from a year earlier, data showed yesterday, in the latest sign that the government may be slowly easing tough foreign exchange restrictions.

Faster rise in R&D spending

Tue, 02/13/2018 - 17:01
CHINA’S spending on research and development grew faster in 2017 as the country continued to push for innovation-driven development. Preliminary calculations showed that R&D spending increased 11.6 percent year on year to 1.75 trillion yuan (US$280 billion) in 2017, 1 percentage point higher than in 2016, according to the National Bureau of Statistics yesterday. The spending accounted for 2.12 percent of China’s gross domestic product, 0.01 percentage points higher than the previous year. Chinese enterprises spent over 1.37 trillion yuan on R&D last year, up 13.1 percent from 2016, while R&D spending at government institutions and colleges rose 7 percent and 5.2 percent, respectively.

Singapore’s Q4 GDP seen to slow

Mon, 02/12/2018 - 17:01
A ferry sails past Pasir Panjang container terminal port in Singapore yesterday. Singapore’s economy is set to have grown less than initially expected in the fourth quarter as factory activity and exports slowed, suggesting the recent easing in booming sales of electronics could hit growth this year. A Reuters poll yesterday predicted quarterly growth at 2 percent in the October-December period on a seasonally adjusted and annual basis, slowing from the 2.8 percent preliminary figure.

China’s banks post US$458b in record new loans in January

Mon, 02/12/2018 - 17:01
CHINA’S banks extended a record 2.9 trillion yuan (US$458.3 billion) in new yuan loans in January, blowing past expectations and nearly five times the previous month as policymakers aim to sustain solid economic growth while reining in debt risks. While Chinese banks tend to front-load loans early in the year to get higher-quality customers and win market share, the lofty figure was even higher than the most bullish forecast by economists in a Reuters poll. Net new loans surpassed the previous record of 2.51 trillion yuan in January 2016, which is likely to support growth not only in China but may underpin liquidity globally as major Western central banks begin to withdraw stimulus. Analysts polled by Reuters had predicted new yuan loans of 2 trillion yuan, up sharply from December’s 584.4 billion yuan. A more detailed breakdown of the loan data yesterday showed sharp pickups in demand for credit from both households and companies, auguring well for consumption and investment. “Banks hope to lend early to get early returns... private investment and manufacturing investment are picking up due to firmer global demand (and) household loans could be boosted by property demand,” said Nie Wen, economist at Hwabao Trust in Shanghai. “This indicates the economy may slow in the first half but any slowdown won’t be sharp.” Corporate loans surged to 1.78 trillion yuan from 243.2 billion yuan in December, while household loans rose to 901.6 billion yuan in January from 329.4 billion yuan in December, according to Reuters calculations based on the central bank data. China is in the second year of a regulatory push to clamp down on riskier financial activity that has been fueled by a rapid build-up in debt. But authorities are proceeding cautiously and keeping liquidity broadly supportive to avoid any sharp drag on the world’s second-largest economy or excessive financial market volatility. Broad M2 money supply also beat expectations, growing 8.6 percent in January from a year earlier, central bank data showed yesterday. Economists had expected the growth rate to edge up to 8.4 percent from 8.2 percent in December. Other data last week had painted a somewhat mixed picture of the economy at the start of the year, with inflationary pressures easing — possibly pointing to softening activity — but better-than-expected import and export growth. Taken together, the stronger credit and trade data would appear to still support the consensus view that China will see only a modest pullback in GDP growth to around 6.5 percent this year, after a forecast-beating 6.9 percent in 2017. Outstanding yuan loans grew 13.2 percent in January from a year earlier, also faster than an expected 12.5 percent rise and compared with an increase of 12.7 percent in December. Last year China’s total new loans hit a record 13.53 trillion yuan, 7 percent more than the previous record in 2016. The credit boom has been fueled by strong economic growth, a robust property market and a crackdown on riskier shadow lending, which has forced banks to shift some loans back onto their balance sheets. Since the start of 2017, Chinese regulators have announced a slew of steps to coax financial institutions to reduce riskier activity and leverage, targeting everything from interbank lending levels to bond trading, negotiable certificates of deposit and entrusted loans. In addition, the People’s Bank of China has been gingerly nudging up money market interest rates, most recently in December, but rates have also been slowly creeping higher on their own as regulators look set to persist with the current “de-risking” campaign much longer than policy crackdowns in the past. Those efforts appear to be bearing fruit. The outstanding amount of banking wealth management products grew just 1.7 percent last year, down from a near 24 percent surge in 2016. Many of these products had strong links with the less-regulated shadow banking sector. Analysts expect authorities to step up their efforts this year, focusing on local government debt, rising corporate and household debt levels and dealing with “zombie” companies. Yesterday, the state planner issued new rules for companies which are planning to issue bonds to put more pressure on debt-laden local governments to get their finances in order. But analysts say more still needs to be done on structural reforms to rein in ballooning corporate debt, which has reached levels that the IMF and others have warned sharply raises the risks of a financial crisis. China’s total social financing, a broad measure of credit and liquidity in the economy, surged to 3.06 trillion yuan in January from 1.14 trillion yuan in December, additional data showed yesterday.

Tighter scrutiny impacts shadow banking deeply

Mon, 02/12/2018 - 17:01
TIGHTENED financial oversight in China is deepening its impact across the shadow banking sector, which will further reduce the sector’s contribution to total social financing flows in 2018, according to the latest quarterly report from Moody's Investors Service. During 2017, Chinese shadow banking assets increased by one tenth of the amount of the previous year, growing 1.1 trillion yuan (US$174.3 billion) versus 11.2 trillion yuan in 2016, according to Moody’s calculations. China’s shadow banking activity also fell as a percentage of GDP for the first time since 2012, falling to 79.3 percent at the end of 2017, from the peak of 86.7 percent at the end of 2016, said George Xu, a Moody’s analyst and the report’s main author. Xu added that the drivers of the slowdown were declines in some previously fast-growing shadow banking segments such as the banks’ wealth management products and non-bank financial institutions’ asset management plans. These two activities have been “the focus” of the authorities’ coordinated regulatory actions since the second half of 2016. Moody’s said that enhanced regulation initially focused on the increasing connection between banks and shadow banks, targeting in particular the buildup of leverage in the financial sector. But now the regulatory crackdown has spread to other major core shadow banking components, said Michael Taylor, managing director and chief credit officer for Asia Pacific at Moody’s. Amid the tightened oversight, the aggregate growth of entrusted loans, trust loans and undiscounted bankers’ acceptances has slowed. The situation will further curb broad shadow banking growth in 2018 and cut its contribution to total social financing flows. “These measures will likely reduce the supply of credit to more marginal borrowers, who are most dependent on shadow finance,” Xu said, adding that refinancing risks will rise for some sectors.

Banks see steady development

Mon, 02/12/2018 - 17:01
SHANGHAI’S banking industry continued to develop and recorded improved asset quality on the whole, during the past year, according to a latest statement from the local banking regulator. As of the end of 2017, the local banking industry saw its assets total 14.75 trillion yuan (US$2.34 trillion), an increase of 2.3 percent year on year, the Shanghai branch of the China Banking Regulatory Commission said in its recent report. From January to December, banks in Shanghai extended 6.72 trillion yuan in loans and attracted 9.37 trillion yuan in deposits, up by 12.9 percent and 5 percent respectively, the report said. Meanwhile, the asset quality of the sector kept improving, with outstanding non-performing loans dropping to 38.03 billion yuan as of the end of 2017, down 2.37 billion yuan compared with 12 months ago.

Alibaba to offer Disney shows on video sites

Mon, 02/12/2018 - 17:01
ALIBABA Digital Media and Entertainment Group has signed a multi-year content licensing agreement with a Walt Disney subsidiary to stream more than 1,000 episodes of Disney animated series on Chinese video streaming platforms. The agreement will cover multiple distribution channels, including Alibaba’s flagship online platform Youku, via PC and mobile, as well as direct-to-the-consumer video platforms selected by Alibaba via SmartTV and set-top boxes, according to a joint statement yesterday. “The addition of Disney content greatly enriches the library of quality international content on Alibaba’s media and entertainment ecosystem, giving us a leading edge in foreign content distribution in China,” said Yang Weidong, president of Alibaba Digital Media and Entertainment Group’s video streaming platform Youku. “We look forward to further cooperation with global entertainment companies, which will help increase our penetration in the family entertainment segment and strengthen Youku’s position as a leading multi-screen entertainment and media platform in China,” he added. More than 100 live-action and animated Disney movies, including titles such as “Pirates of the Caribbean,” and animated classics “Beauty and the Beast,” “Mulan” and “Frozen,” would also be a part of the licensed content under this multi-year licensing agreement. In December last year, Youku also signed licensing deals with NBCUniversal and Sony Pictures Television to access the two studios’ movie libraries and broaden its content offering and to strengthen its partnership with overseas studios. Alibaba Group has been driving its digital media and entertainment business since it set up its cultural and entertainment unit in 2016. In the fourth quarter last year, revenue from its digital media and entertainment business surged 33 percent from a year ago to 5.4 billion yuan (US$856 million). Earlier this month, Alibaba Group said it will pay 4.68 billion yuan for 7.6 percent of Wanda Film at 51.96 yuan per share, becoming Wanda Film’s second-largest shareholder. The revenue of China’s online video industry reached 21.86 billion yuan in the second quarter of 2017, up 14.4 percent from a year earlier, said a report by domestic Internet consultancy iResearch Inc. It estimated the online video streaming market at 200 billion yuan by 2020.

Festive mood keeps home seekers on the sidelines

Mon, 02/12/2018 - 17:01
NEW home transactions fell below the 100,000-square-meter weekly threshold again as the prevalent festive mood across Shanghai kept more home seekers sitting on the sidelines, latest market data showed. The area of new homes sold, excluding government-subsidized affordable housing, plunged 37.5 percent from the previous week to 80,000 square meters during the seven-day period ending on Sunday, Shanghai Centaline Property Consultants Co said in a report released yesterday. The city’s outlying districts of Jiading, Qingpu and Chongming, where some 14,000 square meters, 13,000 square meters and 12,000 square meters of new homes were sold, respectively, remained the most sought-after areas despite a rather notable retreat in sales. Buying momentum in downtown areas was the most sluggish, with the former Jing'an and Hongkou districts recording zero transactions last week. The average cost of new homes rose 6.7 percent week on week to 43,040 yuan (US$6,822) per square meter, with none of the 10 best-selling projects costing over 50,000 yuan per square meter, according to Centaline data. A Tahoe Group development in Changxing Island, Chongming District, remained the city’s most popular housing project for the second straight week after unloading 10,950 square meters, or 109 units, of new homes last week for an average price of 28,000 yuan per square meter. Real estate developers again did not release a single unit of new homes for sale. “As the Spring Festival is falling in a few days, extremely weak sentiment in the city’s housing market, both new and existing, should extend for another two to three weeks before a major rebound occurs,” said Lu Wenxi, senior manager of research at Centaline.

Honda set to recall 350,000 cars

Mon, 02/12/2018 - 17:01
HONDA Motor Co will recall roughly 350,000 vehicles in China to resolve a cold-climate engine issue and quell a barrage of customer complaints that has hit the automaker over the past month. The recall involves the CR-V sport utility vehicle and the Civic model equipped with a 1.5-liter turbo engine, Honda’s joint venture with Dongfeng Motor Group Co said in a statement yesterday. The company is calling back those cars to resolve a problem caused by an unusual amount of un-combusted petrol collecting in the engine’s lubricant oil pan. The issue in some cases caused a strong odor of gasoline inside the car and in other cases the car’s check-engine light came on. Honda and Dongfeng plan to resolve the issue by updating the engine’s gasoline injection control software. Honda officials said there had been no reports of accidents. They said the engine oil issue doesn’t affect the engine or the car’s performance. The measure comes after CR-V and Civic owners turned to the Weibo microblog — China’s Twitter equivalent — and other means to air their complaints since mid January. The recall points to an emerging pattern in China where customer complaints spiral as they are aired out on Weibo, forcing an automaker to respond. Years ago the kind of recall Honda announced yesterday could have been dealt through a so-called customer service action, industry officials and experts say. That refers to what the auto industry calls a “quiet recall,” which is less damaging financially and image-wise, where an automaker fixes a non-safety issue, often free of charge, whenever the customer comes to the dealership. A Beijing-based spokesman and other company officials said Honda and its joint venture partner are likely to recall 350,000 vehicles.

