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Invest China Focus
Newsletter (No. 05, Jan. 28- Feb. 3, 2010) Editor: Dr. Cheng, and Cartier, email: greenway@greenway2china.com Publisher: Greenway International, www.greenway2china.com
1, China Energy Commission is created In the central government of China, there is an institute, named National Energy Bureau, which is under the umbrella of the National Development and Reform Commission. The growth rate of economy in China has been over 9% for last three decades, but the high economic growth rate is based on highly consuming resources and energy. China wants to shift the economic development way, but China’s role in the world has determined that China has to following the resource intensive economic development way. So, China has to secure its energy supply in the future for sustainable economic growth as an international manufacture centre of the world. Basing on the wisdom, China creates the institute, China Energy Commission, which is lead directly by the State Council and over all the ministry of the central government. Mr. Wen, Jiabao, the Premier, is the president of the institute, and Mr. Li, Keqiang, the Vice Premier, the vice president of the institute. Now that the Premier is the president of China Energy Commission, you could see that China is seeking to balance the demand for and the supply of energy in the economy of China. The supply of energy in China constitutes of oil, coal, hydro-power, and wind-power. In fact, coal is the main supply of energy in the booming economy of China. Facing the issues of globe warming and environment pollution, China has to shift to use clean energy. For instance, China has implemented a series of favoured economic policies on developing and using clean energy, such as driving a hybrid car, which is made by a Chinese auto-maker, BYD. I think creating a top energy institute China tries to shift to a new energy strategy. (From Xinhua net)
2, China will launch an ambitious plan of developing wind power China is funding six wind power bases across the country since China is endowed with abundant wind resources. The six wind power bases are located at Herbei province (close to Beijing), Inter-Mongolia, North East of China, North West of China (Gansu Province and Xinjiang), and Jiangsu province (close to Shanghai). The total expecting capacities of wind power will be 2.9 milloin KW/ year by 2020. China Wind Power Corp. (HK 00182), listed on Hong Kong Stock Exchange, has got the contracts on the projects. (from Xinhua net)
3,Petro-China is the No. one by the capitalized value Petro-China (SH 601857, HK 00857) is ranked the No. one by the capitalized value in the oil industry all over the world, and SinoPec (SH 600028, HK 0386), No. seven.
Source: Financial Times and Fenghuang net
4, Chinese bank bought shares of a bank from Canadian One of Chinese large banks, Industrial and Commercial Bank of China (ICBC, HK 01398), bought 70% stakes of the East Asia Bank from Canadian in the end of January of 2010. ICBC said, this strategic investment is the second step for the bank to develop the financial markets in the North America after opening its branch in the U.S. A. in 2008. Besides of developing the North America markets, the Bank is going to Vietnam and opening a branch at Hanoi, the capital of Vietnam. The growth rate of the profit of ICBC for last five years has been going up by 37.6%, which is more over than that of any other banks all over the world. And ICBC is expecting its net profit in 2009 will grow up by 15%. (Xinhua Net)
5, The net profit of China Life for 2009 is going up by over 50% The survey from Oliver Wyman said, China Life (SH 601628, HK 02628) has been a top financial institute for last five years according to the shareholder’s capital income. At beginning of 2010, China Life bought 24.08% of the stakes of Sino-Ocean Land (HK 03377), and became the largest shareholder of the company. (Xinhua Net)
6, China Unicom is preparing for opening iPhone 3G system China Unicom (HK 00762, SH 600050), one of the three largest communication companies in China, is preparing for opening iphone 3G system. China is the largest country for using cell phone. Most of businessman who always travels across country has at least two cell phones for controlling his business. Besides of businessman, the new generation, who was born after 1980s, is a large group cell phone user. Using cell phone is not only a part of business, but also a part of life for the new generation. Surfing internet by cell phone is a culture of cell phone user society. More than 120 million new users in 2009 surfed internet by cell phone, and the total cell phone users surfing internet had been over 233 million, accounting for 60.8% of internet surfer, by the end of 2009. Hence, if the communication company in China opens the 3G system, the amount of cell phone user apparently will go up. This means that China will open a large communication market for IT company.(from Xinhua net)
7, George Soros said, the world economy would benefit from the appreciation of RBM, Chinese Yuan China has de facto pegged it currency, RMB, to the Dollar since March of 2009. Provided that the exchange rate of Dollar against the most of currency of the world has been down about 25% for last year, the foreign exchange rate of RMB in the globe currency markets has been down too. But the balance of payments of China is still surplus, so George Soros says that China has to revalue the exchange rate of the currency, Yuan. In fact, this is not a new viewpoint on the foreign exchange rate of the Chinese currency. China has had a huge surplus on its balance of payments since the end of last century, and either the U.S. or EU has given more pressure on the government of China about the exchange rate system of RMB in the last decade. But China has said the exchange rate system of RMB is based on the situation of the economy of China, not the environment of the world economy. Last week, the finance minister of Canada said the G8 summit would talk about the exchange rate system of RMB and put more pressure on China. Dose China revalues the exchange rate of RMB? When could China appreciate the value of RMB? And how much probably will China revalue the exchange rate of Yuan? Please visit www.greenway2china.com. (from Fenghuang net)
8, The total capitalization value of stock exchange in China is No.2 The total capitalization value of the two stock exchanges, Shanghai Stock Exchange and Shenzhen Stock Exchange, in China is $3.57 trillion by the end of 2009. The New York Stock Exchange, by the capitalization value of $11.84 trillion, ranked No. one, and the Tokyo Stock Exchange by the capitalization value of $3.31trillion as No. three ranked behind that of China. (from Xinhua net)
More deeply analysis on the economy of China, such as monetary policies, foreign exchange policies and energy policies, please visit www.greenway2china.com , or contact greenway@greenway2china.com
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* Note: This newsletter is just information on the Chinese economy, and is not a recommendation for investing any financial products.
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