China Boosts Yuan Swaps, Store Payments as Dollar Concern Grows



April 2 (Bloomberg) — China’s leaders, increasingly concerned about the nation’s $740 billion of U.S. Treasuries, are making it easier for trading partners and consumers to do business in yuan. Continue reading

Bank of China Drops Rothschild Deal as Second Deadline Passes


April 2 (Bloomberg) — Bank of China Ltd., the world’s third-largest by market value, said it scrapped a planned 236 million-euro ($313.3 million) investment in La Compagnie Financiere Edmond De Rothschild after a second deadline for getting government approval expired.

“The agreement has expired and has automatically become invalid,” Bank of China spokesman Wang Zhaowen said in a telephone interview from Beijing today. “We may in the future seek cooperation in other areas” with the French firm.

Bank of China was forced to extend an original Dec. 31 deadline for the deal, announced in September, by three months after failing to get state approval. The Chinese bank had agreed to purchase a 20 percent stake in the Paris-based asset manager.

By Zhang Dingmin

Global Economic Slide May Be Easing as G-20 Gathers



April 2 (Bloomberg) — Leaders of the most powerful nations meet today amid signs that the world economy is stabilizing after months of freefall.

The Group of 20 summit convenes in London as some reports suggest the pace of decline is easing. U.S. durable-goods orders and home sales rose in February, Chinese urban investment surged 26.5 percent in the first two months of the year, and German investor confidence in March reached its highest level since July 2007. The Standard & Poor’s 500 Index last month rallied the most in seven years. Continue reading

Obama Meets Hu as Stimulus Plans May Heat Clashes



April 1 (Bloomberg) — Presidents Barack Obama and Hu Jintao meet for the first time today to discuss a global economic crisis each is trying to combat with policies that may further complicate U.S.-China relations.

As they meet ahead of a gathering in London with other leaders from the Group of 20 advanced and emerging economies, the two presidents are directing a combined $1.4 trillion of stimulus spending. Continue reading

Google launches free music site in China



Chinese internet users will be able to download more than 1m music tracks for free after Google launched a new web service with the world’s four largest music labels.

Pulling the L-plates from a service that launched in trial mode a year ago, the downloads service marks an aggressive move by Google to take on the Chinese search site, which has more than twice the market share of the California-based technology giant. Continue reading

5,000 cuts coming to IBM




* Latest round hits more than 4 pct of U.S. workforce


* Job cuts mostly in IBM’s global services business


* Shares close down 0.42 pct (Adds analyst comment, details on IBM’s recent results)


NEW YORK, March 25 (Reuters) – IBM (IBM.N) will cut about 5,000 jobs in the United States, adding to similarly large cuts in the past few months, sources with knowledge of the matter told Reuters on Wednesday. Continue reading

Peace conference ‘postponed’ after Dalai Lama refused visa


A conference celebrating South Africa’s emergence as a multi-racial society after decades of white minority rule has been called off after the Pretoria government refused to give a visa to a principal guest, Tibet’s spiritual leader the Dalai Lama.

The peace conference bringing together South African Nobel Peace Prize laureates and international advocates of peaceful reform was due to be held in Johannesburg on Friday as a prelude to South Africa’s hosting of the World Cup of soccer next year. Continue reading

West ‘lacks information about Tibet’

TORONTO: Independence for Tibet can never be accepted, but talks with representatives of the Dalai Lama could resume “at any time” if the political exile gives up his separatist stance, a visiting living Buddha from the autonomous region said over the weekend.

“The door remains open and talks could resume at any time if the Dalai Lama meets the requirements of the central government,” said Shingtsa Tenzinchodrak, head of a delegation of five Tibetan National People’s Congress (NPC) deputies to North America, while addressing local media and overseas Chinese. Continue reading

China “opposes any platform” for Dalai Lama’s secessionist activity


BEIJING, March 24 (Xinhua) — China opposes the government of any other country providing support or a platform for the Dalai Lama’s secessionist activity, Foreign Ministry spokesman Qin Gang told a regular press conference here Tuesday.

