China strives to launch space labs

Source: By Xin Dingding (China Daily)

Two to three space laboratories may be launched by China between 2010 and 2015, roughly less than a decade before the nation embarks upon a space station in 2020, a top scientist said.

Gu Yidong, former chief commander and a designer for China's manned space program, said that space laboratories will be docked on a number of spaceships to test for accurate docking technology. He made the remarks at an annual academic meeting of the Chinese Society of Space Research in Dalian over the weekend.

The docking technology is an important feature that China must master before moving forward with the construction of a space station.

Any miscalculations during a docking could lead to the collision of spacecraft, according to the official website of China's manned space program, cmse.gov.cn.

In addition to the docking technology, China also needs to achieve technological breakthroughs in the length of stay in space for astronauts, the long-term unattended operation of a spacecraft and transferring supplies by cargo spacecraft, according to the website.

China is now in the second phase of a three-step plan that the nation drafted to carry out its manned space program.

According to the official website, the second phase includes the launch of the target spacecraft Tiangong I, and two space laboratories, Tiangong II and Tiangong III.

Two unmanned spaceships and five manned spaceships will also be launched during the phase to dock on the Tiangong crafts to test the docking technology.

As for the future space station, Gu Yidong said the core module of the space station will be launched from Hainan in the new launching center, which is currently under construction.

And the cargo spaceship will be launched from the existing launching center in Jiuquan, northwest China's Gansu province, to provide supplies to the space station each year, Gu said.

Pang Zhihao, researcher and deputy editor-in-chief of the monthly Space International, said yesterday that China now faces several difficulties in launching the space laboratories.

"Difficulties include developing a large launching vehicle, and solving the life support and temperature control problems," he said.

Providing a larger space and a longer operation time, a space station can enable the exploration of space for a longer amount of time, which spaceships cannot currently achieve, he said.

Chinese astronauts have already carried out extravehicular activity during the Shenzhou VII mission last year, signaling a good start of the manned space program's second phase.

The next move expected will be the launch of Tiangong I, or Heavenly Palace I, scheduled at the end of 2010 or at the beginning of 2011, Xinhua News Agency reported earlier.

Qi Faren, chief designer of the Shenzhou spacecraft, told China Daily in March that Shenzhou VIII, Shenzhou IX and Shenzhou X will dock with Tiangong I to test the docking technology.

If Shenzhou VIII, an unmanned spaceship, successfully docks with Tiangong I in 2011 as planned, manned spaceships will be launched to dock with Tiangong I. Then efforts will follow to improve Tiangong I and develop space laboratories, Qi said.

Full article: http://www.chinadaily.com.cn/china/2009-09/01/content_8640106.htm

Turkey vows to enhance ties with China

Source: China Daily

Turkey's government has vowed it firmly adheres to the one-China policy and will not allow anyone in Turkey to engage in sabotaging China's sovereignty and territorial integrity.

Turkey's State Minister Zafer Caglayan conveyed these remarks from Prime Minister Recep Tayyip Erdogan to Chinese Premier Wen Jiabao Monday.

Caglayan is visiting China as a special envoy of Turkey's prime minister.

Turkey understood the measures the Chinese government took to calm the riot on July 5 in Urumqi, said Caglayan.

The riot in the capital of Northwest China's Xinjiang Uygur autonomous region killed 197 people and injured more than 1,600 others.

In the message Caglayan carried to Premier Wen Monday, Erdogan said he believed Xinjiang would return to a state of stability, harmony and prosperity. He said Turkey wanted to enhance high-level exchanges and trade cooperation with China as well as cooperation on international affairs in forums such as the United Nations.

Premier Wen said both countries should understand and support each other on major issues concerning their core interests and join together to deal with severe challenges.

Mutual respect of sovereignty and territorial integrity, and noninterference in internal affairs are important criteria for international relations and the political basis for friendly cooperation between China and Turkey, Wen said.

Wen said the Chinese government had the capability to maintain stability and normal social order and would take effective measures to support economic development and social progress in Xinjiang. As developing, multiethnic countries, however, both China and Turkey are often confronted by extremism, separatism and terrorism, and China would like to join with Turkey to fight these "three forces", Wen said.

"China values its relationship with Turkey from a strategic height, cherishes the friendship between the two peoples, and is willing to make joint efforts with Turkey to fight resolutely the three forces," said Wen.

Caglayan said Turkey and China, which shared the same concerns and interests, did not want to see any harm done to bilateral ties.

China was an important trade partner of Turkey, and Turkey would enhance cooperation with China in areas such as trade, investment, infrastructure and shipping in a bid to jointly tackle the current economic downturn, said Caglayan, who arrived in Beijing on Saturday.

Full article: http://www.chinadaily.com.cn/china/2009-09/01/content_8638681.htm

Indonesian satellite launched in China in normal state

Source: Xinhua

XICHANG: Indonesian communications satellite Palapa D has been captured and is now able to conduct orbit maneuver, a few hours after an announcement that it failed to enter a preset orbit following its launch at 5:28 pm Monday at the Xichang Satellite Launch Center in southwest China.

The satellite is in a normal state, its manufacturer, the French company ThalesAlenia Space, said late Monday night.

The satellite was launched atop a Chinese-made Long March 3B rocket.

The Palapa D satellite, owned by Indonesian satellite communications company Indosat, was supposed to provide satellite links and broadcasting services for Indonesia and other southeastern Asian nations.

Indosat ordered the satellite from ThalesAlenia Space in 2007.

Full article: http://www.chinadaily.com.cn/china/2009-09/01/content_8640163.htm

Oil drops nearly 4% on China economy fears

Source: Agencies

NEW YORK: Oil prices fell nearly 4 percent to below $70 a barrel on Monday as fear of a curb in Chinese bank lending dented optimism about the pace of economic recovery and a potential rebound in global energy demand.

US crude for October delivery settled down $2.78, or 3.8 percent, at $69.96 a barrel, having fallen as low as $69.13 in intraday trade. In London, Brent crude settled down $3.14 at $69.65 a barrel.

China's key stock index dived 6.74 percent on Monday to a three-month low, prompted by concern that China's government is trying to moderate economic growth and choke off some speculation in its stock market by tightening bank lending.

European equities closed lower and US stocks fell after China's index fall.

"The oil markets have been strongly affected by what's going on in China, where the fear is that authorities will rein in on lending and in the process curtail growth," said Phil Flynn, an analyst at PFGBest Research in Chicago.

Jitters about the Chinese economy, the world's second largest oil consumer, also weighed on other Asian stock markets.

The Organization of the Petroleum Exporting Countries meets to review output on September 9 in Vienna. Several ministers and officials from the group have said it is likely to leave output targets unchanged.

Even though OPEC agreed to 4.2 million barrels per day of supply curbs late last year, and has kept output targets steady so far in 2009, actual production has been rising in recent months, according to industry surveys.

In a further sign of that trend, Abu Dhabi, the main producer in the United Arab Emirates, an OPEC member, will lift supply to Asia in October, the state oil firm said on Saturday.

Despite the indications of higher supply from some in OPEC, oil has rallied from a low of $32.40 in December, the weakest price in nearly five years, to a 2009 high of $75 a barrel last week.

Full article: http://www.chinadaily.com.cn/world/2009-09/01/content_8638550.htm

Actress Yin Youcan

Source: Sina.com.cn

View pictures:

http://www.china.org.cn/culture/2009-08/31/content_18433966.htm

iPhone What?? China Mobile Launches Ophone Handsets

Source: China Tech News

Days after news of rival China Unicom's non-exclusive iPhone deal with Apple, Chinese telecom operator China Mobile formally launched its Ophone platform and Ophone handsets today.

According to Wang Jianzhou, president of China Mobile, the Ophone platform is the first mobile Internet-oriented smart mobile terminal software platform that has been developed by a telecom operator. It is expected to significantly improve the competitiveness of China Mobile's TD-SCDMA terminals.

During the launch meeting for the Ophone, China Mobile announced three Ophone-related tools and platforms, including the Ophone platform for users; the Ophone SDK software development tool targeting software developers; and the Ophone SDN software developers' community.

