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China ‘becomes largest exporter’
BBC NEWS | 2010/01/10 | 10:05:34 GMT
China’s exports rose 17.7% in December, state media has reported, suggesting the country has overtaken Germany as the world’s largest exporter. The rise, compared to a year earlier, breaks a 13-month decline in trade as a result of the global downturn. Xinhua said total exports for 2009 were $1.2tn (£749bn), but total foreign trade over the year was down 13.9%. Correspondents say the figures will lead to new demands from China’s competitors that it devalue the Yuan. Last year saw a continuing decrease in China’s trade as the global economic downturn led to a fall in demand for its products. But in the last few weeks of the year, there was a far greater rise than forecasters had expected, with foreign exports reaching $130.7bn, up 17.7% on the previous December.
China’s General Administration of Customs (GAC) said exports overall in the year were $1.2tn, down 16% from in 2008, while imports were 11.2% down from a year earlier at $1.01tn. The politically sensitive total trade surplus was down 34.2% to $196.1bn, a fall of almost a third. The figures suggest China will surpass Germany’s export total for the whole of 2009, although this will not be confirmed until Germany’s full-year data is published in February. Continue reading
China to seek bigger share of world exports
Reuters | BEIJING | Mon Dec 28, 2009 | 4:02pm IST
Beijing will not relax its efforts to sell Chinese products overseas in 2010 and seek a bigger share in the global market, China’s vice trade minister said on Sunday. China, which may have replaced Germany to be the world’s largest exporter in 2009, is a “big trading nation” but not yet, a “powerful trading nation,” vice commerce Minister Zhong Shan said. “China’s exports in 2010 will grow, and there’s no doubt about that,” Zhong said, declining to provide detailed forecasts. China’s exports were hit hard by the global financial turmoil, falling 18.8 percent in the first 11 months from a year earlier. But the market share for Chinese products has increased in 2009 as sales from other countries have fallen even more deeply, Zhong told a forum at the University of International Business and Economics in Beijing.
Other countries have blamed China’s unofficial policy of repegging the Yuan to the dollar since the summer of 2008 for making its products artificially competitive. China will feel pressure on its Yuan policy but will maintain “basic stability” Zhong said, in a reiteration of long-standing government policy. He said export growth is vital for China to drive economic growth and create jobs Continue reading
Trade Discord Fuels US, China Tension in Copenhagen
Bloomberg | December 15, 2009 | 16:11 EST
China is demanding that a global agreement to reduce greenhouse gases prohibit nations from imposing trade sanctions, further pitting the world’s No. 1 emitter against U.S. lawmakers. The draft accord from a meeting in Copenhagen to forge a climate treaty bars rich nations from adopting trade actions tied to global warming. China said such language will avert “trade wars.” The U.S. Chamber of Commerce sides with China. “We will always oppose any practice of establishing trade barriers under the guise of protecting the global environment,” Yu Qingtai, China’s climate change ambassador, said in an interview.
A proposed U.S. law would impose tariffs by 2020 on imports of certain goods from nations such as China seen as not doing enough to cut emissions. American politicians and labor groups say pending legislation to cut heat-trapping gases must include tariffs on such nations because they gain competitive advantage. The dispute between China and the U.S., which had record $268 billion surplus last year in China’s favor, illustrates how trade is emerging as a central issue dividing developed and developing countries at the United Nations gathering in the Danish capital. Continue reading
China recovery gathers strength
BBC NEWS | 2009/12/11 | 08:04:19 GMT
China has shown further signs of economic recovery with factory output surging and its export slump easing. Industrial output in November rose to its strongest position since June 2007, rising 19.2% from a year earlier. Consumer prices also grew year-on-year in November for the first time in 10 months. The index rise of 0.6% beat analysts’ expectations of 0.4%. November’s year-on-year fall in exports of 1.2% was the slowest of 2009, although growth had been expected. Imports rose 26.7% in November from a year earlier. This meant the country’s trade surplus – the difference between imports and exports – narrowed to $19.9bn in November compared with $24bn in October.
‘Strong figures’
“China’s trade is certainly recovering thanks to tariff cuts and efforts to keep the currency rate stable,” said Yi Xianrong at the China Academy of Social Sciences. Analysts said they expected exports to start growing in the coming months. There was further good news on domestic retail sales, which the Chinese government is actively trying to stimulate. The National Bureau of Statistics (NBS) said that sales were up 15.8% in November compared with the same time last year. The latest data on output, exports and sales generally exceeded the expectations of economists. “This is a strong set of figures,” said Lin Songli at Guosen Securties in Beijing. Continue reading
Participants overcrowd UN climate change conference
Xinhuanet | 2009-12-09 | 18:09:13
Government officials, representatives from non-governmental organizations (NGO) and journalists overcrowded a UN climate change conference which kicked off on Monday. The Danish government had expected 15,000 participants for the event, a key meeting that would pave the way for an international agreement on further reduction of green-house gas emissions after the first commitment period of the Kyoto Protocol ends in 2012. But more than double that number, 34,000 people on Sunday asked to physically attend the meeting, forcing the organizer to issue a media alert and apply limits on the number of journalists and NGO representatives allowed to enter since the maximum capacity of the Bella Center, the venue of the conference, is 15,000.
