Must Read
Chinese News Sources
Notables
15. Reuters: Gap Inc seeks new berth in China with Old Navy
16. Bloomberg Businessweek: China's population shift and investment mismatch
17. NYT: Home prices in China may hurt families
18. FT: China’s mobile sector grows up superfast
19. NYT: Web banks, offering high interest rates, rise in China
To subscribe to this news email – click here
Edited by Marc Ross
Back to Top
Notes:
Some websites and links may be inaccessible in China.
Must Read
1. Bloomberg: China growth-target dilemma looms as legislature meets
China’s Communist Party leadership faces a dilemma over where to set a growth goal for 2014 as President Xi Jinping wrestles with sustaining expansion while limiting debt risks, environmental damage and social unrest. The target, set at 7.5 percent last year, will be announced at this week’s meeting of the National People’s Congress in Beijing. In a Bloomberg News survey, 63 percent of economists predict the same number this year, while 33 percent see either a 7 percent goal or a range, such as 7 percent to 7.5 percent.
A farmer, right, cycles on a road in Pinggu, on the outskirts of Beijing. Photographer: Tomohiro Ohsumi/Bloomberg
Bloomberg Back to Top
2. LAT: Mass stabbing attack in Kunming shows depth of Uighur conflict
Deng Wei, his wife and 8-month-old baby
were having dinner in a little restaurant in an alleyway next to this city’s main train station Saturday night when a man and a woman, both in black, came striding by, clutching large knives. “They were headed toward the station, and I decided to follow them, at a distance. They began slashing people, and when they passed the police kiosk on the corner of the square, the officers did nothing to stop them,” Deng, 26, recalled Sunday in front of the station. “People began screaming. It was chaos.” The attackers charged into an open-air pavilion used as a waiting area, wordlessly plunging their knives into people at random, Deng and other witnesses said. At least eight more attackers followed, rushing into the ticket sales office and cutting down people as they queued, leaving victims lying in pools of blood on the floor. By Sunday evening, the death toll from what one newspaper affiliated with the Communist Party called “China’s 9/11” stood at 29 dead and 130 injured. More than 70 remained hospitalized in critical condition. Four attackers were also slain, shot dead by police at an intersection just in front of the station, and one woman was said to be in custody. But that meant at least five other suspects remained at large. Authorities and witnesses said the assailants were Uighurs, a Turkic-speaking Muslim minority from northwestern China’s Xinjiang region. No group has claimed responsibility for the attack, but on TV, Chinese authorities displayed what they said was a black flag recovered at the scene calling for independence for the region, which some Uighurs refer to as East Turkestan.
LAT Back to Top
3. NYT: China blames Xinjiang separatists for stabbing rampage at train station
The group of about 10 attackers, dressed in black and wearing cloth masks, arrived in front of
Kunming Railway Station in southwest China on Saturday night and began slashing at employees and commuters, sometimes repeatedly plunging their long knives and daggers into people too stunned or slow to flee. By the time the police shot dead four assailants and ended the slaughter, the square and ticket sales hall
at the station were strewn with bodies and moaning survivors in pools of blood. According to the state news media, 29 people were killed and 143 wounded. The police captured one of the
assailants but several others were said to be still at large. Witnesses said that at least one of the attackers was a woman.
NYT Back to Top
4. WSJ: Xinjiang separatists said to be behind attack at train station
A mass knife attack at a train station that left 33 dead over the weekend signaled Chinese authorities are facing a significant escalation of a long-simmering separatist movement. Saturday's assault marked the second time in a little over four months that Chinese authorities say separatists from the Xinjiang region—which borders Pakistan, Afghanistan and former Soviet Central Asia—have carried out a relatively complex and carefully planned attack outside their home territory. At least 10 assailants armed with long knives and dressed in black stormed through a crowded train station Saturday night in the southwestern city of Kunming, slashing people at random, according to state media. Police shot and killed four assailants, arrested one, and were searching for five others, state media said. Thirty-three died, including the attackers, and at least 130 were injured.