Wang said the Ophone platform will bring new experiences to China Mobile's hundreds of millions of users and achieve "the joint development of all main bodies of the industry chain". At the same time, the launch of the Ophone platform will lower the threshold for manufacturers' development of TD-SCDMA smartphones, accelerate the industrialization of TD-SCDMA terminals in China, and improve the competitiveness of TD-SCDMA terminals.

China Mobile revealed that the Ophone platform has gained wide support from the industry and over 20 foreign and Chinese manufacturers, including Lenovo, Dell, Dopod, LG, Hisense, and Philips, have developed and will launch Ophone handsets.

Full article: http://www.chinatechnews.com/2009/08/31/10437-iphone-what-china-mobile-launches-ophone-handsets/

Super-large rare metal deposit discovered in Xinjiang

Source: Xinhua News Agency

China has discovered rare metal deposits of more than 100,000 tonnes of niobium, the nation's largest of its kind, in northwest Xinjiang Uygur Autonomous Region, an engineer revealed Monday.

"The size has surpassed China's total proven niobium reserve of 80,000 tonnes," said Xu Haiming, a senior engineer with the Institute of Mineral Resources at the Chinese Academy of Geological Sciences.

"The super-large deposit is worth more than 130 billion yuan (19 billion U.S. dollars) after being exploited."

It also has a proven reserve of more than 10,000 tonnes of tantalum and rare earth metals, Xu said.

The deposit is 3,860 to 4,100 meters above sea level, in Baicheng County, Aksu Prefecture of south Xinjiang.

Niobium and tantalum are rare metal elements, which are widely used in the fields of electronics, aviation, atomic energy, and mechanical manufacturing.

The exploration started in 2007 and has cost about 20 million yuan, Xu said.

Full article: http://www.china.org.cn/business/2009-08/31/content_18436628.htm

Dalai Lama Holds Services for Typhoon Victims

Source: Wall Street Journal by Ting-I Tsai

TAIPEI--The Tibetan spiritual leader Dalai Lama began the first day of his trip here Monday, holding religious services for victims of Typhoon Morakot and sharing his thoughts on Taiwan and China's relationship, saying the two should develop "very close and unique links."

The Dalai Lama spent the day in southern Taiwan, visiting the area devastated by the typhoon, which authorities on Monday said killed 602, with 81 missing. The Buddhist leader conducted prayer services and spoke with grieving family members.

Although the Dalai Lama has denied that he wants to promote Tibetan independence, China has criticized the exiled spiritual leader for fomenting separatism and it strongly discourages countries from receiving him. Beijing has strongly denounced his visit, saying it could have a "negative influence" on improving ties between the one-time foes.

The exile leader Monday again emphasized that his visit was non-political and purely humanitarian. However, he also praised Taiwan's democracy and encouraged Taiwan to preserve it.

"In any case, Taiwan should have very close and unique links with mainland China, close of economy and close of defense," the Dalai Lama said, "But at the same time, Taiwan already enjoys democracy and economic prosperity … most important, you achieved democracy that you must preserve."

As part of his efforts to sought to ratchet down the tensions resulting from the visit, the Dalai Lama on Sunday canceled the only press conference of his five-day trip and downsized the scale of a scheduled mass prayer ritual. He also expressed understanding for the decision of President Ma and other member of the ruling party from meeting him.

"I don't want to create any inconvenience for anybody," he said. "No problem."

Last week, Mr. Ma approved his visit, which was made at the request of opposition party members. They asked the Dalai Lama to come to comfort the victims of the typhoon, the worst to hit the island in decades.

The 74-year-old, who is considered by many Buddhists to be a living god, was greeted Sunday night at Taoyuan railway station, where he was boarding a train to Kaohsiung, by protesters who favor reunification with China. The spiritual leader considered the protest as a sign of free expression.

"No problem, I myself totally dedicate to the promotion of democracy," he said "I like it, I love that."

The local media has reported that Beijing has slowed down its exchanges with Taiwan because of the Dalai Lama's visit. But, Liu Te-hsun, spokesman of Taiwan's Mainland Affairs Council, said "Whether there is any negative impact remains to be seen."

Sunday night, the Chinese government-run Xinhua news agency reiterated China's opposition to the trip. But it limited the brunt of its criticism to the opposition Democratic Progressive Party."

"The Democratic Progressive Party (DPP) has ulterior motives to instigate the Dalai Lama, who has long been engaged in separatist activities, to visit Taiwan," according to a spokesman for the State Council Taiwan Affairs Office, which was carried by Xinhua.

"We resolutely oppose this and our position is firm and clear," the spokesman said. "The Dalai Lama's visit to Taiwan is bound to have a negative influence on the relations between the mainland and Taiwan. We will keep a close eye on the situation."

Full article: http://online.wsj.com/article/SB125172425717072275.html

Mengniu Reshuffles its Board

Source: (Caijing.com.cn) By staff reporter Wang Shanshan

With two new big investors on board, China Mengniu reshuffled its board of directors accordingly.

China Mengniu Dairy Co. Ltd. said it has appointed its executive director Niu Gensheng as chairman of the board, while COFCO president Yu Xubo will assume Niu's previous position as chairman of the company's major operating subsidiary, Inner Mongolia Mengniu Dairy (Group) Co. Ltd.

In a statement to the Hong Kong Stock Exchange on Aug. 27, Mengniu (HKEX: 2319) said it had also appointed four non-executive directors from its new investors, COFCO and Hopu Investment Management Co.

The appointees include COFCO chairman Ning Gaoning, COFCO president Yu Xubo and company strategy director Ma Jianping, as well as Hopu chairman Fang Fenglei.

COFCO, or China National Cereals, Oils & Foodstuffs Import & Export Corp., and Hopu, the country's largest private equity firm, jointly purchased a 20-percent stake in Mengniu for HK$6.1 billion in July.

Former Mengniu executive director Yang Wenjun will become president of both the listed company and Inner Mongolia Mengniu Dairy; Ning Gaoning and Jiao Shuge will become vice chairmen of the board.

The company now has 13 board directors, including four executive directors, six non-executive directors and three independent non-executive directors.

Zhang Zhenhua, director of the company's board office, told Caijing that Niu will take charge of corporate strategy, while Yang Wenjun will be responsible for Mengniu's daily operations.

COFCO had earlier stated that it would not intervene in the daily operations of Mengniu but would influence strategic development through the board of directors.

COCFO is China's largest food processor, manufacturer and trader.

On Aug. 28 in Hong Kong, China Mengniu Dairy closed down 1.37 percent at HK$18.74.

Full article: http://english.caijing.com.cn/2009-08-31/110234985.html

Parents fume at factories after 200 kids sickened

Source: By Hu Yongqi in Beijing and Li Yingqing in Kunming (China Daily)

Children in Kunming, capital of Southwest China's Yunnan province, have become the latest victims of a string of lead poisoning cases to hit China this month.

Medics at the Healthcare Center for Women and Children in Tongdu township, part of the city's Dongchuan district, found 200 out of 1,000 kids given routine blood tests between June and August had excessive levels of lead.

The normal lead content ranges from zero to 100 micrograms per liter of blood (mcg/l). A level of more than 100 mcg/l is excessive and more than 200 mcg/l is severe.

"About 200 children have excessive lead in their blood. Their levels are all higher than 100 mcg/l but lower than 200 mcg/l," hospital director Wu Ling told China Daily yesterday.

It is the third report of children suffering lead poisoning this month, with cases also exposed in Fengxiang, Shaanxi province, and Wugang, Hunan province, where around 2,100 youths living beside smelting plants have been affected, with 200 hospitalized.

Officials from the Ministry of Environmental Protection have handed the investigation into the Kunming case over to the local environmental protection bureau.

The results are expected this week, but a spokesman for the bureau at the weekend said the excessive levels of lead in the children's blood had been caused by factors such as car exhaust emissions, and had no direct link with industrial pollutants.

Parents in Tongdu disagreed and blamed the poisoning on a nearby industrial park.

"There are thousands of children in Dongchuan district and other areas, so I wonder why only the kids around the industrial park have been found to have excessive lead in their blood," said a local mother, who asked not to be named. "Who will take care of our children?"

Companies based on the nearby industrial park were unavailable for comment yesterday. Doctors tested the immune systems of 156 of the 200 lead-affected children and found they were in "normal condition", said Wu Ling.

The district government said it had distributed 2,000 sachets of medicine to children that tested positive for excessive lead.