Alibaba to pay US$870m for 15% of Easyhome

Mon, 02/12/2018 - 17:01
ALIBABA is to pay 5.5 billion yuan (US$870 million) to buy a 15 percent stake in Easyhome, a domestic home improvement chain. Alibaba will help digitalize Easyhome’s outlets and “improve customer experience,” under an agreement, Alibaba sources said. Beijing-based Easyhome had 223 outlets in the country at the end of 2017, with sales of over 60 billion yuan last year. Alibaba has invested in the retail sector, covering home appliances, digital products, fast-moving consumer goods and catering.

Shares rally after 5 days

Mon, 02/12/2018 - 17:01
SHANGHAI stocks rebounded yesterday after dropping for five straight trading days last week, helped by gains made by electronic component stocks and household appliance companies. The Shanghai Composite Index added 0.78 percent to close at 3,154.13 points. Electronic component shares such as Chengdu Xuguang Electronics Co surged by the daily limit of 10 percent. Hangzhou Silan Microelectronics Co Ltd and Ningbo Shanshan Co Ltd both gained over 9.9 percent. Household appliance shares rose as well, with Shanghai Highly Group Co Ltd up by 9.98 percent and Zhejiang Three Stars New Materials Co Ltd gaining 8.29 percent. Agricultural machinery companies were also gainers after investor sentiment was buoyed by a newly-released central government policy that promotes rural development. Thinker Agricultural Machinery Co Ltd jumped 9.21 percent and First Tractor Co Ltd advanced 6.57 percent.

Private sector’s development to be supported

Sun, 02/11/2018 - 17:01
CHINA remains unwavering in its support of the private sector and will create favorable conditions for its development, Vice Premier Wang Yang said. Governments will continue to improve the business environment, maintain stable policy expectations, and protect the rights and interests of private companies, Wang told entrepreneurs on Friday at a meeting held to solicit their opinion. The private sector has witnessed a boom since reform and opening-up began 40 years ago and has become an important part of the economy. At the end of 2017, there were 65.8 million individually owned businesses and 27.3 million private enterprises, which employed 341 million people. Wang called on private businesses to tap fully their advantages to contribute to the country’s “three tough battles” for the next three years — risk prevention, poverty alleviation and pollution control. Wang said he hoped the private sector would improve risk control, help create jobs and improve incomes in poor areas, and develop an energy-saving and environmentally friendly industrial structure.

66m jobs created over past 5 years

Sun, 02/11/2018 - 17:01
CHINA created over 66 million urban jobs over the past five years, official data showed. Over the five years, 90 percent of college graduates found jobs and more than 1.1 million redundant workers resulting from China’s excess production capacity cuts were re-employed, said Yin Weimin, minister of human resources and social security. By the end of 2017, the joblesst rate in urban areas was 3.9 percent, the lowest since 2002, official data showed. From 2013 to 2017, over 13 million jobs were created annually in urban areas, despite the negative effect of economic structuring and slowing growth, official data showed. In 2017, 13.51 million new jobs were created in urban areas. The central government set an increase of 11 million jobs as its official target for the whole of 2017. Yin said China will continue implementing and improving employment and entrepreneurial policies to create more jobs in 2018. China has unveiled pro-employment policies for graduates, redundant workers, the disabled and migrant workers.

Steel profits, prices rise on excess cut

Sun, 02/11/2018 - 17:01
CHINA’S steel industry posted higher prices and better profits last year as a result of progress made in reducing excessive capacity, the Ministry of Industry and Information Technology said. The steel price index was 121.8 at the end of December, up 22.4 percent from the beginning of 2017, the ministry said. It attributed the increase to cutting overcapacity, a ban on low-quality steel, production restrictions during winter, and recovering market demand. China slashed its crude steel production capacity by more than 50 million tons in 2017, exceeding its annual target, as part of efforts to improve the competitiveness of the bloated sector. China also phased out the production of 140 million tons of low-quality steel made from scrap metal last year. The industry’s profitability improved, with major steel producers’ profits surging 613.6 percent, the ministry cited data from the China Iron and Steel Association as saying. Despite the improvement, the ministry warned of more difficulties in further capacity reduction as the increased profits may lure some producers to launch new projects. China plans to cut 100 million to 150 million tons of crude steel capacity in five years from 2016.

New areas listed for ‘sensitive’ investment

Sun, 02/11/2018 - 17:01
CHINA’S state planner included news media and weapons development in its list of “sensitive” sectors for offshore investment yesterday, meaning any deals in those areas could face greater scrutiny. Development of cross-border water resources also was listed as a “sensitive” sector, confirming draft changes to the guidelines first issued in November. Those guidelines for the first time treated outbound investment by Chinese individuals in the same way as such investments by companies. They also require domestic firms making outbound investments of over US$300 million to seek approval from the planner, the National Development and Reform Commission. The list maintained restrictions on offshore investments in real estate, hotels, motion picture studios and sports clubs. NDRC also deleted some sectors from the list. For investment in overseas projects of telecoms operation, massive land development, and electric mains and power grids, official approval is no longer necessary. China’s non-financial outbound direct investment in 2017 fell 29.4 percent year on year to US$120.08 billion, as the government mounted a campaign against what it called “irrational” outbound investment. The NDRC list will come into effect from March 1, the notice said.

China to start yuan-based crude oil futures

Sun, 02/11/2018 - 17:01
CHINA will launch crude oil futures on March 26, as the world’s second largest economy moves to gain pricing power over commodities. After years of false starts, the crude futures contract will make its debut at the Shanghai International Energy Exchange, the China Securities Regulatory Commission, said on Friday. Preparations for the launch of the oil futures have almost been completed, Chang Depeng, spokesperson for the CSRC, told a press conference. China set up a petroleum exchange in the early 1990s but soon ceased trading due to reform and market factors. The contract will enable China to develop its own benchmark for oil pricing in addition to current global benchmarks. The Asia-Pacific region has surpassed America and Europe in crude consumption, but a benchmark with high recognition is still missing. China is the world’s second largest oil consumer after the United States. Demand is likely to soar in the future as the country is thirsty for crude to fuel its economy. In the absence of a crude benchmark in the region, Asian countries pay more than Europe and America for imported oil. It is an additional US$2 billion a year in the case of China. The WTI and Brent futures contracts are not accurate reflections of oil prices in Asia. China’s crude contract offers companies in the real economy a hedging tool which better reflects market conditions in Asia, said Wu Jian, a senior researcher with the Bank of Communications. The move will also boost the yuan’s global use through increasing the trade of yuan-denominated oil. Currently, the main global benchmarks for crude oil are priced in US dollars, threatening China’s energy and economic security. The yuan-denominated contract means the Chinese currency will play a greater role in trade between China and other oil-producing countries. But analysts said it could take time before China’s new oil futures challenge the dominance in oil trading of the two current global benchmarks, or the prominence of the US dollar in the global financial system. Bai Ming, a researcher with the Ministry of Commerce, said it is natural that competition arises after long time of development, but challenge will not necessarily happen in the end. Importers that buy yuan-denominated oil contracts may not necessarily drop out of the European and American markets. It is very likely that they keep multiple selections to serve businesses in different regions. China has been working to translate its growing economic might into real influence by having a greater voice in global price-setting and making its currency play a bigger role on the global stage. The yuan is rising in cross-border trade. A survey by the Bank of China said 76 percent of respondents from 25 countries and regions believed the yuan would play a role as important as other major currencies.

Samsung’s ailing boss suspect in tax evasion case

Thu, 02/08/2018 - 17:01
SAMSUNG Electronics’ ailing chairman, Lee Kun-hee, was named by South Korean police yesterday as a suspect in an 8.2 billion won (US$7.5 million) tax evasion case that involved the use of bank accounts held by employees. A series of scandals have dogged the family of Samsung, the country’s biggest business empire. The chairman’s son Jay Y. Lee, heir to the Samsung Group, was released from detention earlier this week after an appeals court halved his sentence for bribery and corruption to 2-1/2 years and suspended it for four years. Following a heart attack in 2014, the elder Lee, 76, has remained hospitalized in Seoul’s Samsung Medical Centre and is difficult to commuicate with having shown little sign of recovery. Until his imprisonment Jay Y. Lee had been regarded as the de facto head of the group. Police said elder Lee could not be questioned due to his physical condition and Samsung declined comment. “Samsung chairman Lee Kun-hee and a Samsung executive managed funds in 260 bank accounts under names of 72 executives, suspected of evading taxes worth 8.2 billion won,” Korean National Police Agency said in a statement, planning to send the case to prosecutors. Police added that the accounts, holding some 400 billion won, were found in the course of their probe into alleged improper payments for the renovation of Lee’s family residence. The investigation into tax evasion harks back to the late payment of 130 billion won in tax in 2011, though only 8.2 billion of that sum falls within the statute of limitations, according to police. The graft case that led to the younger Lee’s arrest last year and brought down former president Park Geun-hye prompted Samsung to vow to improve transparency in corporate governance and grant heads of the group’s affiliates more autonomy from the Lee family. The group dismantled its corporate strategy office in late 2017. The new liberal government led by President Moon Jae-in elected after the corruption scandal promised to put family-run conglomerates under stronger scrutiny and end the practice of pardoning corporate tycoons convicted of white-collar crimes. Though Jay Y. Lee has not been seen back at the office since his release on Monday, members of the Korean business community expect him to take up the reins once again, and invest more in the business to create jobs that might help soothe public anger. Reurning home from prison, the younger Lee apologized for not showing his best side and said he would do his best but did not give specifics on his business plans. While he spent a year behind bars, Samsung Electronics, the world’s top semiconductors maker, earned record profit as it benefitted from a memory chip “super cycle”. It is not the first time the elder Lee has been investigated for tax evasion. He was convicted in 2009 and later pardoned for tax evasion after being embroiled in a scandal that also involved the use of accounts held by trusted employees. Police say they have since identified more such accounts.

Claims for jobless benefits fall to lowest since 1973

Thu, 02/08/2018 - 17:01
THE number of Americans filing for unemployment benefits unexpectedly fell last week, dropping to its lowest level in nearly 45 years as the labor market tightened further, bolstering expectations of faster wage growth this year. Initial claims for state jobless benefits fell 9,000 to a seasonally adjusted 221,000 for the week ended February 3, the Labor Department said yesterday. Claims fell to 216,000 in mid-January, which was the lowest level since January 1973. Economists polled by Reuters had forecast claims rising to 232,000 in the latest week. Last week marked the 153rd straight week that claims remained below the 300,000 threshold, which is associated with a strong labor market. That is the longest such stretch since 1970, when the labor market was much smaller. The labor market is near full employment, with the jobless rate at a 17-year low of 4.1 percent. The tighter labor market is starting to exert upward pressure on wage growth. The Labor Department reported last week that average hourly earnings jumped 2.9 percent year on year in January, the largest gain since June 2009, after rising 2.7 percent in December. Strong wage growth supports optimism among Federal Reserve officials that inflation will increase toward the US central bank’s 2 percent target this year. US financial markets expect the Fed will raise interest rates in March. The Fed has forecast three rate increases for this year, but much will depend on the inflation outlook and financial conditions. The Fed lifted borrowing costs three times in 2017. US financial markets were little moved by the claims data. The Labor Department said claims for Maine were estimated last week. It also said claims-taking procedures in Puerto Rico and the Virgin Islands had still not returned to normal months after the territories were slammed by Hurricanes Irma and Maria. Last week, the four-week moving average of initial claims, seen as a better measure of labor market trends as it irons out week-to-week volatility, fell 10,000 to 224,500, the lowest level since March 1973. The claims report also showed the number of people getting benefits after an initial week of aid fell 33,000 to 1.92 million in the week ended January 27.