“Due to these constraints, NGO delegates will be allowed access to the building according to a quota system,” according to which only a prearranged percentage of each organization’s representatives can get inside during peak times, the conference’s secretariat and the Danish government said in a joint statement. “Also due to the space constraints, a maximum of 3,500 journalists will be allowed access to the Bella Center at this point in time,” they said. For fear that even more people will come for the official opening ceremony on Monday morning, the organizer simply barred media and NGO representatives who arrive late from picking up their badges to enter. “No exceptions will be made,” they said. Continue reading
China car sales pass 12 million
BBC NEWS | 2009/12/07 | 09:05:26 GMT
Chinese annual car sales and production both exceeded 12 million units in the first 11 months of the year, state media has said. The China Association of Automobile Manufacturers expects car sales and output to top 13 million for the full year, the Xinhua News Agency reported. China has never produced more than 10 million cars in one year before. Despite the downturn and falling sales at most global carmakers, demand for cars in China is booming. In November alone, sales reached 1.35 million units, according to the preliminary figures.
The country’s largest carmaker, Shanghai Automotive Industry, sold 2.44 million cars to the end of November, a rise of more than 50% compared with the same period a year earlier, Xinhua said. State incentives, such as tax cuts on small cars, have boosted sales in China. Like many other governments around the world, China has also introduced subsidies to trade in older vehicles. Previously, only the US and Japan had produced 10 million cars in a single year. Domestic Chinese car sales overtook those in the US for the first time in December of last year.
China Should Consider Raising Rates, World Bank’s Kuijs Says
Bloomberg | November 24, 2009 | 04:23 EST
China should consider raising interest rates to help prevent excessive liquidity in the financial system from creating asset-price bubbles, World Bank economist Louis Kuijs said. The “pros of higher interest rates seem to outweigh the cons,” the lender’s senior Beijing-based economist said in an e-mailed note today. The comments were first posted on his blog on the World Bank’s Web site on Nov. 19. Unprecedented lending by Chinese banks and a benchmark one- year lending rate at a five-year low of 5.31 percent have helped to fuel the nation’s economic rebound this year. The loose fiscal and monetary policies could lead to an asset bubble similar to Japan’s in the 1980s, according to BNP Paribas.
“Some are reluctant to tighten monetary policy because of low inflation, the traditional trigger for monetary policy action,” Kuijs said. “However, the recent global financial crisis has shown the dangers of neglecting asset-price increases in monetary and financial policy making.” In countries where capital inflows are a big problem, interest-rate increases may be counter-productive because extra money from Continue reading
India to tell US no role for China in South Asia
ANI | Sun, Nov 22 | 10:45 AM
The Prime Minister, Dr. Manmohan Singh, is likely to use his four-day visit to Washington commencing from today, to firmly and emphatically reiterate and re-emphasise to the American leadership, that New Delhi does not see a role for China in South Asia, nor will it tolerate attempted third party guardianship initiatives in the region by Beijing. Placing its strong objection to the reference made to South Asia in the joint statement issued by Presidents Barack Obama and Hu Jintao in Beijing this week, the Indian Government has ensured that both the United States and China retreat from their proposed mediating efforts on ties between India and Pakistan. According to sources, China has indicated its appreciation and respect for the Indian position for only having bilateral and direct talks with Pakistan and brooking no interference from outside. “On China, we have a bilateral relationship with countries and we are not interested in a guardianship role with any, and nor will we accept a guardianship role by any country,” said a source. Foreign Secretary Nirupama Rao has said: “The Chinese have said that they respect our position and support direct talks between India and Pakistan.” The Chinese establishment seems to have been told that India will not accept any “guardianship role” by any country. Continue reading
China Helps the Powerful in Namibia
NYT | SHARON LaFRANIERE |November 20, 2009
Like parents everywhere, mothers and fathers in Namibia, an impoverished southern African nation, worry about college costs and opportunities for their children. The Chinese government has stepped forward to help — for a select and powerful few. So far this year, the Beijing government has secretly awarded scholarships to study in China to the offspring of nine top officials, including to the daughter of Namibia’s president, Hifikepunye Pohamba. Two young relatives of Namibia’s former president and national patriarch, Sam Nujoma, also received grants. The disclosure of the scholarships, first revealed by a feisty Namibian newspaper, has unleashed a wave of fury from the nation’s civil society groups and youth organizations. In a country where five in six high school graduates do not go on to college, many find it unconscionable for well-paid government leaders to accept overseas university scholarships for their children. “Only senior people in government knew about the scholarships,” said Norman Tjombe, director of the nonprofit Legal Assistance Center. “No chance was given at all to the general public.”