Professor Gu Haibing at Renmin University of China in Beijing said the Chinese public has been widely exposed to lead through industrial waste and urged the government to take stricter measures to prevent pollution accidents.

The Implementation Plan on Controlling Heavy Metal Pollutions, which was passed in principle by the ministry last Friday, demands joint measures by relevant departments to avoid further pollution by heavy metal smelting industries, especially lead poisoning.

The plan is still to be approved by the State Council.

Full article: http://www.chinadaily.com.cn/bizchina/2009-08/31/content_8634868.htm

Strong economy buoys Mercedes-Benz

Source: By Li Fangfang (China Daily)

China's positive economic growth has helped make the country the biggest market for the S-Class sedan by Mercedes-Benz.

The German luxury sedan maker last week officially launched the ninth generation of S-Class sedans in the China market.

"In addition to the excellence of our flagship S-Class, we believe that the overall Chinese environment played a major role in China becoming the largest S-Class market in the world," said Klaus Maier, president and CEO of Mercedes-Benz China Ltd.

Maier cited the success of the government's stimulus package that dampened the effects of the global recession.

"The government's stimulus measures have a more far-reaching effect, as it did not only help limit the impact of the downturn, but it actually spurred and boosted the growth of China's overall economy," Maier said.

Bjoern Hauber, general manager of sales and marketing for Mercedes-Benz China Ltd, said strong economic growth led to the growth of China's wealthy class, which is spurring demand for luxury products.

Wealthier customers also are demanding more personalized goods with extra features, he said.

"With the launch of the ninth new generation S-Class models, we will meet the specific and diversified needs of those very customers," Hauber said.

In the first seven months of this year, Mercedes-Benz sold nearly 31,700 luxury vehicles to Chinese customers - a 49 percent jump over last year. Total sales of S-Class cars in the Chinese mainland reached 7,250 units.

"In addition to China's encouraging market environment, the success of the S-Class can be attributed to a number of factors, including the strength of the S-Class product and heritage, as well as our attention to customer needs," said Hauber.

It was in the 1990s, when more people began driving cars that some Chinese businessmen began to yearn for a "Daben" (big Benz), the Chinese nickname for Mercedes-Benz.

Younger buyers

"Chinese customers now understand the value and brand reputation of the S-Class," Maier said.

Hauber said Chinese customers are different than customers in Western countries. For instance, the average age of an S-Class customer is 55 in Europe and 40 in China, he said.

"This younger age group in China can be accredited to the country's rapid economic development in recent years. The booming Chinese economy has led more people to become wealthy at a younger age," Hauber said.

As Mercedes-Benz's flagship model, the S-Class has been the perennial market leader, holding a market share of more than 41 percent in China's top luxury segment.

"This achievement has given us strong confidence for the market performance of the new generation S-Class in this market," Maier said.

"We are continuing the same strategy that we have adhered to, which led to the success of the S-Class. This means that we will continue to offer a diversified S-Class product portfolio to meet the different and discerning needs of our customers," he said.

Big, but cleaner

The new S-Class sedans introduced last week included the environmentally friendly, low-fuel S-400 Hybrid.

The S-400 Hybrid is the first series-production vehicle to be equipped with a hybrid drive system using a lithium-ion battery.

"We are once again ahead of competitors, giving us great confidence for its market performance in China," Maier said.

The S-400 Hybrid boasts a fuel consumption of 8.0 liters per km, or just 188 grams per km.

"The environment has become such an important topic for the Chinese government. We foresee future demand by Chinese customers for eco-friendly cars in the luxury segment," Maier said.

Mercedes-Benz is targeting the optimization of its vehicles with combustion engines, with the goal of making the gasoline engine as fuel-efficient as the diesel - and the diesel as clean as the gasoline engine.

For example, the carmaker's BlueTec diesel driving system, which emits around 60 percent less nitrogen oxide and 80 fewer particulates.

At the Detroit Auto Show in the United States earlier this year, Mercedes-Benz introduced its pilot emissions-free vehicles with electric drives and fuel-cell vehicles.

Along the way to what the company calls zero-emission mobility, Mercedes-Benz has introduced a series of green technology products including BlueTec, BlueTec Hybrid, Diesotto and Fuel-Cell.

Full article: http://www.chinadaily.com.cn/bizchina/2009-08/31/content_8634793.htm

Moving forward with carbon capture plans

Source: By Wang Ying (China Daily)

The world's largest carbon capture project launched by a coal-fired power plant broke ground in July in Shanghai.

After completion, which is scheduled before the end of this year, the project will capture as many as 100,000 tons of carbon dioxide annually.

The carbon capture project has been identified as a significant element in China's effort to reduce its greenhouse gas emissions.

Carbon capture technology, according to experts, will serve two purposes. One is to absorb excess greenhouse gas, and the other is to make it useful in related sectors.

Shanghai Shidongkou Second Power Plant, a subsidiary of Huaneng Power International Inc, is the second carbon capture program developed by its parent company.

The first project is in Beijing. The second project, located on the outskirts of Shanghai, is expected to cost about 150 million yuan ($22 million).

Carbon capture technology is a response to worsening global warming that results mostly from fossil fuel emissions.

The goal is to capture carbon dioxide from large-point sources such as fossil fuel power plants or biomass energy facilities, industries with major carbon dioxide emissions, and from natural gas processing, synthetic fuel plants and fossil fuel-based hydrogen production plants.

A new urgency

Long Weiding, executive deputy director of the New Energy Research Center of Tongjie University, told China Business Weekly that the urgency of climate change demands every nation to speed up carbon capture and storage (CCS) research.

"Currently, almost all the countries are at the very beginning stage of CCS research and development. But it will be a major trend and an effective way to deal with greenhouse gas emissions," Long said.

By 2010, at least 20 coal-fired power plants will apply carbon capture techniques, and carbon capture technology is expected to go global by 2025.

An Intergovernmental Panel on Climate Change (IPCC) survey showed that 930 billion tons of carbon dioxide -- equivalent to 45 percent of the world's total emissions in 2050 -- can be captured and stored.

Carbon capture technology can reduce greenhouse gas emissions by 20 percent to 40 percent, according to the survey.

China relies heavily on coal-fired power plants for its energy.

China's three biggest power companies -- Huaneng, Datang and Guodian -- emitted more greenhouse gases than the whole of the United Kingdom last year, according to a Greenpeace report published in late July.

China's top 10 power companies, which provided almost 60 percent of China's total electricity last year, burned 20 percent of China's coal, or 590 million tons, and emitted the equivalent of 1.44 billion tons of carbon dioxide.

Gaobeidian project

Huaneng's first carbon capture project, the Huaneng Gaobeidian project in Beijing, started operations before the Beijing Olympics in 2008, and is now capturing 3,000 tons of carbon dioxide every year.

Xu Shiseng, head of Huaneng Power's Shidongkou project, said that the local market can easily absorb the carbon dioxide captured at the Beijing project. The capital city currently has a demand for 60,000 tons annually, Xu said.

The Shidongkou project in Shanghai will follow the Gaobeidian model, which plans to sell the captured carbon dioxide for industrial utilizations.

"To start such a program will raise the power plant's costs between 20 percent and 30 percent and lower power production capacity by 8 percent to 10 percent. This is the cost of reducing greenhouse gas emission," Xu said.

Gao Shiwang, a researcher with Xi'an Thermal Power Research Institute Co Ltd, said that captured carbon dioxide is mainly used in oil exploitation, food processing and machinery washing and welding.

"Among them, the captured carbon dioxide now is mostly used for food processing," Gao said.

The solid gas or dry ice can be used for cold storage of seafood, for example. Additionally, carbon dioxide is also widely used in soda drinks and beers, he added.

"But compared with oil exploitation, food processing's annual demand for less than 1 million tons across the nation is too small," said Gao.

Oil industry use of the captured carbon dioxide can easily reach several million tons annually, he said.

Gao said the major oil fields of Shengli Oil Field in Shandong province, Liaohe Oil Field of Liaoning province and Daqing Oil Field of Heilongjiang province are all ideal places to use captured carbon dioxide.

"By doing so, they can greatly enhance the oil output," Gao said.

Zhang Maolin, deputy director of the School of Economics and Management at Tongji University, said the Shidongkou program, even with an annual carbon capture target of 100,000 tons, still is at the experimental stage.

