Official office warned on smoking
In something of a landmark, local health authorities has issued a warning to a city government department for violating Shanghai's anti-smoking regulation.
It was the first time in China that a notice was issued to regulate smoking at a provincial-level government body, said officials from the Shanghai Health Promotion Commission.
The faulty city department, which was not identified, was found to have ashtrays in its meeting room during a smoking-control check early last month, officials told Shanghai Daily yesterday.
The Shanghai Public Area Smoking-Control Regulation, the city's first regional law, bans smoking in 12 types of public areas including schools, hospitals, supermarkets and karaoke bars, and requires non-smoking areas in dance halls, restaurants and star-rated hotels.
Smoking is banned in government departments' meeting rooms, cafeterias and public working places. --(8/31)
Shanghai not at risk
Typhoon Nanmadol is unlikely to have much effect on Shanghai because of its distance from the city and relatively small size, forecasters said.
This year's 11th typhoon, which hit Taiwan yesterday, should continue to move northwest and strike Fujian Province today, said the China Meteorological Administration. --(8/30)
Shanghai-Hangzhou trains slowing down
High-speed trains running between Shanghai and Hangzhou, in neighboring Zhejiang Province, started running at slower speeds yesterday.
The trains, previously topping out at 350 kilometers per hour are being held to 300km/h, railway authorities said.
The ticket price also has gone down. The cost of a first-class ticket for trains from Shanghai Hongqiao Railway Station to Hangzhou will be cut to 124 yuan (US$19) from 131 yuan before, while that of standard tickets will be 78 yuan from 82 yuan, said the country¡¯s Ministry of Railways.
Even with the speed cut, it will take only about four minutes longer to reach Hangzhou.
But trains continuing on to Shenzhen, Guangdong Province, will also see speed reductions, increasing the time by 48 minutes to reach Fuzhou, Fujian Province, from Shanghai, and an hour longer to Xiamen in the same province.
Earlier this month, lines that run at 250km/h were cut back to 200km/h, including some services between Shanghai and Beijing.
To compensate for the cuts during the day, new bullet train services leaving at night and arriving the next morning along the Shanghai-Beijing route will start on Thursday. The cuts came because the China North Locomotive and Rolling Stock is recalling CRH380BL trains that have been involved in most of almost 40 breakdowns on the line since late June.
Officials at Shanghai Railway Station said passengers can buy bullet train tickets five days in advance. --(8/29)
Police bust smuggling ring of 7
Seven suspects have been taken into custody for allegedly smuggling cigars and tobacco worth millions of yuan and selling the products online, Shanghai police said yesterday.
Officers said they seized products such as Davidoff and Dunhill cigars worth more than 1.63 million yuan (US$255,000). The products were stored in a warehouse in suburban Qingpu District.
The gang smuggled the products via overseas mail. This year alone, the suspects sold tobacco products for more than 2 million yuan, officers said.
In July, police got a tip as they investigated a local trading company that sold imported cigars and other tobacco products online without a license.
Police said they are still investigating. --(8/28)
Migrants drive blood donation
The migrant workers who visit blood-donation buses and stations have become the main source of donations in Shanghai, the city's health authorities said yesterday.
But the city's blood donation rate of 1.17 percent is not particularly high - fewer than 12 people for every 1,000 residents donated blood.
In Shanghai, about half of all donors gave their blood at street-donation buses or stations. More than 70 percent of them were migrant workers.
"Few white-collar workers and people with high academic degrees would donate blood," said the report.
They said they're too busy to donate blood or they are in poor health, an official with the Shanghai health authorities explained.
Guo Wei, 28, a business owner, told Shanghai Daily yesterday that he has not considered donating blood because the health situation is not as good as before and because it's a tiring task and would affect daily work. He expressed concerns about the safety of the street blood-donation buses and stations.
Evan Li, an IT engineer, said he has never donated blood because he's under great pressure at work, tiring his body. "Most of my friends and colleagues share similar situation," he said.
Though Shanghai this year has not reported the blood shortage that often appears in July and August, a shortfall of about 70,000 units could occur late next year when several newly built hospitals in suburban districts will open.
