Skip to content

Economy/Resources - 198. page

Cancer Village in Shaoyang: Over 30 Died of Cancer in 10 Years

Yuxi is a small village from She-tian-qiao Town of Shaodong County. It used to be famous for the high quality of its chestnuts and radishes. Now no one wants the chestnuts and radishes from Yuxi. Since 2003 more than 30 people from Yuxi have died from cancer. Previously, cancer was very rare in the village. The villagers believe that this change started when the Xinlong glassworks factory moved to the village.

A reporter observed that the factory was near the village’s farmland. Almost everything within eyesight was contaminated by the pollution from waste water having a dark-black color. Villagers told reporters that, after Xinlong built the factories, highly polluted sewage water was discharged into the river almost every day.

Since 2007, the villagers have been collecting a lot of evidence that Xinlong glassworks illegally discharged sewage. They reported the discharge to the environmental protection department, but never got a reply.

Villagers went to the Shaodong EPA to appeal. Wang Xiran, head of Shaodong EPA, told them, “Xinlong glass factory does have pollution, but with the tens of millions they produce each year, it is not something we can close just because we want to."

Source: Xinhua, June 28, 2012
http://news.xinhuanet.com/politics/2012-06/28/c_123342343.htm

Briefings | | |   Economy/Resources

China Academy of Science Found Misusing Rearch Funds

In 2011, the Institute of the state owned China Academy of Science (CAS) distributed morale and welfare benefits to employees using program funds in an amount totaling almost 100 million yuan. Liu Jiayi, Auditor General of the National Audit Office of China, indicated that, in 2011, nine CAS institutes were found to have engaged in such practices, including the following institutes:

The Institute of Geographic Sciences and Natural Resources Research: 25.68 million yuan
The Institute of Zoology: 20.06 million yuan
The National Space Science Center: 17.07 million yuan
The Institute of Biophysics: 12.78 million yuan (from 2009 to 2011)
The Academy of Mathematics and Systems Science: 8.4 million yuan
The Institute of Electronics: 7.3 million yuan
The Institute of Psychology: 1.8 million yuan

Source: China Business, June 28, 2012
http://www.cb.com.cn/1634427/20120628/390263.html

Briefings | | |   Economy/Resources

CRN: State Owned Companies’ Profits Are Declining

China Review News (CRN) recently published a report on the Ministry of Finance’s newly released numbers. The numbers showed that, during the period from January to May, the total profit of all state-owned companies declined 10.4% compared to the same period last year. The monthly decline from April to May was 11.8%. The Ministry expected a continuation of the decline in the near future. The report expressed the belief that the main cause of the decline was the combination of a weakened international market and low domestic demand. The domestic consumer market is very weak due to higher living costs. Another reason for the profit decline mentioned in the report was the disappearing benefits that resulted from the earlier large stimulation package that the government initiated after the global financial crisis started in the U.S. The report also identified three operational issues: (1) state-owned companies actually had a total income increase while suffering a total profit decline; (2) internal costs such as wages increased rapidly; (3) only companies with monopoly power saw their profits increase.
Source: China Review News, June 19, 2012
http://www.zhgpl.com/doc/1021/4/4/9/102144962.html?coluid=53&kindid=0&docid=102144962&mdate=0619075811
Briefings | | |   Economy/Resources

Outlook Weekly: How to Reform China’s Financial Safety System

Outlook Weekly, a weekly magazine under Xinhua, recently published an article on the way to establish a new system to ensure China’s financial safety. The article identified four major relationships to focus on: (1) the relationship between financial risks and economic development; (2) the relationship between financial openness and financial protection; (3) the relationship between financial freedom and government monitoring and administration; (4) the relationship between speed versus profit, and scale versus quality. 
The article discussed six strategic components of financial safety: (1) controlling the risk in international capital flows; (2) enhancing financial monitoring and administration; (3) coordinating currency policies; (4) examining the goal of currency exchange rate policies; (5) reforming foreign currency management; (6) adjusting international payment balances. 
The article called for four operational actions: (1) adjusting the government’s role; (2) developing a new financial theory to handle the new situation; (3) ensuring financial stability; (4) deploying new risk control measures.
Source: Outlook Weekly, June 4, 2012
http://news.sohu.com/20120604/n344722898.shtml
Briefings | | |   Economy/Resources

