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Economy/Resources - 159. page

Xinhua: Capital for Real Estate Companies Is Drying up

Xinhua recently reported that, according to the E-House Real Estate Research Institute’s "Report on Real Estate Enterprises’ Capital in the First Quarter of 2014," China’s real estate companies are tight on money.

For the first quarter, the year-on-year increase in the rate of fully-funded capital was 6.6 percent, a significant drop from last year’s 26.5 percent. On the source of capital, year-on-year foreign investment decreased 33.9 percent, while money from domestic lending and self-raised capital increased by 20.4 percent and 9.6 percent respectively.
The year-on-year increase in the rate of money lent domestically, foreign investment, self-raised money, and other sources of capital also dropped by 12.7 percent, 66.7 percent, 11.7 percent, and 30.8 percent respectively.

Unlike the tight money in real estate, the land market was still hot. Ten typical cities’ land transfer fees totaled 269 billion yuan (US$44 billion), an increase of 83.1 percent from a year ago. The total in land transfer fees from first tier cities (Beijing, Shanghai, Guangzhou, and Shenzhen) was 175 billion yuan (US$28.6 billion), which was 35 percent of last year’s annual amount.

As both overseas capital and domestic capital are drying up and as land prices keep increasing, the real estate business faces a severe money challenge. "Mid-level and small companies need to prepare for bad times. Some companies that can only tolerate a low risk may be forced out of the market."

Source: Xinhua, May 13, 2014
http://news.xinhuanet.com/house/bj/2014-05-13/c_1110654420.htm

Briefings | | |   Economy/Resources

HSBC’s April Chinese Manufacturing PMI Remains Low

Well-known Chinese news site Sina Finance recently reported that the newly released HSBC April Chinese Manufacturing PMI (Purchasing Managers Index) number remains low, at 48.1. This key indicator has remained below 50 for four consecutive months. Both “new export orders” and the “employment rate” have dropped significantly. Qu Hongbin, the HSBC Chief Economist for the China Region, commented that the domestic demand level recovered slightly but still remains low. He expressed the belief that the new numbers demonstrate that the manufacturing sector as well as the whole Chinese economy are still slowing down and that more economic stimulation policies are needed. PMI is an indicator of financial activity reflecting the purchasing managers’ acquisition of goods and services. A PMI number below 50 typically reflects a decline. 
Source: Sina Finance, May 5, 2014
http://finance.sina.com.cn/china/hgjj/20140505/103519001934.shtml
Briefings | | |   Economy/Resources

China News: The Canton Fair Reflected a Weak Import Export Situation

China News recently reported that China’s largest trade show, the China Import Export Fair (also known as The Canton Fair), closed on May 5 in Guangzhou, Canton Province. The 115th Canton Fair, widely regarded as “China’s International Trade Barometer,” attracted significantly fewer foreign attendees than last year, while the volume of signed export agreements also fell. Over 55 percent of the foreign procurement representatives were from Asia. Those from Europe and North American combined held only around one third of the foreign customers. The main region that saw an increase of the number of buyers was Africa. This round of the Canton Fair concluded with a total export volume of US$31 billion, which represented a 12.64 percent decrease from last year. The Spokesperson for the Fair indicated that the outcome was slightly disappointing; however, it correctly reflected a very slow recovery of the global economy, especially in China’s “traditional European and American markets.” Another key observation at this Fair was that most (more than 80 percent) of the contracts were short-term contracts (less than six months into the future). 
Source: China News, May 5, 2014
http://finance.chinanews.com/cj/2014/05-05/6135380.shtml
Briefings | | |   Economy/Resources

About Twenty Thousand Ducks Died in Beijing; Bird Flu Suspected

Beijing News reported that about 20,000 ducks died within a week in six farms. The number is increasing daily. Wang Haijun started raising ducks last year. Since April 29, 2014, many of his 7,200 ducks have suddenly died. Less than 600 have survived. His neighbor Pan Meibing found that his ducks started to die on May 4. As of May 7, 2014, of 4,800 grown-up ducks, over 3,000 had died. Of 4,800 younger ducks, over 500 had died. Every day, large numbers of duck are dying.