In a trial operation, patients are being told before they undergo surgery that they should have their own blood pre-stored, which has helped to prevent the usual shortage.
For all of China, the blood donation rate is 0.87 percent, lower than the 1 percent standard recommended by the World Health Organization.
A country is likely to suffer shortages if its donation rate is less than 1 percent, a figure that holds in more than 70 countries and regions around the world. --(8/27)
Gold price tumbles in market correction(8/26)
Shanghai gold prices tumbled yesterday in a wide correction of the precious metal globally.
Spot gold prices at the Shanghai Gold Exchange, the sole gold exchange in China, slumped 7 percent to 10,100 yuan (US$1,620) an ounce yesterday, echoing a drop in the gold price of 5.6 percent to US$1,757.30 an ounce in New York on Wednesday, the biggest daily drop since March 2008. The price continued to fall during after-hours trading to below US$1,720 an ounce.
Zhu Suike, an analyst at China Futures, said: "Profit taking was huge - exchange-traded funds are selling gold in large amounts. The possibility that the US will stimulate the financial market reduces risk aversion."
The maximum daily price at the Shanghai bourse rose to 9 percent from 7 percent yesterday to reflect the wide fluctuation in the price.
Shanghai yesterday joined several other bourses in increasing the trade margin requirement for gold forward contracts for the second time in a month to curb volatility.
But Zhu said it is a good opportunity to buy, as a weaker US dollar and higher inflation in the US and China will support gold prices long term.
The World Gold Council said in a report last week that demand for gold rose 25 percent in China in the second quarter compared with last year despite gold prices rising 26 percent. Swiss investment bank UBS on Wednesday raised its forecast for short-term gold trading for the second time this year to a range of US$1,724 to US$2,200 an ounce. --(8/26)
Hertz and GE push electric cars
Auto rental company Hertz Global Holdings yesterday announced it will team up with GE Energy to expand its electric car leasing business into China.
The intention is to capitalize on China's electric vehicle market, though high cost and weak infrastructure remained the biggest hurdles to popularizing the technology.
Hertz will offer EV leasing to consumers and companies in Shanghai, Shenzhen and Beijing, using an initial six E6 electric cars made by China's BYD Automobile.
Under an agreement signed yesterday in Shanghai, GE Energy Industrial Solutions will help Hertz develop EV infrastructure across China - it will contribute to setting up 770 charging poles in Shanghai's Jiading District by the end of this year.
"Launching the EV leasing is not likely to boost the profitability for Hertz in China," said John Zeng, Asian automotive forecasting director at JD Power and Associates in Shanghai. "But it could help to familiarise consumers and benefit the development of the market."
China has been promoting electric vehicles as strategic initiatives to reduce dependence on oil and address environmental issues. --(8/25)
China may revise luxury good tariffs
China is considering introducing different tax policies for imported luxury products in a bid to end a lengthy dispute on whether to reduce duties on such goods.
Officials with the Ministry of Commerce have said at least five times since April that reducing duties on imported luxury goods could benefit consumers and boost domestic consumption.
"China's tax on luxury goods is the highest in the world," the Ministry of Commerce said in an article published on its website in late June. "The tax makes products several times more expensive in the domestic market than overseas. It causes (Chinese) people to spend more in foreign countries."
But the Ministry of Finance, which oversees taxation, said in early July that it would be wrong and unnecessary for China to scrap or reduce the tax, citing the need to reduce the gap between rich and poor.
Liu Shangxi, a senior researcher with the finance ministry, said, "The taxes for luxury goods are imposed on the rich people, and should rather be raised than reduced. Besides, stronger reliance on imported goods may dampen competitiveness of domestic companies."
A survey conducted by the Ministry of Commerce showed that prices of foreign luxury goods sold on the Chinese mainland are, on average, 45 percent higher than in Hong Kong, 51 percent higher than in the United States, and 72 percent higher than in Europe.
According to the World Luxury Association, China is now the second-largest consumer of luxury goods and may eclipse Japan to become No. 1 next year, with forecast sales of US$14.6 billion. At the same time, more than 80 percent of the spending on luxury goods by Chinese consumers last year took place in foreign markets, it said. --(8/24)
Oil firms set to get tax rebates
China will grant tax rebates on natural gas imports in a bid to lighten the financial burden of the country's state-owned oil giants which have to sell the gas at a loss due to a gap between domestic and global prices.