    Responding to questions on the South African government’s refusal of a visa to the Dalai Lama, Qin said: “China applauds the position of those countries that respect China’s sovereignty and territorial integrity, adhere to the one-China policy and oppose the independence of Tibet.” Continue reading

China open to boosting IMF’s firepower via bond issue

          BEIJING, March 23 (Reuters) – China is ready to explore all channels to raise money for the International Monetary Fund and would actively consider subscribing to a bond issue by the Washington lender, a senior central bank official said on Monday.
Increasing the firepower of the IMF so it can bail out countries felled by the global financial crisis will be high on the agenda of a summit on London on April 2               of the Group of 20 advanced and emerging economies.
Issuing bonds would be a way for the IMF to raise large sums of money in short order, Hu Xiaolian, a vice governor of the People’s Bank of China, told a news conference on China’s preparations for the G20.
“If the IMF decides to issue bonds to raise funds, China will actively consider buying,” she said.
Hu, who is also head of the State Administration of Foreign Exchange, said another way of raising funds fairly quickly was the New Arrangements to Borrow           (NAB), a long-standing pact among 25 member countries to lend to the IMF in case of need.
China is not a member of the NAB. If it were to join — and Hu did not address this issue — expanding the agreement could take up to three months, international officials have estimated.
Countries can also contribute bilaterally. Japan is making a $100 billion loan, while the European Union agreed last week to put up 75 billion euros.
The IMF has said it needs an extra $250 billion to double its war chest. The United States has suggested a $500 billion increase.
Beijing has repeatedly called for a louder voice for developing countries in the IMF, a stance that Hu and He Yafei, a vice foreign minister, reaffirmed on Monday.
China hoped the G20 summit would help to shore up the fight against protectionism and lend continued support to developing nations, He added.
Pressed whether China would insist on an increase in its IMF quota, or membership subscription, in return for providing more funds, Hu said the distribution of quotas was a complicated issue that required in-depth study.
G20 finance ministers agreed in London earlier this month to bring forward the next review of IMF quotas to 2011 from 2013.
Asked whether the G20 should back the establishment of a new global regulatory institution or a new global currency, Hu said the current priority was for the IMF to step up its supervision of the policies of reserve-currency countries such as the United States.
A senior Russian government source said last Thursday that China and other emerging nations backed Russia’s call for a discussion on how to replace the dollar as the world’s primary reserve currency.
But Hu said that, while research could start into the merits of a multi-currency global reserve system, the dollar remained the dominant currency; the priority now was not to replace it.
U.S. Treasuries were an important part of China’s foreign exchange reserves and Beijing would keep buying them as it viewed the overall credit risk as low, Hu added. (Reporting by Zhou Xin and Simon Rabinovitch; Editing by Alan Wheatley)
By Simon Rabinovitch

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Official says China to continue buying US debt

Official says China to continue buying US debt


BEIJING (AP) — China will continue buying U.S. government debt while paying close attention to possible fluctuations in the value of those assets, a vice governor of Beijing’s central bank said Monday.

Investing in U.S. Treasury bills is “an important component part of China’s foreign currency reserve investments,” People’s Bank of China Vice Governor Hu Xiaolian said at a news conference on Monday. Continue reading

Infineon, Huawei ink framework purchase agreement


Infineon Technologies AG has signed a letter of intent for framework purchase agreement amounting $68 million with China‘s Huawei Technologies Co. Ltd. This deal, as an important part of the recent European procurement tour of China’s business delegation, is intended to supply end-to-end chip solutions to Huawei’s wireline and wireless communication systems. Infineon will provide semiconductor solutions for Huawei in the area of central office solutions, customer premise equipment and mobile phone platforms. Continue reading

China’s key index rises 7.2 percent for the week


SHANGHAI: China’s main stock market index rose for a fifth day Friday, gaining 7.2 percent for the week as higher commodity prices pushed up oil, coal and metals stocks.

The benchmark Shanghai Composite Index added 15.33 points, or 0.7 percent to close at 2,281.09. The Shenzhen Composite Index for China’s smaller second exchange fell 0.02 percent to 752.35. For the week, it rose 8.6 percent.

Resource stocks, a focus of China’s weeklong rally, rose after the U.S. Federal Reserve rolled out a $1.2 trillion plan to buy government bonds and debt securities, fueling inflation fears and raising commodities prices.

“This round of the rally was not based on optimism over the economy, but an expectation on future inflation,” said Wen Lijun, an analyst for Nanjing Securities.

Jiangxi Copper Ltd., China’s second-largest metal producer, and Zhongjin Gold Corp both surged the daily maximum of 10 percent, Jiangxi Copper to 22.33 yuan, and Zhongjin Gold to 57.38 yuan.

Aluminum Corp. of China, or Chinalco, the country’s biggest aluminum producer, climbed 4.7 percent to 10.98 yuan.

China’s two main oil companies rose after the April crude future surged to above $50 a barrel overnight. PetroChina Ltd., Asia’s biggest oil and gas producer, leapt 4.8 percent to 11.57 yuan and China Petroleum & Chemical Corp., Asia’s biggest refiner by volume, climbed 2.3 percent to 8.77 yuan.