Twitter posts 1st quarterly profit

Thu, 02/08/2018 - 17:01
TWITTER yesterday reported its first-ever quarterly profit, in a key milestone for the social network which has been lagging for years against fast-growing rivals. San Francisco-based Twitter said it earned US$91 million in the fourth quarter, the first positive net income since going public in 2013. Revenue was up 2 percent from a year ago to a better-than-expected US$732 million. The number of monthly active users was 330 million, flat from the prior quarter but up 4 percent from a year earlier. While Twitter has built a solid core base of celebrities, politicians and journalists, it has failed to achieve the broader appeal of Facebook and other social platforms, hurting its ability to bring in ad revenues. The profitability is an important achievement for Twitter, which has lost money consistently since its public offering, sparking speculation on whether it needed to sell itself to keep operating. Chief Executive Jack Dorsey welcomed “a strong finish to the year,” and added “I’m proud of the steady progress we made in 2017, and confident in our path ahead.” The network has stepped up efforts to boost its user base and engagement, adding streaming video partnerships, doubling the character limit on tweets to 280 and making it easier to create “tweetstorms” by stringing messaging together. Dorsey told a conference call that by relaxing the limits, “it minimizes some of the complexities” of using the platform and added, “more importantly it is enabling people to be more expressive about what’s on their minds.” Jennifer Grygiel, a Syracuse University communications professor who follows social media, said the results are an important milestone for Twitter. “It shows that Twitter has staying power,” Grygiel said. “A lot of people have had doubts for several years.” Despite Twitter’s problems these past few years, “it is unlike any other social media platform,” Grygiel said. “It really is the fastest newswire service we’ve ever seen,” she said. “Influencers and news junkies come to Twitter because of that microblogging function that we don’t see in other places.” Earlier this month, BTIG Research analyst Richard Greenfield raised his outlook for Twitter, saying that “management has refocused the company on its core product (and) pushed their product team to iterate far faster than ever before in the company’s history.” Greenfield said Twitter’s use of artificial intelligence had “made the Twitter user experience more compelling by showing consumers the tweets they care most.”

Italy’s rail group sold for US$2.2b

Thu, 02/08/2018 - 17:01
An “Italo — NTV (New Transportation Travelers)” train crosses the Tiburtina station in central Rome yesterday. Italian railway group Italo has accepted a 1.8 billion euro (US$2.2 billion) takeover offer by US-based fund GIP (Global Infrastructure Partners) yesterday.

China’s trade rallies as imports and exports beat expectations

Thu, 02/08/2018 - 17:01
CHINA’S trade machine kicked up a gear in January after stumbling the previous month, with exports and imports both growing much more than expected, pointing to a strong start to the year for global demand. Yesterday’s robust data, along with last week’s strong manufacturing and service surveys, suggest China’s economy remained resilient at the start of 2018 and may even have picked up some momentum, despite crackdowns on factory pollution and riskier financing that are driving up borrowing costs. Exports in January rose 11.1 percent from a year earlier, picking up from a 10.9 percent gain in December, official data showed. Analysts had expected growth to cool for a second straight month to 9.6 percent. Imports surged 36.9 percent, the General Administration of Customs said, the fastest pace since last February and smashing analysts’ forecast of 9.8 percent growth. China’s import growth had sharply decelerated to 4.5 percent in December, raising fears that its domestic demand was slumping as Beijing forced northern smelters and mills to curtail production to reduce thick winter smog. Commodities again led the way in January, with China’s crude oil imports hitting a record and iron ore imports at the second highest on record. The figures left China with its smallest trade surplus in 11 months at US$20.34 billion, compared with December’s US$54.69 billion and forecasts for a US$54.1 billion surplus in January. However, data from China in the first two months of the year must always be treated with caution due to business distortions caused by the timing of the long Lunar New Year holiday, which fell in late January 2017 but start in mid-February this year. Some of the jump in imports may have been due to inventory building ahead of the holiday rather than a pick-up in consumption, though economists said the data were still positive. “January trade data may be affected by the always changing timing of the Chinese New Year holiday...(but) such strong import data indicate that domestic demand momentum remains healthy going into 2018,” Louis Kuijs, head of Asia economics at Oxford Economics, wrote in a note. Kuijs expects China’s import growth to slow in coming months due to unfavorable comparisons with high levels last year and an expected slowdown in overall economic activity. China’s imports surged nearly 16 percent last year, the best since 2011, as a construction boom added to its insatiable demand for raw materials.

M&As in B&R regions increase 47%

Thu, 02/08/2018 - 17:01
CHINA’S cross-border mergers and acquisitions in the Belt & Road regions surged 47 percent year on year in 2017, although overall investment declined last year, a Shanghai-based consulting firm said yesterday. Singapore, Russia and Israel were the top M&A destination countries for Chinese investors. Mining, infrastructure and TMT (technology, media and telecom) industries were hottest sectors for M&As, according to a report from the Morning Whistle Group, a local consultancy firm for cross-border business. Stringent scrutiny from US regulators was cited as a factor for the decline in overall M&A investments from China in 2017, the company said. But M&As in the B&R region posted “sizzling growth” because of the Chinese government’s strong policy support and abundant capital, said the company, without providing detailed figures of M&As. Shanghai was the top region for M&A deals in the B&R region in 2017, with 18 deals confirmed, followed by Beijing, Guangdong Province and Hong Kong, said Morning Whistle.

Leshi ends 11 straight trading days of losses

Thu, 02/08/2018 - 17:01
SHENZHEN-LISTED Leshi Internet and Technology surged almost 7 percent in the morning session yesterday, ending a consecutive 10 percent daily tumble over the past 11 trading days. Leshi, which used to be a flagship firm in the Nasdaq-like GEM or Growth Enterprise Market, halted trading in April over heavy debt and cash flow problems. It then fell by the maximum 10 percent daily limit over 11 trading days since resuming trading. Leshi closed at 5.08 yuan (79 US cents) yesterday, up 5.39 percent from Wednesday. Comparatively, the GEM market gained 1.55 percent yesterday. Investors used about 400 million yuan to purchase Leshi yesterday but they failed to end the 10 percent daily fall, Xinhua reported. Shares lost about 70 percent in value since resuming trading on January 24. Meanwhile, the company still faces problems including heavy debts and business losses. It expected to post a loss of 11.6 billion yuan in 2017, compared with a net profit of 554.8 million yuan in 2016, because of “capital shortage and liquidity problems,” the company said in a statement to the Shenzhen Stock Exchange. Jia Yueting, Leshi’s former chairman, is seen as being responsible for the heavy debt after an aggressive expansion into the electric car and smartphone markets. Jia, who is now in the US, is still the top shareholder of Leshi with a 26 percent stake. But his stake is likely to shrink with the price tumble, said analysts. Sun Hongbin, chairman of property developer Sunac China, is now chairman of Leshi after Sunac invested about 15 billion yuan in the firm last year.

More offerings at East China Fair

Thu, 02/08/2018 - 17:01
THE East China Fair, the country's biggest regional trade show, will offer an area for services providers this year and host more business events and forums, organizers said yesterday. Fifty booths will be set aside for third party service providers to offer certification, logistics, insurance, and factoring services. E-commerce firms will also be sited there. The four-day fair, starting on March 1 at Shanghai New International Expo, will also host more business events and forums, and there will be a special event targeting American and European buyers. Garments, textiles, and home products are the three largest categories of exhibitors at the fair which also includes gifts, modern lifestyle, and e-commerce companies. The fair is set to draw 450 foreign exhibitors from 18 countries and regions including Japan, South Korea, and Poland. Last year’s fair saw the number of overseas buyers rise 3.2 percent annually to 22,140, with Japan, the US and South Korea being the three largest sources of overseas buyers. Turnover at the fair rose 0.28 percent from 2016 to US$2.3 billion last year.

Big cap A shares pull key index lower

Thu, 02/08/2018 - 17:01
BIG cap A shares lost steam yesterday and dragged the key Shanghai stock index to close at a half-year low. The Shanghai composite index shed 1.43 percent, or 47.21 points, to close at 3,262.05, dragged by a 2.7 percent fall in the SSE 50 Index, a gauge of the 50 most valuable companies on the Shanghai exchange. The SSE 50 gauge surged 26 percent in 2017 to rank as the best performer among China’s major equity indexes. Banks, insurers, coal and oil producers were among the worst performers on the SSE 50 Index yesterday, with the Industrial and Commercial Bank of China down by 4.35 percent and the Agricultural Bank of China losing 3.36 percent. Investors did not buy the argument put forward by China Securities News and Securities Times that the fundamentals remained solid and the valuations of blue chips were relatively low compared with other major markets, according to a South China Morning Post report.

Lujiazui plans global asset platform

Wed, 02/07/2018 - 17:01
LUJIAZUI, the commercial and financial center of Shanghai, plans to set up the Global Asset Management Association of Lujiazui in the first half of this year. More than 60 global asset-management institutions, including BlackRock, Fidelity International and JPMorgan, attended a preparatory meeting in Lujiazui on Tuesday. The association aims to establish an exchange platform for global asset-management institutions to help them to set up in Lujiazui and understand China’s asset-management industry. Yuan Yefeng, director of Lujiazui Financial City Authority’s department for finance, shipping and innovation, said the association would attract more leading asset-management organizations to do business in Shanghai. Currently, over 60 overseas asset-management institutions have subsidiaries or plan to set up branches in Lujiazui. Nine of the top 10 global asset-management institutions have wholly foreign-owned enterprises in Lujiazui. By next year, China will have the world’s second-largest asset-management market after the United States, with more than US$17 trillion of assets under management by 2030, up from US$2.8 trillion in 2016, according to Casey Quirk, which advises investment-management businesses. In September 2016, JPMorgan set up a wholly foreign-owned enterprise in the Shanghai free trade zone with the first asset-management license for a foreign company in China. The license allows a foreign firm to offer onshore fixed-income, equity and multi-asset private funds to both institutional and high-net worth investors in China. “There was only one member of staff when the wholly foreign-owned enterprise was founded, but now there are 13. We are growing fast,” said Zhou Lingling, deputy general manager with JPMorgan Asset Management (Shanghai) Ltd. “We are confident of our performance in China, and we will seize every chance in this market,” said Zhou. She said China is expected to become the largest asset-management market in the next five to 10 years. “We are so glad to be a member of the coming Global Asset Management Association of Lujiazui. I believe it will be a great exchange platform for financial institutions like us,” Zhou said. Last July, UBS Asset Management became the first international manager with a Qualified Domestic Limited Partner quota to receive a private fund management license in China. Given the license, UBS is able to provide a broad range of services to onshore and global investors, and to work more closely with subsidiaries of global firms in China to meet their domestic investment needs. Gao Ting, head of China strategy at UBS Securities Equity Research, said at the preparatory meeting that with China’s efforts to open up its capital markets, its yuan-denominated A shares will be included in the MSCI indexes in June, making China’s stock market more important for both onshore and offshore investors. Meanwhile, Chen Ting, general manager with BlackRock Investment Management (Shanghai) Co, also showed her passion for the Chinese market. “Given the opening-up policies and the pleasant business environment, Lujiazui Financial City in Shanghai will be the first choice for global financial companies to do business in China,” Chen said. At the World Economic Forum in Davos last month, China reiterated its commitment to opening banking, securities and insurance sectors. Global investment managers like JPMorgan and Vanguard are eying a share of China’s public fund market as well as China’s pension market, according to Chen. “I hope foreign investment managers like us will be allowed to manage China’s public fund in five to 10 years,” she said.