The rebates will apply to imports of piped and liquefied natural gas during 2011 to 2020 as import costs are expected to be higher than domestic wholesale prices, according to a statement posted on the Ministry of Finance's website yesterday. But the ministry didn't give more details on the rebates.
Importers will receive the rebates quarterly, the ministry said.
The rebates will also be extended to imports of piped gas from central Asia in 2010, the ministry added.
The rebate move may help ease the financial costs of the state-owned oil giants, such as PetroChina, which are operating and building more LNG receiving terminals along the coast to meet rapidly growing demand for the cleaner-burning fuel.
China's LNG imports jumped 66 percent to 1.18 million tons in July from a year earlier, customs data showed yesterday. The LNG import costs averaged US$433 a ton last month, an annual rise of 47 percent. China also bought 907,545 tons of gas from Turkmenistan via the central Asia pipeline at US$423 a ton last month, according to the customs.
Energy prices are regulated in China by the government, which has to consider the affordability to the general public and inflationary concerns. Meanwhile, gas price reform has lagged changes in pricing of other fuel products, which generally follows global markets.
But rising imports of piped Turkmen gas and cargoes of LNG have reignited calls for a reform of gas pricing.
Zhou Mingchun, chief financial officer of PetroChina, said in March that the company lost 0.88 yuan (14 US cents) on the sale of every cubic meter of Turkmen gas in 2010, the first year of the cross-border pipeline's commercial operations. PetroChina received 4.3 billion cubic meters of Turkmen gas and sold 3.9 billion cubic meters last year, Zhou said. --(8/23
Museum damage admitted
The director of the Palace Museum in Beijing's Forbidden City has admitted human error led to the damage of at least three antiquities.
Zheng Xinmiao said carelessness by staff resulted in damage to three articles dating from the Qing Dynasty (1644-1911). Two "ritual implements" were damaged in May 2004, and a vase was damaged two years ago, he said.
Earlier this month, a whistle-blower, identified online as Longcan, made the accidents public through a blog, saying the museum had covered up serious damage to four exhibits.
The museum had previously announced that a researcher accidently damaged a thousand-year-old porcelain dish.
The Palace Museum has been under fire since May, when exhibits on loan from a Hong Kong museum were stolen from the palace complex.
Whistle-blowers also accuse the museum of running an exclusive club in one of its palaces and paying hush money to insiders who threaten to expose ticket scandals.
Zheng admitted there are "management loopholes" and blamed the museum's "lax supervision" of a commercial partner, Forbidden City Palace Cultural Development, for business activities in the palace.
He said the museum is offering rewards for information leading to the arrest of employees found cheating the museum out of ticket revenue.
Zheng promised greater transparency and engagement with the public. --(8/22)
Mainland executives travel most, survey says
Executives from the Chinese mainland were the most frequent travelers in the Asia-Pacific region in the first half of this year by making 8.7 overseas trips on average as they saw interpersonal relationships as a key element in business dealings, a survey showed yesterday.
About 51 percent of mainland respondents traveled abroad on business trips, followed by Singapore business travelers with less than 46 percent making such trips, hotel operator Accor said in its Asia-Pacific Business Traveler Research 2011.
"The sheer number of business trips made by Chinese mainland business travelers can be possibly attributed to the importance of positive interpersonal relationships as a crucial element for business dealings," said Evan Lewis, vice president of communications of Accor Asia-Pacific.
Hong Kong was the most popular destination for Chinese mainland business travelers, followed by Singapore and Thailand, the survey found.
Mainland business travelers are expected to remain at the top of the list by making 9.2 trips on average in the second half of this year, followed by Singapore and India, according to the survey.
The survey interviewed more than 10,000 respondents who made business trips in the first half of this year. Of these, close to 2,000 were executives on the mainland.
China Southern Airlines and Turkish Airlines have added new seats between economy and business classes on Chinese routes to combine convenience and lower ticket prices, targeting business travelers with tighter budgets. --(8/20)
SOEs' profits post 24% increase
Combined net profits of China's state-owned enterprises rose in the first seven months from a year ago. But they dropped in July from June.