Coal miners also benefited from higher energy prices. Anhui Hengyuan Coal industry Co. gained 6.1 percent to 22.4 yuan and Datong Coal Co. rose 2.2 percent to 18.04 yuan.

In currency markets, the yuan weakened slightly to 6.8267 to the U.S. dollar, down from Thursday’s close of 6.82447.




新华网社北京3月18日电 国务院总理温家宝18日主持召开国务院常务会议,审议并原则通过《落实〈政府工作报告 〉重点工作部门分工意见》和《全国森林防火中长期发展规划》,讨论并原则通过《中华人民共和国人民武装警察法(草案)》。












会议还研究了其他事项。 (本文来源:新华网 )




新华网北京3月18日电 记者从可口可乐中国公司获悉,可口可乐公司18日宣布,由于中国商务部公布了不批准对汇源果汁业务建议收购的决定,因此可口可乐公司将不能继续有关收购行动。




最近可口可乐公司宣布,未来三年将在中国市场投资20亿美元,用于兴建工厂,强化分销系统,加强市场营销,并增强在本土的产品研发创新能力。可口可乐自1979年重返中国市场后在中国市场共计投资16亿美元。“我们还会继续加大对中国公益事业的投入,并为中国的可持续发展和繁荣尽我们的努力。” (本文来源:新华网 作者:罗宇凡、周文林)

Coke Bid for Juice Maker Turns Sour

The government rejected Coca-Cola’s plan to acquire beverage maker China Huiyuan Juice Group Ltd for $2.4 billion on Wednesday, citing the country’s anti-monopoly law.

The acquisition by Coca-Cola, announced last September, would have been the largest ever buyout of a Chinese company by a foreign rival.

The planned takeover violates the provisions of the Anti-Monopoly Law, the Ministry of Commerce (MOC) said in a statement, adding that it would have restricted competition and harmed the domestic juice industry.

“If the acquisition went into effect, Coca-Cola was very likely to reach a dominant position in the domestic market and consumers may have had to accept a higher price fixed by the company as they would not have much choice,” the statement said.

The MOC launched an anti-trust investigation on Nov 11 to determine whether the acquisition would harm other rivals, consumer rights or technological innovation.

The bid was the first major deal to test the Anti-Monopoly Law, which took effect on Aug 1 last year. If passed, the deal would have been Coca-Cola’s largest overseas acquisition and the company would have been able to expand its dominant position in the carbonated drinks market to the juice market.

The ministry said that Coca-Cola and Huiyuan are major brands in the juice market, and therefore, the combination would have restricted competition in the industry and made it more difficult for other players to enter the sector.

The ministry said the deal would also have squeezed development space for other small- and medium-sized enterprises, and is not good for the development of the country’s juice industry.

Huiyuan said yesterday that it respects the decision made by the ministry, and production would continue as normal. The company’s share dived 19.24 percent to HK$8.30 yesterday before trading was suspended shortly after the market opened in the morning.

Muhtar Kent, president and chief executive officer of Coca-Cola, said: “We are disappointed, but we also respect the MOC decision.”

He said the company had put a tremendous effort into providing all the relevant materials to the MOC to ensure that they had all the information available and understood the transaction.

“We were looking forward to working with the excellent Huiyuan team to stimulate new growth for the Huiyuan brand.”

He said the company will now focus all of its energies and expertise on growing existing brands and continuing to innovate with new brands, including in the juice segment.

Huang Wei, beverage analyst at China Jianyin Investment Securities, said: “The ministry’s decision is not surprising. But it’s not good for Huiyuan, whose market share will probably shrink as international players such as Coca-Cola invest more in the juice market.”

Coca-Cola’s offer to buy the Hong-Kong listed company was seen as a major strategic move to tap China’s fast growing juice market.

While the world’s largest soft drink manufacturer dominates the carbonate market in China, its share in the juice market is relatively small.

On the other hand, Huiyuan is the largest juice beverage maker in China, with over 45 percent of the pure juice market in the country. It also controls more than a tenth of the Chinese fruit and vegetable juice market that grew 15 percent last year to $2 billion. Coca-Cola has a 9.7 percent market share and dominates in diluted juices.

China is Coca-Cola’s fourth-largest market and a key battleground with rival PepsiCo Inc.

Huiyuan’s founders and major shareholders had endorsed the sale as a way for the company to improve product development and marketing.

An MOC official said Coca-Cola had tried to address the negative effects on competition after it sought government approval for the deal in November, but its efforts did not meet the requirements of regulations.

“It is only an isolated case, and it does not suggest any change in China’s policy on foreign investors,” the official said.

The MOC said it has investigated 29 proposed acquisitions under the anti-monopoly law since August and approved 24.

(China Daily March 19, 2009)