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GENEVA -- China has reached understanding with the United States and Mexico on their alleged trade subsidy measures, sparing a WTO panel ruling on the case, the Chinese WTO mission said here on Thursday.Chinese Ambassador Sun Zhenyu signed respective memorandums of understanding with his US and Mexican counterparts "regarding certain measures granting refunds, reductions or exemptions from taxes or other payments" at the WTO headquarters on Thursday, the mission said in a statement.In the MOUs, China made it clear to the United States and Mexico that "the policy of exemption for certain foreign-invested enterprises from payments to the State for worker allowances is no longer operative."Besides, the policy of value-added tax (VAT) refund to enterprises for the purchase of domestically produced equipment does not constitute prohibited subsidies as provided by relevant provisions of WTO agreements."Other preferential policies on income tax pertinent to the disputes have been repealed or will be repealed along with the implementation of the new Enterprise Income Tax Law of China," the statement added.According to the Chinese mission, the MOUs will be notified to the WTO as mutually acceptable solutions to the above-mentioned dispute in accordance with the Dispute Settlement Understanding of the world trade body.The United States filed the case to the WTO in February and later was joined by Mexico. The two countries alleged that China was using tax breaks and other incentives to "subsidize" its exports, which might violate WTO regulations.A WTO panel was established in August to investigate the case, following failed consultations between the three sides.But the three sides finally reached understanding on the dispute through continued discussions.

Aerospace experts saved the country's first ever manned space mission as the spaceship faced a potentially lethal impact while flying through the communications blackout area before landing, the country's space authorities revealed yesterday.China became only the third country to put a man in space, after the former Soviet Union and the United States, when Yang Liwei orbited the Earth in 2003 in what was a resounding success for its space program.But Xinhua News Agency reported that this was almost not so, quoting the Xi'an Satellite Monitor and Control Center's report on the dangers the Shenzhou V rocket faced."Yang lost every means to communicate with the ground command and control headquarters as he entered the ( Earth atmosphere), which fell in the worst-case scenario prepared by the space mission team," Xinhua quoted Dong Deyi, head of the center, as saying.Communications go down when any spacecraft re-enters the Earth's atmosphere, but in Yang's case, "even radar could not capture any signal from the returning module", Dong was quoted as saying. "After the Shenzhou V came out of the blackout area, the echo signals from the spaceship were still volatile, which sufficiently threatened the safe landing of astronaut Yang."Mission control promptly ordered optical guiding and tracking instead of a communication-guided landing, Dong was quoted as saying."Aerospace technologists used cinetheodolites (optical trackers) on the ground to measure the spacecraft's position and record movements. Precise positioning of the spacecraft enabled officers to properly control the slow-down parachute, which was vital to a soft landing."But the landing was 9 km east of the planned site, Dong said.China began its clandestine manned space program in 1992. The country has since spent at least 20 billion yuan (.64 billion) on the project and sent three astronauts into orbit.Dong also revealed that at least three orbiting satellites were malfunctioning during certain periods, but all had been salvaged by experts since October 2006.The Xi'an center, established on June 23, 1967, in the mountains of Northwest China, has monitored and controlled more than 100 satellites and the six Shenzhou spaceships. According to official records, China now has at least 19 satellites orbiting the earth.China plans to chart every inch of the moon's surface as part of its ambitious space program.China, which plans to launch a lunar orbiter called "Chang'e I" in the second half of this year to take 3D images, would aim to land an unmanned vehicle on its surface by 2010, Zhang Yunchuan, minister of the commission of science, technology and industry for national defense, said on Friday.Xinhua-Agencies

BEIJING, March 27 (Xinhua) -- China's economy would moderate but remain robust in 2008 with a growth rate of 10.7 percent, providing a cushion against the expected international downturn, according to a forecast issued by the United Nations commission here on Thursday.     "Investment continues to be the main driver of growth, remaining resilient despite government cooling measures and with support from low real interest rates," said a report released by the UN Economic and Social Commission for Asia and the Pacific (UNESCAP).     "A slowdown in exports and the country's efforts to cool the economy are the main reasons for the moderation," it said.     Other factors expected to underpin China's growth include domestic demand, increasing spending power of rural consumers and rising consumption through higher government spending on social welfare.     Official statistics show China's gross domestic product growth accelerated to 11.4 percent in 2007, the fastest for 13 years.     The report said the U.S. sub-prime mortgage crisis is not expected to have a strong impact on growth in China.     "In a worst case scenario where the U.S. economy goes into recession, the impact on China will not be as great as on other Asia-Pacific countries. Due to its blistering pace, China's growth will remain resilient, but will slow," said Shuvojit Banerjee, a senior expert with the UNESCAP.     According to the report, China's increasing exports to the European Union are expected to compensate for a steady fall in exports to the United States, China's second largest export market. China has also witnessed a boom in trade with Africa.     It said Chinese and other Asia-Pacific investors are playing a key role in supporting developed countries through the turmoil. Sovereign wealth funds and state investment institutions from the region have bolstered weakened banking sectors in the United States and the Europe.     The report said China is facing an increasing challenge from inflation. The chief inflationary concerns lie in higher international oil and food prices. "Rising food prices are a bigger inflationary concern than oil prices because food accounts for a far higher proportion of consumer spending. Food price inflation particularly hits low income households."     The report also warned that the fast growth is coming at an increasing cost to the environment. It said the destabilizing effect of growth on the environment is becoming more apparent. Air pollution, especially in large cities, is increasing the incidence of lung disease.

The second batch of quotas for qualified foreign institutional investors (QFII), a scheme for foreign players to invest in the A-share market, is likely to be about billion, an industry insider, who declined to be named, told China Daily on Friday. The source said that the second batch of QFII quotas was being discussed, and pending approval by the Chinese government, was likely to be about billion, not exceeding that of the last batch, which was billion. Hu Xiaolian, Deputy Governor of the central bank and Administrator of the State Administration of Foreign Exchange (SAFE), said earlier that related rules on the QFII scheme were being amended and the total QFII quota would certainly see an increase in 2007. However, she declined to give a specific sum. China has so far approved 52 overseas institutions as QFIIs to invest in the A-share market, of which 49 have got a combined investment quota of .995 billion from SAFE, near the upper limit of billion as stipulated previously. Industry insiders said the demand for QFII quotas was strong at present and more should be granted. "Despite the excessive liquidity in the A share market, the Chinese government should grant more quotas to QFIIs. Otherwise, they will find other ways, making it more difficult to supervise," She Minhua, an analyst with CITIC China Securities said. Meanwhile, the booming Chinese stock market is attracting more foreign financial firms to set up joint ventures in the investment sector. The Financial Times on Thursday reported that Nikko Asset Management, a QFII approved in 2003, has become the first Japanese fund firm to acquire a 20 per cent stake in a local firm, the Shenzhen-based Rongtong Fund Management Company. Nikko AM bought the stake from Shaanxi International Trust & Investment (SITI), for 3.8 yuan per share, valued at 475 million yuan, according to a statement by the Shenzhen-listed SITI.

FUZHOU - Seven people are missing after a fishing vessel collided with a cargo ship in the sea near Keelung Islet, Taiwan, in the early hours of Saturday, said an official with the Taiwan Affairs Office of East China's Fujian Province.A cargo ship, registered in Singapore, collided with a fishing boat, which was carrying 71 people - two from Taiwan and 69 from the mainland, said the official.All the fishermen plunged into the sea but 64 people were later rescued. The seven missing people were confirmed to be residents on the mainland.The rescue operation is ongoing.