"The Shidongkou program focuses on carbon capture, but this is not enough for a CCS project, as a more challenging question is how to store and utilize the captured carbon dioxide," Zhang said.

High costs

Jiang Minhua, a senior official at Huaneng, said the higher cost of carbon capture projects has slowed development of the Shidongkou project.

Jiang said the cost of carbon capture is as much as 200 yuan per ton, and that there will be another 150 yuan in extra costs per ton if the gas is put into commercial use.

China's limited capability in carbon dioxide applications also has slowed development, he said.

Zhang of Tongji University added that there's no guarantee that captured carbon dioxide storage facilities are 100 percent safe, especially after the gas has been stored for 20 to 30 years.

"By investing in a smaller carbon capture project in Beijing at first, our researchers can garner plenty of experience in this area through discovering and solving problems that arise," Gao of Zi'an Thermal Power Research said.

Full article: http://www.chinadaily.com.cn/bizchina/2009-08/31/content_8634756.htm

Fresh Myanmar fighting erupts

Source: Shanghai Daily

FIGHTING erupted in northeast Myanmar yesterday after days of clashes in which the leader of ethnic forces said more than 30 government troops had been killed.

The fighting in Kokang in Myanmar's Shan State, following the deployment of government troops, has sent tens of thousands of people fleeing over the border to the town of Nansan in southwest China's Yunnan Province.

The leader of the Kokang Group which is fighting Myanmar's army said his forces had captured at least 50 soldiers as well as killing more than 30 on Thursday and Friday, the Chinese Global Times newspaper reported on its Website.

Peng Jiasheng, also known as Phone Kyar Shin, gave no details on casualties among his forces, whom he said he was commanding from a safe location in Myanmar.

Splinter group

Reports from Chinese media and Myanmar groups in exile said the fighting began after the Myanmar military, allied with a local splinter group, took control of facilities run by the Kogang Group, also known as Myanmar National Democratic Alliance Army, in Laogai, in the capital of Shan State.

Myanmar wants ethnic groups to take part in its elections next year, the first in two decades.

Activists and observers say the government deployed troops because it is trying to forcibly recruit rebel fighters for an army-run border patrol force.

They say the aim was to disarm the ethnic insurgents and neutralise their threat ahead of the polls. They say the clashes erupted because of their refusal to agree to the army's demands.

The Kokang region bordering Yunnan has a population of about 150,000. It is home to a large number of ethnic Chinese, many of whom are Chinese citizens who own shops or trade in Myanmar.

Myanmar citizens housed in refugee camps in Nansan spoke of days of fear, gunfire and cannon blasts.

"It's chaos over there now. It's a real war. They keep saying they're going to stop but then it starts again,?said Li Jiao, an ethnic Chinese.

Full article: http://www.shanghaidaily.com/sp/article/2009/200908/20090830/article_412203.htm

China's CIC wealth fund muscles up as markets recover

Source: Agencies

China Investment Corp is investing as much overseas each month this year as it did in all of 2008, Lou Jiwei, the chairman of the $298 billion sovereign wealth fund, said on Saturday.

CIC is counting on handsome returns this year and might one day ask the government to hand it more of the country's record hoard of foreign reserves to manage, Lou, a former vice finance minister, said.

The fund invested just $4.8 billion outside China last year as it kept its powder dry during the global financial crisis, when asset prices tumbled. It held fully 87.4 percent of its overseas investments in cash or cash equivalents.

Now that markets are recovering, CIC is constructing a broad-based portfolio, Lou told reporters on the sidelines of a forum organized by the Washington-based Brookings Institution and the Chinese Economists 50 Forum, a Beijing think-tank.

CIC posted a negative 2.1 percent return on its global investment portfolio last year as the value of stakes such as those in Wall Street bank Morgan Stanley and private equity giant Blackstone Group slumped.

But Lou said 2009 was shaping up better.

"It will not be too bad this year. Both China and America are addressing bubbles by creating more bubbles and we're just taking advantage of that. So we can't lose," he said.

CIC was set up in September 2007 with $200 billion of foreign currency reserves transferred from the central bank, which manages its own stockpile of $2.13 trillion.

"If our returns are not bad and the state's FX reserves are still rising, we may go and ask for more," Lou said.

He said the risk of a decline in the dollar risks was more of a national issue for China than for CIC because its capital is in dollars.

Asked whether CIC would be a keen buyer in the United States, Lou said CIC can buy anywhere in the world, but it cannot avoid buying US assets because the American economy and capital markets are so large.

Lou said CIC was building a broad investment portfolio that includes products designed to generate both alpha and beta; to hedge against both inflation and deflation; and to provide guaranteed returns in the event of a new crisis.

"We have to be in everything because you never know what's going to happen in this world," he said.

As well as investing overseas, CIC controls Central Huijin, a company that holds the state's shares in big commercial banks. The increase in the value of these stakes is the reason why CIC's assets had soared to $298 billion by the end of last year.

Lou said he expected returns from Central Huijin to decline in coming years because domestic banks profits will come under pressure as their net interest margin shrinks.

Moreover, banks will have to bolster their capital base by issuing subordinated bonds or equity, diluting Huijin's returns, he said.

Full article: http://www.chinadaily.com.cn/china/2009-08/30/content_8633115.htm

GM China, China's FAW launch joint venture

Source: Agencies

SHANGHAI: General Motors China and state-owned automaker FAW Group Corp. launched a 2 billion yuan ($293 million) joint venture Sunday to make light-duty trucks and vans, initially for the fast-growing Chinese market.

GM said the joint venture will use two existing factories affiliated with FAW and have a capacity of over 100,000 vehicles. That is expected to double by the end of 2010, GM China Group President Kevin Wale told reporters in a conference call.
Plans call for building a new assembly plant in Harbin, he said.

China is a key growth market for GM, which is expanding here despite its difficulties in the US market.

"Light trucks and vans have a significant role in China and other parts of the world," Wale said. "Adding trucks rounds out our vehicle portfolio in China. It's really a key focus for future growth."

The 50-50 joint venture, based in the northeastern Chinese city of Changchun, where FAW is also based, will make FAW-branded vehicles for the Chinese market, GM said in a statement. The venture might make GM-branded vehicles for export later, but the focus for now is on meeting demand in China, Wale said.

Production will be at the existing factories in southwestern China's Yunnan province, a facility owned by FAW-affiliate Hongta Yunnan Automobile Manufacturing Co. Ltd., and at Harbin Light Vehicle Co. Ltd. in the northeastern city of Harbin, GM said.

It said the two companies will conduct research and development, exports and after-sales support as well as vehicle production.

"Our new joint venture combines the expertise of two industry leaders in a partnership that benefits both," Nick Reilly, GM executive vice president, said in a statement.

"It will address demand in China and other markets for high-quality, affordable products in one of the industry's most robust segments, while complementing the portfolio of products that GM and FAW currently offer," Reilly said.

Discussions on the venture began in early 2007 and it obtained regulatory approval in July, GM said.

FAW, originally known as First Auto Works, was founded in 1953 and began production in 1956. It sold 1.53 million vehicles, including sedans, vans and trucks, in 2008.

GM's sales in China jumped 38 percent in the first half of this year, helped by strong demand for its minivans and other small vehicles. The automaker sold more than 100,000 vehicles a month in China from January to June for a total of 814,442, a record for any half year, the company said. That compares with sales of 1,094,561 GM vehicles in China for all of 2008.

Adding truck production will help expand the company's exposure in one of the few major markets that continues to grow.

"These are quite different customers and quite different products," Wale said.

He said he expected GM's commercial vehicle sales to reach 80,000 to 90,000 this year and to rise further next year.

Full article: http://www.chinadaily.com.cn/china/2009-08/30/content_8633406.htm

Dalai Lama Arrives in Taiwan on Trip That Could Test Relations

Source: Wall Street Journal by Ting-I Tsai

TAIPEI -- The Dalai Lama arrived in Taiwan Sunday, beginning a weeklong visit that could test the delicate rapprochement between this island and its giant neighbor, China.

In an early indication that the trip might go off smoothly, the Tibetan exile leader on Sunday canceled the only press conference of his five-day trip. The press conference was scheduled for Monday, and some Taiwanese politicians were worried that he would use it as a platform to criticize China.

