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Tsingtao Brewery appoints new chairman

Tsingtao Brewery Co Ltd, China's second-largest brewer by volume, has announced a new chairman to replace Jin Zhiguo, who has resigned for health reasons.

Jin has been replaced by President Sun Mingbo, but will remain as honorary chairman and chief adviser. The company has also appointed Huang Kexing as its new president.

Trading in H shares of Tsingtao was suspended from 9 am on Wednesday amid speculation about the chairman. Jin was first elected Tsingtao's president in 2001, and had been chairman since 2008.

Tsingtao, founded in 1903 in Qingdao, Shandong province, now has 56 breweries across the country, according to its website. Its net profits rose to 1.74 billion yuan ($275 million) in the year ending December 2011, as revenues increased 16.4 percent to 23.16 billion yuan.

China may get exemption as US sanctions on Iran start

China and Singapore may still win exemptions from US financial sanctions related to Iranian oil imports that go into effect on Thursday, according to four US officials who spoke on condition of anonymity because of the private nature of the negotiations.

"China and Singapore both share our goals of preventing Iran from acquiring a nuclear weapon, and they appreciate" that the pressure that sanctions "have brought to bear has been key to our dual-track strategy," Secretary of State Hillary Clinton said on Wednesday on a visit to Riga, Latvia.

So far, exemptions have been granted to 18 oil importing nations, including Japan, India, South Korea and 10 European Union countries.

Hong Kong, mainland set up JV to develop derivatives

Hong Kong Exchanges & Clearing Ltd., Asia's biggest exchange company by value, agreed to set up a joint venture to develop index-linked and equity derivative products with its mainland counterparts.

The venture with the Shanghai and Shenzhen stock exchanges will develop cross-border indexes and products, according to a statement from Hong Kong Exchanges on Thursday.

Hong Kong Exchanges is seeking to expand by offering yuan-denominated and mainland-linked products. "Further integration of exchanges will actually enhance trading at the three exchanges," Charles Li, chief executive of Hong Kong Exchanges, said at a press conference Thursday.

The partners will each invest HK$100 million ($12.9 million) in the new company, to be established within three months of signing of the agreement on Thursday.

Rare earths limits not to protect industry

China defended on Thursday the limits it has placed on exports of rare earths after some of its chief trading partners sought, as part of a dispute that lasted for several months, to litigate through the World Trade Organization.

"China's export restrictions on rare earths are aimed at protecting environmental resources and people's health, not domestic industries," Hong Lei, Foreign Ministry spokesman, told reporters.

"In light of our rare earths resources, market supply, demand and consumption, we will continue to manage the mining, production and export of rare earths."

Three biggest investors in China Gas get majority

An investor in China Gas Holdings Ltd increased its stake in the utility company.

That gave the three largest shareholders in China Gas control of more than half of the company, which is the target of a $2 billion hostile takeover bid.

Beijing Enterprises Group bought 132.4 million shares in China Gas on Wednesday for between HK$3.68 and HK$4 apiece (between 47 and 52 US cents), raising its share in the company to 17.96 percent, according to a filing submitted to the Hong Kong Securities and Futures Commission on Thursday.

Beijing Enterprises Group, the single-biggest shareholder in China Gas, along with a group led by Fortune Oil Plc of Hong Kong and South Korea's SK Holdings Co, together hold 50.96 percent of the fuel supplier's shares.

Fiat returns to making cars in China with partner

Fiat SpA, which has had two failed partnerships in China, has returned to manufacturing cars in the world's largest vehicle market as the Italian automaker tries to gain ground amid a slump in European demand.

The carmaker began on Thursday to produce the Viaggio car at a new factory in Changsha in Central China with its joint venture partner Guangzhou Automobile Group Co.

To avoid paying the 25 percent import duties charged by the world's second-largest economy, Fiat must manufacture vehicles in China.

The Turin-based carmaker plans to reduce its investments by 500 million euros ($621 million) after consumer confidence there slumped to a 15-year low last month.

Axis expects China sales to rise 60% on security

Axis Communications AB, a Swedish specialist in Internet-based cameras, expects to see 60 percent more annual sales in China for "several years" as the result of an increasing demand for security.

Infrastructure projects, airports and railways will boost the demand that exists for networked cameras, Ray Mauritsson, CEO of Axis Communications, said on Thursday in a phone interview from Hong Kong. He didn't provide a detailed sales forecast for the China market.

More than 70 percent of the surveillance cameras used in China are still older models and new network cameras that can provide a higher resolution are becoming more popular, Mauritsson said.

Defaults rise on Chinese cotton imports

Defaults on Chinese cotton imports are rising as prices of new cotton trading in New York for December delivery fall, industry website cncotton.com said in a report on Thursday.

Import prices have dropped more than 2,000 yuan ($310) a metric ton in less than two months, prompting textile companies, pressured by weak demand and costs, to default on previously contracted cotton imports.

Aluminum smelters paying reduced power rates

Aluminum smelters in China's major producing regions are paying reduced rates for power, which may delay production cuts and weigh on prices, as local governments try to bolster economic growth in the world's largest user.

Five aluminum makers in Henan province, the largest producing region in China, have been paying 0.55 yuan (9 US cents) per kilowatt-hour, compared with the standard rate of 0.63 yuan, this month, said Zhang Chenguang, an analyst at SMM Information & Technology Co.

Aluminum has dropped 7 percent in London and 3.8 percent in Shanghai this year on a combination of a slowdown in China, the biggest user, and Europe's debt crisis.

Chinese steel prices drop for 11th week in a row

Steel prices in China, the world's biggest producer, dropped to an almost two-year low on Wednesday, heading for an 11th weekly decline as slowing economic growth curbed demand.

Prices for hot-rolled coil, a benchmark product, fell 0.2 percent to 4,136 yuan ($650) a metric ton, the lowest since July 22, 2010, according to researcher Beijing Antaike Information Development Co. Prices have dropped by 5.9 percent from this year's high in April.

China's economic growth in the current quarter will decline to 7.8 percent from a year earlier, the slowest expansion in more than three years, according to the median forecast of 15 economists in a Bloomberg survey.

Local government finances 'unstable, unsustainable'

The finances of China's county-level governments are unstable and unsustainable as the majority of their fiscal income comes from sources other than taxation, the nation's top auditor said.

About 60 percent of revenue raised last year by 54 counties investigated by the National Audit Office wasn't derived from taxes, Liu Jiayi, the head of the agency, told a meeting of the legislature on Wednesday, according to a transcript of his speech on the audit office's website. Total fiscal revenue at those counties rose 17 percent to 112 billion yuan ($17.6 billion) last year, Liu said.

Private lending center offers $7.86m in first two months

Wenzhou's private lending registration service center has offered 50 million yuan ($7.86 million) of credit to small and micro businesses since the facility was opened on April 26, Jiefang Daily reported on Thursday, citing Xu Zhiqian, the center's general manager.

In the two months, a total of 1.1 billion yuan of private capital has been registered in the center as funds available for lending, while the amount of credit requested by small and micro-enterprises reached 500 million yuan, the report said.

China Daily - Agencies

(China Daily 06/29/2012 page14)