The controversy has reignited a simmering debate in Namibia over deals with the Chinese government, already under scrutiny by Namibian prosecutors. Inquiries there and in other developing countries in Africa and Asia have cast a fresh light on how China sometimes uses its treasure chest of foreign loans and aid to create elite alliances and ease the approval of no-bid contracts. Even some within Namibia’s governing Swapo party are asking whether China is trying to buy influence with their nation’s political leadership to gain access to mineral Continue reading
World economies rebound but China set for best growth
BBC NEWS | 2009/11/19 | 11:55:56 GMT
The Organisation for Economic Co-operation and Development (OECD) says growth and recovery are expected in 2010 in just about all world regions. For its 30 member countries, rich nations including the US and UK, it has more than doubled its growth forecast to 1.9% for next year, from 0.7%. But the OECD warns developed nations not to expect a smooth ride. It said growth was being “held back by still substantial headwinds” and would be “modest” for some time. The very measures that are helping richer nations to recover pose risks to that recovery, the OECD says. The UK, for example, needed to come up with a concrete plan to ease concerns about the stability of the public finances, it added. The OECD said the effectiveness of the UK’s asset purchase programme – the so-called quantitative easing programme – was uncertain.
Jobless recovery?
The main danger for rich countries is unemployment, according to the OECD’s economic outlook. In the US, people are expected to continue 
to lose their jobs at a faster rate than new ones are created until sometime in the first part of next year. For the European Union, the picture is even worse. Unemployment may continue to rise in that region until 2011. A very different economic outlook is forecast for key emerging nations. China can expect to grow by 10%, India by more than 7%. The other two stand-out nations are Brazil and Russia. The OECD expects Brazil’s economy to rebound and expand by almost 5% after stagnating this year. Russia is also predicted to see that kind of economic improvement next year. But its turnaround will be even more dramatic. This year, it has experienced one of the worst economic slumps in the world – contracting by almost 9%. But those four so-called Bric countries are not part of the 30-strong OECD club. The one member nation whose economy should perform vigorously in 2010 is also an eastern one: South Korea should rebound to grow by 4.5% in both 2010 and 2011, after ending this year with almost no growth.
Bankers poised to help China’s richest invest $7.6 trillion – group
Reuters | Yahoo News | Thursday November 19 | 02:00 PM
Bankers poised to help China's richest invest $7.6 trln - group
The number of U.S.-dollar millionaires in China is expected to nearly double in five years, luring private bankers eager to help them invest an expected combined wealth over $7.6 trillion by 2013, Boston Consulting Group (BCG) said on Thursday. Global wealth declined last year for the first time since 2001, the consultancy said, but the number of Chinese individuals with household financial wealth of more than $1 million may grow to 788,000 by 2013 from 417,000 in 2008.
“We believe that China’s wealth market offers an attractive window of opportunity for banks,” Frankie Leung, a BCG partner in Hong Kong, told reporters in Beijing. “How banks should act to capture the opportunities and establish competitive positions would be a key strategic issue to explore.” Foreign banks, including HSBC Holdings Plc, Citigroup Inc and Bank of East Asia, have all started private banking businesses in China, competing for affluent clients with local rivals such as Bank of China. According to the consultancy’s definition, financial wealth includes cash, equities and bonds but excludes real estate and privately owned enterprises.
Globally, total assets of rich individuals declined by 11.7 percent to $92.4 trillion in 2008 due to the global financial crisis, the first decline since 2001, but BCG expects growth to resume over the next few years. “It will take roughly five years for the wealth pools to recover from the crisis and to reach a level that is comparable to wealth growth in 2007,” said Holger Michaelis, a partner and managing director of the firm. He added that the financial crisis has made rich people abandon complex products in favor of simple, less risky investments to protect, rather than grow their wealth.
Trade talks end Obama China trip
BBC NEWS | 2009/11/18 | 10:10:44 GMT
CHINA AND US TIES
- Veto holders on five-member UN Security Council
- China is the biggest foreign investor in US treasury bonds, owning about $770bn (£457bn)
- China is the world’s biggest greenhouse gas producer at 20.7% of global emissions, followed by the US with 15.5%
- US imports from China dwarf its exports, stoking trade tensions
US President Barack Obama has met Chinese Premier Wen Jiabao on the last day of his much-watched visit to the rising Asian house. Trade disputes were expected to be on the agenda during Mr.. Obama’s lunch with China’s third-highest leader, who is responsible for the economy. Reports quoted the Chinese premier as having urged a “steady balancing” of trade with the US during the talks. Mr.. Obama later visited China’s Great Wall, before heading to South Korea. The US president, who is on a week-long tour of East Asia, is expected to focus on North Korea’s nuclear ambitions during talks in Seoul.
