What's news

Trade

US ruling ignites fresh solar row

The US decision to impose fresh tariffs on solar imports from China will further escalate the trade friction between the two countries and prompt Chinese solar firms to exit the US market altogether, industry sources said on June 4.

Top government officials said they were extremely "dissatisfied" with the US decision to apply preliminary duties of between 18.56 percent and 35.21 percent on Chinese solar products imports.

The US Commerce Department on June 3 said it was imposing the preliminary duties on Chinese solar panel products as it felt that Chinese manufacturers had benefited from unfair subsidies. It said its actions followed a new round of anti-subsidy and anti-dumping investigation into Chinese solar products started earlier this year.

Company

Philips, Alibaba signdeal for services

Philips (China) Investment Co Ltd and Alibaba Group Holding Ltd have signed an agreement under which Alibaba will provide Philips with a cloud computing service and provide smart products to customers in China. The two companies also intend to collaborate on big-data exchanges and analysis.

Dutch fund buys 20%of Chinese warehouser

The Dutch pension fund APG Asset Management will pay up to $650 million for 20 percent of the Chinese warehouse firm Shanghai e-Shang Warehousing Services Co Ltd and set up a joint venture to expand in China, the companies said on May 29. E-shang, backed by the private equity firm Warburg Pincus, and APG aim to tap strong demand for warehouses as Chinese e-commerce booms. The joint venture plans to develop and run modern logistics real estate assets across China.

CRE-Tesco mergergiven green light

China Resources Enterprise Ltd, China's largest retailer by market share, announced on May 29 that a joint venture agreement it signed with Britain's biggest supermarket chain, Tesco Plc, last year has been approved by the Chinese government.

Under the agreement, CRE will hold an 80 percent stake in the business, and Tesco the rest. Tesco will add the 135 outlets and 19 shopping malls it now operates across the Chinese mainland into the new venture.

The new company is intended to be developed as a multiple-format retailer operating across the Chinese mainland, Hong Kong and Macao. It will cover a variety of retail businesses, including hypermarkets, supermarkets, convenience stores and liquor stores.

Retail

Country becomes topmobile phone market

China will become the world's largest mobile phone market by revenue for the first time by the end of this year, overtaking the US, an industry report says.

Phone sales will reach $87 billion in China, 53 percent higher than last year. That compares with $60 billion projected sales in the US, Strategy Analytics said.

Smartphones dominate sales. Chinese shoppers will buy more than 400 million smartphones this year, the research company Analysys International says. The amount is on track to break 500 million by 2016, it said.

Economy

China acceleratesas euro zone falters

Signs of an economic revival in China have raised hopes that Beijing's targeted measures to bolster growth are having an impact, but a slowdown in the euro zone will increase expectations of policy easing there.

Chinese factory activity expanded at the fastest pace in five months in May but euro zone manufacturing growth slowed more than initially thought, fuelling expectations that the European Central Bank will ease policy.

"The Chinese numbers were higher," said Peter Dixon of Commerzbank. "We are beginning to make some progress, but it is consistent with this story that the Chinese economy is not going to grow as fast as it has in the past.

"The European numbers were in and around the ballpark. It's not the kind of data the ECB is going to react to instantly, but it is part of a bigger puzzle that says we need more growth in Europe."

Inflation tippedto have sped up

Growth in China's Consumer Price Index is expected to have risen in May, lifted by rising food prices, economists have said. Lian Ping, chief economist of the Bank of Communications, forecast consumer inflation will grow 2.6 percent year-on-year, a six-month high. Zhu Baoliang, a researcher at the State Information Center, estimated inflation will rise 2.4 percent after it eased to 1.8 percent in April.

Aviation

Air China to expandroutes to Washington

Air China Ltd will offer nonstop flights between Beijing and Washington four times a week starting on June 10 in the latest expansion of its network in the US. China is expected to be the top source for tourists to the US in 2018, the number of visiting Chinese reaching 4.7 million, the US' official tourism and marketing organization Brand USA says.

Finance

European stocks at six-year high

European stocks climbed to a six-year high as a report showed that Chinese manufacturing expanded at the fastest pace since December. US index futures were little changed, while Asian shares rose. "With European companies' big exposure to the Chinese market, investors are carefully watching the data out of China," said Kai Fachinger, a portfolio manager at RobecoSAM AG in Zurich. "Today's PMI report implies a stabilization of the recent numbers that had showed some deceleration."

Forex purchases decreased in April

The People's Bank of China, or the central bank, purchased foreign currencies with a net value of 84.589 billion yuan ($13.5 billion) in April, the lowest level since last July when the regulator bought 1.914 billion yuan of forex, according to Xinhua's calculations based on PBOC's data on Tuesday. PBOC's data showed that the position for PBOC's foreign-exchange purchase stood at 27.3 trillion yuan at the end of April, up from 27.2 trillion yuan at the end of March. According to PBOC's data released in May, the net foreign-exchange purchase by China's entire financial system, including the PBOC, hit an eight-month low of 116.9 billion yuan in April.

Volkswagen planning securities issue

Volkswagen AG plans to issue about 800 million yuan ($128 million) of asset-backed securities in China as soon as this month, following similar sales by Ford Motor Co and Toyota Motor Corp, a person familiar with the matter said. The securitized notes, due August 2020, are backed by automotive loan receivables originated by Volkswagen Financial (China) Co, a unit of Volkswagen Financial Services AG, Fitch Ratings Ltd said on June 3.

China Daily-Agencies

(China Daily Africa Weekly 06/06/2014 page18)