The Ministry of Finance yesterday said profits for SOEs in the January-July period increased 24.4 percent from a year earlier to 1.34 trillion yuan (US$210 billion). But their profits in July fell 5 percent from June, the first monthly decline since April.
Profits for SOEs in construction material, chemicals and nonferrous metal sectors grew strongly in the first seven months, the ministry said.
However, those companies in real estate and light industries saw their earnings drop the most in July from a month earlier.
The five state-owned power generators continued to be profitable for the third consecutive month after China's top price regulator raised electricity prices in April.
"Profits of SOEs fell under inflationary pressure and a slowdown in industrial growth," TX Investment Consultant Co said. "But profits will grow in a stable manner in the second half."
br>China's industrial output rose 14 percent year on year in July, versus the 15.1 percent gain in June, the National Bureau of Statistics said. --(8/18)
China will sell yuan bonds in Hong Kong
China's Ministry of Finance is expected to sell 20 billion yuan (US$3.1 billion) in bonds today in Hong Kong, the third and so far largest issue of yuan-denominated bonds in the city.
Vice Premier Li Keqiang, who started a three-day visit to Hong Kong yesterday, will attend the sale ceremony as China promotes the internalization of its currency.
The sale includes 5 billion yuan in two-year bonds for individual investors. Institutional investors can choose to buy any of the 6 billion yuan three-year notes, 5 billion yuan five-year notes, 3 billion yuan seven-year notes and 1 billion yuan 10-year notes, according to the ministry.
The three-year bonds are expected to yield about 0.7 to 0.9 percent while the five-year debt may be offered in a range of 1.2 to 1.5 percent, Bloomberg News cited unnamed sources as saying yesterday.
The ministry had raised a combined 14 billion yuan from two previous sales of the so-called dim sum bonds in Hong Kong in 2009 and 2010.
Dim sum bonds refer to those that are yuan denominated and issued in Hong Kong. Dim sum bonds are attractive to foreign investors who desire exposure to yuan-denominated assets, but are restricted by China's capital controls from investing in domestic Chinese debt.
This year's institutional sale will be conducted via a Dutch auction starting at 9am today while the sale to individual investors will begin tomorrow via outlets of local participating banks and should be completed by the end of this month, according to Bloomberg News.
A Dutch auction is where the auctioneer begins with a high asking price which is lowered until a participant accepts the auctioneer's price, or a predetermined reserve price is reached. The winning participant pays the last announced price.
The Bank of Communications in Hong Kong will be responsible for the sale to institutional investors.
The Bank of China, HSBC Holdings Plc, Standard Chartered, the Agricultural Bank of China, Bank of Communications, the Industrial and Commercial Bank of China and China Construction Bank are running the sale to individual investors. --(8/17)
Most public buildings violating cool-air law
Some 63 percent of downtown buildings are being kept too cool in summer, violating an energy-saving law, a city government survey shows.
Government officials say the energy could otherwise be used to ease the power supply gap for households and other first-priority users such as hospitals and schools.
To ease the growing shortfall, which is most acute during the summer, the local government has ruled that commercial, office and other public buildings must keep their air temperature at or above 26 degrees Celsius. The estimated peak power load this summer has grown by 7 percent from a year earlier, continuing a growth trend.
The rule, enacted years ago, is now getting the attention of the city's energy-saving supervision center.
In a survey started on July 1 and completed yesterday, the monitoring watchdog paid undercover visits to 219 public buildings, such as hotels, office buildings and shopping malls, in nine downtown districts.
Officials discovered that 63 percent of the property managers were running their air conditioning lower than 26 degrees, with an average measurement of 25.5 degrees.
The watchdog said hotels performed the worst with less than 30 percent meeting the standard. Officials said some upscale hotels preferred to keep their lobbies and other public spaces cool enough to please the residents but said the practice is not worth it.
Watchdog officials said yesterday that they were now installing remote-control monitoring devices to catch future violators and would start handing out penalties. The amount of fines has not yet been specified.
