Chinascope – Page 775

Sporting Goods Store Closures Continue with High Inventories

During the economic downturn in China, stores for sporting goods with brand names faced their second round of closures in two years. In 2013, six well-known brand name sporting goods closed over 3,000 of their stores; inventories reached 3.1 billion yuan in 2013.

In 2013, Lining, Anta, Peak, 361 Degrees, China Dongxiang, and Xtep closed over 3,000 stores. 361 Degrees was hit the hardest with 783 closures. Xtep shut down 150 stores and was the least affected brand. Back in 2012, during the first round of closures, Lining and Peak alone closed over 1,000 stores.

The inventory for all six brands remained high, hitting 3.1 billion yuan in 2013: Lining (942 million), Anta (689 million), Peak (366 million), 361 Degrees (409 million), China Dongxiang (183 million) and Xtep (537 million).

Sources:

Sina.com, April 8, 2014

http://finance.sina.com.cn/stock/hkstock/marketalerts/20140408/145518734884.shtml

Tencent, April 8, 2014

http://finance.qq.com/a/20140408/014472.htm

Briefings | | April 10, 2014 | Economy/Resources

Two Constraints to Investment in Foreign Countries: Money and Insurance

On April 4, 2014, www.cnstock.com published an article on China’s overseas investments. According to the article, the amount of China’s overseas investments accounted for only 6.3 percent of global cross-border investment, while China’s principal assets accounted for only 2.3 percent of the world’s investments. Although both state-owned or private enterprises all have a strong desire to invest in foreign countries, two major constraints prevent these Chinese enterprises from increasing their investments: the difficulty in obtaining financing and in obtaining insurance to cover their overseas investments.

Source: www.cnstock.com, April 4, 2014
http://news.cnstock.com/news/sns_jd/201404/2974836.htm

Briefings | | April 9, 2014 | Economy/Resources

People’s Daily Overseas Edition: Xi Jinping Explained Why Western-Style Democracy Is Wrong for China

On April 3, 2014, People’s Daily Overseas Edition published an article acclaiming Xi Jinping’s "Socialism Is the Only Way’ speech given in Belgium on April 1, 2014. In his speech, Xi explained that the Chinese people had “experimented with constitutional monarchy, imperial restoration, parliamentarianism, a multi-party system, and presidential government, yet nothing really worked.” “Finally, China took the path of socialism.”

The article further elaborated on Xi’s statement and explained why the Chinese Communist Party must be the only state power in China. According to the article, there is no democracy that is not class bound. Multi-party competition and free elections are games for wealthy people. The article concluded, “We should cherish our existing political system. We cannot irresponsibly conduct "political reform through trial and error."

Source: People’s Daily Overseas Edition, April 3, 2014
http://opinion.haiwainet.cn/n/2014/0403/c353596-20489564.html

Briefings | | April 9, 2014 | Government/Politics

Global Times: Chinese Bank Loan Write-Downs Increased Significantly

Global Times recently reported that the five largest banks in China had a 127 percent increase in loan write-downs last year. This demonstrated a clear slow-down in growth with high pressure in the financial sector. These five banks own more than half of all of the loans in China. They wrote down a total of RMB 59 billion (around US$9.5 billion) worth of loans that would never be paid back. This level of write-downs is also the highest in ten years. In addition to the dramatic number of loan write-downs, in March, the Chinese financial market also suffered the first default in the corporate bond segment, two instances of near-default “shadow bank” investment products, as well as a run on the bank in Jiangsu Province. Data also showed that the first quarter economic slow-down turned out to be more severe than expected, which may indicate the slowest year of growth for the Chinese economy since 1990.

Source: Global Times, March 31, 2014

http://finance.huanqiu.com/view/2014-03/4942861.html

Briefings | | April 8, 2014 | Economy/Resources

Xinhua: Peruvian Government Called Temporary Halt to CHINALCO Copper Project

On March 31, Xinhua reported that the government of Peru has recently shut down a China Aluminum Corporation (CHINALCO) copper mine development project temporarily, citing environmental violations. CHINALCO controls the Toromocho Copper Mine located in central Peru. The development is to construct one of the largest copper mines in the world, with the level of its capacity at 10-million tons. The Toromocho project is also China’s largest copper project overseas. The Peruvian environmental protection agency OEFA ordered the temporary shut-down due to the fact that the copper waste being discharged into the nearby lakes violated environmental protection codes. This was discovered around mid-March. The CHINALCO spokesperson refused to confirm the news because of the “lack of details.” China Aluminum Corporation is a multinational aluminum company headquartered in Beijing. It is the world’s second largest aluminum producer (and the only producer in China).

