Quick look

'Three direct links'

Top mainland and Taiwan negotiators signed historic agreements last Tuesday in Taipei to establish full-fledged "three direct links" - transport, postal service and trade across the Straits. The agreements were inked during a visit by Chen Yunlin, president of the mainland-based Association for Relations Across the Taiwan Straits, to the island. It is the highest-level visit by a mainland envoy to Taiwan in nearly 60 years, which have mostly been marked by hostility and confrontation.

Big jet deal

The Commercial Aircraft Corporation of China (COMAC) last week signed a 5-billion-yuan contract to sell 25 ARJ21-700 regional jects to GE Commercial Aviation Services (GECAS), marking what is considered to be a major breakthrough in the overseas sales of the country's first home-produced jet. The delivery will start in 2013 and the 70-90 seat feeder jet will have its maiden flight in mid-November, said Zhang Qingwei, board chairman of COMAC. The regional jet is expected to receive certification from the United States Federal Aviation Administration in 2010.

Civil aircraft plans

China plans to develop a 130- to 200-seat commercial aircraft, the world's most popular type of jet, to break the market duopoly of Boeing and Airbus, said Wu Guanghui, chief designer of the program and deputy general manager of Commercial Aircraft Corporation of China (COMAC) on the first day of the Zhuhai Air Show last week.

The aircraft will be designed and assembled in Shanghai, but will source parts and components globally, which is a model adopted by Boeing and Airbus, he said. "We will choose international suppliers through bidding. But priority will go to foreign suppliers that design and manufacture products with companies in China," he added.

'Worst in recent times'

The government should find the right balance between curbing inflation and maintaining a stable economic growth, Premier Wen Jiabao said on November 1. "We must be aware that this year would be the worst in recent times for our economic development," he said in an article published in the Qiushi journal.

Stimulus package

A senior State Council official last week told China Daily on condition of anonymity that only a radical stimulus package can save the country from an excessive economic slowdown. "Major economic gauges indicate that we have entered into an excessive economic slowdown and need a radical stimulus package right now," said the official, who is close to the nation's highest decision-makers. The official highlighted that:

Bigger infrastructure and clean energy projects should be launched.

Projects aiming to increase employment should be stimulated.

Foreign trade should be stimulated.

To encourage foreign trade which has long been the country's economic engine, the official said, the government is expected to take bolder steps to implement tax rebates.

$1.9b to take PCCW private

Hong Kong tycoon Richard Li and China Unicom last week said they would offer $1.9 billion to take Li's Hong Kong telecommunications company PCCW Ltd private. Li's Singapore-listed company Pacific Century Regional Development Ltd and China Network Communications Group, now owned by China Unicom following the country's recent telecom restructuring, will offer HK$4.20 a share to buy out the 52 percent of the stocks owned by other investors in PCCW, according to a filling to the Hong Kong Stock Exchange. The price represents a 53 percent premium on PCCW's last close of HK$2.75 before the shares were suspended from trading on October 14.

Huge investment

The transport ministry is considering a plan to spend 5 trillion yuan on road and port infrastructure projects over the next three to five years, in a bid to stimulate domestic demand, the Shanghai-based China Business News reported last week. An anonymous source with the ministry was quoted as saying that the massive spending was being considered as "such investment can produce an immediate effect on the domestic demand". The 5 trillion yuan includes funds the government had already earmarked for highway construction projects, the newspaper said.

Bad food from overseas

A total of 2,719 consignments of imported food and cosmetics were rejected in the first seven months of this year, the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) said last week. The products included batches of Ausnutria baby milk formula that was found to contain the Enterobacter sakazakii bacteria, it said. Of the rejected goods, 191 consignments were discovered during inbound tests, the AQSIA said. The tainted baby milk, manufactured by Australia's Ausnutria Dairy Co, Ltd was discovered on June 10 by the Hunan provincial quality supervision and inspection bureau.

Online shoe market

Amid industry-wide closures, Betta Footwear Factory is seeking to buck the trend by focusing on the domestic and online markets. In doing so, the subsidiary of Hong Kong-based Goddess International Ltd is also moving away from the traditional strategy at previous shoe industry expos of targeting overseas orders, as recently seen at the 8th China Shoes/China Shoetec in Dongguan, a leading footwear event in Asia. Betta is already reportedly sniffing out every chance to persuade other shoemakers to joint its B2C or Business-to-Customer platform and recently launched a bid to sell its products online.

(China Daily 11/10/2008 page2)