"It is the unity of a troop, not its numerical strength, that ensures victory over the enemy." -- Chinese Maxim
December 31, 2009
POLL: Top China News Story of 2009?
Vote in our poll for the top China news story of the past year.
Happy New Year's everyone! See you in 2010....
# posted by Sinomania! : 12/31/2009 12:22:00 PM
China Accelerates Pakistan Transport Ties
China will complete a 3 lane highway in 2010 from Gilgit in the Gilgit-Baltistan area of Pakistan to Sost a town near the Pakistan-China border and the Karakoram Highway. And two new air routes will run from Gilgit and Skardu to Kashgar, Xinjiang. Skardu is a valley town on the headwaters of the Indus River with great agricultural potential. Chinese companies are also busy with several hydroelectric projects in the region. These projects were discussed with reporters by Pakistan's Information Minister Qamar Zaman Kaira who is also governor of Gilgit-Baltistan. A trade show sponsored by the Lahore Chamber of Commerce will open January 4 to showcase the investment possibilities of Gilgit-Baltistan.....
# posted by Sinomania! : 12/31/2009 11:18:00 AM
December 30, 2009
PetroChina in Caribbean Oil Tank Farm Deal
Saudi Aramco will end its lease of 5 million barrels of oil storage capacity at the big Statia Terminals on the Caribbean island Saint Eustatius and word is Chinese oil major PetroChina will take over the lease. Neither PetroChina nor NuStar Energy the Texas based owner of the facility is saying much publicly.
Alabama Metal Industries was acquired in 2005 by steel conglomerate Gibraltar Industries (NASDAQ: ROCK) whose shares rose today. Gilbraltar's major owners (apart from institutional holders such as mutual funds) are Brian Lipke, CEO and Chairman of the Board since Gibraltar's beginning in 1972, and Lipke family members. Lipke lavishes contributions on politicians of all stripes including Democratic Senator Chuck Schumer of New York (where Gibraltar is based). Imports of steel grating from China increased from $8.8 million (US dollars) to over $90 million between 2006-2008.....
# posted by Sinomania! : 12/29/2009 03:12:00 PM
China Seeks More Gold
A century ago China stubbornly stuck to a silver standard for its currency while the USA, British Empire, and Japan chose gold to back their currencies. The decision to stick with silver may have led to the rapid deterioration of China's preeminent position in trade, the collapse of the ancient Qing Dynasty, and the Chinese civil war. Earlier this year Beijing revealed that it quietly added to its gold reserves for years and that China had amassed over 1,000 tons giving it the world's 5th biggest gold stash. The faded great powers of Europe (Germany, France, and Italy) still have more but the USA is tops with nearly 9,000 tons in Fort Knox and Wall Street vaults.
Remarks by Ji Xiaonan, a senior mandarin at the Chinese State Council's State-Owned Assets Supervision & Administration bureau, reveal that Beijing may aim to displace the USA and own 10,000 tons of gold within less than a decade. Ji Xiaonan was quoted in the highly influential Economic Information Daily in late November. The newspaper dates back to 1981 and is often used to air visionary ideas on central government policy. Ji said that within only 3 to 5 years China could accumulate 6,000 tons of gold which would put Chinese reserves ahead of all nations but the USA.
# posted by Sinomania! : 12/29/2009 12:13:00 PM
December 28, 2009
Siberian Oil Flows to China from New Kozmino Terminal
Russian Prime Minister Vladimir Putin helped opened the new Kozmino oil terminal on the icy coastline of Russia's Far East today. The first shipment of crude from new fields in eastern Siberia will sail to a customer in Hong Kong. While the Kozmino terminal and part of the giant East Siberia Pacific Ocean (ESPO) pipeline is complete the final pipeline to the coast and deep inside China are still under construction. When completed (date unknown at this time) almost a fifth of the approximately 80 million tons per year of crude the pipelines carry will flow directly to China. Russian producers claim the crude - called ESPO blend for now - is comparable to middle east oil grades and its price is tentatively based on Dubai blend....
# posted by Sinomania! : 12/28/2009 12:23:00 PM
Big Plans for Chinese Grid
An amendment to China's renewable energy law puts the regulations under direct central government control. The amendment also strengthens the requirement of power companies to connect renewable energy producers to electricity grids.