The trip was made at the request of local Taiwanese officials who said the Dalai Lama could comfort victims of Typhoon Morakot, which killed 571 and left 106 missing earlier this month.

But some have claimed the invitation was a political ruse: the local officials are from the opposition Democratic Progressive Party, which has been trying to limit efforts by Taiwanese President Ma Ying-jeou of the Nationalist Party from building closer ties with China. China is sharply critical of the Dalai Lama, claiming he foments independence, and strongly discourages countries from inviting him to visit.

China said last Thursday it was "resolutely opposed" to the visit, adding that the Dalai Lama "is not a pure religious figure, but uses the banner of religion to engage in activities to split the nation." But, it blamed the opposition DPP, not Mr. Ma, for the invitation, in a likely effort to keep the improving relations on track.

Mr. Ma's office said he has no plan to attend any events hosted by the Dalai Lama. "President Ma is very busy with the relief efforts" and control of an outbreak of H1N1 flu, said Wang Yu-chi, spokesman of the Presidential Office, "We have decided that President Ma would only attend government hosted religious ceremonies."

According to local press reports, the ruling Kuomintang has responded to the visit by initiating a damage-control effort in by sending a special envoy to Beijing to firm up ties. The party's chairman Wu Poh-hsiung declined to verify the report, but in an interview said, "It has been an ordinary practice for the two parties to communicate over all kinds of issues."
Mr. Wu, also, urged the spiritual leader to stay away from politics. "We believe the Dalai Lama will have the wisdom to distinguish the difference of religious empathy and political maneuvering."

Full article: http://online.wsj.com/article/SB125162643086470061.html

China Copes With Influx of Myanmar Refugees

Source: Wall Street Journal By Sky Canaves

BEIJING -- At least 10,000 people have fled fighting in northern Myanmar and crossed the border into China's Yunnan province in recent weeks, Chinese officials said Friday, posing a potential challenge to relations between the neighbors and testing authorities who have little experience in handling refugees.

Residents of the Kokang region in northern Myanmar have been under siege in a continuing battle between the ruling military junta and local leaders, according to aid groups, Chinese officials, and witnesses. As Myanmar prepares for elections, military leaders are trying to assert control over the whole country, instead of relying on local militias in some areas.

Zhang Yi, an official in the foreign-affairs office of the Yunnan government, said the fighting has caused more than 10,000 people to cross the border, and the numbers are increasing. The United Nations High Commissioner on Refugees said in a statement that it had received reports of as many as 30,000 people crossing into China since Aug. 8.

China's government, one of Myanmar's most important international backers, sounded a note of caution about the situation in a statement late Friday.

"China is closely following developments in the situation, and has already gone through diplomatic channels to express our deep concern to Myanmar," Jiang Yu, a spokeswoman for the Ministry of Foreign Affairs, said in a statement on the ministry's Web site. China "hopes that Myanmar properly resolves its domestic problems and maintains the stability of the China-Myanmar border region. We also ask Myanmar to ensure the safety and legal rights of Chinese citizens inside Myanmar."

Political instability in Myanmar could threaten Chinese investments there, which are focused on the mining and energy sectors and include several large oil and gas pipelines. It's unlikely that the Chinese military would cross the border, however, given China's stated policy of noninterference in other countries' domestic problems.

Chinese authorities have set up seven camps for the refugees, many of whom are ethnic-Chinese citizens of Myanmar. "For the maintenance of friendly relations between the two countries and the overall interests of regional stability in the border area, Yunnan province is taking active measures to settle these people in designated areas and to supply daily necessities and medical care," said Ms. Zhang of the provincial government. A number of Chinese nationals involved in business and trade across the border have also returned since the fighting broke out.

The refugee influx could pose a challenge for China, which has little experience extending humanitarian assistance to people coming over its borders. China has drawn criticism from human-rights advocates for its practice of rounding up North Korean refugees in the northeast and sending them back, where they are likely to face prison terms or be sent to harsh labor camps as punishment.

Song Jing, a press officer in the Beijing office of the UNHCR, said China hasn't had an influx of refugees as large as this one in three decades, since the period surrounding the 1979 Sino-Vietnamese war when about 260,000 Vietnamese fled north across the border. Ms. Song said the UNHCR had started discussing the situation with Chinese officials on Thursday but wasn't yet directly involved in the aid efforts.

Determining the full extent of the fighting in Myanmar is difficult, as the country is largely closed to foreign media. Clashes between the military and ethnic minorities in the border regions are fairly common, but tensions have been on the rise recently ahead of national elections next year. Historically, most displaced residents of Myanmar have sought refuge in Thailand and Bangladesh, not in China, the UNHCR says.

Analysts who closely follow events in Myanmar say its military leaders are attempting to exert full control over the entire country after previously relying on the cooperation of various armed militias belonging to the country's disparate ethnic groups. Some of these arrangements have been in place for 20 years or more, effectively giving some groups free rein over the remotest parts of the country and, in some cases, enabling private armies to establish lucrative narcotics businesses. With the military preparing for the first elections since 1990, it is reasserting its primacy.

Retaking control of these areas "is something the [military junta] has postponed again and again, and the Kokang, Wa and other groups are very unhappy about what they are getting out of the process," says David Mathieson, a Thailand-based analyst at Human Rights Watch. "The Burmese, though, are saying you've had a good run, now it's time to give it up."

According to the Thailand-based Shan Herald Agency for News, last month local leaders in Kokang, part of Myanmar's Shan States, rejected a government order to integrate their guerrilla forces into a border unit under the command of the Myanmar army. The latest series of confrontations was sparked by a recent government raid on the home of Kokang leader Peng Jiashen, also known as Phon Kyar Shin, ostensibly to search for illegal drugs, the Shan Herald Agency for News reported.

The main town in the Kokang area, Laogai, has been under Myanmar military control since Aug. 24. Analysts following the unfolding drama say there is a growing risk that Kokang's allies in the United Wa State Army -- which the U.S. describes as a major narcotic-trafficking group -- could be dragged further into the conflict. The Wa claim to have 20,000 fighters, and to command large areas of northeast Myanmar.

Chinese state-run media reported that China has increased the armed police presence along the border to prevent the conflict from spilling into the country.

Full article: http://online.wsj.com/article/SB125147825218167281.html

China Merchants Bank H1 net profit drops 37.62%

Source: Xinhua News Agency

China Merchants Bank (CMB), the country's sixth largest lender, had a net profit of 8.26 billion yuan (US$120.9 million) in the first half of this year.

The profit represents a drop of 4.98 billion yuan, or 37.62 percent from the same period last year, according to the bank's half-year report on Saturday.

By the end of June, its non-performing loan ratio was 0.86 percent, down 0.25 percentage point from the beginning of the year.

Total assets topped 1.97 trillion yuan by the end of June this year, representing an increase of 400 billion yuan, or 25.51 percent from the beginning of the year.

On Aug. 17, CMB announced it would use part of the money raised in a share issue on the Shanghai and Hong Kong bourses to set up overseas branches. It is planning to launch a branch in London soon following the setting-up of a representative office in the city last month.

Full article: http://www.china.org.cn/business/2009-08/29/content_18425314.htm

Dell gets ready for rural push

Source: China Daily

US computer maker Dell Inc said on Friday that it would continue to expand its reach outside the top tier cities as it steps up its efforts to fuel growth in China.

Steve Felice, president, small and medium business, Dell, said on Friday that the company would expand its network in the mainland to lower-tier cities and rural areas for further growth.

"We don't have a very big presence in the rural communities," Felice said. "Our focus has been in the top tier cities, and we are now in the process of expanding our reach."

But he said Dell would maintain its profitability during the expansion and conduct the whole process "in a prudent manner".

The world's second largest PC maker posted 21 percent decline in revenue in the second quarter, as consumers and companies reduced their spending on technology products amid the economic slowdown.

Felice said China appears to be emerging fastest out of the financial crisis. He said increasing demand from emerging countries like China and India would help grow revenues on an annual basis from 2010 onwards.

As part of its efforts to stimulate the domestic consumer market, the Chinese government launched a program earlier this year to give subsidy to PC buyers in rural areas, where most people do not have computers.

But foreign companies like Dell and HP only took less than 1 percent each of this market that saw 110,000 new computers being sold in the past three months. Lenovo Group, the country's largest domestic vendor, accounted for nearly half of the sales.

