Economy/Resources - 186. page

On June 8, 2013, the Hong Kong-based Mirror Books published an article titled, “Chinese Real Estate Industry May Have Become the Biggest Money-Laundering Channel.” “Not only is there money laundering; it is a double shameless plunder. The first plunder is corruption. It is a second plunder when officials invest the money collected through their corrupt acts and channel it into real estate, thus causing housing prices to rise.”

According to the Central Commission for Discipline Inspection of the Communist Party of China, since November 2012, there has been a new trend of selling luxury homes and villas. Many government officials, especially those in Guangzhou and Shanghai, have undersold their luxury homes. In Guangzhou and Shanghai, officials put up 4,880 and 4,755 luxury homes for sale, respectively. Of those public officials who left China from the Mid-Autumn Festival to October 1, 2012, more than 1,100 of them did not return to China on time and 714 of those 1,100 officials have been categorized as having fled China. In 2010, the outflow of illegal money from China was US$412 billion. In 2012, it was US$600 billion. It has been estimated that, in 2012, US$1 trillion was transported overseas. In 2013, the illegal funds that have fled China has reached US$1.5 trillion.

Source: Mirror Books (http://city.mirrorbooks.com) , June 8, 2013
http://city.mirrorbooks.com/news/?action-viewnews-itemid-88522

After a screening of 1,907 of the world’s top technologically innovative, talented people in six fields, including biological and biochemistry, computers, physics, agriculture, mathematics, and chemistry, the Chinese Academy of Sciences found that China has the leading edge in physics, mathematics and computer science. However, the number of China’s most talented who have been lost tops the world. An average of 87 percent of those in the science and engineering fields have chosen to stay overseas. An official from the Central Talent Work Coordination Group Office pointed to several problems that China has: a shortage of high-level, innovative, creative talent; a lack of innovation capabilities, and a mismatch between the demand for and the supply of talent.

In this current "war for talent," many developed countries are using immigration reform to attract or retain talented people. In recent years, nearly a million overseas Chinese students have chosen to return to China under the "thousands of people plan," including over twenty thousand with high-level talent.

Source: Xinhua, June 6, 2013
http://news.xinhuanet.com/2013-06/06/c_124820431.htm

On June 4, 2013, China’s Ministry of Environmental Protection (MEP) released a report on China’s environment. According to the report, pollution has resulted in the poor quality of the water and air in China. Of a total of 113 environmentally protected cities, only 23.9 percent meet acceptable air quality criteria.

The rural environment, including drinking water and air, suffers different degrees of contamination. Last year, China’s emission of chemical oxygen and its ammonia emissions was 24.2 million tons and 2.54 million tons respectively. Rural pollution has resulted in food safety problems. For example, not long ago, Guangdong Province had to admit that their rice contained heavy metals that had exceeded safety criteria.

Source: BBC Chinese, June 4, 2013
http://www.bbc.co.uk/zhongwen/simp/china/2013/06/130604_china_environment_rural.shtml 

According to the Chinese Luxury Traveler White Paper that the Hurun Report released on June 4, 2013, this is the third consecutive year that Chinese tourists have ranked first in the global shopping market. Chinese tourists’ overseas consumption in 2012 grew rapidly at the rate of 57 percent over 2011, while the global tourists spending rate growth remained at around 30 percent. The average amount that Chinese travelers spend per trip is 71 percent higher than the global average.

Source: Beijing News, June 4th, 2013
http://www.bjnews.com.cn/finance/2013/06/04/266929.html

Time Weekly published an article on how residents can become creditors of local governments when city commercial banks act as the middleman.

In China, only the central government can issue bonds. Local governments do not have the authority to issue bonds. However, there is a proven and popular mechanism that local governments use the enable residents to become the creditors of local governments.

First, the local government establishes an investment company; this is the “Local Government Financing Platform.” Then the local government announces new infrastructure programs such as highways, airports, or office buildings. The financing platforms proceed to contact local city commercial banks for loans to fund these programs. Because the financing platforms are government backed and the loans fund government programs, the loans are issued smoothly. However, fully aware of the risks, the city commercial banks turn around and sell the debts to trust companies which re-package the loans into “financial products.” The trust companies ask the city commercial banks to promote these “financial products” to customers of the banks. The salespersons at the banks review resident’s bank accounts and then start making sales calls. Soon residents find that they themselves have become creditors of the local government.

[Editor’s note: The city commercial banks are a significant group in the Chinese banking market. Most of them used to be urban credit cooperatives. In 1998, the People’s Bank of China ordered that all urban cooperative banks change their name to city commercial banks. These banks have strong ties to their local government, are majority or wholly state owned, and are known for financing local infrastructure and other government projects.]

Source: Time Weekly, May 30, 2013
http://time-weekly.com/story/2013-05-30/129859.html