As the first decade of the 21st Century comes to a close China now has the world's largest electricity transmission network at 375,000 kil0meters or over 233,000 miles of transmission lines. And there are big developments ahead. Throughout the nation China's utilities plan to install 150 billion smart meters to allow greater flexibility in rate pricing.
# posted by Sinomania! : 12/28/2009 11:47:00 AM
December 19, 2009
Wo Zhu De Sheng Deng Kaui Le
Christmas is growing as a popular fad holiday among many urban Chinese. Coming before the big (Chinese) New Year celebration Christmas is seen as a fun occasion to give gifts, eat out, and go out drinking or partying. Beijing's "Bird's Nest" stadium, site of the 2008 Summer Olympics opening ceremony and competitions, has been transformed into a winter wonderland for Christmas revelers.
Sheng Deng Kuai Le! Merry Christmas and happy holidays to everyone!
# posted by Sinomania! : 12/19/2009 11:26:00 PM
December 18, 2009
French-Chinese Helicopter Maiden Flight
The EC-175 helicopter was successfully tested yesterday in the skies above France. Jointly developed since 1995 by aerospace conglomerates Eurocopter and AVIC (of China), the EC-175 is a medium-lift twin-engined helicopter that can hold up to 16 passengers depending on configuration. The helicopter is the "product everyone is waiting for" in the civil aviation market according to Eurocopter spokesman. Both China and France have a production line and expect deliveries to begin in 2012. Although originally intended for the oil and gas industry, the EC-175 is being marketed for search and rescue missions and could easily have military application....
# posted by Sinomania! : 12/18/2009 10:55:00 AM
December 17, 2009
Reunification Watch: China-Taiwan Trade Talks Next Week
Preliminary talks on trade issues between Beijing and Taipei will occur during Christmas week. The meetings are expected to determine a timeframe for formal talks on the Economic Cooperation Framework Agreement or ECFA. ECFA could be a limited free trade agreement and sweep away decades of restrictions between Chinese investors on both sides of the contentious Taiwan Straits. The ever vocal opposition Democratic Progressive Party (DPP) on Taiwan is spinning a thunderous media cycle claiming ECFA would cost millions of jobs and end Taiwan's independence. But even American allies of the DPP admit a trade agreement would diffuse the dangerous tensions and military buildup in the region.
6. Having in mind the foregoing statements of both sides, the United States Government states that it does not seek to carry out a long-term policy of arms sales to Taiwan, that its arms sales to Taiwan will not exceed, either in qualitative or in quantitative terms, the level of those supplied in recent years since the establishment of diplomatic relations between the United States and China, and that it intends to reduce gradually its sales of arms to Taiwan, leading over a period of time to a final resolution. In so stating, the United States acknowledges China's consistent position regarding the thorough settlement of this issue.
7. In order to bring about, over a period of time, a final settlement of the question of United States arms sales to Taiwan, which is an issue rooted in history, the two governments will make every effort to adopt measures and create conditions conducive to the thorough settlement of this issue.
# posted by Sinomania! : 12/17/2009 04:54:00 PM
Guangzhou-Wuhan High Speed Rail Opens
A successful trial run of the new Guangzhou to Wuhan high-speed railway has cleared the way for regular service to begin December 26 betweeen the capital cities (respectively) of Guangdong and Hubei Provinces. Both cities are major industrial centers and travel time is now reduced from 10 (or more) hours by train to 3 hours. The trains will travel at an average speed of 350 kilometers or well over 200 miles per hour and make 15 stops at major points including Changsha. The high-speed rail corridor is part of the larger Beijing to Guangzhou high speed rail line under construction....
# posted by Sinomania! : 12/17/2009 12:09:00 PM
China Charges Up EV Development with US Firms
New joint ventures with US businesses highlight the growing convergence of the Chinese and US auto industries in electric vehicle (EV) development.
ZAP Hangzhou is California startup ZAP (OTC BB:ZAAP) and the Holley Group of China, the world's largest producer of electric meters. The venture will develop an EV and also charging infrastructure for electric taxis. In 2007 ZAP formed a joint development with US-China JV Advanced Battery Technologies (NASDAQ:ABAT).
