Economy/Resources - 108. page

Recently, the International Energy Agency (IEA) issued the “Natural Gas Market Report 2018,” which predicts that, by 2019, China will become the world’s largest natural gas importer due to the lack of domestic supply. By 2023, China’s natural gas imports will reach 171 billion cubic meters, most of which will be LNG (liquefied natural gas).

According to the Chinese Ministry of Energy, China and India have become the fastest growing countries in demand for natural gas, especially LNG. Last year, China surpassed South Korea and became the second largest importer of LNG after Japan.

The Report shows that China and emerging Asian markets are promoting global natural gas consumption. Between 2017 and 2023, China will account for 37 percent of the increase in global natural gas consumption, surpassing every other country in the world. Regarding the forecast period, the Report expects the global natural gas market to exceed 4 trillion cubic meters by 2022, while China’s demand will grow at an average annual rate of 8 percent, accounting for more than one-third of the growth in global demand.

At present, the United States is the main producer of natural gas and exporter of LNG, accounting for nearly 45 percent of global production growth and nearly three-quarters of LNG export growth.

Source: Shanghai Security News, July 20, 2018
http://news.cnstock.com/paper,2018-07-20,1029054.htm

The Liao River is the principal river in southern Northeast China, and one of the seven main river systems in mainland China. Coursing 1,345 kilometers (836 mi) long, it passes through Hebei, Inner Mongolia, Jilin, and Liaoning Provinces.

According to Economic Information Daily, a subsidiary of the official Xinhua News Agency, in recent years, the amount of river water has decreased year by year. In many places, there is no water at all. A major section of the Liao River flows through Chifeng City and Tongliao City in Inner Mongolia, with a total length of 829 kilometers. In Chifeng City, since 2007, most parts of the river have run out of water for most of the year. In Tongliao City, the Liaohe River has experienced 20-years of being cut off.

In addition to the climate drought, the main reason is that there are too many water conservation projects along the river. In Chifeng alone, there are 82 large, medium, and small reservoirs in the upstream portion of the Liao River.

Over the years, with the interruption of water in the middle and upstream areas of the River and with the people living nearby increasing their demand for water consumption, the demand for groundwater has increased. This has resulted in over-exploitation and a decline in the water level. In Chifeng City and Tongliao City, groundwater depletion caused areas of land subsidence as large as 3000 square kilometers, and the water level dropped by about 10 meters.

The water interruptions have caused a large reduction in the area of lakes, wetlands and grasslands. Trees along the banks of the river have declined and died, posing a threat to the ecological environment and ecological security of this area. The grassland area in Tongliao City has been decreasing year by year since 2014. In 2004, the area of lake wetlands in Chifeng City was 60,738.05 hectares. By 2010, it shrank to half that size. Of the 82 reservoirs in Chifeng City, 40 percent have dried up.

Source: Economic Information Daily, August 6, 2018
http://jjckb.xinhuanet.com/2018-08/06/c_137370677.htm

A popular Internet posting titled “As Foreign Companies Leave China Who Will Fill in the Holes left by 45 Million Lost Jobs?” was circulating on overseas Chinese media sites. The original source has not been found. Below is a list of statistics and facts used in the article:
1. The following is a partial list of well-known foreign companies that have closed or are relocating manufacturing sites they have in China: Nikon, Nitto, Samsung, AU Optronics Corporation, Olympus, Omron, Adidas, Uniqlo, Foxconn, Intel, LG, and Nokia.
2. In November 2013, there were 57,200 foreign companies in China. By November 2016, there were 51,800 foreign companies in China, a reduction of 9.4 percent.
3. Fixed capital investment by foreign companies was at 214.6 billion in 2017 compared to 508.7 billion in 2011, a reduction of 57.8 percent in six years.
4. China made US$60.07 billion in investments overseas in 2011 vs. US$170 billion oversea investment in 2016. It shows that China’s investments overseas continue to grow.
5. Foreign companies account for less than 3 percent of the total companies in China, but they contributed over 50 percent of China’s foreign trade volume, 25 percent of profit and 20 percent of China’s tax income.
6. Regarding China’s foreign trade surplus in 2017, private enterprises and foreign companies accounted for 46.5 percent and 43.2 percent, respectively, and state-owned enterprises accounted for only 10.3 percent.
7. Foreign investment’s contribution to GDP: Guangzhou 62 percent of its GDP; Shanghai 67 percent, Shengzhen 70 percent.
8. One statistic suggested that in 2013, the number of people employed by foreign companies (including Hong Kong, Macao and Taiwan) reached a peak of 29.63 million. By 2014 and 2015, the number of employed persons was 29.55 million and 27.9 million respectively. By 2016, the number dropped to 26.66 million, a drop of 2.97 million in three years. China’s official number for direct employment by foreign companies in China, however, was at 45 million.
9. Three major reasons why foreign companies have left China: the real estate bubble, increases in operating costs, a decline in profit, and a devaluation of Chinese currency.

Source: Wenxuecity, August 2, 2018
http://www.wenxuecity.com/news/2018/08/02/7494179.html

According to Beijing News, the Intermediate People’s Court of Changchun City of Jilin Province recently issued a civil ruling that Xinghua Grain Depot, a subsidiary of Jilin Grain Group Co., Ltd., is insolvent and unable to pay off its debts. The court ruling showed that Xinghua’s current debt ratio exceeded 100 percent. It has 27 employees under labor contracts. The company has so far defaulted on wages, social security, and medical insurance payments.