UK’s Tesco faces US$5.6b in record equal pay suit

Wed, 02/07/2018 - 17:01
SUPERMARKET group Tesco is facing a potential bill of up to 4 billion pounds (US$5.6 billion) in a record equal pay claim involving mainly women workers at its British stores, according to the law firm pursuing the case. If the claim is successful it could have huge implications for British industry. However, it is likely to be bogged down in the courts for years. Tesco is Britain’s biggest retailer and its largest private sector employer with more than 310,000 staff. Law firm Leigh Day said yesterday the mainly male employees in Tesco’s distribution centers were paid considerably more than its largely female store workers. The law firm is also working on claims against supermarket rivals Asda, the British arm of Walmart, and Sainsbury’s, which date back to 2012 and 2015 respectively. Unequal pay for men and women is currently a hot topic in Britain’s boardrooms and corridors of power. The resignation last month of Carrie Gracie as China Editor for the BBC led to an investigation into pay differences at the public broadcaster. British Business Secretary Greg Clark told Sky News he was “surprised” by the scale of the claim against Tesco. A Tesco spokesman said the firm had not yet received a claim. “Tesco has always been a place for people to get on in their career, regardless of their gender, background or education, and we work hard to make sure all our colleagues are paid fairly and equally for the jobs they do,” he said. Leigh Day operates on a no win, no fee basis and takes 25 percent of any compensation obtained by its clients. The law firm said Tesco distribution center staff may earn in excess of 11 pounds an hour, while the most common grade for store staff saw them receive around 8 pounds per hour. This disparity could see a full time distribution worker on the same hours earning over 100 pounds a week — or 5,000 pounds a year — more than store staff. Leigh Day said more than 200,000 Tesco employees may be underpaid and estimated shortfalls could reach 20,000 pounds each, meaning the potential bill for Tesco could be as high as 4 billion pounds. The law firm said it had already started submitting claims on behalf of its clients via conciliation service ACAS, the first stage in the Employment Tribunal process, and had been approached by over 1,000 current and former Tesco employees.

Wynn quits as CEO after sexual assault claims

Wed, 02/07/2018 - 17:01
US casino mogul Steve Wynn has resigned as CEO of his company Wynn Resorts following claims he subjected women who worked for him to unwanted advances, becoming one of the most prominent business leaders to quit over sexual misconduct allegations in recent months. The company said it was appointing Matt Maddox, its president since 2013, as chief executive, effective immediately. Maddox, who has been with Wynn Resorts Ltd since it was founded in 2002, is seen as a firm hand and is widely viewed as a favored protege of Wynn. As the “MeToo” movement galvanizes women to publicly air their experiences, Wynn’s decision represents a rare resignation by a head of a major listed company in the wake of such accusations. It has also led to speculation that Wynn Resorts could become a takeover target, and raises the question of how much influence Wynn, its biggest shareholder, will continue to wield over the firm and how much scrutiny from authorities that will invite. Wynn, 76, has denied the accusations published by the Wall Street Journal as “preposterous” and said they were instigated by his ex-wife, an accusation that a representative for Elaine Wynn has denied. He also resigned as finance chairman of the US Republican Party’s fundraising arm, the Republican National Committee, in January. “In the last couple of weeks, I have found myself the focus of an avalanche of negative publicity...I have reached the conclusion I cannot continue to be effective in my current roles,” he said in a statement. Sparking a wave of harassment and abuse allegations against dozens of powerful men, the “MeToo” movement has had its biggest impact so far in the media industry and politics. US Senator Al Franken resigned in December after facing a series of sexual misconduct allegations. Movie producer Harvey Weinstein, and head of animation at Walt Disney Co’s Disney and Pixar, John Lasseter, are among some of the high-profile men who have been singled out for sexual misconduct. Wynn, who according to Forbes has a net worth of US$3.3 billion, started in Las Vegas casinos in the 1960s, creating some of Las Vegas’ most iconic landmarks — the Mirage, Bellagio and Treasure Island. But he was forced to sell his multi-billion dollar operation Mirage Resorts to tycoon Kirk Kerkorian in a hostile takeover in 2000. Kerkorian then created MGM Mirage and Wynn went on to create Wynn Resorts with his ex-wife in 2002. Shares in Wynn Resorts, which owns the Wynn, Encore Las Vegas casinos as well as its Wynn Macau unit, have tumbled nearly 20 percent since the Journal report on January 26. The company is worth around US$17 billion by market capitalization. Shares in Wynn Macau have slumped around 17 percent before they were put on a trading halt yesterday. Some analysts noted that questions remain over whether Wynn will sell or reduce his stake and how much fighting will ensue over control of the firm.

Chinese firm tests drone taxi flights

Wed, 02/07/2018 - 17:01
A Chinese maker of aerial vehicles, Ehang, based in Guangzhou, capital of Guangdong Province, conducted test flights of its autonomous aerial vehicle, or AAV, on Tuesday. The Ehang 184 series is the world’s first passenger drone capable of carrying a single person at up to 130 kilometers per hour and in force 7 typhoon conditions, China Daily reported the company as saying. Hu Huazhi, founder and CEO of Ehang, founded the company in 2014, and since then more than 150 technical engineers have conducted thousands of test flights, including a vertical climbing test reaching up to 300 meters, a load test flight carrying about 230 kilograms, a routed test flight covering 15 kilometers and a high-speed cruising test that reached 130 km/h. The Ehang 184 AAV will still see further improvements, according to Hu. “These manned test flights are just the latest in a series of tests to ensure that the Ehang 184 AAV will be safe and ready for public use in the near future,” Hu said. Public use of passenger drones, also known as drone taxis, has yet to become a reality and fully depends on improvements in technological innovation and implementation of supportive policies, he said.

Newspapers sold to raise digital sphere

Wed, 02/07/2018 - 17:01
TRONC Inc said yesterday it would sell the Los Angeles Times, the San Diego Union-Tribune and some other newspapers to billionaire investor Patrick Soon-Shiong for US$500 million in cash. Tronc expects to use the cash proceeds from the deal to boost its digital businesses by increasing investments and acquisitions. “This transaction allows us to fully repay our outstanding debt, significantly lower our pension liabilities and have a substantial cash position following the close of the transaction,” Tronc Chief Executive Justin Dearborn said in a statement. Tribune Interactive will become the home to Tronc’s digital assets and will be led by Ross Levinsohn, former publisher and chief executive of the Los Angeles Times. Levinsohn took an unpaid leave of absence last month following disclosure of sexual harassment allegations against him while he worked at other companies. Tronc said an independent investigation did not find any wrongdoing. Soon-Shiong, a major shareholder in Tronc and chief executive of NantHealth Inc, will buy the publications through his private investment vehicle Nant Capital LLC. Nant Capital will also assume US$90 million in pension liabilities as part of the deal, set to close in late first quarter or early second quarter of 2018.

Mom-and-pop investors still cling to older ways

Wed, 02/07/2018 - 17:01
MUCH of China’s stock trading is conducted remotely via high-tech systems in banks and brokerages or on mobile phones, but the country’s masses of mom-and-pop investors still cling to older ways. In scenes that recall an earlier era, pensioners have gathered as usual this week in the countless public trading rooms at Chinese brokerages, frowning at electronic price boards and chattering tensely as markets tumbled. “It has dropped so much and I lost 70,000 yuan (US$11,000) just yesterday,” a 63-year-old woman surnamed Xu said at a branch of Hongta Securities in Shanghai. Concern was etched on Xu’s face as the main stock index fell another 1.82 percent, following a 3.35-percent drop on Tuesday — dragged down by panic on global markets. “We were heartbroken yesterday. Our hearts can’t stand this,” said Xu, who retired from her job at a cement factory two decades ago. Authorities have taken measures to steady China’s stock markets following a 2015 boom-and-bust that devastated the holdings of countless investors and underlined frequent comparisons of the country’s markets to casinos. But elderly retirees still throng trading rooms with riches in their eyes, exclaiming loudly when their favourite stocks tank. Despite the government’s preference for stability, Xu likes the opportunity offered by large price swings — preferring volatile tech stocks over blue chips like banks or oil giants. “We don’t like these blue chips, they never rise much. Your money is just sitting there doing nothing,” Xu said. “I have to come. My heart won’t calm down if I sit at home,” she added. China’s silver-haired investors are said to account for the lion’s share of stock turnover, often at brokerages like Hongta where prices flash in green or red on big black screens. While many younger investors trade via mobile phone, at traditional brokerages elderly punters punch in their orders on boxy 1980s-style computer terminals. Sitting in the rows of plastic chairs and watching the prices flicker is a daily ritual for people like 65-year-old Tang Shunfu. Tang lost around 250,000 yuan over the past three months as markets whipsawed. His family eventually demanded that he pull out, which he did last week. But he still comes regularly to keep an eye on prices. “I need to come and keep an eye on it. I’m not beaten. I want to make my money back,” Tang said animatedly.

Costa Rica to deepen links with China

Wed, 02/07/2018 - 17:01
COSTA Rica aims to strengthen e-commerce links with China and participate in the Belt and Road Initiative to enhance bilateral trade and investment, the country’s trade minister said yesterday. Alexander Mora, the foreign trade minister, said he will talk with Chinese trade and customs authorities, e-commerce companies, and attend business events to boost economic links between Costa Rica and China during his three-day visit. He will propose to the Chinese government the exploration of infrastructure construction opportunities in the country and also consider Costa Rica as a hub for the BRI in the Caribbean region. Mora said Costa Rica is a very active proponent in the World Trade Organization's use of e-commerce as an instrument for growing trade, and he is keen to work with Chinese trade and customs authorities to streamline policies to boost cross-border e-commerce. The country welcomes Chinese e-commerce companies to set up logistics facilities and conduct trade. Agriculture and industrial products, including electric, electronic and medical devices, make up more than half of Costa Rica’s total exports. “E-commerce can be an important link among three agendas including trade, digital and development,” Mora said. “E-commerce can bring benefits to consumers and small and medium size enterprises.” He said the development of e-commerce requires huge investment in infrastructure, which is in line with the essence of the BRI. Costa Rica is building a new port on the Caribbean Sea coast that would cost US$1.4 billion, according to Mora.

Increase in wealth management products

Wed, 02/07/2018 - 17:01
The outstanding balance of wealth management products issued by Chinese banks continued to rise in the second half of 2017, despite increased regulatory scrutiny on the market since early last year, according to a latest report from Fitch Ratings.Total wealth management product issuance rose 3 percent to 173.6 trillion yuan (US$27.7 trillion) between January and December. As of the end of last year, the outstanding wealth management products gained 2 percent annually to 29.5 trillion yuan, equivalent to around 36 percent of the country’s gross domestic product, the report said.Fitch said the outstanding balance increased 4 percent in the second half last year, with the slowdown being “significant” compared with the annual growth of 24 percent in 2016 and a compound annual growth rate of over 50 percent from 2011 to 2015.Joint-stock commercial banks again led the wealth management products market with 40.5 percent, despite a 2 percent decline in their product balance at the end of 2017. City commercial banks' wealth management products balance grew again in 2017, up 7 percent.Fitch said the resilience of overall issuance underscores that it would be difficult for the authorities to reduce activity, given that it represents nearly 17.5 percent of system bank deposits and around 40 percent of joint stock bank deposits.The report said that the authorities have made “some success” in curbing associated contagion and liquidity risks, by engineering a noticeable 51 percent drop in inter-bank wealth management product investment from early 2017.The incentives for banks to invest in relevant products fell considerably, as inter-bank market rates increased due to tighter liquidity as part of the regulatory clampdown, and banks that fund themselves in the inter-bank market are no longer able to make a profit by reinvesting in wealth management products.The report said that a more aggressive crackdown would have the potential to disrupt financial markets and trigger disorderly deleveraging, as 8 percent of wealth management products are invested in government and quasi-government bonds, 34 percent in financial institution and corporate bonds and 16 percent in non-standard credit assets.