Shanghai Advanced Traction Battery is a tie-up between A123 (NASDAQ: AONE) a lithium-ion battery systems maker out of the Boston area and giant Shanghai Automotive Industry Corp. The company will work on battery systems for a SAIC EV to come out in 2012.
Lastly, Geely Holding Group and Johnson Controls will form a cooperation around EVs for Geely Automotive to include auto parts and battery systems according to reports....
Shares of Chinese companies performed well all year whether listed in New York, Hong Kong, Shanghai or elsewhere. There are currently 56 Chinese shares listed on the NYSE with a combined market capitalization of over $1 trillion (US dollars).....
# posted by Sinomania! : 12/16/2009 02:48:00 PM
China, Coal, and Copenhagen
Beijing's National Development and Reform Commission (NDRC) is deregulating the sale of coal. New regulations say the central government will no longer hold an annual pricing conference. Instead individual power generators have a month to negotiate prices for 2010 coal deliveries with mining companies directly. The new rules also give priority to transporting thermal coal for power generation on Chinese railroads over coal for direct industrial use (coking coal for steel for example). Railroad companies can no longer allocate quotas prior to actual delivery contracts banning broker middleman from buying up quotas for spot coal sales. The end result may provide price stability overall but indications are Beijing will tolerate higher electricity rates as a result of these reforms.
China like the USA relies on coal for the majority of its baseline electricity generation. But China's dependence is higher - coal accounts for around 75% of electricity production - and China consumes more coal than any other nation. And coal use is growing and is expected to rise for the next few decades even as its use for power generation declines with more nuclear, hydro, and alternative energy production. The UN Copenhagen Climate Change Conference will end without addressing (let alone solving) this essential point: no real progress on air pollution can happen without reducing the reliance on coal for electric power by China and the USA.....
If the measures are implemented and successfully enforced it will have wide ranging impacts on global trade and pricing for several industrial commodities including iron ore, coal, nickel, and the export and import of steel products....
Called the "Volt Killer" by auto wags, the e6 is a fully electric car. The Chevy Volt, when (if?) it rolls out will be a hybrid.
If selected LA would be lead market for the autos and headquarters for BYD. With domestic EV startups such as Tesla Motors planning assembly in the greater LA region, southern California could propel a renaissance of the auto industry....
# posted by Sinomania! : 12/10/2009 11:12:00 AM
December 09, 2009
100 Million Overseas Chinese Tourists by 2020
Beijing made tourism a "pillar" of the Chinese economy in the 11th 5-year plan that ends next year. At the recent central government Work Conference on the economy, support for developing the tourism industry was stressed. It is expected that 40 million Chinese will travel outside the confines of the People's Republic in 2010 and head for Asia first followed by Europe and America. By 2020 100 million Chinese tourists are predicted to travel outside China.
The Work Conference embraced the concept, mostly imposed on China by Western partners, that consumption must be a driving (if not the driving) force in the Chinese economy. The conference said the goal was for consumption to replace public spending. Yet a more rapid settlement of migrants to China's growing mega cities will only increase the need for more infrastructure - roads, railroads, subways, housing, electricity, etc., which is reflected in the dominance of investment as a major force in China's economy. Stocks in property companies rose today, some analysts say on the news. But rural migrants are at the bottom of the elaborate class structure in China and usually too poor and too conservative to quickly become materialistic consumers.
The hukou system began in the early 1950s as a way to prevent Chinese cities from becoming overrun by poor rural migrants and end up like the major cities of the so-called developing world, that is overwhelmed by slums and unplanned development. The system became a major component of the centrally planned economy at the height of Mao's dictatorship and ultimately held back China's cities. Since 2001 it has been relaxed to varying degrees at the Provincial level and in national policy. Also as with so many laws in China it is often completely ignored....
# posted by Sinomania! : 12/07/2009 04:42:00 PM
Chinese IPOs Down Under Too
There are around ten (10) Chinese companies listed at the Australian Securities Exchange (ASX) and two more may soon be added: Rongtai Logistics, an e-commerce logisitics business in steel trading and Gansu Biotech will pursue backdoor listings. Both businesses will set up shop in Adelaide capital of South Australia and home to a growing Chinese expat community....