Protectionism
Before Wednesday’s meeting with the Chinese prime minister, Mr.. Obama said the Washington-Beijing relationship was now about more than trade and economics. He said it also covered climate, security and other matters of international concern, the Associated Press news agency Continue reading
Highlights of Obama-Hu joint news conference in Beijing
Reuters | Tue Nov 17, 2009 | 1:01pm IST
Following are key quotes by U.S. President Barack Obama and his Chinese counterpart, President Hu Jintao, from their joint statement to the media in Beijing on Tuesday.
ECONOMY
HU JINTAO: “We reiterated that we will continue to increase dialogue and cooperation on macroeconomic and financial policies and continue to consult, on an equal footing, to properly resolve and address economic and trade frictions, in a joint effort to uphold the sound and steady growth of our business ties and trade. I stressed to President Obama that under the current circumstances our two countries need to oppose all kinds of trade protectionism even more strongly.”
BARACK OBAMA: “Going forward we agreed to advance the pledge made at the G20 summit in Pittsburg and pursue a strategy of more balanced economic growth. A strategy where America saves more spends less, reduces our long-term debt and where China makes adjustments across a broad range of policies to rebalance its economy and spur domestic demand. “I was pleased to note the Chinese commitment made in past statements to move toward a more market-oriented exchange rate over time.”
CLIMATE CHANGE
OBAMA: “We’ve agreed to a series of important new initiatives in this area. As President Hu indicated, we are creating a joint clean energy research centre and have achieved agreements on energy efficiency, renewable energy and cleaner uses of coal, electric vehicles and shale Continue reading
China and US ‘to work together’
BBC NEWS | 2009/11/17 | 08:42:04 GMT
US Trade Deficit with China for Sep '09
The presidents of China and the US have agreed to work together to tackle some of the world’s most pressing problems. On climate change, Barack Obama said both sides agreed on the need for a comprehensive global deal in Copenhagen next month, not a political statement. Mr. Obama and Hu Jintao also agreed to push for North Korea to re-enter stalled talks on its nuclear programme. But underlying tensions were referred to, with Hu Jintao calling for joint opposition to trade protectionism. The two leaders held two hours of talks in Beijing’s Great Hall of the People, on the edge of Tiananmen Square. Both leaders then held a joint media event at which they read out statements, but took no questions from listening journalists.
Mr. Obama came to China for his first visit as president emphasising that China was now a major player on the world stage – and he turned to that point again in Beijing. “The major challenges of the 21st Century from climate change to nuclear proliferation to economic recovery are challenges that touch both our nations, and challenges that neither of our nations can solve by acting alone,” he said. With world leaders, meeting in Copenhagen next month to discuss how to tackle global warming, climate change is perhaps the most pressing issue to resolve. Mr. Obama appeared to raise hopes that a deal could be struck in Copenhagen. “Our aim there is not a partial accord or a political declaration, but Continue reading
World Out of Balance –Paul Krugman
PAUL KRUGMAN | NYT | November 16, 2009
International travel by world leaders is mainly about making symbolic gestures. Nobody expects President Obama to come back from China with major new agreements, on economic policy or anything else. But let’s hope that when the cameras aren’t rolling Mr. Obama and his hosts engage in some frank talk about currency policy. For the problem of international trade imbalances is about to get substantially worse. And there’s a potentially ugly confrontation looming unless China mends its ways. Some background: Most of the world’s major currencies “float” against one another. That is, their relative values move up or down depending on market forces. That doesn’t necessarily mean that governments pursue pure hands-off policies: countries sometimes limit capital outflows when there’s a run on their currency (as Iceland did last year) or take steps to discourage hot-money inflows when they fear that speculators love their economies not wisely but too well (which is what Brazil is doing right now). But these days most nations try to keep the value of their currency in line with long-term economic fundamentals.
China is the great exception. Despite huge trade surpluses and the desire of many investors to buy into this fast-growing economy — forces that should have strengthened the renminbi, China’s currency — Chinese authorities have kept that currency persistently weak. They’ve done this mainly by trading renminbi for dollars, which they have accumulated in vast quantities. And in recent months, China has carried out what amounts to a beggar-thy-neighbor devaluation, keeping the yuan-dollar exchange rate fixed even as the dollar has fallen sharply against other major currencies. This has given Chinese exporters a growing competitive advantage over their rivals, especially producers in other Continue reading
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