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Economy/Resources - 214. page

Chinese RMB Becoming Hard Currency?

Chinese currency is quickly being adopted as settlement currency, claimed International Herald Leader under Xinhua on February 16, 2009. Since Dec 2008, China has entered into agreements with eight of its neighboring countries including Vietnam, Myanmar, Russia, Mongolia and South Korea to use Chinese RMB as settlement currency. On Feb 8, 209, China entered into a currency exchange agreement with Indonesia worth 80 billion yuan which allows Indonesians to borrow RMB at banks in Indonesia. China views the international financial crisis an opportunity to “internationalize” its currency to make further inroads into the international economies.

Source: Xinhua, February 16, 2009

Study Times: China To Internationalize Its Currency

China should take advantage of international financial crisis and push to “internationalize” the Chinese Renminbi, says Study Times, journal of the School of the CCPC February 16, 2009. The article takes note of recent State Counsel decisions on using RMB in settling commercial transactions with Hong Kong. The current international crisis has lowered the net worth in the U.S. dollar and the esteem the international communities has held for the U.S. dollar. The article recommends expanding pilot programs to use RMD as settlement currency.

Source: Study Times, February 16, 2009

China’s Agriculture Hit by International Crisis

2009 will likely be the most difficult year for Chinese agriculture in the 21st century, according to No. 1 Notice of the Chinese Communist Party and State Council on February 1, 2009. “At present, the international financial crisis continues to spread and the world economy is slowing down significantly. The negative impact on our Mainland China’s agriculture and countryside development has constantly emerging, said the document issued through Xinhua.

Source: China Ministry of Finance, February 2, 2009

Negative Growth in 2009 if No Significant Increase in Government Expenditure

China must increase its expenditures from 4,000 billion to 10,000 billion Yuan to avoid negative growth, said Study Times, the publication of the Party School of CPC, on December 29, 2008. The current cycle of investment has run its course. It is clear next year’s investment will be around –10%, a reduction of 1,000 billion to 1,500 billion yuan. The previously announced 4,000 billion yuan government expenditure for 2009 and 2010 will not offset the decrease of the market demand. Moreover, exports in 2000 will likely see a growth of -10 to -20%.

Source: Study Times, December 29, 2008

Domestic Demand Sluggish

Nanfang Weekend published an article on sluggish domestic demand in the Chinese economy. According to the article, if one produces the value of 100 yuan, 45.4 yuan would go to one’s own pocket, while 23.1 would be State’s fiscal revenue and 31.5 would go to capital and inventory of companies. In the past 30 years, per capita income has been increasing. But the GDP growth rate exceeds that of the per capita income, leading to weak domestic demand, concluded the article. 

Source: Nanfang Weekend, December 18, 2008

377,00 Chickens Culled; H5N1 Avian Flu Found

Agricultural authorities have killed 377,000 chickens after an outbreak of bird flu in two areas of Jiangsu province, said the Ministry of Agriculture. The Ministry said it received information about H5N1 infection among hens in Dongtai and Haian on Monday December 15, 2008.

Source: Ministry of Agriculture, December 16, 2008