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BEIJING, May 6 (Xinhua) -- China's central bank said Wednesday the economy is doing "better than expected" in the first quarter, and pledged to maintain "ample" liquidity in the financial system for economic recovery. China would stick to its moderately easy monetary policy and ensure "ample" liquidity at banks, the People's Bank of China (PBoC) said in its quarterly monetary policy report posted on its website. The country has pumped 4.58 trillion yuan (670 billion U.S. dollars) of new loans into the economy in the first quarter to stimulate growth. The figure is already nearing 5 trillion yuan of new loans targeted for the whole year. In March alone, new loans increased by a record 1.89 trillion yuan. The country's financial institutions and enterprises would digest the huge amount of new loans in the following months, the report said. Industry insiders have said credit extended by China's banks in April may have dropped to above 600 billion yuan after staying at above 1 trillion yuan for three straight months. The central bank said new lending from commercial banks focused on government-backed projects. It encourages more bank loans to be channeled to small and medium-sized enterprises as they play an important role in the national economy and in increasing employment. The central bank said in the first-quarter monetary policy report it would continue to instruct financial institutions to extend new loans, despite the earlier surge. The pick-up in bank lending is conducive to stabilize the financial market and boosting market confidence, PBoC said. Meanwhile, the bank urged lenders to improve credit quality to avoid a possible rebound in bad loans. There have been "positive changes" in the economy in the first quarter, the bank said, echoing remarks made by Premier Wen Jiabao last month. The quarter-on-quarter growth is improving, compared to the fourth quarter of last year, it said, without giving specific figures. China's economy expanded 6.1 percent in the first quarter, the lowest pace in 10 years and down from 9 percent in the fourth quarter last year. The central bank also said foundations for the recovery are not solid, as uncertainties in external economies still exist and private investment is yet to become active with new lending concentrated on government projects. In listing uncertainties ahead, the bank said the country still has to battle against the financial crisis that is unfolding and a collapse in external demand that is hurting exports. The country is also under great pressure to create enough jobs and from a slower growth in residents' income, which would suppress future consumption, it said. The bank also warned overcapacity and insufficient demand may drive prices lower in the country with the world economy in a downturn. But it also said continued falls in prices may become less likely along with the world recovery, a turnaround in the national economy and fast credit growth. "Prices of primary products and assets may rebound quickly once investor confidence is restored, as the global credit is relatively loose thanks to injection of liquidity and stimulus packages across the world," the bank said. The central bank also said it was concerned that the extraordinary monetary policy adopted by other major economies would result in inflation risks. It referred to the quantitative easing policy adopted by the U.S., Japan, Britain and Switzerland to pump cash into their economies. The quantitative easing policy meant increasing currency supply through purchasing mid- and long-term treasury bonds after central banks cut interests rates to near zero. The extraordinary monetary policy harbored huge risks for international financial markets and the global economy, said the central bank. It would increase the risk of global inflation, said the central bank, suggesting it would create new assets bubbles and inflation if central banks of major economies failed to mop up thehuge liquidity when the global economy recovered. "A policy mistake made by some major central banks would put the whole world in risk of inflation," it said. The quantitative easing policy would also make exchange rates of major currencies more volatile, according to the report. The central bank cited the U.S. move to purchase treasury bond in March as an example, saying although the dollar had appreciated against other major currencies, it fell after the purchase. PBoC said the policy would leave the bond markets subject to fluctuations. It said massive purchase of mid- and long-term treasury bonds may keep yield at a low level. But in the long run, as the financial markets returned to stability and the economy recovered, inflation expectations would grow, interest rates would rise, and bond prices would adjust sharply, according to the report.
BEIJING, May 18 (Xinhua) -- Chinese top leaders met Monday individual delegates from across the country who were awarded honors in Beijing for their dedication to public order. President Hu Jintao, Premier Wen Jiabao, Vice President Xi Jinping, and Zhou Yongkang, chief of the Central Political and Legislative Affairs Committee of the Communist Party of China (CPC), attended the meeting held at the Great Hall of the People. The leaders are all members of the Standing Committee of the Political Bureau of the CPC Central Committee. Zhou said at an awarding ceremony after the meeting that local governments had put great endeavor to maintaining stable social order and public security. He urged Party organs at all levels to take the initiative of blending comprehensive control of social public security with overall economic and social development. The senior official asked local governments to improve their capability of handling public security emergencies and actively prevent potential social conflicts. The Chinese government has carried out a strategy to maintain social order and public security by involving volunteers and Party members in enterprises, offices, universities and even the retirees to help the police authorities with information and supervision on minor conflicts and suspected crimes. At the awarding ceremony which was also viewed nationally by a tele-conference system, outstanding individuals and organizations were given honors for their endeavor and dedication to the country's smooth social order. Zhou encouraged the honored individuals and institutions to have more innovative ideas and methods to promote the overall control of social order. Chinese President Hu Jintao (R, front) meets Monday individual delegates from across the country who were awarded honors in Beijing for their dedication to public order. He stressed that local governments should enhance and expand the grassroots network of the social order's maintaining units and take the advantage of the public's power and wisdom. The local authorities should also pay more attention to educational work and prevention measures in addition to fighting and punishing criminals. By continuing preventative efforts to maintain public security, the governments should improve their abilities of social management and public service, Zhou added.