Felice confirmed on Friday that Dell is teaming up with China Mobile to develop smart phones in the country, but declined to disclose details. It was expected that China Mobile would launch the device as early as next Monday.

Full article: http://en.ce.cn/Business/Enterprise/200908/29/t20090829_19893843.shtml

China CITIC Bank to rejig loan portfolio in H2

Source: By Wang Bo (China Daily)

China CITIC Bank Corp, the banking unit of the nation's largest investment firm, will scale back lending growth in the second half and focus on adjusting credit composition, said a senior official of the bank on Friday.

"The bank expects to transform some 80 billion yuan ($11.71 billion) to 100 billion yuan bill discount credit it extended so far this year into normal loans in the second half, which will help direct more capital to the real economy," Wang Kang, general manager of the bank's budget and accounting department, said at the release of the first half results.

As the government signaled its intentions to free up lending to revive the economy this year, the mid-sized lender's new loans rose 323.8 billion yuan, or 49 percent in the first half from the end of last year.

The Beijing-based bank, controlled by State-owned financial conglomerate China CITIC Group, saw its net profit drop 16 percent to 7.05 billion yuan in the first half mainly on narrowing interest margins.

Net interest income fell 18 percent to 15.01 billion yuan in the first six months, as net interest margin, a gauge measuring a lender's profitability, fell nearly 1 percentage points for the period following aggressive interest rate cuts by the central bank in late last year, the bank said in its first half results.

"We expect the bank's profitability will keep improving in the second half, as we assume the interest spread may have touched a trough in May and the massive lending in the first half will put the bank in a better position in terms of profit growth," Wang said.

After rapid credit expansion in the first half, the bank saw its bad loan ratio drop to 0.99 percent at the end of June, compared with 1.36 percent at the end of last year, while capital adequacy ratio dropped to 12.04 percent from 14.32 percent over the same period.

"We have no fund raising plan this year, as the bank's capital base is adequate presently, but we might seek channels to boost tier 2 capital next year," Wang said.

CITIC Bank plans to open two new branches in northeastern and western China's Changchun and Urumqi in the second half following the three branches launched in the first half, which will increase the lender's outlets across the nation to some 600.

Full article: http://www.chinadaily.com.cn/bizchina/2009-08/29/content_8631281.htm

Mercedes-Benz bets big on mainland

Source: By Li Fangfang (China Daily)

Riding on the back of brisk sales in the first seven months, German luxury carmaker Mercedes-Benz looks poised to make further inroads in the Chinese automobile market as it gears up to launch more models targeting domestic consumers.

The premium sedan maker said car sales in the first seven months of the year grew 49 percent over same period last year. The company sold 31,711 cars during the period and had the highest growth rate in China's luxury car segment, said Klaus Maier, president and CEO of Mercedes-Benz (China) Ltd.

Maier exuded confidence when said the company remains confident of maintaining the scorching pace of growth for the rest of the year too.

"Though most of the major markets have been severely impacted by the economic downturn, China continues to maintain positive growth. The rapid growth of the economy and the automobile industry has spawned more wealthy people and also broadened their vision and understanding of international luxury brands," said Maier.

"As this affluent class continues to gain prominence, they have more purchasing power for luxury products, something that bodes well for the luxury car segment," he told China Daily.

"We are also diversifying our product strategy and plan to introduce more models in the Chinese market," he said.

After introducing its minicar brand 'Smart', as well 'B-Class' and new 'E-Class' sedans in the country during the first half, the company launched the ninth generation of its flagship 'S-Class' lineup with nine models in Beijing on Friday, priced between 930,000 yuan ($136,146) and 2,598,000 yuan.

The flagship S-Class sedans command a 41 percent market share in China's top luxury segment.

"China has become the largest S-Class market in the world since the first quarter, and the flagship model continued to dominate the top luxury segment with 7,300 units delivered to Chinese customers in the past seven months. With such success, we are confident that the new generation models will extend the S-Class leadership position, and attract even more of China's top echelon customers, who appreciate true luxury at its finest," said Maier.

He said the company still believes there is still vast untapped potential in the premium car segment.

"This is because in China, the ratio between selling luxury cars and passenger cars is 1:10, which means there is only one luxury car for every 10 passenger cars. But in the other markets, such as North America and Western Europe, the ratio is 1:5. Therefore, China still has a lot of room for growth in the luxury segment," said Maier.

According to the China Association of Automobile Manufacturers, in the first seven months, China's total passenger car sales jumped 31 percent to 5.37 million units from a year earlier as the government stimulus measures started yielding results.

Full article: http://www.chinadaily.com.cn/bizchina/2009-08/29/content_8631414.htm

Sales of iPhone in China Set Under 3-Year Accord

Source: Wall Street Journal By Loretta Chao and Lorraine Luk and Aaron Back

China Unicom (Hong Kong) Ltd. announced a deal with Apple Inc. to sell iPhones in China starting later this year, bringing the popular device to the world's largest mobile market for the first time.

The release of the iPhone in China -- which has 687 million wireless subscribers, more than twice the population of the U.S. -- is expected to be a boost for both Apple and Unicom, one of three Chinese state-owned telecommunications carriers. Still, the two companies face challenges to realizing the iPhone's potential in China, including competition from similar devices, and they left several questions about pricing and other details unanswered Friday.

Under the three-year deal, iPhones will start to be sold in China in the fourth quarter. Unicom won't share revenue with Apple, as some operators do, and it will purchase the handsets from Apple on a wholesale basis and resell them to consumers, the Chinese company said. Unicom Chief Executive Chang Xiaobing said it will offer a subsidy to customers to lower the iPhone's price, but he didn't elaborate on how much the subsidy would be. An Apple spokesman confirmed the Unicom deal but declined to give further details.

The Wall Street Journal reported Thursday the iPhone's launch in China was forthcoming. As reported, the Chinese version of the iPhone will, at least initially, be stripped of its Wi-Fi wireless Internet capability to comply with government rules.

Unicom, which had 141 million wireless users at the end of July, hopes the iPhone will attract high-spending customers who will boost its earnings and give it a leg up on dominant carrier China Mobile Ltd., which has more than triple Unicom's subscriber base. The iPhone deal comes alongside Unicom's rollout of a "third-generation," or 3G, network that will enable functions like wireless video and high-speed surfing. Unicom's 3G network is the only one among three in China that is currently technologically compatible with the iPhone.

Meanwhile, several devices running Google Inc.'s Android operating system are also expected to hit the market by the end of the year, including at least one by Taiwanese phone maker HTC Corp.

Full article: http://online.wsj.com/article/SB125144884553566179.html

Campaigners urge free entry to Dr. Sun Yat-sen site

Source: By Qian Yanfeng (China Daily)

A campaign is gaining momentum that calls for a famous scenic spot in Nanjing, Jiangsu province, to be opened up to the public for free because of its historical and cultural significance.

Historians and locals are asking government departments why they must pay to access the Dr. Sun Yat-sen Mausoleum.

Sun was one of China's most famous political leaders in the 20th century and the first provisional president after the Republic of China (ROC) was founded in 1912.

Their argument has a legal base: since last year, China has mandated that admission must be free to all memorials and museums categorized as educational patriotic locations. While many other well-known historical sites in the city - including the Memorial Hall of the Victims of the Nanjing Massacre by Japanese Invaders - have already opened their doors for free, the mausoleum continues to charge visitors 80 yuan ($12) each.

The mausoleum attracts around 14,000 visitors a day, bringing in more than one million yuan in daily ticket sales.

Wang Pengshan, director of the administrative bureau of the mausoleum, said that out of the entire mausoleum complex, only Dr. Sun Yat-sen's Memorial Hall fits within the "free entry category".

He cautioned that free entry to such sites could have a negative impact on the tourism industry.

The bureau is calling for a compromise on the free entry issue, offering free access on Dr. Sun's birthday and the anniversary of his death - Nov 12 and March 12 respectively.

But the suggestion was not enough to satisfy those calling for free entry to the site.

"Memorials and museums like Dr. Sun's mausoleum should be open for free, which is good for public education," said Shen Pingping, a resident in Nanjing. "Government funds may support their operation and maintenance and if that's not enough, authorities may well find alternative ways, like developing the sales and service industry nearby."