Source: Xinhua, March 31, 2014

http://news.xinhuanet.com/fortune/2014-03/31/c_126334845.htm

Briefings | | April 8, 2014 | Geo-Strategic Trend

HSBC’s March Chinese Manufacturing PMI Reached Eight-Month Low

Well-known Chinese news site NetEase recently reported that the newly released HSBC March Chinese Manufacturing PMI (Purchasing Managers Index) number showed an eight-month low, at 48.0. The Manufacturing Output sub-index reached 47.2, which is the lowest it has been in 28 months. The sub-indexes for New Orders, Import Prices, and Export Prices fell to 46.5, 46.8 and 40.7, respectively. Qu Hongbin, the HSBC Chief Economist for the China Region, commented that the Chinese manufacturing PMI confirmed a very weak domestic demand level. He expected first quarter GDP growth to be slower than the annual goal, set at 7.5 percent. HSBC expressed the belief that the Chinese authorities will start economic policy adjustments sooner rather than later. PMI is an indicator of financial activity reflecting the purchasing managers’ acquisition of goods and services. A PMI number below 50 typically reflects a decline.

Source: Netease, April 1, 2014

http://money.163.com/14/0401/09/9OO4GBUF00253B0H.html

Briefings | | April 8, 2014 | Economy/Resources

Xinhua: Experts Say China’s New Buildings Last Only 25 to 30 Years

On April 4, a 20-year old residential building in a city in Zhejiang Province suddenly collapsed. The incident draws attention to the many buildings that were built en masse

in the 1980’s in China. Now that these buildings are reaching the age of 20 to 30 years, there have been quite a few accidents:

On August 4, 2009, a two-story building in Shijiazhuang, Hebei, that had been built in the 1980s, collapsed in a rainstorm. On September 5, a five-story residential building in Ningbo, Zhejiang suddenly collapsed. Several other incidents took place in 2012 and 2013, resulting in deaths or injuries.

In 2010, a Ministry of Housing and Urban-Rural Development expert said at a conference, "Our country is the country with the largest number of new buildings constructed each year, but the buildings last only 25 to 30 years." In contrast, the average life expectancy of U.K. construction is 132 years and in the U.S. it is 74 years.

Source: Xinhua, reprinted on People’s Daily Online, April 7, 2014
http://society.people.com.cn/n/2014/0407/c1008-24838390.html

Briefings | | April 7, 2014 | Economy/Resources

Foreign Ministry Tells U.S. to “Watch Your Step and Mind Your Words” on Hong Kong

Recently the spokesperson for the Office of the Commissioner of the Ministry of Foreign Affairs of the People’s Republic of China in the Hong Kong Special Administrative Region (SAR) answered a question from a journalist regarding U.S. Vice President Biden’s meeting with two heavyweight pan-democrats from Hong Kong and the New York Times’ Editorial "Protecting Hong Kong’s Autonomy."

"Since Hong Kong SAR’s reunification 17 years ago, the system of ‘one country two systems’ has been successfully implemented. The economic, social, and democratic developments in Hong Kong have exceeded expectations. The Hong Kong people enjoy unprecedented democratic rights and freedoms, which has won widespread international acclaim."

The spokesperson continued that Hong Kong affairs are China’s internal affairs. They firmly oppose any country intervening in any way and interfering with its internal affairs. The current political reform in Hong Kong is at a sensitive time. It is hoped that the United States will "watch your steps and mind your words" and not let the issue of Hong Kong interfere with Sino-US relations.

Source: China News, April 6, 2014
http://www.chinanews.com/ga/2014/04-06/6035011.shtml

Briefings | | April 7, 2014 | US-China Relations

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.