SWISS INNOVATION WEEK in Beijing and Shanghai
In a new approach to establish and extend bilateral cooperation between Switzerland and China, a combined Swiss Delegation composed of more than 80 officials, business people and scientists visited Beijing and Shanghai. The Swiss Delegation was led by David Syz, Head of the State Secretariat for Economic Affairs together with Charles Kleiber, Head of the Swiss Science Agency and Eric Fumeaux, Head of the Federal Office for Professional Education and Technology. Members of the Delegation met with high-level representatives from the Chinese government and academic institutions, participated in workshops, seminars and field trips and held one-to-one meetings between business people and academics. (Embassy of Switzerland, 14 June)

China exports first shipment of compact cars to US
A shipment of 252 Xiali economy cars manufactured in north China's port city of Tianjin is on its way to the United States market. A spokesperson for the American sales agent said the stability, reliability and fuel efficiency of the Xiali compact car, which will sell for USD 10'000, will make it competitive on the American new car market. (People's Daily, 11 June) Are we talking about THE Xiali?

China's private companies add 2.5 million new jobs
China's private companies added 2.5 million new jobs in 2001, while struggling state-owned enterprises continued to shed workers. The new figures are likely to reinforce the government's recent and belated embrace of private companies as a source for new jobs for its growing ranks of unemployed. However, the overall growth in urban employment wasn't able to keep pace with the increase in the labor force, causing the unemployment rate to rise to 3.6% at the end of 2001. (Dow Jones Newswires, 11 June)

China January to May exports up 13.2%
In the first five months of the year, exports rose 13.2% to USD 116 billion. Imports rose 10.9% on year to USD 105.6 billion, yielding a trade surplus of USD 10.43 billion. The processing trade accounted for 41.7% of all imports in the January-May period, rising 21.5% to USD 44.0 billion. Machinery and electronics were the main drivers of export growth, with exports of those products up 22.9% in the first five months of the year to USD 55.5 billion. (Dow Jones Newswires, 11 June)

Tight grip loosens on SOEs
China has worked out an aggressive plan that will allow foreign multinationals to acquire State-owned enterprises. According to the regulation, several of China's top 500 SOEs - which long have been pillars of the country's economy, but now are holding up the country's economic restructure with their mounting bad loans - will co-operate with foreign rivals in the near future. The money from the stake sales will be used to fund the country's social security system, which is expected to support millions of retired SOE employees. (Business Weekly, 11 June) Foreigners are welcome to have their check-books ready.

Many companies in China's Jiangsu paid bribes to get IPO OK
About half of the listed companies in Jiangsu, one of China's wealthiest and most successful provinces, paid bribes to local officials to secure permission for their share offerings. A number of top provincial officials have been jailed by courts in Nanjing for up to 11 years over the incidents. (FT, 11 June)

Bentley sold for USD 1 million in Beijing
A Bentley on display at the ongoing 7th Beijing International Auto Industry Exhibition has been sold for RMB 8.88 million. "The price is nothing for" the six Chinese business magnates who wanted to buy the car, said a Bentley executive. It is predicted that more than 30 Bentley and Rolls Royce cars will be sold in China this year, with 16 to be sold in the Beijing area. (ChinaOnline, 11 June)

Fresh China rate cut sought
The debate over interest rates has been renewed with China facing slowing retail growth and growing unemployment. The State Information Centre's economic forecast department, a mainland think-tank, has called for another interest rate cut to ease growing deflationary pressure. A rate cut together with the extension of more low-interest loans to small and medium-sized enterprises and increased efforts made to raise farmers' incomes would alleviate deflationary pressure. (SCMP, 11 June)

China draft plans for foreign entry to stock market
China has drafted detailed plans to attract qualified foreign institutional investors (QFII) in one of a series of bold new steps to open up its stock market. The QFII scheme is expected to allow qualified foreign institutions to set up special accounts at designated banks in China, through which they can receive foreign currencies and convert them to renminbi to invest in the local stock market. They would be able to invest in the A-share market, which is now open only to Chinese investors. (People's Daily, 12 June)

No 1 stock scandal case heard
The largest price manipulation case in China, involving more than RMB 5.4 billion of funds gathered from more than 100 companies and individuals was heard by Beijing's No 2 Intermediate People's Court. The Shenzhen China Venture Capital Co case marks the country's first manipulation case involving the price of stocks. (China Daily, 12 June)

China to adjust immigration policy to attract overseas skills
The Chinese government will draft new immigration rules in an effort to create more favorable conditions for skilled foreigners to live and work in China. The new laws will allow long-term and permanent residence for overseas professionals working in China's industries involved with new and much-needed technology, such as information technology, bio-technology, new materials and manufacturing technology, as well as aviation and space technology. Such sectors as finance, law, international trade, science and technology management are also on the list. The government will provide the professionals with high pay, key laboratories and research facilities. (People's Daily, 12 June)