Reports indicate that these farms have purchased feed from different sources. People have applied dozens of types of medicine, but to no avail. The farmers said that, before they died, the ducks showed symptoms consistent with bird flu. 

Source: Beijing News, May 8, 2014 
http://www.bjnews.com.cn/news/2014/05/08/316022.html

Briefings | | |   Economy/Resources

Xinhua: Investment Funds Are Selling off Their Real Estate Holdings

Xinhua reported that, according to statistics, in the first quarter of 2014, 41.28 percent of stock funds and blend funds sold off their real estate holdings. 

Out of 625 stock funds and blend funds, 258 cleared out their holdings in the real estate sector and now have zero investment in that sector. 
In those three months, the market value of the real estate stocks that the funds held dropped from 39 billion yuan to 31 billion yuan, a decrease of 7.8 billion. 
According to the 2014 first quarter reports of the investment funds, after the financial sector, the real estate sector was the hardest hit. A downward price adjustment and a market cooling have been confirmed for the housing market. The changes in the housing market will put significant pressure on the stock market. 
Source: China Securities, May 8, 2014 
http://news.cnstock.com/news/sns_yw/201405/3014364.htm
Briefings | | |   Economy/Resources

BBC Chinese: Iran Cancelled US$2.5 Billion Contract with China

BBC Chinese recently reported that the Iranian government just announced a decision to discontinue a US$2.5 billion oilfield development contract with PetroChina. The contract required PetroChina to deliver 185 oil wells in the South Azadegan oil field, which is located near the Iran-Iraqi border. However, according to the Iranian government’s official website, PetroChina only delivered seven. The Chinese vendor won the contract when the Western countries jointly sanctioned Iran. Iran claimed that a warning notification was sent to PetroChina 90 days before the contract termination. However, the Chinese company did not take any action. The Iranian government had another contract with PetroChina for developing the North Azadegan oil field. There has been no report on that contract. The Azadegan oil field is one of the largest oil fields in the world, with a crude oil reserve of 420 billion barrels.
Source: BBC Chinese, April 30, 2014
http://www.bbc.co.uk/zhongwen/simp/world/2014/04/140430_iran_china_oil.shtml
Briefings | | |   Economy/Resources

Xinhua: Singapore Has Become the Second Largest Offshore RMB Center

According to data released by the Society for Worldwide Interbank Financial Telecommunication (SWIFT), on April 28, Singapore surpassed London and became the second largest offshore RMB center next to Hong Kong. The statistics showed that the March RMB settlement amount in Singapore accounted for 6.8 percent of the total. It thus surpassed London, which had 5.9 percent. However Hong Kong, which accounts for 72 percent of the world’s total, still remains the largest.

Source: Xinhua, April 29, 2014
http://news.xinhuanet.com/2014-04/29/c_126444131.htm

Briefings | | |   Economy/Resources

China to Build a Second Ship Lock at the Three Gorges Dam

According to a report from 21st Century Business Herald, building a second ship lock at the Three Gorges Dam may become a priority project to break the bottleneck in the Yangtze River’s shipping. If there is a fog or wind, ships will pile up waiting to pass the ship lock. Normally it takes three to five days. In the event the ship lock is under repair, the wait to pass the Three Gorges Dam can be between seven and 10 days, or even longer. 

The Ministry of Transportation recently released a government report showing that, in 2013, the average wait time to pass the Three Gorges Dam was about 10 days. The one way capacity of the first ship lock as designed is about 50 million metric tons per year. In 2013, it was approaching the upper limit set by the design. “The limited capacity to pass the ship lock will become a major issue affecting sustainable development of the region along the Yangtze River.” The Three Gorges Project Construction Committee, under the State Council, has been tasked with preparing a proposal for the construction of the second ship lock. 

Source: 21st Century Business Herald reprinted by Xinhua, April 30, 2014. 
http://jjckb.xinhuanet.com/2014-04/30/content_502706.htm

Briefings | | |   Economy/Resources