On April 20, 2013, the Ministry of Land and Resources issued the 2012 China Land and Resource Communique. It disclosed that close to 60 percent of China’s underground water was rated poor. Of the sites tested, 16.8 percent were found to have extremely poor water quality. The study was conducted by checking the underground water quality at 4,929 testing sites in 198 regions.
Source: Xinhua, April 20, 2013
http://news.xinhuanet.com/local/2013-04/20/c_115468685.htm
Zhang Ke, Vice President of the Chinese Institute of Certified Public Accounts and chairman of the Beijing based ShineWing (HK) CPA Limited said during an interview with Financial Times that due to concerns about risks, his firm has ceased its audit businesses relating to local governments’ issuance of bonds. “The situation is out of control.”
“We have audited the bonds that some local governments have issued. We found they were very high risk, so we withdrew.” Zhang continued, “Most local governments do not have the ability to pay back the principal or service the debt. Things could become very serious.”
Zhang also said, “The situation is out of control. There may be a crisis. However, because the due dates on these debts keep getting extended, they have become long-term debts. Therefore, the timing of the burst is uncertain.” He indicated that, from public squares to road improvements, many local governments have put money into investments and received mediocre returns. Now they can do nothing but borrow new money to pay old debts. Zhang said, “This approach will not survive much longer. … When that time comes, it will not be the government but CPA firms and banks that will bear the ultimate responsibility.”
The Beijing based ShineWing (HK) CPA Limited claims that it is the largest domestic CPA firm in China.
Source: Caijing.com, April 17, 2013
http://economy.caijing.com.cn/2013-04-17/112682959.html
According to the 2013 Hurun Report released on April 15, 2013, the number of super-rich Chinese, defined as individuals with a net worth of 100 million yuan, grew two percent to 64,500 individuals, the slowest growth in the past four years. Beijing is home to more millionaires than any other city in China, accounting for 475,000 millionaires (in US dollars), followed by Shanghai with 390,000.
Eighty percent of these people are business owners, 15 percent are real estate investors, and five percent are day traders in the stock market.
These estimates of the 2013 Hurun Report are based on the macro-statistics from the National Bureau of statistics of China and on micro-statistics, including ownership of luxury homes and automobiles, income tax returns, sales of other luxuy items and registered capital of businesses.
Source: Xinhua, April 18, 2013
http://news.xinhuanet.com/overseas/2013-04/18/c_124595059.htm
On April 15, 2013, China Review News published an article on the direction of China’s economic development during 2013. According to the article, the new direction of China’s economic and social development in 2013 includes the quality of economic growth and the security of the people’s livelihood.
Following an economic growth of 7.5 percent in 2012, the goal for economic growth in 2013 was once again set at 7.5 percent. China must be vigilant about inflation. The current inflation rate is 3.5 percent. Therefore, the regulation of the economy in 2013 should focus on the application of monetary policy, stabilizing the prices of real estate and agricultural products, and on other related functions.
Resource: China Review News, April 15, 2013
http://www.zhgpl.com/doc/1025/0/2/8/102502820.html?coluid=53&kindid=0&docid=102502820&mdate=0415143926
Xinhua reported that, on April 13, 2013, China’s Income Distribution Research Center published the results of its research on the distribution of income in China. The results suggested that the largest disparity in income was found to be between those who live in cities and the countryside, while the gap continues to grow between various regions and professions. According to the results, the professions in the service industry along with agriculture, forestation, herding, and fishing are among the lowest in income level, while electricity, telecommunications, and the financial insurance industries are in the top income bracket.
Source: Xinhua, April 14, 2013
http://news.xinhuanet.com/politics/2013-04/14/c_124577901.htm
According to People’s Bank of China’s latest release, in March 2013, M2, China’s broadest measure of money supply, reached 103.61 trillion yuan for the first time. Over the past 10 years, China’s M2 money supply has risen sixfold from 13 trillion yuan in 2000. It was just below 50 trillion yuan in 2008. However, starting in 2009, M2 increased 10 trillion every year. In 2012, it exceeded 97 trillion.
Currently, the ratio of China’s M2 to GDP is close to 190 percent. This number brings to light a clear acceleration when compared to recent years. It reflects the reality of a decreased return on investment and a narrowing path of economic growth driven by money supply.
Source: People’s Daily, April 12, 2013
http://www.people.com.cn/24hour/n/2013/0412/c25408-21108374.html