ROME, July 10 (Xinhua) -- China is set to become a global leader in the implementation of environmental-friendly policies and green technologies to tackle climate change, an Italian expert told Xinhua in a recent interview. For Stefano Pogutz, an environmental management professor at Bocconi University in Milan, China's green-policies investment plans are greater than those carried-out in the United States and in many other industrialized countries. "What China is doing to tackle global warming is impressive considering the density of Chinese population and the rapid economic growth model China is following," Pogutz said. Climate change is at the core of the G8 summit held in L'Aquila from Wednesday to Friday. Talks had focused on the need to forge anew post-Kyoto agreement and to increase research and investments in the green economy. The results of the G8 summit on climate change should pave the way to the United Nations meeting in Copenhagen in December, which aims at sealing a global deal to limit greenhouse gas emissions. According to the UN climate change framework agreement and the Kyoto protocol, China is not subject to mandatory emission cuts ofCO2. However, on its own China is already contributing to the fight against climate change through a series of initiatives aimed at curbing carbon emissions, such as lowering internal energy consumption levels and launching traffic and transportation monitoring schemes. "I don't agree with those who believe that China is responsible for global pollution," Pogutz said. "China is doing a lot, there's a direct public intervention on measures aimed at fighting climate change. The Chinese government has increased investments in technologies and infrastructures to boost energetic efficiency and cut CO2 emissions." Luca Labella, a China analyst with Rome's International Studies Center (Cesi), remembered the numerous local green projects implemented in China such as Shanghai's LPG buses and the rural towns' biomass-fueled. "China is open to climate change issues and solutions. However, in China climate change is not considered under a political perspective but a scientific one, focused on progress and research," he added. According to Pogutz, China is set to have a role of leadership in the use of renewable energies and other green technologies. "Today China is one of the greatest producer of solar panels and in the near future it could lead in the export of alternative energy technologies." But it's not only a matter of strategic investments in green technologies. China's contribution to the global fight against climate change largely depends as well on its human resources. "Almost all PhD students in the U.S. come from China," he added.
BEIJING, April 30 -- The nation's stimulus package has benefited energy conservation and emission controls with energy used to generate growth dropping further in the first quarter, the National Bureau of Statistics (NBS) has said. Energy intensity, or the amount of energy needed to generate per unit of GDP, dropped 2.89 percent year on year from January to March. That compares with a drop of 2.62 percent in the first quarter of 2008. Overall energy consumption grew only 3.04 percent in the first quarter from a year earlier while the economy expanded 6.1 percent, the bureau said in a statement. The NBS said the ratio of the services sector in the overall economy rose 1.6 percentage points, while the industrial sector dropped 1.9 percentage points. Also, the output of six energy-intensive industries fell 12.5 percent from the previous year. The figures show the stimulus measures have aided efforts to increase energy efficiency, cut emissions and promote economic restructuring, it said. The government announced a 586 billion U.S. dollars stimulus package last November to prop up domestic demand and maintain growth. But the huge spending plan sparked concerns that officials might compromise on environmental protection and energy saving targets, given the emphasis on growth. Yet, analysts said little of the government's spending has been allocated to high energy-consuming or highly-polluting projects, while spending on environmental issues has been increased. Capital requirements for projects such as railways, airports and housing will be lowered to raise investment, said a State Council meeting presided by Premier Wen Jiabao Wednesday. However, capital requirement for investments in high energy-consuming or heavily-polluting sectors, such as aluminum smelting, will be raised to prevent a rebound of production capacity in such industries. Of the 230 billion yuan the central government has approved on stimulus spending over the past two quarters, 10 percent went toward energy conservation, emission control and environmental protection projects, the National Development and Reform Commission said in a statement Wednesday. The figures show the central government wants to strike a balance between growth and economic restructuring, said Chi Fuling, president of the China (Hainan) Reform and Development Research Institute. The government may even increase spending on energy saving and environment protection as it tries to facilitate industrial transformation, Chi said. According to the NDRC, the government has earmarked 13 billion yuan in the next three years to expand sewage and garbage disposal facilities to most townships. It has also allocated 4 billion yuan for tackling water pollution in major rivers such as the Huaihe and the Songhuajiang. Forest conservation and energy saving projects get a combined 6 billion yuan. The government has pledged to reduce energy intensity by 20 percent by 2020 from 2005 levels; and chemical oxygen demand (COD), a key index of water pollution, and emissions of sulfur dioxide (SO2), a main air pollutant, by 10 percent between 2006 to 2010.
