Economy/Resources - 218. page

China recently appointed the top leaders of the state Sinopec Group and China National Offshore Oil Corp (CNOOC). Su Shulin, Party Secretary and General Manager of Sinopec, was appointed Deputy Chief of the Party Committee in Fujian Province. Fu Chengyu, Party Secretary and General Manager of CNOOC, was appointed Party Secretary and Chairman of Sinopec. Wang Yilin, Deputy Manager of China National Petroleum Corporation (CNPC), was appointed Party Secretary and Chairman of CNOOC. China is also using this opportunity to set up a board of directors at the two state oil giants, although their subsidiaries listed in domestic and overseas stock markets already have boards. Sometime later, a board will also be created for CNPC.

Source: Beijing News, April 12, 2011
http://epaper.bjnews.com.cn/html/2011-04/12/content_219795.htm?div=-1

Xinhua recently reported on The Symposium Celebrating the 90th Anniversary of China’s Sailors’ Union in Beijing. The article stated that China now has over 1.55 million sailors; of those, 650,000 are seamen. Today, 93% of the transportation used for Chinese import and export industries is sea-based. Over 95% of all oil and 99% of all ironstone rely on water transportation. Currently, the scale of China’s water transportation fleet is the fourth largest in the world. It includes 184,000 vessels, which translates into a transportation capacity of 124 million tons. Mainland China now has 12 out of the world’s top 20 ports with an annual freight handling capacity of over one-hundred-million tons.

Source: Xinhua, April 6, 2011
http://news.xinhuanet.com/politics/2011-04/06/c_121273093.htm

Source:
Xinhua, April 8, 2011
http://news.xinhuanet.com/2011-04/08/c_121283512.htm
http://www.nexteer.com

An article in Study Times listed six weaknesses that affect China’s manufacturing industry. They are: 1) An over-reliance on a low-cost production environment; 2) Being locked up in low-end markets; 3) An overcapacity in low efficiency production; 4) Chinese companies are not competitive; 5) The cost advantage is gradually diminishing due to growing labor costs; 6) The trade model based on processing raw materials cannot be sustained.
 
Source: Study Times, April 4, 2011
http://www.studytimes.com.cn:9999/epaper/xxsb/html/2011/04/04/12/12_38.htm

A China Review News article suggests that the rising price of grain is looming as a national security issue for China. The world is experiencing the most dramatic commodity price hikes in three decades. Grain prices, along with oil prices, are hitting record highs. Grain markets have become part of the composite global financial system, intertwining with markets for capital, foreign exchange, futures, and other financial derivatives. Grain prices are vulnerable to the global capital flow. The recent Middle East crisis is pushing the oil and grain price spiral even higher. The article suggests that China elevate grain production and financing to a national strategic level by applying tight control over the production and sales chain, gaining power over pricing, stipulating relevant policies, setting up a grain investment and reserve bank, and developing grain related financial markets.

On March 30, 2011, CNOOC (China National Offshore Oil Corp) announced that it had signed an agreement with U.K.’s Tullow Oil to acquire a one third interest in the company’s three drilling areas in Uganda. The transaction is a cash deal amounting to about US$1.467 billion. It is expected to close in the first half of 2011.

Source: China News Service, March 30, 2011
http://www.chinanews.com/ny/2011/03-30/2941922.shtml

Premier Wen Jiabao reiterated Beijing’s support for Hong Kong to become the RMB offshore center, suggesting that Hong Kong should lead China’s financial reform. According to Hong Kong’s monetary authority, in 2010, a total of 36 billion yuan (US$5.5 billion) in RMB bonds were issued. China Merchants Bank President Ma Weihua said earlier this month that Hong Kong’s RMB deposits totaled 370.6 billion and may hit 2 trillion in five years. 

On March 14, 2011, after the closing of the Fourth Session of the National People’s Congress in Beijing, China’s Premier Wen Jiabao told Chinese and foreign reporters at a press conference that “there is no instance where state-owned enterprises are advancing while private ones are declining.” He supported his statement by enumerating two State Council papers issued in 2005 and 2010 respectively, although he acknowledged that “implementation was inadequate.” At the same time, Wen emphasized “although the percentage of the state-owned economy is lower, it still holds the country’s economic lifeline.” Days earlier, on March 10, 2011, Wu Bangguo, Chair of National People’s Congress, had emphasized in his report that China will never adopt privatization of the economy.

Source: China News Service, March 14, 2011
http://www.chinanews.com/cj/2011/03-14/2904086.shtml