IN BRIEF (Page 18)

Trade

Canton Fair to promote yuan use

Settlement transactions during the China Import and Export Fair, the country's largest trade event, will be conducted in yuan, the Chinese currency, for the first time.

"The move is part of an effort by the organizers to help accelerate the yuan's internationalization," said Liu Jianjun, spokesman for the fair and deputy director of the China Foreign Trade Center.

The 114th session of the twice-a-year fair, widely known as the Canton Fair, opened on Oct 15 in Guangzhou, the capital of Guangdong province.

"Transactions conducted with yuan-denominated settlements will also help promote the yuan business of Chinese exporters during the fair. It will help avoid losses caused by a stronger yuan," Liu said.

Finance

Re-insurance firm broadens global strategy

China Re, Asia's largest re-insurance company, will boost its international strategy through cross-border capital cooperation and merger and acquisitions, the company's chairman Li Peiyu said. According to Li, China Re will continue to focus on the Asia market while gradually exploring the European and US market as well as emerging markets. The company set up its New York office in June, aiming to explore the North American market. "We will improve the proportion of international business, aiming to be a middle-sized international re-insurer within five years," Li said at the recent conference of the Federation of Afro-Asian Insurers and Re-insurers.

Economy

Wage rises likely to moderate in 2014

Annual wage increases in German companies operating in China are likely to decrease in 2014 due to the slower economic growth, as rising labor costs remain the major human resources issue, a report from the German Chamber of Commerce in China has said.

Overall wages are expected to increase 8.2 percent in 2014, compared with the 8.9-percent growth in 2013 and the 10.2-percent growth in 2012, according to the Wage and Salary Survey of 2013, which was released on Oct 14.

The survey was conducted between Aug 19 and Sept 17, with the participation of 287 companies, mainly in industries such as machinery, vehicles, electronics, and consulting.

"As GDP growth cools, wage growth is expected to stabilize at lower levels," said Max Zenglein, an economic analyst for greater China at the chamber. "Nearly all job positions will see decreasing wage growth, with limited regional variation. And individual and company performance are most important for determining new wage levels."

Commerce

Ikea full-year sales gain helped by China growth

Ikea Group has said full-year sales rose 3.1 percent as the flat-pack furniture retailer from Sweden gained share in most markets and benefited from growth in Russia and China. Revenue increased to 27.9 billion euros ($37.9 billion), the company said. Same-store sales gained 1.8 percent at the retailer, which owns the majority of the world's Ikea outlets. Ikea said some of the strongest growth was in Russia and China and that North America showed significant progress. Southern Europe continued to be affected by that region's weak economy. The group, which will release its full-year report in January, said it gained share in "almost all markets".

Chemicals

PPG to open more plants in China

PPG Industries Inc - a major coatings and specialty products company - said it will open more plants in China in the next three to five years to make products tailored specifically to local customers.

With over 30 plants in the Asia-Pacific region, 14 of which are located on the Chinese mainland, PPG plans to develop its presence in the Chinese market step by step to become a leading domestic manufacturer.

"We're planning to find and work with more high-standard factories to manufacture what we sell in China instead of importing products from overseas to meet the increasing demands within the country," said Mike Horton, PPG's president for the Asia-Pacific region.

Horton added that all the factories the company will set up or work with should meet the company's environmental protection requirements.

IPO

Alibaba calls off HK listing plans

Alibaba Group Holding Ltd, the largest e-commerce company on the Chinese mainland, said it has abandoned its plans to launch an initial public offering in Hong Kong.

"We've decided not to list in Hong Kong," Jonathan Lu, Alibaba's chief executive officer, said at the company's headquarters in Hangzhou, Zhejiang province.

Lu added that Hong Kong authorities still need time to study and digest the innovative corporate governance structures of knowledge-based companies, such as Alibaba.

Lu's statement is the company's first public reaction on its decision of dropping its IPO plans in Hong Kong.

But despite the announcement that it is ruling out the Hong Kong stock exchange, Alibaba hasn't put an end to the rumours now swirling about its choice of listing venue. Apart from the US, the latest rumours indicate that the company might be considering launching the IPO in Shanghai.

Logistics

Express delivery to see major upswings

The market value of China's express delivery industry will reach 400 billion yuan ($65.3 billion) by 2020, according to Ma Junsheng, head of the State Post Bureau. The revenue will represent an eight-fold increase on 2010, Ma said, adding that express deliveries is the fastest growing segment in postal services. In the next decade, overall revenue for postal services will account for 0.6 percent of the country's gross domestic product, four times that of 2010. The bureau will strive to further improve efficiency and quality of services, said Ma, adding that the State-backed China Post is likely to rank among the top 100 in the Fortune 500 list soon.

Auto

Robust pickup in September vehicle sales

Vehicle sales in China showed an unexpected robust growth in September as Japanese producers continued to recover from the anti-Japanese sentiments of last year, which was tied to a territorial dispute between the two countries.

Vehicle sales were up 19.66 percent to 1.94 million, far above the increase of 10.3 percent in August, the China Association of Automobile Manufacturers reported on Oct 11.

The boom last month brought January-September sales growth to 12.7 percent, surpassing CAAM's full-year forecast of 7 percent issued earlier this year.

"The stable uptrend in recent months made us optimistic enough to say that China's total vehicle sales are likely to surge by 12 percent to 21.5 million units this year," said Rao Da, secretary-general of the China Passenger Car Association.

CAAM attributed the surge to strong momentum in the passenger car segment. Another factor was an increase in deliveries in the commercial vehicle segment.

Cadillac, Wuling spark GM sales in China

General Motors Co, the largest foreign automaker in China, reported sales growth accelerated in the country last month, fuelled by demand for its Wuling and Cadillac vehicles. Total sales in September climbed 14 percent to 277,647 vehicles, after expanding 11 percent the pervious month, the Detroit-based company said in a statement on Oct 10. Deliveries of Wuling vehicles, which account for about half of GM's China sales, gained 18 percent to 129,648 in September.

China Daily Agencies

(China Daily Africa Weekly 10/18/2013 page18)