Li Gongzhong, an associate professor from the History Department at Nanjing University, agreed.

"Dr. Sun Yat-sen and his mausoleum make up an important part of China's modern history and have always been part of the public memory," Li said. "From a historical and cultural perspective, free admission would mean more people would be able to learn about the history."

Full article: http://www.chinadaily.com.cn/bizchina/2009-08/29/content_8631781.htm

Baosteel to buy 15% of Aquila

Source: CCTV.com

China's biggest steel maker, Baosteel, has agreed to invest 240 million US dollars for a 15 percent stake in Australian coal and iron miner, Aquila Resources.

The deal has caught the public's attention, given the stalled negotiations between the two countries.

Under the strategic cooperation agreement announced Friday, Baosteel will buy up to 43.95 million Aquila shares at 6.5 Australian dollar per share, to take a maximum stake of 15 percent in the Perth-based miner.

The agreement also includes a 12-month agreement preventing Baosteel from taking an interest greater than 19.99 per cent in Aquila. However, that is subject to certain exemptions.

The parties will also jointly "fast-track" the development of Aquila's steel raw materials projects, including iron ore, metallurgical coal and manganese.

Dai Zhihao, Deputy GM Baosteel Group, said, "The deal enables Baosteel to get involved in the resources exploration at an early stage. This is a new and important expansion for our business."
This is Baosteel's first major international strategic investment. And the deal still requires regulatory approval in both China and Australia.

Baosteel says the success of the deal is the result of over two years of negotiations. The deal is also viewed by many experts as an import signal of continued bilateral cooperation at a time when when iron ore price negotiations between Chinese steel makers and

Professor Sun Lijian, Fudan Univ., said, "This cooperation actually gives the Australian mining industry a signal. That is - let's try to solve the current problem another way. Let's do it indirectly, which can lead to a win-win result. "

But analysts also say that in order to change the situation surrounding the iron ore price negotiations, China still needs to adjust its industrial structure and improve energy efficiency, and in that way to cut its reliance on resource imports.

Full article: http://english.cctv.com/program/worldwidewatch/20090829/101826.shtml

View video: http://english.cctv.com/program/worldwidewatch/20090829/101789.shtml

Myanmar Seizes Rebel-Held Town Near China Oil and Gas Projects

Source: Bloomberg

Myanmar’s army seized control of a rebel-held town on its border with China, raising concern a 20- year ceasefire accord could collapse, threatening planned oil and gas projects in the region.

Rebels attacked Myanmar police patrolling a border gate in the Kokang-controlled area of northeastern Shan state, killing at least one, the Washington-based U.S. Campaign for Burma said in a statement late yesterday. Businesses are closed and more than 10,000 Kokang refugees have fled across the border into China on concern fighting will break out, the group said.
“The junta should withdraw its additional troops sent to Kokang,” Peng Jiasheng, who heads the local rebel army, said in a statement released through U.S. Campaign for Burma. He called a new committee set up by the regime to administer the area “illegal and illegitimate.”

Myanmar has Asia’s seventh-largest natural gas reserves, an energy source China is keen to tap to help fuel economic growth. South Korea’s Daewoo International Corp. said this week it would invest 2.1 trillion won ($1.68 billion) in a Myanmar gas project to supply China National Petroleum Corp., that country’s largest oil company.

Myanmar has increased its foreign currency holdings fourfold since 2004 to $3.6 billion, mostly on oil and gas sales to China and Thailand. Talks continue on how construction costs for an 825-kilometer (513-mile) overland gas pipeline may be split, Daewoo International said.

Border Guards

Myanmar’s military rulers have been attempting to persuade armed ethnic groups to become border guards partially under their control. The Kokang and other minorities have resisted the junta’s request to lay down their weapons and form political parties.

“The Burmese are surrounding the ceasefire groups so they cannot move unless they fight their way out or surrender,” said Khuensai Jaiyen, director of the exiled Shan Herald Agency for News based in northern Thailand, referring to the country by its former name. “The groups fear that China will close the border and then they will have to fight to the death.”

China has asked the ceasefire groups not to start shooting at Myanmar’s army because it “doesn’t want a civil war right at its borders,” Jaiyen said. “That’s bad for business.” Chinese security forces have clashed with ethnic minorities in Tibet and western Xinjiang in recent years.
Drug Trade

Four allied ceasefire groups said in an Aug. 21 statement released by the Washington-based U.S. Campaign for Burma that the junta was threatening them under the guise of a campaign to eradicate illicit drugs. The groups, who have pledged to help each other in the case of war, encouraged peaceful dialogue with the government and pledged to “never secede and announce independence,” the statement said.

“In anticipation of a resurgence of war, tens of thousands of ethnic minorities have fled to the border,” Aung Din, executive director of the U.S. Campaign for Burma, said in the statement.

Myanmar’s constitution, passed by a referendum last year, calls for a unitary state and says “all the armed forces in the Union shall be under the command of the Defense Services,” the International Crisis Group said in an Aug. 20 report.

Ceasefire groups are reluctant to become border guards because that “would greatly reduce their autonomy and would represent a major concession in return for which they are being offered no political quid pro quo by the regime,” the Crisis Group said in the report. Myanmar officially recognizes 135 ethnic groups.

Border clashes would also jeopardize national elections planned for next year that Myanmar’s government hopes will enhance its international legitimacy. Earlier this month, a court sentenced opposition leader Aung San Suu Kyi to three years with hard labor for violating her detention order. The sentence was immediately commuted to 18 months of house arrest.

Full article: http://www.bloomberg.com/apps/news?pid=20601080&sid=aV9DMwJB_Lq0

China urges U.S. to reduce surveillance operations

Source: Xinhua

BEIJING, Aug. 27 (Xinhua) -- China has called on the United States to reduce, and gradually put an end to air and sea military surveillance and survey operations to avoid naval confrontations.
　　

The request was made during a special session on maritime safety between the two countries' militaries on Wednesday and Thursday, said China's Defense Ministry.
　　

"China believes the constant U.S. military air and sea surveillance and survey operations in China's exclusive economic zone had led to military confrontations between the two sides," the Ministry said.
　　

"The way to resolve China-U.S. maritime incidents is for the U.S. to change its surveillance and survey operations policies against China, decrease and eventually stop such operations."
　　

The U.S. delegation agreed to continue discussions with their Chinese counterparts on effective methods of ensuring safety of naval vessels and warplanes of the two sides.
　　

The chief negotiators attending the session were Guan Youfei, deputy director for China's Defense Ministry's Foreign Affairs Office, and Randolph Alles, director of the Strategy and Policy Bureau of the U.S. Pacific Command.
　　

The two sides shared views on issues relating to China-U.S. maritime military security in a "substantial" and "candid" manner, and discussed ways and channels to settle relevant problems.
　　

It was the second special session between the two militaries bound by the Military Maritime Consultative Agreement (MMCA), following a series of incidents in the South China Sea and the Yellow Sea earlier this year.
　　

Since the MMCA came into force in 1998, the two militaries have held seven annual meetings and 13 working group meetings to deal with maritime military matters.

Full article: http://english.chinamil.com.cn/

Half-year net profit of BOC (HK) down 5.6%

Source: www.chinaview.cn

HONG KONG, Aug. 27 (Xinhua) -- Bank of China (Hong Kong) said Thursday its half-year profit fell by 5.6 percent from a year earlier, dragged lower by falling interest income amid the deepening economic downturn.

The bank's net profit for the six months ending June 30 amounted to 6.69 billion Hong Kong dollars, down from 7.09 billion Hong Kong dollars in the same period last year.

However, the bank said it represented a major improvement against the net loss of 3.75 billion Hong Kong dollars in the second half of 2008, which can be attributed to the increase in operating income as well as the decrease in impairment charges on securities investments.

Net interest income decreased by 11 percent to 8.93 billion Hong Kong dollars as net interest margin narrowed by 27 basis points to 1.76 percent. But the net fees and commission income grew by 1.7 percent year-on-year to 2.95 billion Hong Kong dollars driven by the rebound of the local stock market in the first half of this year.

The bank's vice chairman and chief executive He Guangbei said the performance in the first half of this year reflected the progress the bank had made in regaining its growth momentum. As the turbulence and its knocks-on effects began to subside, the bank would pursue a prudent yet flexible development strategy in an environment of change and challenge.

