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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by relevant provisions of WTO agreements."Other preferential policies on income tax pertinent to the disputes have been repealed or will be repealed along with the implementation of the new Enterprise Income Tax Law of China," the statement added.According to the Chinese mission, the MOUs will be notified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.

Authorities were unable to accurately predict the recent weather conditions due to lack of equipment and an adequate forecast model, the national meteorological agency has said."We underestimated the duration and severity of the weather and failed to pre-evaluate its impact on transport and the power sector," China Meteorological Administration (CMA) spokeswoman Jiao Meiyan said.The CMA had forecast all five rain and snowstorms between Jan 10 and Feb 5 two to five days in advance. But it failed to alert the public to the extreme danger of the storms."One reason why the weather department could not make precise forecasts is because many of the places most affected were located in mountainous areas where meteorological monitors are in short supply," Duan Yihong, deputy director of the National Meteorological Center, said."Another major problem is that China's numerical weather forecasts still fall far behind world standards."Numerical weather forecasts, based on calculations by high-performance computers, are a core part of modern weather bulletins. China began to develop its own numerical forecast model less than a decade ago.There is a 10-year gap between the Chinese model and advanced foreign models, Duan said.The extreme weather also made it a huge challenge for Chinese meteorologists."It was increasingly difficult to forecast as low-probability extreme weather is occurring more frequently," Qiao Lin, chief weather forecaster of the Central Meteorological Station, said.To enhance the country's defense against extreme weather, China will begin to establish a monitoring and warning system, Jiao said.

Chinese officials said water quality was improving in the country's third-largest lake, choked by a polluted slick of algae, but experts warned that tap water in the area was still not safe, state media reported on Saturday. Taihu Lake, in the southern province of Jiangsu, has been struck by a foul-smelling canopy of algae that left tap water undrinkable for more than 2.3 million residents of nearby Wuxi and prompted a run on bottled water at local supermarkets. Residents said the government was telling them it was safe to drink boiled water, but complained that it still had an unappealing green film on top. Environment experts said it was unlikely to be fit to drink. "Although quality of the water supply has improved significantly on Friday and now it is safe for washing hands or clothes, it still takes some time to become drinkable," the Zhang Xiaojian, an environment specialist at Tsinghua University in Beijing said. Algae blooms can develop in water that is rich in nutrients, often because of run-off from heavy fertiliser use, industrial waste and untreated sewage. Officials have invoked emergency measures, diverting the Yangtze river and seeding clouds to provoke rainfall, to try to flush out the algae. Heavy rainfall is also expected in the area in the next few days. Residents of Wuxi said the algae, which they said smelt like rotten meat, was driving a roaring trade at McDonald's and KFC fast-food outlets in the city. "Here they fry food," said a company manager named Zhao as he queued at KFC. "I can't eat dumplings or noodles because they would be cooked in water and it's too expensive to use bottled water."

Beijing and Seoul recently signed an agreement to launch a joint program to harness China's eighth-largest desert - the Ulan Buh in North China's Inner Mongolia Autonomous Region.About 15 million yuan (.99 million) will be spent growing trees and building greenhouses to prevent environmental deterioration in the Ulan Buh region, according to officials involved in the project.The Korea International Cooperation Agency (KOICA) has promised million for the project, while the local government will come up with the rest, according to Han Yongguang, deputy chief of Dengkou county, of which almost 80 percent is covered by desert."It is the first time that we have launched a joint program with a governmental institution from the Republic of Korea (ROK) on desert control," said Han, adding that the local government welcomes more international participation in the battle against desertification."We have made big progress in driving back the desert in this region since the 1980s; and international cooperation will help speed up the process of ecological balance." The local government has spent about 400 million yuan in recent years to contain the expansion of the desert, said Han."The cooperation also helps dispel any doubts over China's determination in environmental protection," Han added.Kim Kwang-young, chief of KOICA's China office, said: "I feel the Chinese government has fully recognized the importance of environmental protection."KOICA's collaborative programs in China are mainly focused on the environmental sector including afforestation, prevention of desertification, and joint monitoring of sandstorms, according to Kim.

The country's fast-developing tourism industry is expected to boost the hotel sector, a senior official has said.About 200,000 new hotels, resorts and guesthouses are likely to be built by 2015, head of China National Tourism Administration (CNTA) Shao Qiwei said on Thursday.Addressing a seminar on domestic and international hotels' groups, he said the new structures will include about 10,000 star-rated hotels. The number of five-star hotels in the country is expected to rise from 361 to 500."The World Tourism Organization has forecast that China will grow into a huge tourism market, and have 100 million each of inbound and outbound visitors and 2.8 billion domestic tourists by 2015," he said.The booming tourism market has created the need for new hotels and other infrastructure facilities, he said.The Shangri-La Hotels and Resorts plan to open five new facilities in the country this year, and at least 13 more in big cities such Beijing, Shanghai and Xi'an in the near future, the general manager of Traders Hotel at China World Trade Center in Beijing, Xin Tao, said.In fact, the group plans to open at least 40 new hotels in the country by 2011."The Olympic Games has brought us unlimited business opportunities and the increase of leisure, as well as business, travel in China will add to the appeal of hotel operators," she said.Investment from home and abroad into hotels will hit 340 billion yuan (.14 billion) between 2006 and 2010, the CNTA has forecast.The hotel sector was one of the first to be opened up in China, with Jianguo Hotel in Beijing being the first foreign-invested hotel to be approved by the State Council in 1979.Since then, 67 hotel brands of 41 international groups have entered the country and are managing 516 hotels at present, according to CNTA statistics.The hotel business has been expanding over the past three decades, and by the end of last year there were more than 14,000 star-rated hotels, 100 times more than in 1978.