Forex reserves rise again

Wed, 02/07/2018 - 17:01
CHINA’S foreign exchange reserves rose for the 12th straight month to US$3.16 trillion at the end of January, official data showed yesterday. The amount was slightly below the market forecast of US$3.17 trillion, and was US$21.5 billion up from the end of December, according to the People’s Bank of China. A statement from the State Administration of Foreign Exchange attributed the increase to stronger non-dollar currencies and higher asset prices. Cross-border capital flows and transactions remained stable in January, it said. China’s forex stockpile has increased steadily since February 2017 after dipping below US$3 trillion in January, as the economy got on a firmer footing and the yuan continued to stabilize. The reserves will continue to maintain overall stability in future, SAFE said, citing positive economic fundamentals and a recovering global economy. It predicted a more balanced forex supply and demand, noting that the yuan’s exchange rate would see more “two-way movement.” “As cross-border capital flows became more balanced, the administration returned to a neutral macro-prudential policy,” Pan Gongsheng, head of SAFE, wrote in an article published yesterday. “The administration will continue to support legal cross-border fund outflows and inflows while cracking down on illegal flows,” Pan noted. He said SAFE would adopt a rational perspective on changes in forex reserves and target a “dynamic equilibrium” in international payments.

Online-offline retail alliances: Who benefits?

Wed, 02/07/2018 - 17:01
IN retailing, size matters. And despite all the hoopla about the online retailing craze, brick-and-mortar businesses in China still overshadow their cyber rivals in overall sales. With growth in online consumers slowing, Internet giants are venturing deeper into offline retailing. “Investment by Internet giants in the offline retail sector will continue this year,” Shi Jialong, head of Internet research at Nomura Securities in China, predicted. “Online companies are eager to bring in new business.” But does all this so-called “synergy” really work? “Brick-and-mortar stores have limited means to gather information about shoppers and their preferences, so leveraging the data capability of Internet companies might be a good idea in the online-offline tie-up,” he added. But the theory has yet to prove itself very successful in the real world of retail. In 2014, Wanda Group, China’s largest commercial property company, the world’s largest cinema chain operator and an operator of luxury hotels, department stores and tourism projects, formed a venture with leading Internet companies Tencent and Baidu to pursue online and offline synergies. But to date, the tripartite partnership hasn’t delivered fruitful results. Wanda’s e-commerce affiliate Feifan has made few inroads in the retail market, and Tencent and Baidu, which each hold a 15 stake, have been reluctant to pour more resources into the venture. Wanda, however, seems undaunted. Last month, a group of investors led by Tencent agreed to pay 34 billion yuan (US$5.4 billion) for a 14 percent stake in Wanda Commercial Properties Co. The investment group included online retailer JD.com, Sunac and Suning Holdings. The deal was dubbed “strategic,” but doubts have been raised about its ultimate goals. Analysts said it may help Wanda Commercial, which has been experiencing cash flow problems and delays in securing a listing on the Shanghai Stock Exchange after it delisted from the Hong Kong bourse in 2016. Commercial titans For Tencent, the benefits may be less obvious. Analysts noted that China’s Internet giants, in their zeal to become commercial titans, are putting their fingers in an increasing number of pies. Alibaba Group has already entered the realm of grocery and departments stores, using its technology to reshape retailing. Tencent isn’t far behind. It and Yonghui Superstores Co, in which it holds a stake, plan to take a minority stake in French retailer Carrefour’s China unit. And it isn’t surprising that Tencent wants to parlay its technologies like digital payments into smart retailing methods. Alibaba’s Alipay and Tencent’s WeChat Pay altogether accounted for 93 percent of China’s mobile payment segment by the end of last September, according Internet consultancy Analysys. Details of the Tencent-Carrefour linkup haven’t been revealed. Carrefour, which has 200 physical outlets in China, has been suffering from an erosion of customers to online shopping. Yonghui has about 600 brick-and-mortar stores. “The potential investment will leverage Carrefour’s global retail knowledge with Tencent’s technological excellence and Yonghui’s operational know-how, in particular its expertise in fresh foods,” said a statement from Tencent and Yonghui. Nomura’s Shi said it could take a while for collaboration between online and offline retailers to show results. Internet players usually hold minority stakes in retailers, he noted, which makes it harder for them to drive transformation toward digital business models. Tencent’s social platform WeChat, which launched a “pop-up store” in the MixC shopping mall in Minhang District, has teamed up with EasyGo, a Guangzhou-based convenience store operator. The “pop-up store” is a trial to test the waters following Alibaba’s ambitious expansion into offline retailing in recent months. The cashier-less store, called We Life, admits consumers who scan a barcode with a WeChat app and register their mobile phones with EasyGo. Merchandise inside is embedded with radio frequency identification chips to record purchases. The store has not been an instant success. “Why would I bother go to this self-service store when I can purchase my daily necessities easy enough from other convenience stores?” said Shanghai office worker Tammy Jiang, who visited the “pop-up” store near her home once. “It’s too much trouble to check what kind of products are actually available in the store and what if some of the products are out of stock?” For many consumers, the joy of shopping is more about browsing in pleasant surroundings than having to deal with tech gadgetry and digital payment systems. A senior executive with Publicis Groupe told Shanghai Daily that self-service supermarkets and even cinemas will eventually become omnipresent as more consumers adjust to undisturbed service with maximum privacy. While Internet companies are expanding to the offline realm, she noted, the customer experience, whether it be a social atmosphere or human-based customer service, is what matters most in the game of marketing. ‘Smart’ retailing Another Internet giant, JD.com, is seeking to innovate in offline retailing with its JD Daojia Go unmanned “smart” vending machines, which have been installed in office buildings in 10 mainland cities and is eyeing further expansion in the coming year. JD Daojia said its logistics network and its merchandising reach offer advantages to help the company to stay closer to the tastes of shoppers. That is one big difference between online and offline sellers. Brick-and-mortar stores generally have little idea of the profiles of their shoppers, while Internet companies are experts at tracking customers and their preferences. Offline retailers are now trying to leverage the one advantage they do have: a shopping experience that can’t be replicated online. To that end, they are trying to upgrade stores to make them more special, diversified places. Super Species, a Yonghui Supermarket subsidiary that focuses on fresh seafood and fruit, aims to add 100 stores to the 34 outlets it already operates nationwide. At least a dozen new openings are expected in Shanghai this year. Its strategy of combining a fresh food market with dining areas has been successful. The stores are linked with Tencent’s payment system to allow easier tracking of merchandise and shopper preferences. Suning Commerce Group is also trying to diversify its brick-and-mortar stores with the addition of 300 physical outlets in Shanghai this year. They will include specialty shops, such as baby and maternity products, sports and fresh food outlets.

Transmission link sets record

Tue, 02/06/2018 - 17:01
Aerial photo taken yesterday shows the construction at the south bank of the Yangtze River of the Changji-Guquan ultra-high voltage direct current transmission link in Digang Town under Fanchang County in Anhui Province. The 1100kv Changji-Guquan transmission link will set a world record in terms of voltage level, transmission capacity and distance. The link is expected to be finished this year with an installation capacity of 12,000 megawatts.

Recyclers wrestle with making waste pay

Tue, 02/06/2018 - 17:01
BROWSING my phone, an app’s advertisement caught my eye as it promised a door-to-door collection service for used goods. I was glad I could wait at home to have my used appliances and furniture recycled rather than hunting for an agent to help. But tracing the link to visit the app, I was told its services had been suspended “as the company needs to adjust its business.” “We have to find some other work which can make profits, planning to put forward new services such as clothing and book recycling later this month,” said founder Xu Liang, general manager at Shanghai Tianying Environmental Technology Co. “We can’t hold on after four months’ losses.” Unfortunately, that scenario might be common with China’s online recycling startups. Before Xu’s Shanghai-based app, named Duansheli — a Chinese transliteration of the Japanese word Danshari, which means to separate from useless goods — suspended its services at the end of last year, its rivals such as 9beike in Hangzhou went bankrupt in 2016 after one year’s operation, while Zaishenghuo in Beijing had struggled into an online housekeeping service provider from a recycling business to stop losses. “We haven’t seen a successful case by now,” said Zhang Chu, vice president at Leading Capital who is specialized in environmental industry investment. After five years’ work there, Zhang has not invested in any project relevant to recycling, “as there hasn’t been a practical profitable model, let alone trials among startups.” Two to three years ago, the Internet seemed to be a savior for China’s stagnating waste sorting and collecting industry, with online service providers emerging across the country in line with the soaring number of computer users. Tan Biao, founder of 9beike.com, the “poster child” winning US$5 million of angel investment when it was created three years ago, said: “We’ve met the right time for recycling and waste sorting” after the fundraising. Misread or too early? But after falling apart in such a short time, did those recycling “geeks” misread China or were they just too early? Xu would disagree he misread China. Teaming up with five colleagues six months ago to work on waste sorting and recycling, they were sure “our products need to adopt digital technologies as a way to reach young people,” said Lu Jingxuan, Xu’s partner specialized in marketing and communications. They do have some reason, given that their platform attracted 15,000 users in two months. 9beike was also applauded for attracting 100,000 users in three months when it started. “Because it helped me treat my used goods in an easy way with some rewards, both materially and spiritually, rather than throwing it away,” said one of its users in an interview. While in the old days junkmen had to stay in one spot at a fixed time to collect used goods, “nowadays we can gather enough orders before sending workers to pick up goods at different communities,” Xu said. “And it turns out they like this way.” Apart from being able to place orders anytime at any place rather than looking for a waste collecting station, smartphone apps also made users more interested as they could be repaid either in cash or “credits” to exchange for goods such as movie tickets and supermarket coupons. Meanwhile, they broke with the traditional publicity which the government has used for a long time to educate residents, normally in collaboration with local communities to put up some posters or to broadcast some videos. “That has limited influence as such measures only affected old people and kids who can stay at home in the day time, not the young people working day and night in office buildings,” Lu said. “Only the young are the main force to change the whole society’s mentality, and this time we’ve reached them by delivering messages on mobile phones and websites,” he added. But what made things go wrong even after such apps reached their target audience? “They can’t even break even if there is no source of fundraising,” Zhang said. “The recycling business itself can hardly make a profit, dragged by costly logistics and treatment expenses.” One common conundrum of these platforms is the high operational cost due to scattered, small-scale goods. In 9beike’s case, their workers had to collect goods every time the platform received orders across the city, “leading to high logistics costs,” said Yang Gaoxiao, its marketing director. “But the value of every order was too low, as citizens have limited goods to throw compared with firms and shops.” Meanwhile, many online recycling startups such as 9beike are more Internet companies than waste disposal companies, and lacked the ability to treat waste, “thus having to partner with companies which are willing to treat the waste, causing another large sum of expense,” Yang added. Costly logistics Xu’s startup, by contrast, has treatment support from parent company China Tianying Inc, one of China’s largest waste disposal and energy groups. It had 1 billion yuan (US$159 million) in sales last year in its main business of incineration — which makes a profit by burning waste to produce electricity. But still, Xu found the logistics expensive “if you receive all kinds of used goods.” “But if you narrow it down to some specific lines such as household appliances, you will receive too few orders to maintain business,” he said. One possible measure to lessen the logistics costs is to collaborate with local community centers, “thus able to summon residents to hand in goods in a batch rather than letting them place orders separately.” But the question is: “How to persuade community centers, namely government? Do they have the budget to support such work?” said Zhang. The subsidy the government needs to cover includes not only rewards for residents to hand in goods, but also the expense of teaching them how to sort goods. In Shanghai, over 57 tons of waste paper and 87 tons of plastics were wasted every day on average in 2014 as citizens mixed them into kitchen garbage, said the city’s greenery and public sanitation bureau in a report. “Citizens are still confused about how to sort waste after the government changed sorting standards four times in 17 years,” said Zuo Yan, Chairperson of Huangpu District Committee of the Chinese People’s Political Consultative Conference. “The government is also mulling how to build a wholesome recycling system.” Whether online recycling companies can succeed relies far more than how good they are at such business, Zhang said. “If you aim to make profits from the business itself, you’d better recycle some high-value goods such as precious metals; they can turn into higher prices after processing,” he said. “But most of the recycled goods can only sell at lower prices even though you put higher efforts to realize their new use.” The next question is, how to persuade the public into paying for the additional efforts? Nantong in eastern Jiangsu Province, the city where China Tianying is based, has proposed to allocate 20 yuan for every household per month to sort their waste and used goods and hand in them to the company. “That’s one of the ways to address the issue,” Zhang said. “And after all, the recycling forerunners may have to wait until the whole society realizes that it has to pay for their business, rather than simply enjoying what the digital technologies have brought to daily life.”