As a matter of fact, before the Xinghua Grain Depot’s bankruptcy filing, its parent company Jilin Grain Group Co., Ltd. already quietly went bankrupt. The civil ruling that the Beijing News reporter obtained showed that the applicant, Wang Jing, applied to the Changchun Intermediate People’s Court for bankruptcy liquidation of the Jilin Grain Group on the grounds that it was insolvent and was not able to pay off its debts. On May 15, 2018, Jilin Grain Group submitted a written opinion to the court, expressing its consent to bankruptcy liquidation. The court ruled to accept Wang’s bankruptcy application for Jilin Grain Group.

Since August, a number of Jilin Grain Group’s subsidiaries including the above-mentioned Xinghua Grain Depot have filed for bankruptcy reorganization. For example, the Changchun Intermediate People’s Court issued another civil ruling on August 2, indicating that Jiashi Rice Industry Co., Ltd. has been unable to pay off its debts. It ruled to accept Jiashi Rice’s bankruptcy application.

Founded in 1996, Jilin Grain Group Co., Ltd. grows, processes, and distributes grains. With registered capital of 664 million yuan (US$97 million), it has 20 subsidiaries, a total of 3,000 employees and an annual sales income of more than 10 billion yuan (US$1.5 billion). A nationally recognized state-owned enterprise, Jilin Grain Group was China’s largest corn trader.

In recent years, Jilin Grain Group has been involved in corruption investigations. In February 2018, former party secretary and chairman of Jilin Grain Group, Meng Xiangjiuwas, was under investigation for “serious violations of discipline” and dismissed from the party. Xinhua News Agency reported a long list of charges against Meng, including illegal possession of property, misappropriation of public funds for illegal activities, accepting bribery when appointing officials, contracting projects and conducting business operations.

Source: Beijing News, August 3, 2018
http://www.bjnews.com.cn/finance/2018/08/03/498070.html

In order to prepare for the tough competition in the future, Chinese families continue to invest in their children’s education. Online travel agency Ctrip recently released the “2018 Summer Study Camp Report,” pointing out that more and more Chinese families prefer that their children go abroad for study and camp tourism. In 2018, the scale is expected to reach 1 million people, with expenditures of more than 30 billion yuan (US$4.4 billion).

The report sampled families with children between the ages of 8 and 12 and found that the proportion of families who are willing to participate in study tourism this summer is as high as 80 percent. The per capita expenditure for an overseas trip is more than 23,000 yuan (US$3,400). The average expense of a trip to the United Kingdom, the United States, or Australia is between 32,000 yuan (US$4,700) and 38,000 yuan (US$5,600); the shorter trips to Asian countries cost between 8,000 yuan (US$1,200) and 15,000 yuan (US$2,200). The most popular destinations for overseas study tours are the United Kingdom, the United States, Australia, New Zealand, Singapore, and Thailand.

The age of those going on overseas study tours is concentrated between 10 and 15 years old, accounting for 66 percent of the total. However, children under 6 years old also account for 5 percent.

The demand for quality in the study tours has gradually increased. Compared with the previous trips which were usually to open the eyes of the children, in recent years, parents have been giving thought to more professional considerations. Their inquiries include the information on the target school, the quality of teachers, the proportion of international students, the teaching philosophy of the school, and even the teaching materials.

Source: The Paper, August 3, 2018
https://www.thepaper.cn/newsDetail_forward_2317979

In the June 2018 issue of China’s Human Resources and Social Security magazine, Zhou Tianyong, a government scholar at The Institute for International Strategic Studies of the Chinese Communist Party’s Central Party School, published an article titled, “It is Imperative to remove birth control requirements completely.” The magazine is a publication of the Ministry of Human Resources and Social Security.

“As data that the National Bureau of Statistics released demonstrates, China’s population is facing an increasingly serious situation. The trend can be summarized by three declines, one rise, and one contraction.” As it continued, the article stated, “The first decline is the drop in the birth rate. In 2017 the national birth rate was 12.43 (births per year per 1,000 of population). The number was 12.95 in 2016. The second decline is the decline in the population of newly born babies. The number in 2017 was 630,000 less than in 2016. This is the equivalent of 4 percent fewer newborn babies. The third decline is the decline in fertility. In 2016, China’s fertility rate was only 1.24; the fertility rate in 2017 may be around 1.2.”

According to the article, “One rise refers to an increase in the aging population. In 2017, the population of the country’s population aged 60 and above was 240.9 million, accounting for 17.3 percent of the total population. Of those, 158.31 million were 65 and older, or 11.4 of the population. The population of both 60-plus and 65-plus years-of-age increased by 0.6 percentage points over the previous year.”

“One contraction means that the economically active population continues to shrink. China’s working-age population has continued to decline in proportion of the total population. The working-age population of people in 2017 who were aged between 16 and 59 was 901.99 million, accounting for 64.9 percent of the total population. In 2016, the number was 907.47 million, accounting for 65.6 percent of the total population.”

“Because of the combined effects of the above factors, the current population of China has formed a pattern of an accelerated decline of the birthrate, an increase in the population of the aging, and a shrinkage in the economically active population. The prospects are not optimistic.” “The reasons for this include difficulty in getting a job, the high cost of education, medical care, and housing, as well as the low supply of nurseries and kindergartens. They are important reasons for couples of childbearing age not to consider a second child.”

“In the next five years, with the youth population being reduced by about 30 million, China is likely to show a fast trend of an aging population, even faster than countries such as Japan, South Korea, and Taiwan. The aging of the economy will further put pressure on economic growth, and add to the burden that pensions create on the fiscal and financial systems.”

“It is Imperative to stop birth control completely.”

Source: The Paper, July 21, 2018
https://www.thepaper.cn/newsDetail_forward_2282278