WSJ Back to Top
5. WSJ: China urges dialogue on Ukraine
China called for dialogue to resolve the fractious situation in Ukraine, though it didn't criticize Russia outright for sending troops into Ukrainian territory and threatening further use of force. Chinese foreign ministry spokesman Qin Gang said "China condemned recent acts of extreme violence in Ukraine" but didn't identify perpetrators. In a statement posted on the ministry's website on Sunday, Mr. Qin said China is appealing to all sides to adhere to international laws and norms to resolve the dispute and restore stability. The statement appeared to mix mild barbs with
understanding for Russia's position. It said that "China always sticks to the principle of noninterference in any country's internal affairs."
WSJ Back to Top
6. Reuters: China HSBC manufacturing PMI hits seven-month low in February
China's factory activity shrank again in February as output and new orders fell, a private survey found on Monday, reinforcing concerns of a slowdown in the world's second largest economy. The final Markit/HSBC manufacturing Purchasing Managers' Index (PMI) fell to a seven-month low of 48.5 in February, the third straight monthly decline, from January's 49.5. The figure was in line with the 48.3 reported in the preliminary version of the PMI released on Feb 20. A reading below 50 indicates a contraction, while one above 50 shows expansion. "Signs are becoming clear the risks to GDP growth are
tilting to the downside," said Hongbin Qu, chief economist for China at HSBC, in a statement accompanying the PMI results.
Reuters Back to Top
7. FT: Renminbi’s fall marks seismic shift
Compared with the recent turmoil of double-digit currency devaluations and political unrest in other emerging markets, a modest fall this week in China’s currency was an unlikely cause for global alarm. But, as with many things, China is different. An unexpected slide in the
renminbi – supposedly carefully managed and stable – led to a surge in speculation about Beijing’s control over the world’s second-biggest economy and rattled financial markets, at least until attention was diverted
by Ukraine. In the past nine trading days, the
renminbi has dropped around 1.4 per cent against the dollar to Rmb6.14 – levels not seen since last summer. The
week-long fall is the steepest since 2005, when China unhooked its currency from the dollar. Whether the currency’s drop is just a blip or hints at bigger problems will be crucial for other emerging markets – with greater use of the
renminbi increasing contagion risks – and in turn developed economies. How much the world should worry is a controversial question, however.
The
week-long fall is the steepest since 2005, when China unhooked its currency from the dollar. Reuters
FT Back to Top
8. Reuters: China's state planning body grows more assertive as revamp looms
China will present proposals to revamp its behemoth economic planning agency at an annual session of parliament this week, sources said, but the organization's role as an antitrust regulator could eventually be enhanced
.Chinese and foreign companies, including U.S.
technology firms Qualcomm Inc.
and InterDigital Inc.,
have fallen afoul of the National Development and Reform Commission (NDRC) in recent months as its anti-monopoly arm has become more assertive. The mammoth agency, which has several thousand employees and has sweeping powers to decide on investment, prices and other issues in the world's second-biggest economy, is striving to retain as much power as possible as it undergoes restructuring. The crackdown on price-fixing and monopolistic practices should become more pronounced as the NDRC has said it is ramping up staffing in its antitrust division. Academics and senior officials have forecast a streamlining of the NDRC since President Xi Jinping vowed to make the economy more responsive to market forces and shift to consumer-focused investment from a state-led model. Two sources close to senior leaders said proposals have been readied to restructure the NDRC and these will be discussed at the National People's Congress annual session beginning on Wednesday.