He also said BOC (HK) would actively expand the RMB-related banking business as the sole Clearing Bank for Renminbi business in Hong Kong.

Full article: http://news.xinhuanet.com/english/2009-08/28/content_11955554.htm

Dairy milks its advantage

Source: China Daily

Beijing Sanyuan Foods, the only listed dairy producer that avoided being associated with China's milk contamination scandal, is to expand its national network and develop high-end products, the company's executive said.

The company wants a speedy increase in profitability and to shorten the gap with its larger counterparts, including Mengniu and Yili.

The melamine contamination scandal still casts a shadow over the top two dairy players, hitting their sales. In contrast, Sanyuan Foods registered an increase of 138 percent in profits during the first half of this year.

"This should be attributed to our timely shift towards improving our sales network especially beyond Beijing and injecting more into developing more profitable high-end products," Niu Liping, general manager of Beijing Sanyuan Foods Co Ltd, told China Daily.

The products in question include top quality yoghurts, liquid milk, milk powder and cheeses.

Niu said he was upbeat about the performance of the business over the rest of the year. "We showed we took the right direction so we shall continue as we were. The growth rate for the second half will be sustained or probably higher," he predicted.

The Shanghai-listed dairy firm released its interim financial report on Tuesday. This showed its profit grew to 36.73 million yuan on sales of 1.13 billion yuan, up by 73 percent. This is the first interim report released by the dairy industry. It will be followed by Bright Dairy and Yili Industrial Group later this week and Mengniu Dairy Group in September.

Despite increasing advertising and improving brand image, analysts are not pinning high hopes on profits at Mengniu and Yili, believing Chinese consumers' confidence has not recovered in the companies.

In 2008, Yili and Mengniu incurred a loss of 1.68 billion yuan and 950 million yuan respectively.

Sanyuan is the only one among them that enjoyed profits last year. "The melamine scandal gave our business a boost, and we took advantage of the opportunity to grow stronger," said Niu.

During the first half, Sanyuan expanded its sales network by 20 percent in Beijing, where it is based, and also extended reach into second-tier cities, especially in central and eastern regions in the provinces of Shandong, Shanxi, Hebei, Henan and Fujian.

"We are avoiding stiff competition with our competitors. Also, costs in first-tier cities are much higher," Niu explained.

The company also doubled distributors outside Beijing to more than 1,500, which helped to drive up profits in markets beyond the capital by 107 percent, the first time that regions outside Beijing outperformed what was the best performing market, Niu said.

"We will keep employing more quality distributors and set up more sales destinations."

While the major competitors are still seeking to recover lost ground, Sanyuan developed and launched a series of high-end sector products, which it had previously ignored, to gain more brand awareness. Although still small in scale, "the sector contributed 20 percent of profits", said Niu.

The company acquired Shijiazhuang-based Sanlu Group, which was at the center of the melamine crisis and went bankrupt afterward. Sanyuan expanded its capacity and became a national brand overnight through the deal, because Sanlu had been China's largest milk powder maker for years.

About 30 percent of Sanlu's former factories are redundant and expenditure is needed to standardize the two operations, factors which will cut into Sanyuan's profits over the next two to three years, said Huang Mao, a beverage analyst at Guosen Securities.

"Expanding capacity is a very urgent job for us now," said Niu.

In June, Sanyuan said it would set up an industrial park handling 1,200 tons of fresh milk on the outskirts of Beijing in an investment costing 680 million yuan. The first phase will come into operation in 2011.

Full article: http://www.china.org.cn/business/2009-08/27/content_18410319.htm

Debt-laden East Star Airlines goes bankrupt

Source: Xinhua

East Star Airlines, the debt-laden private airline based in central China's Wuhan city, officially went bankrupt after its restructuring application was rejected Thursday.

The Intermediate People's Court in Wuhan City said the plan submitted by the East Star Group and ChinaEquity was unfeasible and failed to meet the conditions for a legal restructuring.

ChinaEquity, an investment company founded in 1999 in Beijing, had promised to invest 200 million to 300 million yuan ($29 million to 44 million) for the restructuring plan.

However, it did not specify the source of the funding and failed to provide certificates and documents, and lacked measures to protect creditors, the court said.

The court said East Star Airlines had no operating income in 2008, while ChinaEquity recorded 470,000 yuan in main business income and a 187,477-yuan deficit last year.

The East Star Group and ChinaEquity reached an agreement on the restructuring plan earlier this month. The Intermediate People's Court in Wuhan heard the plan Tuesday.

East Star was founded in May 2005, making it China's fourth private carrier after Okay Airways, United Eagle Airlines and Spring Airlines. It operated more than 20 domestic passenger routes between key cities with a fleet of nine aircraft and held about 10 percent of the market share in Wuhan.

The airline, with a registered capital of 80 million yuan, was jointly owned by a tourist agency, a tourist investment company and a real estate firm, which all belonged to the East Star Group.

On March 13, the airline rejected a government-initiated takeover by the parent group of national flag carrier Air China.

Its operations were suspended by the industry regulator as of March 15, due to prolonged financial and management problems.

The order was issued by General Administration of Civil Aviation of China's branch in charge of the country's central and southern areas after the Wuhan municipal government submitted an application for the suspension.

Full article: http://www.chinadaily.com.cn/bizchina/2009-08/28/content_8627893.htm

Bribery pervades list of wealthiest

Source: By Wang Qian (China Daily)

Nearly 30 billionaires formerly on the list of China's richest people have been charged with bribery or are at the center of a police investigation, a new report shows.

Researchers for the Hurun Report, an annual list of China's rich and powerful, yesterday revealed that 19 of the 1,330 business tycoons listed in the past 10 years are either in jail or are waiting for sentencing on bribery charges.

Another 10 on the list are currently under investigation, according to "The Hurun Report: Rich in Trouble".

Seven other tycoons had previously been investigated by police though results of the probes are yet unknown, while seven have disappeared from public life and six are dead.

The report comes amid revelations yesterday that China's top legislature accepted the resignation of an entrepreneur from central Henan province from his post as deputy to the National People's Congress (NPC) for alleged involvement in "serious economic crimes".

Cui Mingjie, board chairman and general manager of the Henan Xiecheng (Shoe Town) Leather Company, submitted his resignation to the 10th session of the 11th NPC Standing Committee.

Cui, 41, was ranked 654th in the 2007 Hurun Report.

Rupert Hoogewerf, founder and publisher of the Hurun Report, said ethics and the history of the country's economic development are partly to blame for these problems.

"In the '80s and early '90s, private companies in the country were not allowed to have accounts in banks. Difficulties with fundraising led many private businessmen into tax evasion and bribery," he said in the report.

He said that having 1.4 percent of the listed billionaires in trouble is a "normal" ratio for a booming country.

Among those listed on the Rich in Trouble list is Huang Guangyu, China's richest man last year. Huang, an electronics tycoon worth more than 4 billion yuan ($588 million), has been charged with bribery following a 2008 investigation.

Huang, 39, was charged over share-price manipulation linked to Shandong Jintai Group, a medicine manufacturer owned by his brother, Huang Junqin, economic magazine Caijing reported earlier this year.

Meanwhile, Gu Chujun, former chairman of Guangdong Kelon Electrical Holdings Co Ltd, was arrested by police in September 2005 on suspicion of "economic crimes", referring to a range of violations including bribery, fraud and embezzlement.

Gu, 50, was sentenced to 10 years' imprisonment and fined 6.8 million yuan by the Foshan Supreme People's Court on April 9 this year. He was on the list three times between 2001 and 2004.

In 2003, former flower magnate Yang Bin, once listed as China's second richest man with an estimated fortune of $900 million, was jailed 18 years for bribery, fraud and illegal use of farmlands.

Among other notables on the list is Zhou Zhengyi, the Shanghai property tycoon once ranked China's 11th richest man.

Zhou was jailed for 16 years after being convicted of bribery and embezzlement in December 2007.

Nearly all the business people jailed or investigated were involved with bribery.

Wang Chengdong from the Beijing-based China University of Political Science and Law told China Daily yesterday that the government has so much power that business people have to buy privilege, a situation that plants the seeds of bribery.

Full article: http://www.chinadaily.com.cn/bizchina/2009-08/28/content_8627308.htm