The state’s media, China Central Television (CCTV), reported that the Bank of China, one of the four major state banks, engages in money laundering. In violation of government control of cross-border fund transfers, it transfers large amounts of cash abroad for clients who plan to emigrate overseas.
Economy/Resources - 162. page
Underground Electronics Recycling Sites Annual Production Close to 100 Billion Yuan
Guangming Daily recently published an article on electronics recycling. According to the article, there is an underground electronics recycling chain that covers an area from Beijing and Hebei to Guangdong Province. Its high profitability propels an annual production that is close to 100 billion yuan (US$16 billion). Meanwhile, the officially registered recycling companies lack sufficient business and their recycling processing lines sit idle. Xiejia Village, which is located 6 kilometers (4 miles) north of Beijing, is the largest electronics recycling center in the Beijing area. From there, most of the electronic boards go to Guiyu County in Shantou City, Guangdong Province while home appliances containing plastic, aluminum, and copper go to Shi Jia Zhuang Village in Shi Jia Zhuang City, Hebei Province. According to the article, a manager from Huaxin Green Spring Environmental Development Company stated the reason that the underground recycling centers are more profitable than the officially registered recycling sites. He said their company makes almost zero profit after paying for the costs and the taxes on their profit. However the unregulated underground recycling sites often do not adopt proper environmental measures and they use a process that causes serious air, water, and soil pollution. According to statistics, between 50 million and 80 million electronic appliances and electronic productions are scrapped each year in China; the number is expected to exceed 160 million by 2015. The article stated that how the electronic waste can be recycled properly and how the recycling industry is managed have become major issues.
Source: Guangming Daily, July 4, 2014
http://tech.gmw.cn/2014-07/04/content_11837397.htm
China’s Growing Dependence on Foreign Energy
China Stock: Growing the RMB’s Global Presence
After the global financial crisis, a new trend developed in the world: the establishment of a "currency swap network." The U.S., in particular, established a Dollar Liquidity Swap Line among the U.S. Federal Reserve and the central banks in Europe, Canada, the United Kingdom, Switzerland, and Japan. The U.S. dollar still plays a dominant role.
China Stock published an article suggesting the steps China should take to grow the RMB’s global presence. First, China should participate in the U.S.-dominated “network of bilateral swap lines.” This would allow China to obtain dollars easily when money flows out of China. Second, China should advance the "The Chiang Mai Initiative Multilateralization" mechanism, turning this loose network of bilateral support into a tight multilateral capital rescue mechanism. Third, China should establish an RMB swap funding pool, to support the clearing of the RMB’s swap with other currencies.
Source: China Stock Online, June 26, 2014
http://news.cnstock.com/news/sns_jd/201406/3075560.htm
Central Bank: Q2 Employment Expectations Hit Three-Year Low
The Minimum Wage Went Up an Average of 14 Percent
Xinhua carried an article that was originally published in Economic Information Daily. According to the article, in the first half of 2014, the minimum wage in 12 provinces and cities went up an average of 14 percent. The Ministry of Human Resources and Social Security will soon be releasing more information. This increase is the lowest in recent years. The article stated that it was 22 percent in 2011; it was 20.2 percent in 2012; and it was 17 percent in 2013. The article also stated that, even though the “Minimum Wage Guideline” declared that the minimum wage increase was supposed to take place once every two years, from 2010 to 2014 the actual wage increases occurred once every 1.2 years.
Source: Xinhua, June 30, 2014
http://news.xinhuanet.com/fortune/2014-06/30/c_1111370014.htm
RFA: It May Cost 300 Million Yuan to Demolish a 270 Million Yuan Project Built Three Years Ago
Radio Free Asia reported that an order was given to demolish a tourist project in Hekou County, Yunnan Province that cost 270 million yuan (US$43 million) to build just three years ago. The cost of the demolition may be as much as 300 million yuan (US$48 million), which is higher than the cost of construction. The total loss of 600 million yuan is around three times Hekou County’s annual fiscal income for 2013. The report stated that the tourist project sits on the Hong River that separates China from Vietnam. It is 1 kilometer (0.62 miles) long covering 16,000 square meters (3.95 acres) and includes 150 commercial stores that can be rented. Initially, many parties objected to the project, but somehow, it was later approved at several upper levels. Currently about two thirds of the commercial space remains vacant.
Many people believe that it has become a major problem that the district government shows off its political accomplishments while wasting resources. A businessman from Guangdong Province told RFA that this is common, especially in rural areas. Another professor from the University of South Carolina said that China lacks a system to allow a stable investment environment for businesses. The government took the lead on this project and then revoked its previous commitment, a phenomenon that may harm social development.
Source: Radio Free Asia, June 20, 2014
http://www.rfa.org/mandarin/yataibaodao/kejiaowen/xql-06202014133916.html
China to Tighten Control over Land Use
On June 19, 2014, China’s Ministry of Land and Resources held a press conference to explain the new regulation issued on May 22 which will tighten control of the use of land in China.