Pudong attracts USD 39.2 billion in overseas invstment
The Pudong District of Shanghai has attracted USD 39.2 billion in overseas investment over the past 12 years, about one third of Shanghai's total overseas investments. Overseas-funded enterprises have been the driving force behind the rapid economic development of Pudong. They account for 30% of the district's GDP, half of its fiscal revenue and export, and nearly 80% of the output of high-tech products. (People's Daily, 12 June)

Industrial-sector output records three-year high
Lifted by revived exports and government spending on infrastructure, China's industrial production last month climbed 12.9% year on year to RMB 261.7 billion, the biggest gain since December 1998. In the five months to May, industrial value-added output grew by 11.6% year on year to RMB 1.17 trillion. (SCMP, 12 June)

Oracle to set up new R&D centre in Beijing
Oracle Corporation, the second biggest software vendor in the world, will set up its second research and development centre in China and aims to strengthen co-operation with local partners. (China Daily, 12 June)

China reports soaring overseas investment
China used overseas funds of USD 16.92 billion in the first five months of this year, up 12.4% on a year-on-year basis. During the period, the government approved 11'612 foreign-funded companies, up 23.26%. The contractual foreign investment totaled USD 27.86, up 7.3%. China now has 401'637 foreign-funded companies, backed up by contractual foreign investment of USD 773 billion, of which USD 412 billion U.S. dollars has already been put to use. (People's Daily, 13 June) See for another way to look at the figures below.

FDI growth moderates
Foreign investment in China is starting to slow after the mainland attracted a record amount of capital last year. Although China's latest actual FDI data continued to show healthy double-digit growth, the figures fell sharply compared with those for the first four months of the year. Economists attributed the relatively sharp drop in the actual FDI growth rate to the passing of an initial wave of foreign investment flowing into post-WTO China. (SCMP, 13 June)

Legend to move headquarters to Shanghai
Legend Group Corp., China's top computer manufacturer, intends to move its headquarters from Beijing to Shanghai. The strong capital base and export conveniences of Shanghai attracted the computer-science group, which hopes to earn about one third of its total profits from the international market within ten years. (People's Daily, 13 June)

China's consumer prices fall, but deflation is seen easing
China's consumer prices continued to fall in May, but economists expect deflation to ease in the second half due to looser monetary policy and an expected upturn in the global economy. The falling prices threaten to recreate the three years of deflation China experienced from 1998-2000, as the country still hasn't solved the problem of excess industrial capacity. (Dow Jones Newswires, 13 June)

CPI falls for the 7th month
China's consumer price index declined 1.1% in May compared with the same month last year. The consumer price index in the first five months of the year was down 0.8%compared with the same period a year ago. Prices for consumer goods in May dropped 1.9% from a year earlier, while prices for services rose 1.6%. Prices for non-food goods dropped 0.9%, and food prices were down 1.5%. More than 80% of the China-made products are oversupplied. (China Daily, 14 June)

China sees retail consumption boom in May
Retail consumption hit a record RMB 320.2 billion in May, an increase of 9.3% over the same time last year. Labor Day holiday boosted public consumption, with tourist and tourism revenue rising by 18.1% and 14.9% respectively while the sales volumes of 128 shopping centers in 31 tourist cities rose by 15.2%. The high temperatures in northern areas gave rise to sales of air conditioners and electric fans. The World Cup and the International Children's Day also boosted sales of televisions, souvenirs and toys. (People's Daily, 14 June)

Car-maker to slash jobs as merger sealed
Tianjin Automotive Industry will slash 75% of its 40'000-strong workforce within two years as it sells most of its operations to rival First Automotive Works. The deal is in line with a state agenda to create two to three strong and internationally competitive domestic car giants and is expected to spark a wave of mergers in the industry. China's car industry is crowded with about 100 manufacturers, mostly small operations scattered around the country and supported by regional government budgets. The mainland's car industry has two million workers and annual output of 2.3 million units. Japanese car-maker Honda reportedly achieves annual output of 5 million units with a workforce of 60'000. (SCMP, 15 June)

Incentives aim to boost foreign forays
The Shenzhen municipal government has announced a range of measures to support the city's enterprises in their foreign development, following Beijing's lead in encouraging state enterprises to "go overseas". (SCMP, 15 June)

Tianjing reports 20% growth in FDI
Tianjin used USD 1.455 billion worth of foreign direct investment during the first five months of this year, up 20.2% on the same period of last year. Tianjin approved a total of 282 overseas investment projects during the period. Contracted overseas investment in the tertiary sector, particularly international trade and services, has grown by 130% during the five month period to USD 557 million. (China Daily, 15 June)