Economy/Resources - 222. page

On January 3, 2100, the International Herald Leader, a newspaper under Xinhua News Agency, published an  article titled “The Currency War, Win the Two Battles inside and Outside (of China).” It included several interviews.

Tan Yaling, President of the China Foreign Exchange Investment Research Institute, told Xinhua reporters, “I would like to take the initiative to devalue the RMB, choosing a good time to take action, so as to remove any expectations for RMB appreciation. We cannot let the expectation for RMB appreciation kidnap public opinion in the market and (affect our) policy parameters.”

Guo Tian Yong, Professor of the Central University of Finance and Director of the China Banking Research Center, said, “Substantial appreciation of the Renminbi in the short term is the ‘dog in the manger.’” In his opinion, China should control the pace of RMB appreciation and “let the RMB appreciate modestly and gradually.”

Source: International Herald Leader, January 3, 2011
http://news.xinhuanet.com/herald/2011-01/03/c_13675030.htm

Sun Lijian, Vice President of the School of Economy, Fudan University, published an article analyzing the (anticipated) economic pressures on China in 2011. The article says that “three big issues, both inside and outside” of China are of concern: The pressure from the instability of the international currency system, the pressure from the “virtualization” of industrial capital, and the pressure from the “imbalance” in income distribution.

Source: China Review News, January 7, 2011
http://gb.chinareviewnews.com/doc/1015/6/2/7/101562738.html?coluid=53&kindid=0&docid=101562738&mdate=0107082119

People’s Daily Online published an article about promoting Chinese literature to the world. The article advocated that “Chinese literature should have worldwide significance” and “as our economy has achieved great success, (Chinese) literature should have a worldwide view.”

The article suggested that creating literature needs innovation. “The first innovation is the concept of our national literature.” “(We should) absorb multi-dimensional cultural nutrition from the world” to create literature for the world. “The second is to establish confidence in our national literature.” “The third innovation is to create a new format for our national literature.”

Source: People’s Daily Online, December 31, 2010
http://culture.people.com.cn/GB/87423/13627724.html

Yin Jianfeng, Director of the Financial Research Center, Institute of Finance and Banking, Chinese Academy of Social Science, stated that China should avoid the Japanese yen’s mistake when pushing the yuan as an international foreign exchange reserve. Yin argued that the yen failed as an international currency due to Japan’s weak financial system, its high domestic savings rate, and the lack of an offshore trading center.

To push the yuan to go worldwide, Yin suggested using Asian countries, excluding Japan, to break into the international market, since China’s trade with these countries accounts for nearly 50% of its imports and 38% of its exports. “Hong Kong should be the yuan’s offshore international financial center.” “Trade in yuan should first start in Southeast Asia, with Hong Kong as the Southeast Asia yuan investment and trade center.”  

Source: Xinhua, December 20, 2010
http://news.xinhuanet.com/2010-12/20/c_12900744.htm

On December 19, 2010, Xinhua reported that the Ministry of Land and Natural Resources had just released new regulations requiring local government branches to enforce real estate administrative policies and to “decisively” stop the recent rapid increase in land prices. The Ministry pointed out that the health of the current real estate market is “facing a complex situation.” The entire society can see how land prices have been increasing in a number of cities. The Ministry called for “strong strikes” against land hoarding and speculation. The new regulations also prohibit changing the use of land into government-subsidized land for low-income housing projects.

Source: Xinhua, December 20, 2010
http://news.xinhuanet.com/2010-12/20/c_12896352.htm

Guangming Daily recently published an article discussing issues related to China’s national financial safety, which is considered to be the core of economic safety. The article expressed concern that financial globalization has resulted in an increase in negative economic fluctuations. The author believes that there are four elements that endanger the Chinese economy: (1) hot money, or unemployed capital; (2) financial innovations that lead to instability; (3) strong pressure that results from China’s foreign exchange reserves; (4) an incomplete financial system in China’s rural areas. The article called for long-term positioning of the Chinese currency (RMB), improvements in financial market administration, and increased investment in social security systems.

Source: Guangming Daily, December 20, 2010
http://epaper.gmw.cn/gmrb/html/2010-12/20/nw.D110000gmrb_20101220_4-10.htm

Government specialists and economists were interviewed for an article in Xinhua analyzing the direction of China’s economy in 2011. The following are highlights of the major points:

– China will face inflation next year, mainly caused by international inflation.
– China’s monetary policy will change from “loosened” to “neutral,” but not “tightened.”
– Once the government’s stimulus package has run its course, China will have to work through the private sector to drive its economic growth.
– The real estate market will drop slightly, but not significantly.
– The income disparity between China’s rich and poor will widen even further.
– China’s export business will continue to grow.
– The yuan will rise slightly.

Source: Xinhua, December 17, 2010
http://news.xinhuanet.com/herald/2010-12/17/c_13653229.htm

Xinhua reported that the State Grid Corp. of China will spend $989 million to buy seven Brazilian power distributors. State Grid owns a 30-year concession, with another 20-year renewal, to distribute power to Brazil’s southeastern region, the most economically advanced area, which includes major cities such as Rio de Janeiro, Sao Paulo, and Brasilia.

“The deal for the seven Brazilian power distributors is expected to generate more than $110 million in annual earnings for State Grid Corp. It will also open markets for China to sell machinery to South America and to construct electricity projects there.”

Source: Xinhua, December 21, 2010
http://news.xinhuanet.com/2010-12/21/c_12900736.htm