Economy/Resources - 247. page

Economists are concerned that the growth may not be sustainable, according to a panel discussion during a State TV program. Large State-owned enterprises saw a sharp increase in profits, according to Li Rongrong, Director of State-owned Assets Supervision and Administration Commission of the State council on April 19, 2009. In response, economists at the panel indicated that such growth was primarily fueled by preferential treatment and State monoply, thus its sustainability questionable. Others found it worrisome that 4,200 small to mid companies have been declining in contrast to the thriving large State-owned enterprises.

Source: China Central TV, April 24, 2009
http://news.cctv.com/china/20090424/101947.shtml

The State Council met on April 22, 2009 to discuss stimulus measures to stabilize the Chinese agricultural sector amid the international financial crisis, reported Xinhua. Premier Wen Jiabao presided over the Council’s executive meeting. The meeting reached a consensus that the international financial crisis is deepening and its negative impact on the Chinese agricultural sector is emerging. With global commodity demand shrinking and prices falling, the downturn of agricultural exports coupled with slack domestic growth has pushed down agricultural prices and production efficiency in China, making it increasingly difficult to maintain a stable agriculture sector and to increase farmers’ income.

Source: Ministry of Agriculture, April 23, 2009
http://agri.gov.cn/jjps/t20090423_1260834.htm

Mr. Xi Xiaoming, a senior official of the Chinese Supreme Court, recently said there has been a steady increase in withdrawal of foreign investments. Domestic private enterprises also face challenges due to the global financial crisis. 

A statement by the Chinese Ministry of Commerce indicates that the total foreign investment in January was $7.5 billion, a decrease of 32.6% compared to the same period last year.

Source: EpochTimes, April 18, 2009
http://www.epochtimes.com/gb/9/4/18/n2499031.htm

China National Radio reported that China and Russia signed an intergovernmental agreement on oil cooperation in Beijing on Tuesday. Under the intergovernmental agreement, China will provide a $25 billion loan to Russia, Russia will use oil as collateral. Russia will sell China 15 million metric tons of oil from 2011 to 2030, using the East Siberia-Pacific Ocean (ESPO) pipeline.

Energy Resources are currently the number one target of China’s overseas investment. Since the beginning of 2009 China has signed several "loan for oil" cooperation agreements with other countries, including a $10 billion loan to Brazil on February 18, a $4 billion loan with Venezuela on February 21, and a $1 billion loan with Angola on March 13. On April 5, President Correa of Ecuador announced a possible deal of exchanging crude oil for a $1 billion loan from China.

On April 16, China National Petroleum Corporation signed a contract to provide a $5 billion loan to Kazakhstan’s KazMunaiGaz National Co. to jointly buy AO Mangistaumunaigas, an oil and gas company in Kazakhstan.

Source: China National Radio, April 21, 2009
http://www.cnr.cn/gundong/200904/t20090421_505310249.html

Outlook Weekly, a magazine by Xinhua News, reported on China’s effort to restructure its international financial strategies. The core strategy is to reduce the dependency on the US dollar. This strategy consists of three aspects: internationalization of RMB, currency and financial cooperation within East Asia and international currency system reform.

The Chinese State Council decided on April 8 that Shanghai and four cities of Guangdong Province will start a trial on international settlement in RMB. Another action taken by the Chinese government was currency exchange with six countries or administrative regions.

Source: Outlook Weekly, April 15, 2009.
http://news.sohu.com/20090415/n263396439.shtml

Outlook Weekly, a magazine by Xinhua News, published an article suggesting that “there is a strongly rising public opinion that the Chinese currency RMB should become an international currency to match China’s world power status.”

The article cautioned that although the world suffered the damage brought by the US Dollar monopoly in recent years, there are still a great deal of risks for RMB internationalization. Risks mentioned in the article are: reduced capability for the central government to control Chinese macro economy, lowered stability of the economy, much heavier international responsibilities.

Source: Outlook Weekly, April 4, 2009.
http://news.sohu.com/20090408/n263256840.shtml

Xinhua reported that China’s steel exports were a mere 1.91 million metric tons in January, a drop of 54.6% from a year earlier. Exports in February went down further to 1.56 million metric tons. China Iron and Steel Association warns that China may soon import more steel than export. Slack domestic demand, reduced international orders, trade barriers in the West and competition from other countries are said to have contributed to the downturn.

On April 8, 2009, seven US steel companies and trade unions filed an anti-dumping petition against Chinese steel products with the US government. On the same day, the European Commission announced its decision to impose anti-dumping duties ranging from 15.6% to 24.2% on Chinese seamless steel pipe.

Source: Xinhua, April 14, 2009
http://news.xinhuanet.com/herald/2009-04/14/content_11183107.htm

China’s General Administration of Customs announced on April 10, 2009 that China’s total amount of imports and exports was $162 billion in March, 2009, a decrease of 20.9% from last year. Among that, exports were $90.3 billion, a decrease of 17.1% and imports were $71.7 billion, a of 25.1% decrease. The trade surplus was $18.6 billion, an increase of 41.2% over the previous year.

Source: BBC Chinese, April 10, 2009
http://news.bbc.co.uk/chinese/simp/hi/newsid_7990000/newsid_7993500/7993522.stm