Places such as hotels and high-end shopping malls will bear the focus of the upgraded monitoring attention, the watchdog said.
Not all agree with the rule.
Some property managers said that because of the structure of their buildings, they had to keep the air conditioning lower than 26 degrees to ensure all sections are cool enough. --(8/16)
High gains in prices and values
Shanghai ranks second among 10 global cities in the growth of residential property prices over the past five-and-a-half years while gains in capital values of luxury properties in the city are the sixth fastest in a group of key international cities over the past 12 months, according to two industry reports released over the weekend by major international real estate companies.
Prices of residential properties surged 143 percent in the city between December 2005 and June 2011, trailing only Mumbai where home price skyrocketed 154 percent during the same period, according to the latest Savills World Class Cities Index, which also tracks Tokyo, London, Paris, Sydney, New York, Singapore, Hong Kong and Moscow.
Meanwhile, the values of residential properties across the 10 cities jumped 77 percent on average over the same period, with New York recording the smallest increase of 7 percent, according to Savills research.
"Shanghai's property market has developed rapidly and matured notably over the last five to 10 years," said Albert Lau, managing director of Savills China.
"While the central government has imposed a series of stringent measures since earlier this year to cool the overheated market, the values of properties have not shown any signs of falling but continue to hold steady though price rises have moderated over the past months," he said.
The prices of luxury properties - the top 5 percent of the mainstream housing market - rose 7.7 percent in Shanghai in the year to June 2011, the sixth-fastest growth after Hong Kong, where they gained an annual 16.1 percent, St Petersburg, Paris, Beijing and London.
"While the annual price growth of prime properties in key cities has slowed rapidly, there seems to be a wide (price) divergence between properties in the mainstream and prime markets," said Liam Bailey, head of residential research at Knight Frank. "Prime residential markets have acted as 'safe-havens' for investors over the past two years." --(8/15)
Shanghai shares climb for third day
Shanghai shares yesterday rose for a third straight day with investors piling into consumer plays as defensive investments following a week of intensified volatility stemming from the debt crisis in Europe and the United States.
The Shanghai Composite Index added 0.5 percent to close at 2,593.17. It lost 1.3 percent this week, the fourth straight weekly decline.
Consumer-related shares, including clothing and liquor makers, were among the most sought after stocks yesterday.
Kweichow Moutai Co, a premium liquor maker and classified as a consumer staple by the Shanghai exchange, gained 1 percent to 216.77 yuan. Huafang Textile Co and Fujian Fynex Textile Science and Technology Co both jumped the daily limit of 10 percent.
China's insurance sector reportedly invested 10 billion yuan (US$1.57 billion) in Chinese mainland stock markets this week to boost sentiment, according to China Securities Journal.
In an earlier report, China's massive pension fund was also said to have moved up to 10 billion yuan to stabilize the market after the Shanghai benchmark index dropped nearly 100 points to a intraday low of 2,437 on Tuesday amid a global stock rout.
"The market will rebound from that 2,437, a level that would be the bottom if seen from a medium term," said Kang Hongtao, an analyst with Guoyuan Securities.
Analysts of Shenyin and Wanguo Securities agreed there would be a rebound due to low share valuations. --(8/13)
22 more Apple stores are fakes
Another 22 unauthorised Apple retailers have been discovered in China's southwestern city of Kunming, just weeks after a fake store in the city sparked an international storm.
Officials in the Yunnan provincial capital said the stores have been ordered to stop using Apple's logo after Apple China accused them of unfair competition and violating its registered trademark.
Kunming's Administration for Industry and Commerce said it would set up a complaints hotline and boost monitoring, Xinhua news agency reported yesterday.
In July, inspections of around 300 shops in Kunming were carried out after a blog post by an American living in the city exposed a near-flawless fake Apple Store where even the staff were convinced they were working for the maker of iPhones and iPads.
Five self-branded Apple Stores were found to be selling Apple products without authorization from the California-based company, but only two were told to shut because the outlets did not have an official business permit, officials said.
The order did not apply to the store mentioned by the American, which is applying to Apple for a reseller licence, a local government spokesman said after the inspections.
According to local officials, all five unauthorized Apple shops were selling genuine Apple products bought from authorized resellers in China.
