What's news

Trade

Xi calls for more tariff-free zones

The experience gained with the China (Shanghai) Pilot Free Trade Zone should be replicated in more places "as soon as possible", President Xi Jinping says. The experience gained in Shanghai can be compared to "seeds cultivated from an experimental plot", said Xi at the sixth meeting of the Leading Group for Overall Reform. "We should plant these seeds in more land so that flowers will blossom and fruits are harvested as quickly as possible."

Deficit in service sector widens

China continued to have a bigger deficit in foreign service trade in September, the State Administration of Foreign Exchange says. The country's service trade deficit amounted to 133.4 billion yuan ($21.7 billion) in September, compared with 129.3 billion yuan in August, it said. The country spent a total of 211 billion yuan in international service trade during the month, nearly triple the 77.6 billion yuan it made. In the first nine months, the aggregate service trade deficit totaled 718.4 billion yuan, with 970.6 billion yuan in revenue and 1.69 trillion yuan in spending.

Finance

Yuan hits peak on policy speculation

The yuan advanced to a seven-month high on Oct 27 on speculation the central bank wants a stronger currency to spur domestic demand. The People's Bank of China raised its reference rate by 0.03 percent to 6.1446 per dollar, the first increase in four days. The yuan touched 6.1132 per dollar in early trading in Shanghai on Oct 27, the strongest level since March 7, China Foreign Exchange Trade System prices showed.

Micro-credit still on strong ground

Micro-credit companies issued 88.6 billion yuan ($14.4 billion) of new loans in the nine months ending Sept 30, official figures show. The number of micro-credit companies has now risen to 8,591, and they had outstanding loan books totaling 908 billion yuan at Sept 30, the People's Bank of China, the central bank, said. Micro-lenders largely target small companies and low-income groups in need of capital, an important channel for private capital to enter the financial market. China approved the creation of micro-credit companies in 2005, and their number rose from less than 500 in 2008 to more than 4,000 in 2011, and 7,839 by the end of last year.

Construction Bank profit growth slides

China Construction Bank Corp Ltd, the country's second-largest lender, reported its slowest quarterly profit growth in more than five years as bad loans climbed and the economy weakened.

Net income rose 5 percent to 59.6 billion yuan ($9.7 billion) in the three months to September from 56.8 billion yuan a year earlier, the Beijing-based lender said in an exchange filing on Oct 23. That compared with the 61 billion yuan median estimate of nine analysts surveyed by Bloomberg News. The earnings report, the first for the quarter from one of China's big-five banks, underscores pressures weighing on lenders' share prices.

Energy

Nation ranks top in green equipment

China is the largest manufacturer of wind and solar equipment in the world and the largest demand market for that equipment, according to a study released by Bloomberg New Energy Finance on Oct 28. The study, titled Climatescope 2014, said developing nations represent a large and rapidly growing share of the world's clean energy investment. The results suggest renewable technologies can be just as cost-competitive in emerging parts of the world as in richer nations.

Miner's surprise earnings growth

Yanzhou Coal Mining Co, China's third-largest listed coal miner by market value, surprised the market by delivering 1.95 billion yuan (about $317 million) in net profits in the first three quarters, despite flagging coal demand at home and abroad. The result compared with a loss of 589 million yuan in the same period last year, the Shandong company said in a report filed with the Shenzhen Stock Exchange. Revenue rose 15.6 percent year-on-year to 47.9 billion yuan in the first nine months, which the company attributed to strong coal sales. Its basic earnings per share rose to 0.4 yuan from minus 0.12 in the same period of last year, while total assets rose 9.48 percent from the end of last year to 137.6 billion yuan.

Oil glut 'to persist' due to dwindling demand

The current glut in global oil supplies is likely to persist next year because of slack demand and may even worsen as US lawmakers look set to approve exports of the country's booming crude production, the oil historian and consultant Daniel Yergin says. The vice-chairman of IHS CERA said the dramatic fall in global oil prices, down about 25 percent since June, is a result of global oil markets adjusting to surging production in the US. "There is definitely a surplus of geopolitical risks today, but there is an even larger surplus of oil," Yergin said. Concerns about China's economy have also cooled oil markets, ending a cycle that has kept Brent around $100 a barrel for much of the past four years.

Auto

Toyota and VW vie for pole position

Toyota Motor Corp said global sales climbed 2.8 percent in the first nine months of this year as the carmaker battles Volkswagen AG for global leadership. Worldwide deliveries for Toyota rose to 7.6 million vehicles to September, the company said. Volkswagen has reported sales of 7.4 million vehicles, excluding results for its two heavy-truck units. The race between the two global giants is being played out as customers and regulators contend with mounting recalls and rising scrutiny over the safety of vehicles, which have affected the two companies. James Chao, a Shanghai-based director at IHS Automotive, said: "You see the US coming back quite strongly for Toyota, and then you see the great engine of growth for Volkswagen being China, which is continuing to perform."

Companies

COFCO completes two M&A deals

State-owned food conglomerate COFCO Corp announced on Oct 28 the completion of the acquisition of controlling stakes in two global agricultural commodities traders. COFCO said the deals-a 51 percent stake in the Netherlands-based grain trader Nidera and a similar stake in the agricultural unit of Hong Kong-based commodities trader Noble Group-have gone through acquisition reviews and the transactions are complete.

Apple to double number of stores

Apple Inc plans to more than double the number of stores it operates in China in the next two years. The number of outlets will rise to 40 in the region comprising the Chinese mainland, Hong Kong, Macao and Taiwan, from 15 now, Tim Cook, the chief operating officer, said in an interview with Sina Corp. Apple opened its first China store in Sanlitun, Beijing, in 2008 and has since added 14 others in Beijing, Shanghai, Chengdu, Chongqing, Wuxi, Shenzhen and Hong Kong. The China region accounted for about $5.8 billion, or 14 percent, of Apple's sales revenue in the three months ended Sept 27. Cook said it is only a matter of time before China becomes Apple's largest market by sales.

China Daily - Agency

(China Daily Africa Weekly 10/31/2014 page1)