Rapid growth of NEVs poses big test to battery recycling in China

Tue, 02/06/2018 - 17:01
EXPLOSIVE growth of new energy vehicles in China will pose a great challenge to battery recycling, a downstream industry that has not kept up with the sharp expansion of plug-in autos. China’s new energy vehicle market recorded another year of rapid growth in 2017 as the government continued its strong push for green transport. New energy vehicles refer to vehicles powered by non-traditional fuel, for example, electric and hybrid vehicles. A total of 777,000 new energy vehicles were sold in the Chinese market last year, up 53.3 percent year on year, according to the China Association of Automobile Manufacturers. The growth was 0.3 percentage points faster than in 2016, when China sold more new energy vehicles than anywhere else for a second year. New energy vehicle output jumped 53.8 percent to 794,000 units last year, according to CAAM. The stock of new energy vehicles is the world’s largest, with 1.53 million by the end of 2017. According to Shenzhen Gaogong Industry Research Co Ltd, in 2016, there were about 12,000 tons of car batteries that needed recycling, and the figure is expected to jump to 248,000 tons by 2020. “The number of batteries that need to be recycled will climb very fast after 2018,” said Bai Min, an assistant researcher at the Center For International Economic and Technological Cooperation. Lithium batteries, commonly used by new energy vehicles, pose less hazard to the environment compared with lead-acid cells. Copper, cobalt and nickel in the batteries also have high recycling value. “Lithium is in high demand, and for example can be used for rechargeable laptops and mobile phones. There is money to be made from a used battery,” Bai said. While the new energy cars’ environmental benefits are clear, they come with certain challenges. Zhang Zheming, assistant researcher with Shenzhen Institutes of Advanced Technology, warned that the used batteries pose hazards if mishandled. “If car batteries are not properly handled they may explode. Acidic substances that are needed to process the batteries are also hazardous to humans and may pollute air and soil,” Zhang said. But China’s battery recycling industry has not developed in tandem with the auto industry, said Zhang Changling, senior engineer of China Automotive Technology And Research Center. “Many recycling companies are still using old ways, like taking down the parts manually, which have great safety and environment risks,” Zhang Changling said. “Certified recyclers are still lacking.”

Well-off families bullish on economy

Tue, 02/06/2018 - 17:01
CHINA’S moderately well-off families are optimistic about the Chinese economy in the future as the Climate Index of China’s Wealth rose in January amid steady economic growth, a Bank of Communications report said yesterday. The bimonthly index hit 140 points in January, up 3 percentage points from two months before and was 6 percentage points higher than that in January 2017, said the report released by BoCom. A reading above 100 means growth in wealth, while that below 100 signals retreat. All three main sub-indices rose, with that for income growth up markedly by 5 percentage points to 155. The economy climate index added 1 percentage point to 137, and the investment intention index gained 2 percentage points. “The growth of these indices showed that well-off families are optimistic about the Chinese economy in the future,” said Zhou Kunping, deputy general manager of the research and development department at BoCom. China is working hard to drive its economy into one of high quality development, with the gross domestic product exceeding 80 trillion yuan (US$12.8 trillion) for the first time in 2017. This boosted people’s confidence in the economy, and helped lift the overall climate index of China's wealth, the report said. “The 5-percentage-point rise of the sub-index for income growth was to some extent due to the improved household finances,” Zhou said. "Also, the strong performance of stocks in the beginning of the year buoyed returns on investment.” The investment willingness index rose amid people’s intention to invest in current assets, confident their investment would be protected by stricter rules, the report said. BoCom surveyed 1,800 well-off families with annual after-tax incomes above 120,000 yuan in Beijing, Shanghai, Guangzhou and Shenzhen, those with incomes over 100,000 yuan in Chengdu and over 80,000 yuan in 21 other cities.

PBOC aims to enhance rules framework

Tue, 02/06/2018 - 17:01
CHINA’S central bank said yesterday it would improve the framework of regulation underpinned by monetary policy and macro-prudential policy in 2018. The improvements will be made partly by stepping up supervision over shadow banking and real estate finance to fend off financial risks, according to a statement of the work conference of the People’s Bank of China. Such a regulation, known as a “two-pillar” policy framework, was established in 2017 to better dissolve systemic risk and ensure financial stability. Under the system, liquidity has becomes more stable, cross-border capital flow more balanced and off-balance sheet wealth management products better supervised. The PBOC also said it would keep a prudent and neutral monetary policy, and direct more capital into key economic areas, such as rural vitalization and poverty relief. More efforts will be made to improve disposal of bond defaults, and unify rules on approval and information disclosure of corporate credit bond issuance. The central bank also listed financial services in home rentals, establishment and improvement of a long-term mechanism on supervision over online finance and on risk prevention, and opening up of the bond market as important tasks this year.

Booming demand for online courses

Tue, 02/06/2018 - 17:01
ONLINE courses covering language learning, psychology, photography, design and those that help prepare candidates to sit for civil service examinations are booming in China, Shanghai-based online education platform Hujiang said yesterday. In 2019, China’s online education market is set to generate 272.7 billion yuan (US$43.5 billion) in revenue, up from 194.1 billion yuan in 2017, according to research firm iResearch. More than 30,000 “cyber teachers” have opened online courses on Hujiang’s platform which serves around 10 million users now. About 20 percent of the teachers — some working part-time — are able to earn over 100,000 yuan annually, according to a Hujiang report. Hujiang, which used to focus on online language learning, found a “huge market potential” for non-language courses. On Hujiang’s platform CCTalk, courses on Korean, Japanese and children’s English now take up less than half of the total courses, said Fu Cairui, CEO and chairman.

‘Panic over’ as Dow stabilizes day after plunge

Tue, 02/06/2018 - 17:01
A collective sigh of relief swept across global trading floors yesterday as bargain hunters swooped on Wall Street stocks, stemming a hemorrhage that had been spreading panic among investors. With Asian and European equity markets plunging, New York stocks started their trading day with another jaw-dropping fall as the Dow index dived nearly 3 percent, adding to Monday’s record-breaking loss. But within minutes a fierce battle seemed to be playing out between those betting on a further downturn and those who thought that the market correction had gone too far, leading to some wild price swings. “Traders don’t know which way to turn as uncertainty is running high,” said David Madden, market analyst at CMC. “The colossal range on the US indexes sum up how irrational equity traders are at the moment, and while some go bargain hunting, others are fearful we could see another leg lower.” Even as the Dow index gyrated in and out of positive territory, the feeling spread that the worst of the a brutal downturn was over. “Dow up! Panic over, as you were everyone,” tweeted James Hughes, chief market analyst at AxiTrader. Jasper Lawler, head of research at London Capital Group tweeted “Trader’s paradise out there right now”, in a reference to volatility which boosts brokers’ earnings. European stock markets were helped off the day’s worst levels by the Wall Street recovery, but remained deeply in the red at the close. The sell-off began last Friday when bright US non-farm payrolls data sparked fears that inflation will surge this year — and that the Federal Reserve will be forced to raise borrowing costs more quickly than anticipated. Earlier yesterday, Tokyo stocks led a collapse throughout Asia, briefly diving almost 7 percent before closing down 4.7 percent. The Shanghai Composite Index fell 3.35 percent to close at 3,370.65 points. Hong Kong lost more than 5 percent in its worst day since summer 2015, while Sydney and Singapore each sank 3 percent. New York’s Dow Jones Industrial Average saw its steepest ever one-day point drop on Monday, shedding a total of 1,175.20 points or a hefty 4.6 percent in value, while the S&P 500 sank 4.1 percent and 10-year US Treasury yields set four-year peaks. The last fall of that size came in August 2011 when investors were fretting over Europe’s debt crisis and the debt ceiling impasse in Washington that prompted a US credit rating downgrade. The downturn was so rapid that some investors wondered whether they were headed for a crash, but others welcomed what they saw as a reality check for an overbought market. “It’s not doom and gloom, and it’s not financial markets Armageddon; it’s just a much needed and much overdue correction,” said AxiTrader’s Hughes. Analyst Naeem Aslam at trading firm ThinkMarkets said: “Markets usually grind to the upside, but fall like a rock. “Traders have been looking at the market for the past year moving in one direction which was skewed to the upside. Now, it’s time for the bears to take their revenge.” Prior to this week’s chaotic sell-off, Wall Street had enjoyed an impressive record-breaking run ever since Donald Trump’s 2016 election on hopes over the US president’s pro-business tax-cutting policies. Asia and Europe had meanwhile reaped bumper gains from the improving economic outlook. “If investors had been waiting for an opportunity to take profits, the prospect of higher than expected inflation and tightening by the Fed provided just that,” said Richard Hunter, head of markets at online stockbroker Interactive Investor. “Rising interest rates, whilst potentially good news for savers, increase the cost of borrowing and the possibility of loan defaults,” he added. “Mixed in with that, higher bond yields could increase the attractiveness of bonds as an investment destination, some of which will be at the expense of equities.” On currency markets the yen, considered a go-to unit in times of turmoil and uncertainty, climbed against the dollar. Bitcoin continued its spiral downward after some banks banned their customers from buying it with credit cards. The news is the latest to hit the cryptocurrency after recent crackdowns by authorities in China, India, South Korea and Russia.

C919’s 1st delivery eyed for 2021

Tue, 02/06/2018 - 17:01
THE Commercial Aircraft Corp of China Ltd yesterday said it was aiming to make the first delivery of its C919 single-aisle jet in 2021, despite delays in flight testing. Lu Zheng, COMAC’s deputy general manager of sales and marketing, said on the sidelines of the Singapore Airshow that the company expected Chinese certification to take three to four years. COMAC also has been speaking to US authorities. “It should not have any impact” on the delivery time to the jet’s launch customer, China Eastern Airlines, he said. “We’re striving for 2021.” The C919, which hopes to compete with Boeing Co’s 737 and the Airbus SE A320, is a symbol of China’s civil aerospace ambitions and President Xi Jinping’s push to upgrade manufacturing capabilities. There was an almost five month-gap between the C919’s first and second flight, far longer than that of other new aircraft, which had raised concerns that COMAC’s plans to deliver the aircraft were running behind schedule. The plane has since undergone multiple tests, including a long-distance flight. Lu expects US and European certification to come after it wins approval from Chinese regulators. Europe’s aviation safety regulator has started the certification process, but its US counterpart has not, he said. He described recent partnerships between Airbus and Bombardier, as well as Boeing and Embraer as “normal,” but said that they would affect the markets its C919 and ARJ21 planes want to compete in. “It will have an impact but they’ve also been impacted by us,” he said. “We will work hard to become, from a follower, to be a competitor, and in future, if we have the opportunity, to become a leader. But it’s a long road.” The company does not plan to announce any orders at the Singapore Airshow, he added. But it planned to speak to potential customers from Southeast Asia. The company, which is also co-developing a new wide-body jetliner with Russia, said in a statement that it had asked engine makers for proposals to supply the C929 jet’s propulsion system on December 21. Russian officials have said the two countries expect to develop their own engine for the project.