CHENGDU, June 3 (Xinhua) -- Sichuan Tengzhong Heavy Industrial Machinery Co., Ltd. (Tengzhong), a private Chinese firm who has struck a preliminary deal with General Motors Corp. (GM) for the premium SUV brand Hummer, said Wednesday it has no plan to manufacture Hummer in a Chinese plant. "Rather than setting up a plant in China, Tengzhong will use the current facilities including their employees in the United States," said Zhao Xiaolu, spokesman for the ongoing transaction for Tengzhong, a leading manufacturer of road, construction and energy industry equipment based in southwest China's Sichuan Province, Zhao works for the Brunswick Group, which is handling the public relations matters for the Tengzhong deal. Tengzhong's managers were not available for comment on the transaction, which was disclosed Tuesday, a day after GM filed Chapter 11 bankruptcy. File photo taken on March 11, 2009 shows Hummer CEO James Taylor (R) presenting a Hummer model to a local official in Deyang, southwest China's Sichuan Province. U.S. automaker General Motors Corp., a day after filing Chapter 11 bankruptcy, has a tentative deal to sell its Hummer brand to Chinese-based Sichuan Tengzhong Heavy Industrial Machinery Co., Ltd., the automaker said on June 2. According to an overall restructuring plan, the U.S. based automaker GM will shed off its none-core assets including Hummer, Saturn, Saab and Pontiac. The preliminary deal allows Tengzhong to keep the management and operational team along with the Hummer brand, and secure more than 3,000 jobs in the United States. The Chinese buyer will also assume existing dealer agreements relating to Hummer's dealership network. Tengzhong CEO Yang Yi said in a statement Tuesday that the company will "allow Hummer to innovate under the leadership and continuity of its current management team". James Taylor, Hummer chief executive officer, went to Chengdu City and Deyang City, Tengzhong's current base and new base under construction, to discuss project cooperation with local officials in March. "This transaction, if successful," said Taylor in a statement Tuesday," will allow us to embark on a more aggressive global expansion, ensuring a successful future with our new partners." According to Zhao, Tengzhong will use internal fund and bank loan to make the transaction, which will be a "strategic move for the company to expand into the premium off-road vehicle segment". Formed in 2005 through a series of mergers, Tengzhong currently has more than 4,800 employees. "It is probably more attractive for Chinese enterprise like Tengzhong to learn from the foreign brand's past successful experience in research, design, marketing and service," said Guo Guoqing, a professor with the School of Business, Renmin University of China. Xu Zhaohui, head of the Sichuan Provincial Department of Commerce, said the officials will "strive to serve the transaction", which is expected to close in the third quarter of this year and is subjected to customary closing conditions and regulatory approvals. In recent years, there have been several headline purchases of foreign auto brands by Chinese enterprises. A Hummer is on sale at a dealer in Flint, Michigan, the United States, May 30, 2009. General Motors Corp (GM) announced on June 2 that it has entered into a memorandum of understanding (MoU) with a buyer for HUMMER, its premium off-road brand, a day after it filed for bankruptcy protectionIn 2004, Shanghai Automotive Industry Corporation Group (SAIC)purchased 48.9 percent equity of Ssangyong Motor, the fourth largest automaker in the Republic of Korea (ROK). In 2005, Nanjing Automotive bought collapsed British brand MG. And this March, China's largest independent carmaker Geely Automobile acquired Drivetrain Systems International, the world's second largest auto transmission supplier. "Acquisition of overseas brands by Chinese enterprises could help these brands go over operational dead end, and expand in the vast Chinese market," said Guo. All the world's main auto markets are in decline except form China. In the first quarter, almost 2.68 million vehicles were sold in China, which marked a 3.88 percent increase year on year. However, not all foreign auto brands revived under Chinese management. In February, a Seoul court granted Ssangyong Motor bankruptcy protection. SAIC was deprived of management control despite its 51 percent ownership. "Declining asset prices amid the financial crisis do not always mean a good bargain for the buyer," said Zhang Zhiyong, the chief adviser on auto market with Mingyuan Consultancy in Beijing, "a Chinese automaker should choose a foreign brand with conforming strategy and similar culture for possible acquisition." The fuel-hungry brawny Hummer also pose new challenges for Tengzhong to control cost and boost competitiveness after takeover. Statistics from local vehicle management section showed that Hummer vehicles are only owned by about 10 people in Sichuan's capital Chengdu currently. "We will be investing in the Hummer brand and its research and development capabilities," said Yang Yi in a Tuesday statement, " which will allow Hummer to better meet demand for new products such as more fuel-efficient vehicles." (Xinhua reporters Yan Sanjun, Guo Xin, Cheng Xie and Chen Kai also contributed to this story)