Apple has just four genuine Apple Stores on China's mainland, in Beijing and Shanghai, and none in Kunming.
Chinese law protects trademarks and prohibits companies from copying the ¡°look and feel¡± of other companies'stores. --(8/12)
Yuan reaches new dollar high
China's currency hit a new record high of 6.4167 against the US dollar yesterday, with the yuan rising the most since November, according the People's Bank of China's official reference rate.
The appreciation follows China's record trade surplus in July and after a statement by the United States Federal Reserve that it would maintain low interest rates until 2013 at least.
The yuan is allowed to trade up to 0.5 percent on either side of the official rate released by China's central bank, and it touched 6.4120 yesterday during over-the-counter trading, the dollar's lowest level since China's revaluation in 1994.
Though the possibility of another round of quantitative easing, or printing money, was not mentioned in the Fed's statement, analysts believe the US will carry on with a relatively loose monetary policy to tackle its debt problems.
"China should definitely increase currency flexibility to ensure an independent monetary policy," said Li Miaoxian, an analyst with BOCOM International. "Serious inflation in China won't allow the government to adopt as easy a monetary stance as the US."
China's currency is around 5 percent stronger against the dollar than at the same time last year, but is weaker against other currencies such as the euro and the pound.
Li said the yuan had weakened by a weighted average of 1.5 percent against a basket of currencies since the beginning of 2011, and the depreciation had not affected China's exports significantly.
"A record surplus in trading allowed further appreciation of the yuan against the US dollar," a Beijing-based trader said. "But the jump in the exchange rate yesterday was larger than expected."
The DBS Bank said yesterday that the yuan would maintain stable appreciation and reach 6.30 against the US dollar by the end of 2011. --(8/11)
Inflation hits highest level in 37 months
China's inflation accelerated to a 37-month high in July on surging food costs, making it more difficult for policymakers to balance between price control and economic growth stabilization.
Some analysts said July's figure will be the peak for this cycle of inflation, and policies can't be tightened further amid worsening global liquidity.
The Consumer Price Index, the main gauge of inflation, soared 6.5 percent from a year earlier last month, the National Bureau of Statistics said yesterday. It compared with June's pace of 6.4 percent, and increased 0.5 percent on a month-on-month basis.
China's inflation rate has been breaching the government target of less than 4 percent in each of the first seven months. For 2011 so far, the CPI has gained 5.5 percent.
"July's rise was higher than our expectation," said Jing Ulrich, managing director at J.P.Morgan. "But we still think it will be a peak and prices will grow slower in the coming months with stabilizing pork supply and cooling commodity prices on a weak global market."
Food costs jumped 14.8 percent year on year in July, up from June's 14.4 percent. Pork costs continued to climb with an annualized growth of 56.7 percent. But it moderated very slightly from June thanks to abating pork costs in the last week of July.
Lian Ping, chief economist at the Bank of Communications, said there have been signs of easing inflationary pressure, and policymakers had better give up plans of more monetary tightening.
"Inflation rate may start to moderate in August and return to around 4 percent at the year end," Lian said. "China's tightening policies have yet to take full effect, so there is no need to make further moves such as another interest rate increase, especially under a market already short of liquidity."
Xinhua news agency said last Tuesday that China may raise interest rates again this week, and Lu Zhengwei, an analyst at the Industrial Bank, also predicted an interest rate increase in August.
Yao Wei with the Societe Generale said, "This is the kind of data that should trigger an interest rate rise, but the turmoil in global financial markets will probably delay the action."
To deal with the stubbornly high inflation, China has lifted interest rates three times this year, along with raising the reserve requirement ratio six times.
Such a tightening stance has made it difficult for companies to get loans, especially small and medium-sized firms of which credit is their lifeline.
Costs at the factory gate are also picking up. The Producer Price Index swelled 7.5 percent from a year earlier in July, up further from 7.1 percent a month earlier.
China's gross domestic product expanded 9.5 percent year on year in the second quarter, slightly slower than the first quarter's 9.7 percent and last year's 10.3 percent. Some analysts expect a big slowdown in the second half of this year. --(8/10)
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