CRN: China’s Manufacturing Industry Is Actually Weak

China Review News (CRN) recently published a review by Zhou Yanwu, the Chief Research Officer of an industrial research institute, Research in China. The review gave a few examples to demonstrate the weakness in China’s manufacturing industry. One example was automobile seats, which, (instead of the engine) are the most costly component in a regular car. The 10 top manufacturers hold 95% of the world market, but not one of them is a Chinese company. Another example was paint and coating products. Although China is the largest producer in the world, in 2010, all 2,749 large-scale Chinese companies in this industry made a total profit of US$2 billion. This amount equals the profit of one U.S. competitor – PPG. At the same time, the company that holds the largest share of China’s domestic paint and coating market is a Japanese vendor named Nippon. A third example was the LED industry. China has over 1,000 companies in this category. Their total income is only half that of their Japanese competitor, Nichia. On the profit side, the total of the profits that these Chinese companies receive equals only 20% of Nichia’s profits. The author concluded that China is a big manufacturing country, but it is also a very weak one.
Source: China Review News, June 19, 2012
http://www.zhgpl.com/doc/1021/4/4/9/102144949.html?coluid=53&kindid=0&docid=102144949&mdate=0619074950
Briefings | | |   Economy/Resources

People’s Daily: China’s Social Security Consumes 40% of Wages

People’s Daily recently reported that, according to the Ministry of Human Resources and Social Security, the current five pre-tax payment items in the social security account take 40% of a normal taxpayer’s wages. This indicator ranks number one out of all 181 countries. It is 3 times the level of the five Northern European countries, 2.8 times the level of the G7 countries, and 4.8 times the level of the East Asian countries. Meanwhile the current social security funds have a shortfall of a total of RMB 1.76 trillion. A survey was conducted on the recent plan to extend the retirement age. Of those surveyed, 93.9% opposed the plan. Only 2.4% of the people supported it. The  People’s Daily Network conducted the survey. The report ended by calling for major reform of the current social security system and the establishment of a retirement management option like the 401K model in the United States.
Source: People’s Daily, June 15, 2012
http://finance.people.com.cn/insurance/BIG5/18192058.html
Briefings | | |   Economy/Resources

Next Year, the Shortage in China’s Pension Account Will Reach 18 Trillion Yuan

A recently released research report "to resolve the mid to long-term risk to the nation’s account for asset liabilities” predicted that the gap between the amount in the Chinese pension account and the amount due to be paid out will reach 18.3 trillion yuan [~US$3 trillion] in 2013. The report notes that, due to the impact of China’s aging population, the  co-ordinated pension account will be a huge burden for the nation’s finances. Actions have been recommended to relieve the pressure, including delaying the retirement age; allocating state-owned shares; and reforming (the retirement policies) of government departments and institutions.

The study was a joint effort between the Bank of China research team, led by Cao Yuanzheng, the chief economist for the Bank of China, and the Fudan university research group, led by Ma Jun, the chief economist for the Greater China area of Deutsche Bank.

Source：Xinhua，June 14，2012
http://news.xinhuanet.com/politics/2012-06/14/c_112210997.htm

Briefings | | |   Economy/Resources

HSBC PMI for China’s Manufacturing Sector Continues to Decline

CNForex recently reported that HSBC reported the official May PMI (Purchasing Managers Index) number for the Chinese manufacturing sector to be 48.4. The index has remained under 50.0 for 7 consecutive months, which indicates that the manufacturing sector has been shrinking. It is believed that the PMI number reflects that the current economy is suffering from weak domestic and international demand, causing manufacturing companies to have a reduced output. Statistics show that, in May, these companies employed the lowest number of laborers in the last 3 year. The unemployment rate in this sector is increasing. Also in May, inventory declined and product prices dropped. PMI is an indicator of financial activity; it reflects purchasing managers’ acquisition of goods and services. A PMI number below 50 typically is an indication of decline.

Source: CNForex, June 1, 2012
http://www.cnforex.com/news/html/2012/6/1/f28feb312993372e1fe7438418ded68d.html

Briefings | | |   Economy/Resources