# posted by Sinomania! : 12/07/2009 04:33:00 PM
Chinese IPOs: CCM TRO NKBP
Coming this week to NYSE and NASDAQ three new Chinese initial public offerings. CCM is Concord Medical Services that leases radiology equipment to cancer centers throughout China. CCM will trade on NYSE and was originally priced between $9-$11 per share. Also at NYSE is TRO, Trony Solar Holdings, the leading Chinese maker of thin film solar modules. In a crowded market, ShenZhen based TRO hopes to raise up to $200 million. And on NASDAQ NKBP is the symbol for China Nuokang BioPharma offering shares between $10-$12. NKBP derives much of its revenue from hemocoagulent drug Baquting. (All prices quoted are US dollar.) So far this year, Chinese IPOs are among the best performers in the world (see chart).
# posted by Sinomania! : 12/07/2009 10:41:00 AM
December 04, 2009
Is China Buying Canola Again?
A mystery is deepening at the Port of Vancouver. A 60,000+ ton panamax class cargo vessel is scheduled to arrive mid December with intent to load up with a cargo of Canola or more specifically Canadian rapeseed ("Canola" is a trade brand that means literally Canada and oil). The news has excited Canada's futures markets for many believe the cargo of canola may be China bound. If so, it means Ottawa and Beijing have sorted out the suspension of canola trade imposed by Beijing on November 15 when China declared canola imports must be cleared by a phyto-sanitary certificate that the canola was free of Leptosphaeria maculans or blackleg. The restriction was sudden and Canada believes it is neither a health nor safety issue. China is Canada's number 1 market for canola, buying over 2.8 million tons last year. But no destination is yet recorded for the unnamed vessel.....
# posted by Sinomania! : 12/04/2009 05:01:00 PM
GM Turns Chinese, Cedes Control to Shanghai Auto
In Shanghai today GM announced it will cede control of its 12 year old highly successful (and lucrative) joint venture with Shanghai Automotive group to its Chinese partner SAIC Motor Corp. With a controlling interest of 51% SAIC Motor will be able to run Shanghai GM independent of Detroit. Further, a new joint venture will be formed in Hong Kong called General Motors SAIC Investment Ltd. to expand into India and carve market share in the subcontinent for the Wuling microvan and other products....
Overall, foreign direct investment (FDI) in China rose 5.7% in October. Although total FDI is down compared to 2008 the first 10 months of 2009 China received over $70 billion (US dollars) in foreign investment....
# posted by Sinomania! : 12/03/2009 10:22:00 AM
December 02, 2009
Pipelineistan: China Gets Gas While Stans Compete
The 2009 Turkmenistan Electric and Scientific Exhibition opens next week in the capital Ashgabat. Turkmen President Gurbanguly Berdimuhamedov was in Rome last week being wined and dined, taken to the racetrack, and signing deals with Italy's oil major ENI while PM Berlusconi promised to send a film crew to broadcast Turkmenistan's charms to Italian travelers.
Years in planning, the Nabucco pipeline project is the hope of the EU, Germany in particular, to move away from dependence on Russian gas imports. Russia and Turkemenistan are in stalemate over a gas pipeline that is largely complete but not in use. Russian President Medvedev has just arrived in Italy on the heels of his Turkmen counterpart and will visit Turkmenistan later this month.
# posted by Sinomania! : 12/02/2009 01:47:00 PM
December 01, 2009
China Trade Conundrum
Politicians of so-called developed nations bemoan the ever growing trade deficits with China that cause damage at the national level and do everything they can to retard Chinese imports. But on the ground many work to the opposite effect and want more China trade to reap the benefits of expanded jobs and fees associated with processing and distributing Chinese goods.
Ben Calmes writes, produces, and hosts a weekly broadcast on China, Chinese stock markets, and business matters, at the sinomania.com website. He has traveled alone extensively throughout eleven provinces, municipalities, and special administrative regions in China. His views on China have been sought by Moody's Investors Service, the World Economic Forum, the New York Times, Xinhua Finance, and the Council on Foreign Relations.
Ben worked in the White House in the administration of President George H.W. Bush and as a consultant to the Clinton/Gore Transition Team. He has held responsible positions at government sponsored enterprises at the federal, state, and city level as well as the US Department of the Treasury and private enterprises. Ben has a B.A. from the University of Virginia and a M.A. from USC.