Reuters Back to Top
Chinese News Sources
9. Xinhua: China ready for annual session of top political advisory body
China is fully prepared for the annual session of the national political advisory body, which is to be held from March 3 to 12, said a spokesman here Sunday. As of 12 a.m. Sunday, 1,355 out of 2,229 members of the National Committee of the Chinese People's Political Consultative Conference (CPPCC) have registered
at the secretariat of the session, said
Lyu Xinhua, spokesman with the session, at a press conference. The secretariat has received a total of 990 proposals and 303 speech transcripts,
Lyu said. The session is scheduled to open at 3 p.m. Monday at the Great Hall of the People in Beijing. At the opening meeting, Yu Zhengsheng, chairman of the CPPCC National Committee, is expected to deliver a report on the work undertaken by the CPPCC National Committee's Standing Committee during the past year. According to the session's schedule, political advisors will listen to and deliberate Yu's report as well as a report on the proposal-related work of the CPPCC National Committee since the last annual session.
Xinhua Back to Top
10. SD: Yuan sees biggest weekly loss on talk of reform
The yuan yesterday suffered the largest weekly loss on record on talk the Chinese central bank may reform the exchange rate market further. The yuan briefly hit a 10-month low of 6.1808 per US dollar before closing at 6.1450 yesterday. The closing was nearly 0.3 percent weaker than Thursday’s despite the People’s Bank of China’s slight firming of the central parity rate to 6.1214 per dollar. The yuan is allowed to trade between 1 percent on each side of the
daily fixing set by the PBOC. The
yuan weakened around 0.9 percent this week and was more than 2 percent lower than its 20-year high of 6.0406 reached on January 14.
SD Back to Top
11. SD: Foreign exchange controls eased for firms in city’s free trade zone
The central bank has eased foreign exchange controls in Shanghai’s free trade zone, including cutting red tape for foreign direct investment as part of efforts to pilot capital account convertibility. Investors can now register FDI-related foreign exchange activities with banks instead of regulators, and can make settlement of foreign exchange capital without submitting proof of use of funds in advance, the Shanghai headquarters of the People’s Bank of China said in rules released yesterday. Foreign investment companies can open a corresponding yuan account for each of their foreign exchange capital accounts, and use funds in the yuan account to pay for legitimate deals. The move could give investors more freedom in managing their cash and avoiding exchange rate risks. The measures are contained in a 60-page document outlining foreign exchange management rules in the
zone to support cross-border trade and investment.
SD Back to Top
12. Xinhua: China has 12 million private firms
China has more than 12 million private companies in the country, which are helping boost economy, the All-China Federation of Industry and Commerce (ACFIC) said Friday. By the end of 2013, 12.54 million private firms were registered in the country, an increase of 15.5 percent year on year, the ACFIC said in a statement. Registered capital of the companies reached 39.3 trillion yuan (6.4 trillion U.S.
dollars), marking a year-on-year rise of 26.4 percent, it said. The federation said the number of registered individual businesses reached 44.36 million as of 2013, up 9.3 percent year on year and total registered capital amounted to 2.4 trillion yuan. Private businesses accounted for over 60 percent of the total gross domestic product (GDP) in China last year, said the statement. China's e-commerce transactions reached 9.9 trillion yuan and its online retail sales amounted 1.85 trillion yuan in 2013, up 21.3 percent, 42 percent respectively.
Xinhua Back to Top
13. Caixin: Gary Locke expresses optimism for future of Sino-U.S. ties
Departing U.S.
ambassador says continued cooperation on a range of issues will prevent the two countries from getting into a major conflict.
Caixin Back to Top
14. Caixin: Yuan won't overtake dollar until changes are made, economist says
Former head of the IMF's China division cites a range of reasons country's currency won't threaten America's soon, including
need for political reform.
Caixin Back to Top
Notables
15. Reuters: Gap Inc seeks new berth in China with Old Navy
When Gap Inc began an online campaign ahead of the launch its Old Navy label in China, the iconic U.S.
clothes retailer posed an important question to its potential Chinese consumers: have you heard of Old Navy? Only a few had. Brand awareness is one of the uphill battles Gap faces in China as the U.S.
firm looks to increase its stake in the world's second largest clothing market, where it lags rivals H&M, Japan's Uniqlo, owned by Fast Retailing Co Ltd and Inditex SA's Zara. Gap, which launched its first Old Navy store in Shanghai on Saturday, plans to open five stores of the value-end chain this year as well as adding 30 Gap stores to its current 81, Gap's Greater China president Jeff Kirwan told Reuters on Saturday.
