China records huge Feb trade deficit
Customs data shows China recorded a huge trade deficit in February of US$ 31.48 billion. The figures follow a surge in oil imports. China is normally a net exporter of goods - it recorded a surplus of $ 27.28 billion in January - but total monthly imports rose 39.6 percent year-on-year to $ 145.96 billion, with exports only going up 18.4 percent to $ 114.47 billion. The deficit was far in excess of the median forecast of $ 8.5 billion in a Dow Jones Newswires survey of 15 economists. They had expected a larger rise in exports and a smaller increase in imports. But the customs data showed that the country's crude oil imports reached a record monthly high of 23.64 million tonnes, equivalent to 5.98 million barrels a day. China's trade figures are politically sensitive, with Beijing and Washington embroiled in a long-running dispute over the value of the yuan, which the US says is kept artificially low to unfairly help Chinese exporters.
HK shares slump after China growth cut
Hong Kong shares have tumbled 2.1 percent after China set a lower target for growth this year, raising fears of a slowdown in the mainland economy. The Hang Seng Index lost 459 points to close at 20,806, its lowest level since February 10. Turnover was HK$ 127.10 billion as American International Group, AIG, sold off about half its stake in the AIA Group. Investors were downbeat after Premier Wen Jiabao yesterday cut the China's growth target for 2012 to 7.5 percent. "The impact is likely to linger for a while, as the market has yet to digest the negative effects that slower economic growth might have on companies," said Shen Jun, an analyst at BOC International. Attention will now turn to Friday, when China is scheduled to release key economic data for February, including inflation.
China seeks stake in Aussie gas project
The biggest mainland energy producer, China National Petroleum Corporation, is said to have offered to buy a minority stake in a liquefied natural gas project in Australia. The state-controlled company will face competition from rivals from Japan, Taiwan and South Korea. China is buying energy assets abroad to acquire technology needed to explore resources at home.
China to lower bank reserve ratio again
China's central bank plans to lower the ratio of funds that banks must hold as reserves to spur slowing economic growth. The People's Bank of China said the reserve requirement ratio will be decreased on Friday to 20.5 percent from 21 percent. The cut will free up tens of billions of dollars for lending at a time when the growth rate is expected to drop from last quarter's 8.9 percent to closer to 8 percent. The cut is the second in two months. The bank had pushed the rate to a record 21.5 percent in June after consumer prices rose by a three-year high of 5.5 percent the previous month. Inflation rose by a strong 4.5 percent over a year earlier in January.
US clinches China film market deal
U.S. Vice President Joe Biden has said China has agreed to significantly improve market access for American films. The agreement allows more American exports to China of 3D, IMAX, and similar enhanced-format movies on favourable commercial terms. The deal was announced after Vice President Xi Jinping's whirlwind tour to the United States. "This agreement with China will make it easier than ever before for U.S. studios and independent filmmakers to reach the fast-growing Chinese audience, supporting thousands of American jobs in and around the film industry," Mr Biden said in a statement. The U.S. film industry has long complained about China's tight restrictions on the number of foreign films allowed into the country each year, a limit that they say helps fuel demand for pirated DVDs that are widely available in China. While the quota of 20 foreign films per year remains in place, Beijing granted other concessions that pleased Hollywood. The Office of the United States Trade Representative said the deal strengthens the opportunities to distribute films through private enterprises rather than the state film monopoly, and ensures fairer compensation levels for U.S. blockbuster films distributed by Chinese state-owned enterprises.
New Zealand halts China farm sale
New Zealand's High Court on Wednesday overturned a decision to allow a Chinese company to buy a bankrupt dairy farm group, in a case which has sparked heated debate about foreign land ownership. The court ordered the government to reconsider its approval for China's Shanghai Pengxin Group to purchase the 16-property Crafar Farms group, saying it had overstated the deal's economic benefits to New Zealand. The proposal has met with fierce opposition in the farm-reliant country, with critics fearing an influx of foreign investors will snap up New Zealand's prime agricultural land.
China may ‘move soon’ to help Europe
An economist with the Chinese Academy of Social Sciences, Yuan Gangming, says China may "move shortly" to help Europe solve its debt crisis. He told Bloomberg that Beijing might invest as much as 100 billion euros in the euro zone bailout fund and a facility set up by the International Monetary Fund. He said China's contribution would be "meaningful" to stabilise conditions, while allowing Beijing to reap investment returns, improve its image and have a greater say in European and global financial talks. Mr Yuan said his estimates didn't necessarily represent what the government is planning to do.
Wen: China has stake in helping Europe
China has a stake in helping the eurozone countries get through their debt crisis, Premier Wen Jiabao said in comments published on Sunday, pointing to Europe's importance as an export market and as a source of technology. "Now Europe is facing a debt crisis and we must consider relations with Europe strategically to protect our national interests," Mr Wen said while visiting Guangdong province, Xinhua news agency reported. "On the one hand, our biggest export market is Europe," said Mr Wen. "On the other hand, Europe is our biggest source for importing technology. From this perspective, helping to stabilise European markets in fact amounts to helping ourselves. We must make all quarters of society understand this point." During German Chancellor Angela Merkel's recent visit to China, Mr Wen said Beijing was considering increasing its participation in rescue funds to address the European debt crisis.
China retail sales get holiday boost
Retail sales in China surged 16.2 percent year-on-year to 470 billion yuan during the week-long Lunar New Year holiday, as consumers splashed out on food, wine and clothes. Hundreds of millions of people journey across the country during the holiday to celebrate with their families and consumer spending typically soars during the period. The commerce ministry said sales of clothes, jewellery and food rose 18.7 percent, 16.4 percent and 16.2 percent respectively.
NZ approves dairy farms deal with China
The New Zealand government has approved the sale of 16 dairy farms to a company controlled by a wealthy Chinese businessman, Jiang Zhaobai. The company didn't reveal how much it is paying, but said it would invest more than US$ 164 million in the first two years. It said the deal would supply high quality diary products to China. But the deal has sparked local objections to the increasing foreign ownership of the country's key industries.