Shanghai targets help for enterprises

Tue, 02/06/2018 - 17:01
THE Shanghai government has worked hard to improve the business operating climate for enterprises by unveiling targeted policies and measures, improving its work efficiency and providing accurate services, local officials said yesterday. To speed up project completion has always been a key task for the local administrative examination and approval office. The authority has carried out four rounds of reforms to optimize the investment system and reduce approval management issues for construction projects, Jin Yueming, deputy director of the Shanghai Office of Agency and Staffing Committee said. Meanwhile, the government has been exploring new and innovative initiatives to quicken project completion by implementing special reform pilot programs in the original comprehensive bonded zone, the Expo park, chemical industry zones and Fengxian District, and then promote and replicate successful experiences to other areas in the city. In 2017, Shanghai revised and optimized its project administrative examination and approval processes and introduced a new administration program for enterprises that invest in technology transformation projects. Through those reforms, the time for administrative examination and the approval of industrial projects has been trimmed by one third compared with the stipulated time, with the time required for some projects reduced by as much as half. In the past year, the city also made reforms to boost its work efficiency by providing spot responsive servicing. The policy requires that administrative departments should help resolve problems from the public on the spot, as long as they can make a quick decision. So far, over 20,000 requests have received spot responses, the government said.

Boeing eyes tie-up with Embraer

Tue, 02/06/2018 - 17:01
BOEING Co has presented a plan to Brazil’s government that would give it an 80 to 90 percent stake in a new venture encompassing Embraer SA’s commercial jet business, a Brazilian newspaper said yesterday. The plan Boeing presented to the government on Thursday would let it take over Embraer’s commercial operations via the creation of a new company, with defense operations remaining under the Brazilian planemaker’s control in order to meet government demands, Valor Economico reported, without citing a source. Reuters previously reported on Friday that Boeing was seeking approval in Brasilia for a plan creating a new joint company excluding defense operations. Valor reported that under the proposal Boeing would pay Embraer in cash when the commercial assets are transferred to the new company, with most of the proceeds then distributed to shareholders as dividends. Boeing’s tie-up with Embraer, the world’s third-largest planemaker, would give it a leading share of the 70- to 130-seat market, meaning stiffer competition for Bombardier Inc and Airbus SE’s joint CSeries program. Embraer would retain the defense business that generates almost nothing in earnings before interest, taxes, depreciation and amortization. Shareholders would also have 10 to 20 percent of the commercial activities transferred to the new company and be entitled to dividends. The deal would maintain the government’s so-called golden share in Embraer, a former state enterprise, giving it veto power over certain strategic decisions, including Boeing’s current push for a tie-up. The plan — if supported by the government and Embraer — could be presented to shareholders for approval as soon as the second quarter, the newspaper said. Further meetings between Boeing and the government will not occur until after the Carnival holiday, which ends next week, it reported. Boeing and Embraer did not immediately respond to requests for comment.

Sales of FMCG surge 4.3%

Tue, 02/06/2018 - 17:01
CHINA’S sales of fast moving consumer goods, such as packaged food, beverage and cosmetics, recorded the highest annual growth in three years in 2017 at 4.3 percent, with online sales volume rising 29 percent, according to Kantar Worldpanel. Retailers are adopting new methods to catch up with the digital transformation, with the combined sales volume of hypermarket, supermarket and convenience stores rising 2.6 percent, from 1.6 percent growth a year ago. Most multinational and local retailers have strengthened their foothold with new store openings or business formats through tie-ins with Internet companies. Sun Art Retail Group, which runs Auchan and RT Mart malls, remains the biggest player by sales, lifting its market share to 8.4 percent from 8.1 percent a year ago. Yonghui recorded the fastest growth with new formats such as Super Species and community stores. It overtook Carrefour as the fourth largest retailer, with a market share of 3.3 percent. About 60 percent of Chinese families have purchased fast moving consumer goods online, and in Beijing, Shanghai, Guangzhou and Chengdu, that figure is nearly 70 percent.

Elevator sales to rise 15% in 2018

Tue, 02/06/2018 - 17:01
SALES of elevators in China will rise by 15 percent in 2018 from a year ago because of a rally in the real estate industry two years ago, Nomura predicted yesterday. “Sales of elevators are normally met two years after homes are constructed, thus indicating a rebound this year as there was a rally in the realty market in 2016,” said Patrick Xu, Nomura’s industrial analyst. He expected the homes to be completed in two years. China sold 1.57 billion square meters of homes in 2016, up 22.5 percent annually, while its gross floor area added 7.59 billion square meters, 3.2 percent higher from 2015, according to the National Bureau of Statistics.

Year of the Dog tips for HK market investors to lap up

Mon, 02/05/2018 - 17:01
STOCK markets are expected to get off to a bouncing start in the Year of the Dog but investors might want to sniff around for value a bit later, Hong Kong brokerage CLSA said in its astrological predictions for the 2018 lunar year. CLSA’s Feng Shui Index, a tongue-in-cheek financial forecast for the Year of the Dog which begins on February 16, forecasts “a most auspicious day” on February 28, although it warns of a “summer of discontent.” The CLSA report, which cautions investors not to “bite off more than they can chew,” draws on findings from a Hong Kong feng shui master, who looks at the five elements in Chinese astrology: wood, metal, earth, fire and water. “It’s not a year for metals to bark so don’t expect much more than a whimper from banks and financials — we expect both to underperform from the previous two years,” CLSA said. “There’s just enough earth in the charts to keep property and renewables anchored,” it added — in Chinese astrology 2018 is the year of the Earth Dog. September is a good time to hound down smart investments, with sectors such as health care and consumer, seen as wood-related, among the top picks for the year. A lack of metal element this year may see auto and machinery stocks underperform. CLSA advises against taking bets on casino or transport stocks in March, when the market is likely to take a tumble, although these sectors should get a leg up in October. Construction and resources stocks are expected to bloom from spring to mid-summer, but investors are told to be wary of banking and financials. The Hang Seng Index is expected to close on a high at the end of the year, it says. Hong Kong got off to a strong start of the calendar year, scaling a series of record highs, although the past few trading sessions have been volatile, tracking moves in global equities. The financial hub’s benchmark index has risen around 7 percent so far this year after surging 36 percent in 2017.

China plans to stamp out all crypto trading

Mon, 02/05/2018 - 17:01
CHINA plans to stamp out all remaining cryptocurrency trading in the country by blocking access to overseas-based websites and removing related applications from app stores. The moves were outlined in a report on Sunday by Financial News, a publication under the People’s Bank of China, which said the aim was to snuff out the “dying cinders” of cryptocurrency trading and initial coin offerings “which are glowing once more.” Faced with Chinese citizens who continue to trade cryptocurrency on platforms operated beyond the country’s reach, or take part in initial coin offerings, authorities will “ratchet up oversight in a sustained manner,” the report said. After launching a campaign last year, authorities eliminated most cryptocurrency trading in the country. China’s share of trading plummeted from 90 percent of the world to below one percent, the report said. That crackdown sent Chinese cryptocurrency traders to overseas platforms operated in Hong Kong and Japan. The latest regulatory moves aim to cut off access to them. Financial regulators will work with telecommunications regulators to shut down websites and mobile apps offering trading in illegal initial coin offerings, the report said. Regulators will also take unspecified action against websites of foreign and domestic cryptocurrency trading platforms. The PBOC has also ordered operators of payment systems to launch a “rectification” campaign and ensure their tools were not being used to funnel money into cryptocurrency trading. The report added a warning to any companies within China providing services to ease trading. “This is not in line with what is stipulated in the current policies,” it said. The international value of Bitcoin and other cryptocurrencies have plunged this year amid fears of a crackdown in Asia and concerns that many currencies’ rapid rise in value last year could reflect an bubble.

Ex-investment banker Powell sworn in as Fed chair

Mon, 02/05/2018 - 17:01
FORMER investment banker Jerome “Jay” Powell was sworn yesterday as the 16th leader of the US Federal Reserve, taking a key role in overseeing the world’s largest economy. Perhaps the wealthiest Fed chair ever, Powell, 65, takes the reins of monetary policy just as a decade of economic recovery has begun to crest, and as analysts are pointing to challenges on the horizon. Powell said he was committed to explaining the Fed’s policy moves, a signal likely to be welcomed by conservative lawmakers who have called for the central bank to follow strict formulas in setting interest rates — a requirement Fed officials have opposed. Powell also said the banking reforms enacted since the 2008 crisis made the financial sector stronger. “We intend to keep it that way,” he said in comments after taking the oath of office. But he struck a note of balance, perhaps a nod to the Trump administration priority to reduce regulatory burdens in the economy. “We will also work hard to make sure that our regulation and supervision are efficient as well as effective,” Powell said. “At the Federal Reserve, we know that our decisions matter for American households and businesses.” Powell joined the Fed as a governor appointed by then-President Barack Obama in 2012, the year the Fed adopted a two percent target for annual inflation. Inflation has run below target since then, allowing former Chair Janet Yellen to leave the post amid low price pressures, steady growth and rising employment. Despite her solid record, Yellen, the first woman to lead the Fed, became the first Fed chief in four decades not to be reappointed to a second term. Powell, who is not an economist, takes over just as fears arise about fiscal pressures following December’s massive tax cut and concerns inflation may finally be poised to heat up. The new Fed chief is likely to make the first of regular public appearances in the usual semi-annual testimony before Congress later this month, followed by his first press conference after the March policy meeting. The Fed said in December it expects to raise the benchmark interest rate three times this year, and the first move is widely set to come in March.

New home sales dive as festival approaches

Mon, 02/05/2018 - 17:01
NEW home purchases fell notably in Shanghai last week as the weeklong Spring Festival holiday is just around the corner. The area of new homes sold, excluding government-subsidized affordable housing, plunged 37.5 percent from the previous seven-day period to 127,000 square meters, Shanghai Centaline Property Consultants Co said in a report released yesterday. The remote Chongming District emerged as the best performer with transactions almost tripling amid abundant supply. Around 37,000 square meters of new homes were sold in the island district, a week-over-week surge of 184.6 percent. It was most closely trailed by Nanhui in Pudong New Area where new home sales hit 18,000 square meters. The average cost of new homes added 2.9 percent from the previous week to 40,322 yuan (US$6,383) per square meter, according to Centaline data. “The clock is ticking down as the lunar new year holiday is falling in less than two weeks,” said Lu Wenxi, senior manager of research at Centaline. “Sentiment among both buyers and real estate developers will continue to cool probably through the end of this month.” A newly launched residential development in Chongming’s Changxing Island released 299 apartments, or 30,291 square meters of new homes in total, during the seven-day period ended Sunday. A unit in the most sought-after project of the week costs about 27,562 yuan per square meter.

UK and US banks ban credit card purchases of Bitcoin

Mon, 02/05/2018 - 17:01
BANKS in Britain and the United States have banned the use of credit cards to buy Bitcoin and other “cryptocurrencies”, fearing a plunge in their value will leave customers unable to repay their debts. An LBG spokesman said the ban was across its Lloyd Bank, Bank of Scotland, Halifax and MBNA branded credit cards. In a brief statement, he said LBG does “not accept credit card transactions involving the purchase of cryptocurrencies.” Over the past few days, Bank of America, Citigroup and JPMorgan each introduced the same ban. There is a concern that customers who bought Bitcoin late last year when crytocurrencies in general surged in value have been left with big losses following massive declines in recent weeks. Yesterday, the price of Bitcoin tumbled to US$7,950, two months after breaking through the US$20,000 mark.

Samsung heir freed after winning suspended term

Mon, 02/05/2018 - 17:01
SAMSUNG heir Lee Jae-yong was freed yesterday after a South Korean appeals court gave him a 2 1/2-year suspended jail sentence for corruption in connection with a scandal that toppled the country’s president. The Seoul High Court softened the original ruling against Lee, rejecting most of the bribery charges leveled against Lee by prosecutors who sought a 12-year prison term. While the ruling clears the way for the Samsung vice chairman to resume his role at the helm of the industrial giant founded by his grandfather after a year in prison, he faces a slew of challenges outside prison. Chief among them will be winning trust that he is capable of running South Korea’s biggest company, and assuaging public anger among those who viewed the court’s surprise decision as a setback in the war on corruption. “The past year was a precious time for personal reflection,” Lee told reporters waiting outside the gates of a detention center in southern Seoul. Lee’s first stop from the prison was a Samsung hospital where his father has been hospitalized after suffering a heart attack in 2014. Lee was charged with offering US$38 million in bribes to former President Park Geun-hye and her confidant Choi Soon-sil, embezzling Samsung funds, hiding assets overseas, concealing proceeds from criminal activities and perjury. The appeals court said Lee was unable to reject the then-president’s request to financially support her confidante and was coerced into making the payments.