Reuters Back to Top
16. Bloomberg Businessweek: China's population shift and investment mismatch
It’s a well-known problem: In recent
years China’s economy has been driven to an often unhealthy degree by supercharged levels of investment, with yuan
going into new production lines, roads, rail, and residential housing blocks. Now a new report by China economic research firm GavekalDragonomics, in Beijing, looks more closely at what places are sucking in the money, contrasting
that with population shifts (China has some 20 million rural residents moving to cities annually) to see how well it matches. What it shows is hardly reassuring. “While population growth was very uneven, investment growth was uniformly high across China in the previous decade,” writes Adam Hirschberg, in “Urbanization’s Winners and Losers,” published Feb. 20. “Rather than responding to weak population growth, investment growth in the smaller and less attractive regions actually accelerated.”
Bloomberg Businessweek Back to Top
17. NYT: Home prices in China may hurt families
China’s banks may not be directly exposed to losses from the country’s soaring housing prices, but any slump in those prices could set off widespread public anger, data from a broad new survey of household finances indicates. The survey — the largest academic study of personal finances in China, with 99,000 individuals in 28,000 households interviewed late last summer — found that Chinese families have put their savings overwhelmingly into their houses. A combination of large down payments and soaring prices means that even if housing prices were cut in half, only 5 percent of homes would be worth less than the remaining balance on their mortgages, the survey found. But the survey, conducted by Southwestern University of Finance and Economics in Chengdu, China, also found that Chinese households have an inordinate share of their total assets in their homes, with very little diversification into stocks, bonds and other assets. Housing prices have been soaring for more than a decade in China, up as much as
twentyfold in smaller towns that have been suddenly connected to
big cities by high-speed rail lines, and up significantly in large cities as well.
NYT Back to Top
18. FT: China’s mobile sector grows up superfast
The bustling shopping streets of Shanghai drive home the image of a country glued to mobile devices, often at the expense of passers-by shouldered out of the way by workers hurrying past with
smartphone in hand. The Chinese telecoms market was similarly urgent for the 75,000 people who descended on a bustling Barcelona last week for Mobile World Congress, the industry’s biggest annual conference. While Europeans and Americans have had
superfast 4G services for several years, the nearly one billion people signed up to China Mobile, the world’s largest mobile carrier, are only now being given their first sight of so-called 4G or LTE technology. But such is the scale and speed at which China’s telecoms industry moves – driven by state policy – that there are already more 4G mobile masts installed in China than in the whole of Europe. That gap will accelerate with a further wave of huge tenders expected
by the leading equipment makers in the next few months.
Device makers, such as
Appple, have had to adapt their products to the Chinese 4G technology – a standard called TD-LTE. Reuters
FT Back to Top
19. NYT: Web banks, offering high interest rates, rise in China
Last June, an affiliate of the Chinese e-commerce giant Alibaba made an offer to its hundreds of millions of users: Give us your cash, and we will pay more than Chinese banks will. Savers swamped the company seeking interest rates that were significantly higher than the low rates fixed by the government. By early February, 81 million people had signed up for the company’s money market product called Yu’e Bao, which translates as “leftover treasure.” The fund, which was established by Alipay, a unit of Alibaba, now has $40 billion in assets under management, making it the country’s biggest money market fund. Other big Chinese Internet companies have followed suit, promising even higher returns than
Yu’e Bao. The result is an assault on one of the crucial instruments the Chinese government uses to manage the economy: interest rates. “This is the beginning of interest rate liberalization,” says Chang Chun, who teaches at Shanghai Jiao Tong University’s Advanced Institute of Finance. “People want to get a higher yield on their savings deposits, and so this is one way to get around the regulation.”
Jack Ma, the founder of Alibaba, says
regulations are stifling investment and savers. Credit Peter Parks/Agence France-Presse — Getty Images
NYT Back to Top
