Chinascope – Page 738

Ministry of Finance: State-owned Enterprises Have Liabilities to Asset Ratio of 65 Percent

On September 22, 2014, China’s Ministry of Finance released the economic performance report on State-owned enterprises for the period of January through August.

The report showed that, as of the end of August, the value of State-owned assets exceeded 99 trillion yuan, with total liabilities at nearly 65 trillion yuan; the ratio of liabilities to assets was 65 percent. The central government owned enterprises showed high financial expenditures. In the first eight months of the year, these grew by 22.4 percent.

The report also showed that, compared to the same period last year, the rate of growth of both the revenues and profits in these State-owned enterprises continued to decline. Costs, however, continued to increase faster than revenue.

Source: China Business News, September 23, 2014

http://www.yicai.com/news/2014/09/4021971.html

Briefings | | September 25, 2014 | Economy/Resources

Foreign Ministry Spokesperson on the Sino-Russian Military Alliance Issue

On September 17, Hong Lei, the spokesperson for the Foreign Ministry, was answering reporters’ questions. A news reporter asked, “Yesterday, a Russian congressman suggested that the Western’ sanctions against Russia will push Russia and China to establish a military alliance. What is China’s response?”

Hong replied, “The Sino-Russian comprehensive strategic cooperative partnership will not have an alliance, we will not confront each other, and we will not target third-parties. China will adhere to its strategic cooperative partnership position. [China will,] with Russia, continuously increase our strategic trust, promote mutually beneficial cooperation, and strengthen our cooperation on international and regional affairs.”

Hong also stated, “On the Ukraine issue, sanctions will not solve the problem. The issue will ultimately be handled through a political resolution.”

Source: Xinhua, September 17, 2014
http://news.xinhuanet.com/world/2014-09/17/c_1112522728.htm

Briefings | | September 24, 2014 | Geo-Strategic Trend

People’s Daily: Housing Prices Cooling Down

People’s Daily recently reported on the housing market data that the National Bureau of Statistics just released. According to the official statistics, out of seventy large and medium sized cities, sixty-eight saw a month-over-month housing price decline. One city broke even and another had an increase. The seventy-city average price for new real estate fell by 1.2 percent month-over-month, which is the biggest decline in ten years. Traditionally, September is the peak month of the year for the housing market. However there is no sign of recovery as of now. Market analysts thought that it was the high inventory level and a significantly lower demand that had caused the decline. Several provincial governments have come up with new local policies to “rescue” the housing market. It is widely expected that at least ten more provinces will follow suit.

Sources: People’s Daily, September 19, 2014

http://finance.people.com.cn/n/2014/0919/c1004-25690606.html

National Bureau of Statistics, September 18, 2014

http://www.stats.gov.cn/Tjsj/zxfb/201409/t20140918_611639.html

Briefings | | September 23, 2014 | Economy/Resources

Ministry of Commerce: Foreign Direct Investments Fell by Fourteen Percent

Well-known Chinese news site Sina recently reported that the Ministry of Commerce briefed the media in a press conference on the state of the economy as of August. According to the Ministry, the August number for Foreign Direct Investments (FDI) was US$7.2 billion, which represents a year-over-year decline of 14 percent. Another focal point was, for the first eight months of 2014, total actual foreign investments in the manufacturing industry declined by 15.7 percent year-over-year, down to US$27.5 billion. The top ten foreign investment sources were Hong Kong, Taiwan, Singapore, Korea, Japan, the U.S., Germany, the UK, France and the Netherlands. Noticeably, investments from Japan, the U.S. and the EU suffered declines of 43.3 percent, 16.9 percent and 17.9 percent, respectively.

