Economy/Resources - 252. page

Xinhua reported that the Deputy of the Development and Reform Commission, Ren Pengseng, said at the China Price Forum that China should fight for more say on the pricing of bulk commodities on the global market.

Ren claimed that the Chinese economy started recovering this year, but the recovery is not reliable and the pressure of structural adjustments is mounting up. Liquidity is ample and the level of prices tends to increase. In order to improve the price control and adjustment system, it is important to enhance monitoring and reserving mechanisms and price adjustment funds.

Source: Xinhua, July 30, 2009.
http://news.xinhuanet.com/politics/2009-07/30/content_11800355.htm

The Central News Agency reported that China palms corruption chaos off on multi-national corporations. In fact, Western companies had been forced to submit to the Chinese system of corruption. Peter Navarro, a professor at the School of Business at UC Irvine, said, “In China, because of corruption, multi-national corporations are in a dilemma. Corruption in China has become a part of people’s lives.” Gordon Chang, author of The Coming Collapse of China, believes that Western companies’ submission is rooted in the Chinese Communist Party. He said, “I think in China, large-scale transactions have indeed been full of corruption and the small-scale transactions have been in the same situation. Unfortunately, the Western companies have had to do that also. The Chinese Communist Party (CCP) originally designed the system and hasn’t taken measures to deal with corruption."

Source: Central News Agency, July 26, 2009
http://www.cna.com.tw/SearchNews/doDetail.aspx?id=200907260169

Hu Jintao delivered a speech at the 11th Meeting of the Chinese Diplomatic Envoys. He emphasized the tasks of effectively coping with the international financial crisis, and ensuring economic growth, people’s livelihoods and social stability.

Wen Jiabao emphasized in his speech that China must combine expanding domestic needs with stabilizing international needs, and that China must increase its international market share. He stated that the policy of taking full advantage of international capital is still essential. Integrating the use of foreign exchange reserve and internationalization of Chinese companies, integrating the use of foreign investment and Chinese exports, integrating the Chinese currency exchange rate and the market demand/supply model are key tasks ahead.

Source: China News, July 20, 2009.
http://www.chinanews.com.cn/gn/news/2009/07-20/1783217.shtml

Study Times published an article by Jiang Dingzhi, the Deputy Secretary of the Communist Party and Deputy President of the China Banking Regulatory Commission. In the article, Jiang listed six areas to focus on when using the financial system to support economic development during the financial crisis. A few of the six areas along with Jiang Dingzhi’s points are as follows:

Promote agricultural industrialization. (We) should have both policy financing and commercial financing. (We) should construct a financial support system for large agricultural enterprises, establishing a credit and insurance system to solve the financing problems for these enterprises; fully utilize the Agricultural Development Bank’s function of administration and financing to raise investment funds to support the agricultural industrialization base and agricultural products development; improve savings institute’s services to offer more business loans, adjusting the amount of capital entering the agriculture industry; and establish cultural industrialization investment funds to effectively organize and direct private investment there.

Promote the concept of everybody doing business. (We) should actively research the “small secured loan + start business training + credit community construction” model, steadily pushing the long-term effect of establishing businesses to create employment opportunities; using circular secured loans, joint liability secured loans, and multi-guarantee secured loan methods to solve the financing challenge for small to mid-sized companies; establish funds for everybody to do business, provide loan guarantees, cover interest points, offer business rebates and awards, conduct training on starting a business, and provide services for businesses.

Source: Study Times, the 495th issue, published on July 20, 2009
http://www.studytimes.com.cn/WebPage/ny1.aspx?act=1&id=2801&nid=10204&bid=1&page=1

21cbh.com, a branch of the Nanfang Daily Media Group based in Guangdong Province, recently published a commentary on the macroeconomic data for the first half of 2009. Although the government reported a 7.9% increase in the Q2 GDP, the primary force behind the growth is still government investments in fixed assets. Consumer spending is still sliding both domestically and internationally. Trade surpluses kept dropping. While there has been a loss of balance in the domestic private economy, manufacturing and service industries are intensifying.

The commentary is primarily concerned with the bubble of asset prices. Since the 2008Q4, China has had the most accommodative monetary policies to date. In the first half of 2009, new loans reached RMB 7.4 trillion yuan, a large amount of which flowed into the stock and real estate markets instead of fixed assets. Combined with international hot money, the second half of 2009 can be considered the start of the new round of the asset price bubble.

Source: 21cbh.com, July 17, 2009.
http://e-news.21cbh.com/html/2009-07/17/content_100605.htm

Financial security is a matter of national security to China, according to Study Times. An instability in the financial system may ultimately lead to a social political crisis. “Loss of financial control means loss of control of the economy.” “By building a financial security network, we can guard against the technical attack of financial risks to China’s financial security, strengthen public confidence in China’s financial security, and safeguard our financial stability and financial security.”

Source: Study Times, July 13, 2009
http://www.studytimes.com.cn/WebPage/ny1.aspx?act=1&id=2790&nid=10103&bid=10&page=1

The Chinese Academy of Social Sciences recently published an article arguing about “Discourse Power.” The article mentioned the Chinese proposal of reforming the IMF and the World Bank. The author believed that many countries supported the idea, but it seemed China did not have much say in these organizations, which are primarily controlled by Europe, US and Japan.

The author found that, in order to conduct important reform, many international academic organizations usually provide a large amount of research help. Chinese scholars rarely participate in these processes. The article identified the lack of English skills as the primary reason.

Source: Chinese Academy of Social Sciences, May, 26, 2009.
http://www.cass.net.cn/file/20090526235133.html

Xinhua published a series of front page articles calling on all levels of regions and government bodies to be on guard against the extreme weather condition. In recent months, China has been hit by stormy and rainy weather in the south and extreme heat in the north. China Daily reported that as of July 5, 75 people had died, 13 were missing, and 39 million people were affected by the flooding in the south.

On Monday July 6, the China Ministry of Finance announced a 170 million yuan emergency fund for the southern regions, including 13 provinces that had suffered from the flood. The article calls on the regions to take the responsibility and cooperate with each other to ensure “winning the battle against the flood.”

Source:
[1] China Daily, July 6, 2009
http://www.chinadaily.com.cn/zgzx/2009-07/06/content_8380361.htm
[2] Xinhua, July 8, 2009
http://www.xinhuanet.com/politics/szch/20090708/