China’s services activity increases

Mon, 02/05/2018 - 17:01
FIRMER client demand boosted China’s services activity which expanded in January at the quickest pace since May 2012, a private report showed yesterday. The Caixin China General Service PMI rose to 54.7 at the beginning of the year from 53.9 in December, according to the survey conducted by financial information service provider Markit and sponsored by Caixin Media. A reading above 50 signals growth while one below 50 means contraction. The report said new business increased for service providers during the opening month of the year amid reports of firmer client demand. New order growth accelerated to a 32-month record across the service sector, and headcount continued to rise for the 17th consecutive month. Released last week, the Caixin manufacturing PMI for January was flat at 51.5, as in December. The Caixin Composite PMI, which covers both manufacturing and services, rose to a seven-year high of 53.7 from December’s 53, to indicate a solid pace of expansion. “Caixin PMI readings in January showed that the Chinese economy had a good start to 2018,” said Zhong Zhengsheng, director of macroeconomic analysis at CEBM Group. “Looking forward, we should watch for stability of demand in the manufacturing industry and the impact of growing costs on the profitability of service providers.” He added that the input prices sub-index hit the highest since April 2012, due to the impact of rising labor costs and crude oil prices. Meanwhile, the official general PMI, released last week for the first time to track both the manufacturing and services sectors, was flat at 54.6. As data showed, the December reading would have been the same. The manufacturing PMI dipped to 51.3 in January, the lowest since May last year, while the non-manufacturing PMI rose for the third straight month to 55.3. The official PMI survey covers thousands of large and small companies, while the Caixin service PMI measures several hundred. The services sector contributed to over half of China’s gross domestic product in recent years as its economy is being turned from investment-driven to consumption-driven.

Phone vendors may face ‘turning point’

Mon, 02/05/2018 - 17:01
CHINA’S mobile phone vendors face a tough market environment as sales declined and cost of components rose but Nomura Securities said they may face a “turning point” in March. China’s mobile phone sales fell 27.1 percent last year as the market became saturated after experiencing several years of rapid growth, according to the China Academy of Information and Communications Technology, a research arm of the Ministry of Industry and Information Technology. Oppo and Vivo cut their orders for flagship models in 2017. Even Apple’s iPhone X sales in December in China were at only half of expected sales. Meanwhile, the cost of advanced components for memory, sensor and screen, especially in high-end models with the latest technologies, has jumped . But upgrading hardware such as bigger memory may not impress consumers so much, and these two factors put huge pressure on vendors and down-stream suppliers, said Donnie Teng, a Nomura analyst. But the “turning point” may appear in March when domestic brands are slated to launch new models. The most promising ones are under-screen fingerprint recognition and 3D sensing developed by Huawei and Xiaomi, he said.

SMEs to see more obstacles

Mon, 02/05/2018 - 17:01
GROWTH for small and medium Chinese enterprises slowed in January, Standard Chartered said, adding that they are slated to face more obstacles in the near future. The Small and Medium Enterprise Confidence Index, released by the UK-based bank, fell to 53.8 points in January from 55.3 points in December 2017, while the SME growth momentum index also reversed from 11.2 points to 9.8 points. The present situation index and expectation index also dipped, indicating that SMEs were likely to confront a weaker growth trend in the first quarter, the bank said in a report. “The decrease in demand is dragging on production, and the willingness of SMEs to invest remains low,” Shen Lan, economist of Standard Chartered China, said. “The first quarter of 2018 is expected to see more obstacles including the decline of investment and production while stricter regulations will lead to slower growth in (China’s) gross domestic product,” Shen said.

Survey on consumer spending

Mon, 02/05/2018 - 17:01
Chinese born between 1970 and 1979 continued to be the main contributors to consumption, according to a report on the latest trend of domestic consumption done by China Unionpay and JD Finance, the financial arm of major e-commerce behemoth JD.com.The survey, which randomly selected 400,000 active users of the two companies and tracked their behavior of consumption during the past three years, revealed that those born in the 1970s contributed nearly half of the total daily consumption of the 1970s, 1980s and 1990s in the past three years.Those born between 1980 and 1999 saw a rapid growth of spending during the three years, doubling the spending of people born in the 1970s. The survey also showed that money spent through mobile and Internet channels took up over half of their daily consumption expenditure.

Stake buy to develop Wanda Film

Mon, 02/05/2018 - 17:01
ALIBABA Group said yesterday it has joined Shanghai-listed TV and film production firm Cultural Investment Holdings Co to acquire a 12.77 percent stake in Wanda Film Holding for 7.8 billion yuan (US$1.2 billion). Alibaba will pay 4.68 billion yuan for 7.6 percent of Wanda Film at 51.96 yuan per share, becoming Wanda Film’s second largest shareholder. Cultural Investment Holdings is slated to take a 5.1 percent stake in Wanda Film. Wanda Group will remain the film unit’s biggest shareholder with 48 percent after the stake acquisition by the two companies. Wanda Group said in an official posting yesterday that the stake acquisition helped introduce valuable strategic investors. “We believe the introduction of two strategic investors would complement Wanda Film’s current operation and benefit its long-term development,” it said. Wanda Film said in a stock exchange filing it would collaborate with Alibaba Group in film distribution, production, and online ticketing.

Nissan to invest US$9.5b to drive sales

Mon, 02/05/2018 - 17:01
JAPANESE automaker Nissan Motor and its Chinese joint venture partner announced yesterday a US$9.5 billion investment plan in China to increase annual sales by one million vehicles and boost electric car production. Dongfeng Motor Company is the latest Sino-foreign car company to splash out as China rolls out new regulations to limit gas vehicles and boost production of electric cars in coming years. Nissan’s high-end brand, Infiniti, will go all electric in China by 2025 under the plan. The company provided few specifics on the investment plan, saying the money would go into several areas, from manufacturing to human resources. The automaker sold 1.5 million vehicles in China last year, and said it plans to sell 2.6 million vehicles by 2022, when revenue is slated at 300 billion yuan (US$47.6 billion). The expansion plan calls for 20 new vehicle models, with 30 percent of its total sales to be made up of electric vehicles and new energy vehicles. China will implement a complex quota system in 2019 requiring makers to produce a minimum number of electric cars.

China transforming its economy to high-quality development

Sun, 02/04/2018 - 17:01
AFTER decades of speedy advances, China is shifting its economic focus to high-quality development, with “developing a modernized economy” high on the agenda. Now an economic catchphrase, the idea provides a blueprint for the world’s second largest economy during the next five years and beyond. It will be embodied in innovation-driven industries with coordinated development, an open and fair market, efficient and fair income distribution, coordinated urban-rural and regional development, energy conservation and environmental friendliness, and an open economy with higher standards. Efforts will be made to give full play to the role of the market, while the government is expected to play a better part. The real economy, once outshone by rampant real estate prices and financial speculation, has again gained traction. President Xi Jinping has described the real economy as the foundation of the modernized economy, advocating the use of new technology including the Internet, big data and artificial intelligence to boost traditional industries. To develop a modernized economy, China should channel more energy into improving the quality of supply and grow into a manufacturing powerhouse, said Wang Yiming, deputy director of the Development Research Center of the State Council. The government has rolled out an array of measures such as “Made in China 2025” and “Internet Plus” strategies. Funds that used to flow into the virtual economy due to high yields are returning to factories that produce tangible goods. New loans in the real economy rose 11.34 percent to 13.84 trillion yuan (US$2.2 trillion) last year. Thanks to rising investment, innovators sprouting up across the country are injecting new vitality into the economy. More homegrown tech firms are transforming from followers to leaders in the international tech community. Technology is playing a bigger role in driving the economy. Tech is estimated to have contributed 57.5 percent to economic growth last year, up from 56.2 percent in 2016, according to Wang Zhigang, vice minister of science and technology. Xi also called for a diverse, balanced, secure and efficient system for opening up on all fronts, with better use of global resources and markets and promotion of international cooperation under the Belt and Road Initiative. As 2018 is the 40th anniversary of China’s reform and opening up policy, the country’s door to the world will only become more open.

China’s CPI likely to ease in January

Sun, 02/04/2018 - 17:01
DESPITE rising food and oil prices, China’s inflation growth was likely to ease in January due to a high base a year ago, the Bank of Communications said in a report. BoCom predicted the consumer price index, a main gauge of inflation, will dip to 1.4 percent year on year in January from the 1.8 percent growth in December. Food prices grew markedly from a month ago as rain and snow across the country dampened the output of vegetables and other farm produce, according to the report. Meanwhile, price spikes in domestic refined oil drove up the CPI’s non-food sub-index as global crude prices hit the highest level in nearly three years last month. But January’s CPI will still moderate year on year as the price rises were offset by a high base in the same period of 2017, when consumer prices picked up by the fastest pace in two and a half years. China’s inflation has stayed subdued since last February, mainly due to stable food prices, with the full-year growth at only 1.6 percent, below the government’s annual inflation target of around 3 percent. BOCOM sees consumer prices to continue the mild trend this year, up 2 percent.

Apple offers free repairs

Sun, 02/04/2018 - 17:01
APPLE will offer free repairs to owners of iPhone 7 models which show “no service” connection problems, the US technology giant said on its website during the weekend. It’s the latest quality problem facing Apple. The glitch is due to a faulty component on the model’s main logic board, media reported. A “small percent” of iPhone 7s sold globally, including on the Chinese mainland, Hong Kong, Macau and the United States, may face the problem, Apple admitted. Owners of these iPhones may see “no service” displayed on their screens when in fact service is available. The problem phones were made between September 2016 and February 2018. Three model numbers are eligible for the free repair. In China, owners of model numbers A1660 and A1780, which are printed on the back of phone, can have free repairs in Apple Stores.  

Leshi sees debts to mature

Sun, 02/04/2018 - 17:01
LESHI Internet Information and Technology, the listed arm of technology company LeEco, expects 5.62 billion yuan (US$893.7 million) of debts to mature this year. The debts were only a part of the company’s total unpaid liabilities from financing and loans worth 9.29 billion yuan as of the end of last year, said a Leshi statement. “If the company’s business volume fails to rebound to the previous level, the cash flow will tighten further, which will put us under pressure to repay the debts,” Leshi said.  

Air bag defect forces recall

Sun, 02/04/2018 - 17:01
TOYOTA will recall 181,797 vehicles over an air bag defect in China. The recall was filed by GAC Toyota Motor and Tianjin FAW Toyota Motor to the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ). Starting Saturday, Toyota will recall 73,084 New Highlander vehicles manufactured between May 5, 2015 and February 4, 2016, and 98,218 Levin models produced between May 4, 2015 and February 4, 2016, as well as 5,804 Levin hybrid cars produced between October 11, 2015 and February 4, 2016, according to the AQSIQ. The recall also includes 4,691 Corolla hybrid cars made by Tianjin FAW Toyota Motor between November 21, 2015 and February 2, 2016. There are concerns that flawed acceleration transducer parts in the air bags of affected vehicles may cause air bags to malfunction, which could pose a threat to safety, the statement said.  

1st LED screen debuts

Sun, 02/04/2018 - 17:01
CHINA’S first LED (light emitting diode) cinema screen debuted yesterday in Shanghai to draw Chinese movie-goers who spend over 50 billion yuan (US$769 million) annually. The new LED cinema screen is the first of its kind in China. The screen is used in the Wujiaochang outlet of Wanda Cinema, China’s biggest cinema brand by audienceship. The new LED screen offers advanced contrast, brightness, and spectrum of color, according to market watchers.

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