Source: Sina, September 16, 2014

http://finance.sina.com.cn/china/hgjj/20140916/100520304349.shtml

Briefings | | September 23, 2014 | Economy/Resources

BBC Chinese: HK Poll Showed Half of the People Do not Support Political Reform Proposal

BBC Chinese recently reported that the South China Morning Post conducted a scientific poll on the recent government-proposed reform of the political system that determines how the Chief Executive of Hong Kong will be elected. The Standing Committee of the National People’s Congress approved the proposed reform. However the Hong Kong Legislative Council has to pass the proposal before it can become law. According to the results of the poll, 48 percent of the sample thought that the Legislative Council should veto the proposal. Thirty-nine percent said it should pass. Thirteen percent of the people surveyed were unsure. Among all of the people who responded to the poll, 70 percent of those between 18 and 29 years old favored a veto; 50 percent of those between 30 and 49 years old supported a veto; 37 percent of those who are 50 or older supported a veto. The proposed reform includes a “filtering mechanism” to limit the candidacy.

[Editor’s note: Beijing has rejected open nominations in favor of having a nominating committee select who can run.]

Source: BBC Chinese, September 15, 2014

http://www.bbc.co.uk/zhongwen/trad/china/2014/09/140915_hongkong_democracy.shtml

Briefings | | September 23, 2014 | Geo-Strategic Trend

Chinese Economists on Compensation Reform in State Owned Enterprises

China Economic Online published an article on the general concern that reform is needed in setting the annual compensation scale for the top managers in State Owned Enterprises (SOE). According to the article, those managers are paid, on average, five times more than their peers in private sectors. In addition, their compensation does not line up with their job performance. The SOE’s are also under the management of the State-Owned Assets Supervision and Administration Commission (SASAC). The article said that the commission’s effort to reshape the board of directors in SOE’s has been unsatisfactory so far. It quoted one Chinese economist who stated that the compensation adjustment effort will involve changes in other areas first: who should set the pay scale and who can make the final call – the board of directors or SASAC? According to the economist, it requires that the government function should be separated from the enterprise management. "The enterprise should be under the management of diversified equity and mixed ownership." He recommended that, "The board members in the SOE’s should be independent, professional, and have accountability."

According to the article, based on the list of compensation in 2013 for the board of directors of the SOE’s, as published by China Economic Research Institute, 259 SOE’s are publicly traded companies. The average annual compensation in 2013 for 83 of the chairmen of the board who received compensation was 840,630 yuan (US$136,894) while 19 of them had annual compensation of over one million yuan (US$162,853). The top management in the financial and banking industry had the highest pay with annual income averaging 940,000 yuan (US$153,077), while the chairmen of the board and bank CEOs were paid at 1.71 million (US$ 278,470) and 2.35 million (US$382,692) respectively.

Source: China Economic Online, September 21, 2014
http://www.ce.cn/cysc/newmain/yc/jsxw/201409/21/t20140921_3570080.shtml

Briefings | | September 22, 2014 | Economy/Resources

China National Coal Association Will Continue to Limit Production and Reduce Imports in Q4

China Financial and Economic News reported that, according to China National Coal Association, the coal industry in China continues to suffer hardship. Currently close to 70 percent of the coal enterprises have to make pay cuts and 30 percent of the coal companies are in arrears on paying wage. With 300 million tons of coal in their inventory on hand, the Association said it will continue to limit production in Q4 in order to bring the coal price back up, hopefully by 20 percent. The association also proposed to reduce coal imports by 20 million tons in the 4th quarter of 2014. According to the statistics, coal production in the first 8 months of 2014 was 2.5 billion tons, down 1.44 percent from the same period in 2013; sales were 2.4 billion tons, down 1.62 percent from the same period in 2013.

Source: China Financial and Economic News, September 22, 2014
http://economy.caijing.com.cn/20140922/3705114.shtml

Briefings | | September 22, 2014 | Economy/Resources

Wu Guoguang: Xi Jinping’s Reversal of the Course, Will China’s Transition be Peaceful or Marked with Bloodshed?

Cheng Xiaonong: U.S.-China Strategic Relations Have Crystallized

Xinhua Commentaries: “Exposing the Three Major Political Deficits of the U.S.”

The CCP’s Performing Arts Troupes in the U.S.